Thermador Groupe Sa

Good evening everybody. Good evening. So welcome to this annual appointment because annually because we're going to present the results for 2025 during this webinar and it's going to last one hour. So it's a primary for institutional investors. and which is disseminated in French and in English because we have Neil who's here to translate simultaneously into English and there are also English language PowerPoint slides. We've also got Baptiste who's there on the chat help you so don't hesitate to ask questions either in English or in French and we'll try to answer those questions in the second part. You certainly receive both the letter to shareholders number 122 in digital format and maybe even on paper and the universal registration document which went online yesterday and is therefore available to you already and you know we're one of those companies that publishes the results in the same time as the AGM to give us the chance to talk to them with you about it. So 903 people in our workforce reflects stability to constant scope even though it is an increase in numbers but we've received two new companies Equinox and C2AI and that represents the difference of 72 people who've joined us. So thanks to all our employees who've worked hard in what continues to be a difficult context and we thank you for their commitment and their efficiency and professionalism in their work for the group. So milestones for the year in building You know, this represents about 41% of our turnover overall. We suffered from the funding of energy renovation in the market, you know, that is funded partly by the public authorities, with the MaPrimeRénov' scheme, which has been going down and down over recent years, particularly in 2025. And for a period in 2025, the actual funding was blocked for a time, so it makes things very difficult for energy renovation and those companies involved in innovation to progress. So in terms of new housing, which is maybe 10% of our total turnover, we have not observed any real recovery in the new housing market. We'll see what happens in 2026, which looks a little more positive. In terms of the water cycle and our businesses involved there, we've had companies decline into and over, others the opposite. Jetly, which is involved in water harvesting and watering systems, and the treatment of wastewater, a slight decline in turnover. DPI also saw its turnover down. It's pipework for water, both in terms of reductions in volumes and reduction in prices. However, our company who works in the swimming pool market did very well, Aiello, with an increase in turnover and some substantial gained market share. And for Sovraco too, which had a good year in the water cycle market, supplying Les Suez, Veolia, the big specialist involved in water in France. In terms of industry, all the companies that you see in the letter to HL, there's number 122. the first page this is a complete table of all the companies of the group and all the companies which are from spherical down they have a level of resilience in terms of turnover growth or slight growth or stability you see that all our companies working in this sector are done well again this year in 2025 and where market shares are still available, of course, to our companies. Internationally, variety again, with good achievement for companies like Safeco or Sodico, and more difficult times for the subsidiary of Odria in Spain, which lost quite a bit of turnover. in particular for bathroom taps, that's Rousseau, also declined for FG Inox. Globally, internationally, growth continues because the share of international sales as the share of the group has increased from 16.3% to 17.3% this year. The retail segment, that's where we had the most trouble, with the decline in turnover for our two subsidiaries involved in those markets, but particularly Odria, which has also faced delisting for outlets, retail outlets in Spain. Okay, the price impact is negative, slightly negative at minus 1.4%. We'll talk about that in outlooks, and we'll talk about the outlooks later on. We've got the acquisition of two companies, C2AI and Kilinox. This is on the commercial side, on the terms of our business. So regulation of fluids and instruments, instruments for the regulation of fluids. specialized in temperature probes and this company in 2025 did around 10 million, that's C2AI and the other company that we acquired, Kirinox, based in Spain who deliver stainless steel equipment to the pharmacy industry and agri-foods and chemical industry and cosmetics. and they do approximately 15 million turnover per year, so they join us on the 1st of October. For information, more detail about those acquisitions, you'll be able to find that in our URD. In terms of governance, we've decided to, at the end of the year, and we communicated about this at the beginning of 2026, we've tried to separate the roles of chairman and CEO. and the last two sections on social and environment we'll be talking about that in more detail a little later on social and economic governance so overall when we look at turnover in terms of distribution channels so retail and pro it's clearly in the retail channel that we've lost substantially minus 10.9% whereas In the Pro channel we've showed better resilience with a drop in 1.1% to constant scope and that gives an overall decline to constant scope of 2.9%, 1.4% of which is for DPI. So look at turnover and profit of the next 10 years. If we look at the post-COVID period, we see that we've got good resistance in this transitional year of 2025, both for turnover and profit, you see compared to 2024. In terms of organic growth by quarter, we're still waiting to switch to the other side of zero, the break-even point. We were disappointed by the last quarter with minus 1.7%. We're hoping that for the first quarter of 2026, we'll see that go above the line, the zero line. So for this volume from 2021 to 2025, I'd draw attention particularly to the orange bars. And if you look at 21, 22, 23, we had strong inflation, 4.3, 10.8 and 5.9. And then two years of price drops. And over that whole period, however, there's an increase in 17.5%. So there again, we'll be having a word later about the price effect for 2026. So over to Patricia to talk to her about profitability. So looking at profitability between 2024 and 2025 and we know we've got stability in terms of turnover and stability in terms of profit. So at the end of the first semester of 2025 we were slightly behind but we worked substantially in the second semester and we were able to catch up. So the commercial margin, we were able to defend that pretty well over the year. And we benefited from a dollar impact, which helped us, which represent 32% of our sales are in dollars. So that had an impact on our profit and loss account. And of course, our commercial margin. And so with the work of the salespeople and the purchasing teams, we were able to work very efficiently to defend our margins. So between the pro channel and the retail channel, so stabilization in the pro channel, but in the retail channel, more exposed to purchase from Asia and a greater benefit from the dollar effect. So expenses, the percentage of net turnover is over now 25%, so 25.2%. The biggest expense is personnel, of course. And as Guillaume said, we've maintained our headcount in 2025 compared to 2024. So we also increased salaries by 2.4%, so that led to an increase in personal expenses, which now represents over 13% of our turnover. In terms of operating profit, we've got the impact of Keynox and C2AE, who had a slightly higher level of charge, personnel expenses as a percentage of turnover. If we look first at the five, five subsidiaries represent more than 83% of our total turnover and three historic subsidiaries, Spheraco, Spheraco and Thermador. And now there's also Selectorial and Syfco who are now, have got to a critical size and and levels of profitability which are really contributing to operating profit of the group. So DPI, FCI and Thermacom, XLR and Thermacom, sorry, which are companies that are losing money. Thermacom with the drop in new builds. exposed to new housing market, so a 9.2% decrease in turnover and charges which were kept at the same level, so that didn't help, so it didn't compensate for the drop in turnover. So there's also an effect of an attribution to the customer receivables which has also affected the result. DPI turnover down also. So in terms of consolidation, they were down in terms of turnover. And then C2AI and Keylinux. So six months of results for C2AI, which was approximately the level we expected. But Keylinux, in terms of operating profit, We had to make a provision, a 100% provision for a fraud which was effected against the CEO of the company to a total of €398,000. So we decided to provision that to a level of 100% and that took away all the profit of the company. So we're not sure whether we'd be able to recover those amounts. So as a measure of prudence, we decided to make a 100% provision for it, which took away all of their profitability. So the difference between... We're looking now at the operating profit from ordinary business, which is... The impact can be explained. The financial result, which dropped slightly compared to last year, That's mostly due to a drop in the interest rates. We got high levels of cash in 2025, but we weren't able to compensate for the financial charges and the repayments through this level of... We also had two new loans. Also the tax effect, because we benefited from a tax... credit linked to what we call the bertho which is for the families and there's an increase in products which allowed us to to benefit from this credit tax which explains the the bigger drop than the operating result and then going on to the key indicators which are return on production and return on capital used employed sorry so the The ROP over turnover is maintained at 11.8% and if you look at the ROCE, 16.4% compared to 16.7% last year with the impact of CATA and the new companies C2AI and Canucks in terms of assets. We recognize in the books their assets and because we only had part of the profits from the year, that explains this drop from 16.7 to 16.4. Financial structure, next, in terms of the, our stock is the highest value we have in our assets, 175 million, which is down. both in terms of value and number of days of consumption, which are now at 203 days, which is the work of our stock valuation teams and adaptation to changes to the quantities actually sold. So better management. So we've got the impact of CHE and Kilinox. The drop would have been more without that. So the picture at the end of December takes into account the supplies that we've got on the boats. And so this year we've got 18 millions worth of stock on boats compared to 24 million worth of stocks on boats coming from China. The Chinese New Year was later than the previous year, so that helped us a little bit. In terms of cash, so record year in terms of cash at 96.9 million. And we have subsidiaries who are able to invest, of course, with this cash. And that generates financial earnings. So borrowings, in terms of borrowings and financial debt, we've got two new loans for a value of 20 million for CTAI and Kilinox. And so we've got fixed interest rate loans with no guarantees over a period of seven years. So we're in positive debt, net debt position. to equity, so that's thanks to our allocation to dividends and our profits which has allowed us to increase slightly there as you see. So the generation of cash flow, we've got the cash flow statement. We've generated 36.7 million of net cash flow. That's made up of results, which of course is converted into cash. Cash excess with investments are 5.1 million. So the most important impact there is the stock levels. So we used our cash to fund investments to the value of 5.1 million. We had announced 9.1 million in investments, but because of delays to certain projects, those That expenditure has been delayed to a later date. So we've got the 17.3 million is the net cash flow from changes in the scope from the two new subsidiaries. So that gives us 46.9 million in free cash flow. We paid out 19.1 million in dividends. We talked about the loan subscriptions for 20 million that we talked about and then repayment of our existing loans for 7.8 million. And the DPI investment is for the first time counted over a whole year. It's the first time we've paid back the DPI loan over a whole year. And the other element concerns IFRS 16 financing flows. Those are IFRS accounting rules. which represent a cash burn for us of 3.3 million. That concerns subsidies like Thermador because of rental activities. So moving on to investments. So over 2026 we'll be at a maximum of 2.3 million and we estimate it'll be somewhere between 9.6 and 12.3 million. So we've got major real estate products for about 6 million euros. We already talked about Sparco and there's also an automation for the logistics for an extension to an existing building for those logistics needs. And Sparco will have the the most advanced warehouse of the group. So we've started to pay some of those investments in 2025 and the construction will start for real in September. So this was a building we built for Servalico in Alsace and the works were started in the last quarter. And then look at the difference between the the investments and the real estate investments, the difference concerns investments which are paid for by our subsidiary directly, and there are many investments in the digitalization and that's mostly for our warehouses and that concerns invoicing, electronic invoicing and investments that we will need to make to be able to gain, achieve productivity gains in 2026 and 2027 and so I'm going to hand back over to to Guillaume for sustainability so we had an achievement rate of 102% achievement rate of our 19 objectives so you'll find all those in indicators on page 21 of our URD and if any of those indicators require any more explanations don't hesitate to ask us. So for the second year we've put together a sustainability result for CSRD which was read by the AMF, the financial authorities and they made a few remarks about it but we managed to complete this, respect this requirement with great results thanks to our teams who worked on that. We hope they will continue to publish in order to conform with this regulations. and they are required for companies over a thousand employees and we will benefit from the new simplifications brought in by the omnibus directive and of course Moving on to reporting in terms of progression in this area and particularly in terms of environment. The expenditure on salaries of people at the time dedicated to work on the sustainability questions was €686,000 slightly down on the previous year but because we've done so much work in the first year. So one of our 19 objectives, and a big one for us, is the decrease in absenteeism, because there is a correlation between absenteeism and productivity. So we've come down from a peak from 2024. But we're still a long way off our objective, which is to get below 4%. We believe that is quite possible because many of our subsidiaries are under 4%. So we're going to work with the subsidiaries which are reporting higher levels in order to meet this objective. And today we believe we have all the elements we need to do that. Next, on the agenda, 33% of women are on management committees, in terms of conformity, in terms of state sustainability. 32% on the extended management committee, which is represented by, which is comprised of 34 people, so all the corporate officers of the group and the head of sustainable development. 96.4% of our emissions are due to our products. So they're not products we manufacture but the products that we distribute. So you see that we have to do will be done over the long term with our suppliers. This year we followed a very strict process to establish and materialize a carbon trajectory and this process is called ACT step-by-step and it is one that's validated by the ADEME which is the French Environment Agency which gives us a reference on this carbon trajectory which we've modellised in a fairly precise way and that allows us to act upon it and control it and react to any drops or increases. Finally, a drop in our carbon emissions in absolute values, 328 kilotons of equivalent CO2. this is partly due to our drop in turnover and slight drop in volumes but in terms of the indicator on page 21 you see an increase because this indicator refers to carbon emissions per ton of products sold. So because of our product mix, we have two different results on that part. We talk about active products, which use energy once they've been installed. For example, heat pumps or ventilators with VMCs, mechanical ventilators. So a few words about outlooks. So in terms of new homes, we'll see the situation should be improving. The French authorities have understood the challenge of new homes. with an objective which is going to be clearly difficult to achieve, but their idea is to build 2 million new homes by 2030. And even though that only represents 10% of the group's activities, that will help our subsidiaries like Thermacom in the last part of 2026, but more likely in 2027. So, energy renovation, Maprime Renov, which is reduced with approximately 1.9 billion euros allocated to energy renovation for 2026. And in terms of the energy savings certificates, the CEEs, this could help us too. There'll be 5.2 billion euros, that's a five-year plan, And that starts in 2026. So this is phase six of the CEE. These certificates are funded by the private sector. So all of those involved in selling and producing energy, of course. So it's more stable than the government mechanism. And as you know, the French government is seeking to achieve budget reductions. Industry, there's a new tax which will impact us substantially. The prices that we'll be able to sell at, it's called the matf which in english is the cbam the carbon border adjustment mechanism which will impact a certain number of our products and it'll total several hundreds of thousands of euros and these will be passed on of course in prices in 2026. so i don't think there should be anything directly on our margins but there will be impact on our prices So in terms of the industry segment, we remain positive in the medium term. Market shares are low enough for us to hope to get growth in terms of market share in the future. Retail, no great positivity for 2026. On the water cycle, modestly optimistic for 26. We talked about Ayla and Ceragor. We think that we'll be able to find, recover growth in those areas. Internationally, the companies we talked about earlier, present internationally, will continue to work in national industry markets, 2026, 2027. and in 2026, 2027, we'll be looking to maybe add a new subsidiary in the area of water cycle, the water cycle industry internationally. The price impact, we believe that's gonna be between one and 2% in 2026, but we will report on that quarter by quarter. There's a question that's been asked on the chat concerning people, our feelings about the beginning of the beginning of 2026. I say that we are reasonably optimistic, which corresponds to the budgets that's been put together by the subsidiary CEOs. Except the retail sector, which we assume is going to continue to be difficult. And the second question comes recruitment. I don't think we're going to be recruiting massively in 2026. I don't think that our subsidiaries will be in this state of mind but we'll certainly be reinforcing our IT teams simply because we believe that if we keep our staff levels as they were in the past that means that we'll be able to react more quickly when the recovery of the markets comes. So, some market elements for new housing in France. We see that the blue curve on this chart shows building permits granted, but we see a slight improvement in housing starts, which is the orange line. So it looks as if we've come out of the worst of that, the bottom, that obviously situation has bottomed out and the curve is looking more positive now. COIDIS Next gives us information from the distributors of sanitation, heating and equipment, so professional activity. A good month of December at plus 5.1%, but then bad news again in January. So it's around about zero, but it seems to fluctuate between positive and negative results. Inua represents the retail market, the DIY market. And there you see that we're slightly negative at 0.2%. 0.4% and rather negative outlook for the year ahead. In terms of industry, we look at this PMI index in France and in Europe. It's all pretty close to 50, which means that the market is 50. We are not in markets like aviation or arms But we do have opportunities in data centres, for example, which... But there won't be major beneficial impacts for Thermodigroup. But the market shares we have do suggest that we can grow in the future. I'll look into our growth targets. So this concerns just turnover. I would ask you to read pages 10 and 11 of the URD. which give the 10-year objective and our strategy to achieve those objectives. And you see in terms of our current turnover, we're behind, but we can still make acquisitions in the future, which will help us to get closer to the top of that blue line. And we're also expecting a slight increase in prices, a slight inflationary effect, which will of course increase the turnover as well. Looking at our capital now, the overall number of shareholders has increased. That's great for us to see that the number of shareholders increase. It's also great to see that private shareholders are still present with a distribution between private and institutional investors which is more or less the same. 9,817 private shareholders. and institutional investors, which are private investors. And the highest, the biggest shareholder of the group with 9% is a German guy who has moved out of the institutional side and into the private investor side. Amongst the institutional investors, you see Fidelity, which was present last year, has increased its share to 7.6%. and Credit Mutuel Equity, which is stable at 6.9% of capital, and the pleasure to see Amundi going above the 2% holding level. You see that the number of direct or shareholders, or those holding shares through the FCP Thurman Group Trust Fund, represents 6.9%, which is a record. It's an increase, an increase, and that it's a long-term objective to increase employee shareholding. So share liquidity has increased. That's satisfactory. As you see on 1.91 to 2.12. For you, it probably doesn't look enough, but over the long term, it's a progression, and that's a good thing. In terms of resolutions now, the dividend which is going up a little. We've never decreased dividend and we want to keep up that promise. It's reasonable distribution. 43% of the profit distributed to our shareholders. We have decided in the board to separate the roles of Chief Executive Osset and Chairman, primarily because of best practices which the proxy advisors are backing. You know them very well. We're expecting greater, a high level of acceptance of our resolutions. That was the first the first reason that we decided on that. The second was to free up our executives for more operational work in the four years ahead. There's a question that's come on the chat. Why would we choose Olivier de la Clerge as the new chairman of the group? So we put a number of scenarios on the table to know whether we kept the same person with two different mandates or two separate roles, two separate people for the two roles. So we decided to separate those roles. So that meant we needed to find somebody. And we had that person within the board and that person was a candidate. and a member of, among the independent board members and he was perfect for the job we thought because he knows Thermador Group so well because he's been a board member for so long as you know he works for a distribution company and that's a listed company so a lot of advantages in terms of his profile And more importantly, we get on very well with him. And I think that'll be a great pairing between him and me, because we do get on so well. And that will help Thermidor Group for the next four years. But that's a few explanations, but you can of course ask him the question. Two new candidatures. Two renewals. So that's Bertrand Chevalier as employee director. and the shareholder of the group, and has already been with us for four years on the board, and he wants to continue for another four years. Myself, I'm standing forward for a new mandate of four years. That's 16 years that I've been a board member in Thermador Group. And if you decide to entrust me with your confidence, I will be a candidate for the role of CEO of the group. And that will be decided on the board at the meeting, which will be held the day after the AGM. Two candidates for new mandates. Claire Sidot, who would be an employee director. representing as a shareholder, replacing Marion Granger, who is stepping down, and Jean-Philippe Paul, CEO of FG Inux, who will be there to bring us some knowledge from the field. We want to keep people CEOs from the subsidiaries so that we have a good understanding of what's going on in the field. So Jean-Philippe will be accompanied by Laure Empereur, and she will take his place next year, so they will alternate. So the AGM will be on the 7th of April at 5pm on EM Lyon campus. A look at the share price. So there's just one more resolution was an amendment to the company's bylaws. You talked about the notion of representatives of shareholder employees. So we have to modify our bylaws to be able to appoint these candidates. and they're from the FCPE fund and we have completed that with an election process for our shareholder employees who are direct owners of shares in the company. So we have a second resolution concerning the change of the company's bylaws. where we have to ask for this, we're asking for this resolution to be rejected because we're expecting to go over the 1,000 employee level in the next two years and that will mean we will have to have a second employee shareholder on the board. So those are the changes to the bylaws. So a quick look at the share price and dividends. And then a look at the return on our share over a long period from 2016 to 2025. This was before the dip last year and the day before yesterday. But structurally, over the period, we've got the same level, slightly higher level than the CAC 40 on the return on our share. So I'm going to now look at the questions that are coming in. I've answered the first three. Edward asks us if we can still improve our working capital requirement in 2026. Possibly, yeah, we might be able to. Stock is mostly where we can act. We still have some improvements that we can make. But you have to be careful because when you have low rotation stocks, it takes a lot of time to work on those. And I think we've done most of the work on managing our stocks. And in our letter to shareholders, we talk about a percentage of working capital as a proportion of turnover. We've gone down below 40%. So the normative working capital requirement, WCR, sorry, will be 35%, so we're at 40%. And that will be applied to slightly different activities. But we haven't got that major change. There's no major change to our sources of supplies. So there's... There's about one-third from Europe, two-thirds from China, the suppliers. And it's only really the managing our stock level, as Guillaume was saying, that could affect the working capital requirement. We've been working with some of the subsidiaries on customer payables, and we've found improvements. But we don't expect any major change to that figure. So that 35% mark is achievable. But the second question, what is the impact of Ukrainian and Iranian problems on the group's deliveries? maybe will have impact in terms of delivery times because there are there's traffic jams in the circuit in the system so containers were going all the way around Africa to get to Europe and to avoid the problems with the first Ukrainian war. But in general terms, I could imagine there'll be some unsettlement in the supply chain. In terms of cost, I think we've done some good work. In terms of costs, yeah, that's what we mentioned when we made the call for tenders last year. We decided to co-contract with three transporters and we've renewed this cover tenders for 2026 and we're going to choose two from those three so we're going to maintain our costs control our costs basically but we have to be fair we have to have good foresight in order to be able to manage our fixed costs I think we have to pilot that question very clearly. But we've got well-negotiated costs for containers, and that's 30% of our purchases. Thierry asks if there is a company which is similar in Europe with which Thermador might be able to merge. I don't think so. certainly there are there are companies which may be similar to our subsidiaries which might be able to come and join us but certainly no group like ours Okay, so this question is, in 2026, are you noting any gains in purchasing prices from your Chinese or Indian suppliers who may be having difficulty in selling their products to the US because of the tariffs? But no, the answer is no, not really. The price of oil is increasing. plastic of course that we purchase a lot of polyethylene so the price of oil is going to affect that so that's going to lead to increases in prices but certainly what you mentioned there was more true in 2025 than in 2026. A question from Jean-Francois a word about the weather conditions in January and February in France. How does this weather impacted Thermador's business? So we had a few cold days which helped us When it's cold, of course, we use heating units, maybe heat bulbs, for example. That helps us a little bit. But we didn't have a sufficient period of freezing temperatures, which meant it would have a substantial impact on equipment in the home which might need to be replaced. So not a great impact. There is one exception, is with all the floods that happened, we were able to sell a larger number of generators for pumping water and for providing electricity to these houses that were flooded. And so also in those flooded areas we have seen an increase in sales of pumps, for example, to pump water out of flooded areas. And that can help MECAFER, for example, with their generators. And Jean-François says he was thinking about the flooding. And yes, we'll give you more detailed information at the end of the first quarter. So there's MECAFER and DEMAG, sorry. I should apologize to our friends in Vierzon. We had a two or three day period where it was difficult delivering product because of the floods, but we managed to control that. So are there anybody else in French or in English who wants to ask us a question? So the URD is online, as we mentioned, in French. It takes a bit longer in English. It's true that with automatic translation that everybody uses today, you can have access to the document in French and translate it quickly by artificial intelligence. So you can keep up to date, but we will be also putting this presentation online and you can of course consult us for that. Oh, and just to say that we did a letter to shareholders in Spanish. And so we have employees from Kilinox. And we started to translate things into Spanish for our Spanish people. Any questions? Any other questions for tonight? Or are we finished for today? okay well we'll we'll close uh there ah just one uh says arlette so she's the uh ceo of opaline so opaline is our communications agency and their company for this webinar and for the creation of the urd so it's a collective work that we do with them And that keeps us busy in January. So last year, it was available on the 14th of March 2025. And we should do better this year. That's just a message from Alec. So let's have a look at questions. Okay. Okay, well, just I would like to wish you a nice evening and see you at the AGM. You could log in and follow it online if you're not in Lyon and of course you can follow the AGM online. And of course, we can speak before Patricia and I present on many investor forums. And we're very happy to set up meetings with you if you would like. So thank you to all of you and good evening.