AmRest Holdings Stock

Hello, and welcome to today's AmRest First Half 2026 Results Call. My name is Seb, and I'll be the operator for your call today. [Operator Instructions] I will now hand you over to Lukasz Wachelko from Wood & Co to begin. Please go ahead when you are ready.

Good afternoon, ladies and gentlemen. My name is Lukasz Wachelko. I'm presenting Wood & Company. And I have, again, the pleasure of moderating the quarterly call with AmRest. The company is represented by CFO, Mr. Eduardo Zamarripa; and IR and Strategic Planning Director; Mr. Santiago Camarero Aguilera. With no further ado, Eduardo, the mic is yours.

Thank you, Lukasz. Good afternoon, everyone, and thank you for joining. We appreciate your time and your continued interest in AmRest. I'm Eduardo Zamarripa, and I'm joined today by Santiago Camarero, our Head of Strategy and Investor Relations.

Before we begin, I would like to frame the first half of the year in a simple way. AmRest has the scale, leading brands and a strong operation platform. Our priority is to convert those assets into higher and more predictable value per share. That means concentrating capital where returns are proven, taking corrective actions where performance is below our expectations and converting lower investment intensity into sustainable free cash flow.

The trading environment remains demanding. Consumers are cautious, restaurant traffic is under pressure in several markets and performance across our portfolio is uneven. We are not satisfied with every element of the results. However, this should not hide the progress we are making in the areas that define the group's financial capacity, cash generation, capital discipline and portfolio quality. So let's please turn to Slide 2.

AmRest is a leading listed restaurant operator in Europe and a trusted operating partner for some of the world's most reputable and iconic global brands. June 30, 2026, we operated 2,133 restaurants across 8 brands and 22 countries, supported by more than 44,000 employees and serving approximately 30 million customers every month.

Our portfolio is diversified across 4 complementary restaurant categories. Quick service restaurants represent 48% of the portfolio; coffee, 21%; fast casual, 17%; and casual dining 14%. This provides exposure to different consumer occasions, price points and channels, but scale alone is not the investment case. The strategic value lies in the operating infrastructure behind this footprint, restaurant development, supply chain, digital and delivery capabilities, brand management and local teams with deep market experience.

Our objective and effort is to utilize this platform more effectively, directing growth towards the brands and geographies where we can demonstrate attractive economic and sustainable returns. This is a large and diversified platform, but our decision framework is increasingly focused on returns rather than scale for its own sake.

Moving to Slide 3. This slide summarizes the financial performance for the first half of the year. Revenues amounted to more than EUR 1.2 billion, excluding the effect of business deconsolidation in the previous year. SCM revenue decreased by 0.7% year-over-year. EBITDA reached EUR 177.7 million, representing a margin of 14.4%. However, the most important positive development was cash generation. Operating cash flow decreased by EUR 27 million. At the same time, investing cash outflow decreased by almost EUR 31 million. Nonetheless, we have also maintained development of the portfolio with 29 openings in the first half of the year and 85 openings over the last 12 months.

Finally, the average remain at a prudent 2.5x EBITDA. The key message for me is that while the P&L reflects concentrated pressure in selected markets, cash generation and financial flexibility are moving in the right direction. This distinction matters because it demonstrates the underlying capacity of our platform.

Moving to Slide 4, please. Here, we can find the reported first half performance into context. Revenue, excluding the SCM business deconsolidated last year, declined by 0.7%. EBITDA amounted almost EUR 178 million, and the margin was 14.4% compared with 15% in the first half of 2025. However, the downside was highly concentrated. Excluding Czechia and the disposal, revenue increased by approximately 2% on the same basis, EBITDA margin increased 0.4 percentage points to EBITDA margin of 14.9%. Czechia is an important market, and we are fully focused on restoring the business. Purpose is to show the isolated effect of this market. Most of our core platforms remain healthy and continue to demonstrate their earnings capacity.

If we now go to Slide 5, please. This slide brings together 4 strategic developments that support our investment thesis. First, free cash flow evolution is moving into the right direction, supported by both the stronger operating cash flow and less intensive investment effort. Second, we continue to apply a more selective approach to capital allocation with greater focus on execution, cash generation and investment returns. Third, shortly after the reporting period, we completed the novation amendment and extension of our syndicated financial agreement, materiality increased our financial flexibility. And fourth and the last point, we expanded our brand portfolio by announcing the launch of Taco Bell in Poland. This is not grow for growth. It is our commitment for a disciplined introduction of a new leader global QSR brand in our largest market using infrastructure and capabilities that we have already in place, all these aspects, our key support, the group's future growth and our long-term value creation objectives.

Moving to Slide 6. We have information that is central to our message today because it shows the financial conversion already taken place. Free cash flow, defined as operating cash flow, excluding lease payments, less investment cash flow, improved from negative EUR 26.2 million in the first half of 2025 to positive EUR 25.6 million in the first half of 2026. This represents a year-on-year improvement of almost EUR 52 million. The improvement reflects a stronger working capital discipline, better cash conversion and disciplined capital expenditures.

Many things are moving in the right directions. Nevertheless, the direction is clear. The combination of operational cash flow discipline and lower investment intensity is translating into substantially better free cash flow. For us, this is a strategic shift. Growth will continue. Returns are attractive. Both free cash flow and value creation per euro invested are critical in our decision metric.

Moving to Slide 7, please. You can see the continued normalization of the investment intensity. CapEx as a percentage of sales declined for almost 10% to 5.3% by the end of the second quarter of 2026. At the same time, our gross opening trajectory of equity stores has remained broadly stable, while the number of renovation has moderated following the elevated post-COVID catch-up program.

This is not simply a reduction in investments, it's a transition towards better investments where we are more selective in new developments, prioritizing projects with the strongest risk-adjusted returns and using portfolio optimization as an active capital allocation tool.

Moving to Slide 8. Following the reporting period, we strengthened the group's financial profile of the group through the novation of our syndicated financial agreement. The new agreement increases the revolving credit facility up to EUR 100 million, changes repayments from quarterly to semiannual and introduces a 2-year grace period. It extends final maturity to June 2031, with 2 optional 1-year extension, subject to lenders' approval and reduces the applicable interest margin. It also means selected financial covenants and provides the possibility to establish additional accordion facility.

The agreement is supported by 8 bank partners across 5 countries. It provides a longer and more efficient maturity profile, lower funding costs and greater liquidity headwinds. This additional flexibility should not be interpreted as a change in our financial discipline. It's value that gives us the capacity to manage volatility, execute portfolio actions and finance selective opportunities without compromising a prudent leverage profile.

If we go to Slide 9. Here, we show how the portfolio has evolved and how we think about short-term future growth. At the end of June, AmRest operated 2,133 restaurants consisting of 1,891 equity restaurants and 242 franchise restaurants. Over recent years, we have combined organic development with strategic adjustments, including divestments in Pizza Hut Russia, Pizza Hut Germany, Pizza Hut France, the sale of KFC Russia and other businesses with no restaurant count [indiscernible], but no less important from the strategic perspective. This action demonstrates that the perimeter is not static.

We have been taking significant strategic decisions. By actively reshaping the portfolio, we are creating the capacity to introduce new fresh attractive businesses with a stronger growth potential and compelling long-term economics. We will grow where returns are attractive, renew restaurants where investment supports customers' experience and cash generation and optimize our exit activities where long-term value creation is needed.

The planned launch of Taco Bell Poland, fits this framework. The first restaurants are expected to open in the fourth quarter of 2006. Poland is our largest market, and we can leverage existing development, supply chain, digital, delivery and operating capabilities. Our approach is control initial exposure, close monitor of unit economics and expansion based on proven returns. This gives us meaningful upside potential while maintaining capital discipline.

With this, let's jump to Slide 10, and let me share with you some of the commercial flavors from our brands. In a cautious consumer environment, our brands stay relevant through a balanced mix of innovation, value and consumer engagement. At KFC, we combine product innovation with clear value. Double Down return as a distinctive chicken-led platform, while the new [ protein ] shake expanded the brand into new consumption occasions. At the same time, offers such as All in Box, Tuesday Bucket and selected 50% promotion supported affordability and traffic across the market.

At La Tagliatella, we reinforced its premium positioning through an exclusive collaboration with Michelin-starred chef, Pepe Rodriguez. The partnership brought together the brand's Italian heritage and contemporary culinary activity, helping refresh the proposition and strengthening customer interest.

At Starbucks, the brand delivered strong results from its spring and summer beverage platforms. Protein Latte launched in April added close to 3 percentage points to the beverage sales mix with no visible cannibalization of existing promotional activity. The Starbucks Rewards also continued to build momentum, reaching more than 15% of transactions. Together, these results show the value of relevant innovation supported by a stronger loyalty engagement.

Moving to Slide 11. The same formula of innovation, value and local relevance supported progress across the rest of the portfolio. Sushi Shop show a clear improvement in second quarter, led by France and supported by a stronger execution across most European markets. The Adrien Cachot collaboration became the brand's best-performing chef partnership to date. Switzerland and Luxembourg markets remained strong, while Spain and Belgium improved sequentially.

At Blue Frog, we launched Flavors of China, combining regional Chinese inspiration with the brand's Western casual dining identity. The platform strengthened local relevance and gave customers fresh reason to engage with the brand.

In Pizza Hut, we focused on 2 clear customer needs, value and excitement, with boxes offered an accessible complete meal with the K-WAVE menu using Korean-inspired flavors to encourage trial. Both initiatives were brought together under the #FeedGoodTimes, reinforcing Pizza Hut as a brand that combines good food, convenience and shared occasions.

And finally, at Burger King, we continue to sharpen its value proposition together with attractive collaboration as it has been successful premier of The Mandalorian.

With this, Santi, if you can cover the financial main highlights, please.

Thank you, Eduardo, and good afternoon, everyone. Before moving into the detailed financial section, let me place the second quarter results in the broader strategic context. The quarter does not present a uniform picture. At the group level, revenue was really stable. But the headlight results combines resilient performance across most of the portfolio with significant pressure concentrated in a limited number of markets. This distinction is important, not for looking our way from the areas requiring improvement, but to understand where earnings capacity remains intact and where decisive actions are needed.

In this environment, our priority is not to pursue volumes [ than ] cost, it is to recover profitability, profitable traffic, hotel/restaurant level economics and to ensure that every euro of capital supports sustainable returns. The quarter should therefore be read through 3 lenses: the first one, the quality of the underlying portfolio; second, the corrective actions in underperforming markets; and finally, the stronger conversion of earnings into cash.

At the same time, it's important that we remain realistic. Same-store sales were below last year. Consumer demand remains cautious and weaker traffic reduced operating leverage in selected markets. Restoring that operating leverage is the key management priority that we have.

So let's now move to the Slide 13 with the financial highlights of the quarter, please. Here, you can see that sales were stable and the portfolio development continued, while profitability reflected weaker operating leverage. At the same time, capital deployment was materially lower. With this backdrop, sales reached almost EUR 642 million, broadly fat -- sorry, flat compared with the second quarter of 2025, while the same-store sales index was 98.

EBITDA amounted to EUR 101 million, and the non-IFRS EBITDA was EUR 50.6 million. The operative profit reached about EUR 22 million, representing a margin of 3.5%, and net profit was almost EUR 4 million.

We opened 17 restaurants during the quarter, including 13 equity restaurants and 4 franchise units.

CapEx was EUR 24 million compared with almost EUR 39 million in the same period of last year.

Moving to the Page 14. We find the recent trajectory of revenue and same-store sales. Revenue increased sequentially from EUR 589 million in Q1 to EUR 642 million in Q2. This is supported by the normal seasonality of our business. However, on a year-on-year basis, sales were broadly flat.

The same-store sales index improved from 96 in the first quarter to 98 in the second quarter. This sequential movement is encouraging, but we should remain cautious. Comparable sales were still below last year and the recovery was uneven across different markets. Therefore, the appropriate conclusion is not that the challenges have disappeared, but the group sales stabilized during the quarter and the gap versus last year narrowed.

If we go to the Slide 15, please. This page summarizes the evolution of EBITDA and EBIT and how margins progress into the second Q. EBITDA decreased from EUR 107.7 million in Q2 2025 to almost EUR 101 million in Q2 2026, and the EBITDA margin declined from 16.8% to 15.7%.

The operating profit amounted EUR 22 million compared with EUR 34 million last year, and the margin was 3.5%. The main driver of this decrease in profitability was lower operating leverage in markets affected by weaker sales and transaction volumes, particularly Czechia, Romania and Germany. These effects were partially offset by a strong performance in Hungary and also by improving profitability in France. In this situation, our operational priority is to recover traffic while improving labor productivity and maintaining rigorous control on every semi-variable cost line.

In this regard, we bring you in the Slide 16, how to translate the margin movement into its principal components. The starting point is Q2 2025 EBITDA margin. Food and merchandise costs were almost flat year-on-year. However, the pressure was concentrated in payroll and social security cost, together with pressure from occupancy, depreciation and other operating expenses.

General and administrative cost remain disciplined that, together with other operating items, partially mitigated the decline.

Moving to the Slide 17. These tables puts the income statement and the cash flow side by side. Revenue was broadly flat while EBITDA decline reflecting the operating leverage dynamics that we have just discussed. On the other side, cash performance was considerably more constructive. Net cash from operating activities increased by EUR 17.5 million and investing cash outflows decreased by EUR 15 million.

Finally, the net equity restaurant count increased by 31 units over the last 12 months, showing that the groups continue to develop whilst reducing investment intensity.

Moving to Slide 18, we find the debt and liquidity evolution. First, the balance sheet remains prudent and with a high liquidity buffer. At the end of June, net financial debt was EUR 505 million compared with EUR 518 million at the end of 2025. On the other hand, liquidity reached to EUR 162 million and all available credit lines amounted almost EUR 91 million. The leverage ratio was 2.5x, which remains consistent with a prudent financial profile.

This position, combined with the financing innovation explained earlier, give us additional capacity to absorb volatility and execute selective portfolio decisions. The objective is not to use flexibility indiscriminately, but to preserve optionality while maintaining financial discipline.

Going into the Slide 19, we can find the breakdown of revenue, EBITDA and the number of restaurants that we have in each geography. These segments comprise businesses in 22 countries where, once again, we have observed very different commercial dynamics.

Turning to the Slide 20 and 21, we present the key metrics for Central and Eastern Europe, our largest segment. CEE remained the group's largest region, representing more than 63% of the group sales. Revenue increased by almost 2% to EUR 407 million. EBITDA declined to EUR 76.4 million with a margin decrease by 1 percentage point to 18.8%.

The region combined strong underlying growth in selected cost markets as the case of Poland or Hungary with a material concentration of downside in Czechia and Romania. The restaurant portfolio reached 1,292 units at the end of the period following the gross opening of 20 restaurants during the first half of the year.

Moving to Slide 22 and 23, we bring you the information of our Western European business. Western Europe generated revenue of EUR 212.5 million in the quarter, down 3.2%, and generated an EBITDA of almost EUR 31 million with a margin of 14.5%. While the reported EBITDA was below the previous year, the comparison was affected by some one-off gains recorded in Q2 2025.

Again, this comparison in the region show signs of improving underlying momentum, especially in the case of France that performed slightly ahead of expectations. The improvement indicates that the operational and commercial measures implemented are gaining traction, with the recovery increasingly visible in profitability even before a full normalization of sales has been achieved.

The restaurant portfolio closed the period with 759 units following the gross opening of 8 restaurants during the first half of the year.

And finally, in Slide 24 and 25, we bring you the numbers of China. China generated quarterly revenues of EUR 22.5 million, broadly stable compared with Q2 2025. Nonetheless, despite this stability, the underlying sales environment remained challenging during the quarter. The EBITDA reached EUR 4.4 million compared with EUR 5.3 million in the last year. Consequently, the EBITDA margin declined from 22.8% to 19.8%. Nevertheless, the business continue to deliver a solid level of profitability with an EBITDA margin close to 20% despite a soft demand environment.

The results were recorded against a still challenging consumer backdrop. China's economy continued to be supported by policy easing, exports and industrial production. However, consumer demand remains subdued with retail sales growing at a considerably slower pace than headline GDP.

Finally, the number of restaurants managed by Blue Frog in the region at the end of the quarter was [ 82 ] units following the opening of 1 restaurant.

And with this, I pass the mic to Eduardo.

Thank you, Santi. Before we move to questions, let me close with our outlook for the remainder of 2026. When we presented our expectations for the year, we anticipated single-digit growth in both revenue and profitability. Based on the first half performance, the slower recovery of consumer traffic in selected markets and the continuing pressures on operating leverage, we now expect revenue and profitability growth for 2026 to be slightly positive rather than growing at a single-digit rate. This is consequence of a more cautious view of the pace of commercial recovery, particularly in the markets currently under pressure. At the same time, the view does not alter our confidence in the quality of our core platforms or the strategic actions already underway.

With that, Santi, and I are ready to take your questions.

[Operator Instructions]

While we're waiting, maybe I will use the privilege of moderator and ask a couple of questions from my end. First would be about Taco Bell, if you could shed some light how many restaurants shall we expect this year and next year? What are your goals for this project?

Well, Lukasz, this is something very relevant as we were mentioning previously, launching a new brand in one of our strongholds. We consider that is a key priority for us. And this will reinforce the portfolio that we have over there. So the idea is that before year-end, we could be opening 3 restaurants in Poland and a higher number next year. So every year, we will increase the number of openings over there. But what I can advice you is that this year, we should be having these 3 openings.

Okay. And I have a question regarding 3 markets, the first market for Czech Republic. While you have some issues with bad PR, let's call it this way, since autumn last year and it's still continued, sales were down 16% in the second quarter. Do you see that the third quarter is bringing that to an end? When should we expect problems to be overall? Well, you are already reaching the low base effect.

Thank you, Lukasz, for raising that topic. As you mentioned, in the Czech market, the situations, the sales remained under pressure, impacted, as you were saying, of this negative publicity. The customer traffic has been affected despite the execution of AmRest of a comprehensive KFC growth plan during the first half of the year. We are reinforcing the brand's operational excellence, food quality, food safety standards, leveraging digital tools, employee training and restaurant-level initiatives. Sales have not been recovered to previous levels, as you were mentioning. We are keeping [indiscernible] very important strategic initiatives and focusing on the regulatory -- on the recovery of the market. So we expect that with the new topics that we -- and new activities that we are performing in the market, the plan would allow the recovery of the customer traffic and sales. Timing, difficult to tell, Lukasz.

And what about Romania? We are seeing from all the peers of yours that the market is slowing down. How do you see the dynamics within this market?

This is a challenging one, Lukasz. As you said, we are suffering in that market, but that's something that is happening to some other peers. So hopefully, everything is a cycle. So we expect that this cycle ends soon, and we can go back to the [ price ] recovery as soon as possible.

And the last [indiscernible] food prices. Do you see under pressure on the food prices in the region or are seeing deflation? How does the food costs look from your perspective?

So in this sense, I mean, you have seen that in the latest quarter, we have been benefiting by some easing in terms of the cost pressure. But it's true that although it's still not reflected in our books, no expectations for next year if the conflict in the Middle East continue, is going to be -- is going to put some pressure. So what I can tell you is that it's still is not something that is affecting us. And in the short term, we don't expect any affectations due to the long-term purchases that we have for the year.

Okay. Do we have any questions from the room? I don't want to monopolize the call.

[Operator Instructions] Currently, you have no questions waiting on the line.

So if we don't have further questions, thank you very much for your participation in the conference call. And hopefully, we see you soon in one of our restaurants in Europe. Thank you very much, and have a good weekend.

This concludes today's conference call. Thanks, everyone, very much for joining. We hope you enjoy the rest of your day.

Hello, everyone, and thank you for joining the AmRest First Quarter 2026 Results Call. My name is Lucy, and I'll be coordinating your call today. [Operator Instructions]

It is now my pleasure to hand over to your host, Lukasz Wachelko from Wood & Co. to begin. Please go ahead.

Good afternoon, ladies and gentlemen. My name is Lukasz Wachelko, and I am representing Wood & Company. I have again the pleasure of moderating the call with AmRest after they reported the results. The company is being represented by CFO, Mr. Eduardo Zamarripa; and IR Managing Director, Mr. Santiago Camarero Aguilera.

Gentlemen, the mic is yours.

Thank you, Lukasz. Good afternoon, and thank you for joining us. We appreciate your time and continued interest in AmRest. I'm delighted to be with you today. Joining me is our Head of Strategy and IR, Santiago Camarero. Today's call objective will be to share with you how our business has performed during the first months of the year. The first quarter was marked by a more challenging macro environment, but also by continued progress in cash generation, disciplined capital allocation and resilience across our diversified portfolio.

In Europe, the year started with modest but still positive underlying momentum, gradually improving financing conditions and a relatively resilient labor market provided some support early on. However, the environment became more volatile as the quarter progressed, with geopolitical risks rising sharply following the outbreak of the war in Iran. As a result, the quarter ended on a weaker note with inflation accelerating sharply in March, driving largely by energy and with a sharp deterioration in consumer sentiment. On top of that, we also saw the impact of short-term factors, particularly weather. On trading patterns in several of our markets, as you will see in the results we are about to discuss.

With that, let's turn to the materials we'd like to share with you today. If we move to Slide 2, please. AmRest is one of the leading listed restaurant operators in Europe, operating and master franchising some of the world's most iconic global brands. As of the end of March 2026, we operated 2,129 restaurants across 8 brands and 22 countries, serving around 30 million customers per month with a workforce of over 40,000 employees.

Our portfolio is well diversified by concept. Quick service restaurants represent roughly half of the portfolio. Fast casual, casual dining and coffee provide balance and exposure to different consumption occasions. Geographically, our footprint spans Europe, China and selected Middle Eastern markets, giving us resilience across cycles and consumer trends.

Moving to Slide 3. Let me remark the most relevant milestones for this first quarter of 2026 that I would try to summarize in 5 parts. Number one, in first quarter, revenues reached EUR 589 million, a 1.5% decline year-over-year on a constant basis that excludes the S.C.A. subsidiary disposal executed last year.

Number two, EBITDA amounted almost EUR 77 million, representing a 13% margin, while profitability was impacted by sales leverage, we continue to protect margins through our cost discipline and operational focus.

Three, importantly, free cash flow improved with net cash from operations increasing by EUR 9.5 million and investing cash flow decreasing by EUR 15.6 million, reflecting higher CapEx control.

Fourth, with this, our leverage remains healthy level at 2.6x.

Five, and additionally, we opened 12 new restaurants during the quarter with 89 gross openings over the last 12 months.

If we go to Slide 4, we remain fully committed to delivering compelling products and experiences to our consumers. Across brands, first quarter saw a diverse mix of innovation-led launches, refreshed menus and stronger beverage offerings. These initiatives are designed not only to drive traffic, but also to reinforce brand relevance and value perception.

Let me start with commercial positions of KFC, La Tagliatella and Starbucks brand in Slide 4. At KFC, we energized first quarter with a balanced blend of innovative campaigns and emotionally resonant activations, delivering locally relevant experience and value propositions across all markets. Our approach focused on driving traffic, affordability and brand relevance for our customers. Key initiatives such as Cheesy Cheddar, Pocket for One and the Mafia IRL Menu drove excitement and encourage guests to explore indulgent flavors, solo dining and new experiences. Meanwhile, value platforms like [ WizMart ] and Tuesday Bucket Sustain Everyday Affordability and frequent visitors.

At La Tagliatella, we continue to strengthen our commitment to innovation and to bringing La Italianita to our life, of our guests with the launch of our new 2026 menu. This latest menu reflects our refreshed visual identity, now progressingly rolled out across an increasing number of restaurants and introduces a range of key product innovations, including the pancetta and gorgonzola pizza and the Saboreimar sauce. In addition, the new menu of signature dishes created in collaboration with Michelin star chefs further elevating the brand's culinary proposition.

For this launch, La Tagliatella once again reaffirms its commitment to delivering an exceptional guest experience, while continuously offering new distinctive and differentiated propositions. At Starbucks, limited time beverage offerings continue to gain traction with the beverage LTO mix rising. Consumer preference are shifting towards cold beverage throughout the year as evidenced by iced coffee mixing to 13% from 11% last year, signaling a structural change in consumption patterns. On the other hand, food sales maintained their strong momentum, supporting a higher average checks and reinforcing the appeal of our food and beverage pairing strategy.

Moving to Slide 5. At Sushi Shop, we were building a strong momentum during the second part of the quarter, fueled by the launch of Le Petit Prince limited time offer. This standout LTO quickly became the most successful in our history, surpassing all previous records. It was widespread appeal lead with over 25,000 boxes sold across all markets.

In Blue Frog, we further elevated its culinary identity and regional relevance with the launch of the Flavors of China series. This initiative features lineup of new dishes inspired by iconic regional Chinese flavors, each throwfully remaining through the Blue Frog Signature east meets western lens by blending traditional taste profiles, authentic ingredients and local culinary stories into contemporary guest-friendly formats. The Flavors of China series brought the brand regional inspiration to the name.

At Pizza Hut, the focus has been on driving traffic and relevance through the value menu innovation by launching dynamic consumer-driven campaigns across market. The well-known Pizza festival and new hot deals introduced accessible pricing and streamlined choices, boosting fast casual and food court transactions and reducing decision barriers for guests. These initiatives reinforce Pizza Hut reputation for consistency and trust, while ongoing hot deals continue to deliver incremental volume and serve as cornerstones of brand loyalty.

And finally, at Burger King, we strengthened our value proposition across the region by expanding the portfolio with more affordable offers. In Poland, Czechia and Romania, the King Deal Double campaign proved to be a strong success. During seasonality weaker quarter, the campaign was designed to drive traffic through and compelling price point with reinforcing BK's superior food credentials. Altogether, this initiative reflects our continued commitment to delivering relevant high-value propositions to our guests.

In summary, the objective is clear: allow customers to enjoy high-quality meals without stretching their budget, while maintaining brand integrity and margins.

If we go to Slide 6, during the quarter, a number of temporary external factors influenced consumer behavior, leading to more cautious and convenience-driven purchasing decisions. Adverse weather conditions, together with the escalation of Iran conflict disrupted normal trading patterns during the period, reduced mobility and higher uncertainty prompt consumers to prioritize convenience, which resulted in noticeable channel mix effects.

As a consequence, delivery gained further momentum, exceeding 20% of total group sales and reaching its highest levels in the post-COVID period as consumers increasingly flavor off-premise occasions. At the same time, the sharp rise in fuel prices in March had a direct impact on mobility patterns, which was reflected in double-digit declines in drive-thru sales.

Looking at sales channels overall, digital sales continue to advance and remain firmly established at the levels above 60% of total sales, excluding casual dining. This compares with less than 20% prior to COVID and clearly reflects a structural shift in consumers' behavior rather than a temporary trend.

Importantly, the digital sales growth is well diversified and supported across multiple touch points, including our proprietary mobile apps and self-service kiosks, web-based ordering platforms as well as aggregators and franchise source channels. Taken together, the evolution of our channel mix reinforces the strategic importance of digital capabilities as a long-term competitive advantage for the group.

Moving to Slide 7. This slide shows the progress we are making in normalizing CapEx and improving investment discipline. In these years, immediately after COVID, CapEx level were high. We had to catch up on deferred maintenance and accelerate a broader restaurant refurbishment program. That catch-up pace is now behind. And what you can see here is that CapEx is moving back towards a more normalized steady-state level.

Starting with the chart on the left, CapEx as a percentage of trailing 12-month sales continued to trend down. It was around 9% at the end of 2023 and has gradually decreased roughly 6% by first quarter of 2026, reflecting a clear reduction in investment intensity.

The chart on the right helps to explain how this is happening. Our gross opening path remains while the renovation effort is stabilizing. We are renewing the portfolio and opening a new restaurant, keeping our clients' experience at the highest standards and driving traffic up.

This improvement means better spending. We are being more selective in growth, prioritizing projects with best returns and focusing on efficiency and value creation rather than scale for scale's sake. This disciplined approach is starting to support cash generation.

Moving to Slide 8, please. At the end of first quarter, AmRest operated 2,129 restaurants. As we have explained in several occasions, underlying growth has been combined with deliberate strategic exits from nonperforming or noncore businesses, including Pizza Hut in Russia, Germany and France and disposal of KFC Russia. This reflects clearly strategy, grow where returns are attractive and exit where long-term value creation is limited.

With this, Santi, you can cover the main financial highlights, please.

Thank you, Eduardo, and good afternoon, everyone. As Eduardo has described, the first quarter of the year has been challenging from a sales perspective, affected by temporary headwinds and an uneven market performance.

However, the group demonstrated resilience. We improved cash generation. We have now a disciplined capital allocation that will pay off and a robust balance sheet. Nonetheless, we are not satisfied with the sales outcomes, and we want to be clear on our priorities, rebuilding momentum where it has been impacted, increasing profitability through operational discipline and staying laser focused on cash generation.

We have strengthened our commercial initiatives through a broad set of actions, covering new menu development and product design enhancements. The objective has not only been mitigating the temporary headwinds experienced during the period, but more importantly, to restore sales momentum in the coming quarters.

If we can move to Slide 10, please. We have here the main financial highlights of the quarter. Sales reached almost EUR 589 million on a constant perimeter basis. This is excluding revenues from business that consolidated last year. This figure represents a 1.5% decrease versus the same period of 2025 and the same-store sales index stood at 96.3. We have already discussed the temporary factors behind this performance that affected consumer sentiment and restored trading patterns in several markets.

In terms of profitability, EBITDA reached almost EUR 77 million, while EBIT stood at EUR 5.5 million. Net profit was negative in the quarter at EUR 17.3 million, largely reflecting weaker sales leverage and nonoperational factors, but also the seasonality of our business in the first quarters of the year.

And finally, CapEx totaled EUR 22 million, almost EUR 9 million below last year, in line with our optimization strategy, while we opened 12 new restaurants during the quarter.

Moving to Slide 11, please. This page summarizes the evolution of EBITDA and EBIT and how margins progressed into the first quarter of the year. During this period, as we discussed, the group generated EBITDA for EUR 77 million, which translates into an EBITDA margin of 13%. This is almost EUR 5 million below the level achieved last year or EUR 7.7 million lower on a constant perimeter basis. The key driver behind the EBITDA decline was lower volumes of sales in selected markets, which created adverse operating leverage.

While food cost showed early signs of easing in some categories, benefiting from price relief after several quarters of cumulative inflation as a result of our procurement decisions as well as positive market dynamics. However, this improvement was not sufficient to offset the lack of sales leverage. In particular, fixed and semi-fixed cost line, especially rent and labor costs were more difficult to absorb due to lower volumes, which limitated the flow-through.

EBIT was more impacted and stood at EUR 5.5 million, which represents a modest EBIT margin of almost 1 percentage point. It is also important to be transparent about where the pressure was concentrated. The effects were more pronounced in Czechia, France and Germany, affected by temporary factors, which can distort the underlying view of the quarter's operational performance.

In this sense, to provide a clear picture of this underlying performance, excluding the Czechia business, the picture looks much more encouraging. Revenues increased by 1.4% year-on-year and EBITDA rose by almost double-digit figures, 8.5%, lifting the EBITDA margin to 13.5%, up 0.3 percentage points versus the previous year.

So the key takeaways from this slide are for [indiscernible] resilience. Even in a quarter with mixed sales dynamics affected by higher seasonality effect that in other occasions, EBITDA margin remains broadly stable at around 13%, while we are focused on restoring sales momentum and gradually rebuilding operating leverage as conditions normalize.

Moving to the Slide 12, please. So while profitability was pressured, cash generation improved strongly. Net cash from operating activities increased by almost EUR 10 million year-on-year to EUR 62.6 million, which represents nearly 18% improvement versus last year. This improvement was supported by tighter cash discipline and working capital movements, showing that even in a challenging trading environment, we can protect liquidity and continue to generate cash.

Second, we continue to reinforce our focus on capital efficiency. Investing cash outflows decreased by almost EUR 16 million to EUR 32 million, reflecting lower cash absorption in CapEx compared with the prior year period. This is fully consistent with our objective of delivering stronger free cash flow generation through 2026 as investment intensity normalizes and we prioritize returns.

Finally, we are still building for the long term. Net equity restaurant count increased by 35 units over the last 12 months, which supports sustainable growth while we remain disciplined on where and how we deploy capital. So the takeaway from this slide for me is a balanced one. Q1 profitability was pressured, but we delivered a clear improvement in cash generation and kept a tight grip on investment, strengthening the foundation for the rest of the year.

If we go to Slide 13, please. Here, you can find a detailed view of our liquidity and leverage position. Our overall risk profile remains broadly unchanged with a net financial debt now at EUR 547 million and with a leverage of 2.6x, what we consider to be a healthy level. At the end of the quarter, we held nearly EUR 117 million in cash and had access to an additional EUR 119 million in committed credit lines. All this ensures that our liquidity position remains prudent and efficient, fully aligned with the group's operational and strategic needs.

Going into the Slide 14, please. We can find the breakdown of revenue, EBITDA and the number of restaurants that we have on each geography. These segments comprise businesses in 22 countries where once again, we have observed very different commercial dynamics. CEE remains the largest contributor to sales, EBITDA and units, followed by Western Europe, with China representing a smaller but strategic footprint.

So turning to Slide 15 and 16, please. We present here the key metrics for Central and Eastern Europe, our largest segment. Revenues in the CEE segment reached EUR 365 million, representing a 0.4% year-on-year decline and 62% of our group sales. Remark the good performance achieved in Hungary and Balkan countries with double-digit growth. Despite the uneven revenue backdrop, the segment generated EBITDA of EUR 59 million, implying an EBITDA margin of over 16% and confirming the profitability across CEE remained broadly resilient overall.

Hungary posted the strongest profitability with an EBITDA margin of more than 19%, while Poland also delivered a very robust 18% margin. The Romanian markets produced broadly comparable levels of profitability except Czechia. From a footprint perspective, AmRest ended the quarter with 1,283 restaurants in CEE, following the opening of 8 new restaurants during the period.

Moving to Slides 17 and 18, we have the information about our Western European business. Revenues in the Western European segment amounted to EUR 204 million in the period, representing a 2.5% decline year-on-year. EBITDA reached almost EUR 25 million, implying an EBITDA margin of 12.2% Performance remained highly uneven across the main markets. France again posted a steep double-digit decline in sales, reflecting a more challenging trading environment and a weaker consumer confidence, while other large markets were more resilient. Spain delivered broadly flat sales year-on-year, while Germany recorded 2.3% growth, supported by continued momentum in the market.

Profitability in the region also continued to be very heterogeneous, driven by different sales trajectories and cost structures. Spain remains the clear profitability anchor, sustaining an EBITDA margin above 20% threshold, while Germany's margin stayed at the low end at 4.3%, underscoring the lack of operating leverage and a more pressured cost base in that market. In terms of restaurants at the end of the quarter, AmRest maintained 762 restaurants in the region after opening 4 units.

And finally, we go to the Slide 19 and 20, we have our numbers for China. Revenues in China amounted EUR 19 million in the first quarter, representing more than 12% year-on-year decline. Here, the depreciation of the Chinese yuan against the euro was a key headwind. And in constant euros, sales decreased by 7.5%. From a macro perspective, the operating backdrop in China was not recessionary, but it remains imbalanced and still cautious on consumption, which is consistent with a softer demand environment for discretionary spending as the quarter progressed. Despite the softer top line, EBITDA reached EUR 3.1 million, delivering a solid EBITDA margin of over 16%, which indicates continued cost discipline and resilient operating execution in the segment. The number of restaurants in the country at the end of the quarter was 84.

And with this Eduardo, I believe that we are ready to take questions from the audience. Many thanks.

[Operator Instructions]

Maybe taking this moment using my moderator's position, I was -- the question or questions related to the Czech market. It's been weak for you in the fourth quarter of last year. There were some negative PR on the quality of food and quality of your restaurants. And I remember a quarter ago, you were playing that down that no issues in fact [indiscernible] discovered by your internal audit. So can you tell us what's exactly happening? What are you doing to improve the situation? And when do you expect the business in Czech Republic will be back to the previous sales levels?

Thank you for the question, Lukasz. We're addressing the sales situation in Czechia with urgency and focus, seeing a positive response from our consumers. We have implemented a comprehensive recovery plan, starting with core operational fundamentals based on recertification programs to maintain continued highest standards.

Our immediate priority is to strengthen the brand's relevance with the Czech consumers. To inform our approach, we have conducted extensive consumer research to better understand current perception and trends within the QS market. Based on these insights, we have developed a very targeted marketing plan centered on limited time offers, value-driven campaigns and improved accessibility of our core products.

A recent example is the [indiscernible] campaign, featuring a locally developed fried cheese offering created by our Czech team, which has resonated well with consumers. In parallel, we continue to build brand affinity through community engagement, including our long-standing support of the Czech University Hockey League.

We are really encouraged with the initial results of these initiatives. Weekly sales volumes are showing an upward trend and consumer sentiment towards the brand is improving. We are optimistic about the trajectory and remain committed to executing our plan to drive sustained recovery in the coming months.

Okay. So can you tell us when exactly should we expect the Czech issue will be back under control? Should we expect this to happen already in the second quarter or we should wait until the summer? What's your view on that?

As I said, Lukasz, we are really encouraged with the initial results of all the initiatives that we are putting in place. And right now, we are showing a positive upward trend. So the sentiment continues towards the brand is improving. So all these are encouraging that.

And exactly when have you started to apply those measures?

We have been working on that.

What was the performance month-by-month, so how the implementation was really impacting the numbers?

I would say, Lukasz, I think that's very detailed information. Really what is important here is the trend. And we have a very positive trend, and we are optimistic about that.

So can you share with us the like-for-like for Czech Republic for the first quarter and where the same-store sales are shaping up now in the second quarter? Would it be possible to just take it out of the whole like-for-like?

I believe, Lukasz, what is important here is that the trend is improving, and that's what we are positive on, and we are working on that, and we are taking that very seriously. The full context, I think, gives a better picture of what is happening.

I don't remember from the top of my head right now, any opening in the Czech market during this first quarter of the year, Lukasz, but basically, same-store sales is going to be very similar to the figures that we already have. So there is nothing high over there.

Okay. And can you tell us where is like-for-like coming now -- in the April and May? [indiscernible] 20% decline in the fourth quarter.

Lukasz, we are talking here about the first Q figures. We don't have over here the figures for April and May, of course, on due time, we will disclose these figures, discuss everything there. But I think now that the message of Eduardo is clear. We are working on the situation. We are seeing results from the actions that we are taking. And this is what we can tell you at the moment.

Okay. And after a couple of months of these issues being visible in Czech Republic, can you share with us what's your view -- what has actually happened in Czechia? What's the issue? Is just pure PR or there were some issues also on your end? What happened?

I mean I think that on the previous quarter, we make a very clear disclosure referring to the social media news. And basically, I mean, it's public information, our assessment of what it has been the situation there. What we're bringing you today is what are the actions and the works that we are doing in order to restore the situation.

And it is visible, and we have provided you with a detailed information of what it has been the impact on this market. Also what is the situation in the rest of the markets with the different dynamics. And I think that the key message over here is that we are focused, we are working on, and we are seeing a positive results from the works that we are undertaking at the moment.

Okay. Great. Operator, maybe I will leave the floor to others to ask the questions to monopolize the whole call.

[Operator Instructions] We have no questions at this time. So I'd like to hand back to Eduardo for closing remarks.

Thank you very much for joining the conference call of the first quarter. Hope to see you soon in one of our restaurants and in the release of the results of the second quarter. Thank you very much, and have a great weekend.

Thank you very much.

Thank you.

This concludes today's call. We thank you all for joining. You may now disconnect your lines.

Hello, everybody, and welcome to the AmRest FY 2025 Results. My name is Elliot, and I'll be coordinating your call today. [Operator Instructions] I'd now like to hand over to Lukasz Wachelko with WOOD & Company. Please go ahead.

Good afternoon, ladies and gentlemen. My name is Lukasz Wachelko. I'm representing WOOD & Company. And I have, again, the pleasure to moderate the call of AmRest after the quarterly results. The company is being represented by CEO, Mr. Luis Jimenez; CFO, Mr. Eduardo Zamarripa; and Chief of IR, Mr. Santiago Camarero Aguilera. Without further ado, guys, the mic is yours.

Good afternoon, and thank you for joining us. We appreciate your time and continued interest in AmRest. I'm Luis Jimenez, CEO of AmRest, and I'm delighted to be with you today. Joining me are our CFO, Eduardo Zamarripa; and our Head of Strategy and IR, Santiago Camarero. Today's call has 2 clear objectives. First, we want to give you a transparent view of the work delivered over the last 12 months, how we have executed and what we have strengthened and what we have learned. Second, we will share our perspective on 2026, our expectations, the main opportunities we see to accelerate performance and obviously, the challenges we are navigating in a dynamic environment.

At the heart of our message is confidence in the fundamentals we are building. We believe we are laying the foundations for a compelling value creation story, maintaining disciplined profitable organic growth across the portfolio and improving consistency and execution, so discipline and the financial approach. With that, let's turn to the materials. Let's move on what we would like to share with you today. Let's move to Slide 2, please. AmRest is a truly pan-European company with a broad and diversified footprint across 22 countries in Europe, China and the Middle East. With 2,139 restaurants and a portfolio of 8 brands spanning quick service, fast casual, casual dining and coffee, we serve more than 30 million customers every month across multiple locations and channels with offerings tailored to local preferences. Our scale is a clear competitive advantage.

It allows us to replicate best practices across markets drive efficiencies and continuously enhance the guest experience while focusing our resources where demand is the strongest. And what truly powers that scale is our local expertise, more than 44,000 colleagues who understand their markets and execute with discipline every day. Taken together, this combination of geographic reach, brand breadth and operational know-how underpins our ability to identify and capture attractive growth opportunities. Moving to Slide 3. Let me remark the most relevant milestones for 2025 that I would like to try to summarize in 7 points. On a like-for-like basis, the group revenues increased by 2.4% year-on-year, reaching almost EUR 2.6 billion. The group's EBITDA generation during 2025 reached EUR 407 million, representing an EBITDA margin of 15.9% with a clear divergence in the performance across countries.

Third, despite a challenging operating environment throughout the year, particularly in the fourth quarter, the profit of the company increased to EUR 18 million compared to EUR 13.5 million last year, supported by lower impairments and interest charges. In addition, the company made a dividend payment in the amount of EUR 15 million or a 7% share, which was paid on the 22nd of December '25. In terms of new openings, during the year, we opened 92 units, and we also renovated 213 restaurants. From a leverage perspective, the group remains prudent with leverage at 2.3x at the year-end within our internal target range. And finally, during 2025, we also advanced our strategic road map throughout a meaningful step in our operating model with the disposal of our 51% stake in SCM and the termination of our mutual commercial agreements and obligations.

This milestone supports our ambition to strengthen value creation through a more integrated and efficient platform, enabling AmRest to conduct supply chain management and product quality assurance services internally going forward and identified additional synergies that can support future growth, opening up a significant avenue for value creation throughout the supplies of our more than 2,000 restaurants. With this context, I invite you in the Slide 4 to review the performance in 2025 versus the expectations that we shared with you 1 year ago. First, revenues grew in the low single-digit range despite an operating environment marked by moderate growth in Europe and declining inflation alongside elevated trade policy and geopolitical uncertainty, which continue to weigh on consumers' confidence while easing inflation supported a gradual improvement in financing conditions. Household purchasing decisions remain cautious in several markets.

Second, on profitability, we experienced a decline of 0.8% points in our EBITDA margin, affected by the deconsolidation of the SCM business, temporary business affection in the Czech market during the latest month of the year and to still elevated operating cost pressures. most notably labor costs in certain markets, while absolute food prices remain also elevated despite lower inflation rates. With respect to CapEx, we significantly reduced our capital intensity, fully consistent with our guidance. CapEx stood at EUR 158 million in the year compared to EUR 194 million in 2024, while we have maintained the number of new equity stores opened. The total number of openings reached 92 restaurants in 2025 versus 109 in 2024. And finally, as I already mentioned, the leverage continues at the low end of our internal target range.

Moving to Slide 5. Let's now focus on what we expect for 2026. From a sales perspective, we are facing a challenging start of the year. However, we expect 2026 to be a period of progressive improvement, building momentum throughout the year with a very clear second half stronger than the first. Overall, our guidance is for mid-single-digit growth. Second, as trading momentum improves, we also expect this to translate into better profitability, supported by an ongoing discipline on cost and continuous focus on operational execution. Third and very importantly, we expect a strong increase in free cash flow generation, driven by both higher operating cash generation and tighter control of investment levels, including continued CapEx optimization.

In addition, we plan to maintain a similar level of gross openings to 2025. However, the growth is expected to remain modest as we plan to accelerate our portfolio optimization, including a higher level of closures of restaurants that are not strategically aligned or are structurally underperforming so that they no longer dilute the group's profitability. And finally, we will continue to preserve a prudent risk profile, keeping leverage at the low end of our target range. If we move to Slide 6, we would like also to share with you our midterm expectations. Over the last few years, a combination of temporary factors has meant that the group's revenue growth, both at the sales line and across other income streams has not progressed at the pace we believe the business is capable of delivering. Looking ahead, we see a clear path to reaccelerate our return to a high single-digit growth profile over time.

That acceleration should, in turn, restore operating leverage and support a meaningful uplift in profitability, targeting around 2 to 3 percentage points of margin recovery versus current levels. This, combined with a disciplined investment framework that will translate into a strong increase in free cash flow generation, supported by a stronger operating cash flow and continued focus on capital allocation. Finally, our ambition is to keep strengthening our portfolio by incorporating new concepts and brands so we can address emerging customer needs, broaden occasions of use and remain highly relevant to local preferences across our markets. If we move now to Slide 7, I would like also to share with you some key strategy considerations. Digital transformation remains a key enabler of efficiency, engagement and growth across AmRest. In 2025, we continue to scale a more unified and data-driven operating model centered on 4 pillars.

AI agents supports almost all AmRest employees in central services, streaming daily operation and improving productivity in all business areas. We have also rolled out a comprehensive customer care solution, seamlessly integrated feedback from every channel and enabling efficient resolution of customers' inquiries and issues. Our digital platforms are continually refined to meet changing customer expectations, offering features like personalized kiosk offers in Central Europe or table payment capabilities at La Tagliatella. Ongoing systems standardization ensures agile and modern technology environments. And finally, we have implemented an intelligence platform that empowers daily restaurants and organizational decisions, support targeted marketing, boost customer retention, streamlines resource management and enhances pricing strategy, so enable self-service analytics for all teams.

These initiatives improve efficiency and scalability by automating central services, unifying customer interaction across channels and enabling faster and more accurate data-driven decisions, very important. In summary, these initiatives are providing a tangible improvement in the quality and speed of decision-making. So on Slide 8, we can provide some examples of how advanced analytics translate into tangible commercial outcomes, driving traffic, improving financial performance through data-driven pricing, menu simplification and smarter promotion optimization. Data-driven decisions based on advanced analytics allow us to drive traffic and improve financial performance across our portfolio.

By applying data-driven pricing tailored to local demand and competition landscape and so simplifying menus to strengthen margins and optimizing promotions based on the incremental impact, we are attracting more customers while improving the efficiency and returns of our commercial investments. Now changing topics. Let me take you to Slide 9, where we can summarize the evolution of our restaurant portfolio for your convenience. While we have already discussed our short and midterm expectations, this slide provides a clear view of the underlying openings, closures and the resulting net change.

Finally, if we move to Slide 10, our commitment to sustainability continues to be a part of our long-term value creation. And as it is stated in the headline of this slide, our sustainability agenda remains integral to how we build long-term value. In 2025, we advanced our environmental and social priorities, including a significant reduction of energy and water consumption in our restaurants by 11% and 4% comparing to last year. We also continue to embed ESG criteria into our supply chain processes, including suppliers evaluation and tender processes. Beyond metrics, our people brought up our values to life across markets as set in the fifth edition of the Foodsharing Day initiative delivered across multiple brands and countries, reflecting our continued commitment and connection to the communities where we serve. And saying this, with this, Eduardo, if you can cover the main financial highlights, please.

Thank you, Luis, for your insights. Good afternoon, everyone, and thank you for joining us. It is a pleasure to be with you again to share a summary of the results delivered by AmRest team during the last year. 2025 was marked by ongoing geopolitical uncertainty and a consumer backdrop shaped by persistent cost of living pressures. Against this backdrop, AmRest once again demonstrated the resilience of its business model, supported by disciplined execution across markets and routes. Throughout the year, we continue to adapt to a more precise conscious consumer, delivering a compelling and consistent value proportion across brands and geographies that remain central to sustaining traffic and protecting profitability.

At the same time, technology and digitalization have become increasingly important enablers of this ambition, enhancing convenience for guests while supporting operational execution and data-driven decisions making at scale. Luis already covered the key full year highlights, so I will skip Slide 2 (sic) [ 12 ] and move directly to Slide 13 to walk you through the main financial highlights for the fourth quarter. Turning to the fourth quarter. Revenues amounted EUR 636 million, representing a 1% increase versus the fourth quarter of 2024 and the same-store sales index stood at 96. We have already discussed the temporary factors behind this performance in addition to the underlying macro backdrop. We also faced an external headwinds. However, we are not satisfied with this. We want to be clear that we are taking decisive actions to improve, and we are already seeing the situation improve progressively. It is also important to highlight the divergence we continue to see across markets.

Most of our core markets delivered solid progress, most notably Poland, where quarterly revenues increased by almost 6% year-on-year in the fourth quarter or by 9% on a full year basis. On profitability, the sales evolution meant that we kept the EBITDA margin close to 17% in the quarter, resilient but still clearly below the group's potential and objective. We continue to view the drivers of largely temporarily as we expect a gradual improvement in profitability as sales trends recover and operating cost pressures eases over time, both on food and labor. As you can see on the slide, fourth quarter EBITDA amounted to EUR 106 million, while EBITDA non-IFRS 16 was almost EUR 58 million, implying a margin of over 9%. On the other hand, the operating profit for the quarter reached EUR 26 million.

Finally, cash generation remains strong. Operating cash flow in the quarter was EUR 109 million, while investing cash flow was below EUR 46 million, reflecting the continued decline of investment intensity and our disciplined approach to capital allocation. Moving to Slide 14, please. On this slide, you can see the evolution of the group's quarterly revenues over time, reflecting the natural seasonality of our business. At the same time, digital sales gained relevance, particularly in the QSR segment. Excluding our casual dining brands, digital sales represented a primary route to market in 2025, reaching around 62% of total sales. We see this as a very exciting opportunity. It strengthens the way we interact with our guests, enhances convenience and give us additional levers to build loyalty and improve our commercial effectiveness through a more personalized and data-driven consumer engagement.

With that backdrop on revenues and the growing weight of digital channels, let me move to Slide 15. where we summarize the evolution of our profitability, tracking EBITDA and EBIT and how margins progressed through the year. As discussed, EBITDA in the fourth quarter was over EUR 106 million with almost 17% margin, broadly stable versus the recent quarters. In terms of EBIT, the generation was EUR 26 million with a 4.1% margin. The key message from my side is the resilience of profitability with our focus on gradually restoring operation leverage. Now moving to Slide 16. Let's look at our cash and debt evolution and more broadly, our liquidity and leverage position. At year-end, AmRest net financial debt stood at EUR 518 million. Leverage increased to 2.3x as expected, sitting at the low end of our internal target range, an area where expected to operate over the coming quarters.

Finally, the group's liquidity at year-end was over EUR 146 million, a decrease of EUR 7 million versus the prior year. This reflects an efficient liquidity position, supported by the additional unused committed lines in more than EUR 140 million. This financial risk profile provides a prudent use of resources and a solid liquidity that we consider to be efficient, fully aligned with the group's operating needs. In summary, keeps us well positioned to support the business while maintaining disciplined capital allocation. With this balance sheet context, let me now turn to the operating view by geography. Turning to Slide 17, you can see the breakdown of revenue, EBITDA and restaurant count across our segments. These segments span our footprints across 22 countries. And after several years of broadly synchronized trends, we are seeing a more differentiated set of dynamics across markets.

In other words, performance is increasingly driven by local market dynamics, which also creates opportunities to allocate resources more selectively and accelerate improvement where the upside is the strongest. Turning to Slide 18 and 19, we present the key metrics of Central and Eastern Europe, our largest segment. In 2025, annual sales in this segment amounted to EUR 1.6 billion, representing a year-on-year growth of 6.5%. At country level, Hungary posted double-digit growth of 10.2%, while Poland also achieved a strong performance with almost 9% increase in revenues. EBITDA generated reached EUR 306 million, representing an EBITDA margin of over 19%. Profitability remains solid and broadly consistent across regions, with Hungary posting the highest margin at almost 21%, while other markets delivered comparable levels.

Looking at the fourth quarter, revenues totaled EUR 394 million, 1.2% higher than in the same quarter of 2024. EBITDA was over EUR 78 million, representing an EBITDA margin of almost 20%, broadly flat year-on-year. Finally, the restaurant portfolio in the region reached 1,283 units after increasing by 55 restaurants with the opening 28 units during the last quarter of the year. With this, let's now move to Western Europe in Slide 20 and 21 to discuss the performance and key dynamics of that region. Revenues in this segment amounted to EUR 870 million for full year 2025. This represents a 3% year-on-year decline. EBITDA generated amounted to EUR 121 million, resulting in an EBITDA margin of 14.8%, 0.3 percentage points lower than the prior year. Performance diverged significantly by country. Spain, AmRest's second largest market, delivered flat sales versus last year, while Germany recorded almost 5% growth, supported by continued momentum in the market.

By contrast, France experienced a 13% decline, reflecting a more challenging trading environment and weaker consumer confidence. In the fourth quarter, sales reached EUR 221 million, a decrease of 4%, which represents to the same period of 2024. EBITDA stood at EUR 33.5 million. This is an EBITDA margin of 15%, more than 1 percentage points below the prior year. Finally, the total number of restaurants in the region stood at 771 units after 19 openings and 32 closures. Approximately half of the closures occurred in France, reflecting ongoing portfolio optimization efforts and a focus on improving the quality and profitability of the market. With that, let me move to the next slide and briefly comment on China, where we operate the Blue Frog portfolio.

This segment is smaller in scale, but strategically important, and we remain focused on protecting relevance and profitability while navigating a more volatile consumer backdrop. Revenues generated during the year stood at EUR 85 million, which is 8% lower than in 2024. The depreciation of the Chinese yuan against the euro was the key headwind. In local currency, sales decreased by 4%. Despite the softer top line, EBITDA amounted over EUR 16 million, implying a solid EBITDA margin of over 19%. In the fourth quarter, revenues were EUR 20 million and EBITDA reached almost EUR 4 million. With this, EBITDA margin improved to over 18%, almost 0.5 percentage point higher than 1 year ago, reflecting ongoing cost discipline and operational focus despite the more challenging trading environment. The restaurant portfolio closed 2025 with 85 restaurants in the region after no openings during the last quarter of the year. And with this, Luis, I believe we are ready to take questions from the audience. Many thanks.

Thank you, Eduardo.

[Operator Instructions]

We're going to start perhaps with some questions that we have received in the box. The first one is asking about the situation in Hungary during the 4Q of the year if the performance that we have seen in the market and the strong revenue growth is coming from any one-off in this market?

No. Hungary has been last year and so previous years as well, a growing market. I think we have been very pleased with the performance, customer confidence and traffic has been growing. And so it has been one of the best years as we have seen in the percentage of margin that Eduardo just mentioned, reaching to almost 21%. So it was a great one and nothing as one-off. It was a continuous operation.

Thanks, Luis. We have the next question referring to Czechia. Do you see already the normalization of sales in Czechia following the allegations of food safety?

Yes, Santiago. And let me be very transparent on this issue. AmRest performance sales in Czechia were negatively affected in the final months of 2025, following misleading allegations about food safety spread through social media. We at AmRest take food safety very seriously. And always, we are fully committed to rigorous food safety standards, and we conduct comprehensive reviews across our network. We do combine robust internal controls and also independent third-party audits. And saying that in this context, AmRest has also submitted itself to hundreds of additional audits and inspections conducted by both the respective brand owner and the competent health and hygiene authorities. And gladly, the results of this out is identified, no systemic issues and all restaurants continue operating normally. So after this event, I think we are observing now a progressive recovery, Santiago.

Thank you, a very detailed answer for this issue. The next question is related to CapEx. This says what CapEx levels do you expect to reach in 2026 and 2027?

In terms of CapEx, we addressed the topic during the call. And we expect similar levels to the ones that we had in the previous year. And we want to be very objective on this and focus on 2 main topics. openings, and we are doing a very detailed procedure in terms of getting sure that those openings give the returns that are expected by the company. And on the second topic is very important, the renovations that we are doing across the organization. This is very important to us because it's part of the service level that we give to our consumers. So it's important to have updated the restaurants to have a very good experience in our consumers. And also, this drives additional transactions and sales during the reopening of those restaurants.

Eduardo, let me jump in because I think it's also significant that the usage of CapEx this year has been outstanding and greater to previous years. I would like to highlight the efforts made by the teams into how to improved efficiency of the jobs of the construction of the supply, everything, all the parts related to CapEx investment has really saw an improvement. And I think the efficiencies that we are observing will stay even improve for longer. So those are good signs and good data that really allow us to be more positive about how the -- we're flying in the same level of CapEx be more effective on the usage of the capital.

Okay. Thank you very much, gents. The next question that we have is related to the dividends. And they are asking if AmRest is planning to establish an official dividend policy, and we can expect or we have any guidance with respect to next year's dividends?

We are focusing on the cash flow of the company, mainly enhancing the operating part of it. So at this moment, the results are the one that mark the dividend that we can share. So our focus right now is on cash flow and the Board of Directors will take the decision depending on the level that we generate as a company.

Okay. Thank you very much. I don't know if we have any further questions, operator?

Maybe I will take the privilege of moderator and ask a couple of follow-up questions. First of all, I would like to ask about Czechia. You said that you are seeing gradual improvement. Can you share with us what kind of same-store sales are you observing in Czech Republic in the first quarter of this year?

As I said, after this impact on the last month of last year and let's say, the customers has been more aware of the real status of our safety and our conditions and the restaurants, the trust is recovered and the granted operation trust and confidence is showing back. So the performance is gradually recovering. It may take some time. We don't have a clear vision on that. But definitely, we see just positive week-on-week. So this is good news.

Okay. And in the presentation, you also shared with us that you are considering new brands and new concepts. Can you shed more light on that? What kind of a brand, what kind of concept, just even the direction, where are going?

Sure. Sure, Lukasz. The company has been always evaluating and assessing different perspectives of how to improve and grow our portfolio. And in that regard, we continue doing that. Obviously, we are looking forward to onboard brands that increase our reach through different business proposals. And that's an important thing because I think the diversified portfolio of brands that we operate is one of the strengths of AmRest. So we want to keep expanding that and from there, looking forward. When I cannot disclose that, but we are seriously working on that topic.

Okay. And on the flip side, you are still in a cleanup at closing down the less efficient part of your network. And as I understand that's also the plan for 2026. Can you tell us which restaurants, which markets are under your consideration?

Yes. This is also as well a dynamic exercise and a dynamic assessment. And as you can imagine, there are brands and territories and customer dynamics that are changing in the years. We expect to keep running in the same level of closures as we saw in the last years. This is a discipline that we are taking to really be present where the consumer occasions are now and also to be sure that our profitability is not dragged out by underperforming stores. So probably the same level. I expect that for a couple of years, we still have some areas to keep working on, and that will be the reference as same as we did this past year.

Can you give us any details on the markets or brands or you will like to say as you are now?

Well, probably, this is a variety of actions because not all markets do have a continuous trend. And saying that, what one market was a target 1 year, another one will be next. This is on many occasions also related to leases agreements with landlords. So it's not geographically driven and some occasions are regulated by contracts, disposals and so on.

We have received in our box an additional question that is asking about the evolution of the EBITDA margin in Germany during the fourth quarter of the year. I don't know if perhaps Eduardo, you can answer this.

Yes. Thank you, Santiago. There's an important extraordinary element in there. We registered a fire, and we needed to make some bookings in the fourth quarter of 2024. But the good news on that topic is that now that is normalized and the market is recovering.

Thank you very much, Eduardo.

[Operator Instructions]

Okay, if there is no further questions. I don't know is...

No. Thank you for joining the call today. I think it has been a challenging year, no doubt. I think the markets across the different geographies we are facing are in different momentums of their evolutions. Gladly, AmRest's diversity in brands and geographies allow us to compete heavily where we have bad wins. The good thing is I think the company has gone through a very, very selective exercise of how fine-tuning our processes. We have kept investing in good systems. Our profitability keeps moving up and the margins are also solid. I have good feelings, and I think this is a topic Santiago, no one mentioned that I think second half of the year their forecast in this industry about some commodity or goods prices that are looking to go down as chicken, beef and coffee that as you know very well, these 3 in the last 2, 3 years were very volatile.

And I think we are observing potential decreases in prices, especially on the coffee side because great harvest in different territories, but also beef that we name internally deflation seems to be now stabilizing. And those 3 things have no more than positive forecast outcomes to our business. So I'm also expecting those to land in reality somewhere in the second half of the year. Saying that, thank you very much for the coordination of the call on the other end and looking forward to share with you more news in very short. Thank you, everybody.

Thank you very much.

Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.

Good afternoon, everyone, and welcome to the AmRest Q3 2025 Results Call. My name is Brika, and I will be coordinating your call today [Operator Instructions] I would now like to hand you over to your host, Lukasz Wachelko to begin. So please go ahead, Lukasz.

Good afternoon, ladies and gentlemen. My name is Lukasz Wachelko, I'm representing WOOD & Company. And I have again a pleasure of moderating the call with management of AmRest to present to you the results of the third quarter of this year. The company is being represented by CFO, Mr. Eduardo Zamarripa; and IR and Strategic Director, Mr. Santiago Camarero Aguilera. Guys, the mic is yours.

Thank you, Lukasz. Good afternoon, and thank you for joining us in today's third quarter 2025 AmRest results presentation. It is my pleasure to share with you an update of AmRest situation at the end of the quarter. During the third quarter of the year, despite ongoing trade tensions and geopolitical uncertainty, both global and European economies showed resilience though Europe's lagged the global average. Across Western Europe, activity stayed mute.

Growth was modest, helped by public investment and easier financial conditions but weighted down by weak exports and cautious consumer spending. Inflation moved closer to the ECB 2% target, allowing monetary policy to stabilize after an earlier rate cut. However, disposable income growth remained limited due to past fiscal tightening and high living costs, keeping consumers confident fragile.

In Eastern Europe, growth slowed sharply versus the previous quarter. Fiscal consolidation like VAT hikes and subsidy costs hit household consumption, while inflation stayed above target in many countries, eroding real incomes. In the case of China, its economy held steady about 4.5% year-on-year growth rate, supported by a manufacturing rebound and targeted fiscal stimulus.

Household spending improved slightly, thanks to tax rebates and easier credit but confidence remained soft. With that context, we'll now review our third quarter results, financial performance and outlook before opening the floor for your questions. Please note that today's remarks may include forward-looking statements subject to risks and uncertainties. But let's start with today's presentation. If we go to Slide 2, please.

As a reminder, AmRest is a leading multi-brand restaurant operator in Europe with 2,110 restaurants across 22 countries in Europe, the Middle East and China. We are proud to operate some of the world's most iconic and reputable restaurant brands. Our portfolio combines global franchise brands, KFC, Starbucks, Pizza Hut and Burger King with proprietary concepts such as La Tagliatella, Sushi Shop, Blue Frog and Bacoa, positioning our businesses across quick service, coffee, fast casual and casual dining.

Every month, our restaurants welcome over 30 million guests, served by more than 44,000 AmRest colleagues, a scale that allow us to deliver consistent value and service across formats and geographies.

If we move now to Slide 3, I'm going to try to summarize the most relevant financial KPIs and events for this quarter. First, we hit historic sales record of EUR 660.5 million for a third quarter with a 3.5% increase when excluding the impact of the asset disposed during the year. In this case, let me remind that we sold our equity stake in SEM business at the end of the first quarter. And as a consequence, we deconsolidated all the assets and liabilities associated to the business since then. The idea behind this transaction has been to internalize and optimize the value generated in the chain management and product quality assurance services.

Second, EBITDA reached EUR 111.2 million, which a solid margin of 16.8%. The operating profit reached EUR 42.3 million with a 6.4% margin, while the net profit achieved at EUR 15.8 million. Leverage stood at 2.1x and the low end of our internal target range. Finally, during the quarter, we opened 16 new restaurants and renovated 46 units, continuing our commitment to growth and modernization. In the following slides, we will go into more depth and detail of these points.

But let's start first with what we are doing in our different brands on Slide 4. The commercial position of our brands plays a crucial role in the value generation of AmRest. Let me start with the KFC, La Tagliatella and coffee brand in this Slide 4.

At KFC, we continue to deliver both locally relevant experiences through dynamic campaigns and seasonal innovations. The California Summer campaign brought different offerings, complemented by a strong value proposition. We amplified engagement through the high-impact promotions. And for instance, our largest partnership of the year with the EuroBasket during the summer months. In addition, regional highlights included the Street Food Festival in Czechia and Hungary, introducing global flavors like [indiscernible] and Korean K Zinger.

These initiatives strengthened brand image, boosted basket value and reinforce customer loyalty. At La Tagliatella, we continue to push culinary boundaries, partnering with Michelin-starred chef Carlos Maldonado to elevate brand perception and attract new audiences. This bold collaboration fuse Italian tradition with Maldonado's avant creativity, resulting in 4 exclusive dishes. The initiative delivered double-digit growth within our historical additions category, positioning La Tagliatella as an innovative leader in the restaurant sector.

At Starbucks, we continue to strengthen our coffee leadership while embracing evolving consumer trends. Core coffee growth accelerated with espresso-based beverages reinforced by our back to Starbucks strategy centered on quality and tradition. Seasonal beverage launches continue to drive customer engagement, while growing interest in wellness and personalization is reflections in the strong appeal of matcha-based offerings.

Now let's continue with our brand in Slide 5. At Sushi Shop, following the strong momentum for our Rubik's Cube collaboration during third quarter, we launched our annual summer receipts edition. The result resonated strongly with consumers prompting us to extend the offer into the September to maximize engagement.

At Blue Frog, we strengthened our bar, identity and local relevance through 3 key initiatives: refresh drink menu, where we introduced higher quality creative options to elevate the all-day bar experience. Chinese Valentine's Day with a premium [indiscernible] and [ Thin ] cocktails created a festive romantic atmosphere. And third, our city-limited series locally inspired dishes and cocktails showcased authenticity and deepen the connection with regional audiences.

At Pizza Hut, we strengthened innovation leadership through both consumer-focused initiatives. Globally, Pizza Hut introduced the Pizza Cheese Burger range, a mashup concept blending classic cheeseburger flavors with Pizza Hut signature pizza format. This range targeted Gen Z, and value-seeking consumers, supported by gaming and delivery partnership. These campaigns strengthened Pizza Hut reputation for both flavor innovation, resonating strongly with consumers.

And finally, in third quarter, Burger King brought anime culture to life in Poland, Czechia and Romania with a special Naruto theme activation. Restaurants offer exclusive meals per with a collectible toys turning BK into a destination for anime fans and driving engagement, brand affinity and incremental sales.

If we now move to Slide 6, please. Core revenues on a comparable basis grew by 3.5% year-on-year, underscoring the strength of our portfolio. In addition, we continue to see steady progress in the 12 months trailing average sales per equity store, driven by an optimized channel mix, disciplined pricing strategies and positive impact in recent renovations. These combinations of per store productivity and selective expansion reinforces our ability to consistently improve unit economics across the network. As a result, AmRest delivered resilient store level performance that supports sustainable growth despite the temporary challenges faced in several markets.

Moving to Slide 7, please. In the third quarter of the year, digital orders reached 62% of total transactions, a clear testament of accelerating adoption and shifting consumer preferences. This transformation is powered by our omnichannel ecosystem which integrates proprietary kiosk, mobile apps, web ordering and third-party aggregators. By leveraging these platforms, we deliver personalized promotions, unmatched convenience and a seamless experience across every touch point.

Digital remains a core pillar of our growing strategy, driving both customers' engagement and operational efficiency. In summary, our robust digital adoption underscores 2 things: challenging consumers' behaviors and our commitment to innovation. That speed of service improved consistency and drives ticket growth. In short, digital continues to be a strategic lever for sustainable value creation.

Now moving to Slide 8. As we have covered in previous calls, our underlying restaurant growth is complemented by strategic adjustments to nonperforming businesses made since 2022 which have led to the end of certain commercial agreements or disposable of some businesses during this period. These decisive moves are aimed to sharpening our capital allocation and focusing the portfolio on the most resilient and profitable formats, ensuring that our footprint is configured for sustainable long-term returns.

Today, AmRest operates directly or via franchisees a portfolio of 2,110 restaurants across 22 countries and 8 brands, following the opening of 16 new restaurants and the closure of 14 during the quarter.

With this, Santi, if you can cover the main financial highlights, please.

Thank you, Eduardo. Thank you, everyone, for joining us. Our objective today is to try to be clear on what is working and transparent about what is -- what we are improving in our business. We continue to see healthy sales performance despite temporary macro headwind in several markets, and this is supported by a balanced brand and market mix as for a disciplined commercial execution.

In this regard, pricing remains critical as we need to balance protecting traffic and brand health while offsetting cost inflation. Digital occasions are a structural tailwind. Guests are choosing our apps and aggregators for convenience, speed and value. And this trends across global QSR, where convenience led by omnichannel ordering continues to expand. We are progressing and refining offers through a better and wiser usage of data to increase attachment and order value.

Second, our operating profitability is resilient, though shy of where we expected a few quarters ago. This reflects sector-wide wage and input cost dynamics and in some markets, a more value-sensitive consumer. We are staying agile, tightening cost control, prioritizing high-return initiatives and using target promotions that reinforce value without diluting the brand. This playbook is consistent with our strategic view of value discipline, operational efficiency and risk management to protect margins through the cycles.

We have delivered an improvement in terms of the operating profit, underpinned by lower impairment charges and a sharper focus on the quality of earnings. That improvement is a function of many small structural gains product at a single lever.

Finally, our balance sheet remains strong. We continue to generate solid cash flow and capital expenditure is not only well controlled but trending lower, while still leaving us ample flexibility to invest in digital initiatives, operational enhancements and the most attractive new unit opportunities. All of this is achieved while maintaining prudent leverage and preserving the capacity to navigate uncertainty.

So with this in mind, let's turn to the Slide 10, please, for the quarter's financial and operating highlights. Most of this has already been covered by Eduardo but let me give you a quick recap. Quarterly sales came in just under EUR 661 million, which is a 3.5% increase year-on-year when we exclude changes in the consolidation perimeter. Same-store sales held steady with the index close to 100, showing a stable performance across comparable units.

EBITDA for the period was a bit over EUR 111 million, giving us a margin of 16.8%. On a non-IFRS basis, this is excluding leases effect, EBITDA was EUR 64 million with a margin of 9.7%. And operating profit reached EUR 42.3 million, which represents a margin of 6.4%.

During the quarter, as addressed by Eduardo, we opened 16 new units, and we kept the CapEx below EUR 34 million, reflecting our disciplined approach to capital allocation and focus on high return opportunities. And finally, as at the end of October, our same-store sales index remains around the 100 level.

Moving to the Slide 11, please. Our group delivered a record third quarter revenues of EUR 661 million. That is likely from -- this is slightly up from last year, about 0.2%. And if you adjust for businesses with this consolidated earlier, growth came in at 3.5%. Now I think that it is important to recognize the context, the quarter wasn't without challenges. Consumer confidence stayed weak and cost of living pressures continue to squeeze disposable income. That means less discretionary spending in restaurant, especially towards the end of the summer.

But here is the positive. We see these conditions as an opportunity to strengthen long-term loyalty. We are focused on giving customers what they want, great flavors at a attractive price points, smart bundles and value-driven offers. And we are using our digital platforms to personalized promotions and to make the experience as convenient as possible. One last note on comparisons last year, Q3 numbers included EUR 9.3 million of extraordinary income from refunds which boost revenues and profitability.

Turning now into the Slide 12, please. We will focus on EBITDA performance for the third quarter. EBITDA came in at EUR 111 million, with margins holding around 17%. This demonstrates our ability to maintain healthy profitability in a dynamic market environment. The bridge of this slide shows how we have protected unit economics through effective labor management and productivity initiatives.

These actions has helped us to offset inflationary pressures and competitive challenges, keeping operational efficiency strong. In the case of the operating profit for the quarter, we delivered EUR 42 million, representing a margin of 6.4%. This is a decline of 2.7 percentage points compared to last year.

Looking at the first 9 months of the year, cumulative EBITDA reached over EUR 300 million with a margin of 15.6%. Operating profit for the same period totaled almost EUR 90 million. That corresponds to a margin of 4.7% which is an improvement of 0.3 percentage points versus last year.

Moving now to Slide 13, please. I would like to highlight a few important developments in our restaurant portfolio and financial performance in this slide. First, over the past 12 months, our net equity restaurant count grew by 59 units. This reflects our commitment to selective growth in markets and formats with the highest potential. At the same time, the number of franchise restaurants declined mainly due to the transfer of the Pizza Hut France business. This move was part of our ongoing strategy to optimize the portfolio and concentrate resources where they can deliver the greatest returns.

From a financial perspective, Net profit for the quarter was just under EUR 16 million. That's below last year's figure. But remember that last year included some one-off items that I mentioned earlier. And finally, also as I noted before, we continue to see a gradual reduction in terms of CapEx, reinforcing our disciplined approach to capital allocation and also I covered that point before.

Let's move now please to the Slide 14, which provides a detailed view of our liquidity, our leverage position. Our overall risk profile remains broadly unchanged with our net financial debt now at 40 -- sorry, EUR 503 million. Importantly, leverage stands at 2.1x, right at the low end of our internal targets. And once more, this reflects our disciplined approach to financial management and our commitment to maintaining a strong balance sheet while continuing to invest selectively.

At the end of the quarter, we held nearly EUR 145 million in cash, and we have access to an additional EUR 215 million via committed credit lines. All this ensures that our liquidity position remains prudent and efficient, fully aligned with the group's operational and strategic mix.

On Slide 15, you can find an overview of our financial debt structure and also the maturity profile. As you can see, there has not been significant changes compared to the previous quarters. Our funding remains stable and well balanced with the vast majority of our debt denominated in euros. The maturity schedule is well levered with a clear long-term orientation.

If we move now to Slide 16. We can find the breakdown of revenue, EBITDA and the number of restaurants that we have in each geography. This segment comprises businesses in 22 countries where once again, we have observed very different commercial dynamics. So as usual, let's start with Central and Eastern Europe, our most significant region, please, that you can find all this information in the Slide 17 and 18.

In the third quarter, the region delivered sales of EUR 421 million, up 7.8% year-on-year and accounting for almost 64% of total group revenue. Looking at individual markets. Hungary posted double-digit growth of 10.3%, while Poland also performed strongly with almost a 9% increase. Regional EBITDA came at EUR 86 million with a margin of 20.4 percentage that represents a decline versus last year but keep in mind that Q3 '24 included more than EUR 8 million in refunds.

So excluding this one-off, the EBITDA grew by 1.3%. Finally, the restaurant portfolio in the region is totaled 1,255 units at quarter end, following 8 openings and 2 closures. For the year so far, we have opened 35 restaurants in the region and closed 8.

Let's move on to the Slide 19 and 20, please, to review Western Europe. Sales in this region for the third quarter totaled EUR 219 million, which is a 2.7% decline compared to the same period of last year and once more performance embody very drastically by different markets. In the case of Germany, we delivered a solid growth of 6%. In Spain, we held steady numbers, very similar to last year, while France continued to face big challenges with sales down almost by 14% due to weak consumer confidence.

EBITDA for the quarter was EUR 32 million with a margin of 14.7%. This is broadly in line with last year. The restaurant portfolio closed the quarter were 770 units following 4 openings and 6 closures. And for the first 9 months of the year, we opened 10 restaurants and closed 24.

If we go now to Slide 21 and 22, we have our performance in China, where sales for the quarter were EUR 20 million down 10% in nominal terms, but on a constant currency basis, so local figures, the decline was less than half of this figure, so this is below 5%. These numbers reflect the impact of a challenging macroeconomic environment and a global slowdown in consumer spending, which weighed on business generation.

To address these headwinds, we are accelerating initiatives focused on value-driven menu innovation, strengthening digital engagement and optimizing operational efficiency. These actions are designed to protect margins and reinforce brand relevance in a more price-sensitive environment. In terms of profitability, EBITDA for the quarter was EUR 3.5 million with a margin of 17.4%. And finally, at quarter end, the Blue Frog portfolio comprise 85 restaurants following 4 openings and 1 closure. Year-to-date numbers, we opened 7 restaurants and closed 9.

And with this, back to you, Eduardo.

Thank you, Santi. To conclude, this quarter reflects both resilience and the reality of a tougher operating environment. While we achieve record revenues and maintained solid margins Growth was tempered by persistent macroeconomic headwinds, with consumer confidence, cost of living pressures and on even regional performance.

We are not satisfied with these results and we are taking decisive steps to improve. Our priorities include accelerating digital engagement, sharpening value propositions, optimizing operational efficiency and maintaining a strict discipline and capital allocation. These actions are designed to protect profitability and strengthen branded relevance in a more price-sensitive environment. In light of these dynamics, we are revisiting our revenue and profitability guidance for this year to reflect current market conditions and the timing of our improvement initiatives. This adjustment is a prudent step to ensure transparency and set realistic expectations.

In this regard, we expect to close 2025 with a low single-digit growth in sales and with an EBITDA margin slightly above current year-to-date that I remind you is 15.6%. Finally, the number of restaurants to be opened will be below last year numbers.

Thank you for your continued trust and partnership. We remain committed to delivering sustainable value and will now open the floor for your questions. Many thanks to everyone. And with this, we are open to any questions that you may have.

[Operator Instructions] The first question we have from the phone lines comes from Jakub Krawczyk with ODDO BHF.

Hopefully you can hear me. Here is Jakub Krawczyk from ODDO BHF. I have a couple of questions. Question number one, can you please elaborate on these refunds that were the one-off in Q3 '24? I just want to understand what the nature of these refunds are? And is this something which maybe can occur again.

And question number two, France, okay, and Sushi Shop. Can you tell us -- give us a bit more color on what is the -- what's going on there? How is the restructuring going? What's the weakness? Why has -- the measures you have undertaken so far not really materialized in terms of -- or not translated to an improvement in the numbers? And what can be done? And what's the time frame? What are your expectations for this business for Sushi Shop specifically?

And I guess a follow-on how does Sushi Shop perform outside of France? Is it equally weak or not?

Okay. Thank you, Jakub for your questions. Now related to the first one that you make in terms of the refund, that's something that was a onetime effect. So we should not be having any refund like this in 2025.

Then related to the question that you make on Sushi Shop, I would say that we have to split this in several topics. And first, we need to consider that the situation on the French market is quite challenging. Consumer confidence is going down and consumption is also challenging. That's why also we have some plans that we have been working on in the French market, talking about Sushi Shop but also the other brand that we operate there.

Now topics that we have been working on. First, in terms of the stores, we have made the deep analysis of the stores that it makes sense to keep. And we have some stores that are big bleeders which do not make sense to continue working with. So we're restructuring that and closing the stores that do not make sense to have there.

And we have 3 clusters in terms of stores, the ones that are profitable. And then the ones that we have a [indiscernible] stores, the one that they have a potential to increase the performance. Because of the operations, and the others that, as I said, they are heavy losers and makes sense to close. So that's part of what we are doing of what we are doing over there. Delivery strategy. As you know, Sushi Shop is fairly highly concentrated in delivery.

So negotiation with the delivery companies in order to keep being relevant in the segment and be on the first pages of the applications. And at the same time, also strengthening our own delivery channel. The application is something very relevant, creating loyalty programs for our consumers also is quite relevant for us. We are working also in terms of the menus that we are offering reviewing that, which are the SKUs that have the highest consumption and keeping those and making the analysis of the one that do not move that much, so making menu efficiencies.

And also innovations, new boxes that we are launching new roles that we are launching and innovation is something that plays a big role in a segment like in a segment like sushi.

One of the facts that we also have in the past and right now in procurement, we are making a lot of advances in terms of the prices of the salmon. As you know, there was a big disruption in previous year in terms of the price of salmon. And right now, our procurement team is having very good negotiations in those fronts. Also renovations of our stores a design, which we have a warm, welcoming ambience, the colors that are there that invite you to spend a very nice time. And also working on the lightning of the places. So it's having a better environment overall in order to buy -- our consumers to be there given the reality that we have, a dine-in which is a small part of the business but working a lot on the value proposition for the consumer for the delivery.

Yes. I mean, if I may to add over here. I mean, I understand the relevance of the question, given the performance that we have seen in the French market, the situation that we have in the past with the investment in Sushi Shop. But -- there are many small levers, as Eduardo was mentioning, many different things that are really turning the boat and the situation of the brand.

It's very important the question that you ask Jakub, with respect to the performance in the different regions. And just to remind you, for the Sushi Shop the core business, the origin is France. But currently, we are running business in Belgium, Switzerland, Spain, the Gulf region, Luxembourg, and in most of these markets, what we are seeing is a quite positive performance with all these initiatives that we are putting on the table that invite us to think that the situation, the macro situation that we are living in the French market is preventing to unleash the value of all these initiatives that we are deploying at the moment. Thank you very much for the question.

That's very useful color. Can I just -- would it be farfetched to assume that for the moment, you're not considering more radical changes to this own brand such as exit or something like that at this point. I guess you're still in a mode to fix it, correct?

We are focusing all our efforts in order to deliver results in this brand in France.

[Operator Instructions]

Okay. So maybe I will use my previous moderator and ask a couple of questions from my end. First of all, as a follow-up to Jakub's question. In France, do you see any [ signs ] of the things getting better, are there any time lines and the milestones you have set? Do you have any visibility when the things can get better? That's the first one.

Thank you for the question, Lukasz. And for us right now, the most important thing is to work on the improvements that we were mentioning. We have several initiatives across that. We have a plan put in place by the Brand President of the brand, and there are direct involvement of all the functional leaders.

Now the CEO is involved on that execution plan, as you can imagine, also I'm quite involved on that. Also operations. So this is a priority. This is one of the priorities of the organization. Right now, I prefer to focus more on the things that we are doing more than to enter into which is the timing. But I want to assure that this is one of the priorities that we have in the organization in this 2025 and is still a priority for 2026.

Okay. And I also have a question about the Polish market when we see Zabka a leading convenience chain developing pretty fast. And this year, they started the rollout of a pretty nice offer of QSR products. Do you see any impact of that? Do you find them competitors -- should we expect any impact of those developments with offering a pizza on your numbers? How do you see it?

Competition is something that is in the day-to-day operations of the restaurant industry, as you say, this is one of the emerging competitions with the products that they are offering. That's why also for us, it's very important to work on the -- on our consumers to work on the development of new products, on new occasions of consumptions, on improving the experience that the consumers that our clients have. And that's why we made particularly a section in this conference call in terms of the topics that we are putting on the table to attract consumers, Generation Z, but also and all our consumers to keep our brands relevant.

That's what is relatively important for us. Now how we keep our brands relevant what makes us unique what makes us different. And the value proposition that we give and the development of new products is something that is quite relevant for us. But you raised an interesting point, Zabka, as you say, but it's also supermarket, the ready-to-eat segment in supermarket is increasing. That's a reality, and we need to adjust our strategy towards new realities that are happening there. But as always, we welcome competition, and that makes us be better every day.

Okay. And another question from my end before I let others is regarding the Czech market. When we were seeing recent negative news flow on the problems with quality or food safety in KFC. I understand the second restaurant was under the spotlight recently. So can you shed some light on that for us? What's happening there, how serious it is and one can take us?

Thank you, Lukasz, for the questions. We take matters of health and safety very seriously and we have very strict food and safety protocols in place. Our restaurants regularly undergo multiple levels of quality and safety oversight, including external audits for independent third parties, internal foodservice controls and also inspections from national and local authorities. Across these hundreds of audits in Czech market, including 250 inspections conducted year-to-date by state authorities alone, we have not found any issue related to the systematic mishandling of food products.

No, I mean, I think that, that's the point that we are really seeing many more audits that we have before, but all of them, they are coming up with positive outcome. I think that 1 of the points that is always important to remind that the level of checks, audits, protocols that we have in terms of health safety, I mean they are unparalleled in the industry. So if 1 thing we can be very proud, I think that is this specific point.

[Operator Instructions]

Okay. So maybe in the meantime, we'll have another question Germany, there's the market when you were [indiscernible] for longer while but, in fact, I believe it was rather the previous quarter when the things stabilized and got better. And this time around also see a decent performance there. So -- what has changed why well Germany and also Hungary are performing above the other markets?

Well, for Germany we have to take one consideration still is one of the challenging markets that we have. But as we were mentioning also with Sushi Shop in Germany is exactly the same. We are working in order to improve the experience that our consumers are having over there. The main brand that we have in Germany is Starbucks, and we have work a lot in order to improve that experience, as I was saying, through the development of new products, new beverages, also increasing the offering that we have in terms of food and going back to the roots of Starbucks is what is helping us to improve the results on that market.

Okay. And what about Hungary? Because this market is also standing out in the perspective.

And you raised a very good one. If we make the comparisons versus the third quarter of last year, among the biggest markets that we have Hungary was outstanding in terms of -- it was outstanding in terms of results. And it's execution, execution and execution over there.

We have received some writing question. I guess some of them, they have already been addressed. So thank you for it, but I'm going to try to read the ones that they have not been addressed yet.

One of the question is, one, what are the main reasons for slowing sales dynamics in Spain despite the strong tourist and macro in the country.

And here, one of the point that is important to bear in mind, I think it's always we have a very strong seasonality in terms of our business, depending on where your restaurants are placed, are situated, the seasonality is going to change. So that is why I always suggest that it's important to see from an aggregated perspective, really in 12 months average, I think that provides a better picture. And there, what you have is a strong momentum in our restaurants. The challenge in terms of the situation in Spain is very similar to other countries despite of the good macro figures that we have that is the cost of living pressure that many people are suffering and this is, of course, affecting consumption. But when you see the aggregated figures and the growth that we have, we have very positive dynamics, sales growth, pricing margins, and to be honest, we are quite positive about the future of our brands in the country.

We have received also another question regarding Hungary that I think that we have already addressed about the very good performance that we are recording in the country. An additional question is asking, what are the main reasons for the like-for-like performance that we have in this quarter?

And I think that this has also been addressed. We have some markets, and we are having a quite poor performance. We already addressed the situation that we have in France with a drop of 14% in terms of sales. This is one of the very big markets for us. So this is, of course, affecting the like-for-like figures of the whole group.

And I don't know if we have any more questions on queue, operator?

We currently have no questions in the queue, [Operator Instructions] And Santi, we have another question. So I'll hand back to Santi to read that.

Sorry, I'm just trying to see the question. I'm not sure what is referring the question, apologies.

I think it is related to G&A. I think under this quarter, we have -- as we have seen the performance of the market, we have been also very focused in terms of how we control and tightening our G&A in order to balance the results.

Also, we have a question in terms of if we are seeing a more cautious consumer in Poland?

And I think in a certain way, we also have are we have addressed this question in terms of consumption confidence across Europe is something that we look very, very closely, and we see how we can improve through the different products that we offer in our restaurants to deliver -- been able to deliver value to our consumer. Now one of the things that, yes, we are seeing the promotional activity has increased and the promotional -- the menus that we have are having an important way in our -- weight in our mix, so we are seeing these kind of effects in the consumer. But what is relevant is that through the value proposition, the products that we deliver and the menus that we have been able to offer to our consumers, the solution that they have in terms of full consumption in our restaurants.

If I may here, I think that it is important to highlight also one topic. So we have addressed today in previous occasions, also know what is the complex context that we have from this macro perspective, our consumer confidence is weak in many different countries. And once more, we have to reverse the effect of the cost of living standards that the accumulated inflation that we have on the latest years is having on consumption. We are not immune to this. So this is a temporary effect. This is something that at 1 point in time, it will pass.

But what we are trying to convey is here is 2 things. how we are addressing this. We are addressing this, taking an agile approach in terms of adapting to our consumer needs but also taking as an opportunity to enhance, improve our structural capabilities. And this is also something that we are trying to really to show you over here how we are building a better and a more profitable company, bear in mind that right now the temporary macro factors are not helping our business.

We have one final question that is about CapEx expectations for next years. This is something that we will address on the next investor call presentation when we provide the full year guidance for 2026. But as we mentioned before. And also one of the things that we are trying to push as a structural -- and structural move in our strategy is to optimize the capital allocation to be efficient in terms of this CapEx, what we are seeing is that this is translating in a lower usage of CapEx.

But once more, not preventing to be investing in to have a better company to continue to be open units, to continue to be invested in digitalization and to continue to be improving our operational capabilities. Thank you for all these questions. I now think that with this, if there are not any more questions.

I can confirm, we have no further questions.

Good. Thank you. Thank you, operator. Thank you to all the participants in the conference call. See each other in the next quarter results, please feel free to contact the IR team if you have any follow-up questions. And we are -- we will be happy to see you in one of our restaurants in the near future. Thank you very much.

Thank you.

This does conclude the AmRest Q3 2025 Results Call. Thank you all for attending. You may now disconnect, and please enjoy the rest of your day.