Sonae, SGPS, S.A.

Hello, and welcome to the SENAI 2025 full year and Q4 results. My name is George. I'll be the coordinator for today's event. Please note, this conference is being recorded, and for the duration of the call, your lines will be in the listen-only mode. However, you have the opportunity to ask questions during today's presentation, and this can be done by pressing star 1 on your telephone keypad to answer your question. If you require assistance at any point, please press star zero and you'll be connected to an operator. And I'll hand the call over to your host, Sunai's CFO, Juan Dolores, to begin today's conference. Please go ahead, sir.

Thank you. Hello, everyone. Thank you for joining us for Sunai's results presentation for 2025. Besides myself and the investor relations team, I have with us, we have with us Christina Neuweiss from BrightPixel, Miguel Moreira from Sierra, Fernando Maslé from MC, and Paulo Simões from Vorten. I'll start with the main highlights from our portfolio management this year. In January, Nosh agreed to acquire 100% of Clarinet Portugal with the aim of strengthening its ICT offering for the B2B segment, an important milestone in the company's strategy to extend its revenue streams. in may we reached an agreement to sell more and zippy our fashion retail banners that saw its closing in july this was a result of our active portfolio management and disciplined capital allocation approach during this year an mbo in which the management team basically got together with an investor to take over these brands later in august Sierra announced an agreement to acquire Unibel Rodanco Westfield's real estate management division in Germany. So this ensures that Sierra is now the second largest shopping center property manager for third parties in Germany. And this acquisition was completed in October. In December, MC agreed to sell its pet retail business in Portugal, Zoo, to Musti. And with this acquisition, Musti strengthens its position in the European market and expands to its seventh market. And also in December, Sierra agreed to sell its direct stake in Parque Dom Pedro, one of the largest shopping centers in Brazil. And this sale allows Sierra to streamline its presence in Brazil, exclusively through its investment in Alor. So quite an active year in terms of portfolio changes, which we believe are strong operations to enable us to face the future with more confidence. By being part of the Sonai Group, our companies benefit from value-creative opportunities to collaborate. And this is true in a number of different areas, namely stronger consumer value propositions, and also the unlocking of meaningful synergies across the portfolio. And 2025 was a powerful year for Sonai in that regard. Just a few examples that you can see on this slide. Vartan Life was launched as Vartan's loyalty program and with an integration with a broader continent loyalty card ecosystem, bringing clear benefits to consumers in a mutually beneficial partnership. As you recall, Continent Card is the largest loyalty program in Portugal, covering almost 5 million families. So this provides immediate leverage to Vorten's value proposition, while also reinforcing the strength of the Continent ecosystem. In the same context, Universo, our partnership with Bank Inter, relaunched the Universo Card, Universo Plus. Universal Plus brings additional benefits to consumers and also a wider integration with the Sonang ecosystem, namely with MC and Vorten. At the end of last year, Continente and NOS, together with Calp, launched Combina. Combina is the largest discount ecosystem in Portugal, enabling cross-company discounts and further strengthening the value proposition of our businesses. And we have, as you know, brought Musti into the portfolio recently. There's a number of synergies that have been extracted between our existing businesses or our historical businesses and Musti. You can see on the slide Musti's own brand being sold in our continent stores in terms of pet food. But there are also other areas of collaboration covering areas such as sourcing, supply chain, logistics, cybersecurity and sustainability, all of which are important areas for MUSTi and MUSTi has benefited from being part of the SONAI ecosystem. So all of these initiatives, along with many others that I could cover, make SONAI's companies more valuable. then they would get a standalone basis. And this is a key driver of our superior performance in recent months, and we hope in years to come. So now I will cover the results business by business, and then I will end with the consolidated figures for 2025. Starting with MC and grocery, the grocery segment delivered a remarkable performance in 2025. Turnover grew by 10% year on year, driven by more than 8% like for like growth. which was primarily volume-driven, and also the impact of the expansion of the store network. We opened 13 new food retail stores during the year, mainly in the proximity format. And with these results, Continuum strengthened its market share, so we increased further our market leadership in the Portuguese market, despite the very competitive market that we continue to face in the country. This top line increase, combined with a continued focus on efficiency, led to a further improvement in profitability, with the ABTA margin increasing 60 basis points from 9.6% at the end of 24 to 10.2% in 25. In the health and beauty segment, all banners continued to deliver strong results, Wells, Arenal and Bruni. Turnover grew by 55%, but this growth implies the contribution of Druni for the full year for the first time. But we had a solid like-for-like sales growth of 5.6% during the year and the opening of 42 stores, including four new Druni stores in Portugal. The underlying BPA margin improved from 12.5% to 13.1%, mainly reflecting Druni's profitability and higher operational efficiency. So overall, if you look at MC's consolidated figures, revenue grew 16% year-on-year, with a like-for-like of 8%. We reached €9 billion, almost €8.9 billion in the year, and the underlying VTA margin improved from 10% to 10.8%, an improvement of 80 basis points. This fantastic operational performance delivered solid cash flow generation, And this resulted in a further reduction of net debt to the EPA from 2.9 times at the end of 2024 to 2.3 times at the end of 2025. As for Vorten, Vorten saw its turnover increased by 7.5%, supported by a solid like-for-like growth of 6%. This performance was driven by the increasing relevance of the digital channel that outperformed the physical channel. Online sales today weigh roughly 24% of total sales at Wharton. We saw strong performances in the core appliances and electronics categories and also a continued growth of the services business line. Vorten reinforced its market share in 2025, consolidating its leading position across an omnichannel value proposition. And profitability was under pressure, if you recall, in the first few quarters of the year. But in the last quarter, we saw profitability already at the same level of 2024 with a 7.1% EBITDA margin, which reflects the impacts of many mitigating measures that were implemented throughout the year to counteract some of the cost pressures that we saw at the start of 2025. Finally, a word to say that we've implemented significant management changes at Orton with a new CEO being brought in in October, followed by adjustments to the company's executive committee and board composition, and which positioned the company well to deliver solid results in 2026. Now, regarding Moospeed, the company reported its results to the markets in early February. and has been strengthening its position in the Nordics and expanding geographically into other countries, namely the Baltics and, more recently, Portugal. As you can see, the company saw strong growth in 2025, 14% on a comparable basis, with a solid like-for-like growth of 3.3%, with particularly strong performances in Norway and Finland, and also in ZOO in Portugal, although ZOO does not consolidate into most of these accounts until the very last stretch of the year. Profitability has been registering a progressive recovery. We hit 12.2% of the BTA margin at the end of 25, but with a growing performance throughout the year. Gross margin improved from 43.6% to 44%. And we are seeing costs becoming more under control as months go by, as we expect the CBA margin to continue to increase going into 2026. Regarding Sierra. and sierra had an important year in terms of the milestones strategic milestones as i mentioned before we had some important portfolio moves namely the acquisition of rem in germany and also the sales that directs taken part from pedro at the end of the year but if you look at the operational performance of the shopping centers we saw very very positive results during 2025. Our shopping centers maintained an occupancy rate of 99%, almost full occupancy. Tenant sales were up by almost 5% on a like-for-like basis, and we saw robust rent collections from the tenants in our shopping malls. The company also advanced in key strategic expansions and refurbishments in its shopping centers. while continuing to recycle capital throughout the year. And overall, Sierra generated 114 million euros in total value. NAV actually only went up by 66 million, but that's because the company paid dividends to Sonai in the delta between those two values. But overall, it was a very positive year for Sierra, not only in terms of operational performance, but also in terms of strategic milestones that were achieved throughout the year. Now, moving on to NOSH. NOSH has also already published its results, as you know. It's continued to deliver a very solid operational performance, despite a very competitive telecom environment in Portugal, particularly in the B2C segment. Overall turnover increased by 2% to 1.8 billion euros, while EBITDA after leases grew by 4% to 680 million, leading to a margin improvement of 90 basis points to 37.3%. This performance reflects a diversification of revenue streams, as the additional pressure on B2C has been countered by a higher growth in the B2B segment, namely given the strong growth in ICT services following the acquisition of Clarinet Portugal in early 2025. This strong top-line performance, coupled with strong operational discipline as well and very strong efficiency gains, has led our margins to increase this year once again. Net income reached 246 million euros in a year. This was actually a decrease versus 2024, but only due to very positive one-off effects that we had in 2024 from asset sales, tower sales to sell next, and also some one-off cash proceeds from regulatory purposes from Anacom, excluding these, net income actually increased by 55 million euros on a comparable basis, and in some isolated accounts, NOSH contributed 92 million euros in our equity method results in the full year. As for BrightPixel, the company ended 2025 with more than 50 companies in the portfolio. It was a record year in terms of investments, 68 million euros deployed in existing follow-on investments, but also new companies. In total, we added 11 new companies to the portfolio. NAD stood at 318 million euros. Slightly down in some investments driven by exchange rate fluctuations, portfolio evaluations, and some portfolio reconfigurations. Moving on to the consolidated view. Overall, our consolidated turnover grew 14% to 11.4 billion euros, driven by the strong performances of our retail businesses, which more than offset the deconsolidation of Mo and Zippy, which contributed to our full-year turnover last year. On a comparable basis, excluding the impact of M&A activity, turnover growth would still have been 9%, so it's quite solid for the size of the group. Underlying EVTA grew by 24%, mainly reflecting the stronger operating performance at MC and also the accretive contributions from the recent acquisitions. By year-end, underlying EBITDA margin rose from 9.1% to 9.9%, an improvement of 75 basis points. Consolidated EBITDA increased by 18% year-on-year, supported by the solid underlying EBITDA performance, and also higher contributions from equity-accounted businesses, particularly Sierra and Universo, that had a very strong year in terms of operating performance and operating profitability. This growth came despite the overall lower contribution from NOSH due to the extraordinary results that we had last year. And also, despite some one-off costs that we had at the end of 2025, including 13.5 million euros linked to a price adjustment in the acquisition of Druni at MC. And so we had a small price adjustment to the acquisition of Druni because a year had passed since the original investment. We had to register that as a one-off cost in the P&L. and also some restructuring costs at Vorten that we also accounted for at the end of 2025, and M&A-related costs at Sierra, given the two transactions that Sierra executed at the end of the year. I would like to stress again that these are all one-off costs which we do not expect to be repeated in the future. All in all, in 2025, our net results grew by 11% in the year to 247 million euros, This result would have been higher if not for the impact of some unfavorable FX trends, namely the US dollar euro FX evolution, as well as some prudent year-end asset revaluation decisions. Again, these impacts are all one-off, and we do not expect any significant negative impacts in the near future. The strong operational performance generated 265 million euros of operational free cash flow, This, together with a more limited impact from M&A activity compared to last year, which included major acquisitions at the time, such as mostly BCF and Bruni, enabled further progress in our deleveraging path. We reduced our net debt by more than 100 million euros at the end of 2025, and our loan-to-value reduced from 15.9% at the end of 2024 to 13.7% at the end of 2025. And we expect this deleveraging path to continue in 2026. In total, our net asset value grew by 15% in 2025, reaching more than 5 billion euros at the end of the year. This is an achievement we are very proud of because it translates very clearly the value creation that we have been able to achieve in several assets in the portfolio, a result of consistent, solid operational results quarter after quarter, and also a reflection of the quality of our assets, namely our real estate assets at Sierra that continue to appreciate. On a per share basis, NAV reached 2.62 euros per share. With the appreciation of SONAI's share price in 2025, the discount between NAV per share and the share price narrowed significantly from 60% at the end of 2024 to 38% at the end of 2025. And today that discount is even lower, but there's still room to grow and we are still committed to reducing this gap going into the next few months. The Board of Directors will, in compliance with SONAI's dividend policy, propose at the shareholders' annual general meeting a dividend of 6.2 euro cents per share, so a 5% increase year-on-year, as is normal in our dividend policy. And basically, this is all for now. Thank you, and you can now open the session to Joanna.

Thank you very much, sir. Ladies and gentlemen, once again, you can ask questions by pressing star one on your keyboard, and you can also submit questions using the chat feature of the web and pressing send. So that's star one if you wish to ask an audio question, and you can also send it by chat. Our very first audio question is coming from Luis Colaco of J.B. Capital. Please go ahead, Luis. Your line is open.