Kerry Group Stock

Good morning, and thank you for joining the Q&A call for our H1 2026 results and our 2030 targets. We released the presentations and management prepared remarks earlier this morning, and both are available on our website under the Investors section. I'm joined on our call by our CEO, Edmond Scanlon; and our CFO, Marguerite Larkin. Edmond will begin with a summary of the highlights from our H1 results and our 2030 targets, and then we'll open the line for questions. Before we begin, please take note of the disclaimer on our presentation regarding forward-looking statements. I'll now hand over to Edmond.

Thanks, William, and good morning, everyone. Beginning with our H1 2026 summary overview. We're pleased to report a strong performance in the first half, reflecting a step-up in volume growth in the second quarter, combined with continued strong margin expansion, driving high single-digit constant currency EPS growth. We delivered H1 volume growth of 3.3%, well ahead of our markets. Our step-up from 3.1% volume growth in Q1 to 3.5% in Q2 represented a broad-based improvement across all 3 regions and in both the retail and foodservice channels.

Growth was led by foodservice with a range of new menu innovations, seasonal launches and cost reduction solutions, and growth in retail was supported by continued product renovation activity and innovation in high-growth areas. On EBITDA margins, we delivered margin expansion of 60 basis points in H1, driven by Accelerate 2.0, net price, operating leverage and portfolio mix, with EBITDA margins reflecting progression across all 3 regions. Our volume growth and margin expansion supported constant currency adjusted earnings per share growth of 7.9% in H1.

And while recognizing current market uncertainty, we remain strongly positioned for volume growth and margin expansion in the full year, underpinned by a good innovation pipeline, and we are maintaining our guidance range of 6% to 10% constant currency EPS growth in 2026. Looking beyond 2026, I'd like to outline our new 2030 targets. On volumes, we have consistently outperformed our end markets over many years. We've set a target of 3% to 5% volume growth, and our range is set in the context of current market conditions, which I'll touch on shortly.

On EBITDA margins, we've delivered 320 basis points margin expansion since 2021 and have set our target to be in the 20% to 21% range by 2030, driven by efficiencies, operating leverage and portfolio mix. And on EPS, our algorithm is about delivering consistent high single-digit plus EPS growth, supported by agile capital deployment aligned to value creation opportunities. We've increased our cash conversion target to 85% plus and are increasing our returns target to 12% to 13% by 2030. In our prepared remarks webcast earlier, I outlined the key dynamics in the market and the drivers of our future volume growth, with Marguerite outlining our targets around EBITDA margin expansion, cash and returns.

I'm now going to summarize the building blocks of our volume growth target and then my key takeaways from this morning's 2030 targets presentation. Starting with our recent performance. We have a strong track record of market outperformance, delivering 3.8% average volume growth across the last 4 years against pretty flat end markets. We set our target range of 3% to 5% in the context of these market conditions, and not assuming an uptick in future market growth. I believe we will see market growth in the coming years, but we're taking a pragmatic approach and not factoring in something outside of our control.

We've just reported Q2 volume growth of 3.5%, which you will have seen, and our pipeline of innovation and renovation opportunities is as strong as ever. Looking at our recent volume performance and our growth target through the lens of our 3 regions. Firstly, the Americas, which is our largest region and a powerhouse for Kerry and where we see phenomenal market opportunity. We've delivered strong volume growth in recent years and are looking for volume growth to remain in that 3% to 5% window.

Next, in Europe, given the market backdrop, we're looking for growth of around 1% to 2%. And in APMEA, where we have delivered volume growth of around 6% and where we're looking for growth in that 5% to 9% range. We have 3 key volume growth drivers, which will underpin our performance. Firstly, foodservice. Where we're aiming for mid-single-digit plus volumes, having grown our business by 70% since 2017. We still see significant runway for growth given our competitive advantage, which is based on deeply embedded customer innovation partnerships, our broad technology portfolio and our dedicated business model.

Next, emerging markets, where we've delivered high single-digit volume growth over the long term and have a large global presence. Major growth drivers from a consumer perspective will be increased health and wellness innovation, regulatory developments and an increasing number of snacking and beverage consumption occasions. The investments we have made in building out our extensive local footprint and in-market capabilities gives us proximity to our customers, enabling us to provide locally relevant solutions and derisking their supply chains, giving us an advantage and positioning us to outperform across the medium to long term.

Finally, renovation, which continues to grow as a percentage of our pipeline. It's around 40% today, and each renovation opportunity is providing a catalyst for organic growth and margin expansion as we incorporate deeper layers of technology in new launches. This morning, I provided some examples in areas like sodium reduction and protein masking. We will be hosting an investor event on the 8th of October, where we will give you more color and insight into our business at our U.S. Technology and Innovation Center in Beloit, Wisconsin, and we look forward to seeing you there. So I'll finish with my key takeaways.

We have a strong track record of growth and business development. We feel confident that we will continue to significantly outperform our end markets while continually evolving and future fitting our business to ensure we remain the top-of-mind partner for the food and beverage industry when it comes to solving its most complex challenges. Today's market landscape provides significant opportunity for Kerry. Challenges are greater. Customers need to move faster to make their products better. And that is what we are built for.

Our clear market differentiation is based on our ability to deliver value for our customers at pace through our deep layered taste and biotechnology capability, along with our global innovation ecosystem across our broad customer and channel base. This provides us with an in-built business resilience, which is critical in today's market landscape where dynamics continue to evolve. Our strategy is growth led, and I've outlined our building blocks by region and the key drivers of our future volume growth. And finally, this growth, combined with our EBITDA margin expansion will be the key drivers of our high single-digit plus earnings growth algorithm as part of our balanced overall financial framework.

So with that, I pass you back to the operator, and we look forward to your questions on both our H1 results and our 2030 targets.

[Operator Instructions] Our first question comes from the line of Alex Sloane with Barclays.

I've got one on '26 and then 2 on the targets, if that's okay. So just in terms of '26, obviously, maintaining the full year guidance today. Does that imply you're still assuming around 3% volume growth for the full year? Or do you see the kind of slightly improved run rate of Q2 as sustainable into the second half? And if not, if there are any kind of key factors as to what would be driving a moderation in your view? That's the first one.

Then on the targets, thank you for all the color. So if I look at the kind of the medium-term volume targets, APMEA has the widest growth range, obviously, within the regions, 5% to 9%. And it's the region where today, you kind of delivering towards the sort of lower end of the range versus sort of more middle of the range in the Americas. So what needs to change for Kerry to sustain growth in the upper half of that range?

Is it primarily within your control? Or does it require a more stronger external environment? And then just a final one maybe for Marguerite, on the margins, thank you for the increased disclosure on gross margins and the ambition to step that up, which is welcome. I guess it's sort of a broader question on margins. Given you have a pass-through pricing model, I guess, how feasible are these targets to and how sensitive are they to a kind of more inflationary raw material environment? And are you building in some flex for inflation as a base case?

Alex, I'll kick off here. Maybe firstly, on the outlook for 2026. So we have increased our volume expectations for the year and now expect H2 volume growth to be more like our Q2 volumes of 3.5%. So this means our full year volume expectations are close to 3.5% versus the 3% level we had outlined earlier in the year. And just from a regional perspective, Q2 volume growth by region is probably a good reference point or a good proxy in terms of our volume expectation for the rest of the year.

And just to do the full loop then on EPS, as we referenced in the prepared remarks, there's no change in our constant currency EPS guidance range of the 6% to 10%, but we do expect a modest increase in our EPS expectations for the year within the range, and that's based on the increased volume outlook that I just mentioned there. Then just moving on to your question on, let's say, the medium term and APMEA specifically. Look, we outlined earlier in the year at CAGNY that we planned on building on the volume growth that we delivered in 2025 in the APMEA region with strong mid-single-digit growth in 2026 and a further growth in 2027 and beyond.

And our aim here is to deliver on that high single-digit growth. So I guess, overall, our ambition for the APMEA region actually remains unchanged. The makeup versus the past might be a little bit different in that we expect the increased growth to be led by growth in Middle East and Africa, followed by Southeast Asia. Look, we have been investing in building out our footprint, as you know, and our in-market capabilities right across the 3 subregions of the APMEA region. And it's all about executing locally, executing on our growth strategies to help customers to meet the ever-evolving local consumer needs and the increased health and wellness pull that is also in that region.

Out-of-home is also a factor as is the new and convenient food and beverage offerings. Macro dynamics are also on our side in that region in that over the next decade, there is an expectation that middle-class households will go from about 350 million to 700 million over the next decade or so. So overall, as we kind of look at the 3 subregions within APMEA, while the building blocks will be maybe a little bit different in the past, we do believe we are well set up. There's momentum in the business, and it's playing out more or less as we've expected here through the course of 2026.

And Alex, just on the margin target and the inflation question. As you say, firstly, on potential inflation, it's not easy to predict over a life cycle. We do have a strong track record of managing inflation over the years, and we have a strong track record of delivering margin expansion of over 300 basis points over the last number of years. So we have factored in some inflation in terms of our thinking on the increased target. I mean what is important here, a couple of points I would make.

Firstly, the strong track record of margin expansion delivery. The levers are clear in the context of driving margin expansion over the plan. And those are efficiencies from our Accelerate program, mix and leverage and beyond 2028 to reach the increased margin target of 20% to 21% in 2030. We see those similar levers driving the margin expansion, leverage, mix and efficiencies. I think there's a number of factors at play as we look at the evolution of the business and as Edmond has referenced. Firstly, on leverage, we see good margin expansion opportunities as we continue to outperform in foodservice and in emerging markets where we've invested ahead of growth.

And then secondly, on mix, particularly in the areas Edmond mentioned on renovation and clean label and technology and removing artificial ingredients, they're complex challenges, and they require layering of our technologies and application expertise, and that presents a margin expansion opportunity as well as growth opportunities. Thirdly, as I referenced, we will continue to deliver margin expansion through efficiencies. So it's a combination of all of those factors as we look to the increased target.

I think importantly, like we've shown in the past, -- we are balancing our margin expansion with continued investment in the business, and you'll see also that we communicated earlier today our expectation to increase our current R&D spend from 4.5% -- 4% to 5% to 5% to 6%, which is also a key part of how we're thinking about the business as we go forward and the margin expansion.

Our next question comes from the line of Patrick Higgins with Goodbody.

Kind of one 2026 question and then one on the midterm if that's okay. Firstly, just in terms of, I guess, the step-up in performance in Q2, to what extent is that just Kerry kind of executing stronger versus, I guess, any improvement in end markets? And in the sense that it is Kerry outperforming or outperformance widening, where is the key drivers there? Is it renovation? Or are you seeing a step-up in innovation? And then in terms of the midterm guidance, I guess, on free cash flow, good to see the kind of increased kind of conversion target. Maybe could you just talk us through what's underpinning that? Is it lower CapEx or kind of improved working capital or just the better margin profile?

Thanks, Patrick. I'll kick off here. I would say in terms of, let's say, our general performance here, firstly, I would say we haven't seen any notable change from an underlying market condition standpoint. So we'd be calling underlying market more or less the same as we talked about at the Q1 and at the beginning of the year. So the key drivers of outperformance, firstly, are around the renovation opportunity.

I did give more color on that on the 2030 targets there this morning. We see this as a structural market shift. And it's primarily driven by actually increased consumer expectations. There is -- continues to be supply chain challenges. There's obviously also increased regulatory developments in various markets. And ultimately, what we're seeing is that customers' need for renovation is increasing and customers are looking not only to, let's say, improve the nutritional profile, not only derisk from a supply chain perspective, not only strive to meet regulatory requirements, consumer expectations, but do all those things while also maintaining the quality of the product, the taste of the product.

They're also doing everything they can to ensure that they're not losing market share at a minimum and trying to grow market share ultimately. So that is a key element. That's not to say that there's not innovation in the market. There is -- we're also seeing innovation in the market. We've touched on it previously, examples like poultry, the protein being, let's say, a key focus for consumers at the moment, poultry being a pretty good value source of protein. We have a very strong position on poultry globally as it relates to taste and excellent relationship with the poultry processors.

Beyond that is the broader protein, I suppose, expectation from consumers. I referenced on the webcast about the desire to put the maximum amount of protein, and we've seen examples of customers wanting to put 40 grams of protein into a single serving. That is a highly complex, highly challenging thing to do, and it requires a huge amount of technical capability, applications capability, technology, and these are all areas of core competency for Kerry. Coffee is another area that is growing, refreshing beverage, especially as it relates to functionality with refreshing beverage and supplements as well.

And that's -- and we're seeing this right across actually the larger CPGs, emerging leaders and of course, retailer brands as well as they are looking at the landscape and seeing how they can grow their business. And then lastly, on foodservice. And foodservice has been a key underpin of growth for us for several years. We've had an excellent performance here in the first half on foodservice, especially in the Americas region. And foodservice over the medium term will continue to be -- we will continue to outperform retail. And we do see significant runway for growth out in front of us given that competitive advantage we have.

And that competitive advantage is not just based on one thing, it's based on multiple factors, those deeply embedded customer innovation partnerships, our broad technology portfolio and our dedicated business model that is absolutely orientated towards that channel. And I think maybe what's underappreciated is the fact that our market share within the foodservice channel is only still at the low teens. So we continue to have significant runway in front of us in terms of growing that market share, and we feel we're very well positioned to be able to take advantage of that and capitalize on that.

On your cash question, your cash target question, we have increased the cash target to 85% plus, and that is driven by profit growth and margin expansion expectations incorporated into our cash target of 85%. Firstly, it recognizes working capital investment aligned to our growth strategies and also capital expenditure of 4% to 5%, which is above -- which is in line with our current investment.

So no change on our capital expenditure of 4% to 5%. We do have a strong record of delivering roughly 88% cash conversion over the 4 years. And just in relation to 2026, we expect 2026 to be a year of good cash conversion of 80% plus for the year.

Our next question comes from the line of Ed Hockin with JPMorgan.

I hope you can hear me okay. I've got 2, please. One is broadly on the renovation opportunity that you see for the midterm. I think you say 40% of your pipeline is related to renovation. I think in North America, a figure of 60% had been given before. So I'm curious on where you see renovation opportunities developing in the rest of world in Europe and in emerging markets. And also within Americas, clearly, renovation is a reality now. But to what degree do you see over the next 12 to 18 months a building pipeline of reformulations by customers?

Should we expect that there's a pickup further to come? Or is this quite a smooth pace of renovation year in, year out? And then my second question, please, is on the return on average capital employed metrics, which are quite stepped up from the 10% to 11% level that you've been at for the past several years. So what is it underpinning this? Obviously, improving profitability is one part. But does it tell us anything about your appetite for acquisitions over the coming years?

And if you could remind us some of the spaces that you're looking at for bolt-on deals? Should we be thinking areas like fermentation, enzymes, biotech, proactive health as before and some emerging markets capabilities or anything shifted on the M&A outlook for the coming years?

Thanks, Ed. I'll kick off here. Maybe firstly, on renovation. We've sized the renovation -- our current pipeline as it relates to renovations approximately 40%, and like we've said, it's going to be a key driver of growth in the medium term, and we expect that to continue to be at that level or slightly greater in coming years. Maybe just looking back first, I mean, we have seen a significant step-up in recent years in that scale of renovation activity within our pipeline.

So maybe historically, one should think about that as approximately maybe 1/3 of our, let's say, business development activity was in renovation, if we were to go back a number of years. It does vary by geography. Like we've said previously, we're currently in that 60% zone as it relates to renovation activity in North America as we outlined. And as you can appreciate, it's typically higher in developed markets compared to emerging markets. We do expect that to evolve over time. Right now, like I said, it's the highest in North America.

That's driven by lots of things, but it's primarily driven ultimately by the consumer pull. Things like regulations and things like that, I mean, maybe just to give an update on that, the -- probably the most recent development, what we've seen is that there is more alignment between the federal government and the states that food regulation is more of an activity of the federal government. And obviously, that is a positive development in recent months that it's more realistic, I think, and encouraging development. Look, it's obviously still hard to predict exactly when front-to-pack labeling will actually be implemented in North America or in the U.S. But we genuinely believe it's a matter of when, not if.

And I also believe even regardless of that, the consumer pull ultimately is the key driver. And I think here, over time, more and more customers will start thinking about renovation. But our expectation that it will be a gradual evolution here, Ed, as opposed to kind of a big spike and a kind of, let's say, a falloff. We see customers being very strategic, very purposeful, very systematic in their approach to reformulation, ensuring that they don't do any damage to their brand and ensure that they're bringing their most loyal consumers along with them.

So that is typically how this plays out. Like we've mentioned previously, these are highly complex formulations to reformulate and do it in such a way that there isn't -- the consumer essentially doesn't -- can discern the fact that there is a formulation change. So this is typically a gradual evolution. That is what we have seen in other regions in the past, and that is our expectation in North America as well.

And just on returns, as you referenced, we have increased our returns target to 12% to 13% in 2030. And it very much reflects our high single-digit plus EPS growth expectation. While we are retaining flexibility for some bolt-on M&A under our capital allocation framework in the areas that you've mentioned, but I'll maybe pass to Edmond here in a few moments. In terms of our overall returns, our objective is continued focus on growth-led value creation and continued disciplined capital allocation in line with our capital allocation framework. Edmond?

Yes. So maybe just on a couple of points on M&A. Firstly, I think we're guiding here or suggesting here, I should say, that we're probably more in the zone of bolt-on type acquisitions. And I think in terms of areas of focus, firstly, I would continue to call out emerging markets. Despite the fact we have a strong presence, a really strong presence in emerging markets, based on, let's say, the demographic point. I mentioned previously and our expectation for growth in emerging markets, we will continue to look at potential opportunities to enter new markets through acquisition, modest in nature in emerging markets.

The second area is in the biotechnology space. So the 3 areas that will be a primary focus are around biotics and bioactives, #1; enzymes, #2; and number three, on food protection and preservation. I think it's also important to note that, that biotech capability that we've been building over the last number of years is a key underpin of innovation in our Taste business.

So we will also be continuing to kind of look at areas there where there might be some opportunities to continually to evolve our capability in the biotech space as it relates to taste, albeit we believe that will be more orientated towards in-house innovation programs and is the reason for that uptick in R&D investment over the medium term that Marguerite already mentioned.

[Operator Instructions] Our next question comes from the line of Nicola Tang with BNP Paribas.

First, I wanted to ask a little bit more about margin drivers in the midterm. When you -- Marguerite, when you laid out those kind of 3 drivers, operating leverage, mix and efficiencies to 2030, should we assume an equal contribution from each? Or is there one factor that's driving more of that margin expansion? And then a linked question, when we think about the regions and the profitability across the regions, is it realistic to think that they can converge over time, i.e., is the biggest margin upside opportunity in APMEA and Europe, which are currently -- which is -- sorry, currently lagging the Americas?

And then maybe on a second topic on foodservice, I know you touched on it a little bit earlier. You talked about having a low teens share of the addressable market. I was wondering, do you see any change in terms of the competitive landscape, given that this is clearly an area of growth and it's historically been an area of differentiation for Kerry. And you talked a little bit about kind of what differentiates you in terms of your investment and business model, but perhaps you could share a little bit more details around why you're confident that you can at least defend, if not grow that market share.

I'll kick off here maybe on your foodservice question first. Look, I think at this moment in time, we wouldn't be calling out any change in the overall foodservice landscape. I think it's important to note that this is a space that we've been very active in for 15, 20 years at this moment in time. Over the years building up a significant investment of people, capability and competency as it relates to the foodservice channel and building a dedicated capability around that foodservice channel, where we have expert capability in terms of actually engaging with customers in all aspects of the menu.

So that is a really important point. I would also say that the relevancy of our portfolio to the foodservice channel is really important as well in that it's a key driver of that engagement with customers. I think the relationships that we have and the reputation that we have of being that go-to innovation partner for the channel is also another really important underpin. I mean the foodservice channel is broad, and we have deployed various strategies to subsegment that channel to be able to cover the breadth of that channel, all the way from independent operators to the largest of global customers with tens of thousands of stores.

And we're able to support them on a global basis or on a local basis, right across every aspect of the menu. We've also built a strong capability as it relates to the LTO support. This is -- can be very challenging from a supply chain perspective, but we have the processes and capabilities in place to be able to do that as well and to bring LTO concepts to customers at pace. And also to be able to execute flawlessly on those -- on LTOs, which is a crucial aspect of their business as it relates to targeting that occasional consumer to walk into their stores.

So I think we feel pretty confident about our ability to not only defend and for sure, we don't take anything for granted, but also to grow and to grow at a pace within the foodservice channel. And I think our performance reflects that, bearing in mind that the foodservice traffic continues to be flattish year-on-year. And in the quarter, we delivered 5% volume growth. So overall, it's a space where we feel pretty good and an important underpin for growth for us here over the medium term.

And on margin expansion, in terms of the levers and how they will evolve over the life of the plan. It's fair to say we see contribution from each of leverage mix and efficiencies. I would call out an expectation that in the earlier part of the plan, we see a greater level of margin expansion coming from efficiencies through the Accelerate program with mix and leverage contributing. Beyond 2028, we do see that evolving, and we expect to see a greater level of margin expansion coming from leverage and also coming from mix for the reasons that I referenced earlier.

Then just in the context of the regions, we expect continued margin progression across all 3 of the regions. with a greater level of margin progression in APMEA and Europe versus the Americas. But we do see overall, our margins in the Americas will remain higher than the other 2 regions. And that's really driven by the scale, the strategic positioning and the complexity of customer challenges that we are solving in the region.

Our next question comes from the line of Victoria Nice with Bernstein.

So I was just surprised that with solid Southeast Asian growth, China back to growth and good Africa and Middle East, that volumes were not even more ahead of the 5.2% in Q2. I guess can you just run us through in more detail the performance there by subregion? And you say you see similar to Q2 for the rest of the year. So I just want to make sure I'm clear where -- like what area you see stepping up next year in particular? And then my second question was just on the midterm. The ROACE target, you said it assumes some bolt-on M&A.

Can you give a bit more detail here on the ROACE side potentially versus history? M&A has obviously been bolt-on historically. There's just been a greater number of deals, and that's something that's slowed in recent years, and you're kind of implying doesn't really pick back up again. So just compared to that historic run rate potentially and the key reasons for why you see that changing. I guess the flip side of that, does that mean that we could potentially get greater or could expect greater cash return instead?

Your line is a little bit muffled there, but I think we got most of it. Maybe firstly, on APMEA and how we're kind of thinking about the medium term and, let's say, performance through the year. We did say earlier in the year as it relates to our performance in APMEA that we plan to build on the performance that we had in 2025 with strong mid-single-digit growth in 2026 and a further increase in growth in 2027 and beyond. So our aim and ambition here over the medium term is to be in that high single-digit growth zone, recognizing that this will be a build over the remaining -- over the next number of years.

In terms of the 2026 outlook, it is as we have outlined. One should expect the full year outlook for the APMEA region to be more or less in the zone of or the H2 outlook to be more or less in the zone of Q2. So that's our expectation here for the remainder of the year for the APMEA region. I guess in terms of maybe just some of the changes there, China, our expectation over the medium term is more modest growth in China. So we haven't factored in China as being a key driver of increased growth in APMEA in the coming years.

The teams are working very hard to drive things forward, but we have to recognize the current market context within China. So growth will be driven, and our expectation is that growth will be driven by Middle East, Africa. It's a region, both the Middle East and Africa have delivered strong growth for us in recent years. They have been our fastest-growing regions consistently over the last number of years, and we expect that to continue. There will always be an element of volatility, but we do feel we're very well positioned.

We do believe that macro dynamics are on our side as we see customers evolving their business, investing in their businesses across APMEA, it is based on that macro dynamic that there will be more middle-class consumers consuming convenient food and consuming food outside of the home. And we have invested significantly in building out that local footprint in recent years. and built out capabilities, built out capacity, and we feel we're well positioned to take advantage of that growth. Southeast Asia then will be the next building block in terms of that growth in the region.

We already have very well -- very strong positions there across multiple countries, capabilities in place, footprint in place, capabilities both in terms of commercial and RD&A. We see a limited need to further invest there because we feel we're already well set up. Our relationship with customers is really, really strong. And Southeast Asia will also be a subregion whereby that we will see that middle-class consumer growth over the next decade as well.

In terms of M&A outlook for the next number of years, I referenced previously on the call some areas where we will be focusing that investment or one should expect that we're thinking about M&A in a bolt-on nature for the coming years, maybe in the zone of EUR 100 million to EUR 200 million per year, more or less in that zone, similar to what the last number of years have been at.

Our last question for today comes from Cathal Kenny from Davy.

Firstly, the outlook for pricing and inflation for the remainder of 2026. Second question relates to your long-term targets for Europe. What would it take to lift Europe from its current run rate to the midpoint of the 1% to 2% volume growth? And finally, question on renovation. I think you mentioned them it's 40% of the current pipeline. Does that infer that you have greater visibility now over forward revenues as renovation isn't dependent on market growth, it's more about projects. Those are my 3 questions.

So I'll kick off here, Cathal. Yes. So firstly, maybe on the renovation point. The nature of renovation is that typically, it is products that are well established in the market. Therefore, there is visibility in terms of the scale of those particular opportunities. There's more certainty around the scale of those opportunities. So when we are deploying resources on those renovation opportunities, we are quite confident in terms of, let's say, the potential outcome.

Which obviously is a little bit different on the innovation side where you're bringing a new innovation to the market or customers bringing new innovations to market, they can be -- it's not always perfectly predictable to see how that new innovation in the market actually ultimately performs, and there could be an element of variability around that performance. So I don't want to overplay the level of visibility. I mean, the current market backdrop doesn't kind of lend itself to kind of predicting the future extremely well.

But for sure, as it relates to renovation, we have better visibility in terms of the expected outcome. Then maybe shifting to Europe. Like we've said, we are planning limited growth this year in that 0% to 1% range. Look, the team are very focused on executing against the strategies. We're not changing strategy in Europe. We believe we have the right strategy in Europe. We have the right strategy in place. We're building on that. We're taking a more proactive approach, like I said previously. We are seeing green shoots. We are seeing progression on the overall pipeline. And we do believe we will make further progress in 2027 and beyond to be comfortably within that midpoint of 1% to 2% here over the medium term.

And Cathal, on your input cost inflation expectation, we expect to move from deflation in the first half to some limited inflation in the second half of the year.

Ladies and gentlemen, that is all that we have for the Q&A session. I will now turn the call back over to Edmond Scanlon for closing remarks.

So thanks, everybody, for joining our call this morning. We're conscious it's a very busy morning, and we've put a lot out there as well. Look, overall, we believe we have a powerful strategy. We're executing well against those strategies. We believe that there is momentum in our business, allowing for that market backdrop, and we do believe we are well set up for the future.

As we've mentioned previously, the presentation of our 2030 targets and our prepared remarks are up on our website, and we would encourage you to listen back if you haven't already. We will be hosting our Investor Day on October 8 in Beloit, Wisconsin. And if you have any follow-ups from this morning, please reach out to the IR team. Thank you, and have a great day.

Good morning, and welcome to our 2026 half year results. I'd like to start with a quick logistics update this morning as we're conscious it's a busy period of earnings releases. As usual, our CEO, Edmond Scanlon; and our CFO, Marguerite Larkin, will take you through our H1 results presentation.

We have also today released our 2030 financial targets. A separate webcast with our prepared remarks is available on our website. At 8:30 a.m. today, we will host our analyst Q&A call, which will cover both our half year results and our 2030 financial targets. Before we begin, please take note of the disclaimer on the H1 presentation regarding forward-looking statements.

I'll now hand over to Edmond.

Thanks, William. Good morning, everyone. Beginning with Slide 4 and the summary overview of H1 2026. We're pleased to report a strong performance in the first half, reflecting a step-up in volume growth in the second quarter, combined with continued strong margin expansion, driving high single-digit constant currency adjusted EPS growth.

Firstly, on revenue, we delivered 3.3% volume growth in the half, which was well ahead of end market and channel growth and reflected an acceleration in volume growth from 3.1% in Q1 to 3.5% in Q2. This increase in growth was broad-based across each of our 3 regions and also across both the retail and foodservice channels. Growth was led by a strong performance in the foodservice channel with a range of new menu innovations, seasonal launches and cost reduction solutions. Growth in the retail channel was supported by continued product renovation activity and innovation in high-growth areas across a range of customers.

On EBITDA margins, we delivered margin expansion of 60 basis points in H1 with margin progression across all 3 regions. This was driven by Accelerate 2.0, net price, operating leverage and portfolio mix benefits. This volume growth and margin expansion we achieved in the first half supported our constant currency adjusted earnings per share growth of 7.9%. From a strategic perspective, we continue to evolve our business through targeted capital investments and portfolio development activity. And today, we're excited to share our updated financial targets. In the presentation webcast, which is available on our website, we're outlining the key dynamics in our industry right now and the key drivers of our business performance.

Moving next to the H1 business overview on Slide 5. Volume growth in the first half represented a strong market outperformance. Volume growth across our end-use markets was led by snacks, meat, dairy and beverage EUMs. This was supported by good growth across a broad range of taste and biotechnology solutions, including Tastesense salt and sugar reduction technologies, botanicals, natural extracts, taste solutions for high-protein applications, enzymes and natural preservation solutions. And in emerging markets, we had volume growth of 5%, led by good performances in the Middle East, Africa and LATAM.

Turning next to the performance by region and starting with the Americas on Slide 6, where we delivered continued strong performance. Reported revenue for the region was EUR 1.8 billion with volume growth of 3.7% in H1 and 3.9% in Q2. EBITDA margins for the region increased by 40 basis points to 18.9%, driven by Accelerate 2.0, operating leverage and product mix.

In North America, we had strong growth in snacks through innovations and renovations utilizing Kerry's range of savory taste profiles and Tastesense salt reduction technologies as well as new innovations focused on delivering science-backed health and wellness benefits. Growth in meat was driven by innovations with new signature taste profiles and natural preservation systems, while beverage had good performances in the refreshing and nutritional beverage categories through botanicals, natural extracts and coffee-based solutions. Across our channels, we had a good performance in retail, supported by innovation and renovation activity across both customer and retailer brands, with foodservice continuing to strongly outperform traffic in the channel.

Within LATAM, strong growth was achieved in Mexico across the snacks and beverage end markets in particular, and business developments in the region included beverage taste capacity and capability enhancements in North America and progression of our taste footprint expansion in Mexico.

Moving to Europe on Slide 7, where the volume performance reflected growth across the retail and foodservice channels. Reported revenue for the region was EUR 687 million, with volume growth of 0.5% in H1 and 0.6% in Q2. On margins, we delivered strong EBITDA margin expansion of 80 basis points. Looking at our end-use markets. Volume growth in beverage was led by refreshing beverage and the performance of low- and no-alcohol solutions through integrated taste, botanicals and Tastesense sugar reduction technologies, while performance in dairy was driven by taste and protein masking solutions. Across our channels, retail growth was led by the performance of snacks with growth in foodservice driven by refreshing beverage innovations. And business investments in the region included expansion of our proactive health capacity and capabilities in Spain.

Turning to APMEA on Slide 8, where performance in the region was led by volume growth in the Middle East and Africa, with China returning to growth and a solid performance in Southeast Asia. Reported revenue for the region increased to EUR 831 million, led by volume growth of 4.9% in H1 and 5.2% in Q2. On margins, we had EBITDA margin expansion of 80 basis points for the region in H1. Across our end markets, growth was led by dairy through enzymes and dairy taste. Meat also had good growth, while snacks growth was driven by the continued strong performance of savory taste solutions. Within our channels, retail growth was led by good performance in taste with foodservice growth led by performance with leading regional coffee chains and QSRs.

Finally, business developments in the region included commencing footprint expansion in Turkey and capacity expansion in the Middle East.

And with that, I'll hand you over to Marguerite for the financial review.

Thanks, Edmond, and good morning, everyone.

Turning to Slide 10 and the financial overview for the first half of the year. Revenue was EUR 3.3 billion with volume growth of 3.3%. EBITDA increased to EUR 558 million, reflecting 5.8% organic growth. We delivered strong EBITDA margin expansion of 60 basis points. Adjusted earnings per share of EUR 2.141 was up 7.9% in constant currency and 2.3% in reported currency. Return on capital employed of 10.5% reflects a currency headwind of 30 basis points and underlying progression of 10 basis points versus the prior year. And free cash flow was EUR 262 million, representing average cash conversion of 76%.

Turning to our group revenue bridge on Slide 11. Volume growth was 3.3%, as I mentioned. Pricing was 1% lower with overall input cost deflation in the first half. The organic growth we delivered in the first half was more than offset by adverse translation currency of 4.8% given the significant movement in the U.S. dollar versus the euro. Disposals net of acquisitions had a net impact of 1.1%, which are enabling the execution of our Accelerate 2.0 footprint optimization strategy.

Turning now to the margin bridge on Slide 12. EBITDA was EUR 558 million with strong EBITDA margin expansion of 60 basis points. Looking at the key moving parts. Firstly, operating leverage and portfolio mix contributed a 10 basis points improvement. Net price was favorable 20 basis points in the period. Our Accelerate 2.0 program is well on track and delivered 40 basis points of EBITDA margin expansion in the period, led by progress in footprint optimization in both North America and Europe. The expansion and deployment of our digital initiatives to drive efficiencies continued across our manufacturing operations, commercial enablement activities and Global Business Services. Foreign currency was a headwind of 20 basis points, principally due to the movement in the U.S. dollar versus the euro just mentioned, and acquisitions and disposals contributed a positive 10 basis points. Overall, we are pleased with our margin progression in the period and remain on track for strong margin expansion in the full year.

Moving now to free cash flow on Slide 13. We generated free cash flow in the period of EUR 262 million, reflecting 76% average cash conversion on earnings with cash conversion of 85% based on the working capital movement between balance sheet dates. Looking at the component parts for H1. Firstly, EBITDA increased to EUR 558 million. Average working capital represented an investment of EUR 81 million, aligned to the growth and business development as well as increased investment in inventories to mitigate supply chain disruption risk given recent geopolitical events. Finance costs of EUR 29 million with the increase year-on-year reflecting the timing of bond interest payments in the prior year and increased capital expenditure of EUR 145 million was reflective of phasing of various strategic capital investments across each of our regions, as Edmond mentioned. Overall, we remain well on track to deliver cash conversion of 80% plus in the full year across both of the cash conversion metrics I just mentioned.

On our debt profile and credit metrics on Slide 14, net debt at the end of June was EUR 2.4 billion with a weighted average maturity of 5.8 years. Our credit metrics are strong with a net debt-to-EBITDA ratio of 2x, and we have a very strong balance sheet, which will continue to support the further development of our business.

Finally, to cover off a number of other financial matters on Slide 15. Finance costs of EUR 30 million were similar to the prior year. Net nontrading items were EUR 32 million, reflecting the good progress of the Accelerate 2.0 program. On input costs, we had overall deflation in H1, which will turn to limited inflation in H2. On capital returns, we have announced an interim dividend of $0.462 per share, a year-on-year increase of 10%. On share buybacks, we repurchased EUR 173 million worth of shares during the period. And on currency, we now expect a foreign currency translation headwind of 1% to 2% on adjusted earnings per share in the full year.

To summarize, we delivered a strong financial performance in the first half, driven by volume growth well ahead of end markets and continued EBITDA margin expansion.

And with that, I'll pass you back to Edmond.

Thanks, Marguerite. Moving to our full year outlook on Slide 17. Our strong end market volume outperformance in the first half of the year demonstrates the strength of our strategic positioning across our markets, channels and customer base. We will continue to develop our business while supporting our customers as their key innovation and renovation partner.

Looking to the remainder of the year, while recognizing the current market uncertainty, we remain strongly positioned for volume growth and margin expansion, underpinned by a good innovation pipeline. And we are maintaining our full year adjusted earnings per share guidance of 6% to 10% constant currency growth. Thank you.

Good morning, and welcome to our 2026 half year results. I'd like to start with a quick logistics update this morning, as we're conscious it's a busy period of earnings releases. As usual, our CEO, Edmond Scanlon; and our CFO, Marguerite Larkin, will take you through our H1 results presentation. We have also today released our 2030 financial targets. A separate webcast with our prepared remarks is available on our website. At 8:30 a.m. today, we will host our analyst Q&A call, which will cover both our half year results and our 2030 financial targets. Before we begin, please take note of the disclaimer on the H1 presentation regarding forward-looking statements.

I'll now hand over to Edmond.

Thanks, William. Good morning, everyone. Beginning with Slide 4 and the summary overview of H1 2026. We're pleased to report a strong performance in the first half, reflecting a step-up in volume growth in the second quarter, combined with continued strong margin expansion, driving high single-digit constant currency adjusted EPS growth. Firstly, on revenue, we delivered 3.3% volume growth in the half, which was well ahead of end market and channel growth and reflected an acceleration in volume growth from 3.1% in Q1 to 3.5% in Q2. This increase in growth was broad-based across each of our 3 regions and also across both the retail and foodservice channels. Growth was led by a strong performance in the foodservice channel with a range of new menu innovations, seasonal launches and cost reduction solutions. Growth in the retail channel was supported by continued product renovation activity and innovation in high-growth areas across a range of customers.

On EBITDA margins, we delivered margin expansion of 60 basis points in H1, with margin progression across all 3 regions. This was driven by Accelerate 2.0, net price, operating leverage and portfolio mix benefits. This volume growth and margin expansion we achieved in the first half supported our constant currency adjusted earnings per share growth of 7.9%. From a strategic perspective, we continue to evolve our business through targeted capital investments and portfolio development activity. And today, we are excited to share our updated financial targets. In the presentation webcast, which is available on our website, we're outlining the key dynamics in our industry right now and the key drivers of our business performance.

Moving next to the H1 business overview on Slide 5. Volume growth in the first half represented a strong market outperformance. Volume growth across our end-use markets was led by snacks, meat, dairy and beverage EUMs. This was supported by good growth across a broad range of taste and biotechnology solutions, including Tastesense salt and sugar reduction technologies, botanicals, natural extracts, taste solutions for high-protein applications, enzymes and natural preservation solutions. And in emerging markets, we had volume growth of 5%, led by good performances in the Middle East, Africa and LATAM.

Turning next to the performance by region and starting with the Americas on Slide 6, where we delivered continued strong performance. Reported revenue for the region was EUR 1.8 billion, with volume growth of 3.7% in H1 and 3.9% in Q2. EBITDA margins for the region increased by 40 basis points to 18.9%, driven by Accelerate 2.0, operating leverage and product mix. In North America, we had strong growth in snacks through innovations and renovations utilizing Kerry's range of savory taste profiles and Tastesense salt reduction technologies as well as new innovations focused on delivering science-backed health and wellness benefits.

Growth in meat was driven by innovations with new signature taste profiles and natural preservation systems, while beverage had good performances in the refreshing and nutritional beverage categories through botanicals, natural extracts and coffee-based solutions. Across our channels, we had a good performance in retail, supported by innovation and renovation activity across both customer and retailer brands, with foodservice continuing to strongly outperform traffic in the channel.

Within LATAM, strong growth was achieved in Mexico across the snacks and beverage end markets, in particular, and business developments in the region included beverage taste capacity and capability enhancements in North America and progression of our taste footprint expansion in Mexico.

Moving to Europe on Slide 7, where the volume performance reflected growth across the retail and foodservice channels. Reported revenue for the region was EUR 687 million, with volume growth of 0.5% in H1 and 0.6% in Q2. On margins, we delivered strong EBITDA margin expansion of 80 basis points. Looking at our end-use markets. Volume growth in beverage was led by refreshing beverage and the performance of low/no alcohol solutions through integrated taste, botanicals and Tastesense sugar reduction technologies, while performance in dairy was driven by taste and protein masking solutions.

Across our channels, retail growth was led by the performance of snacks with growth in foodservice driven by refreshing beverage innovations. And business investments in the region included expansion of our proactive health capacity and capabilities in Spain.

Turning to APMEA on Slide 8, where performance in the region was led by volume growth in the Middle East and Africa, with China returning to growth and a solid performance in Southeast Asia. Reported revenue for the region increased to EUR 831 million, led by volume growth of 4.9% in H1 and 5.2% in Q2. On margins, we had EBITDA margin expansion of 80 basis points for the region in H1. Across our end markets, growth was led by dairy through enzymes and dairy taste. Meat also had good growth, while snacks growth was driven by the continued strong performance of savory taste solutions.

Within our channels, retail growth was led by good performance in taste with foodservice growth led by performance with leading regional coffee chains and QSRs. Finally, business developments in the region included commencing footprint expansion in Turkey and capacity expansion in the Middle East.

And with that, I'll hand you over to Marguerite for the financial review.

Thanks, Edmond, and good morning, everyone. Turning to Slide 10 and the financial overview for the first half of the year. Revenue was EUR 3.3 billion with volume growth of 3.3%. EBITDA increased to EUR 558 million, reflecting 5.8% organic growth. We delivered strong EBITDA margin expansion of 60 basis points. Adjusted earnings per share of EUR 2.141 was up 7.9% in constant currency and 2.3% in reported currency. Return on capital employed of 10.5% reflects a currency headwind of 30 basis points and underlying progression of 10 basis points versus the prior year. And free cash flow was EUR 262 million, representing average cash conversion of 76%.

Turning to our group revenue bridge on Slide 11. Volume growth was 3.3%, as I mentioned. Pricing was 1% lower with overall input cost deflation in the first half. The organic growth we delivered in the first half was more than offset by adverse translation currency of 4.8%, given the significant movement in the U.S. dollar versus the euro. Disposals net of acquisitions had a net impact of 1.1%, which are enabling the execution of our Accelerate 2.0 footprint optimization strategy.

Turning now to the margin bridge on Slide 12. EBITDA was EUR 558 million with strong EBITDA margin expansion of 60 basis points. Looking at the key moving parts. Firstly, operating leverage and portfolio mix contributed a 10 basis points improvement. Net price was favorable 20 basis points in the period. Our Accelerate 2.0 program is well on track and delivered 40 basis points of EBITDA margin expansion in the period, led by progress in footprint optimization in both North America and Europe. The expansion and deployment of our digital initiatives to drive efficiencies continued across our manufacturing operations, commercial enablement activities and global business services. Foreign currency was a headwind of 20 basis points, principally due to the movement in the U.S. dollar versus the euro just mentioned, and acquisitions and disposals contributed a positive 10 basis points. Overall, we are pleased with our margin progression in the period and remain on track for strong margin expansion in the full year.

Moving now to free cash flow on Slide 13. We generated free cash flow in the period of EUR 262 million, reflecting 76% average cash conversion on earnings, with cash conversion of 85% based on the working capital movement between balance sheet dates. Looking at the component parts for H1. Firstly, EBITDA increased to EUR 558 million. Average working capital represented an investment of EUR 81 million, aligned to the growth and business development as well as increased investments in inventories to mitigate supply chain disruption risk given recent geopolitical events. Finance costs of EUR 29 million with the increase year-on-year, reflecting the timing of bond interest payments in the prior year and increased capital expenditure of EUR 145 million was reflective of phasing of various strategic capital investments across each of our regions, as Edmond mentioned. Overall, we remain well on track to deliver cash conversion of 80% plus in the full year across both of the cash conversion metrics I just mentioned.

On our debt profile and credit metrics on Slide 14. Net debt at the end of June was EUR 2.4 billion, with a weighted average maturity of 5.8 years. Our credit metrics are strong with a net debt-to-EBITDA ratio of 2x, and we have a very strong balance sheet, which will continue to support the further development of our business.

Finally, to cover off a number of other financial matters on Slide 15. Finance costs of EUR 30 million were similar to the prior year. Net non-trading items were EUR 32 million, reflecting the good progress of the Accelerate 2.0 program. On input costs, we had overall deflation in H1, which will turn to limited inflation in H2. On capital returns, we have announced an interim dividend of EUR 0.462 per share, a year-on-year increase of 10%. On share buybacks, we repurchased EUR 173 million worth of shares during the period. And on currency, we now expect a foreign currency translation headwind of 1% to 2% on adjusted earnings per share in the full year.

To summarize, we delivered a strong financial performance in the first half, driven by volume growth well ahead of end markets and continued EBITDA margin expansion. And with that, I'll pass you back to Edmond.

Thanks, Marguerite. Moving to our full year outlook on Slide 17. Our strong end market volume outperformance in the first half of the year demonstrates the strength of our strategic positioning across our markets, channels and customer base. We will continue to develop our business while supporting our customers as their key innovation and renovation partner. Looking to the remainder of the year, while recognizing the current market uncertainty, we remain strongly positioned for volume growth and margin expansion, underpinned by a good innovation pipeline. And we are maintaining our full year adjusted earnings per share guidance of 6% to 10% constant currency growth. Thank you.

Good morning, and welcome to our Q1 2026 trading update call. I'm joined on the call by our CEO, Edmond Scanlon and our CFO, Marguerite Larkin. As usual, Edmond and Marguerite will take you through a brief presentation, after which we will open the lines up for your questions. Before we begin, please note the usual disclaimer on our Q1 presentation regarding forward-looking statements. I will now hand over to Edmond.

Thanks, William. Good morning, everyone, and thank you for joining our call. Moving to Slide 4 and my overview comments. And we're pleased to report we delivered a good start to the year in Q1 with volume growth across all 3 regions and continued strong margin expansion. Beginning with revenue, we delivered Q1 volume growth of 3.1%, reflecting our continued strong end market outperformance. As we said at CAGNY, circa 60% of our customer activity in North America is on renovation activity at the moment, and our innovation pipeline also continues to deliver. And this is what is supporting the volume growth we achieved in the Americas and APMEA with Europe returning to growth.

From a channel perspective, foodservice continued to strongly outperform the market, driven by new menu innovations, seasonal products and continued product renovation activity across global QSRs, fast casuals and coffee chains. Growth in the retail channel was supported by continued product renovation activity across global customers and retailer brands, along with innovation in high-growth areas with a range of customers.

Across our end markets, growth was led by meat, snacks and dairy. And by technology, we had strong growth across our savory taste and Tastesense salt and sugar and integrated solutions incorporating Kerry's botanicals and natural extracts combined with our fermentation-derived and enzymatic bio-fermentation portfolio and natural clean label food protection and preservation systems.

Moving to margins. We delivered strong EBITDA margin expansion of 60 basis points in the first quarter, primarily driven by Accelerate operational excellence. We've expanded group margins by over 300 basis points in the past 4 years and are well on track to achieve our 2026 target of 18% to 19% EBITDA margin. On guidance, which I'll cover off more in some detail later, while recognizing the ongoing geopolitical volatility, we remain strongly positioned for volume growth and margin expansion and are maintaining our range of 6% to 10% in constant currency earnings per share growth in 2026.

Strategic execution at Kerry is focused on 2 things. First is delivering on our high single-digit plus earnings growth algorithm through consistent volume growth and margin expansion. And secondly is continuing to strategically develop our business. Building on the strategic development update we gave in February, we've continued to advance this across each of our regions. Within the Americas, we've enhanced our beverage taste capacity and capability in North America, and we've commenced further footprint expansion of savory taste in Mexico.

In Europe, we've expanded our proactive health capacity and capabilities in Spain. And in APMEA, we've commenced developing our new local taste facility in Turkey. These are just a few examples of the ongoing strategic developments that will continue to support the growth of our business and the execution of our strategy. So with that, I'll now hand you over to Marguerite for the business performance overview.

Thanks, Edmond, and good morning, everyone. Moving to Slide 5 and the business review. We are pleased with the performance in the period where we delivered good volume growth and margin expansion. Volume growth in the first quarter of 3.1% was well ahead of our end markets with good growth across both foodservice and retail. Pricing was 1.3% lower, reflective of overall net deflation across our basket of input costs.

On the EBITDA margins, we delivered good business margin progression of 60 basis points, primarily driven by Accelerate 2.0 with additional benefits from operating leverage, product mix, net price and disposals being partially offset by an adverse translation currency impact. Looking at our end markets. Despite challenging market conditions in places, we delivered strong growth in meat, snacks and dairy, driven by high levels of innovation and renovation activity with our customers. In foodservice, we had growth of 4.6%, combined with good growth in retail. And volumes in emerging markets increased by 4.4% across the period, led by a strong performance in Africa.

Turning to Slide 6 now and our performance by region. Firstly, in the Americas, we delivered volume growth of 3.4% in the period with good performances in both North America and LatAm. Within North America, we had good growth in meat, snacks and dairy, driven by continued customer focus on improving the nutritional profiles of their products as well as good launch activity with new signature taste profiles.

We delivered strong growth in the foodservice channel, led by growth with quick service and fast casual restaurants, with growth in the retail channel supported by good renovation activity across both customer and retailer brands. Within LatAm, we had strong growth in Mexico, most notably within the snacks and beverage end markets. Moving to Europe, which delivered volume growth of 0.4%. Good growth was achieved in beverage through new refreshing beverage innovations, incorporating Kerry's integrated taste technologies, botanicals and Tastesense sugar reduction technologies.

Growth in dairy was supported by protein taste solutions, while category volumes in bakery were challenged in the period. Retail channel volumes returned to growth in the first quarter with performance in foodservice led by quick service restaurants and coffee chains. And finally, to APMEA, where we delivered volume growth of 4.6%, led by strong growth in Africa. China returned to growth, and we had solid performances in the Middle East and Southeast Asia. Performance by channel was led by good growth in retail and by end market, growth was led by meat, bakery and snacks through savory taste, texture and enzyme technologies in particular.

Turning to Slide 7, outlining the constituent parts of the Q1 reported revenue movements. Taking each of these in turn, beginning with volume, we delivered growth of 3.1%, as I mentioned, and pricing was 1.3% lower, reflecting overall input cost deflation in the first quarter. The organic growth delivered in Q1 was more than offset by adverse translation currency of 7.9%, given the significant movement in the U.S. dollar versus the euro. This effect is most pronounced in the first quarter and expected to reduce across the rest of the year.

Disposals net of acquisitions had a revenue impact of 1.2%, which are enabling the execution of our Accelerate 2.0 footprint optimization strategy and supporting the margin expansion I referenced earlier. Finally, moving to other matters on Slide 8. Net debt at the end of the period was EUR 2.2 billion and reflects cash generation, capital investment and the share buyback program. On Accelerate 2.0, we continue to progress as planned with footprint optimization in both North America and Europe and the expansion of our digital initiatives across manufacturing, commercial and global business services.

On input costs, we are currently looking at overall deflation in the first half of the year with variation within our input cost basket, turning to some level of inflation in the second half. We will continue to update you as we progress through the year. On currency, based on prevailing rates, we are now forecasting a translation currency headwind of circa 3% of earnings per share in the full year compared to 4% at year-end.

To summarize, we delivered a good financial performance with good volume growth along with continued margin expansion. And with that, I'll pass you back to Edmond.

Thanks, Marguerite. Finally, before we move to Q&A, I'd like to close out with our full year outlook. Our continued strong end market outperformance highlights the strength and relevance of our strategic positioning across our markets, channels and customer base. We will continue to further strategically develop our business, while supporting our customers as their innovation and renovation partner. Our extensive local footprint, unique technology capability and the strength of our business model positions us well to navigate through this period of geopolitical and macroeconomic uncertainty.

While recognizing the uncertainty around the ongoing geopolitical volatility, we remain strongly positioned for volume growth and margin expansion with a good innovation pipeline. And we are maintaining our full year constant currency earnings per share guidance of 6% to 10% growth.

And with that, I'll hand you back to the operator, and we look forward to taking your questions.

[Operator Instructions] Our first question comes from the line of Alex Sloane with Barclays.

I've got 2, please. The first is just on the volume growth outlook. Obviously, you're reiterating being strongly positioned for volume growth for the year. You do note some input cost inflation returning in the second half. I appreciate it's a challenge given the level of volatility. But can I ask what your base case end market volume assumptions are for the balance of the year, as that inflation feeds through to consumers later in the year? Or sort of put another way, are you confident in sustaining around 3% volume growth for the full year in this backdrop as it stands? That's the first one.

Secondly, on APMEA, you delivered solid growth there in the first quarter, no obvious Middle East disruption apparent. How have you mitigated that this time when it was maybe more of a challenge in June of last year? And also just on APMEA, nice to see China back into growth. Can you maybe talk to the durability of the recovery there over the next few quarters?

Thanks, Alex. Maybe on the guidance first and the outlook for the year. Look, we haven't changed the overall guidance. We're expecting volume growth to be similar to 2025. We're not calling out any material change to either our retail outlook or our foodservice outlook. We do continue to expect foodservice to outperform retail. And from a regional perspective, one should assume a full year outlook similar to what we just posted there for Q1.

Lots of moving parts, as you said there, Alex. Let's say -- let's see how inflation plays out. But I also have to say that the quality of our pipeline, the scale of our pipeline is very solid as we look out into the remainder of the year. We're particularly excited about our business in the Americas. Renovation is really delivering for us. Wellness reformulation continues to increase, and we believe we have, let's say, leading capabilities in that space.

And on top of that, let's see how things play out, but we are seeing some momentum around front-to-pack labeling in the Americas as well. We have to see exactly how that translates to the front of the pack, but there is potential momentum there towards the back end of the year. We've taken all these things into account, as we've looked at the guidance, and that's kind of why there are some of the puts and takes, as we kind of reiterate the guidance for the full year.

In terms of, let's say, how we're positioned for the Middle East, look, the reality of the situation is that we believe we're best positioned to be able to deal with the volatility. Like I said previously versus where we were a year ago, we've taken a position to derisk the overall supply chain. There were some learnings from a year ago around inventory levels, around where certain routes that raw materials were being rotated through. We made some changes around that.

But I think at a higher level, I think from our overall footprint perspective, the investments that we've made around Oman, around Saudi, around Egypt in terms of having that global footprint and all the support capabilities that we have with that, we're able to give customers a lot of confidence around our ability to be able to respond, our ability to remain agile, our ability to be able to support them, whether it's on the retail channel or the foodservice channel. And I feel quite confident around our ability to be able to be very agile, be very proactive. There's a high level of engagement with customers. And overall, I think, we're well positioned as we engage with customers in that region.

Then lastly, on China, we're pleased to be back into growth in China. I wouldn't be calling out any kind of significant kick on in the remainder of the year or anything like that. Retail was improved throughout the course of the quarter, and we would expect China to kind of remain more or less in the same zone for the remainder of the year.

Our next question comes from the line of Patrick Higgins with Goodbody.

Maybe just my first question is around private label retailer brands in the U.S. I guess, given the -- I know you called out in your kind of prepared remarks, continued strong momentum there, but maybe just to share a bit of color there, I guess, given the signs of more promotional activity and innovation from the brand owners, do you see any kind of shifts in terms of momentum in own label in the U.S. or how are engagements, I guess, more generally?

And then I guess my other question is on the reformulation or renovation activity. Maybe, Edmond, just a little bit more color. Obviously, clearly a key underpin to growth currently in the U.S., do you see more of a federal level kind of regulation kind of coming through to kind of drive a step-up in that renovation? Or is it -- customers are actually just proactively looking at ways to reformulate to get ahead of any possible changes in terms of labeling laws, et cetera?

Patrick, so I'll take that. I mean -- look, I mean, we've been very consistent around our -- narrative around the Americas. I mean it's a market that continues to deliver for Kerry. Despite some of the maybe macro numbers that -- or macro narrative that sometimes are discussed around, let's say, the underlying market conditions within the Americas, there continues to be pockets -- good pockets of opportunity right across the board.

Look, on the renovation side, it just -- this is something we flagged 18 months ago. It is really delivering for us. We see -- we continue to see, I would say, an elevated level of engagement from customers around renovation. Consumers continue to demand products that are healthier, that are better, that are cleaner label. And these all feed into our best-in-class capabilities around all those particular areas. We are seeing some momentum at a federal level around some regulatory intervention around front-to-pack labeling.

It's not exactly clear how it will actually land into the market. But that is something that seems to be gaining any momentum at a federal level. And obviously, that's something that we would welcome and would see as being a real positive for our business. Look, on the foodservice side, foodservice, we continue to outperform there. We believe we have a structural tailwind in the channel. And frankly, we only see this increasing. Foodservice activity, launch activity is very high at the moment. Foodservice operators are looking at LTOs to drive traffic into their stores.

And back then maybe on the retail side, again, we are seeing some early positive signs in certain categories around price promotions. So that is -- while it's early days, we have seen some green shoots. And then, I guess, from an overall innovation perspective, we are seeing areas like high protein, poultry, ready-to-drink coffee, cold coffee, supplements. All these areas are providing growth opportunities for us in North America.

I would say from a segmentation standpoint, we have a huge breadth of customer base and a huge breadth of customer engagement right across the Americas, whether that's with globals, locals, the emerging brands or retailers that are targeting to grow their private label offerings. So right across the board, we feel we're very well positioned and feel positive about the go forward in the Americas overall.

Our next question comes from the line of Charles Eden with UBS.

Just one for me, please. There's been a lot of focus on the potential of demand pull forward into March, I guess, given the context of the Middle East conflict. Could you comment on whether you believe that might be something that Kerry has seen in Q1? And I guess also related to that, perhaps you could give a comment on whether there's been any material change in trends in April across the various geographies and channels.

Thanks, Charles. I wouldn't be calling out any material change from a trending standpoint nor would I be flagging anything in terms of anything unusual from an order pattern perspective between March or April or anything like that. And I think that goes back to the fact, Charles, that we are -- we have a very, very strong local footprint in the Middle East. So we can give assurance to customers that we're there. We have the raw materials in place.

And of course, there has been disruption on the supply side, but the teams have done an amazing work to derisk the supply side as much as we possibly can. And I think that in combination with where we are from that local footprint standpoint, I think, is giving customers a lot of confidence in our ability to deliver. So really, there's no need for them to pull forward orders is the reality of the situation.

Perfect. That's very clear. And if I could just sneak a follow-up in. Is there any inputs that are primarily sourced from the Middle East that are used elsewhere, i.e., is there any sort of supply constraints for any inputs? Or is that not really a factor either?

Let's say, when we've looked at that, Charles, it's some of those kind of unique raw materials that are sourced in that region are for that region actually and typically don't necessarily find their way into other regions. It's kind of different to, let's say, China and India, which are more of a kind of a global supply base. The Middle East is more of a local supply base as is obviously the China and India back into the Middle East. So it's not really, I would say, a feature of note.

[Operator Instructions] Our next question comes from the line of Nicola Tang with BNP Paribas.

Maybe I'll start by sticking to the topic of inputs. I mean, I think you're mainly more exposed to naturals and synthetics and it seems to be more on the synthetic side. So you still have the deflation. But when you talked about the potential inflation in the second half of the year, are there specific raw materials or specific inputs that you would call out? And perhaps you could also, within that, talk about how you deal with potentially higher energy costs or logistics costs and so on?

And then the second question, coming back to APMEA, I think at CAGNY, you gave us a helpful split of APMEA and across the different regions. I was wondering if you could share more color on how those different regions have performed through Q1. And I guess sort of tagged in with the very first question from Alex around the potential impact of inflation on the end consumer. I was wondering about in Southeast Asia, in particular, where I don't know, it seems like there's obviously higher energy costs, there's some work-from-home mandates and this kind of stuff. I was wondering whether you had seen or expect to see any impact on the end consumer in that region?

Thanks, Nicola. I might kick off here and Marguerite then will jump in. Maybe on the last part of your question first, we have seen some slight softness in market conditions in Southeast Asia, and we have taken that into account in our, let's say, overall perspective on the go forward. We do see somewhat of an offset in China versus Southeast Asia, but we have seen some slight softness in that market.

That said, I mean, I think from a customer engagement standpoint and just activity standpoint, we would still call out that our performance in Southeast Asia will be quite solid, and we'll continue to outperform the market in Southeast Asia. Maybe -- then maybe taking a step back and looking at the overall APMEA region, firstly, to say that performance in the quarter was in line with our overall expectation. Look, the standout for us in terms of performance in the region was that our Africa business, which is now about 2% of the total company, 10% of APMEA, approximately, grew at strong double digits.

So that was a really positive development, given the level of investment we have put into that region over the last several years. And again, I think it's our local strategy and our local focus bearing fruit for us. And we expect that strategy to continue to bear fruit for us out into the future with the elevated level of geopolitical volatility that is out there.

Our Middle East region, like we said, have continued to have solid performance, as did the rest of the MESA region, which includes India and Southwest Asia. North Asia, which is primarily China, back into growth, primarily driven by retail. And then Southeast Asia, again, a solid performance overall.

And Nicola, on your question on input costs, as you referenced, we are expecting to see deflation in the first half with some level of inflation in the second half. Right now, we're still probably looking at very limited deflation for the full year. There are variations across the basket, as you'd expect. We're probably seeing some level of inflation coming through on spices and natural oils, but we will update as the year progresses.

Clearly, we're seeing some increases on distribution costs, energy costs also, but that varies very much by geography, the level of cover we have in place. And we manage that very closely. As you know, we have a very well-established pricing model. It has served us very well over the years in terms of managing significant input cost inflation. And it's -- again, we plan to manage input cost inflations in a very similar way this time around with any inflation coming through on oil-related input costs through that pricing model and through surcharges as appropriate, working very closely with our suppliers and our customers.

Next question comes from the line of Ed Hockin with JPMorgan.

I've got 2, please. One is on Europe. So it's encouraging to see a return to volumes growth in the region in Q1. I was wondering if you could help dissect that a little bit for us, whether there was some improvement in the end market or whether the end market was reasonably unchanged and this is the result of some stepped-up execution in the region? And then my second question, please, is just on the brief pipeline outlook. Is there any material phasing in that outlook through the year in terms of how you see planned LTOs with customers or new product launches that we should consider?

Thanks for the question. Nothing notable we would call out on the overall phasing. I would say, look, we -- there is some LTO activity around the World Cup. That's kind of typical. But overall, I would say, World Cup or no World Cup, there is an overall elevated level of LTOs even versus last year and even versus the year before. And customers in the foodservice channel are really seeing LTOs delivering for them. And on top of that, we're seeing the food operators in foodservice really double down on value and really double down their value offerings. And that drives traffic into the stores, and that's good for Kerry.

So it's something we saw towards the end of 2025. And that promotional activity in foodservice has continued into 2026. And from what we can see, it's a winning proposition for customers, and we expect customers only to continue to double down on that strategy, which is good for us overall. Then in terms of any other phasing, I don't -- there's nothing of note that we would call out. Sorry, just then on Europe. The first point I'd make is that, look, Q4 -- elements of our Q4 performance, we would refer to as being an outlier.

So that's probably more of a feature in our Q1 versus Q4. We are seeing some progress in the retail channel overall. And our outlook for Europe for the remainder of the year is similar to Q1. So modest growth in Europe over the course of the year, in line with what we laid out at the beginning of the year.

Our last question comes from the line of Cathal Kenny with Davy.

Two quick questions. Firstly, on the end-use markets. I noticed dairy has been elevated both in the Americas and Europe. Just interested to know what sits behind that. And secondly, do you see any tailwind from your business in Mexico from the World Cup?

Maybe the second part of your question first, Cathal. For sure, in Mexico, there seems to be a lot more excitement in Mexico around the World Cup than there is in the U.S., frankly. So a lot of excitement there. But I think for many people in the U.S., they don't know the World Cup is going on to be very truthful about it. So yes, we are -- we have seen a lot of activity particularly -- in the foodservice side in Mexico, particularly, but not a major feature in North America -- within North America, unfortunately.

Then on dairy, I think the 2 points I'd call out on dairy is, firstly, low lactose dairy, no lactose dairy. Lactose-free dairy is a feature that continues to grow in the industry. We're very well positioned to enable customers to bring those types of products to market. There's also obviously a significant push around reduction of -- sugar reduction and sweetness reduction. And the combination of, let's say, our lactase enzymes on top of our Tastesense technology are giving us a synergistic benefit when it comes to helping customers reduce the amount of sweetness and reduce the amount of sugar in dairy applications.

We're also seeing scenarios where customers want to put more protein into dairy products that can give taste and texture impacts. And again, we're well positioned to be able to help customers to rectify those issues and ultimately improve the nutritional profile, while also maintaining the taste and texture of the product. So I think you're going to see more of that as the year progresses.

And that is all the questions that we have for today. I will now turn the call back over to Kerry for closing remarks.

Thank you. We just want to say thank you for everyone for taking the time to join us on the call today. If you do have any follow-up questions, please do reach out to us, and we just want to wish you a good day. Thank you very much.

It gives me great pleasure to introduce Kerry's presentation, which we always look forward to. Kerry is a global leader in the B2B specialty ingredients market with a consistent strong track record of growth. In fact, you've heard a lot about reformulations this week. These are one of the leaders doing it. They've just posted another year of strong volume growth, probably not coincidentally, and market outperformance just last Tuesday, and this is underpinned by their unique positioning as an innovation and renovation partner for customers across food and beverage. Under CEO, Edmond Scanlon's leadership, they've transformed into a pure-play taste and nutrition company, which has driven significant margin expansion. Joining Edmond today are Chief Financial Officer, Marguerite Larkin; Vice President of Marketing for North America, Elizabeth Horvath; and William Lynch, Head of Investor Relations.

Edmond, welcome. Thank you, and take it away.

Thanks, Jonathan. Good morning, everybody, and thank you for joining us. And for the people online dialing into the webcast, thank you for taking the time, and thank you for your interest. So what are we going to look at here today? I'll begin with an overview of our business and what strategic execution means for Kerry. And it boils down to 2 things: one, delivering on our high single-digit plus earnings algorithm through consistent volume growth and margin expansion, while at the same time to continue to strategically develop our business. Simple, clear, and this is what we are laser-focused on at Kerry. Next, Elizabeth will share a deep dive in our markets, which today remain highly dynamic with a significant opportunity, not just in the innovation space, but also in product renovation. And this has increased in importance in recent years. Following this, Marguerite will outline our financial model, our strong track record and how we strategically deploy capital across our business to support consistent earnings compounding.

Now moving to Kerry today, where we hold a unique position in the food and beverage industry globally. We do this through our global scale and market access, our broad technology portfolio and our customer innovation business model. So first, in terms of scale. We're one of the largest players when it comes to B2B specialty ingredients for the food and beverage industry with EUR 7 billion in revenues. We have phenomenal market access through our global footprint with 119 manufacturing facilities across 34 countries and supporting our nutritional reach to almost 1.5 billion consumers globally.

Next, we have the industry's most relevant technology portfolio. Our broad portfolio spans taste and biotechnology and is underpinned by our biofermentation and biotransformation capability. And this is a key differentiator when it comes to solving our customers and the industry's most complex challenges. And we do this through our dedicated customer innovation business model with 60-plus technology and innovation centers, 1,200 scientists and a cumulative investment of EUR 3 billion in science and technology over the last decade. It is this combination that we believe distinguishes and differentiates us in our industry.

So spending a moment now on our track record of business development and growth over the years. And starting with business development. We've shown before how we have evolved and in recent years, how we've transformed our business through the development of our biotechnology platform while also disposing of noncore businesses. And then on growth, we've grown from EUR 4 billion in revenue in 2017 to EUR 7 billion today. Our target is to be a high single-digit plus earnings compounder. We have a track record of double-digit adjusted earnings per share growth on average since 1986. And we have delivered high single-digit or greater constant currency adjusted EPS growth in 8 of the last 10 years.

This moves me on to the drivers of our earnings growth algo. Firstly, volume growth, where we have consistently outperformed our markets by more than 300 basis points over the past number of years, supported by strong growth in areas such as foodservice, emerging markets and sustainable nutrition as we support our customers to improve the nutrition, taste, cost and sustainability aspects of their products. On margins, we've expanded our EBITDA margin by over 300 basis points in the past 4 years. And we are on track to deliver our margin target of 19% to 20% by 2028. These drivers are supported by our high single-digit constant currency adjusted earnings per share growth in 2024 and in 2025, and we're expecting another year of high single-digit growth in 2026.

As I mentioned earlier, our strategic execution is about growth and business development. Recent business developments include our new biotechnology center in Leipzig in Germany, geographic footprint expansion in Egypt and East Africa, new customer innovation and co-creation centers in Dubai, in Frankfurt and Jakarta and a range of new innovations from our biotechnology expertise, which I'll elaborate on shortly.

We look at our business through 5 dimensions, and we have a well-balanced, diversified business, which you can see here on the page. The Americas and APMEA regions are our 2 largest regions for Kerry. And I'm going to go into a little bit more detail on these later on. We have a strong presence and are well spread across all food and beverage markets, customers and channels, allowing us to allocate resources to fast-growing areas with agility and speed. And our technology comprises of, firstly, integrated taste technologies across a range of application areas; and secondly, biotechnology solutions, which we have significantly invested in, in recent years. And I'll touch on now for a moment.

So why biotechnology? Because the food and beverage industry is facing new pressures that are only getting more complex. We're trying to feed a growing population with less reliable supply, greater climate volatility and a finite pool of raw materials. At the same time, consumers are demanding simpler labels, better nutrition, functional benefits and authentic taste experiences, all delivered more sustainably and, of course, at a competitive cost. Biotechnology and biofermentation is the unlock. It allows us to create new, scalable, resource-efficient solutions that aren't limited by traditional agriculture. It gives us the ability to deliver cleaner labels, improved nutrition and consistent taste while also reducing the environmental impact.

Going forward, biotechnology solutions will need to be bigger and bolder, and it is key to solving the industry's supply challenges and enabling the next generation of sustainable innovations. So what does all this mean for Kerry? For Kerry, biotechnology is not new. We've been purposely building out this portfolio for more than a decade now. We have invested heavily in leading science and technology capabilities. And today, we're at the forefront of creating the next generation of solutions for our customers. It starts with our natural taste portfolio, one of the most extensive in the industry. And we use natural taste building blocks. And importantly, about 40% of our taste solutions are already enabled by fermentation.

On top of this, we've been layering in a dedicated biotechnology portfolio from enzymes, proactive health solutions to biopharma technologies and fit protection systems. What is critical is that all of these capabilities are powered by biofermentation and biotransformation processes. That's what allows us to create integrated, scalable, sustainable solutions that directly address the increasing challenges facing our customers today. And the areas we're investing in are already accelerating and generating new innovations and new opportunities for our business, which I'll touch on next.

So over the past year, we delivered a number of breakthrough innovations powered by our biofermentation and biotransformation capabilities. We launched our next generation of fermentation-derived Tastesense Sweet and salt reduction technologies. Introduced a new Plenibiotic postbiotic for digestive and skin health. And we developed a new breakthrough enzyme system that delivers significantly more natural sweetness. We also expanded Kerry experience with a new fermentation-based solution, which delivers premium natural savory taste experiences. These are just a few of the examples of how biotechnology is becoming a key differentiator for Kerry and helping us solve our customers' most pressing challenges today and those that they're going to face into the future.

When we look at the food and beverage market, despite the subdued overall data coming through in the markets, our markets continue to remain highly dynamic. The opportunity in front of us is very real. And there are 2 sources: innovation and renovation. On the innovation side, growth is happening, and it is concentrated in areas where we play. And I'm sure none of this is going to come as a surprise to you after being here for the last couple of days. Firstly, high protein. Products with protein claims are growing at double the rate of those without. Ready-to-drink coffee is growing at high single-digit or low double-digit rates. Poultry is the fastest-growing protein source and supplements are growing at almost 10% year-on-year with 4 out of 5 people taking them daily.

Equally important is renovation. Over 60% of all food and beverage activity now involves product reformulation. And the drivers are clear. 70% of developers call out cost reduction with nearly 2/3 looking for clean label as consumers are actively cutting back on artificial ingredients. Simply, innovation is expanding the market and renovation is reshaping it. And at Kerry, we are at the intersection of both with the ability to help our customers create what's next while transforming what already exists. That's why we feel there's huge runway for growth ahead of us and why we believe we're uniquely positioned to capture it. And you'll see this come to life when Elizabeth shares some product examples shortly.

I'd now like to talk about the 3 areas where innovation and renovation are driving growth. So first is the Americas, where we have a winning model. Second is the APMEA region, where we're looking to accelerate our growth agenda. And third is regulation, which is increasingly driving renovation activity. So firstly, on the Americas, where we have a strong track record of volume growth. In a region where underlying food and beverage markets have been growing at more modest rates, we've delivered consistent volume growth in that 3% to 4% range across pretty much any time frame you can choose. This strong market outperformance is a result of clear differentiation anchored in, firstly, our unmatched customer and channel access. We operate right across the food and beverage ecosystem from global CPGs to emerging brands, from QSRs to fast casuals, from beverage to supplements, serving in excess of 20 routes to market.

Second, our go-to-market innovation models, which are tailored to each channel and customer segment, allowing us to engage directly, deeply, move faster and scale alongside our customers as they grow. And third, our ability to layer our global taste leadership combined with deep biotechnology expertise, tailoring those capabilities to the specific needs of each individual customer, whether that's innovation, reformulation, cost management, clean label or functional performance. You'll see how we do this through a number of examples here shortly, showing how we continue to deliver strong growth ahead of our markets in the Americas. And you'll see why we're confident in our ability to continue outperforming for the years ahead.

Moving now to the APMEA region, where again, we have a strong long-term track record of growth and business development and where we are looking to accelerate our growth agenda. In less than 30 years in this region, we have grown our revenues to over EUR 1.6 billion, close to doubling our sales in the last 10 years alone. In this period, we've more than doubled in size in Southeast Asia with the Middle East and Africa being the top growth driver, especially in the last 5 years. Consumers in this region are modernizing, not westernizing, looking for innovation while remaining rooted in local culture, authentic cuisine and familiar flavor cues.

Our extensive in-market capabilities, combined with our ability to connect global food science and technology with deep local expertise and taste allows us to innovate in ways that are meaningful, trusted and locally relevant. Some high-growth areas where Kerry is strategically positioned to win include foodservice in the Middle East, given our expertise and given our presence in a market that's growing at 7% per annum. Our presence in the rapidly evolving refreshing beverage market in Africa, where 60% of the population is under 25 and per capita consumption is less than half the global level.

Reformulation for cost and efficiency is also a driver of our growth here. And the new front of pack labeling requirements expected in Southeast Asia, in China in the coming years, this will support a step-up in product nutritional reformulations. So to summarize on APMEA, our local investments, technology, scale and customer partnerships give us a structural advantage, positioning us to outperform across the medium and long term.

So finally for me, I'd like to spend a moment on reformulation and renovation, which is increasingly becoming a driver of our consistent market outperformance. Let me first paint the picture of the regulatory landscape. If we look back to 2015, front-of-pack nutritional labeling, these regulations were relatively new and limited predominantly to Australia, a few countries in Europe, with many of them voluntary. Fast forward to today, and front-of-pack labeling is truly global, including in Canada, several countries in Latin America, where mandatory labeling is being implemented. And there are further policy updates expected in the U.S., in India, in China, in Southeast Asia in the coming years. Each of these changes drives opportunity for Kerry.

And when you combine this with the tailwinds we have in other areas of renovation that I mentioned earlier, like reformulation for cost challenges, supply chain shortages like the citrus situation or what we've seen in cocoa, or improving sustainability credentials of products, we feel renovation will be an underpin of our growth for many years to come.

So with that, I'll now hand you over to Elizabeth.

Thanks, Edmond. You've just heard Edmond talk about where Kerry is going, and you'll hear from Marguerite shortly about how we're delivering disciplined profitable growth. My role this morning is to talk about why the market itself is working in our favor globally because the global food and beverage market today is anything but static. It is large, it is complex and only becoming more dynamic. Change is accelerating, consumer expectations are shifting faster. In fact, more than 70% of global consumers say their food and beverage preferences have changed in the last 3 years. And over half expect brands to adapt faster on health, sustainability and value. That kind of environment rewards capability, agility and relevance at scale. That's where Kerry thrives and what our portfolio is built for.

Now let's go to where growth is truly happening and why Kerry has a unique scalable advantage. I'd like to share a number of examples of these growth drivers across channels and categories where the food and beverage landscape is being reshaped, starting with high protein. Protein is no longer a trend in food and beverage. It's a design requirement. In the United States, foods with protein claims are growing at over 7% CAGR, while nonprotein products remain in the low single digits. And protein has moved far beyond sports nutrition into snacks, beverages, bakery, meals and even food service. GLP-1 adoption is accelerating this shift.

But protein is hard. It stresses taste, texture, shelf life and processing, often forcing trade-offs that limit scale. While we don't specifically produce protein, we integrate and layer our taste and biotechnology solutions to unlock potential of protein and help customers deliver high-protein products without compromise, turning protein into great tasting everyday nutrition no matter the protein source and at scale. A great example is meat snacks. Meat snacks are one of the fastest-growing protein segments and clean label products are driving this growth. We were given a challenge, an emerging meat snack brand on the verge of national breakout, scaling rapidly as consumers leaned into high-protein snacking. To sustain that growth, they needed a clean label preservation solution, offering longer shelf life and 0 impact to taste at speed while maintaining their premium brand equity.

Kerry delivered a biotechnology-based preservation solution that allowed this rapid scale, unlocked national distribution and created a platform for the brand to fully participate in the category's growth.

Next, we couldn't talk about high protein without talking about beverage. Protein has transformed beverages. Consumers want more protein than ever before. 20 grams in 1 serving isn't enough. We partnered with a market-leading brand as it moved its core products from 20 grams to 30 grams of pea protein per serving to stay competitive. For this type of beverage, that kind of protein increase puts taste and texture at risk. Kerry solved that challenge by masking protein off notes and delivering a premium indulgent chocolate experience, clean label, cost-effective and consumer preferred, raising the category bar on taste.

The next major growth engine is reformulation, and it may be the most underestimated. As Edmond articulated in North America, over 60% of new food and beverage activity today is reformulation. That is not defensive, it is strategic. Customers are reformulating to improve nutrition, simplify labels, reduce environmental impact and manage cost often all at once. That level of complexity demands a different kind of partner.

I'll give you one example on a global scale. We are enabling one of the world's largest bakeries as it executes sweeping change, cutting sodium and sugar by more than 50%, removing artificial ingredients, shifting to clean label preservation and replacing egg to reduce supply chain risk. Each move impacts taste, texture, shelf life, cost and operations. Kerry solved those challenges through integrated taste and biotechnology, enabling reformulation at global scale without sacrificing consumer preference.

A second example, reformulation for modernization, working with one of the largest global food companies to modernize an established condiment and sauce brand in a mature mainstream category. The objective wasn't nutrition first. It was taste, delivering a more premium savory experience that could reengage consumers for the brand. Kerry applied its deep vertically integrated fermentation expertise to develop natural Umami taste solutions that deepen flavor, enhanced richness and improved mouthfeel without relying on artificial ingredients. The result was a differentiated, renewed premium taste experience in a category primed for evolution for a brand that will now maintain its identity as a market share leader.

Now let's move from macro trends into categories that are outpacing the market and why we are set up to succeed. If you want to see a truly dynamic pocket of growth globally, follow chicken. It's affordable, versatile and growing faster than any other protein source. Consumption is shifting rapidly towards value-added formats, emerging fast-scaling restaurant concepts, cleaner labels, reduce sodium and improve nutrition without sacrificing taste. Chicken innovation today is not about a single attribute. It's about the entire eating experience. Kerry delivers that experience, taste, texture, yield, shelf life, color and nutrition. These integrated layered capabilities are what allow customers to win in one of the fastest-moving categories in food and beverage.

For example, more protein into chicken. Yes, that's right, more protein into protein. This processor wanted to create a snackable chicken product with 23 grams or more of protein per serving, up from the typical 14 grams today. Their ask was direct, add meaningful protein without compromising taste, texture or processability. Kerry delivered the solution by integrating our proprietary broth technology, a unique extraction from chicken bones, delivering authentic savory taste with high-quality collagen and protein. This differentiated protein source was then layered and integrated directly into the Kerry developed texture system, a strong example of proprietary technology translated into scalable commercial solutions.

We also couldn't talk about chicken without talking about chicken chains, the fastest-growing segment of foodservice. This fast-growing emerging chicken restaurant chain has been riding the wave of viral demand. Like many concepts in this space, they handcoat fresh chicken back of house, which creates real challenges around food safety, shelf life and operational consistency as the business scales. The ask, extend fresh chicken shelf life by 6 days without changing the product or the eating experience. Through biotechnology, Kerry delivered a natural shelf life extension solution, allowing the customer to do exactly that. We reduced waste, improved food safety and unlocked major operational efficiencies, critical for rapid expansion.

Now let's move to our next growth category, coffee. As Edmond mentioned, coffee remains one of the most dynamic beverage categories globally. Nearly half of U.S. adults had a specialty coffee yesterday. Growth is driven by premiumization, rapid growth in RTD, cold brew expansion in foodservice to drive margins and traffic and emerging functional claims. Simply put, consumers want coffee that does more, but still tastes exceptional. That creates real complexity. Coffee must deliver premium flavor while managing betterness, stability and shelf life. It requires consistent sustainable sourcing, and it has to work flawlessly, whether it's on shelf or back of house. That is where Kerry stands out.

A first example comes from functional coffee. These products sit at the intersection of 2 powerful trends: premium coffee and high-protein nutrition. Kerry enabled a leading brand in this space to deliver 20 grams of protein with just 1 gram of sugar and under 100 calories per serving, while maintaining a smooth premium coffee profile. And that required far more than a coffee extract. That required end-to-end capability across coffee, sugar reduction, masking and mouthfeel, all under one roof, layering taste and biotechnology in a way that made this product possible at scale.

A second example shows how beverage categories are blurring even further. As consumers look for refreshing low-sugar alternatives to soft drinks, we are seeing rapid innovation at the intersection of coffee and soda. The challenge was clear, created coffee-based soda approachable and on trend with a bold, refreshing and authentic coffee taste experience and under 50 calories per serving. Kerry helped make that possible by combining premium coffee extracts with vibrant consumer-preferred flavor systems, delivering a refreshing coffee soda as a category disruptor.

And finally, supplements. This is one of the fastest-growing global opportunities. Supplements are now mainstream, spanning grocery, mass, e-commerce and even foodservice. Growth is driven by science-backed nutrition targeting specific need states, digestive health, women's health, stress, mood, metabolic health. And as formats shift to gummies, powders and beverages, taste matters more than ever. This is where Kerry is uniquely positioned at the intersection of nutrition, clinical science, taste optimization and regulatory expertise for supplements that are effective, compliant and consumer preferred.

One example in a quickly accelerating GLP-1 support space. We partnered with a leading brand to develop a GLP-1 support gummy for consumers navigating their weight loss journeys. The objective was simple but ambitious, deliver digestive support, cellular energy and stress relief in one convenient format. The formulation leveraged Sensoril, a branded Kerry botanical extract supported by 15-plus clinical studies, including one showing a 62% reduction in everyday stress over 60 days. The result is a differentiated, science-led and meaningful supplement, improving the quality of life for GLP-1 users.

A second example shows how supplements and beverages are converging in Asia, even in foodservice. We partnered with a leading juice and smoothie food service operator in Asia to launch skin health functional boosters, responding to a rising demand for holistic wellness. Kerry combined collagen with Plenibiotic, a clinically backed postbiotic supporting both skin and gut health, creating a differentiated science-led solution. Delivered in just 1 month, this became the first functional supplement of its kind in regional food service, turning everyday drinks into a new platform for growth.

In close, what ties all of this together is not a single category. It's complexity. Dynamic markets reward partners who can move fast, scale reliably and solve multiple problems at once. Kerry's model layering taste and biotechnology is built exactly for this environment. We don't need the market to be stable, and we don't need categories to grow evenly. We win when customers need to adapt.

So as you think about the food and beverage landscape, I'll leave you with this thought. Growth hasn't vanished, it has moved. It means selective but scalable opportunity and momentum, and those opportunities reward companies that are technically strong, deeply embedded and designed for change. Change is not a barrier for Kerry. It's the environment we are built for.

I'll now turn you over to Marguerite.

Thanks, Elizabeth. Some really excellent examples highlighting significant growth opportunities and how we've been able to consistently outperform within our markets. Today, I'm going to give you an overview of our track record of strong business performance, our track record of growth-led financial model and our disciplined and balanced strategic capital allocation framework.

To start, I would like to update you on our performance versus our key metrics and medium-term targets. Having just completed the fourth year of our plan, I'm pleased to say we have made good progress across each of the key pillars of growth, returns and sustainability. Starting with volumes. We've averaged 3.8% growth in this time frame, which represents a significant market outperformance of over 300 basis points. On the EBITDA margins, we have delivered strong progress over the past number of years, and we are well on track to achieve our 2026 target range in the year ahead and our 2028 target of 19% to 20%.

We have a target of high single-digit plus earnings per share growth up to 2028. We have delivered 7.5% constant currency adjusted EPS growth in 2025 and are planning on 2026 being another high single-digit EPS growth year. On returns, we have stepped up our cash generation with cash conversion above 80% and return on capital employed improvements in recent years. And on sustainability, we have made great progress against our targets, reducing carbon by 52%, food waste by 54% and increasing our nutritional reach to almost 1.5 billion consumers globally.

I will now take you through each of our financial metrics in turn. So beginning first with volume growth. Our consistently strong end market outperformance of over 300 basis points highlights the strength and relevance of our business in supporting customers as they adapt to address changing consumer and market needs. On the right, you can see we have delivered strong performance across our key growth differentiators over the last number of years, including average foodservice volume growth of 9% and average emerging markets growth of 7%, demonstrating how we are effectively executing on our strategy across these dimensions.

This strong track record of growth across foodservice and emerging markets, combined with the increased focus on product innovation and renovation gives us confidence that we will continue to deliver strong market outperformance over the medium term.

Now turning to our EBITDA margin development. We have significantly expanded our EBITDA margins in recent years with 320 basis points of margin expansion since 2021 through portfolio transformation, efficiency initiatives across the organization and through delivering operational leverage and mix benefits aligned to the growth and development of the business. We have a target of being in the 19% to 20% margin range by 2028. Our Accelerate 2.0 business efficiency program, along with the continued delivery of operating leverage and mix benefits, consistent with our performance in recent years. underpin the achievement of our future EBITDA margin expansion plans. We will continue to balance our margin expansion plans with our business growth ambitions.

Now to take a moment to update you on Accelerate, which has been and will continue to be a key driver of margin expansion. In 2025, we completed Kerry Accelerate operational excellence, which focused on delivering manufacturing and supply chain excellence and efficiencies. The program's successful completion is delivering recurring annual benefits ahead of projections and established a strong foundation for Accelerate 2.0, which will run until 2028, driving continued margin expansion through footprint optimization and embedding digital excellence across the organization.

We initiated Accelerate 2.0 as planned during the year with good progress in both North America and Europe with the commencement of footprint optimization, including the disposal of some related business activities. We have reduced our manufacturing footprint from 124 facilities to 119 at the end of '25, and we'll continue to optimize this as appropriate in the coming years. Our digital excellence program is well underway, and we are making good progress. Some of the digital initiatives we advanced during the year include utilizing agentic AI to expand automated decision intelligence, increasing the use of robotic process automation at our global business centers, delivering efficiencies and unlocking capacity, rolling out initiatives under connected plant in our manufacturing operations, including digitally enabled predictive maintenance and commencing the use of digital manufacturing twins to simulate and standardize execution, reducing variability and increasing production yields and throughput.

And on commercial, we're continuing to drive improved customer experience, leveraging our KerryNow customer portal, which provides our customers with real-time 24/7 access. Our continued progress on digital automation and scaling AI across our business is supporting -- is supported by our recognition as a frontier firm by Microsoft. These initiatives are improving our customer and employee experience, driving improved productivity and profitability while supporting growth and business development. We will continue to update as we progress on Accelerate 2.0 which, as a reminder, is expected to deliver a recurring annual benefit of circa EUR 100 million by 2028 at a total cost of circa EUR 140 million.

Turning to free cash flow and returns and starting with cash. We have consistently achieved our cash conversion target and delivered good free cash flow over the plan. This has been supported by strong working capital management, enabled by our Accelerate Operational Excellence program and the establishment of our 2 global business services centers in Malaysia and Mexico. We feel confident in our outlook as regards cash, and we are expecting to deliver good free cash flow generation and cash conversion of 80% plus in 2026.

Moving to return on average capital employed. We have delivered a 60 basis points increase in our returns to 10.6% in '24. And in '25, we delivered a further underlying improvement of 20 basis points, offset by a negative year-on-year currency effect. We will continue to build on this progress, and we expect to increase our returns towards 12% over the coming years.

Moving to our capital allocation priority framework, which is well balanced between reinvestment in our business and capital returns. Our first priority is capital investment, where we will strategically invest 4% to 5% of our revenues to support our growth-led approach. Secondly, on dividends, we will maintain our track record of double-digit percentage per share growth. And thirdly, we will continue to evaluate M&A investment opportunities aligned to our strategy that enhance our technology portfolio, strategic positioning or market access. And finally, we will continue to balance M&A investment opportunities with returning capital to shareholders through share buybacks. Our objective is to have an efficient balance sheet while retaining the agility and flexibility to allocate capital to where we believe we can generate the greatest value.

Looking at our recent capital allocation under each of the 4 areas. On capital investment, we have invested in expanding our manufacturing footprint as well as our technology and innovation infrastructure and capabilities, as Edmond mentioned, supporting the delivery of our business growth plans across the globe.

Next to M&A, where we have significantly evolved and rotated our portfolio in recent years through a combination of business divestments and strategic acquisitions, supporting the build-out of our biotechnology capabilities and further development of our authentic taste portfolio through targeted acquisitions aligned to our strategic growth ambitions. On dividends, in '25, we paid dividends of over 200 million and have grown our dividend at a consistent double-digit rate since Kerry went public. And on buybacks, since November '23, we've announced EUR 1.5 billion of share buybacks, repurchasing EUR 500 million of shares in 2025. So overall, on capital allocation, we will remain agile and flexible as regards balancing capital deployment between strategic reinvestment in our business and capital returns aligned to market conditions as we seek to generate value and deliver on our medium-term targets.

So finally, to recap on the key drivers of our earnings growth algorithm. Firstly, volume growth. We've consistently outperformed our markets by 300 basis points plus over the past number of years. On margins, we've expanded our EBITDA margin by over 300 basis points in the past 4 years, and we're on track for our margin target of 19% to 20% by 2028. On cash, we've delivered consistent cash conversion above 80%. And these 3 key drivers have supported our high single-digit constant currency adjusted earnings per share growth in 2024 and 2025, and we're looking for another year of high single-digit growth in 2026.

And with that, I'll briefly hand you back to Edmond.

Thanks, Marguerite. I'd just like to close by reiterating the 3 messages that I began this presentation with. Our focus at Kerry continues to be on executing against our strategy, evolving our business while outperforming our markets, where significant opportunity exists, as you will have seen from Elizabeth's section through both innovation and renovation, combined with the progress we're making in evolving our business, including the next level of digital enablement, driving continued margin expansion while supporting our growth agenda. We believe that the combination of all these factors will be the key drivers of our continued earnings compounding into the coming years. Thank you.

Good morning, and thank you for standing by. My name is John, and I will be your conference operator today. At this time, I would like to welcome everyone to the Kerry Group Full Year 2025 Results Call. [Operator Instructions]

I would now like to turn the call over to William Lynch, Head of Investor Relations. Please go ahead.

Thank you, operator. Good morning, and welcome to Kerry's Full Year 2025 Results Call. I'm joined on the call by our CEO, Edmond Scanlon; and our CFO, Marguerite Larkin. Edmond and Marguerite will take you through today's presentation. And following this, we will open up the lines for your questions. Before we begin, please take note of our disclaimer regarding forward-looking statements.

I will now hand over to Edmond.

Thanks, William. Good morning, everyone, and thank you for joining our call. Beginning with the overview of 2025 on Slide 4 and starting with performance. We're pleased to report that we delivered another year of strong end market volume outperformance, margin expansion and earnings per share growth. While overall market volumes remained relatively subdued through the year, we continue to demonstrate our ability to consistently outperform our end markets with volume growth of 3%, highlighting the strength and relevance of our business. This growth was driven by a strong performance in the Americas throughout the year, led by foodservice innovation and increased nutritional renovation across a broad range of customers, given our positioning as a leader in sustainable nutrition with customers looking to address nutrition, taste, cost or sustainability aspects. We also delivered strong margin expansion of 80 basis points, with EBITDA margins just under 18%. And we're well on track to achieve our margin targets, which we will give you more color on later.

Moving to earnings. We delivered constant currency EPS growth of 7.5% in 2025, which is stated after the dilution from the Dairy Ireland disposal in the prior year. This was on top of the 9.7% growth we delivered in 2024, and we're looking to achieve another year of high single-digit EPS growth in 2026. Earnings compounding has always been an important part of Kerry's story, and we reaffirm this with our high single-digit plus EPS growth target out to 2028 when we refreshed our margin and EPS targets last year.

From a strategic perspective, we continue to evolve our business through targeted capital investments and portfolio development activity, enhancing our technology capabilities, supporting new innovations and delivering even more value for our customers. Just to touch on some of the key developments in the year. Firstly, on technology capabilities. These included the opening of our new state-of-the-art Biotechnology Centre in Leipzig in Germany, and a number of other technology developments, which I'll outline later when we look at each of the regions.

On innovations, key innovations in the year included our next generation of fermentation-derived Tastesense Sweet and Salt reduction technology ranges; the launch of our new Plenibiotic postbiotic for digestive and skin health; a breakthrough enzyme system, which delivers significantly more effective natural sweetness; new fermentation-based solutions under our Kerry experience portfolio; and new natural cocoa replacement systems, which replicate authentic cocoa taste using less than half the cocoa raw materials.

And on footprint and customer access, we extended our APMEA manufacturing presence into Egypt, and within East Africa while expanding our capacity in the Middle East and Southeast Asia. And we strengthened our customer innovation network through new centers in Frankfurt, Indonesia and Dubai. So to summarize, 2025 was another year of strong market outperformance, combined with continued strategic developments.

Moving next to the business performance overview. We achieved group revenue of EUR 6.8 billion and EBITDA of EUR 1.2 billion. Volume growth was 3% for the full year and 2.8% in Q4, well ahead of food and beverage end markets, driven by good innovation activity and continued product renovation activity with our customers. Pricing was pretty flat in the year, with input costs turning deflationary in Q4. EBITDA margins were up 80 basis points, driven by accelerated efficiencies, portfolio developments, operating leverage and mix. Across our technologies, we had good growth across savory taste, Tastesense Salt and Sugar reduction technologies, botanicals, natural extracts, proactive health ingredients, taste solutions for high-protein applications, enzymes and biofermented ingredients.

From a channel perspective, foodservice achieved volume growth of 4.6%, supported by strong innovation activity, including new menu items and seasonal launches. Growth in the retail channel was supported by a step-up in retailer brand innovation and renovation activity to enhance the nutritional profile across a range of customers. And finally, growth in emerging markets of 5.3% was led by a strong performance in Southeast Asia and LatAm.

Moving next to our end-use market breakdown. Starting with the food EUM, where all categories delivered volume growth. In snacks, we had good growth, driven by our savory taste and Tastesense Salt reduction technologies. And in bakery, growth was driven by our enzymes preservation and taste systems. Moving to beverage, where growth was supported by the performance of our Tastesense Sugar reduction technologies, natural extracts and proactive health ingredients. And we had good growth in pharma through our proactive health technologies into supplement applications.

Turning next to performance by region and starting with the Americas, where we had continued strong performance across both North America and LatAm. Revenue for the region was EUR 3.7 billion, with full year volume growth of 3.8% and 4.4% in Q4. EBITDA margins increased by 60 basis points to 20.3%. In North America, growth was again led by snacks, along with the dairy and bakery end-use markets as we enabled our customers to innovate and renovate within categories. By channel, we had good growth in foodservice through strong innovation activity despite soft traffic in places, and with good growth in retail across global, challenger and retailer brands, particularly around the area of improving nutritional profiles.

Within LatAm, strong growth was achieved in Brazil and Central America across the snacks and meals end markets in particular. And in business developments in the region included investment in enhancing our coffee taste extraction capabilities in Pennsylvania, which continues to be an area of innovation focus for our customers across many different food and beverage applications.

Moving to Europe, where a soft finish to the year meant volumes were slightly back in 2025. Revenue in the region was EUR 1.4 billion, with EBITDA margins increasing by 90 basis points. We had good volume growth in beverage across nutritional and refreshing beverages, with our integrated taste technologies and proactive health ingredients. Volumes in the retail channel reflected subdued market conditions, while foodservice achieved good overall growth despite a soft finish to the year. And business investments in the region included the expansion of our enzyme capacity in Ireland and our cocoa taste capabilities in Grasse in France.

Moving next to the APMEA, where we had a good overall performance given market disruption in places. Revenue for the region was EUR 1.6 billion, with volume growth of 4.2% and EBITDA margin expansion of 70 basis points. Growth was primarily driven by Southeast Asia with solid growth in the Middle East and Africa and volumes in China remaining challenged. Across our end markets, growth was led by bakery through food protection and preservation systems as well as reformulation activity in areas including cocoa. Growth in our channels was led by foodservice with leading regional coffee chains and quick service restaurants, while growth in retail was led by good performance in taste with regional leaders. Finally, business developments across the region included new manufacturing facilities in Egypt and Rwanda, combined with continued expansion of capacity in the Middle East and Southeast Asia.

And with that, I'll hand you over to Marguerite for the financial review.

Thank you, Edmond, and good morning, everyone. Turning to Slide 12 and beginning with our financial overview. We achieved group revenue of EUR 6.8 billion in the year, reflecting volume growth of 3%, which represented a strong end market outperformance. EBITDA increased to EUR 1.2 billion, reflecting 5.7% organic growth. We delivered strong EBITDA margin expansion of 80 basis points, adjusted earnings per share growth of 7.5% in constant currency and 3% in reported currency. Return on capital employed was 10.6%, with underlying improvements being offset by a negative year-on-year currency effect of 20 basis points. And we achieved good free cash flow of EUR 643 million, representing an 81% cash conversion.

Turning next to our group revenue bridge on Slide 13. Volume growth was 3%, as I mentioned, with slightly lower pricing of 0.3% and a transaction currency benefit of 0.1%. Foreign currency translation was 3.9% adverse due to the significant movement in the U.S. dollar and emerging market currencies versus the euro in the year. And acquisitions net of disposals was a net decrease of 1.4% in the period with disposals primarily relating to, firstly, the prior year revenue associated with the exit of a manufacturing agreement with Kerry Dairy Ireland, as previously communicated. And secondly, disposal of some noncore activities in Europe and North America to enable the efficient execution of our Accelerate 2.0 footprint optimization strategy and the contribution from acquisitions, primarily relating to the lactase enzyme business.

Moving now to our group margin bridge on Slide 14. We are pleased with the strong EBITDA margin expansion of 80 basis points in the year. Looking at the key moving parts. Firstly, on operating leverage and mix, we had a 20 basis points improvement, with both operating leverage and mix contributing to the expansion. Our Accelerate programs contributed 40 basis points. This was primarily attributable to Accelerate Operational Excellence, which was successfully completed in the year, delivering annual recurring benefits ahead of expectations. We also initiated Accelerate 2.0 with initial benefits coming through in the final quarter.

Foreign currency was a headwind of 10 basis points, and acquisitions and disposals contributed to a net positive 30 basis points, with 10 basis points from acquisitions and 20 basis points from disposals, as mentioned. Overall, we are well on track to achieve our targeted margins of 19% to 20% by 2028.

Next, to free cash flow on Slide 15. We generated good free cash flow of EUR 643 million in the year, representing cash conversion of 81%. The main drivers were, firstly, our EBITDA increased year-on-year, as I just mentioned, noting that 2024 free cash flow comparative includes the contribution from Kerry Dairy Ireland.

On the average working capital, the increase was driven by lower trade payables, mainly attributable to sourcing alternatives implemented as part of our tariff mitigation strategy and new procurement initiatives with some strategic suppliers. Point-to-point working capital was higher due to exceptionally low working capital days at the prior year-end and timing of other receivables at the year-end. The increase in net finance costs paid is principally due to the timing of bond interest payments across 2024 and 2025. And our net capital investment aligned to our strategic growth areas was EUR 300 million as we continue to invest to support our growth through the extension of our technology capabilities and capacities in all 3 regions, as Edmond referenced.

Now turning to our debt profile and credit metrics on Slide 16. As you can see, the profile of our EUR 2.2 billion net debt is good, with a weighted average maturity of 6.5 years and no significant repayments until 2029. Our credit metrics are strong with a net debt-to-EBITDA ratio of 1.9x, and we have a very strong balance sheet, which will continue to support the further development of our business.

Now to update you on Accelerate on Slide 17. In 2025, we completed Kerry Accelerate Operational Excellence, which focused on delivering manufacturing and supply chain excellence and efficiencies. The program's successful completion is delivering recurring annual benefits ahead of projections and has established a strong foundation for Accelerate 2.0, which will run until 2028, driving continued margin expansion through footprint optimization and embedding digital excellence across the organization.

We initiated Accelerate 2.0 as planned during the year with good progress in both North America and Europe with the commencement of footprint optimization, including the disposal of some related business activities. We have reduced our manufacturing footprint from 124 facilities in 2024 to 119 at the end of 2025, and we will continue to optimize this appropriately over the coming years.

Our digital excellence program is well underway, and we are making good progress. Some of the digital initiatives we advanced during the year include continued expansion of decision intelligence capability, utilizing agentic AI to automate a substantial volume of operational decisions in key areas of the business, including supply chain, new product development and enablement functions.

At our GBS centers, we increased the use of robotic process automation to improve efficiencies and unlock capacity. In our manufacturing operations under connected plant, we are rolling out a number of initiatives, including digital-enabled predictive maintenance to optimize efficiency, related spend and asset reliability. And we commenced the use of digital manufacturing twins to simulate and standardize execution, reduce variability and increase production yields and throughput.

From a commercial perspective, we are continuing to drive improved customer experience, leveraging our KerryNow customer portal, which provides our customers with real-time 24/7 access. These initiatives will improve our customers' and employees' experience, drive improved productivity and profitability while supporting growth and business development. Our continued progress on digital automation and accelerating how we scale AI across the business, supported by our recognition as a Microsoft Frontier firm will be an important enabler of our margin expansion targets.

We will continue to update you as we progress on Accelerate 2.0, which, as a reminder, is expected to deliver a projected recurring annual saving of circa EUR 100 million by 2028 as a total net cost of circa EUR 140 million.

Now moving to Slide 18 and other financial matters. Finance costs of EUR 52 million in the year reflected good cash generation and interest income. Non-trading items were an overall net charge of EUR 74 million, primarily relating to the progress we made under our Accelerate programs with the balance relating to disposals and acquisition integration activity.

On the input costs, there was deflation in the final quarter, leading to small overall deflation in the year. We are currently expecting limited overall deflation in 2026. For taxation, we had an effective tax rate of 14.1%, and the current outlook is for a tax rate of 14% to 15% in 2026. Capital returns for the year included share buybacks of EUR 500 million and dividends paid of EUR 215 million. And we have announced we will be initiating a new EUR 300 million share buyback program today. On currency, the translation headwind on earnings per share in 2025 was 4.5%. And based on prevailing exchange rates, we are forecasting a headwind of circa 4% on the EPS in 2026.

Finally, to summarize our financial performance for 2025. We are pleased with our overall performance where we delivered volume growth well ahead of our end markets, strong EBITDA margin progression, which supported continued good earnings per share growth.

And with that, I'll pass you back to Edmond.

Thanks, Marguerite. Before we move to our outlook for 2026, we'd like to give a progress update on our key metrics and medium-term targets on Slide 20.

Having just completed the fourth year of our plan, we've made good progress across each of the key pillars of growth, return and sustainability. Starting with volumes. We've averaged 3.8% growth in this time frame. And while it's a little lower than where we'd like it to be, it's important to recognize that this represents a significant market outperformance of over 300 basis points.

On EBITDA margins, we've delivered strong progress over the past number of years. We will achieve our 2026 target range in the year ahead, and we are well on track to achieve our 2028 target of 19% to 20%. You'll recall, we reinstated EPS growth as a key measure last year with our targets of high single-digit plus EPS growth up to 2028. Earnings compounding has been a key feature of Kerry's history, and we're laser-focused on delivering consistent high single-digit plus earnings growth.

On returns, we stepped up our cash generation with cash conversion above 80% and ROACE improvements in recent years. And on sustainability, we've made great progress against our targets, reducing carbon by 52%, food waste by 54% and increasing our nutritional reach to almost 1.5 billion consumers globally.

Finally, moving to the 2026 outlook. Our continued strong end market outperformance highlights the strength and relevance of our strategic positioning across our markets, channels and customer base. We will continue to further advance our strategic business development while supporting our customers as their innovation and renovation partner. We remain strongly positioned for volume growth and margin expansion with a good innovation pipeline despite the soft consumer demand environment. And we expect to deliver constant currency adjusted earnings per share growth of 6% to 10% in 2026.

Before we move to Q&A, on behalf of the Board and the senior management team, I'd like to acknowledge our outgoing Board Chair, Tom Moran, who will be retiring following our AGM this year. Throughout his tenure as Chair, Tom provided strong Board leadership, particularly through the business transformation we undertook in recent years. We'd like to sincerely thank him for his valued contribution to Kerry over his tenure, and wish him the very best in the future.

Fiona Dawson has been named Chair Designate. Fiona has been a Non-Executive Board Director since 2022, and brings deep industry experience given her executive career in the consumer food and beverage sector. A full announcement has been published this morning with further details.

So with that, I'll hand you back to the operator, and we look forward to taking your questions.

[Operator Instructions] Our first question comes from the line of Patrick Higgins with Goodbody.

A couple of questions on top line kind of outlook, maybe one for Edmond and one for Marguerite. Just in terms of volumes, Edmond, how should we think about volume growth for the year ahead? How should we -- how are you viewing end markets versus the kind of flattish that you've been flagging in the past year? And maybe talk through the regional outlook.

And then, Marguerite, on input cost inflation, you flagged limited, so I assume that means limited pricing as well. How should we think about pricing? But then also disposals, obviously, disposals a bit of a feature in '25. KDI now has been lapped. Should we expect more disposals associated with the Accelerate program?

Thanks, Patrick, and I'll kick off here. So just in terms of the volume outlook, we're taking a similar approach in 2026 as how we approach 2025 at this time of the year. So currently, we're seeing overall market volumes being similar to last year. Against the backdrop, we're looking at our volumes being in the same zone as we had in 2025.

In terms of the outlook by region for 2026, as you can see, the Americas had a very good year in 2025 with volume growth of 3.8%, 4.4% in Q4, and we look to continue that strong market outperformance in 2026. I think then in Europe, let's say, volumes are back overall in 2025, and we would expect to be in growth in 2026. And in the APMEA region, we're looking to make progress in 2026 well into that mid-single-digit volume range and moving towards high single-digit volume growth for the region over the next year or 2.

And maybe just I'll finish in terms of channel. We're looking at volumes in the foodservice channel to continue to outperform and to be ahead of retail in 2026 as well.

And Patrick, just on your 2 other points. Firstly, on the input costs and pricing. For 2026, we currently expect some limited overall deflation in the year on the input costs. And as you say, consequently, some limited deflationary pricing.

In terms of the disposals and the outlook for 2026, we made very good progress, as you will have seen on our footprint optimization plan during 2025. And in terms of the impact of those in 2026, you should expect disposal revenues of circa EUR 60 million or less than 1% of revenues from those divestments. Based on current plans, we expect limited further business disposals in connection with the footprint optimization.

Your next question comes from the line of Ed Hockin with JPMorgan.

My first one is on Europe that took a bit of a step back in volumes in Q4, whether you could elaborate a bit how you're expecting this region to perform going forward, especially now you've got the new President of the region, Marcelo. What is it you think he can be doing to try to stimulate volumes growth in the region, which has been flat to slightly negative for the past 2 years?

And then my second question, please, is coming back on the channel mix, it looks as though foodservice accelerated a bit in Q4, and you say foodservice should be ahead of retail in 2026. Can you maybe give us an indication how you're seeing some of the kind of KPIs of traffic and reformulation activities, limited time offerings, promotional intensity with your customers and how you'd expect some of those leading indicators, how they're looking now and expect them in 2026?

Thanks, Ed. The key change in Europe in the quarter was soft volumes in the foodservice channel towards the very end of the year. So year-to-date September, foodservice in Europe achieved mid-single-digit volume growth, and then volumes turned negative at -- towards -- in Q4, and that was partly due to year-on-year performance of seasonal products and LTOs in the channel as well as traffic in general. And retail volumes were slightly back in the quarter and in the full year as well.

I think in terms of, let's say, our approach to Europe, I mean, obviously, it's going to take a little bit of time. The dynamics in Europe versus North America are quite different. That said, we do expect 2026 to be better than 2025. We will be in positive territory in 2026. And look, let's see how the year progresses.

Then maybe your question with regards to foodservice. And let's say, North America being a key driver of that. Despite flat to negative traffic in North America, we had very, very strong growth, and we're very pleased with the overall performance in foodservice in the final quarter.

And maybe just to give some details on that on the quarter itself, we did have significant launch activity in Q4. We had flagged that, that level of activity was quite elevated. The second thing was the performance of LTOs was strong and slightly ahead of expectations. The reality is that limited time offerings and seasonal offerings are actually at an all-time high in the foodservice channel as players continue to strive to connect and reconnect with as many consumers as they possibly can and to try and bring as much excitement to the menu as they possibly can. And then the third point is we did see also an increased level of customer promotion activity as well also in the quarter, and that promotional activity for sure impacted -- positively impacted our performance in Q4.

In terms of let's say, the go forward, I think it's fair to say, look, we had an exceptional Q4 in foodservice. We don't expect, let's say, every quarter to repeat what we saw in Q4 2025. With that said, we do expect another strong year of performance in foodservice. And like we've said in the past, we believe we can deliver at least 400 basis points on average market outperformance in that channel, and our view hasn't changed.

I think in terms of, let's say, the key underpins there, we have to wait and see. Will that level of promotional activity continue into 2026? I think based on, let's say, what we saw at the end of '25, I think customers would be encouraged to continue on that promotional activity, and we don't see any let-up in LTOs.

In terms of reformulation, specifically within the foodservice channel, reformulation there is more kind of around value offerings. And it's also about -- it's also about, let's say, trying to bring excitement to the menu. So probably less of a feature is nutritional reformulation within the foodservice channel, that's more so in the retail channel. And I would say, reformulation in foodservice is around cost and around bringing as much efficiency to that operator as possible. And we don't see that changing as we look out into 2026.

Our next question comes from the line of Alex Sloane with Barclays.

A couple of questions from my side, if that's okay. Edmond, if I can just sort of dig in on Europe a little bit further. So obviously, slightly weaker in the fourth quarter. You've explained that was kind of foodservice, but an outlook to be in growth for '26. Could you just talk to the kind of phasing there? I mean, could we be expecting it in the first half to be in growth? Or is this more kind of a second half phasing to that recovery?

And the second one for Marguerite. The net debt was a bit higher than consensus for the full year, free cash flow a bit lower. I wondered, is there any kind of one-offs or phasing impacts within that free cash flow delivery, perhaps on working capital? Or is it just a case that consensus was in slightly the wrong place?

Thanks, Alex. I'll kick off here. I would say, from an overall perspective, so from a total group perspective, we wouldn't be calling out any phasing as we look into 2026 across the quarters as we sit here today. But in Europe, we do see, let's say, that, let's say, improvement of that progression basically happening over the course of the year, probably slightly second half weighted rather than first half. But at a corporate level, we wouldn't be calling out any kind of phasing H1, H2, but specifically in Europe, maybe slightly more H2 weighted.

And Alex, just on the free cash flow and working capital, yes, there are some timing impacts at the year-end. Our working capital days are a little bit higher than we expected. And maybe just to give you a little bit of color and context. Firstly, it's important to note that the 2024 year-end working capital days of 29 days were exceptionally low. And we said at the time, you might recall, that working capital days in the mid-30s was a more normalized level. And our working capital days at the year-end came in at about 41 days, which as I referenced, is a little higher than we expected.

A couple of drivers on the year-on-year increase. Firstly, lower trade and other payable days. And 2 primary drivers within that. Firstly, mainly due to business decisions taken on sourcing alternatives implemented primarily as part of our tariff mitigation strategy and also reflects some new procurement initiatives with certain strategic suppliers. The second component, more of a timing one, reduction year-on-year in relation to performance-related incentives. And then the second component on our working capital, we had higher trade receivables just given organic revenue mix in the second half of the year, which was driven by the Americas and APMEA and some timing on other receivables, which will reverse in 2026.

In summary, I would say, Alex, we expect working capital days to move back to between circa 35 and 40 days in 2026. And we expect FY '26 to be a year of good cash conversion of 80% plus and similar or better on a point-to-point basis. So hopefully, that gives you some better context on the moving parts.

Our next question comes from the line of Fulvio Cazzol with Berenberg.

Yes. I suppose most of my questions have been answered, but I was just going to ask a question on capital deployment, how your M&A pipeline is looking? Are you looking to potentially add any other technologies or businesses in some of the more strategic developing markets? If you can just add a bit of color on anything you see there.

Yes. Thanks, Fulvio. In terms of M&A, we did make 2 small bolt-on acquisitions through the course of 2025, one in the area of coffee extraction that we talked about earlier in the year, and that helped us to increase both our capability and capacity for coffee extraction, a key, I would say, a growth area and focus for us now and into the future. And the second bolt-on was a -- or basically our first manufacturing footprint in Egypt. And Egypt is an important market in itself, but having a manufacturing footprint there not only gives us access to that market, but also gives us the opportunity to serve better the North African markets.

In terms of the pipeline going forward, basically, we're calling out 3 areas. Firstly, we will continue to look at expanding our presence in emerging markets, similar to what I just described with that bolt-on in Egypt. The second area is around proactive health. We have had a very strong performance in the year in proactive health. We see supplements as a space that has been growing close to double digits. And we feel we have already a nice portfolio in our proactive health portfolio, but we are out there looking for technologies that have strong science and clinical foundations and those opportunities are continuing to be evaluated. And the third area then is around fermentation. Again, it's a space where we have invested in recent years. We continue to invest organically, but we continue to be out there also looking for opportunities to build out our capability and capacity in fermentation.

[Operator Instructions] Our next question comes from the line of Matthew Yates with Bank of America.

Just a couple of small ones really around the Accelerate program. Just wondering, on the European performance, is there any effect here from either the footprint rationalization or a more sort of proactive and conscious decision from the management there to sort of focus on the margin at the expense of volumes? Or is this purely an illustration of sort of end market conditions?

And then just in terms of the 2026 guide, I think your bridge, your waterfall chart showed about 40 basis points of margin improvement last year from the Accelerate program. Are we talking a similar order of magnitude in '26? And associated with that, a similar order of magnitude in exceptional costs, I think it was EUR 47 million last year.

I might kick off there, Matthew, and Marguerite might want to add. As we think about Europe, and bear in mind -- or when we think about Europe, it's a Western Europe geographic, let's say, footprint that we're talking about here. Our expectations for Europe at the best of times is that we expect volume growth to be in that 1% to 2% zone. Clearly, we're shy of that at the moment. And like I said previously, we do expect Europe to be in positive territory in 2026.

In terms of margin development in Europe, despite the lower volumes, we had very strong performance in margin expansion in Europe, and that was down to the Accelerate program. We are running that program extremely well. The execution of that program is very, very strong. We closed and exited 7 facilities throughout the course of the year. That was ahead of expectations, and a significant portion of that was in Europe. But like I said, the dynamics in Western Europe have been challenging. We believe we have the right team in place. We believe they're focused very hard on the right level of customer engagement, being super proactive with customers. And we expect all that work to start paying off here as we move towards the -- as we move towards 2026.

And maybe just to add on the contribution from Accelerate. So in the context of the costs that we expect in FY '26, we expect circa EUR 50 million in the year in relation to Accelerate 2.0, as Edmond has referenced. We're making very good progress on Accelerate 2.0. It will be the primary driver of expansion in 2026. And looking overall from a margin perspective, we're looking at another year of good margin expansion of 60 basis points or greater for 2026. And as I say, Accelerate 2.0 will be the primary driver of this expansion with some operational leverage, mix and portfolio benefits coming through. So well on track in terms of that margin expansion delivery.

Our last question comes from the line of Cathal Kenny with Davy.

A quick follow-up on margin, Marguerite, is it the expectation that all 3 regions will see a margin increase in '26, just in the context of that 60 basis points or greater? And one question on the regions, China. Just interested to know the outlook for the Chinese business is for '26.

Thanks, Cathal. I might kick off here. In terms of, I guess, maybe the APMEA region, when we look at the APMEA region, we kind of look at it in 3 portions. Middle East, Africa, we continue to see solid performance there; Southeast Asia, quite strong performance; and China, while volumes were slightly back on the prior year, we did see some progression H2 versus H1, but probably not the level of progression that we expected, so slightly short of expectations.

We do feel that 2026 will be a year of progression in China. We feel that there's 2 areas in particular that we're really focusing on in terms of driving that progression. Number one is there is a shift in China with some of our key customers on the retail side that they are putting more of an emphasis on export markets. And we feel we're very well positioned to enable those customers to be successful in those export markets, whether it's into Southeast Asia or back into the Middle East and Africa.

And the second area is that there's been, I would say, a very fast acceleration from a consumer perspective around clean label and healthier products, and this is coming from some government guidelines around the 3 lows, meaning low salt, lower sugar and low saturated fat. And again, you can see based on our performance in North America and the Americas, especially around snack and bakery, we're exceptionally strong as it relates to reformulating. That has been driving growth in those end-use markets, and we expect to be deploying those types of technology solutions, both from a portfolio perspective and a capability perspective, the similar opportunities that we expect to see in China. So the market seems to be moving in our direction in China, which is a real positive. And we believe we have the portfolio and the capability to help on that reformulation drive. And that has been a key underpin of growth for us in the Americas in 2025 and 2024, and expect that to continue into 2026.

And in terms of the margin expansion, no major call-outs by region. You should expect all regions to have good margin expansion in the year ahead.

And at this time, we have no further questions. I will now turn the call back over to Kerry for closing remarks.

Thank you, everyone, for joining us on the call today. We just wanted to note that we are presenting at the CAGNY conference this Thursday, and hopefully, you get the opportunity to join us or to listen into that conference presentation where we will give further insight in terms of the strategy and the execution thereof over the year ahead and the following years. Thank you.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect your lines. Have a pleasant day.

Good morning, and thank you for standing by. My name is John, and I will be your conference operator today. At this time, I would like to welcome everyone to the Kerry Group Third Quarter 2025 Results Webcast. [Operator Instructions]

I would now like to turn the conference over to William Lynch, Head of Investor Relations. Please go ahead.

Thank you, operator. Good morning, and welcome to our Q3 2025 trading update call. I'm joined on the call by our CEO, Edmond Scanlon; and our CFO, Marguerite Larkin. As usual, Edmond and Marguerite will take you through our presentation, and we will then open the lines up for your questions. Before we begin, please note the usual disclaimer on our presentation regarding forward-looking statements.

I will now hand over to Edmond.

Thanks, William, and good morning, everyone, and thank you for joining our call. So moving first to Slide 4 and my overview comments. We delivered a good performance across the first 9 months of the year with volume growth well ahead of our markets, combined with strong EBITDA margin expansion.

Beginning with revenue, volume growth for Q3 and year-to-date was 3%, which represented a strong end market outperformance. Looking at this firstly by region, we achieved good growth in the Americas, supported by new product launch activity with both Europe and APMEA delivering sequential volume growth improvements in the third quarter.

From a channel perspective, foodservice growth of 4.1% was driven by good innovation activity across new menu items, seasonal launches and LTOs. Growth in the retail channel was supported by increased retailer brand innovation and nutritional enhancement renovation. And by technology, we had strong performances across savory taste and Tastesense Salt and sugar reduction technologies as well as enzymes, natural extracts and proactive health technologies.

Moving to margins. We delivered strong EBITDA margin expansion of 90 basis points in the period, primarily driven by Accelerate Operational Excellence, and we continue to see good margin expansion opportunity in front of us. On guidance, we remain on track to deliver our full year guidance. And finally, before we move to the performance review, I'd just like to update you on a few key strategic developments during the period.

In recent weeks, we opened our new state-of-the-art Biotechnology Centre in Leipzig, Germany, which will play an important role in supporting future, fermentation and biotransformation innovation for the food and beverage industry. In the period, we initiated our Accelerate 2.0 program, which will focus on footprint optimization and enabling digital excellence across the organization. And we also continued to invest and develop our footprints, capacity and capabilities across our regions through the period.

I'll now hand you over to Marguerite for the business review.

Thanks, Edmond, and good morning, everyone. Moving to Slide 5 and the business review. Firstly, volume growth in the period of 3% represented continued strong end market outperformance, as Edmond mentioned. Pricing of 0.2% reflected overall input cost inflation. On the EBITDA margins, we delivered strong margin progression of 90 basis points in the period and 80 basis points in the quarter, primarily driven by cost efficiency, operating leverage and product mix, along with the contribution from acquisitions and disposals.

Growth in our end-use markets was led by the Bakery, Snacks and Dairy end markets. Foodservice delivered growth of 4.1% despite soft traffic in places. Retail performed well overall, given increased customer focus on improving the nutritional profiles of their products. And volumes in emerging markets increased by 5.3% in the period, led by a strong performance in Southeast Asia.

Turning to Slide 6 now and our performance by region. Firstly, in the Americas, where we had good performance across the region with volume growth of 3.6% year-to-date and 3.5% in the third quarter. Within North America, growth was led by snacks through Kerry's range of savory taste profiles and Tastesense Salt reduction technology. Growth in the retail channel was supported by renovation activity across global, regional and retailer brands with growth in foodservice led by good innovation activity with quick service and fast casual restaurants. And in LatAm, we had strong growth in Brazil and Central America, led by snacks.

In Europe, volume growth was 0.7% in the third quarter, 0.4% year-to-date. This included a good performance in foodservice through seasonal and new launch activity with retail volumes reflecting soft market dynamics in Western Europe. Growth in the region was led by beverage through Kerry's integrated taste technologies and proactive health ingredients.

Turning to APMEA, where our volume growth was 4.1% in the third quarter. This was primarily driven by strong growth in Southeast Asia with solid growth in the Middle East and Africa and volumes in China remaining challenged. Foodservice delivered strong volume growth with coffee chains and quick service restaurants and retail channel volume growth was driven by Kerry's authentic savory taste profile. Growth in our end market was led by bakery through food protection and preservation systems as well as reformulation activity in areas, including cocoa.

Turning to the components of our reported year-to-date revenue bridge on Slide 7. Volume growth, as I mentioned, was 3%, with pricing up 0.2%. Transaction currency was favorable 0.2%. Translation currency was adverse 3.6% given the movements in the U.S. dollar and emerging market currencies versus the euro. And the acquisitions net of disposals was a net decrease of 0.8% in the period.

Finally, to cover off a number of other matters on Slide 8. Net debt at the end of the period was EUR 2.2 billion, reflecting cash generation, capital investments and the share buyback program. We initiated Accelerate 2.0 as planned during the period, and we are pleased with the progress made.

Firstly, in executing the footprint optimization strategy across Europe and North America, including the commencement of some site closures and the disposal of some associated business activities. And secondly, we have started the rollout of a number of digital initiatives we have been piloting over the last 18 months within our manufacturing operations and commercial activities.

On input costs, while there is overall variation within our input cost basket, we are currently looking at limited input cost inflation for the full year. On currency, our outlook remains unchanged for a 4% to 5% translation currency headwind in the full year. To summarize, we delivered a good overall financial performance in the period with volume growth combined with strong margin expansion.

And with that, I'll pass you back to Edmond.

Thanks, Marguerite. So moving to our full year outlook on Slide 9. Our strong end market volume outperformance in the period demonstrates the strength of our strategic positioning across our markets, channels and customer base. And looking to the remainder of the year, while recognizing a heightened level of market uncertainty, we remain well positioned for volume growth and strong margin expansion as we continue to support our customers as an innovation and renovation partner. As I noted earlier, we're maintaining our full year adjusted earnings per share guidance of 7% to 11% constant currency growth.

And with that, I'll now hand you back to the operator, and we look forward to taking your questions.

[Operator Instructions] Your first question comes from the line of Patrick Higgins with Goodbody.

A couple of questions, if that's okay. Firstly, just in terms of, I guess, guidance, obviously, you reiterated the 7% to 11% on EPS. But just in terms of volumes, I think at H1, you said around 3%. Is that kind of reiterated as well? And I guess following on from that, at the H1 point, you noted end markets were broadly expected to be broadly flat this year. How has that developed since then? Could you maybe talk through the moving parts by region?

And then my next question is just around the innovation pipeline. Obviously, you've been pretty consistent about the strength of that through this year. How has that developed since H1? Have you seen any delays or kind of smaller-than-expected launches just given the challenging kind of consumer backdrop? I'll leave it there.

Thanks, Patrick. Firstly, on the volume outlook for the remaining of the year, no change to what we said at the half year. So we're expecting volume growth to be circa 3% in the full year. In terms of, let's say, market kind of, let's say, conditions or kind of what we're seeing by region maybe. The reality is there is a lot of variability out there at the moment. North America, the consumer backdrop has remained challenging. And I think we can all see that from different kind of market data out there or traffic data on the foodservice channel being slightly back year-on-year.

In LatAm, the market in Brazil has improved versus last year, but we've seen the opposite in Mexico. And in the APMEA region, market demand in Southeast Asia has been healthy for us. I think it's fair to say Indonesia has been the standout performer for us. But when we look right across Southeast Asia, it's been quite strong, maybe the only exception being Vietnam. And I think what's really important for us is our ability to be able to pivot resources at pace and at scale.

Then in terms of innovation, I guess, look, we called out a year ago that penetration opportunity and the scale of that penetration opportunity is quite significant. And as we look at the progression of our project pipeline between then and now, we've seen the impact of that penetration opportunity really, I suppose, contributing to our pipeline and contributing to the increase in scale in our pipeline over the course of the last 12 months. There has been quite a bit of launch activity in Q3, that will continue into Q4. Some of the performance of that launch activity in the market has been mixed in places. But overall, I would say the level of innovation that we have seen come through both on the retail channel and the foodservice channel is quite strong overall.

The main driver being the penetration opportunity, but we've also seen customers, let's say, for instance in foodservice, be it the larger players or the smaller players step up the level of innovation with the larger players more focused on protecting market share and securing market share and bringing innovation to the menu to do that, whereas the smaller players have been, let's say, more into the zone of scaling their businesses and expanding their businesses through store openings.

And on the retail side, we've seen significant step-up in activity on private label, which drives, I guess, the local and regional customer segment within our customer segmentation overall.

Your next question comes from the line of Alex Sloane with Barclays.

Two questions from me, if that's okay. Clearly, it's too early to talk about '26 precisely. But relative to where we are today, would it be fair to assume that APMEA growth next year can be closer to the medium-term target if China improves? And perhaps you could give a bit more color on the trends and outlook that you're seeing in China, obviously, still challenged in quarter 3.

The second one, in quarter 3, you had sort of more balanced growth between foodservice, which obviously slowed a touch on the traffic, but improved growth in retail. Would you expect that sort of balance to remain the case for the remainder of the year and into '26? Or should we expect foodservice to resume its historical outperformance?

Maybe taking the second part of your question first. As you say, let's say, the performance across foodservice and retail has been, let's say, foodservice is slightly ahead of retail as we sit here at the moment. But as we look out, we would feel that foodservice will still continue to outperform retail like it has in the past. I guess the headlines that we're seeing maybe coming from the larger players or the traffic doesn't reflect the level of activity that's going on within the channel.

I would say, from an innovation perspective, whether it's LTO, seasonal offerings, whether it's new taste profiles being launched onto the menus, a lot of innovation around chicken and pork, let's say, the whole poultry category, beverage continuing to be quite strong. Yes, the message really on foodservice is the headlines probably doesn't just capture the level of activity that's going on right across the channel.

Then maybe on APMEA for a minute. Look, our expectations here going forward over the coming, let's say, quarters and over the medium term is that the APMEA region will continue -- our expectation is that the APMEA region will continue to be in that high single-digit volume growth zone. Obviously, we're not there at the moment but we do remain very positive on the region. We have developed our business significantly there in recent years, particularly in the Middle East and Africa. We continue to invest in that region with new capacity coming on in Jeddah. We brought new ground in the manufacturing facility in Turkey. We're opening a new state-of-the-art technology and innovation center in Dubai. And that's really our expected standout performer here going out into the future in the Middle East and Africa.

China has been more challenging in recent times. Absolutely no doubt about that. We have, let's say, slightly adjusted our strategy in China in that we have seen some of our customer base in China look more to regions outside of China to grow their business. So we have made a slight pivot there from a personnel perspective and from a strategic customer engagement perspective, bringing them proactive concepts whereby they can target regions outside of China to grow their business and specifically develop products for, let's say, Southeast Asia and the Middle East and Africa, albeit these products will be produced in China. So a slight pivot there. We're not sitting back waiting for the market to change in China. We're being very proactive really to try and drive our business forward there and to get as proactive as we possibly can with our customer base.

[Operator Instructions] Our next question comes from the line of Ed Hockin with JPMorgan.

I've got 2, please. My first one is on Europe. So you saw a bit of an improvement in volumes growth in Q3, whether you could outline what drove that uptick and how durable it is as we think about Q4 and next year? And also with the appointment of Marcelo as the Head of that region, what is it do you think needs to be changed or developed or fixed within the region to get it on a more sustainable growth footing, after a couple of years that have been close to flat?

And my second question, at the group level, as we think about 2026, and obviously, it's early days to be talking about. But in the absence of an end market improvement, supposing end markets remain flat, what kind of levers do you see or what kind of areas to draw our attention to that could drive growth improvement versus this year? Or is it your view that in a flat market then a circa 3% is the right level for 2026 volumes as well?

Yes. Maybe first on the Europe question. I would say, look, our expectations for Europe and bear in mind, when we talk about Europe, we're talking about the developed Europe situation. Basically, our expectation is to be in that 1% to 2% volume growth range. And we are -- and we will progress towards that range in the, let's say, upcoming quarters. It's going to be a slow burn in Europe, though, nonetheless. I mean the market is, let's say, fairly challenged. It is a market that we're expecting to have a more proactive approach in that market. We've always been proactive in Europe, but we're expecting Marcelo to bring that level of pro-activity that we would typically have in emerging markets into Europe and to build on the good work that's already been going on in Europe.

We're not calling out any change in strategy in Europe. It's a continuation of the strategy. We believe we have absolutely the right strategy for our customer base in Europe and to grow our business in Europe. It's about, let's say, doing a refresh in terms of our approach to the market, bringing that emerging market mindset of intense productivity to the customer base.

Then in terms of maybe the outlook, I would go back to the point, Ed of, let's say, the market is going to do what the market is going to do. I guess we're really focused on driving our business forward. When I look at the scale of our pipeline versus where it was a year ago, it is significantly ahead of where it was a year ago. And I would call out maybe 3 big areas. The penetration opportunity that I've talked about many times in the past, that reformulation from a nutrition perspective, from a cost perspective and even from a sustainability perspective, these are all factors that are driving our business forward. There are challenges around availability of raw materials, et cetera, et cetera. All these things are driving our business forward, driving penetration, contributing to the growth that we're getting in the business.

And the major, I suppose, reformulation opportunities, specifically in North America are in front of us. The entire discussion around, I would say, the [ maha ] or the potential front-to-pack labeling or let's see how things play out in North America. But that's still very much in front of us. States are doing their own things, but there hasn't been a federal intervention yet in North America in terms of exactly the direction of travel. If and when that happens, we feel that's a further underpin of growth and a further underpin of opportunity for us going forward into the future.

Foodservice, there's -- we've seen a significant step-up in the level of value offerings and value meals and just our customer base being hyper focused and they're doing that through the lens of new launches, be it LTOs or seasonal offerings, but they've also stepped up their value offerings. And we expect that to continue over the coming quarters, and we're extremely well positioned as it relates to that channel.

And the third area I'd call out is, let's say, that private label opportunity, whereby retailers are being quite aggressive in terms of trying to bring new products to the market that are not just national brand equivalents. They are trying to bring high-quality products to the market to grow categories. So I guess as we look out into the future, we feel that despite the challenging market, there are several factors there that we feel quite good about as we look out into the quarters in front of us.

Your next question comes from the line of Fulvio Cazzol with Berenberg.

My question is really on the EBITDA margin, which is up 90 basis points in the first 9 months, up 80 basis points for the third quarter. So my question around that is, well clearly, it's developing probably better than what you would have anticipated at the start of the year, whether you can confirm that? And if that's the case, could you maybe just highlight for us what's driving this? Is it that you're seeing incremental cost-saving opportunities that you're unlocking? Or are you just executing faster some of the efficiencies? In other words, the 19% to 20% target that you've got for 2028, are you likely to achieve that earlier? Or is there going to be a bigger potential upside on the EBITDA margins?

Maybe I'll take that question. So firstly, we are pleased with the strong margin expansion of 80 basis points in the quarter. In terms of the stronger performance in the quarter, it's mainly due to the phasing of benefits from Accelerate Operational Excellence and portfolio developments, so slightly ahead of our expectation. I would say, though, there is no change to the full year expectation for margin expansion of 70 basis points or greater. We are well on track to deliver that margin expansion in the current year.

And then in terms of the -- looking forward to the margin expansion over the next number of years, we are happy that we have outlined a clear margin target of 19% to 20% by 2028. We have a clear pathway in terms of delivery of that target, and we're pleased with the progress that we've made in terms of commencing the Accelerate 2.0 program, which will be a strong underpin of delivery of that margin expansion over the next couple of years as well as continued expansion from mix and operating leverage.

Our final question comes from the line of Cathal Kenny with Davy, Research.

Two questions from my side. Firstly, just going back to private label, Edmond. Just want to delve into that a little bit more. Which region are you seeing most activity on innovation? And which region are you best placed to execute on that opportunity?

And then the second one is just on enzymes. I see it comes up in the press release a couple of times. Just wondering in terms of the end market applications you're focused on in terms of bringing that technology to bear.

Maybe talking about enzymes first. I mean I think the 2 end-use markets that we are seeing, I would say, performance that is maybe even slightly ahead of expectations is on dairy and bakery. Firstly, on dairy, we have quite a strong offering into the dairy channel, let's say, historically, but lactose intolerance is a growing kind of need out there in the market, and we are extremely well positioned to be able to take advantage of that opportunity, and that opportunity is quite global.

The second area is in bakery, whereby enzymes and our enzyme capability is a key tool to the toolbox, in our toolbox in terms of freshness and food protection and preservation. And again, that is a demand from our customer base across both foodservice and retail channels. And that is about basically bringing freshness and food protection and preservation in a clean label way to the bakery end-use market.

And yes, we recently announced a new Biotechnology Centre in Leipzig, Germany, and we're expanding our footprint in Ireland as it relates to manufacturing enzymes, both on the fermentation side and on the packaging side.

Then on private label. Private label is not new to us here in Europe or, let's say, in Ireland and the U.K. We have, let's say, a strong track record in private label, let's say, emanating from this region. And we have, I suppose, with that level of experience we have and expertise that we have in private label, we've deployed those capabilities into North America. It is in North America that we have seen a step change in terms of engagement with retailers around targeting certain categories where actually they want to take a leadership position in certain categories where they feel there's been a lack of innovation in recent years and they feel that there's, let's say, plenty of scope from a pricing perspective to bring really high-quality clean label, more nutritious food and beverage products into categories that they want to lead, and we're very well positioned to be able to actually enable them.

From an overall, I suppose, business model perspective, it is quite similar in terms of approach as we take for foodservice. So we feel well positioned to be able to take advantage of this opportunity and expect that private label performance and private label, I suppose, market expansion will continue in North America. And yes, we feel good about that as we look forward into the coming quarters.

And that concludes the question-and-answer session. I would like to turn the call back over to Kerry for closing remarks.

Thank you, everyone, for joining us on the call today. If you do have any follow-ups, please do reach out, and we just want to wish you a good day.