DocMorris Stock

Welcome, everybody, to our H1 '26 results conference call. Today with me is Daniel, our CFO; and I'm Walter Hess, the CEO. The first half of '26 has been a milestone period for DocMorris, marked by accelerated growth and an outstanding operational execution. Our focus remains on scaling our integrated digital and AI-driven health care platform to deliver long-term profitable value. Today's agenda foresees the highlights of H1 to start with, followed by the business update, financial update and the outlook before we move then to the Q&A session.

Let's start with our highlights on Slide #4. We delivered a 38% Rx growth in H1, accelerating further to 46% in Q2 with an even stronger momentum continuing into July and August. Our active customer base expanded by 1.1 million year-over-year to 12.9 million with TeleClinic contributing 1.5 million active users.

Digital Services grew 71% in H1 and even 80% in Q2, translating directly into an over-proportionate profit increase due to the high margins. The execution of our AI-First strategy is fully on track, expecting a positive earnings contribution in H2 '26 and over CHF 15 million in recurring annual net savings by end of '27. And therefore, on the back of this strong commercial momentum, we have confidently raised our full year '26 financial guidance.

DocMorris has successfully transitioned into a unique integrated digital and AI health platform serving the 12.9 million active customers. Our high-volume online pharmacy remains the core engine, driving the distribution of prescribed medication as well as over-the-counter medication.

Our Marketplace extends our reach by offering a comprehensive range of health products and health services through trusted partners. TeleClinic, our telemedicine platform, represents a fast-growing, highly scalable take rate business model that delivers attractive margins. We are unlocking additional monetization opportunities through Retail Media and driving superior customer engagement and conversion with our AI assistant.

Let's move to the assistant on the next slide. We have successfully completed the full rollout of our AI health and shopping assistant across the entire DocMorris desktop, mobile website and app. The assistant is experiencing a fast adoption, with monthly engaged users and total sessions growing very rapidly. Crucially, we are seeing that the AI assistant users demonstrate significantly stronger platform interactions and higher conversion rates.

This conversational interface is a critical differentiator, helping customers manage their health, including prescriptions, find products and receive health advice. We are continuously further deploying new features and value-added services to further enhance retention and customer lifetime value on our platform.

Let's move to Rx now. Our Rx revenue reached a record of EUR 86.9 million in Q2 '26, representing a doubling compared to the eRx start in Q2 '24. This represents a Q2 year-over-year revenue growth of 45.8%, showcasing the speed of eRx adoption. The sequential growth of 17.2%, equal to EUR 12.6 million from Q1 to Q2 reflects a strong momentum that is even further accelerating into the third quarter. Active Rx customers grew by 15.6% year-over-year in Q2 with also strong sequential acceleration of 7.1% quarter-over-quarter. We are highly encouraged by these trends, which confirm that DocMorris is a primary destination for digital prescription redemptions.

The eRx redemption via digital channels are driving unprecedented customer loyalty, with latest eRx cohorts showing structurally superior retention and order frequency. Latest cohorts are 4.5x more loyal than legacy paper Rx cohorts and 2x more loyal than our first eRx cohorts. Also, our average order value for Rx increased significantly to EUR 120 (sic) [ EUR 127 ] in Q2 '26 coming from EUR 119 one year ago.

On the next slide, Rx customers generate over 10x the revenue of OTC customers, which also translates into significantly higher customer lifetime value. This is why we are prioritizing the acquisition of new Rx customers over new OTC customers. Simultaneously, we have achieved a step-up function reduction in customer acquisition costs, as you can see on this slide, and marketing spend since Q4 2025.

This reduction was driven by the removal of high-cost traditional TV ads and out-of-home campaigns and the shift towards efficient digital channels in combination with the extension of co-payments. The additional costs from co-payment exemptions compared to the previous bonus model are relatively small and much more than offset by the savings in the marketing expenses.

On Slide #10, you will find an update on the regulatory and pharmacy reform topics. The completed German pharmacy reform provides full regulatory and policy clarity, introducing a step-by-step increase in fixed remuneration per medication from EUR 8.35 to EUR 9 already in place since 1st of July this year and rising further to EUR 9.50 in January '27. This is accompanied by an increase in the statutory pharmacy discount, which rises to EUR 2.07 in '27. Under the newly passed GKV financial reform, patient co-payments will rise by 50% in '27 to a range of EUR 7.50 to EUR 15, which will further increase and already does, price sensitivity among publicly-insured patients.

While there is a lot of discussions and talk regarding our co-payment exemption, we just want to clarify and underline that European and national courts have fully reconfirmed the legality of our Rx bonuses, establishing that our co-payment coverage preserves principles of statutory health insurance without creating any medical disincentives.

Let's move to the Non-Rx business now. Our Non-Rx segment continues to provide a solid recurring revenue stream, growing 6.6% in H1 '26 to reach EUR 486 million. OTC and BPC products grew by 4% in H1, with growth being actively calibrated by us towards attracting higher-margin Rx customers as shown before on the slide for Rx. We are intentionally managing OTC volumes to focus on margin preservation and profitability rather than low-margin discount volumes. Digital Services, including TeleClinic, Retail Media and our Marketplace grew by a significant 71% in H1 and 80% in Q2. The rapid expansion of high-margin Digital Services is also successfully shifting the overall group margin upwards.

So let us come now to an update about TeleClinic on Slide #12. The revenue of TeleClinic grew by 48% to EUR 17.6 million in H1 '26, driven by increased treatment volumes of 51% year-over-year to 1.3 million and supported by a further growing number of doctors on the platform who also continuously increase their utilization rates. EBITDA doubled compared to H1 '25, underscoring the powerful operational leverage and inherent scalability of our telemedicine business model.

TeleClinic is, in addition, maintaining a strong pipeline of new health care and insurance partnerships, significantly broadening our strategic reach across the entire health care landscape. And in addition, they have successfully launched an AI-powered doctor appointment booking system, introducing an additional highly scalable pay-per-booking model.

And last but not least, in the business update, our Retail Media platform. dmr Advertising has established itself as the undisputed #1 health care ad network in Germany. In H1 '26, dmr achieved the first time over EUR 10 million in net sales, representing a strong year-over-year growth rate of far more than 100%. This business operates at very high profitability, delivering a robust mid-double-digit EBITDA margin directly to our bottom line.

To mention is that during the World Cup, the soccer World Cup, we run high-impact campaigns across digital TV channels, generating over 250 million highly measurable ad impressions. DocMorris also benefited significantly from this, achieving highly attractive ROAS, return on average -- on advertising spend, through precise targeting, which allowed us to maximize awareness for Rx redemption with co-payment exemption.

And coincidentally, this happened exactly with the time the regulator decided to increase co-payments starting from '27, making this a widely discussed topic in Germany. In total, we expect this highly profitable data-driven ad engine to remain a major growth and margin lever for DocMorris in the coming years.

And with that, I would like to hand over to my colleague, Daniel, now for the financial update and the outlook.

Thank you, Walter. And also from my end, a very warm welcome to everyone on the call. And it's my pleasure to present you the numbers of our first half performance and then followed up by the updated guidance for '26. If we move to the first slide, which should be known to you, even if there's an addition because we have added the operating cash flow, and I will come later to that.

But let's start with the top line. Revenue delivered double-digit growth of 13.4% in local currency and 10.7% in Swiss francs, while external revenue grew a little bit less with 12.5% in local currency and 9.8% in Swiss francs. The growth was driven by Rx, with a healthy growth of close to 40%, exactly 38.3%, and Digital Services with a growth of over 70% revenue increase year-over-year.

On the gross margin, gross margin remained more or less stable despite a negative impact due to the co-payments and this negative impact is approximately -- in the first half year was approximately 50 basis points. And therefore, the stable gross margin is even more a very good achievement, which comes also from Digital Services, which contributed due to the high sales growth relatively more to the top line gross margin.

It's also important to say that this roughly 50 basis points negative impact of the co-payments from the Rx side are more than overcompensated at the bottom line on an EBITDA level at the end of the day. Adjusted EBITDA margin expanded strongly by 350 basis points to minus 1.8% year-over-year. As mentioned, we have added operating cash flow, which also showed a very remarkable development. The operating cash flow improved by almost CHF 35 million to now minus CHF 21.1 million in the first half of '26.

With that, let's go to the KPIs. Also here, a very friendly or very nice picture and development. As you can see, customer acquisition accelerated across our business units, mainly in Rx, OTC, but also very strongly in TeleClinic, with 1.1 million new customers year-over-year, bringing the total of active customers to roughly 13 million.

In the first half of the year, the share of new Rx customers increased significantly, and that's very important, whereof the majority were new eRx customers besides a minority of OTC and also paper Rx customers, which switched to -- which have become eRx customers. These are the so-called switchers. Active TeleClinic customers grew to 1.5 million by the end of the semester.

Let's move to the average order value, which also developed very nicely. We saw there an increase from EUR 97 to EUR 101. Please bear in mind that, that's an average number, and we have clearly seen a further increase by the end of the half year. OTC kind of -- very stable over the last period. They stayed at EUR 33 (sic) [ EUR 38 ]. If we look at the order frequency, which is also important, an important KPI, we see that Rx an ongoing further increase to 4.1x, while OTC also remains stable at 2x.

Repeat order rate, you could argue in the first instance think that, that's kind of with a slight decline that, that's a bad trend, but it's quite the opposite given the high share of new Rx customers by definition than the repeat orders because in new cohorts, they all have said the new and could not be in a position to reorder. And that's the reason why if you would kind of level it out, the repeat order rate would stay at the very high level of high 70%.

Let me conclude on this slide as follows. The KPIs clearly underline the high value contribution of our new Rx customers, which basically came in as of March of this year and translating into increased average order values, higher order frequency and stable repeat order rates and which is kind of a very good basis for the future business, which we can do with these clients.

Let's have a deep dive into the P&L. As said, on top line, the revenue growth of 13.4% clearly exceeded our initial expectations. And as mentioned, mainly driven by Rx and Digital Services. The good thing is that we really -- we had to prove that the operational leverage does work. And as you have seen, despite the substantial growth, personnel expense ratio improved by 80 basis points. The marketing efficiency even translated into 310 basis points improvement of the marketing efficiency ratio, and that was kind of backed by a CHF 14 million decrease in marketing expenses year-over-year. And even distribution expenses, which everyone would expect to increase given that the high fuel prices, we could lower them by 10 basis points, and that just shows that we are there had kind of a tailwind from our operational leverage, which we have built on.

Adjusted EBITDA improved substantially by almost CHF 18 million year-over-year. The reported -- while reported EBITDA improved by CHF 7.1 million. But of course, there are substantial one-off costs of CHF 9.1 million have been -- have to be taken into account here. These CHF 9.1 million adjustments, where do they come from in the first half of the year, we recorded a total of CHF 7.6 million of restructuring costs, which were caused by 2 projects. First of all, the closure of the Ludwigshafen warehouse in the -- by the end of March of this year. And then secondly, the bigger part of our communicated AI-First strategy in June, which summed up both together of CHF 7.6 million restructuring costs.

The finance result looks also on the first view, not a little bit ugly, but keep in mind, and that's also written in the half year report that almost CHF 5 million out of the CHF 10.6 million are FX related and as usual, noncash. It's not a noncash -- has no -- a noncash impact. Why? The reason is that, that's the kind of the FX impact, which we incur on our intercompany loans given that we -- our funds are in Swiss francs and intercompany loans are on euro. And given the weakening euro, that results then always in a noncash FX loss.

Also even not mentioned here on the table because it's a small position, but just to take that off the table, interest rates -- interest expense -- excuse me, taxes have increased by CHF 1 million. I think tax -- to pay taxes, that's never ever something which is appreciated. But on the other hand, that just shows that we have already some entities which are generating less profit and revenue. And the reason is that we are talking about TeleClinic, which has to pay since last year taxes.

Of course, there are a lot of huge tax loss carryforward in Germany. But please bear in mind that different to Switzerland where you can cover with 100%, in Germany, it's a 60-40 ratio, and that's the reason why always 40% of taxes you have to pay, but with the benefit that this tax loss carryforwards are lasting forever, while in Switzerland, they will fall apart after 9 years.

On the next slide, a quick look at the balance sheet. I think most mentioned, the most important thing to mention is our strong liquidity position of almost CHF 100 million. which provides us with a comfortable liquidity buffer to reach free cash flow breakeven in the course of '27 and beyond.

Also worth to mention are the receivables, which increased substantially. I think part of it is due to the high growth and the higher share of the Rx in revenues. As you know, Rx has the accounts receivables are almost 1 month, 20 to 25 days, while on the OTC, you even have kind of a negative net working capital because you pay your suppliers once you have already received the cash from your customers. And this has kind of an impact of roughly CHF 8 million in the first half and the other impacts were one-off effects, which won't occur going forward.

Net debt increased by CHF 36 million to CHF 174 million, while the group balance sheet remains very solid with a healthy equity ratio of 46%. Overall, financial flexibility remains well aligned with our medium-term operational road map.

The next slide should also be known to you, the 2 metrics: the indirect cost ratio and the net working capital. Overall, our indirect cost ratio improved by 20 basis points year-over-year. Very remarkable is that in the online pharmacy, meaning OTC, Rx, the indirect cost ratio could substantially be reduced being on absolute but also relative levels. While on our Digital Services, we made some investments into the platform, the fast-growing platform to cope with the fast growing -- fast growth of especially TeleClinic and Retail Media.

Worthwhile to mention is that the implementation of our AI-First strategy will have an additional positive impact on our indirect costs, which is not yet reflected here and that will happen over the next 18 months as an additional pattern to the ordinary course of business indirect cost management.

The net working capital on the right hand -- the right-hand chart expanded by 40 basis points year-over-year, which means, as I said, mainly driven by the higher share of Rx revenues, which has kind of an increase of the accounts receivables as a consequence. And I mentioned the negative impact on the net working capital is roughly CHF 8 million. Having said this, we are maintaining active working capital management to optimize ratios as Rx revenues will further scale.

Let's have a quick look at our AI-First strategy. As you know, we have, by the end of June, announced our AI-First strategy, and we are very pleased to communicate at this point in time that we are fully on track to capture this above CHF 15 million of recurring savings fully phased in by the end of '27.

All savings will directly translate into free cash flow with roughly 75% hitting also the EBITDA level. The balance, the 25% balance being lower tech development costs, which is a huge substantial part of the AI-First strategy, which you know are capitalized and therefore, are kind of have a cash impact, but not an impact on EBITDA, and that's the reason why the cash impact is higher than the impact on the EBITDA level.

In the course of the announcement, we have executed the layoff of the people, and we have at this point in time, dismissed over 100 FTEs, which was kind of as announced the plan, and that has now been fully executed. By the end of '27, we assume annual CapEx savings of over CHF 5 million. That's also mainly in the tech area where we need much less coders given that the AI tools can do that by themselves much faster and at equal efficiency or even higher efficiency but also kind of quality level.

As a consequence, we have lowered our CapEx guidance for '26, which was around CHF 30 million to below CHF 30 million. The onetime restructuring expenses of CHF 4.3 million in relation to the AI-First strategy, which we have booked in Q2 will be largely offset in the second half of '26, given with the kind of savings which we can already realize in the second half of this year.

Now let's move to the second part of the presentation to the update of the guidance and especially to the overarching target of this year to achieve EBITDA breakeven in the course of '26. Also kind of a chart which should be common to you or known to you, we have added the Q2 EBITDA performance of minus CHF 4.6 million. And also refined the coming quarters. Funnily, it's more or less exactly the same figures. We had not do any bigger deviations. Therefore, that shows that the planning wasn't that bad at this end.

But having said this, we are even more comfortable that we will reach the EBITDA breakeven. You see that the dark green, that's basically the midpoint, kind of the, let's say, the safe side. And then we have some deviation on to the low end and the top end. And it's clear that Q4 will be EBITDA positive. And on Q3, we are working to get close to already being EBITDA positive.

Where is our confidence coming from? I think, first of all, the achievements which we realized in the first half, but then also very important that the few weeks since then and up to today show the continuation of the strong trends which we have seen in Q2. And even despite holiday season, some further acceleration, and that's why we are -- where our confidence is coming from.

Then thinking already into 2027 where the next milestone is to achieve free cash flow breakeven. We have and well knowing that operating cash flow is not -- does not equal free cash flow, but just to show it's a starting point to come to free cash flow, the operating cash flow development. There, you see a remarkable development year-over-year coming from almost minus CHF 56 million to minus CHF 33 million in the second half last year to minus CHF 21 million.

And also there will be -- the same trend will be ongoing. So that we will have a very good and strong starting base into '27 to tackle then the free cash flow breakeven in the course of the year '27. Where does this EBITDA -- operating cash flow improvement are coming from? First of all, clearly, EBITDA, the EBITDA improvement, but then also driven by lower interest expenses, which helps there to drive the operational cash flow.

With that, let's come to the slide with the official guidance, and I provide you also with the soft guidance accompanying the hard guidance, which you also can find in our media release this morning. On the 3 metrics we put forward in March when we guided for the financial year '26, top line. And here, we are talking external revenues. We guided mid-single digit to low teens, which is somewhere in the area of 3% to 12% in our interpretation. And we now narrowed and increased the range to 9% to 13% coming from 12.5% by the end of the first half of the year.

Adjusted EBITDA, we also substantially narrowed down the range from minus CHF 10 million to minus CHF 25 million, to minus CHF 10 million to minus CHF 17.5 million, which implies at the best end basically kind of positive EBITDA for the second half, but clearly skewed towards kind of still slightly negative EBITDA for the second half if you kind of put the minus CHF 10.9 million EBITDA for the first half into this range.

CapEx, I already mentioned, we lowered from around CHF 30 million, which was kind of rather CHF 30 million plus now to below CHF 30 million. And I think that also will be something which will stay and will have a positive impact going forward. As mentioned, of course, we reconfirm EBITDA breakeven in the course of '26 and free cash flow breakeven in the course of '27. And also our midterm targets remain unchanged with roughly 15% revenue growth, 8% EBITDA margin and roughly CHF 30 million CapEx per year. But you have heard my comments in relation to CapEx, and we will have a close look at it when we look at the midterm guidance the next time.

On -- very important, that the soft guidance to the top line growth of 9% to 13%, basically the same pattern which we provided to you in March. Rx has developed much more in favor than we thought and is still developing very strongly. That's the reason why we raised the soft guidance from around 20% growth to around 40% growth, which is already underlined with Q2 with over 40% quarterly growth.

On the OTC, we keep the soft guidance with mid-single digit. Based on the comments Walter made that we are really kind of managing profitability and customer quality. And Digital Services, we guided before softly kind of mid-double digit, which translated at this time to 40% to 60%. And now we specify that Digital Services will grow above 50%.

And with that, thank you very much for your attention, and back to Walter or the team for the coming Q&A.

We already have a few questions in the queue. The first one goes to Jan Koch from Deutsche Bank.

I have 3, if I may. And I would like to take them one by one, if possible. The first question is on your Rx strategy, which seems to be paying off. How much did you spend in H1 to cover co-payments? And it also appears that you plan to cover the increased co-payments next year. How do you ensure that this does not result in loss-making orders? And for how long do you plan to cover the full copayment?

Yes. Thank you, Jan, for this question that everybody is raising who talks to us. So as I have explained before, so the step from the bonus model before to the co-payment is relatively small. So it's not a big traditional step on what we have to spend there, whereas the optimization of the marketing spend is much, much bigger. And therefore, the approach we have chosen is a very economically reasonable approach and it shows month by month. On one hand with the growth, but also on the other hand, with the results that we had with the Rx growth that this is really, for us, the right and good strategy.

Regarding [indiscernible], we have never told to the market that we are going to take over the full co-payment for the whole market for everything in next year. So -- and you can be assured that what we will do next year will again be economically reasonable.

And yes, we'll support the Rx business, but in a way that we also achieve our overall targets, which is becoming next year cash positive, and we have the midterm targets that we [indiscernible]. And to achieve them, that's the overlay of it. This will drive our policy also in the next year, which we will communicate if the time is the right one.

Okay. Great. And then secondly, on your guidance philosophy, the upgraded guidance still appears somewhat more conservative than your targets in recent years. You are already at the upper end of your sales guidance after H1 and then you mentioned Rx growth accelerated further in the first weeks of Q3.

So -- and then also based on the chart on Slide 22, it seems unlikely that you will reach the full year adjusted EBITDA loss of CHF 17.5 million. Are there any potential headwinds worth flagging in H2? Or are you just simply taking a more conservative approach here?

Let me answer that question. I think we are a little bit burned. There's a lesson learned of that. You develop the under-promise and over deliver than the other way around. That's if you tell me now differently, then we will take it, but it won't change anything. No, I think more. On a serious note, I think that the current trading definitely would maybe justify a little stance of more guiding more aggressive. However, as you said, we do not see any headwinds.

But as like with the thunderstorms or hurricanes, you can't -- you don't see them come and all of a sudden, they are there. We do not expect anything, but we also would like to have some buffer to the upper end, to the lower end, because yes, I'm now with 2 years and basically every second week, there's something new is popping up, which looks initially kind of threatening, but we always get away with it and get around of it. And therefore, I think we are just not in a business which is going straight and smoothly. And therefore, we definitely have built in to both ends a little bit of buffer.

Great. That sounds good. And then lastly, did the recent heat wave have any impact on your OTC or your Rx businesses?

Yes. On the OTC, of course, it had, let's say, an impact. But throughout the year, this will be again compensated. On the Rx, as also mentioned, we see further acceleration in July and August. So I think the need for medication based on prescribed medication on chronic, there is not -- at least not a negative one, if then a positive one, on that angle. But it's nothing that would change our view on the full year.

The next question is from Urs Kunz, Research Partners.

I have also 3 questions. First question is, again, regarding your guidance on the adjusted EBITDA, this range. Could you elaborate a little bit? Is the range dependent on the growth? Or are there other things that make it more being CHF 10 million or CHF 17.5 million?

Then the second question is just a short one on the adjustments in H1 were CHF 9.1 million. Is this all for the whole year? Or do we have to expect more in H2?

And the last question would be on transport costs. You mentioned somewhere in a slide that they are up EUR 0.20. Are you confident that this EUR 0.20 is enough to fulfill all requirements that we see that are -- yes, we see now?

Okay. Let me start with the first question, EBITDA guidance. I think we -- that's clearly derived on our amended forecast that the budget will, because we have a rolling forecast there, which has kind of the soft guidance, the top line growth as underlying components, and that's derived from them. And if I think that happens, then I think that's somehow calibrated to the midpoint to the guidance. And if we are kind of better or worse, then we have a deviation within the range.

But I think it's definitely -- it's top line, but it's also kind of the execution of our cost measures that this will run as planned for the time being that, that works out perfectly. And I think these are basically the main drivers of the EBITDA guidance.

To second question, adjustment in H2, which we already know because otherwise, we should need to disclose it. No, I think that won't be in that magnitude. I can rule it out maybe a few hundred thousand to CHF 2 million, but nothing more. And what was the third question?

Transport cost.

Can you repeat the third? Oh, transport cost.

Yes, that.

They are factored in transport costs, but this additional EUR 0.20, they were not yet effective in the first half. Therefore -- but for the second half, that's fully factored in and it's taken care of and there should not be any negative surprises on that end.

And you're confidential (sic) [ confident ] that this is enough for all the requirements, be it temperature things, signatures, and so to cover it?

Yes. That's mainly the signature that you have to -- and then we have that negotiated with the logistic providers, and that's the reason why we are very confident on the cost.

Next question goes to Sebastian Vogel, UBS.

I've got 3 questions. I also would ask them one by one. The first one is on the marketing spending. In terms of exit rate so can you give us a little bit of an indication how was it in the end of the first half? And what is the sort of, as potential states, the number that is the one that you're aiming for going forward?

I didn't get the first part of the question. What is the...

The sort of the exit marketing spending. So in that sense, what you have seen a 5.8% for the full first half. Was it in June or in May more like closer to the 5%? Or was it closer to 4%? Or was it actually above the 5.8% to have a little bit of an understanding what's the 5.8% worth, essentially?

I think you have to take into consideration that basically January, February, there were no co-payment on the medpex front and therefore, the half year does not show that the full half year is only 4 out of 6 months. But I think you can -- therefore, you should maybe slightly keep it as it is or slightly increase it. And -- but I think that's for the time being, that seems to be a reasonable run rate also for the second half of the year.

And then from '27 onwards, as Walter mentioned, we are about to define our Rx copayment strategy. And therefore, any statement here would not be backed. Therefore, let's focus on the second half of '26, where you can assume more or less the same marketing ratio.

Got it. My second question would be on the net working capital side. Do you see that as a sort of a headwind or a tailwind in the second half?

The second half, I see it as a tailwind because, of course, if you listen to us, we assume that maybe the relative size could still slightly increase, but we have initiated measures, and we will initiate further measures. And the half year, it's always kind of from a network capital point of view, a little bit worse than at the end of the year. And therefore, I assume kind of a neutral to slightly positive trend, but rather neutral.

Got it. My third question would be on the contribution margin. You in the past have given some indications where you're aiming for and therefore, to have a bit of mark-to-market, so to say. Can you give us a bit of a sense there what is the contribution margin after fulfillment cost at the moment, at least in the ballpark for Rx, OTC, Digital Services and on a group level, if possible?

I think all of our friendly competitors will be very interested in these details. No, that's something which we would not like to disclose because that's highly relevant from a competition point of view. But we can have kind of a deep dive in a smaller round and then we can provide you with a little bit of guidance there, yes.

The next question is from Ramon Huber, Limmat Capital.

I have 2 questions. First is like you telling that it even accelerated after end of June, the Rx sales. You see that as percentage-wise because like the Q3 last year was compared to Q2 also very strong. So is it percentage-wise even better than what we have seen in Q2?

Yes. As indicated in Q2, it was the 46%, and it continued to further grow also percentage-wise in July and August so far.

Okay. And then coming back to the guidance. And so what has to happen that at the end, you get lower than this CHF 10 million? When you take your pattern, let's say, you talked about that you try to work getting closely already in Q3 to EBITDA flat or slightly negative. So what has to happen then in Q4 that you get below CHF 10 million in the negative case?

I think basically, we have to find kind of additional CHF 1 million. I think it's -- Q4 is always a good quarter. And I think, let's say, the basis whether we are rather going to the aggressive or the lower or the higher end of the range is definitely Q3 because Q3 is extremely difficult to predict. It's holiday season. Now we have this heat wave, which is what's kind of had no impact on the Digital Services and Rx, but let's say, OTC would -- could have been better. And let's see how Q3 turns out and because Q4 is much more predictable and manageable and Q3 will lay the foundation to where we will end up in our EBITDA range.

Okay. But Rx definitely will help then?

Rx always helps, not only today but...

And then what we see is we really have a good momentum, be it in Rx, be it in TeleClinic, be in Retail Media, Marketplace anyway. The costs are managed extremely tight. We have announced in June the layoffs, which all have already been executed. So we will see also there the results in the second half of the year.

And as Daniel mentioned before, that the past learned us to be cautious with the guidance. And of course, we try to be at the good end. But yes, as Daniel said, let's now accomplish Q3. We will communicate then after Q3, and then let's accomplish Q4 and talk again then about where we end this year.

Question goes to Guillaume Galland from Barclays.

I have 3 questions, if that's fine. The first one is on Non-Rx. So it feels like it's been growing 4% in Q2 on the OTC side. But we're looking at the end market trends in July, it feels slightly softer. So any color here would be helpful. And also thinking into H2, it feels like Q4 has tougher comps. It was a pretty strong quarter for you last year. So should we assume something around low single-digit in Q4?

My second question is around customer acquisition costs. If you could give some color around the trends there, how it improved year-on-year, would be super helpful and whether it is sustainable into H2? And the last one is more on the financing side. So we're looking at the '28 converts, it feels it's now well into the money. So should we think about the balance sheet today? And any update on the capital allocation policy?

Sorry, your connection was quite bad. Could you please repeat the third question?

Yes. The third question was on the financing and the converts. So when looking at the '28 converts, they are well in the money. So I just wanted a quick update on the capital allocation policy and how should we think of the balance sheet going forward.

Let's start with the last question. The '28 convertible, yes, you're right. I think it trades roughly 150%, 160%, and it's full equity. I think we -- it's not a year ago, I think we launched it, and we will -- of course, we evaluate our options, what we can do with it. Unfortunately, it has no soft call in it because the maturity is only 3 years. But we -- I think, first of all, it's extremely comfortable situation because that's basically -- we consider it as equity and also provides us with kind of optionality, which we will take into consideration and make our heads around this.

The second one regarding customer acquisition costs. As you have seen on Slide #9, we really have optimized and driven down the customer acquisition cost to a really low level. And we continue to further optimize, of course, but we think that, that level in combination with the co-payment exemption, we have a very good base to further accelerate growth and also, yes, continue the path that has started a few months ago with Rx. And the first question?

OTC market trends.

Yes. On the OTC on the market this year, the market in the first half year was also around 3.5% to 4%. The overall market growth. So we are at the same level as we steer it to that level. At the end, the reason I explained before, we focus on profitable and the long-term more profitable Rx customers. And -- so on OTC, we see a continuation that the overall market continues to grow low single-digit percentage.

On telemedicine, you have seen growth there, and this will definitely continue. Telemedicine will become more and more important also in the standard of care in Germany. So there, the trend very much goes further, might even increase. And also on the Retail Media, as we are really at the forefront there. And in Europe and mainly in Germany, Retail Media is quite a young discipline. Also there, we see a strong upward trend also in the next years. Does this answer your questions, Guillaume?

Yes.

The next question goes to Gian-Marco Werro from ZKB.

Just 2 questions left from my side. So first. You mentioned in the beginning of mid-March that you have there also combined the development teams to also improve the traffic, also the customer engagement and customer loyalty on your platform. So besides the health companion, is there anything more to come also out of this partnership that you might roll out in the second half of this year?

And then the second question is just a nitty-gritty one on the other operating income. Last half year, you still had the CHF 4.4 million other operating income. Now it's only CHF 0.5 million. Is there any change? Is there more to come in the second half? Any seasonalities in there? Or is the normal run rate on an annual basis, roughly CHF 1 million of other operating income that you expect there?

I'll start with the last one just to get that out of the way. I think last year, remember, and that was also an EBITDA adjustment, we had the sale of 2 nonoperational real estate being the facility, the warehouse in Heerlen, and then the property in Steckborn, which accounted for CHF 3.5 million. And what you -- that went into other operating income. And what you see in this year, there's no exceptional operational income and the CHF 0.5 million or CHF 1 million on a yearly basis is kind of a slightly growing base there, and you can take this CHF 1 million for the full year.

Yes. And the first question about the companion. So for us, it is really a very strategic asset that we have built and launched last year. And now we have rolled it out over all the DocMorris platform. And we see really that the acceptance of the customer is very good. And the engagement of the users, making use of the assistant is very good because it's a shopping assistant. It's a health assistant. It's an assistant for customer service. So it's really a 360-degree assistant.

And yes, we see already now, we see a relevant impact on our -- all our main KPIs, and we further develop. So we are preparing to roll out further services, which again will increase engagement. We are focusing also on specific chronic diseases that we will reinforce via the platform and with the help of the assistant. So yes, there is a lot of things being deployed week by week also in the background, and which shows results that are online and which will also help in the future. And it's for us really also a USP, what we have built here.

Thank you very much, everyone, for your participation. With that, we answered all the questions, and I would like to hand over back to your host for the closing remarks.

Yes. Well, thanks a lot again. Yes, thanks to all of you for joining this call, for taking the time. I hope you got the information that is necessary for your assumptions. On our side, we can just say on our side, the lamps are on green. And we are rapidly advancing with our transformation of the whole platform of the digital and AI health platform in all regards. We are rapidly executing our AI-First strategy. We see a good, even great momentum in Rx, Digital Services. So we control costs really well. We reduce them month by month.

And with that, we can just reconfirm we are very confident to achieve also the raised guidance '26, and we are very confident to achieve the -- to become cash positive in the course of 2027. And with that, thanks a lot again, and I wish you all a nice day. Bye-bye.

Good morning, everyone, and welcome to our Q1 '26 trading update. I'm Walter Hess, the CEO, and I'm joined today by our CFO, Daniel Wuest. In line with what we announced at the full year conference, we will provide transparent quarterly insights into our path to EBITDA breakeven, which is why we are hosting today's call.

Just a few weeks ago, during our full year '25 results, we outlined our strategic evolution from an online pharmacy player to the leading digital and AI health platform, the engine for our profitable expansion at scale. Today, we will show you the facts that validate our successful development.

Let's move straight to the Q1 highlights on the next slide to demonstrate how well this engine is now accelerating. Overall, we achieved a strong revenue growth of 10.7% year-over-year. Our Rx business showed outstanding momentum with a 30.4% growth year-over-year alongside a strong 7.6% sequential growth compared to the previous quarter. The growth was fueled by accelerating month-over-month with a remarkable uptick in March, which also continues in April. Our high-margin Digital Services business continues to scale rapidly, achieving an impressive 63.1% growth rate while consistently increasing margins.

In Q1 '26, we successfully expanded our ecosystem platform, growing our active customer base by 1 million year-over-year, whereas 0.4 million in Q1 '26, to a total of 12.6 million, which is a great achievement. And most importantly, and as you know, our main priority, we improved our adjusted EBITDA by CHF 10 million year-over-year to minus CHF 6 million, proving we are on track to achieve our breakeven target in the course of 2026.

Let's move to Slide #5 now. The 30.4% year-over-year Rx growth clearly proves that our strategy to capture the potential of the Rx market is highly effective. It shows that the patients are more and more familiar with our Digital Services and increasingly value the comfort of home delivery. We saw a growth in Rx orders from month-to-month with a significant uptick in March, rounding off a very successful first quarter and also continuing into April. And this acceleration comes together with a more and further optimized channel mix, which pleasingly increased RAS, return on advertising spend, and decreased our customer acquisition costs even further. Ultimately, this is a strong start into the year, and it demonstrates the growing stickiness of our health platform.

Our non-Rx business remains a reliable driver of value, delivering continuous and profitable growth of 6.5% year-over-year to fuel our broader ecosystem. We managed our OTC and BPC business according to plan to a growth rate of 4.4%.

Our Digital Services, including TeleClinic, Retail Media and our Marketplace grew further by an outstanding 63.1%. These digital business lines are not just growing top line, they are delivering increasing margins and therefore, a significant EBITDA contribution. And on top of it, the strong platform performance and expansion also forms an excellent basis for our Retail Media business.

And now I would like to hand over to Daniel.

Thank you, Walter. And also from my side, a very warm welcome to all the participants.

Let's move to Slide #7, where you see the EBITDA bridge, which we also provided to you during the full year figures in March. And I want to start this with the following comments. We closed Q1 with an adjusted EBITDA, as Walter already said, with minus CHF 6.3 million, representing a substantial improvement of almost CHF 10 million, exactly CHF 9.8 million compared to the quarter of last year. That's proving our continuous path to profitability. The adjusted EBITDA margin improved by over 360 basis points from minus 5.7% to minus 2.1% in Q1 compared to the previous year's quarter. If you look at the chart and you see since Q1 '25, we have seen an ongoing quarterly EBITDA improvement driven by basically 3 factors: Better operational performance, focus on marketing efficiency and also very important to mention, disciplined cost management.

Amongst other, you remember, we have closed the Heerlen Logistics operations last year. And this year, we have announced the closing of Ludwigshafen, the warehouse and their respective logistics operations, which have already contributed substantially on the cost side, but will further contribute during '26. And I can also confirm that with the closure of Ludwigshafen, we are very well on track. We will see first positive operational effects there in the second half of '26. We continue to be very transparent, and you see with this minus CHF 6.3 million in Q1 '26 in the chart on Page 7 that we expect the quarter result almost on the same level for Q2. And then as already mentioned in March, we aim for getting close to EBITDA breakeven in Q3 and there will be definitely EBITDA breakeven in Q4. And I think that's what the management team is kind of aiming to achieve.

All in all, our Q1 results demonstrate that our measures are working and will further work because it's not yet done, and bet DocMorris is very well on track to achieve EBITDA breakeven in the course of the year. We are relentlessly executing our plan with precision, knowing that our strategy, the evolution from a leading online pharmacy to a leading digital and AI health platform will pay off.

With that, I would like to go to Slide #8. There, nothing new. Backed by our strong Q1 performance and our current trading, where we see an ongoing positive trend from March, we are fully confirming our short and midterm guidance as laid out on the full year presentation in March. That means we confirm our '26 adjusted EBITDA target in the range of minus CHF 10 million to minus CHF 25 million, strongly supported by the improvements we have already seen and delivered in Q1. We are confident to achieve EBITDA breakeven even if we would be at the higher end of the guided external revenue growth guidance. And just for your memory, we guided mid-single-digit to low teens percentage range. And as you have seen in Q1, we can deliver on the EBITDA target even if we are at the upper end of the overall revenue guidance. All in all, we firmly reiterate our commitment to reaching EBITDA breakeven during '26 and achieving positive free cash flow in the course of '27.

And with that, I hand over to Walter.

Yes. Thank you, Daniel. So before we move to Q&A, I want to briefly address the upcoming Annual General Meeting and the future Board composition proposals.

Our Board proposes 3 independent nominees, Thomas Bucher, Nicole Formica-Schiller and Dr. Thomas Reutter. Together with our existing Board members, this composition brings targeted expertise across the areas most critical to further execute on our strategy. Management's clear preference is for continuity and stability. We are at a pivotal point in our development. Consistent, focused execution requires a Board that is aligned, experienced and ready to act, not one in transition.

All proposed new nominees are fully independent and stand for the interest of all shareholders. We believe this is the right team to take DocMorris forward, and we encourage shareholders to support these nominations at the AGM.

Let me conclude the call with a clear message. Our vision of health in one click is not just a concept. It is fully operationalized through our integrated digital and AI health platform. However, a strategy is ultimately defined by its execution. Our Q1 results deliver strong proof that our measures are working and DocMorris is firmly on track. We are not just making promises for the future, we are delivering today. This is clearly demonstrated by our strong Rx growth and the 63% expansion in Digital Services and our continuous EBITDA improvements.

My clear statement to you is that the transition to a profitable digital health ecosystem is fully underway and is yielding tangible financial results. We have the right strategy. We have the right management team and the operational proof is in place. We are executing with absolute focus, and we are pairing the necessary sense of urgency with a clear commitment to long-term value creation.

And with that, we would like to move over to the Q&A part of this call.

[Operator Instructions] And we have already some questions. The first question comes from Mr. Koch from Deutsche Bank.

My first one is on Rx. Encouraging to see that the growth rate has accelerated again in Q1. If I analyze your Q1 number, I'm already quite close to your full year guidance. So is there anything we should consider here? Or is your full year guidance just a bit more conservative than in recent years?

Then secondly, on profitability, could you confirm that the loss in Q2 is not expected to be higher than in Q1? And if so, the upper end of the EBITDA loss range looks quite unlikely as well. Any comments here?

And then lastly, are there any upcoming regulatory changes that we should keep in mind? There have been some headlines on the potential changes to the cold chain requirements. So any color here would be helpful.

Yes. Thank you, Jan, for your questions. Let me take the first and third question. And then the second one, I would like to hand over to Daniel. On the Rx, what I just can confirm that we continuously improve the marketing mix, the performance of the marketing. And with that, we just see a really good development. And yes, so let's meet again in August, and then I can further -- or we can further give you more details about the growth and what you can expect also in the second half year and for the full year. About profitability, maybe Daniel?

Yes. I think that's always the backside of being very transparent and you did the right math or measuring up on the scale. I think it would be -- if you already would know how Q2 would come in, especially on the bottom line, then my life would be much easier, and we would now go out and [indiscernible] join with the fun. No, but on a more serious note, definitely, we aim for EBITDA -- quarterly EBITDA in the area of Q1 and knowing that Q1 and Q2 are usually the weakest quarters and with acceleration in Q3 and Q4. However, having said this, as Walter already mentioned, we see very good traction coming from March and also has been transferred into April, even that basically, we had 2 slower weeks due to the Easter time and related vacation. And therefore, I would kind of confirm your view that you could assume that it will be roughly on the level of Q2. But of course, we have -- the management has a higher ambition to maybe improve it to the upper end of the midpoint of the shaded bar, which you see in the chart.

Okay. And then coming to your third question about the regulatory development, and you mentioned the cold chain. So as you all know, there is a draft of regulation, which has been issued by the Ministry of Health. And now the EU Commission intervened and basically said that it's a violation of EU law again, we have to say. For us, it's a positive signal because we see it equally. So now the ministry has to adjust this draft. And it's really just a draft, and it's only on the regulation level. So we see it as a really positive sign as I think also the market has seen.

The next question is from Mr. Kunz from Research Partners.

I have just one question regarding Digital Services. If I calculated correctly, you had a growth rate of 110% in Q3 and then 95% in Q4. Now you have 63% in Q1. And this is a rather steep deceleration. Is that something we have to think about that it's going further down in the coming quarters? Or is it going to stabilize? Because you have your guidance or your inofficial guidance of mid-double-digit percentage range for the whole year, which would translate to, I guess, 40% to 60%.

Thank you, Mr. Kunz, for the question. I think your calculations of the last year and the quarterly development are, let's say, more or less right. And as mentioned, we indicated when we guided for Digital Services that we are aiming for mid-double-digit growth, which we would also translate into 40% to 60%. And with the -- we are now actually at the upper end. And I think in relation to TeleClinic, there, the TeleClinic was slightly below the average, but we have kind of disclosed for Q1.

But as mentioned, you have to remember that last year, TeleClinic has won the TK tender, which is by far the biggest insurer in Germany. And there you have seen a huge increase in volume starting in December, but mainly in Q1. And you can expect and assume that there will be kind of a leveling out, i.e., that the base effect will then, from Q2 onwards, play in favor of TeleClinic. And having said this, TeleClinic has several tenders outstanding where we expect to get feedback rather sooner than later and which could then also basically, if they would go into the right direction, give some additional top line growth, which was not reflected in the initial guidance, which we had put out in March.

I think just to add there, I think top line growth is one, and we also explained in March that in -- with TeleClinic, we always have years where with high growth, but let's say, stable profitability, margin development, which was last year because the growth was 3 digit, but the margins more or less were stable. And this year, and that deliberately, we see already in the Q1 that the growth is a little bit lower, but the margins have substantially improved, and we expect that this will continue during the year, meaning that we are not talking kind of a 3, but rather kind of a 4 as the first number in the margin profile.

Okay. But all in all, you're quite confident that the growth rate in Digital Services in the next few quarters stabilize somewhere in this double-digit percentage range, mid-double-digit percentage range and then not kind of constantly going backwards?

No, no. I think we hope it will be the other way around, but let's see. But we are very confident that this 40% to 60% is for the time being that the wide range and not any -- adjustments to the downside are definitely not a topic for this year.

[Operator Instructions] And the next question comes from Guillaume Galland, I hope I pronounced your name correctly, from Barclays.

See, I have one question maybe on the non-Rx and OTC side. So yes, could you give us a bit more color on what you're currently seeing in German OTC? And -- so your peers have flagged some softness in the market, which was seen in Q4. [indiscernible] in Q1. It seemed that OTC has slowed in Q1 for DocMorris. So keen to hear a bit more on the consumer demand and if you've seen any changes on the competitive intensity.

Thank you, Guillaume. Happy to answer that one. So obviously, the market is going on more or less the same level and pace as also the Q4. For us, it's important. We have a plan to grow mid-single digit with OTC and BPC, and this is the level where we manage growth in that part. And yes, so as you might remember, generating OTC growth would not be really difficult. So we could grow further, but it comes with a price. And our priority is very clearly on profitability. And this is why we decided also to soft guide OTC on mid-single digit, what works well in Q1 and also in Q2, the start in April.

And then regarding -- sorry, Rossmann and dm, any change here in terms of competition?

Sorry, I didn't understand your question.

Have you seen any switch in competition from Rossmann and dm in the market on the OTC side?

No, we don't feel additional competition at all.

Guillaume, so to make it very clear, I think on the OTC, we have compared from Q1 -- Q4 to Q1 this year, we have not changed anything. We have exactly the same amount of marketing spend, marketing ratio and everything. And that's the reason -- you do not have to ask us why in Q4, we all of a sudden got to a double-digit OTC growth. But I think that was somehow exceptional. But Q1 is really according to plan and budget and to guidance, which we provided this mid-single digit and this 4.6%, we are perfectly on track to -- in this respect.

Okay. So as there are no further questions...

Yes, one more question. It just came in. I'd like to interrupt you. So the next question is from Gian-Marco Werro. The floor is yours. Yes, we can't hear you, Mr. Werro. I'm sorry.

But we can answer your question off the call at any time. So we are, of course, achievable -- available. Okay. So let's end this call. Thank you very much for taking part, for spending the time. I just can confirm we are really well on track. The management, the company needs stability and consistency, and we are strongly executing and fully focused on delivering the guidance that we have promised to you and to the market.

I wish you a wonderful day and looking forward to seeing you and meeting you in August latest. Thanks a lot.

Thank you.

So good morning, everybody, here in Zurich and at the webcast. It's a pleasure for us to present our full year results 2025. With me today is Daniel Wuest, our CFO. My name is Walter Hess. I'm CEO. Let's go straight to the highlights of 2025. We delivered on our promises, and we met the financial targets 2025. We achieved 11.1% of revenue growth and minus 48% adjusted EBITDA. And with that, we achieved our guidance. The growth of Rx was 33.2% and of non-Rx, 7.1%. The digital services with a growth of 110%, so a remarkable growth rate again and a significant profitability contribution, it's a contribution margin free, which is more than 50% already of the total company. Our AI Health Companion, which we have started to launch in October last year as a beta version in our app has been adopted really very fast. Already every third app user is utilizing this AI health assistant.

And with the strong liquidity position of CHF 160 million by end of the year, we are very confident to execute in 2026 and 2027 according to our plans. We are fully aware of the challenging and also critical market environment. However, we today focus on the future on our successful transition and on our path to breakeven and to cash generation. We do that by giving you an update on our strategy first, followed by a business update and then the financial update and outlook given by my colleague, Daniel, before we come to the Q&A session.

There are some real important megatrends in health care, which have a big impact on our business. And we see us at the sweet spot of the 3 major megatrends. One is the demographic change, which gives a structural shift towards prevention and longevity, but mainly also towards a higher chronic care demand. It's the growth of the pharmaceutical market, a market which is not dependent on the business cycles as we see right now in this difficult environment worldwide. Last year, the market size in Germany of pharmaceuticals reached already EUR 62 billion. It's a huge potential for us being captured with electronic prescriptions. And the third megatrend is the digitalization in health care, which is even accelerated now by AI.

And also there, we are at the forefront with our digital and AI health platform. How our response to these megatrends looks like, we would like to show you with a short video. It's a video about our health companion, which is live in the app already since last October.

[Presentation]

As you can see, we are evolving from a transaction-led retail business into a health platform that orchestrates and covers the full customer and patient journey. By merging the online pharmacy with a marketplace not only for products but also for health services, digital health services and telemedicine orchestrated by the AI Health Assistant alongside with a state-of-the-art retail media business, we have created a platform which is unique and it's a novelty in Europe. This trustworthy and integrated platform with more than 12 million active customers, more than 1,000 marketplace sellers and more than 6,500 established doctors in Germany allows us to capture the full value of the entire journey. It makes our business fundamentally more defensible and less dependent on linear retail market growth.

With the structural foundation now firmly in place, we are ready to ignite the platform flywheel and accelerate our scale at low marginal cost. And with that, let's move to the business update now. And of course, starting with Rx. What you see here is the sustained quarterly growth of our Rx business. And I can already confirm now that this will continue in Q1 2026. Last year, we achieved a growth rate of -- a growth of 33%, which leads to a 1.8% higher revenue in Q4 last year compared to the first quarter in '24, just when eRx started in the German market.

If it comes to the quality of the eRx customers, I have to mention that the European and the German Court of Justice last year they confirmed -- reconfirmed that we are allowed to give bonus to our customers and patients. Therefore, we have restarted to do it in July last year with the result of increased retention and higher order frequency of new and of existing customers. And this led to a 3x higher retention rate and order frequency of customers that they are getting now also bonus with eRx compared with the customers, the previous customers that sent to us the paper prescriptions. Also, the average order value is growing quarter-by-quarter. In Q4 last year, the average order value of an eRx order was already at EUR 128.

And just a few days ago, we have waited a long time. The doctors and insurance associations communicated that they have agreed now on a chronic care flat rate for doctors, and they will start 1st of July. But it's limited to a few diseases and to specific customer segment groups. In our view, it's a good start. It's a start in the right direction, in the direction of a more efficient and a more customer-centric health care in Germany. And it's a start of a catalyst, which is called repeat script, which we have already integrated in our product as we speak right now. It was important that in the first 5 to 6 quarters, we could -- we invested in creating awareness for the CardLink solution, the solution that customers, patients can read in prescriptions digitally.

We have seen that the incremental cost of new customers that we had to find and to acquire via upper funnel channels like TV, out-of-home or radio were ineconomic with regard to the relation of customer acquisition costs to customer lifetime value. Therefore, we have started to shift, and we have done it in Q4. We have shifted and we have reduced the marketing spend into the Rx acquisition. And we have started to prioritize on performance marketing channels to ensure that we remain in the economic zone, which you see on the slide, it's the green zone with our customer acquisition costs in relation to customer lifetime value. But in addition, we have a growth lever, which is the direct bonus and the exemption from co-payment, which in combination, gives us the right mix to continuously grow with our eRx business.

Let's come to the non-Rx business now. Here, you see we grew by 7.1% last year. If we talk only about the OTC and BPC business, the growth was 4.8%. But this growth came with the discontinuation with Zur Rose brand, which accounted for 2% to 3%. So effectively, the growth of the OTC and BPC business last year with the remaining brands was between 7% and 8%. It also came with an improved marketing performance, leading to higher customer retention and better customer lifetime value of our OTC and Beauty Personal Care customers. The digital services continue to grow remarkably with 110% on revenue growth with continuous really attractive margin. Both will go on also this year and beyond.

On Slide #13, you see that our core brand, DocMorris, accelerated really rapidly last year and grew by more than 20%. So this shows a clear proof point for the successful execution of our brand strategy that we have defined at the beginning of last year. At the same time, our sub-brands, Medpex and Apotal were managed well and kept at a slight growth, contributing positively to the overall platform performance. Let's deep dive a little bit in the 2 parts of the digital services, as a TeleClinic, the telemedicine platform and the Retail Media business. TeleClinic first. The number of treatments in 2025 was 2 million, which is a growth year-over-year of more than 50%. A patient in an average had a doctor on the screen, in the app within 5 minutes.

That's amazing. Imagine how long it takes until you have an appointment and you see a local doctor if you have an emergency. TeleClinic is available 24/7 with GPs and specialists. And almost half of all the treatments have been done outside the opening hours of the doctor practices that shows the importance of this telemedicine pillar as part of the health care of the standard health care in Germany, but also in other countries. As said before, so the number of doctors already reached more than 6,500 and is continuously growing. But the most important and the key success factor for TeleClinic is the strong partner network, which is secured by long-term contracts. It's with insurance, digital health providers and doctor associations. To expand this partner network is the most important key strategic priority in TeleClinic also for this year and the years after and also expanding the services they give to these partners, be it insurance companies or doctor associations.

In 2025, TeleClinic achieved a revenue of EUR \26 million. But please be aware, this EUR 26 million, that's not comparable with retail revenue. Retail revenue with relatively low margins. Here, we talk about take rate revenue with much higher margins and a complete different value. TeleClinic is the leading platform for statutory and private health care in Germany. And telemedicine is a key pillar also for the new ministry in Germany. It's part of the coalition agreement. And now as they are preparing the digital -- the new digital strategy, so TeleClinic is part of the primary care, but also of the emergency care solution of the future regulation. You see it's still a huge potential for telemedicine in general.

The market penetration of telemedicine is still below 0.5%. So we are still at the very beginning and already now EUR 26 million of take rate, mostly take rate revenue. In '26, we expect a mid-double-digit revenue growth and a further increase of the EBITDA margin. Our Retail Media business, we started with it 3 years ago, and we are meanwhile the leading retail media health care platform in Germany. We could prove to the advertisers and their brands, the brands you all know that by using our retail media platform, they can strongly increase engagement and strongly increase conversion and achieving really attractive RAS metrics. Last year, -- with Retail Media, we generated a double-digit euro million revenue with really high margin, even higher than with the telemedicine platform.

And also in the upcoming years, '26 and further, we expect continued strong and profitable growth of our Retail Media business. So let's come back to the health companion, where we have launched our AI Health Assistant in last October in the app. Right now, we are rolling it out in all our web applications. So during March and April, you will see more and more visibility of the assistant also in our web. The health assistant is the central intelligence of our platform. Here you see on this slide, Slide #17, 3 specific use cases of our health assistant. In the area of the transactional AI commerce, we integrated conversational intelligence in our search bar in order to give personalized responses and recommendations to every customer and patient using our app. In the center, you see the AI assistant, providing AI-generated advice-oriented insights and becoming more and more a trusted health adviser for our customers and patients.

And on the right-hand side, -- the assistant acts as proactive health orchestrator, seamlessly guiding the user, for example, from having a symptom to a doctor, be it the local doctor or a telemedicine doctor from TeleClinic, of course, or guiding them to a skin check service. And there, by the way, within only 2 months that we have this service live, we could detect already more than 200 skin tumors and melanomas with our service and our digital health assistant. So by managing health in one place as we do, the AI assistant helps to maximize the patient and customer lifetime value and accelerates our transition to a digital and AI health platform.

So on Slide #18, we are really very proud that today, together with Google, we could announce an incredible strategic partnership. We have chosen Google in order to leverage on their cutting-edge AI capabilities and infrastructure. Google has chosen us in order to combine their most advanced technologies with our deep digital health care and pharmaceutical expertise. Together, -- in this partnership, we are defining and delivering new seamless health products in the future in order to make health care better and more accessible.

One point which was really important for us and which we secured is that we keep the full sovereignty of our data while meeting also the highest requirements for data privacy and security. Let me conclude this first part with the strategy and the business update. We have spent the last few years in building this platform engine. Now we have started to drive it. Our strategy is set. Our positioning is unique, and our priority is on relentless execution, just to unlock the full value of our DocMorris platform.

And with that, I would like to hand over to Daniel for the financial update and the outlook.

Thank you, Walter, and also a very warm welcome from my side to the people here in the room and the ones on the webcast. First of all, I want to provide you with some further insights on the financial performance of '25, but then much more important also to provide you with the outlook and the guidance and specifically how we will achieve EBITDA breakeven in the course of '26 and then subsequently, free cash flow breakeven in the following year, meaning in '27. Let's start with a quick look back on the financial year '25. As Walter already have mentioned it, we could secure comfortable and good top line growth of 11.1 percentage in local currency.

And I'm very proud that all the business lines have contributed to this growth. Of course, Rx and Digital Services had the lion's share of the growth with Rx growing more than 33% and digital services above 110%. Reported revenues, which are the revenues without Apotal showed even a better performance and grew with 12.4% in local currency. There, you already see that the growth of Apotal was below the average of the group and also to a small part, also the growth of the segment EU. I'm very proud also that the gross margin of the group increased by 90 basis points to 22.2% despite the reallocation of marketing expenses from marketing into bonus and co-payment, which had an impact that will be directly deducted from sales and therefore, has a negative impact on the gross margin.

And therefore, the 90 basis points are even more remarkable. As you know, we only started with the co-payment and the bonus basically from Q4 onwards and until Q3, we did a lot of additional upper funnel marketing spend. Let's quickly deep dive into the 2 segments, where I will focus on segment Germany because that's the lion's share of the contribution. You see segment Germany a growth rate excess of the group of 11.7% also fueled by Rx and digital services.

Even here, the gross margin is even developed a little bit better, 10 basis points more with 100 basis points in addition and that also with the reservation that the payment of bonus and the co-bonus will have a negative impact on gross margin, but will then be reversed on the CM3 level contribution margin 3 level because it's just a reallocation of direct marketing spend to bonus and co-payment. Segment EU, a modest growth. I think we would have expected a little bit higher growth, but they managed also to improve the gross margin by 40 basis points. But unfortunately, given the low growth and the indirect cost base that didn't manage then to have a positive effect on the EBITDA level, while that's the reason why that segment EU is still slightly EBITDA negative.

With that, let's come to our KPIs, which all look very promising and which kind of pleasant in our view. Let's start with the active customers. For the first time, we have also included the TeleClinic customers because that's a significant number of customers. But let's, first of all, stick to the online pharmacy customers, which showed a substantial increase of 700,000 from 10.3 million to CHF 11 million. You remember Walter said told you that the discontinuation of the Zur Rose brand, and you can assume that a few hundred thousand customers have been lost.

We have not adjusted for that. And without that, the number would even look better. But we are very pleased what we see here. Also, TeleClinic increased the customers on the platform by 300,000 from 0.9 million to 1.2 million, and both numbers are on an ongoing basis, increasing. Also in relation to the app downloads, I think there's an active tracking of the app downloads.

I think it's an indication, but definitely not the one and only. But also here, you see a decent increase of 200,000 app downloads compared to '24, and we reached 2.1 million app downloads in '25. Now let's come to the average order values or the basket sizes. First of all, on Rx, you see an increase of EUR 4, which is by itself already a remarkable increase. But you have also seen a few slides before that in Q4, the average order size was EUR 128. And you see really that in the first 3 quarters, the average basket size was much lower compared to Q4, where we really started our efficient and dedicated marketing, and that also tells you something about the quality of the newly acquired customers.

One remark, please note that our basket size is calculated excluding VAT -- just for reasons, if you compare other baskets, you always have to make sure that if it's with or without VAT, given that the VAT in Germany is 19% that makes pretty some difference. If you gross it up our basket, then it would be much higher than the [ EUR 114 ]. On OTC, Walter mentioned it, we focused also on economic and customer lifetime value and the economy of the customers. Therefore, slight decline from 42% to 41%, but basically almost stable and nothing to worry about it.

The order frequency also here, good development from 3.9 to 4.0x. OTC remained flat with 2.0 orders per year. The repeat order rate, which was already extremely or very high and decently high at 76%, further increased to 77%, which is also a very good value. And just all in all, shows the quality and the quality of our existing, but also of our new clients, which we have acquired during the last year. Now let's quickly talk about a few highlights or perceived lowlights based on the first reactions. I do not want to go you through line by line through the whole P&L. I think the top line and gross margin, we have discussed.

Let's focus on the different cost pillars. Personnel expenses, there, I'm very pleased we could lower the respective ratio by 50 basis points. That's the first -- showing the first positive impact on our managing the indirect costs, which are basically to 100% personnel costs, but also shows the improved efficiency where we really go through the processes and kind of automatize and also using KI to better allocate resources, and that has already a very nice impact in '25 on the personnel cost ratio, and there will be some much further leverage in the coming years. Marketing expenses, as mentioned, rose by over CHF 11 million. And there, we are talking only direct marketing expenses.

We have said we shifted basically from direct marketing, not completely, but partially to indirect marketing, which you see as a decline or lower revenues. And therefore, it's not only the CHF 11 million, but you have to add a small single-digit million to really see the full additional marketing impact, which has been done in '25. Distribution expenses, there, the ratio unfortunately went into the wrong direction. On an absolute level, that shows the increase of the -- the orders, which come with higher distribution costs. But on top of that, we have seen a substantial increase of logistic costs, transport costs, given kind of the high demand for logistic services, but we think that, that should be come to an end.

And otherwise, if it will be ongoing, and we have already started with that, that we have to pass it to the clients with different models that either they pay for earlier delivery or other models just to kind of compensate for any potential further distribution and logistic cost increases. I think reported EBITDA was CHF 1.6 million lower than the adjusted EBITDA, where the adjustments come from. We have a net restructuring cost with the closure of -- that's net minus CHF 1 million because we could also sell the property, and therefore, it's only net minus CHF 1 million. We also adjusted CHF 2 million positive EBITDA contribution through the sale of the Swiss properties. And then we made additional provisions for legal cases in the magnitude of CHF 2 million. I think in our business, that's business as usual and nothing to worry because you notice that every second week there, someone is kind of putting a claim against the online pharmacies.

And therefore, we have kind of just for the corporate practice some legal provisions in the amount of CHF 2 million. On the net financial result, that also seems to be kind of going completely into the wrong direction with CHF 12 million additional net financial result. But just to call you down, it's the CHF 12 million are all noncash. It's CHF 5 million FX impact on our intercompany loans. You know we fund those in Swiss francs and give the intercompany loans in euro to our companies. And at the end of the year, we have to kind of compare it then with the actual euro value.

And as you all know, the euro substantially devaluated against the Swiss franc. There, CHF 5 million from that side. And last year, we had a positive effect of CHF 4 million. If you add it up, then you are at CHF 9 million. And the other CHF 3 million, which would then add up to the CHF 12 million, and that has a cash effect, but it will level out. That was the early repayment and repurchase of the '26 convertible bond because, as you remember, the offer was 103.5%, and we had to take that as a financial expenses. But on the other hand, we will save more than the CHF 3.5 million in this year because we do not have to pay the coupon of 6.875% of the '26 convertible bond anymore.

So therefore, if you deduct the CHF 12 million, basically exactly the same net financial result. And just for your information, going forward, we have now redeemed the CHF 26 million fully 250 million outstanding, 3% coupon, 7.5% and then you have to add CHF 4 million to CHF 5 million of IFRS 16 financial expenses, and that brings you to roughly CHF 12 million of real cash out interest financial expenses for the coming future. Also on tax, you have seen we have not paid, but recorded CHF 12 million tax -- negative tax burden. Also there, no cash at all. There's 0 cash has gone out. It must be also somehow logical because we have recorded still a loss. The reason for that is that the deferred tax assets where we have tax loss carryforwards of several hundred million.

And given a little bit lower growth in Rx and in some of our subsidiaries, that's just a manual thing, and we had to devalue the deferred tax asset, the positive ones, and that was this booking of this CHF 12 million, no cash effect at all. And given that it's based on a 5-year plan, the next year, we most likely have to do it the other way around, and then you will see there a positive contribution, but also with no tax effect. So far to the P&L, the balance sheet, I keep it very short. I think as a CFO, I'm very relaxed with this balance sheet. It has been substantially strengthened in last year with the rights issue in May, but then also with the partial refinancing of the '26 convertible bond so that we now have a very strong liquidity base of CHF 160 million.

The net debt has been reduced to CHF 138 million and the equity ratio, which was strong already before, is now even stronger and amounts to 50%. As you may have read, we had redeemed the remaining CHF 22 million of the '26 convertible bond by beginning of March. And that's what I said as from now on, we only have the CHF 50 million and the CHF 200 million convertible bond outstanding, which are the only financial and interest-bearing debt besides the CHF 4 million to CHF 5 million lease payments, which we have also to pay on an annual basis. Let's have a quick look on the indirect cost and the net working capital.

Indirect cost, everything goes into the right direction. From my view, not -- the arrow is not yet steep enough, but it will definitely steepen 7.2%. That's nothing you can be or I as a CFO can be proud of. But as I said in the past, you can be assured that this ratio will become significantly below 5% in our midterm plan, and you will see on an annual basis, further improvement on that area. Net working capital, also there, maybe -- that's because the liquidity position was so comfortable or is so comfortable, maybe not that focus by the end of last year. We had some overstocking of CHF 11 million, but that was based on a very strong Q4, which already started by the end of Q3, and we had really to overstock and the flu season also was kind of skewed towards the end of the year.

We have done it a little bit too much. I think definitely CHF 5 million could have been less stocking. And then what's kind of -- I do not like very much is the CHF 9 million accounts receivable there, let's call it, sloppiness and I take it on my part, but that is also a nice asset to reverse in this year and the coming years. So far, everything on the cost, net capital and indirect cost side on track. And now let's go into details how we will achieve EBITDA breakeven in '26 and then subsequently free cash flow breakeven in '27. And we heard some complaints that we have now introduced CM3 contribution margin 3. I would say, okay, maybe the analysts have not yet in the spreadsheet, but I think it's the highest transparency you can really get from our end and what is CM3? CM3 is the last line of operating profit.

You only have to deduct indirect costs and then you are at EBITDA. And I think that's definitely kind of, in our view, how we steer the company and how we -- and that's really the basis and the fundamental of our target and our mission to become EBITDA breakeven, and that's the reason why we want to share that with you. As you can see in '25, and you see the value of digital services, basically 3/4 or even more than 3/4 of CM3 contribution came from digital services, while the online pharmacy, that's Rx and OTC, BPC, including EU are keeping up substantially in the second half. That's the green part of the bar. For '25, we are very open and nice and even put the number on it, slightly grounded, but nevertheless, a very good indication. And then you see where -- why we are so confident that we will reach EBITDA breakeven.

There will be a substantial contribution from digital services. As you know, they grow top line. And as Walter said, it's basically take rate equals gross margin, more or less the slight reduction equals EBITDA. But also the online pharmacy is substantially keeping up in '26. You see that the green bar, and they are almost on an equal level in absolute terms with digital services with the CM3 contribution, okay, they are on the top line much bigger, and that should not be a surprise. But having said this, in '26, even Rx, and that's really exceptional, will be CM3 positive. That's due to our very focused and increased marketing efficiency, which has been substantially double-digit negative still in '25.

And you see the same pattern goes on for the first half in '27 and the first half '22. We will increase the CM3 margin by more than 300 percentage by 3 percentage points and more than double the CM3 contribution in absolute terms in 2026. And you see there will be -- there's not the end that will be ongoing also into '27. I think that's really important because if you now have CM3, you deduct the indirect cost and then your EBITDA level. And how that looks, we go even further into the detail on the next slide.

That's the -- that's really kind of to the heart of what the CFO usually not any longer in Excel, but in sheets keeps and does not share with anyone. But here, you see the phasing of our EBITDA ramp-up. The basis is Q4 '25. In Q4 '25, we had still a negative EBITDA, but it was in the area of minus CHF 7 million, which is a huge positive development due to the rights issue, we had to report Q1 '25 EBITDA, which was minus CHF 16 million. Q4, we were down at minus CHF 7 million.

And Q4 is really the run rate for our journey -- EBITDA journey in '26 with Q1 being somewhere in the area of Q4 because we see the same trends, the same patterns, the same dynamics, improvement in Q2, which is usually the first 2 quarters are not the best ones. It has some seasonality in our business, but not too much because there is additional measures included. Then Q3, we are, at this point in time, confident that we will reach EBITDA breakeven and Q4 will then be EBITDA positive. And this altogether, you will see first half the lion's share of the negative EBITDA contribution and the second half of the year, there we will hopefully see kind of a positive EBITDA contribution. And that leads us -- that's a little bit that will come now later to our guidance, but you see that it's minus CHF 10 million to minus CHF 25 million is our guidance for the EBITDA. As I said, -- it's CM3, that's the bridge, the minus CHF 48.2 million. Then the CM3 contribution, I said more than double. That's -- we haven't put the numbers there, but you also have something to calculate.

And then the indirect costs where we are really working hard and try to bring them down, but that's according to budget, still some negative contribution, and that will lead us to the EBITDA guidance, which you see on the screen of minus CHF 10 million to minus CHF 25 million. I think CM3 is a very important pattern to get there, but also in combination with operational and marketing efficiency. And then we will also very tight CapEx management and also on the indirect costs. You see we have many layers where we can play and really optimize to get -- to achieve our target, first of all, in '26 to become EBITDA breakeven in the course of '26. But then with the same patents and instruments, we will become free cash flow positive also in the course of '27. That brings me now to the guidance for First of all, for '26, the short-term guidance, we have pretty broad guidance on the top line, mid-single digit to low teens.

Reason for that is that we achieve EBITDA breakeven also with relatively modest growth, which is more the left side of the mid-single digit. But we also see patterns that we could even become EBITDA breakeven with accelerated growth. And that's the reason why we just want to keep the flexibility to play EBITDA versus growth, especially on the marketing side, and that's one explanation for the rather broad guidance. And as you know, we try to definitely come out at the right end of the guidance. But given, let's say, the different patterns, we will then have to narrow it during -- in the course of the financial year '26. As a soft guidance, how does that translate into kind of the business segments? Rx will be around 20%, which is kind of basically in line what Walter showed before.

We cut the 20% noneconomic customers that comes with kind of a little bit lower but much more profitable growth on Rx. OTC, we stick to the mid-single digit as we have been before and as we have demonstrated that, that's possible. And digital service, there we will see mid-double digit growth as digital service combined and with a substantial increase of the EBITDA margin of the already very high EBITDA margin, but there will be further appreciation of the margin. I talked about EBITDA, minus CHF 10 million to minus CHF 25 million. That's kind of -- that also needs to be said an improvement of 300 basis points or 3 percentage points of the EBITDA margin. That's coming from the wrong direction, but I think it's still substantial, such kind of relative increase. And then CapEx, roughly CHF 30 million, maybe rather at the high end and we are positive that could be maybe slightly lower as we have seen in '25 with CHF 27 million.

That will lead us to our ultimate goals, EBITDA breakeven and free cash flow breakeven in '26 and '27. And with this 2 years, taking into consideration that we have to really drive profitability, maybe a little bit against growth. The midterm guidance, we are very pleased that we basically can confirm the midterm guidance, which we put out in -- ahead of the rights issue. Of course, it's not 20% CAGR anymore. It's 15% CAGR anymore. But I think the most -- the best or the most impressive thing in my view is that we can keep the 8%. We can even stay more behind it because given that the relative growth of Rx goes down, and that makes the relative weight of digital service even bigger at the back end.

And therefore, the business mix is really in favor of us with kind of having OTC, which is very important also for customer acquisition for Rx, but also for our TeleClinic and Retail Media business. Rx, which is decently growing and then digital services with high EBITDA contribution and high growth, which will have a higher relative share at the back end of our 5-year business plan, meaning that this is true for 2030, basically covering 5 years. CapEx has also been reduced by CHF 5 million. I think we are comfortable with CHF 30 million average CapEx rate. And I think that's basically the guidance where we are -- what we are aiming for and where we are kind of being measured to.

And before I hand over to Walter because he's already jumping up, just 2 subsequent events, which you have seen on the convertible bond, I've already talked about. The closure of Ludwigshafen, which we announced also today, just some -- I cannot say, highlights, but some financials to that. We will have onetime restructuring costs between EUR 3 million to EUR 4 million. If you take the midpoint, then you should be at the right spot. But these are we are talking euros. Out of this [ EUR 3 million ] to EUR 4 million, EUR 2 million have an impact on EBITDA because these are severance payments and the remaining part is below EBITDA. That's kind of onerous contracts because we have lease agreements which we have to -- due to IFRS immediately to write off, but that will be an impairment between EBITDA and EBIT.

We will adjust for that, roughly EUR 2 million. But I think the very positive effect is that we will have at least from '27 onwards, EUR 2 million -- in excess of EUR 2 million annual recurring savings because we are moving the 3.5 million parcels from Ludwigshafen to Heerlen, where we have ample of capacity. There will be better capacity utilization in Heerlen. The handling and packaging is 2x more efficient than in Ludwigshafen because we are in Helen fully automated. And therefore, I think the EUR 2 million is a baseline annual savings, but there is definitely potential for more to come. And then last but not least, current trading, I said, we have seen the positive trend from Q4 ongoing in Q3. Everything is according to plan, meaning budget. And also, I think that gives us a lot of comfort to kind of handle and managing this challenging but very exciting times ahead of us until we are free cash flow breakeven. Thank you very much for your attention, and I'm happy to hand over to also again.

Yes. Thank you, Daniel. So just before we close and open the Q&A session, -- in the last 2 years, we have not only built the platform engine, as shown before, we have also built a high-performing leadership team, as you can see here on the slide, a leadership team that bridges the gap between traditional retail excellence and disruptive health tech and AI innovation.

And I can assure you also in the name of the whole team that we are fully committed to execute the defined goals and to transform our platform into tangible shareholder value. It's not only at the level of the management, it's also a change which is mirrored at the Board of Directors. And therefore, we have informed that we nominate 3 new members of the Board that we will present to the AGM. It's Thomas Bucher, a well-known, seasoned CFO with a lot of experience in listed and private companies. It's Nicole Formica-Schiller. She's an expert in AI and digital health transformation, but also regulation on a European and the German level.

And she has also a wide network in Germany, in the health care sector and a deep understanding of the regulatory landscape in Germany. And it's Thomas Reutter, an experienced corporate and capital markets lawyer. So these board nominations ensure that management and Board is perfectly synchronized with the company's vision and AI-first platform strategy and also shall provide the necessary stability to the company.

And with that, we are at the end of the presentation. We had to tell you a lot to give you a lot of information. But now let's immediately move to the Q&A session.

[Operator Instructions]

Okay. We will share the mic.

Here is Laura Pfeifer, Octavian. I have a question on your sales outlook for this year. So what is the primary swing factor within your guidance range? Is it mainly driven by uncertainty around Rx growth? Or is it rather related to OTC performance? And maybe specifically on OTC, could you elaborate on what you are currently observing in terms of competitive dynamics?

To the first and second part.

No, I think, Laura, the swing factor is definitely Rx, which -- and as I said, we have kind of -- we play operating profit against growth. And given that the co-payment and the bonus, which have been developing not in the entire group because we only did kind of a pilot with some selected Rx customers developed very well in Q4, and we rolled out kind of this concept to the whole DocMorris just recently. That really is kind of the swing factor and also the reason for the wide range of the guidance.

I think you can assume that OTC, BPC, that's the mid-single digit, meaning something between 3% and 7%, not much deviation. Also, the absolute volume is high. The digital services, double-digit -- mid-double-digit growth and -- but on a relatively low revenue -- absolute revenue level and the swing factor is really Rx, whether that's kind of let's say, 10% or 40%. But that's not that you take that as just to show you what kind of the volatility could be on Rx.

Yes. And you mentioned the competitive landscape and the price pressure. I guess you meant there, in the course of last year, we have adapted our pricing strategy, improved our strategy. You have seen the improvement in the gross margin. That's a result of it. But in general, we don't see now a change on prices or price levels in the market. In our market, pricing, the pressure is always on, but not now a big change with new market entrants coming in.

Urs Kunz Research Partners. Regarding midterm, is that around 2030. And then on your midterm growth target of 15%, I still find that a little bit high, the OTC part is growing at mid-single digit, I guess, in your outlook in midterm. And I guess on the digital service side, I don't know if you can have this mid-double-digit range also percentage range all the way in the midterm future. So that -- if I then go back to the Rx that should be higher than 20% Rx growth to reach this 15%. Am I right about that?

Yes, you are perfectly right. And I think what you need to really consider given EBITDA breakeven and free cash flow, as said that we have to limit the growth and really play on our marketing efficiency. And that's also why we stated in the guidance that the fine print in the [indiscernible] that it's back-end loaded in '26 and '27, you will definitely see lower Rx growth than what will then come again from '28 to '30 onwards. And if you said it's substantially about 20%, and I will -- I can sign into that. But it will be 20% in the first 2 years, but then we will substantially be keeping up again.

And where do you take how this belief that it's higher than 20%. It's just that you put in more marketing again then or you see the market growing faster after 27% in online?

Yes. I think it's really kind of the -- that we then have other or once we are free cash flow positive, we can then really also not that we fall back in the old patterns that you won't see then kind of us spending all of a sudden CHF 30 million in TV again. But I think with the bonus and the co-payment that's a very strong instrument. But as said, at some point in time that you are in balance with growth and profitability, we have, for the time being, still certain limitations and there, you can definitely kind of play that even more aggressive.

And sorry, what we also will see is a platform dynamic kicking in. So you have seen the partnership also with Google. So where we have joint development teams also with them, developing new services, adding services to the platform. And this will drive traffic, will drive engagement, will drive loyalty. So we will see the effects there definitely within even 1 to 2 years already.

Midterm is 2030 or?

2030.

Sibylle Bischofberger, Bank Vontobel have 2 market questions. First, I remember the market share of online pharmacies was about 5, 6 years ago, about 1.3% in Germany. How has it developed? How much is the market share now? And how much do you want -- how much growth do you expect in the next couple of years? And the other interesting market, telemedicine, you mentioned 0.5% market share. Where do you expect it to be in the next couple of years?

So on the Rx, yes, it was 1.3 5, 6 years ago. It went down before eRx started to 0.75%. And since eRx was available now also for online pharmacies, it went up to roughly 1.7%. And where will it go? That's the 1 million question. So we have, for our assumptions, taken a really conservative view in our midterm plans of 5% to 6% in 5 years. But frankly speaking, we think it will be more. It will ramp faster. But in our plans, we did not go now more aggressive than 5% to 6%.

And on telemedicine, so yes, the share as shown, the penetration is lower than 0.5%. TeleClinic is roughly at 0.3% so has about 60%. And where will it go? So it depends on how fast the digital strategy of the ministry will be defined and will go live and how prominent telemedicine will be in this different kind of future care pillars. And it's too early to say where it goes. But anyway from 0.5, it will definitely go northwards, definitely. And remember, it's -- we have 2 kind of businesses. We have a retail business, but we also have a digital service business with completely different metrics, valuation, et cetera. And there is a strong growth really already going on and will continue.

And I think if you are interested, I recommend you to read Page 175 of our financial report where all the details in relation to the goodwill impairment is, which we honor past. But there you have kind of the assumption, the current market share of telemedicine and Rx and what our underlying assumptions are. It's in Rx 1.7% and in 2030, 5%, 1.7% to 5%. And that's the overall market share. I think then for the whole market. And telemedicine, it's even more astonishing, 0.5%. And in 5 years' time, the penetration should be 1.6% -- that's what we base our goodwill impairment test, and you could also assume that, that's basically then somehow reflected in our business plan.

So no more questions here in the room in Zurich. So let's move to the webcast and adding questions from there.

We have one question from Gian Marco Werro from ZKB.

Yes. Hi, Gian Marco. Please go ahead.

Hello. Thank you. I hope there's no echo on your side. So first question is the growth outlook for TeleClinics. You mentioned mid-double-digit revenue growth. Why not 80% or 90% again this year because the penetration is still so low? Do you not do more marketing also there? Because in my view, it's really so such a comfortable way to get a doctor appointment in Germany, and there must be a huge demand from the doctor and from the patient side. So from a top line perspective. And then the profitability of the overall services business, is that still fair to assume that you are meaningfully above the 55% EBITDA margin for this business?

And you mentioned you want to increase the margin for TeleClinic, but can you give us a bit more detail about your margin improvement target also for the whole services business, that would be interesting. And then just a third question, if I may, if I have the opportunity, the logistic cost is just something -- I mean, you already elaborated on it. But don't you see risk of patients ordering then less or if they have to pay really then for even more for the delivery services, especially considering your growth expectations in Rx and OTC.

To the first question, the growth rate. So you can consider that the growth in absolute values remains at more or less the same level. And then you have to take in consideration that you always have to integrate new network partners, larger ones. And once you integrated them, the growth curve starts to slow down and then you integrate new ones. At the moment, the regulator is justifying the new digital strategy. And for example, the doctor associations -- we talked to several of them. They are ready, but they just want to wait until they know now what the regulator regulates -- and so this is the dynamic of the growth that we have predicted for this year. If it comes to the margin, you mentioned 55%. So some of the services are even higher. Some of the services are below this 55%. And I think -- yes.

I think on the margin, not sure where this 55% are coming from. I think as of currently, TeleClinic has margins in the low 30s that will substantially increase over time over the next 5 years to the figure you -- you mentioned, I would say that's kind of 45%, 50%, that's kind of a reasonable run rate. And on the other hand, Retail Media, that's also very highly profitable. That one is already on higher EBITDA margins, but will also kind of in a balanced model will be somewhere around 50% EBITDA margin. And I think that's the mix.

You will see this year an overproportional increase of EBITDA contribution given that we do not have a triple-digit growth at TeleClinic. And I think it's always kind of 1 year, a little bit less growth, but then substantial improvement of profitability. The next year, strong growth, maybe a little less profitability than 1 year of consolidating everything, increasing margin. And I think that's -- but the overall pattern and growth pattern is very strong, but it's not a linear line. It's kind of some years with a little bit hold back on the top line, but push the bottom line and therefore, even faster.

And your third question about logistics, do you refer to what to the closing of Ludwigshafen or...

No, to the logistic costs. And I think there, Gian-Marco, it's not that we say, I think we do it a little bit more professional, not saying that you have now to pay EUR 2 more. I think you have definitely other measures. First of all, kind of not reducing, let's say, the order that you can say, okay, if you order until 5, you get it next day, you can even lower your logistic cost if you say, okay, if you order until 4, then you get it next day because that has already another price tag on the -- with the carrier.

And you could also play then with the basket size, which is kind of then free of shipping just to balance this logistic cost. And we see it in the whole market. You see, for example, DM free of delivery charge is EUR 60, our friendly competitor and -- and thus, we are much lower. But I think you have many things to play and to optimize your logistic costs. And it's not a problem of DocMorris, it's kind of the whole online and not even Rx and OTC online, but the online industry, and we will just follow the market and to not getting -- being hit by higher logistic costs.

And we have one more question from Jan Koch from Deutsche Bank.

Two questions. The first one is on your 2026 guidance, which essentially only implies less than 4% sequential growth per quarter. Why is this the case? And given that your group guidance is quite wide this year, is there a scenario where you accelerate Rx growth in 2026? And then secondly, you mentioned a strong liquidity position of CHF 160 million. But if I take the CHF 160 million at the end of 2025 and consider that you paid back the CHF 20 million convertible and consider a negative free cash flow in probably in the mid- to high double digits in 2026, you will start 2027 with probably less than CHF 100 million.

Free cash flow is still expected to be negative next year, and you might have to refinance your 2028 convertible next year as well. So how do you plan to achieve this? Are you open to sell a minority share in TeleClinic?

Yes. Let me take the first question and then Daniel, the second one. So on the sequential growth, as we have shown before, the guidance, we have given us some space so that we can maneuver between growth and marketing spendings. And this is also what we see in the first quarter that it goes in a really good direction already. And -- if it continues like this, so we can go more to the upper end, but we want to be flexible in reacting. And for us, the priority this year is completely on becoming breakeven in the course of the second half year, possibly on the second half year in total. And therefore, we need this flexibility and we take for us this flexibility. And on the second question.

Yes. I think just to start top down, you're right with the CHF 160 million, you have to deduct the CHF 20 million or CHF 22 million, but let's deduct the CHF 20 million, that makes it easier for calculation. That's CHF 140 million. And you are also right that you can assume for this year and next year, negative free cash flows, but they will be substantially even already this year lower than last year and in '27 that the indication that in the course, of course, we aim for as low as possible negative free cash flow, but that should be not kind of the 2 figures added up should still leave us with a very comfortable remaining cushion of liquidity until we will become then for the full year free cash flow positive in '28.

In relation to the refinancing of the '28 maturity, I think once we have demonstrated and shown that we are on the right path, -- that's then something which we will tackle by then. It's clear that we do not fully redeem the CHF 200 million, and it's also clear that it does not make sense from just -- at least that's what I learned at university, okay, acknowledging that was some time ago, but that the fully debt financed balance sheet is definitely not an efficient balance sheet. And I think let's take it one step after the other, and we have ideas. And you referred to kind of -- if I'm right, selling a minority stake of TeleClinic. And I think, of course, that it's a very valuable asset, which we have in our hand, but it's extremely valuable within our platform and therefore, definitely not any or the first priority to monetize TeleClinic at this point in time.

Understood. And one follow-up, if I may. Are you going to report EBITDA in Q3 and Q4 this year again so that we can track your progress?

Let's see. I think could well be. I think that -- and I think it would be important that at least we give you a very good indication where we are heading to. And I think this nice picture, which we draw in our presentation, you can basically on a quarter-by-quarter basis, track us and see whether the 2 guys in front of you have not only overpromise, but also deliver on that. But we have to see, but most likely, yes.

Okay. Then we come.

I just want to say that's the benefit of lunchtime.

Last question.

Not going to look. No. On the AI companion digital assistant. As I understand, you're not getting any money for it. Marketing and any plan that on later stage you get some money out, because you mentioned these 100 people they got saved from cancer. At the end, I think somebody is happy to pay something..

Did anybody say we do not get any money out of it? I cannot remember. No, it's what we see and we measure very carefully, of course. We see an impact -- a positive impact on traffic already. We see a positive impact on engagement already. We see the conversion rates going up as soon as we can take someone by the hand and guide through the platform. And we see a significant increase of conversion rate. And this brings us already additional money. And as you have seen on the platform, the marketplace, this marketplace is a marketplace also for health services.

And on a marketplace, you want to earn money. And we are filling this marketplace also with health services, and we will get additional margins, revenues and margins from there as well. Okay. So with that, we come to the end. Thanks a lot. It was a little bit long. Sorry for that, but we had a lot of information for you. Thank you for joining, and we wish you all a pleasant and happy day. Bye-bye. Thank you.