Ströer SE & Co. KGaA

Thank you very much. Dear investors, dear analysts, welcome to today's Q2 and H1 2026 earnings call. Let us dive straight into the numbers and details. On the top line, revenues in the first half amounted to 1 billion and 37 million euros, compared to 980 million euros in the prior year period. On an organic basis, growth accelerated from 0.5 to 2.7 percent While on a reported basis, revenue grew by 6%. Moving down the P&L, EBITDA adjusted reached 273 million euros compared to 266 million euros last year. This represents a 3% year-on-year increase. On EBIT adjusted, we reported 150 million euros up from 109 million euros in H1 2025. This corresponds to an increase of 6%. Net income adjusted amounted to 56 million euros compared to 52 million euros in the prior year period. This translates into a 7% year-on-year increase. Turning to cash flow, free cash flow adjusted remained broadly on the prior year level. For the first six months, we reported minus 1.9 million euros compared with minus 1.6 million euros in H1 2025. Christoph will elaborate on this in detail later in the final section. Finally, CapEx before M&A amounted to 51 million euros, up 12 million euros as of H1 2025. On market dynamics, first let us have a look at the news numbers for Q2 of our local German peers in the middle of the chart. As always, please keep in mind that these show gross and that net revenue growth is on average 6-7 percentage points lower. On this gross basis, the German advertising market increased by 1.9% in Q2. OOH grew by 8.8%, clearly outperforming TV at minus 1.1%, print at minus 4.5% and radio at plus 2.9%. by desktop and mobile grew by 15.3%. Against this market backdrop, our autoform media segment delivered reported net revenue growth at 10.3% in the second quarter. Within the segment, DOH increased by 24.3% and the DOH subcategory programmatic digital autoform by 45%. The half-year picture confirms the same structural trend. The German advertising market increased by 1.1% on a gross basis, with OOH up 5.6%, ahead of TV at minus 0.3%, print at minus 0.9%, and radio at minus 0.5%. Desktop and mobile increased by 10.9%. Our age media segment achieved reported net revenue growth at 8% in age 1, while DOO age grew by 18.5% and programmatic was up by 29.3% in the same period. Driven by the strong development of Steuer, the share of out-of-home advertising increased to 10.7% of the German advertising market, according to Niesen. So far my remarks. And with that, a hand over to Christoph.

Thank you, Udo. A warm welcome also from my side. A very good morning to everybody. Thanks for having me today. Let me immediately start the finance section with a quick look at the Q2 2026 P&L. In total, we delivered a solid set of results for the second quarter. Group revenue increased by 7% to 542 million euros compared with 505 million euros in Q2 2025. If we exclude exchange rate and consolidation effects, the organic growth came in at 4.2%, which is an improvement of 6.5 percentage points year over year. The adjusted EBDR amounted 154 million euros, 4.9 million euros or 3% higher then the same quarter in 2025. Exceptional items for the quarter were minus 9.5 million euros compared with minus 3.7 million euros in the prior year period. The increase resides mainly from our internal reorganizations. Accordingly, the EBDA was 144 million euros stable compared to 145 million euros of last year. Depreciation and amortization are virtually unchanged at the level of 83 million euros. EBIT came in at 61 million euros compared to 62 million euros previous year. The overall financial result was minus 19 million euros against minus 16 million euros in the prior year period due to an higher average debt level compared to the previous year. Accordingly, earnings before tax came in at 42 million euros compared to 46 million euros. The tax rate is unchanged at 29.9% and the tax results amounted to minus 13 million. All in all, reported net income for the quarter came in at 29.7 million euros compared with 32.3 in Q2 2025. The total adjustments amount to 8.6 million euros, mainly reflecting exceptional items and additional reconciliation factors shown on the slide. The adjusted net income increased by 7% to 38.3 million euros from 36 million euros. Let's now switch over to a view on the cash flow. In the first half of 2026, operating cash flow flow improved to 161 million euros compared to 146 million euros in the previous year, primarily due to the better working capital development, which came in at minus 13 million euros compared to minus 31. The positive development overcompensated high tax outflows, which amounted 36 million compared to 32 in the previous year. Investment cash flows for the first six months amount to 51.2 million euros compared to 39.6 there was an exceptional investment in real estate. As a result for free cash flow before M&A there was 110 million euros in the first half year of 26 compared to the 106 of the previous year after lease liability repayments which slightly increased compared to the corresponding Thank you very much. The remaining difference in the reconciliation of around 7 millions relates to a reduction of accrued interest liabilities paid in Q2, representing a cash flow with no effect on net debt. Net debt year over year was up 40 million euros to 996 million including accumulated free cash flow over the last 12 months of 106 million euros cash out for dividend payment of minus 115 and the share buyback volume of 23 million and 4 million earn out payment on minor M&A activities. With that, Our bank leverage ratio increased to 2.6 times compared to 2.47 times at the end of June 2025, reflecting a higher net debt and a slight decline in the earnings contribution used for the calculation. Then let's have a look at the performance of the individual segment. As is customary, let's start with out-of-home media. During the first half of 2026, segment revenue increased by 8.1% on organic and 8% on a reported basis to 492 million euros and outperformed the German advertising market significantly, as Udo already pointed out. As in previous quarters, digital out of home again was the key growth driver, increasing by 18.5% to a total of 207 million euros. supported by programmatic demand and also the FIFA World Cup which took place in June which accounts for approximately 12 million euros in this segment. Classic out-of-home revenue was 1% lower at 253 million euros. Services increased by 26.7% to 32 million euros driven by the newly won clients as mentioned in our last call. EBITDA adjusted for the segment increased by 10.3% to 224 million euros for the first half of the year and EBITDA adjusted margin improved by 0.9 percentage points to 45.6 during this period. Looking on to the adjusted EBITDA before IFRS 16, this increased over proportionally by 23% to 115 million euros The corresponding margin improved 2.9% to 23.4%. From a Q2 perspective, basically the same picture emerges. Total revenues of the segment were up 10.3% to 270 million. With digital out-of-home SMI and gross driver EBITDA, it just came in at 128 million euros compared to 170 million euros in the prior year period Q2. Then let's have a look at digital and dialogue media segment. The first six months, the segment revenue increased by 5.4% on an organic and by 14.4% on a reported basis to 476 million euros. Digital revenue was up, reported by 2.6%, while dialogue revenue increased organically by 8%. On a reported basis, considering the additional revenues coming from Amevida acquisition, you remember last year, The dialogue was up by 25.5%. The adjusted EBDR declined by 4% or 2 million euros to 57 million euros for the first six months of the year. The corresponding margin decreased by 2.3 basis points to 11.9 mainly due to a shift in product mix and higher minimum wages in the very personally intensive dialogue business. From a Q2 perspective digital dialogue revenue increased by 16.6% to 245 million digital revenue grew by 8.3% to 113 millions as the strong performance of the programmatic digital out-of-home category more than offset the challenging online media market. Dialog revenue increased by 24.9% or 7.4% on an organic basis to a total of 131 million euros. The adjusted EBTA of the quarter came in at 30 million, just a million euro lower compared to the previous year period. The corresponding margin was 12.2%. Last but not least, let's also have a look on the performance of Data as a service and e-commerce. As expected, the performance in our third segment remained below the prior year level. Segment revenues declined by 11.2% to 156 millions. In e-commerce, revenue was down by 10% to 83 millions and it still reflects low consumer spending in Germany in that specific field. Data as a service revenue was 12.2% below prior year revenue of 82 million and came in with 72. Adjusted for the disposal of Statista's strategy and consulting unit which we reported and also negative currency effects the organic revenue decline amounts 4.4% year-to-date. The adjusted EBITDA was 11.4 million euros for the first six months down 43% and the corresponding margin logically is also down 7.3%. If we look at Q2, the picture is very similar. Overall segment revenue fell by just under 9% from 85 million to 77 million euros. Data as a service recorded revenues of 36 million euros down 11.6% and e-commerce achieved revenues just under 42 million euros, a decline of 6%. These downward trends logically also reflect in the performance of the adjusted EBDA and the adjusted EBDA margin with 6 million euros and 7.5% respectively at the end of the quarter. Having given you an overview on the details of the financials, I'd like to hand back to Udo for his remarks.

Thank you Christoph. Before ending the presentation, let me provide some comments. and the outlook for Q3 and its current trading momentum. For the third quarter, we expect the following developments. For OOH media, sales should grow in a mid-single-digit percentage range. For digital and dialogue media, we expect sales to grow broadly in line with the developments seen in Q2 2026. For darts and e-commerce, we expect sales to continue to decline in a low double-digit percentage range. Against this backdrop, we confirm our full year guidance for 2026. Let me now close the presentation with a short look into our financial calendar for 2026. Our next scheduled reporting date is November 12th. On that date, we will publish our Q3 2026 quarterly statement. As always, updates, reports and roadshow presentations can be found on our IR website. Thank you everyone. We are now happy to take your questions.

The first question comes from a line of Annick Aas from Bernstein. Please go ahead.

Good morning. So I have three questions today. The first one is on Statista. Can you give us an update on where we are in the business model change that you've been trying to push through in Statista? Can you just tell us where we are, how this is developing? The second one is you're mentioning at some point that the product mix in digital and dialogue is impacting your margin. Can you just elaborate a bit more what was that specifically? And then I guess there's been again some bit speculation around Ströer. Would you be able to comment on it or not? Thank you.

Statista, we are completely in line to what we said three months ago, so nothing much changed. We changed the business model from selling seeds to volume and this takes some time because obviously our clients need to implement a company GPT first, then they connect their own data pools and then they decide which third-party data pools they connect as well. to their own AI backbone. But everything is actually unchanged. We are going through a year where we're going to see difficult developments on turnover, because as we already discussed last time, all the long-tail demand where people, whatever private individuals have a question, this is actually declining, obviously. But on the The corporate side, things are looking pretty much the same like three months ago. So we are in the middle of the process. Before Christoph answers the second question about speculations, there's nothing new. I think we said everything about the rumors, but there's nothing we have to add now.

Let me maybe add one more thing on the On the Statista thing, Udo described that this has changed. We have first B2B customers, which we changed from a pure subscription to a tokenization model as a test, and it turned out that the total revenue with these customers remains about at the same level, which is a very positive signal at this stage. It's a first test with first customers, but I think looking at it pure financially, this is a promising first proof of concept. You've asked about the product mix in the dialogue business. Well, let me split it. Dialogue Ranger as well as the call center. Mix in the call center is that you are well aware that we have German activities and we have near-shore activities in southern regions of Europe. Part of the mixed changes is that we relocate business there. That is not only on internal purposes, but also on demand. And these things have an effect on individual revenue, but also a little bit on absolute margin. That's part of it. Second is that in Amevida, we've also seen that with In the early stage, we just took over the clients. Now we're resorting it. We are rearranging the calls, et cetera, et cetera. I think that also has an effect. So it's basically driven by internationalization as well as some client changes. On Ranger, we are still the core business in Germany is on fiber. In Italy we are working with a lot of energy contracts or electricity and this is a weak market at this stage given the macroeconomic environment. So these are two drivers of the changes that you were mentioning.

Thank you very much. The next question comes from the line of James Tate from Goldman Sachs. Please go ahead.

Thank you. Good morning. It's James Tate from Goldman. I've got two questions, please. I guess firstly, on out of home, please could you comment in a bit more detail on current Q3 trends? How much of a benefit is there from the World Cup in July? And how does the order book look for September versus August? And secondly, on data and e-commerce margins, I think they're down around three percentage points year-on-year in Q2. So could you provide some color between the individual performance between Statista and Assam Beauty Margins? And then how should we think about margins and profitability in this segment into 2027? Do you think you can return to 2025 margin levels if the division returns to growth? Thank you. Yeah, thank you, James.

So look, we are not focused on As we talked about it many times on quarters for the full year, if you look back at the end of the year, I think we see that some business from Q2 most likely will have moved to Q2 because of the World Cup. So that's why we explicitly figured out here the 12 million from our expectation. was money which normally would have been spent in the second half of the year and was put forward to Q2 due to the World Cup. So I think Q3 looks definitely a bit softer than Q2 because people's budgets are the budgets and if you spend it in Q2, you cannot spend it in Q3 anymore. But for the full year, our expectations are completely intact. If you look to the order book now, then we see a positive development in Q4. A little bit softer Q3, so that's what you are seeing right now.

Can you repeat your second question because I didn't fully get it?

In terms of DAS and e-commerce margins, I think have been under pressure through H1. Could you help give some color between the individual margin performance in Statista and Assam Beauty? Sort of what's driving that segment level margins and how to think about margins in this segment overall into next year, into 2027?

Yeah, I think as Udo pointed out in Statista, we're changing the model. So what's actually happening there is that we are trying the big and long tail market here is the big B2B market. It's not the subscription of small individuals. And we are changing that into a tokenized version versus a kind of a flat fee usage on a monthly basis. As I pointed out, that is Not only work in progress, but it's tested with some customers and gives us positive signals. Overall, the Statista business, as we all understand, is a software as a service. So it's highly driven by volume and scale. We have brought down the staff even further. And we are stabilizing on the current level in terms of margin that we've shown in Q2. and I would expect for the next three to four quarters a similar level before we hook up again, changing the model and having fully established. So if I would model it, I would say like, let's stick to the current margin level for the next three, four quarters and then ramp up again. But it's difficult to say how fast the ramp up is going to be. On Assam Beauty, I mean, giving a bit more color, the business originally, as you're all aware, comes from TV sales. That has come down. The target group is aging and they seem to have bought enough, if I may say it like that. And the now biggest proportion of sales is in e-commerce to a younger target group. and also in retail, which means that we ship to German retailers. By definition, what are the major margin drivers? Cost of goods are always the same, independent from the channel. On retail, we live with a lower margin because high volume but lower margin and we have to invest into furniture. and we are as you are familiar with in like Drogeriemarkt and Rossmann and these kind of big chains. We're doing well there, but this is a lower margin than typically the TV and the e-commerce sales. And on e-commerce, we see that the actual conversion for people coming into the website is fine, but bringing in new customers is more expensive. and we talk to our agencies and we look at our own online performance activities. In the online we see that it's just a fatigue of the consumers in Germany right now. They're a bit slow. On top we have 35 degrees which is not really the time to buy beauty products and makeups, which is our key product in that range. So here again, I would expect a recovery from the current downtrend in 2027, first half year. And once again, I mean, fixed costs will stay the same. So margin improvement will start step by step in the next, like I would say, starting Q1 and Q2, step by step. We now have a question from the line of Jérôme Baudine from OdoBHF. Please go ahead.

Yes, good morning all. Three questions on my side just to follow up on the... Hello, can you hear me?

Yes.

Can you hear me?

Yes.

Can you hear me now?

Yes.

Okay, sorry. Yes, sorry. So three questions on my side. Can you hear me? Yes. Hello, hello.

Loud and clear.

Okay, it seems to have a delay between my line and yours, so let me go through. So first question on the advertising trend. to follow up on the last question. So on the last call you said that the second half should be stronger, and now you guide for mid-single digit in Q3. So just to understand if your view has changed and H1 has been better so H2 will be lower, or should we expect a much stronger Q4? That's my first question. Second one on the OOH margin, so revenue grew by 10% and cash EBITDA grew by 18%. Should we expect this strong operating leverage to continue in H2? And maybe could you also comment a bit on the rent evolution since the beginning of the year? And last question on the Ad Manager project. So you said earlier that the first test of the platform was going live. So could you give us an update? And what do you see in terms of customer demand and average spend? Any data would be useful. Thank you very much.

Thank you, Jerome. So the Ad Manager, we are testing, let's say right now, three models. Self-service models, but this is not the ad manager. The ad manager will not be ready before the end of next year. That was maybe misunderstanding. So we have now, we are testing a self-service tool for For cultural advertising, for example, it's more or less a simple web shop. And on the other hand, we have a self-service tool for digital out-of-home, which we rolled out like three, four weeks ago. And our own sales staff and our customers now collect the first experience. But this actually are, let's say, we test environments that have nothing to do with the ad manager. So the ad manager, we are We are on track with our coders, they're working hard. We have, maybe we discussed it one time, we have coding teams in Czech Republic and also New Zealand and Spain. And so this was a very experienced team which was working on the FSP. For a long time, you might remember, we have our own SSP and now this team is actually working on that manager. But it will take until the end of next year until we have it really up and running.

Okay, the other questions, you asked advertising trend and that translated in you wanted kind of like have a view on current trading again on Q3 and Q4. I mean, I think The current picture for Q3 and Q4 perfectly matches our guidance. The order book for the third quarter and fourth quarter is up from previous year and we said that we're going to be above 5% growth and definitely we see the same trend. So I would just like to extrapolate the first half of the year, which isn't fair for the rest of the year we've just had. Reviews of July and that proves perfectly fine. Second question, if I got it right, was your question on revenue to margin impact in out of home, whether this is a stable one and the 10 to 18. is a fair assumption also for the upcoming quarters. Yes, I would reconfirm that by definition this business, I mean, the next extra euro that we take in on existing inventory basically costs only the revenue share or rent and no additional cost either in technology or working capital. So step by step, it improves with marginal revenues. But I think the current spread is a fair one, which we also internally use for our extrapolation. and the third one you've asked about the development of rent. Well, I think it's a bit of a hard question because we are not reviewing rents on a daily basis. We are changing rents with new concessions and we either invest into technology and discuss that with our landlords or with our concession partners. Overall, our ambition is to bring We see that city governments prefer a bit higher guarantees but are then ready to let go on their revenue share. We have seen that in Hamburg, for example, which we recently won and we have extended Our reach there were very successful in the latest auction. So I think overall the rent will come down, but given the total volume of 300,000 individual advertising locations, you will not see a big step down in a single year.

Thank you very much. Thank you.

The next question comes from the line of Craig Abbott from Kepler Jodreux. Please go ahead.

Yeah, good morning, Udo, and good morning, Christoph. Yeah, first of all, on the financials, I mean, we saw the leverage ratio increase to 2.6. Of course, Q2 is typically the highest given the payout, dividend payout in that quarter. But I'd like to get an idea basically of ideally where you want to see that leverage ratio by year end. Secondly, a little bit just more conceptually going forward, you know, Stewart is now investing quite heavily in the rollout of these mega outdoor screens like you have on slide one of your presentation. With the 3D dimensions, you've got the lighthouse in Hamburg and the new one in Cologne, I believe. And I'm just curious if the overall capacity intensity If out-of-home media is structurally likely to rise, and if so, how might you consider managing this with regards to your capital structure? My third question is just briefly, any update you could provide us on the more permanent long-term CFO search? Thank you.

Thank you, Craig. So CFO search is an advanced stadium So we should see, let's say, results in the next four weeks, I would say, most likely. We had a long process now already, and we are quite happy with the candidates that we have. So for the second question, there is no risk for the capital structure because we are really happy now that we could launch three, four, SuperScreens at the same time or the same year. But for example, the whale in Hamburg, it was a 10-year preparation work. Lighthouse also a couple of years. And the capacity of these type of screens are super limited. So there will be no impact on CapEx because if you would be able to install There are many such spectacular screens, let's say in a bigger number we would do it, but it's not possible in Germany.

Because there's only restrictions, you mean?

Yeah, it's very conservative in planning, the country. It's not Korea or China or America. So Europe is generally very defensive. For example, in France you get almost nothing still. and UK is the most developed market up to now and so we are ramping up stream by stream but it's always a hard work and in administration they only change ways step by step the view how they look on that so the lighthouse yes what you see on the front page is a spectacular screen and we have another screen at the same square here And so it's a very exciting launch product, what we call the landmark, where you can render two screens plus a square plus space inside of the clubhouse here. But again, this is an exception. We've worked for many years on that. And if we have at the end 10, 12 iconic screens in Germany, that would be a really good result.

If I may just follow up real quick on that, I'm sorry. Are you happy with the returns you're seeing on those boards or is it more a marketing campaign, if you will, for the digital out-of-home medium overall?

No, the return is spectacular. I don't go into details now. The return is very strong, much higher than average return on an average digital location. Okay, thank you.

And if we look at the bookings for the first months of the whale, we also see that we attract new customers. And we also feel that this innovation is creating more demand. So I think it has also, as you said, has good returns, but it also has a branding effect and the marketing effect for out of home as such. Maybe also fair to add that we are not planning or including exceptional cutbacks for any of those DRR in our basic planning included. The other question that you had was on a debt ratio. I mean, I think the debt ratio by the end of the year will be around 2.35, so a bit higher than previous year. But going down again, I think we're working hard on We now have a question from the line of Julien Roche from Barclays. Please go ahead.

Yes, good morning. On the article in Manager Magazine that had a lot of detail, this is the fourth M&A rumor on Streuer. Last time, at the third rumor, I asked you, Udo, and you said, don't believe everything you read in the press. And you answered any question as nothing new. So are you saying don't believe what you read in the price or is the message different? That's my first question. On the World Cup in Q2, just to make sure it is 12 million because I thought 12 million was the whale. That's my second question. And then the third one is can we have a breakdown of Statista 25 revenue between corporate and retail long-tail and is that the right way to split the business?

Thank you Julien. So 12 million is the right number. for what you see as World Cup effect. But this is not, let's say, on top money. This is money which comes from most likely from Q3 to Q2. So people have the budgets and if there are certain events in the year, they allocate budgets to the events and move it from somewhere else. So that is what we expect. But let's see. Let's see. For your first question, I'm sorry to say I can nothing add here. There is a lot of speculation, but we're doing our job here and that's all we can say right now.

The third question was? We are not planning to disclose the details and the breakdown. because we would have to add lots of definitions on that so please accept that we will not do that for the time being.

Okay and then maybe a follow-up question is CapEx was up because you said there was some real estate investment.

We bought some land which is close to our headquarter basically in front of our headquarter here in Cologne. We are planning to Bring more people back to the center. We have a spread out real estate or office infrastructure in Cologne as well as Düsseldorf. And mid-term and long-term, we plan to bring them all together down here. We bought land across the street for 9.8 million euros.

And so does that mean you're going to also have further capacity to basically build a building?

Yeah, but building in Germany means you do a pre-question, then you do pre-planning, then you do ask for the changes. So we're talking nothing in the next two years. But it's safe to have it.

and if we run out the long lease contracts in other places we will review that.

As a reminder, if you wish to register for a question, please press star and 1 on your telephone. The next question comes from a line of Anna Patrice from Berenberg. Please go ahead.

Yes, hello. Thank you very much for all the questions answered so far. Just a few questions from my side. If you can comment on the progress of the share-by-back, please, and if there are any plans to accelerate to increase the share-by-back. That's the first question. The second question is on their capex. I understand that the increased capex now is due to the real estate investment, but if you can comment on the capex trends across different divisions, if the capex is up or down in the e-commerce and in the statistic, and how much the capex spend is now out of home and what we should expect going forward, please. And then the comments on the Q3, you expect single-digit increase in out-of-home based on the booking you have right now. So there might be still some kind of mixed trends with pulling forward some advertisements because of their World Cup, but still World Cup was ongoing in Q3, so there should be also some support. So what do you see as underlying trends in the out-of-home? and what would you expect is underlying so adjusted for all their World Cup events for the out-of-home. Thank you.

Well, let me start with the buyback. We've spent so far 21 million, which was close to 690,000 stocks at this level, which is currently for sure also supported by the speculation. We are not planning to continue, but we have an obligation to have a look at it. But we are not obliged to spend the money. So far it was 21 million, as we reported on our website. and next steps would only be done if the share price was dropped significantly under the current level. For the total year capex, we expect a total number of 104, which is a remainder of 52 for the second half of the year, so similar level as 2025.

For the underlying trends, I mean there's I think everything said in our statement here we see unchanged trends and we are not big fans of analyzing single quarters because I mean if people are moving campaigns from one quarter to the other you see directly an impact on the quarter but have nothing to say the question at the end you see underlying positive development for out of form and I think this is around the world everywhere the same situation slightly up, slightly down in different markets depending on specific development in these areas. But underlying demand is unchanged positive. I'm not sure if this was the answer you expected.

Thank you. No, that is fine. Thank you very much. Just to understand on the CAPEX trends, what are the trends on the CAPEX at the out-of-home? Do you expect the increase in the CAPEX or it's pretty much stable as last year?

No, pretty much stable as last year. As I said, also the bigger ones that Udo mentioned, they will be always covered by the existing plans. We take opportunities, but this is a... The decision on a conversion into digital is not a decision that we can take ourselves and then move on the next day, but we have to discuss, prepare, do technical planning, etc. So this is why we have a 6 to 12 months roadmap which we can perfectly analyze and that says that we will remain on the same level as we were on 2025 and will be on 2026.

Thank you very much. Once again, to ask a question, please press star and one on your telephone. Ladies and gentlemen, there are no more questions at this time. I would now like to turn the conference back over to Udo Müller for any closing remarks.

Thank you very much. Happy that we could answer all your questions and we're looking forward to hear you back in November. All the best.