Carmila Stock

Welcome to the Carmila First Half 2026 Results Presentation. [Operator Instructions]

Now I will hand the conference over to the speakers, Marie Cheval, Chair and CEO; Sebastien Vanhoove, Deputy CEO; and Pierre-Yves Thirion, CFO. Please go ahead.

Good morning, everyone, and welcome to our first half results presentation. Operational performance this semester continued to be very strong, both in terms of growth and profitability. As a consequence, we are in a position to upgrade the full year guidance and report an increase in the value of our portfolio. Today, I will start with the key takeaways, Sebastien will deep dive into our 3 growth engines and Pierre-Yves will take you through the financials.

Let me begin with the key messages. This was a very strong first half, but I want to be clear, it is not a one-off. It is a continuation of the track record we have built year-after-year. And behind is the same engine, our ability to transform our assets. First, we are upgrading our '26 guidance on the back of operational outperformance and our new acquisition.

Second, momentum was strong across our 3 growth engines, organic growth with net rental income up 1.4%, boosted by record tenant demand and by strong momentum in Spain. Investment growth with the immediately accretive acquisition of Grand Quetigny and innovation growth contributing EUR 14 million with our new retail media offering now being deployed. Third, asset transformation is driving excellent operational performance, record leasing activity, strong retailer sales and rising portfolio valuation.

Fourth, the strength of our balance sheet provides efficiency and opportunity with net debt at 7.3x EBITDA and an EPRA LTV of 49.3%. And fifth, we continue to create value for shareholders through disciplined capital allocation. We completed EUR 20 million of buybacks in the first half and EPRA NTA per share rose 3.3%. So in short, a very strong half, but above all, the continuation of a proven model powered by asset transformation.

These takeaways are grounded in strong operational and financial performance. We signed 530 leases. This is our highest ever volume of leasing activity with reversion of 2.8% above indexation and occupancy held at a high 96%. That fed directly into financial performance and EBITDA margin of 80.8%, up 80 basis points on last year and gross asset value up 2.6% like-for-like. Strong operations translating into strong returns.

As you know, our performance is powered by 3 engines: organic growth, net rental income up 1.4%, driven by strong retailer demand, asset transformation, and once again, 100 basis points above indexation. Investment growth. This half was marked by the acquisition of Grand Quetigny, adding 1% to recurring earnings on an annualized basis and innovation growth, EUR 13.7 million of recurring earnings, up 13% year-on-year with Retail Media now live and high demand for specialty leasing. 3 engines all firing.

Why do retailers choose our centers? Because shopping centers are winning share. They outperform overall consumption and that is because they convert. In a world where the cost of acquiring a customer online has more than doubled, a store is the most efficient channel. Add to that, genius scarcity. No new greenfield supply is being built and consumers, who are looking for experience and social interaction. That combination is exactly what our leading shopping centers offer.

We operate a European platform of 250 assets across France, Spain and Italy worth nearly EUR 7 billion. At its core are 80 leading shopping centers. They make up 80% of that total value and are the primary driver of our performance. Alongside them, a resilient network of 170 convenience centers anchors us in an everyday local life. I want to insist on these leading shopping centers. These 80 leading shopping centers are perfectly positioned to capture retail growth. They sit in the most dynamic region of our 3 countries, in attractive catchment areas with strong economic and demographic growth. They host around 70 top-tier brands. Occupancy is above 97%. And they are where we scale our innovations, Specialty Leasing, Retail Media and Next Tower. In short, we lead in the regions with the strongest growth, delivering highly scalable performance right across the portfolio. And this performance is not accidental. It is built through asset transformation.

How do we do that? Merchandising mix, 50 restructuring projects a year and reinforcing the customer experience. We consistently grow organic rental income above indexation. As the chart shows, we have done this year-after-year. And in the first half, again, 100 basis points ahead of inflation. The same transformation drivers lifted our portfolio value by 2.6%. The operational picture is strong across all 3 countries. Group footfall was up nearly 1% and retailer sales up 2.3%. The standout is Spain, where retailer sales rose 6.6% and the occupancy cost ratio remains healthy at around 11%, which means our tenants are profitable and there is room for further rental growth.

On investment growth, we acquired Grand Quetigny for EUR 45 million. It's a deal that ticks every box. First, it's a leading asset with strong fundamentals and a natural fit for our leading shopping centers portfolio. 4.2 million visitors a year, 66 stores and a dominant position in its local market. And second, we have identified exactly where the Carmila platform can add value through higher occupancy, reversion and asset transformation. The result is immediately accretive, adding 1% to recurring earnings.

On innovation, our third engine. This is where Retail Media stands out, and it rests on something advertisers truly value, data. We are unlocking Europe's deepest transactional data. We are pairing over 600 million annual visits with Carrefour first-party data and JCDecaux expertise. So we give advertisers something they can't find anywhere else, which is the ability to target precisely and to measure real impact all the way through to sales. That's exactly why our first clients, brands like Ferrero and Heineken are already advertising across our 900 new digital screens.

For Carmila, it's high value, high margin, and we expect Retail Media to contribute up to 2% of EBITDA. All this leads to our guidance upgrade. Organic outperformance and cost efficiency are expanding our EBITDA margin. Our net buyer strategy is accretive and innovation is accelerating. Together, that take our '26 recurring EPS guidance to EUR 1.87, up 3% on last year and above our initial guidance of EUR 1.84.

With that, I'll hand over to Sebastien to take you through the detail.

Thank you, Marie. Let me take you deeper into our 3 growth engines and the record leasing activity behind it. This was our busiest ever half year for leasing, 530 leases signed. That reflects real record demand from retailers with reversion up 2.8% and occupancy at 96%. And the default rate of 10.9% tells us tenants remain healthy and profitable. Just as important is the quality of demand. We are welcoming the leaders in the most dynamic categories that are health and beauty, sports, fashion, food, leisure and the fast-growing Asian wave concepts. When the best brand choose us, it's the clearest signal of how centers appeal. This demand is what lets us do what Carmila does best, transform our assets. Through restructuring projects, we drive incremental rental growth. In the first half, we approved 39 projects at a 9% yield on cost.

Let me now show you 3 examples that capture what we do. In Toulouse Labege, Zara floor space grew to 3x its original size, creating a 3,400 square meter flagship. The impact was immediate. Footfall up 7%, that's 130,000 additional visits versus last year. A stronger anchor makes the whole center stronger. In Rennes Cesson, we did something different. We turned an underused parking area into a 7,000 square meter leisure complex with Speed Park and Fort Boyard. The result, footfall up 22% with 50,000 new visitors in June alone. This is how we densify our existing footprint and create value from space we already own. And in Talavera in Spain, we opened a new Primark. Since it opened in mid-June, footfall is up 19% with 77,000 additional visitors. It has repositioned the center as a shopping destination for its region. 3 projects, one pattern. This is asset transformation in action. The right brands in the right places lifts the entire asset.

Beyond bricks and mortar, the customer experience is central to what we do. Customer experience is critical because it keeps people coming back, driving sustainable repeat footfall. And across our 620 million visits a year, that translates into stronger sales conversion. We enrich it constantly through events, for example, like Panini card trading during the World Cup, specialty leasing concept surfing the Asian wave and during the heat waves, turning our centers into cool, welcoming places to spend time.

Finally, on innovation, we are building recurring income streams beyond traditional leasing. Together, they contributed EUR 13.7 million in H1, up 13% year-on-year. Specialty Leasing leads at EUR 7.4 million, complemented by marketing services, Carmila Retail Development and the ramp-up of Retail Media. I would single out Next Tower. By monetizing 5G and Wi-Fi connectivity across our sites, we are turning our physical footprint into a new recurring revenue stream, already contributing EUR 1.8 million with substantial investment plan through 2030. It's a perfect example of how we extract fresh value from assets we already own. Taken together, high margin, low capital and a structural driver of our future growth.

With that, I'll pass to Pierre-Yves to turn this growth into earnings.

Hello, everyone. Marie and Sebastien have shown you the strengths of our top line growth. I will now show you how we convert it into earnings through cost discipline, a rising portfolio value and a strong balance sheet. Demonstrated ability to grow revenues with stable operating costs. This is the essence of our model. Net rental income rose to EUR 204 million, up 1.4% like-for-like. EBITDA reached EUR 178 million, up 1.9% like-for-like, growing faster than rental income. That operating leverage lifted our EBITDA margin by 80 basis points to 80.8% and took recurring EPS to EUR 0.97, up 3.5%.

Beyond operating leverage, we have 2 additional levers to optimize our cost base, AI and ESG. The first is technology. AI has enabled us to build the suite of tools that deliver tangible efficiency gains. AI-driven building management system to optimize energy consumption in real time. A new data lake centralizes our operation to unlock further savings. And by automating high-impact workflows, our AI agents are delivering a return on investment above 20%. The second is ESG. Our decarbonization strategy lowers energy cost structurally through lower consumption renewable energy usage, while keeping us on track for net zero by 2030 with emissions already down 78% versus 2019. Together, these 2 levers reduced our cost base and directly supports profitability.

On Slide 26, our portfolio appraisal value continued to rise. They were up 2.6% like-for-like to EUR 6.8 billion. That is EUR 170 million increase since December '25. Growth was broad-based, led by France up 2.9%. This growth is underpinned by rental growth, green certifications, scarcity value and above all, the transformation of our assets, which accounts for more than half of the value increase. This is value we are actively creating, not just market movements.

We believe these valuations make a turning point. On the left, you can see that net initial yields have started to compress down 12 basis points since 2024. On the right, we detail the main drivers behind the increase in our portfolio value. Out of the EUR 170 million like-for-like increase in gross asset value, EUR 60 million came from rental income growth. Around EUR 100 million came from asset transformation. This is nearly 60% of the increase. And EUR 12 million came from the strong momentum of yields in Spain. In short, our valuation growth is driven by operational performance not sentiment.

On Slide 28, our debt structure is a real competitive advantage. We have a well-spread maturity profile with no major refinancing needs before '27. Our cost of debt is fixed and low at 3% and expected at just 3.15% next year. In a higher environment rate, this visibility gives us the firepower to keep investing in growth.

On Slide 29, rising values and controlled debt reduced our leverage further. Net debt was broadly stable. This increase simply reflects our buybacks, while gross asset value continued to grow. As a result, EPRA LTV improved by 40 basis points to 39.3%. Here is the balance sheet at a glance. Leverage at 7.3x, maturity at 4.2 years. This is reflected in our earnings, BBB stable from S&P and Fitch and BBB+ from Fitch on senior unsecured debt, efficient and ready for opportunity.

On Slide 31, our value creation flows through net asset value per share. EPRA NTA rose 3.3% year-on-year to EUR 26.75 with NAV and NDV up similarly, consistent growth value per share.

On Slide 32, put together, this is an attractive well-positioned return profile, cash flow growth, an NTA revaluation of 3.3%, high earnings visibility above 96% occupancy and a strong balance sheet. I would draw particular attention to shares liquidity where we have made a real step change. Average daily number in our shares doubled in the year at EUR 3 million and has now tripled since 2019. This deeper liquidity opens the stock to a whole new pool of institutional investors who applied strict liquidity thresholds, broadening our shareholder base.

On Slide 33, this bridge shows how this strong first half performance flows through to an upgraded guidance. From EUR 1.81 last year, we initially guided to EUR 1.84. Now our strong H1 operational performance and the acquisition of Grand Quetigny, already accretive, take us to EUR 1.87 for a total EPS growth of 3.3%.

I will hand back to Marie.

Thank you, Pierre-Yves. It has been a great first half of the year, and there is more to come. We will host a Capital Markets Day on November 19 to announce our new strategic plan to 2030. 5 key topics: our leading shopping centers portfolio, our asset transformation engine, growing revenues through innovation, balance sheet strength and sustainable earnings growth. We look forward to seeing you in person.

This concludes the presentation. We will now be happy to take your questions.

[Operator Instructions] The next question comes from Aakanksha Anand from Citigroup.

I have 2 questions, and I'll go through them one by one. The first one is on the like-for-like portfolio value change. So it was 2.6% for the portfolio overall and 2.9% in France, which is actually higher than what your other European shopping center peers have reported. Is it reasonable for us to expect these trends to be more sticky in the future? As in, is that something that you expect to be outperforming going forward from here? And along with that, if you could also provide some color on the investment markets and the opportunities that you see for future accretive acquisitions? That's the first one.

Thank you for your question. As Pierre-Yves explained, the increase in the portfolio creation is driven by 2 main pillars. First, the robust rent growth; and second, the asset transformation. And importantly, appraiser did not change our methodology. We think that there are more to come on asset transformation. As you know, we have an objective of around 50 projects of transformation per year. We did 39 of them in the first half. So there are more to come. I think it's really the rollout of a very strong strategy of transforming our assets. As Pierre mentioned, 3 good examples in the first semester, the Zara in Labege, the Speed Park and Fort Boyard Park in Rennes Cesson and the Primark in Talavera, and there is more to come. So we are confident on our ability to continue to grow, to create value on our portfolio.

On the acquisition, as you noticed, so we acquired Grand Quetigny. We have reached 50% of our objective of EUR 100 million of acquisition this year in the first half, meaning that we are on track. We have a pipeline of projects. And we are confident in our capacity to reach our targets depending, of course, this is subject to market conditions. So we will keep you posted on this important part of our strategy. And just to concept, we are clearly targeting -- sorry.

No, you go on. I'm sorry.

No, just on acquisition, we -- our focus is on our 3 core markets. And clearly, we are targeting leading shopping centers when we can secure yields of at least 100 to 150 basis points above capitalization rates. That's what we are looking for.

That's very clear. The second question is on Spain actually because there seems to be a pretty strong momentum in that market. Could you just help us understand what's happening there? The 7% increase in retailer sales, obviously, is much higher than what France and Italy have performed? And is Spain kind of -- because of the attractiveness of the country, is that something that might become a bigger part of your portfolio going from here?

Thank you for your question. As you mentioned, the growth in sales in Spain is quite amazing, 6.6%. I think it reflects, first, the quality of our portfolio. And second, the fact that economy in Spain is booming more than in France and even Italy. So we are benefiting from this trend. Especially tourism is very high in Spain, and we are very well located in Spain on touristic area. And we think that there is more still to come in Spain, and we are ready to catch all the good impact on the Spanish economy. As I mentioned previously, we are in an acquisition mode in France, Spain and Italy. We are looking for assets to acquire in Spain. Spain is a very competitive market. So it's -- we need to find the right opportunity.

The next question comes from Florent Laroche-Joubert from ODDO BHF.

I would have maybe 1 or 2 questions, and I can ask one by one. The first one maybe is on the guidance on Slide 33. So actually, so we understand that in your guidance, you have maybe taken into account the impact of your acquisition in Dijon. But so should we expect maybe also some disposal to be taken into account in 2026 or maybe you are more to look for disposals in 2027?

Thank you, Florent, for this question. So yes, we have uplifted the guidance from EUR 1.84 to EUR 1.87. Part of it comes from Quetigny acquisition, around EUR 0.01 and EUR 0.02 come from operational performance which is very strong with the improvement of the EBITDA margin. Regarding the impact of potential disposal, we have already done around EUR 15 million disposal of this year and the objective -- the yearly objective is around EUR 50 million. So we are working on it. We have the capacity to do it as we have done it and we have disposed of more than 6% of the total portfolio in the last 3 years. That's really good condition. That won't impact the guidance for '26 as we are already starting the second semester. So the impact of potential guidance will be -- won't impact the guidance for '26.

Okay. And maybe my second question would be on your acquisition in Dijon. So you expect that it will be accretive by plus 1% on net earnings on an annual basis. So shall we consider this as a first conservative estimate? Or do you already include maybe some results regarding the transformation of the asset and upgrade of the operational performance?

Thank you for this question. So the 1% is the immediate accretive impact. As we have said, we are well above our target objective of 150 basis points above the cap rate for the net acquisition yield. On top of that, as Marie said, this center is really the kind of center that we are looking for, a leading shopping center. We have capacity to optimize the mix merchandising. We have the capacity to make restructuring and to optimize the customer journey. So on top of that, there will be additional value creation.

Okay. And maybe my last question. So in terms of -- you have spoken about implementation of cost efficiency, notably thanks to artificial intelligence. So shall we expect any further improvement in the future in terms of cost efficiency?

Yes. So artificial intelligence is starting to be really concrete within Carmila. It's not just a concept, but we are starting to develop really interesting solutions. By the way of example, we are currently developing an agent dedicated, for example, to automated reconciliations for cash resets with outstanding invoices. This is really important for us as we have more than 6,000 tenants, so many invoices. And it helps a lot the team to optimize the process and to be more efficient. So we have a good returns on it. As you have seen last year, we have improved the margin. We are continuing this semester with an improvement of 80 basis points, and there is more to come with efficiency around artificial intelligence solution deployments.

The next question comes from Benjamin Legrand from Kepler Cheuvreux.

I've got a few questions. I will go through them one by one. But the first one maybe is on the guidance. Just quickly, do we agree that there is no additional acquisitions or disposals in the guidance, meaning that if there is anything happening soon that could be impacting the guidance again?

Yes. There is no additional impact. But as I said, we are entering in the second semester. So there won't be big changes due to perimeter impact to the guidance. So we are comfortable with that guidance and we will deliver on that guidance.

Okay, okay. Maybe regarding the Specialty Leasing and pop-up stores, sorry, they're up more than 8% year-on-year. So it's quite a good performance. I was just wondering how come do you drive such a good performances in this area? And should we expect more to come in the second part of 2026 and in 2027?

I think on Specialty Leasing, it's a good example of the power of the Carmila platform. We have people on the ground, we have a great network, and we have very efficient tools. If you remember, we launched ClickStand, AI-powered tool in order to be more efficient. We have very good streamlined process because we have many leases on Specialty Leasing. So we need to be very efficient. And I think we can innovate to propose our tenants with new concept and be able to deploy it very quickly. So clearly, it's a very good example of the power of Carmila platform. We think that there is still to come. And probably, in the coming years, a double-digit growth in this pattern in the Specialty Leasing.

Okay, clear. Maybe on Italy because you didn't really mention anything this time. I know it's not your main geography, but it seems that the figures are a bit softer this time. Obviously, it's related to the change in operator, but I'm just wondering if you could add a bit more color on the margin and what you're expecting for 2027 with the new operator? Are you looking for growth? Or yes, are you trying to reduce the exposure basically?

Yes. Thank you for this question on Italy. As you mentioned, there is a new operator for Italy. We have 8 shopping centers, 7 of them are incurred with new [ princess ], a new operator, is currently transitioning and rolling out new concepts. It can explain why the footfall is slightly down, but retailer sales actually grew by 1%. So this proves the robust strength of our tenant mix. We are very pleased with our current portfolio. We consider our platform in Italy that the platform is a significant opportunity, and we are clearly in a net buyer position in Italy as in Spain and in France. And we would love to expand if we find the right opportunity.

Okay. If I may, just the last question. You seem to emphasize your 80% of leading shopping centers and then 20% is a bit of the rest. Should we understand that those 20% at your Capital Market Day, maybe you're going to try to get rid of those 20% or transform it? What's really the plan for those 20%? Or should we just wait for the Capital Market Day?

We hope to see you at the Capital Market Day, for sure. Clearly, those 20%, first, they are not low quality. They are not bad and we like them. It's a network of convenience centers, checkout gallery, providing daily essentials, and clearly, it's valuable and very resilient segment. So it's not a problem to be solved. That said, clearly, our direction of travel is clear. Over the plan, we are steering the portfolio towards more leading shopping centers through acquisition and disposal. We want to buy leading centers like Grand Quetigny. And we are a selective seller of non-core assets like we did with Villers-Semeuse. And the idea is to recycling that capital either on the exact phase, the quantum, the buyer universe. We will explain that at our Capital Markets Day on the 19th of November.

[Operator Instructions] The next question comes from Alex Kolsteren from Van Lanschot Kempen.

2 questions from my end. First one, so there's been a number of wildfires in essentially all of your countries you're present in. Have any of your assets been affected by this? And do you see a change in consumer behavior? And secondly, so the EPRA vacancy rate you report now excludes the strategic vacancies. Why did you decide to change your metric here? And what would the number be if you do consider the strategic vacancies?

Yes. On the fire, first of all, we want to demonstrate our support to the people concerned by the fire. No Carmila shopping center is exposed to this area. And as you know, our portfolio is very well spread. I think it's in terms of risk management, it's a kind of comfort. On your second question.

On your second question about the EPRA vacancy rate, we are just aligning with the market. So publishing the EPRA vacancy rate as everybody is calculating it. So the result is 96% of financial occupancy and 4% of vacancy. The impact of strategic vacancy is pretty stable. It allows us to develop restructuring projects such as Zara in Labege, Primark in Talavera. So it creates value. But the idea was to align with the market practices, and that's why we decided to publish the EPRA vacancy as are doing our peers.

Okay. But let's say, you would have provided the number as you did previously, what would it have been?

Yes, we can. Of course, there's no problem with the strategic vacancy. It creates value. So it's around 1.8%, and it's pretty stable and has always been very stable over the semesters.

Okay. All right. So the EPRA occupancy rates are roughly 94% then in H1?

No, no, EPRA vacancy rate is 96%. That's how it's calculated. That's how our peers are calculating it. So that's why we decided to align with the peers and the EPRA vacancy rate is 96%.

We have a few questions on the chat. The first one is about the acquisitions. Do we target centers attached to Carrefour? Or can we look at other hypermarket operators -- centers attached to other hypermarket operators?

Yes, we can buy the kind of assets we would like. So no problem to buy an asset anchored by another operator. As you know now, Carrefour is anchored mainly with Carrefour hypermarket, and we are very happy with that. But we have in Italy 8 shopping centers without the Carrefour hypermarket, and in France now 2 centers without the Carrefour hypermarket. So clearly, our acquisition policy is clear. We want to acquire shopping center in which we can create value. And if it's anchored by a Carrefour hypermarket, it's very good. If it's anchored by another hypermarket, it's good also.

And the second question on the chat is about the share buyback program. Do we plan to launch a new share buyback program?

So on the share buybacks, we have already done EUR 20 million during the first semester. Last year, the total was EUR 30 million. We are currently happy with the EUR 20 million. We haven't decided to launch a new program for the third quarter, but we will keep you updated for the fourth quarter.

And then the question about the heat wave impact on visitors' numbers and retailers' revenues.

So clearly, in June, especially in France, heat wave has a positive impact on the footfall, not major, but a positive impact. I think everybody realized that when it's rain, when it's cold and when it's very hot, the shopping center provide a comfort for the visit, which is very appreciated by the clients. And we try to be very in touch with local authorities during the heat wave. For instance, some schools came into our center to do the class, especially in Montesson Paris. So I think it demonstrates that we are a place that gives comfort and that we are very anchored in the local authority in order to be part of the social link, which is very important for us.

And then last question, where will the Capital Markets Day be hosted?

Well, thank you for this question. We will host it in Paris because we think it's more convenient for a lot of people. And we will organize after this CMD visits in our shopping center, especially in [indiscernible] in Rennes in order to see the new leisure complex in our Rennes Cesson shopping center.

I think there is no other questions. So I thank you for your attention. Have a nice day, and have a nice summer. Thank you very much.

Good morning, everyone, and welcome to Carmila's '25 results presentation. This has been another year of profitable growth, reflecting the strength of our strategy and high-quality execution. Let's begin with the key highlights of the year. We will then explore the drivers behind it, revenue growth powered by 3 growth engines and disciplined cost management, which convert growth into earnings. Finally, the outlook for '26.

First, the key takeaways from '25, a year of profitable growth. We have strong momentum across all 3 growth engines. First, organic growth reached 3.5%, once again outperforming indexation, thanks to strong retailer demand, dynamic leasing activity and value creative agile projects. Second, investment growth, which added over 5% to net rental income, thanks to the full year impact of the Galimmo acquisition. And third, innovation growth, which is now firmly established as a third growth pillar, generating EUR 27 million of EBITDA. This strong top line momentum, combined with cost discipline translated into higher profitability. The EBITDA margin rose to 79.3%, and we grew earnings by 9%, taking EPS to EUR 1.81. The balance sheet is strong, striking the right balance between efficiency and opportunity with an LTV of 38.8%. And we are proud to continue to return capital to shareholders. We have increased the dividend by 9%. And today, we are announcing a new EUR 10 million share buyback. Looking ahead, we expect another year of profitable growth in '26. The guidance for next year is EUR 1.84, an increase of 2%. Slide 5 shows the positive momentum across the board. This is clearly reflected in the key operational indicators nearly 900 leases signed, high occupancy at 96% and positive reversion of 3.8%, well above indexation. This directly translated into revenue growth with net rental income up 8.8% to EUR 403 million. This is also reflected in the valuation of our portfolio, which rose by 1.3% in to EUR 6.7 billion. Our 250 shopping centers welcome 620 million visitors last year, showing that they are essential relevant and close to the people they serve. As I said, the strong performance in '25 was driven by sustained momentum across our 3 growth engines.

Let me pause here and explain how we think about growth at Carmila. First, organic growth. This is the core of our business. It is driven by our leasing activity, indexation, tenant mix upgrades and improvements we make to assets, what we call agile projects. Second, investment growth. It reflects our active portfolio management. It includes acquisitions, disposals and major projects, allowing us to upgrade our portfolio and deploy capital in the most value-accretive opportunities. Third, innovation. We've built recurring income streams that go beyond traditional rents such as specialty leasing, retail media, marketing services, Next Tower and our brands incubator. These activities leverage our footprint, data and footfall to create additional sources of value. Together, these 3 engines generate sustainable growth and outperformance. And growth is only the third step. Disciplined cost management permits us to convert growth into earnings, as shown on Slide 7.

In '25, we delivered strong growth while keeping operating cost control demonstrating our ability to scale without increasing our cost base. Notably, the integration of Galimmo generated EUR 5 million of cost synergies. Overall, our EBITDA margin has been improved and financing costs remain low and stable at 3%. As a result, EPS increased by 9% to EUR 1.8 exceeding our initial guidance. Indeed, our balance sheet is a key strength with we maintain an optimal balance between efficiency and opportunity. We are committed to return capital to shareholders. Therefore, we have increased the dividend by 9% to EUR 1.36 and bought back EUR 30 million of share last year.

Now turning to Slide 9. We confirm our net buyer strategy designed to deliver both immediate accretion and long-term growth. We target EUR 100 million of acquisition per year focusing on opportunities that offer 100 basis points of value creation above market cap rates. This is balanced by EUR 50 million in annual disposal as part of our active portfolio rotation. '25 once again illustrates the effectiveness of this approach with, first, the successful integration of Galimmo; and second, EUR 69 million in disposals completed at book value with a net initial yield of 6.6%. The objective remains to be a net buyer. Market valuations are attractive and the Carmila platform is built to integrate assets quickly and create value efficiently. Looking now ahead to '26. We expect growth momentum to continue with EPS rising 2% to EUR 1.84. This will be led by organic growth despite negative indexation in France and supported by cost control.

Now let me set the economic context and explain why Carmila is well positioned to capture retail growth. Looking ahead on Slide 12, the outlook for retail property and for our portfolio is positive. The micro environment is supported with easing inflation and rising real wages, driving higher consumer spending. At the same time, e-commerce growth is slowing as online penetration matures. Omnichannel is the winning model as brands increasingly integrate in-store strategies and online strategies. Now let me explain what makes Carmila's model distinctive and why it drives consistent performance. Carmila shopping centers are local life hubs. First, there are essentials in people's everyday life as they are Carrefour hypermarket anchored, meet daily needs and generate frequent recurring visits. Second, they are relevant to people. We have integrated health care, services, dining, sports and leisure, making them places people rely on to meet, spend time and experience daily life.

Our centers attract more than 600 million visitors per year with footfall steadily increasing. Third, they are close to people, strategically located at the heart of local life. One in 3 people in France and Spain lives within 20 minutes of a Carmila center. And this is a powerful combination and brands recognize it as reflected in the strong leasing activity and rental growth across the portfolio. And we don't just capture retail growth. We exceeded. As you can see on the Slide 14, we have outperformed the indexation every single year. In '25, organic NRI growth exceeded indexation by 110 basis points. This consistent outperformance is structural driven by our life positioning and the scale of our footprint, which creates strong network effects. This is how our model is built to deliver upside across the cycle year after year. I will now hand over the floor to Sebastien, Carmila's Deputy CEO.

Thank you, Marie. Hello, everyone. Let's now take a closer look at our performance, starting with our other 3 growth engines, all showing strong momentum. First, organic growth. We are a strategic partner for brands, signing almost 900 leases. This reflects the arrival of new brands such as Aroma-Zone and Legami, and the continued expansion of existing tenants across our network, supported by very strong retention levels. This strong demand translated into excellent operating metrics with reversion of plus 3.8%, an effort rate of 10.9% and occupancy rate at 96.5%. Our centers are essentially full. And what is striking is that this demand is not just broad. It's deepening.

Let me show you what I mean. The chart on Slide 17 shows our network effect in motion. More and more retailers, both existing tenants and new brands are choosing to expand across multiple Carmila centers rather than opening a single location. This network effect is a key driver of our growth. Brands such as Rituals or Jack & Jones use Carmila as a platform to accelerate their European expansion, leveraging our dense footprint to scale faster. What we are seeing is a powerful virtuous circle. Next slide shows strong retail demand on one side and strong customer engagement on the other. This is a tangible result of our model because our centers are true partners in people's daily life. These structural strengths continue to translate into rising footfall, up 1% and improving retail sales particularly in Spain, where it increase by 5%. We now have 250 shopping centers across 3 countries, as shown on Slide 19. France, our most major market is resilient with 167 centers delivering solid NRI growth. Spain is a high-growth market with 75 centers benefiting from strong indexation and leasing momentum, driving our strongest NRI growth.

In Italy, we now have a new opportunity alongside a new partner complementing our long-standing and successful partnership with Carrefour. Together, this diversified footprint supports sustainable growth across cycles. Next slide showcase some of our recent agile projects, a key driver of our organic growth and value creation. They reflect our strategy to enhance performance by making our existing assets perform better. Each year, we deliver around 50 agile projects generating an average yield and cost of 10%. So this strategy directly improved the customer experience while delivering attractive returns for us. Let's take a closer look at Vitrolles in Marseille, one of Carmila flagship in France. Over the last 2 years, we transformed the site. Beyond the full renovation, we expand in the pharmacy and we repurposed 2 units to welcome [indiscernible] in 2024. Last year, we further boosted its appeal by adding a new food park in the car park area. And looking ahead to '27, we will open a brand-new leisure unit right next to it. The results are clear. Asset value is already up 5% year-on-year and quarterly footfall has surged by 15% in the food park delivery. This is a perfect example of Carmila's asset management expertise, translating directly into immediate rental uplift and accretive return on investment.

Now let's turn to our second growth engine, investment growth and specifically the incremental value creation within the Galimmo portfolio. Galimmo is a perfect example to illustrate Carmila's capital allocation strategy. This acquisition was very accretive from year 1, delivering a return of over 40%. Furthermore, there is embedded growth still to come. First, occupancy. We have successfully reenergized the portfolio, moving from 93% at acquisition to 94% today. Second, on the collection rate. Our management processes are delivering immediate results. We have already exceeded our target, hitting over 98%, which brings Galimmo with our standards. While Galimmo drove investment growth in '25, we are also laying the groundwork for Carmila's long-term evolution through mixed use and major projects. From '27, we plan to deploy EUR 50 million a year in CapEx on major projects, aiming for a yield on cost of at least 150 basis points above asset cap rate. In mixed use, we now have 15 projects underway compared to [ no one ] in '19. We are demonstrating a clear commitment to transforming our centers into true living areas, notably our strategic partnership with Carrefour. This momentum is fueled by 2 powerful tailwinds, regulatory change creating land scarcity and increasing urbanization.

Together, they are crystallizing the value of our portfolio, ensuring dominant positioning for the long term. Now turning to our third growth engine. Innovation is now firmly established as our third growth pillar, contributing EUR 27 million of EBITDA in '25. This is now a significant contribution within Carmila's earning delivering double-digit growth in '25. Here, we are building recurring income streams with high margins and low capital intensity. They complement our core retail business and further improve the value of our assets. On Slide 25, I would like to dive into 2 initiatives where we have been very innovative. First, specialty leasing. We have co-developed a tech platform where retailers can instantly book short-term retail location within Carmila centers and with transparent pricing and maximum flexibility. They can gain fast, low-risk access to our locations. The platform is called ClickStand, and you can think of it as the Airbnb of retail. For Carmila, it is the digital leap that monetize footfall and increases asset productivity. We have already deployed this solution across half of our portfolio. Now on Retail Media. We are the cutting edge on this new trend in order to create the most powerful network in France and Spain. This alliance is built on a clear sharing of expertise. JCDecaux, the world leader, bring its technological expertise. Unlimitail acts as a media agency to manage the transactional data provided by Carrefour. And Carmila provides a premium physical setting offering a complete and measurable customer journey from the parking lot to the hypermarket shelf.

This is a game changer as advertisers will be able to link massive physical footfall with rail purchase data. By summer '26, we will have deployed the ecosystem. It is set to generate from 1% to 2% of Carmila's EBITDA growth starting in '26 with very limited contribution of CapEx which is below EUR 8 million. We are not leasing a wall or a screen. We are selling a qualified mensurable audience at the exact moment of the purchase decision. I will now hand over the floor to Pierre-Yves, Carmila's CFO.

Hello, everyone. Marie and Sebastien just highlighted our strong revenue growth. I will now show you how we successfully translated this growth into earnings through disciplined cost management and operational excellence. Now on Slide 27. Growing net rental income with stable operating costs. This is exactly what our model delivers. As shown on the left, revenues have grown steadily driven by the combination of organic growth, investments and innovation growth, reaching over EUR 403 million in '25, representing 9% growth. What makes this performance particularly stronger is that it was achieved with stable operating costs.

As shown on the right, overheads as a percentage of NRI have declined to 15.3% in '25. This operating leverage is the core strength of our model allowing us to convert revenue growth into higher earnings and sustainable value creation. We control energy costs to support growth. We are very proud to be on track to achieve net 0 emissions by 2030 and ESG commitment that makes both environmental and economic sense. By reducing energy consumption, we structurally lower operating costs. This creates tangible savings today, protects our business from future energy price volatility and makes our centers more attractive and cost efficient for our tenants. In short, decarbonization is an investment that strengthens resilience and long-term profitability. To turn our performance into long-term shareholder value. We know it must be supported by the right financial structure, we balance efficiency and opportunity.

As you can see, our average cost of debt stands at 3%. Thanks to our hedging strategy, this cost is expected to remain stable through '26. In terms of liquidity, our structure is built for the long term. We have a well-spread maturity profile with no refinancing needs before '27. In a market where many players are facing higher refinancing hurdles. This stability is a massive competitive advantage. It provides Carmila with the visibility and the financial firepower needed to continue allocating capital towards growth, asset optimization and sustainable value creation. Now on Slide 30. Our disciplined cost management has translated into margin expansion and earnings growth. Our EBITDA margin has increased steadily over the years and now stands at 79.3%, benefiting from efficiency gains including the rollout of AI-driven automation across our operating ecosystem. This margin expansion has naturally fed into earning growth.

Strong top line growth combined with rigorous cost control, allow us to convert growth into earnings. This is the essence of our model. Our operating model also reinforces the fundamental value of our underlying assets. On Slide 32, you can see that our portfolio valuation is rising. In '25, it increased by 1.3% on a like-for-like basis, reflecting the strength and appeal of our assets. Valuation increase in France and more strongly in Spain. We think this is a part of a broader market trend, high-quality retail assets with strong fundamentals are regaining value. Our portfolio valuation increased, thanks to several structural drivers. Rental growth, powered by our strong leasing activity, asset quality with 100% of our assets now green certified, scarcity value has regulatory changes and limited new supply reinforce the value of our existing assets, a supportive transaction market, validating our pricing through renewed investor interests.

And finally, lower discount rates reflecting our improved risk profile and strong cash flow visibility. Together, these factors confirm that Carmila portfolio is ideally positioned to capture value in the retail real estate markets. Portfolio valuations are clearly recovering. Yet the market still offers an attractive entry points. As shown on the left, net initial yields have just started to compress. It reflects improving investor confidence and the stronger fundamental I've just described. At the same time, rents continue to rise, supported by our strong leasing momentum. This combination proves that our valuations are driven by real operational performance and not just market sentiment. This gives us a huge confidence in the upside potential of our assets. It also validates our strategy to continue acquiring high-quality properties in a disciplined and accretive way. Here is a snapshot of our balance sheet. Our financial structure remains very solid, reflecting the right balance between efficiency and opportunity. At the end of '25, net debt stood at 7.3x EBITDA and LTV at a comfortable 38.8%. Our financial profile was further strengthened by Fitch new rating with a BBB+ on senior unsecured debt, confirming our attractive access to funding.

Our financial strategy aims to strike the right balance between a low cost of capital and the capacity to invest in growth. We benefit from low-cost funding through disciplined capital recycling, with disposals at 6.6% yield and a strong access to the bond market illustrated by our 3.75% bond issuance, 8x oversubscribed. This enables us to invest at attractive returns through accretive acquisitions, major projects and share buybacks while maintaining a disciplined financial profile with an LTV around 40%. Our balance sheet is a strategic tool to accelerate growth and maximize value creation. This financial discipline and our investment capacity translate directly into value creation for our shareholders. As you can see, our NTA increased by 1.5% year-on-year to reach EUR 26.52 per share.

Now on Slide 37, let me explain the drivers behind our '26 guidance of plus 2% EPS growth. Organic growth is expected to be solid with NRI growing around 100 basis points above indexation, supported by strong leasing momentum and positive reversion. Innovation contribution in earnings should deliver high single-digit growth as specialty leasing, retail media and services continue to scale. Investments will have a temporary negative impact of minus 1% from '25 disposals which will mechanically weigh on NRI in '26. Taking all these factors together, we expect EPS growth of 2% in which corresponds to a 3% like-for-like. Importantly, this guidance excludes any potential upside from acquisition. We want to remit net buyers. We see significant opportunities in the current markets where asset valuations are attractive and our platform benefit from strong networks and scale effects, enabling us to integrate assets rapidly and unlock value efficiency. I will now let Marie conclude this presentation before entering the Q&A session.

Thank you, Pierre-Yves. Some final comments on shareholder returns and the outlook for 26. We are deeply committed to delivering attractive and sustainable returns to shareholders. To illustrate this, our dividend increased by 9% in '25 and has grown steadily every year since '21. We continued our share buyback program with EUR 30 million executed in '25, and we are launching a new EUR 10 million program today. At the same time, we reinforced intrinsic value with NTA per share up 1.5% in '25 and a 3.5% CAGR this decade. In other words, we combine immediate shareholder returns with long-term creation value.

To conclude, let me repeat our expectations for '26. We expect more of the same as the positive fundamentals that drove our performance in '25 remain firmly in place. Positive growth momentum will continue and is expected to translate into EPS growth of 2% in '26, reaching EUR 1.84 with more potential upside from acquisition, as Pierre mentioned.

Before moving on to the Q&A, I would like to thank all Carmila teams for their outstanding contribution to this '25 performance and for the growth momentum we are building for the years ahead.

[Operator Instructions]

The next question comes from Florent Laroche-Joubert from Auto BHF.

So thank you very much for this presentation. I would have maybe 2 or 3 questions, if I may. Maybe I can ask all my questions and you can answer. Maybe the first question on your acquisition pipeline. So how confident are you to reach this objective and how the competition is for you on this M&A market? So then maybe question -- that second question, which is linked on the guidance. So we understand that your future acquisition are excluded of your guidance. So meaning that if you do some acquisition and maybe EUR 100 million, so we have to take this into account maybe in -- for your recurring EPS for 2026. And my third question would be on -- with new from innovation initiatives. So could you give us maybe more color on any room for more growth on that?

Okay. Thank you very much, Florent, for your questions. On acquisition, clearly, we are a net buyer. I think we have a strong track record on the asset rotation. We do see good opportunities in the market. We like the price of these assets. And we think that we can add a lot of value to the assets with our cost efficiency and leasing and to use our platform and network effect. We currently are examining some opportunities. We will buy grocery anchor centers in our core markets. Of course, it's always difficult to be precise on amount and timing of this transaction, but we are confident to have this acquisition. Our objective is EUR 100 million of acquisitions this year, and we will update you as soon as we can.

On the guidance, as you have understood, our current guidance is made of organic growth, which is -- and the drivers are 100 basis points of value creation of NRI above indexation. So this is what we know how to do at Carmila. We do it year after year, and we will continue to do it in '26 and after 100 basis points above indexation. Then EBITDA margin improvements. We have worked a lot this year in EBITDA margin improvement, and we believe that there is more to come in the coming years. So the current guidance of plus 2% is made of a 3% impact on like-for-like as there were disposal last year of 1% of the portfolio. So you are right.

We are confident about making acquisitions and it will drive higher earnings in '26. So depending on when we do those acquisitions, their contribution will be higher in '26. So yes, you can plug some acquisitions in your money.

On innovation, clearly, innovation is now firmly established as a third pillar of growth for Carmila. These activities will go beyond the traditional activity of Carmila, I mean rents. And we try to monetize our footfall, our data, our network and our size. And those activities clearly are characterized by high margins and low capital intensity. So Sebastien mentioned specialty leasing and our innovation ClickStand. Retail media for us is really a growth driver thanks to our partnership with Carrefour, Unlimital and Jean-Charles Decaux. I think we really go beyond the simple fact to sell screen. What we sell is really a capacity for retailers to reach consumers in all their customer journey.

So it's very important for us, and it will contribute to 1% and 2% to the growth of EBITDA in the coming year. And we will be one of the major player of retail media in France, in shopping centers. Two other comments on innovation. Next Tower, you know that because we launched that in the former strategic plan. Next Tower is developing. Clearly, it has generated EUR 3.5 million of earnings in '25, thanks to the partnership we have with Carrefour. And another innovation is Carmila Retail Development, the concept incubator. We have 7 minority stakes in promising retailers and the goal for this year is to try to sell Cigusto, which is a major player in e-cigarettes and that is now have more than 200 stores. So this is a few examples of innovation, which is at the core now of the Carmila strategy, and we try to find new ideas each year in order to reinforce growth.

The next question comes from Aakanksha Anand from Citigroup.

Three questions from my side. I can take them one by one. The first one is just on the indexation outperformance, that clearly seems to be on an upward trend. I just wanted to understand that do you see a pathway growth to the 2017 levels of indexation outperformance, which was closer to 2%? Or do you think those days are actually behind us and the 100 bps outperformance is the new normal?

Okay. First, on indexation. So impact for '26 to start with that point. It will be a lower impact in '26 than in '25, but we have demonstrated our capacity to create value in all kind of market indexation, so we will continue to do so in '26. Then '27 and after, we don't have the crystal ball, but what are saying the model is that it will be between 1.5% gradually to 2%. So we believe that we can come back to those level of indexation. But of course, this is a market data and not specific to Carmila, but we have the ability to work in high indexation environment and lower indexation environment.

Understood. The second question is on the vacancy. So vacancy seems to keep inching higher. I mean it's not significant numbers, but it was around 5.1% in '23, 5.3% in 2024, and now it's 5.7%. And is this -- so what are the drivers kind of behind this?

So about financial occupancy. Our financial occupancy is up by 30 basis points and we believe that the most accurate indicator is the financial occupancy to measure the current performance. That's true that there is a slight decrease of minus 30 bps in the EPRA occupancy, but this is driven by strategic vacancy which rose this year from 1.5% to 2%. And this strategic occupancy allows us to proactively do restructuring and through our agile projects. So this is something that we proactively manage. And that's why we believe financial occupancy is the best indicator of plus 30 bps. In short, we want to trade passive occupancy with strategic positioning for assets. And behind those numbers, what we can see is that the physical occupancy is following the same trend that the financial occupancy.

Got it. The third question on acquisitions. Just pushing a little bit further to the answers given for the previous questions on acquisition as well. So the positions that you see on the horizon, can we expect like a similar level of accretion as we saw from Galimmo?Or do you think it might be slightly lower than that? And is there a geographical preference that you have for acquisitions? I mean, Spain seems to have pretty good momentum.

So on the accretion from acquisitions, so the idea that we have is to dispose of assets at 6.5% and to reinvest the fund in accretive acquisition. So Galimmo was the perfect acquisition. I mean, with the yield of 9.5% strategic fit with Carmila, so not easy to replicate, but there are some opportunities on the market. with potential of spread between the acquisition price and the value. And on top of that, we believe that we can create additional value with asset management. So the focus is clearly to have a spread between the acquisition and the valuation. And let's say, we target spread of more than 100 or 150 basis points to give you an idea of the value creation.

The next question comes from Alex Kolsteren from Van Lanschot Kempen.

A couple of questions at this point. I'll go by them one by one. First, the Q4 reletting spread increased quite a bit. What drove that?

So what we are saying about quarterly performance, we think that the most accurate is the annual view. It's 3.8% this year, it was 3% last year, so it's increasing. That's going in the good way. Then quarter after quarter, you can have 1 or 2 negotiations, which are pushing the reversion or weighing on the reversion. So I think the good focus is the annual view and it's 3.8% and accelerating this year.

Then on the Carmila Retail Media deal, I appreciate that you provide the numbers. That 1% to 2% EBITDA contribution, is that net of any cost?

Yes, it's the net contribution. It's the value creation from the retail media initiatives. So it's net of any cost. It will go directly through -- it would directly contribute in recurring earnings, 100% of it.

Okay. So there's also no CapEx requirement attached to that?

Sebastien has talked about the CapEx, it's EUR 8 million, so it has no impact on the performance in recurring earnings.

Okay. And do you think there's further upside in the future?

So far, 2% is a lot of value creation. So I think it's a good start.

Good. Then on Italian footfall in Q4, that was down 3% year-on-year. Do you think that's related to the Carrefour exit of that country?

Yes, Italian footfall. So we very much like our assets in Italy. We like them with Carrefour and we like them with the new operator. This is true that a new operator has bought Carrefour's activities in December. So in some way, during those transition period, it can weight temporarily on the footfall. But as there is a new operator, there will be new investments. Italy is performing well, high financial occupancy. We feel a strong interest from investors in Italy. So we are very positive in Italy. So I think it's the footfall performance has not to be judged on a long term -- has to be judged on the long-term trend.

Okay. And then last one, on the 5 major projects, if I look back at the 2023 presentation then it says they would start in 2025. And then I look at 2024 presentations, started with 2026. And now it's again pushed to 2027. Just trying to understand what drives the delay?

Well, thank you for your question. You're right. project takes time, I think, especially in France and this year, with the local election, it's true that no major step has been passed in projects in France. To give you a bit more color, we are actively pursuing the Terrassa project in Spain near Barcelona. We are launched -- the pre-letting has been launched. The project is really to build -- to develop a leading shopping center in Catalonia, 30 minutes from Barcelona. So this is probably the most advanced project.

Regarding other projects in France regarding [Orleans] despite reported delay, probably you saw the press. We expect the situation to be reconsidered after the next month local election. And we are still working on Montesson, the situation is a bit the same with the impact of the local election. So we are discussing with the local government. And to give you other colors on Toulouse Labege. Toulouse Labege, we are working to connect the center to the local metro. It's a big construction work near the center and we opened recently the biggest [ aha ] of the area, and we are working with the local authority to see how we will extend a little the shopping center to take the footfall from the metro. So yes, it's complex, but we continue to work on it. It's our job to manage a long-term project.

The next question comes from Oli Woodall from Kolytics.

Congratulations on the results. I've got 2 questions. I'll go with the first one is looking at your retail sales that were flat in France. And given that France is your largest market, how much of this you see as macroeconomic softness versus Carmila specific tenant mix issues? And do you see that as a risk as your ability to push rents when they renew? And then second question regarding valuations. Do you see other pieces of evidence that give you confidence that valuations are turning around other than the 1 basis point decrease in yields i.e., transactions in the market and things like that?

Well, thank you for your question. So on retailer sales in France, first, they remain positive. In fact, there are outperforming the market and the fact indexed and outperforming the French consumption in France. French consumption, it was minus 0.9% in '25. It's true that French consumers saw a softness in '25 and due to political and economic uncertainties. But we are confident we remain positive this year. and that's our shopping center, thanks to the Carrefour hypermarket anchors remain attractive for the footfall.

And I would like to emphasize the fact that, we also have to focus on the long-term trend beyond short-term consumption shifts. We are really consolidating our leadership in people daily lives. As you can see with the financial occupancy, the leasing activity, which was really powerful last year and so on. So we are -- we still remain confident on the orientation of sales this year.

And follow-up on valuations and market evidence, on valuations I think the best example is Carmila disposal program. In the last 48 months, we have disposed of 6% of the portfolio, and this has been made in line with the book valuation for some assets in France, for some assets in Spain. So we have clearly proven that we have the ability to sell assets in line with our book value. Now what we can see on the investment market is probably Spain is much more active than France, but there are good opportunities for good assets in France and this is positive for Carmila.

There are no more questions at this time. So I hand the conference back to the speakers for writing questions.

So about question on the chat, a question about Next Tower and the ability to disposal of Next Tower given the current multiples.

Well, Next Tower currently is developing organic growth, and we still have growth to catch and we will see perhaps one day if there is opportunity to make M&A around Next Tower, but it's not for the calendar for this year.

We don't have any more questions on the chat.

Question in the room? Well, thank you very much for your time and attention. Thank you for your questions.