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Ladies and gentlemen, thank you for standing by. I'm Vasilios, your Chorus Call operator. Welcome, and thank you for joining the Sarantis Group conference call and live webcast to present and discuss the Sarantis Group's Half Year 2026 Financial Results. With us today, we have Mr. Ioannis Bouras, Group CEO; and Mr. Christos Varsos, Group CFO.

[Operator Instructions] The conference is being recorded. [Operator Instructions] Please be reminded that this presentation contains a formal disclaimer with regards to forward-looking statements. The presentation and discussion are conducted subject to this disclaimer.

At this time, I would like to turn the conference over to Mr. Ioannis Bouras, Group CEO. Mr. Bouras, you may now proceed.

Hello, everyone. Thanks for joining our call for half year results 2026 today. The agenda is including some highlights from myself. Then we continue with Christos Varsos on the financial performance, and then we talk about the outlook before the Q&A session.

So a few highlights about the H1 2026. First of all, I would like to reconfirm that our group is keeping the focus on our strategy reconfirmed based on our categories, on our countries, on our region and, of course, the key strategic priorities, which we consistently execute as a group. The digital transformation is well on track. We have concluded a significant number of projects and go-live events in almost all countries. We have only Poland left for next year. That is what we're working right now.

On the CapEx investment, we are on track. We have completed -- concluded the majority of the massive program, both in digital transformation, but also in our production facilities, especially in Poland. I have a few details later. And, of course, we continue investing in our people, developing our organization fit for purpose and, of course, supporting our strategic agenda.

The truth is that in the H1 2026, we have some significant geopolitical challenges related to Middle East. And this has resulted in a significant cost pressure in raw materials and logistics linked with the oil prices and, of course, the overall disruption in supply chain in the Middle East. And as you remember, significant investments concluded by the end of 2025, and these investments help us to counterbalance a significant part of the cost pressure. And, of course, these -- all of these things are still ongoing.

We have challenges in a couple of countries. Ukraine, things are not going very, very well in the country. There are events that are even harder -- going harder in the last few months. In Romania, there is a country that, although it's one of the biggest country of the group, there are some market issues related to consumption and, of course, overall market performance.

The last one is the phasing of our U.S. exports affecting H1 results, although the performance in our -- in the markets and sellout of our Carroten brand in the U.S. is doing really, really well, and I have later some details on that. Key focus, commercial excellence. The HERO SKUs remains a strategic focus for our business, the winning brands, and we focus on the key brands of the business. Revenue growth management initiatives to compensate cost pressures, focusing on the right SKUs and the promotional optimization is key part of the market. The innovation, fewer and bigger initiatives, working with consumers in the region is still a key priority. And the international expansion remains one of the biggest growth pillars for our future.

Moving on the numbers, high-level numbers. Christos will continue with details later on. Of course, from a top line point of view, 1.3% growth. Gross profit similar, underlying EBITDA, plus 0.4%, strong profitability. There is, of course, a pressure in the margins. There is a pressure in the market performance, and this is also reflected in our results in H1.

If we move on our HERO brands, which is a major focus. The top 15 brands plus -- almost plus 1% is 62% of our branded business. There's a clear focus from our business to develop further our brand portfolio where the major investment innovation and activities taking place. Private Label business is stable, so 11.4% of the group sales and the overall group is EUR 308 million, as I said before.

Now if we move to our categories. In our Beauty & Skin, the category is minus 2%. This is reflecting 2 things. One is the export phasing, which is included in this category mainly because of Carroten brand and the Romania pressure as a market, which is one of the biggest markets in our skin care business.

Personal Care, 2.7% down. This is also reflecting 2 things, the promotional pressure from all the competition in the region. And there is a specific category that we are a significant player is a fragrance business that is affected mainly, although other categories are performing quite well, both in sales growth plus market share development.

Home Care Solutions, plus 3%. Here, all the investments, all the energy, our leadership position in the region, plus the focus on our key brands and resulting in a very positive momentum for our Home Care Solutions and especially in the garbage bags category, the growth is even higher. And this is also absorbing the Ukrainian market, which is mainly Home Care Solutions market for us. Great momentum here, great projects. And, of course, we expect things to continue in a positive way in the future.

The strategic partnerships part is a good growth rate, plus 4.9% for the 6 months. This is because of 2 things. One, our focus on fewer and better partnerships that is part of our strategy and the relevant innovation that we have in this -- from out of this partnership. So innovation and focus is resulting in a better performance for our business.

When it comes to international markets, here, there are a few highlights related to the first 6 months. So the majority of the business in -- for the suncare Carroten brand. And, of course, there's a skin care business in the Philippines, which is also doing very, very well for our business. If I leave the U.S. last, Australia is a market that is coming up in the second half of the year. We are listed in the big retailers there, and we are continuing with Carroten brand.

Middle East, we have a much bigger plans for the first half of the year that has been affected by the situation in Middle East. So it's putting the whole H1 for the region under pressure. However, Middle East for us is a long-term shot. So we expect things to improve as the situation progress in the region.

The good thing also you have a new country joining in the second half of the year. This is not in our numbers in the first half. This is Chile and South America, which is part of our expansion strategy of Carroten brand to Latin America as a next step for growth among other countries that we are working on.

In U.S., there is a lot of positive developments in the first half of the year. However, operational reasons and, of course, stock holding in the customers in the U.S. and our distributor resulting in this phasing issue for the first half of the year. On the U.S., Carroten now is #1 tanning brand in Amazon U.S. and Target, which is the one retailer that we are working with. And, of course, as we are speaking right now, we are preparing next year significant upside in our distribution footprint, especially in brick-and-mortar stores, in physical stores because online, we are still very -- we are very strong in Amazon, and we continue to be like this.

One thing is the extra distribution. The other thing is the expansion of the assortment, where we are in a very good shape right now, and we are preparing the 2027 season with a lot of positive feedback and reaction from the customers and the consumers in the U.S. So Carroten is progressing, and we're expecting a lot of good things coming out in the near future.

Coming now to geographies. So this is a split between the different countries that we are monitoring. Greece, a positive year, positive first half. Greek market in specific categories is doing very well, and we are winning over other companies. Selected international markets, minus 14% is what I explained about the U.S. Poland, very positive. Romania is having the impact as of the market performance. Czech, Slovakia and Hungary, this cluster of countries continue performing very well. West Balkans is also having a tough 6 months. However, we see signs of improvement from a market conditions point of view, because 2025 and first period of 2026 was quite difficult. Bulgaria is positive and, of course, Ukraine, reflecting the impact of the market situation.

The transformation agenda, as I said, digital transformation, all the new SAP implementation is in place. As we speak, we have implemented the majority number of the countries. There were 2 countries left, one for next year, which is Poland. We are very near to the final go-live date is going to be in January 2027, and Ukraine will follow later on. From a planning point of view, we have completed all the investments, improving our planning accuracy and, of course, all the digital tools enhancing our digital capabilities have been implemented in the business.

Manufacturing upgrade, we have concluded almost everything in our Stella Pack regranulation business. And we are now -- we are getting the benefits in 2026. But, of course, benefits will even further improve as we're moving on in the second half of the year and 2027 as well. Our Oinofyta plant in Greece, the expansion is also in progress. By the end of 2026, we expect to complete also the investments there related to our skin care and sun care expansion, both in the region and the international markets. And, of course, all this CapEx supporting also the sustainability agenda for the group.

From the ESG point of view, we are improving our ratings. We are in line with our commitments for reduction of Scope 1 and Scope 2 emissions 42% by 2030 by reducing 11.5% for this year. And, of course, we have improved the ratings on all the raters, improving the scores on our sustainability agenda.

So this is the intro from my side. I will pass over to Christos right now to give you more details about the financial performance.

Thank you, Giannis. Let me now provide some details behind the key numbers Giannis described. As you will see, we share underlying and reported numbers. The difference between the 2 relates to a one-off event, the sale of the old nonoperating factory of Polipak. The difference from the value, the brokerage fees and other expenses relevant to this was EUR 0.8 million. Thus, the underlying P&L is the ongoing one. The difference between underlying and reported is only this one, so this influences all lines from EBITDA down to EBITDA all the way to net profit.

We should note here that maintaining the nonoperating factory had annual expenses of almost EUR 0.5 million. But after the sale, we will save this going forward, starting from the relevant portion in half year 2. Our net sales grew by 1.3% compared to 2025, with focus on our core categories, especially on our branded business, which influence favorably the mix of sales. Majority of our geographies did well with decline though in Romania and Ukraine, which influenced the performance.

Also, we had the phasing element on our sales of U.S., which influenced the first half, but will be normalized in the second half. In terms of price increase, these were minor half year 1 and the actual pricing is expected to be effective in Q4. Our gross profit margin remained flat at 38.6%. We started seeing improvement in cost of goods sold as a result of our investments in our production capabilities and the regranulation in Poland. However, this has balanced the pressure in the supply chain from the ongoing Middle East conflict, leading eventually to the same gross profit margin.

Underlying EBITDA grew marginally to EUR 48.5 million, with pressure also in the cost of transportation despite, as mentioned, the mixed performance and the cost benefits from our investments. Underlying EBITDA margin was flattish at 15.7%. Underlying EBIT at EUR 36.7 million posted a 2% decline compared to prior year with a margin of 11.9%.

Financial expenses in 2026, although improved in terms of interest expense following the prepayment of loans, especially in the second half of prior year, were impacted by more than EUR 1 million negative, mainly due to the devaluation of the RON. Following this, our underlying earnings before tax declined to EUR 34.8 million from EUR 36.5 million in 2025 with EBT earnings before tax margin of 11.3%. Underlying net income of EUR 27.7 million, down by 5% versus EUR 29.2 million in 2025, leading to underlying earnings per share at EUR 0.44.

Moving now to our product category so you can understand more about the dynamics in the first 6 months of the year. Only Private Label is impacted by the sale of the factory and has difference between underlying and reported. Starting with Beauty, Skin and Sun Care. This category, as you know, is a key pillar important for our organic growth plans. In half year 1 2026, net sales declined by 2% to EUR 54 million, impacted by the phasing of our U.S. exports in half year 1, which will be normalized in half year 2 and by performance in Romania. However, despite the net sales pressure, category EBIT grew by 7.4% and EBIT margin grew by 280 bps above last year, almost 32%, affected by the mix within the category.

Personal Care. In terms of Personal Care, this was a category with the strongest promotional pressure from the competition and with decline in the subsegment of fragrances. We had a decline of 2% -- 2.7% of net sales compared to prior year, with EBIT being impacted further by 17% to reach EUR 7 million EBIT with EBIT margin of 14.2%.

Home Care Solutions. Home Care Solutions grew by 3% to EUR 95 million with EBIT growing ahead of net sales by EUR 3.6 million (sic) [ 3.6% ] to EUR 10.8 million, with EBIT margin being stable.

Private sale -- Label sales were flat at EUR 35.2 million compared to prior year with breakeven EBIT. We remind you that we use Private Label on a tactical basis to absorb cost from branded business and will, over time, increase branded business and decrease the Private Label portfolio.

Finally, strategic partnerships. We had an increase of our sales by 4.9%, mainly driven by mass distribution, which rose by 12%, while selected business declined by 9% in the period. The EBIT declined by more than 30% to EUR 1.9 million, driven mainly by selective distribution, especially in Romania. As mentioned, the total group will have a solid net sales performance reaching EUR 308.3 million, and we have underlying EBIT at EUR 36.7 million with EBIT margin of 11.9%.

Turning now to our geographies. The underlying reported classification only affects Poland. For Poland, we are also splitting between branded products and Private Label to allow for better understanding of the dynamics. Greece domestic market grew by 1.9% to EUR 81.6 million, with EBIT being flat at EBIT margin marginally below -- moving by 30 bps.

Selected international markets net sales came below prior year to EUR 15 million as a result of the phasing that we mentioned earlier in our U.S. export. This is expected to normalize in the second half. EBIT was also impacted by this declining to EUR 6 million. The EBIT margin remains at the 40% level, the highest in the group, declining just marginally by 89 bps. Selected international markets remain a key focus for our growth strategy, having the strongest margin. And as Giannis described earlier, we expect this to grow in distribution, especially next year.

In Poland, the total business had net sales of EUR 94.3 million, a 4.9% increase versus prior year, with EBIT growing by 20% driven by branded business. The branded portfolio grew by 2.3% to EUR 65.7 million, with the branded business EBIT grew by almost 12% and the Private Label EBIT improved as well in low margin growth.

In other territories, we had a mixed picture driven by specifics in each country. Romania continues the declining trend started on the second half of last year with EUR 44 million of net sales, a decline of almost 5% versus prior year. In terms of EBIT, Romania achieved EUR 5.7 million, representing a decline of 16.8% with EBIT margin at 13%, declining almost 200 bps. We expect this trend to continue in the second half of the year as well.

Czech, Slovakia and Hungary accelerated growth by adding 11.5% more net sales, reaching almost EUR 35 million with EBIT of EUR 4.5 million, which is a 22% increase to prior year. In terms of EBIT margin, this improved by 109 bps, reaching 12.9%.

West Balkan showed a decline in the net sales of 4.9% to EUR 18 million, mainly impacted by the Serbian market. In terms of EBIT delivery, West Balkan declined EBIT to EUR 1.2 million from EUR 1.6 million in 2025 and then the EBIT margin dropped to 6.8%. West Balkans are expected to improve in half year 2.

For Ukraine, this is another year of pressure in the results as identified already from our full year results discussion. The net sales dropped by almost 10% to EUR 9.5 million and EBIT continued in the negative territory, declining further to EUR 0.7 million loss. As the geopolitical conflict in the area continues and as we witnessed lately, it accelerates, we expect additional pressure from Ukraine in the second half of the year as well.

Moving now to our healthy and strong balance sheet. As we have also discussed in the past, we maintain a strong balance sheet, which can support our organic growth, the next steps of our transformation agenda and M&A activities. As of 30th of June, we had net debt of EUR 29.6 million compared to EUR 32.8 million net debt on 30th of June 2025. In 2025, we also received EUR 20.8 million from Estee Lauder which while in 2026, we did not have a similar amount received.

I remind you that due to seasonality, our worst net debt positions on 30th of June, whereas the best 31st December. Already today, as we speak, net debt is largely improved versus June, standing at EUR 19 million. But by year-end, we should again be at net cash position. We have for year 1, 2026, we have improved our working capital by 2 days, releasing extra cash to the business.

As we have discussed also in the full year results, in the last quarter of 2025, we have made early debt repayments of EUR 17 million, reducing our financing expenses this year. We have now informed one of our lenders for a EUR 7.5 million prepayment to be executed by end of this month, enhancing further our earnings per share. We also expect another loan prepayment in Q4. Finally, as of today, we have committed loan facilities of EUR 120 million as a war chest for future acquisitions.

Enhancing our shareholder value is key for us. Underlying earnings per share reached EUR 0.44 from EUR 0.46 last year, declined by 4.4%. During the first half, we paid dividend of EUR 25 million or EUR 0.39 per share, representing a 25% increase compared to EUR 20 million paid last year. This represented a 47.1% payout ratio versus 43.5% payout ratio last year.

I would like now to provide an update on our CapEx for this year. Our new CapEx expectation for 2026 is for EUR 22 million from EUR 20 million we communicated earlier this year, which will complete most of our big projects. EUR 18 million was deployed already.

Now coming to our outlook. The group continues to monitor the ongoing geopolitical volatility to mitigate as far as possible the resultant pressure on raw materials, energy and logistic costs. Pressure continues in terms of cost in Q3, while the price increases are expected to be largely in place from September late and mostly in Q4.

Complexity is further amplified by local pressures, mainly within the Romanian and Ukrainian markets. Our strong brands, disciplined execution, sharp focus on cost control and commitment to our strategic priorities provide confidence to continue safeguarding healthy profitability. As the current environment is pretty liquid, we will be able to provide updates on the outlook later in the year if needed.

[Operator Instructions] The first question comes from the line of Iakovos Kourtesis with Piraeus Securities.

My first question, as far as I understand, you said you are going to provide an update on the outlook later in the year. However, taking into account that we're almost close to the 9-month period and your initial guidance for the year calls for EUR 620 million in sales plus 3.4% and EBITDA of EUR 97 million. It seems that taking into account your performance until now and the relevant headlines in Ukraine and Romania, would you say how confident are you that you're going to achieve this guidance?

My second question has to do with the fact that you ensured the firepower of financing of EUR 120 million for future acquisitions. How close are you to close any acquisitions? And if you could identify for us potential geographies, what will be your strategy for acquisitions going forward? Which parts of the business are you targeting for acquisitions going forward?

Thank you, Iakovos. Thank you for the questions. Related to the guidance, I think that's why -- because we said the environment is very volatile and there's a lot of uncertainties around. Of course, we see things and we say that we can commit for a more accurate number later on the year. And I think what we said is there are a lot of pressure in the market. But at this moment in time, we cannot commit to a specific number.

Related now to the EUR 120 million facility, what we know Sarantis Group has been proven over the years that is always there in the market. The strategy has not changed. We still focus on our Eastern Europe territory because, as we said, we focus on categories and geographies that we are already present, which also give us the benefits of synergies, same channels and, of course, same categories that we have the knowledge. And we continue to do that. So there is no new geography in the horizon for us at this moment in time.

And also what we see since the beginning of the year, although in the previous years, there was a theoretical interest for potentially new targets that were more theoretical interest. Now we have seen more specific processes coming through, meaning that it's more -- we have more robust and more, how to say, specific processes around potential targets. However, as we speak right now, we cannot say any specific things related to any potential M&A.

Okay. Okay. And if I may, one last question relating to your 5-year plan. I suppose that going forward for 2027, 2028, your target remains intact -- your plan remains intact going forward. Is this correct?

Yes.

Yes, it is.

EUR 120 million by 2028, 31st December 2028. EBITDA of EUR 120 million.

The next question comes from the line of Natalia Svyriadi with Eurobank Equities.

I hope you can hear me. I was wondering if we could get an indication -- well, we can't get a number for the full year, but an indication of the current running rate. We saw in H1 sales up 1.3%. Was this mainly volume driven? And how has this been evolving Q3 to date or on what you're looking into current figures on the top line, so we could probably understand if the remaining sales -- we should be expecting the 3% rise or something like closer to 1.5%?

And on top of that, I would like to understand a bit to get some color on the operating expenses rise. The gross margin was stable in H1. So probably the pressure, okay, apart from the EUR 800,000 coming from -- obviously, from the disposal of the plant. The remaining operating expenses will have had this pressure. Where did this come from? And have you seen this continuing? Should we expect this to continue? I'm trying to understand a bit the dynamics of the margins and how much we will be able to catch up, up to the year-end, based on current numbers you have.

Based on the numbers for the second half of the year, we expect a higher growth rate from a top line point of view, because the 1.3% needs to accelerate. So this is minimum you can have in the second half of the year, but we are aiming for higher than that. And related to the operating expenses, first of all, on the margins point of view, as you saw from the mix of the category sales, we see that the partnerships, the strategic partnerships part of the business is growing faster than the rest, right? This is affecting significantly the mix of our portfolio and, of course, the overall margin of the business. Related to operating expenses, apart from the one that Christos mentioned, there is also some impacting...

That will have the impact on the transportation and transport expenses because of the fuel and everything else not related to the Middle East crisis. And that was really the part which was not coming from our, let's say, what we have under control. It was more of the external determined operating expenses.

And also it's a little bit more depreciation that is affecting the operating expenses related to the CapEx investments over the last few years that is coming into game -- into play.

In the difference to a bit of EBITDA and EBIT.

A bit. Yes.

Okay. Yes, that's what I was trying to understand is the transport expenses. So probably these will continue tough -- to be tough given that fuel oil is on the rise again. So yes, I was trying to understand.

Think about also in Q3, what we'll have in Q3 is that we'll have the pressure from cost, but the pricing will start -- will hit in Q4. So potentially, this will be a bit -- it has the weaker point.

Okay. Okay. Do you have -- I don't know if you have a number, how volumes are evolving, like in the top line?

We have said that the portfolio of Sarantis Group is so diverse that is volume-wise, you have to go category by category. I can tell you right now because the first 6 months, there is no price increase in the first 6 months from a sales point of view. So all the volume that we have is volume-driven growth.

Okay. Great. That is very clear. Can I have another question on the CapEx? Do you have an updated number or the EUR 20 million you have given us for 2026, you believe this will hold because you've already done, I think, EUR 18 million.

Yes, as just presented it's EUR 22 million. So we expect instead of EUR 20 million that we talked about in March, we expect EUR 22 million now. But EUR 18 million of this is already done. So it is the remaining part to be done.

[Operator Instructions] Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

Nothing special. Thank you very much for joining the call. If any questions or anything comes to your mind, you can contact our IR. And, of course, we'll come back to you. Thanks for joining today, and talk to you soon.

Thank you.

Thank you.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Ladies and gentlemen, thank you for standing by. I am Maria, your Chorus Call operator. Welcome, and thank you for joining the Sarantis Group conference call and live webcast to present and discuss the Sarantis Group's Full Year 2025 Financial Results. With us today, we have Mr. Ioannis Bouras, Group CEO; and Mr. Christos Varsos, Group CFO. [Operator Instructions] The conference is being recorded. Please be reminded that this presentation contains the formal disclaimer with regards to forward-looking statements. The presentation and discussion are conducted subject to this disclaimer.

At this time, I would like to turn the conference over to Mr. Ioannis Bouras, Group CEO. Mr. Bouras, you may now proceed.

Thank you, and good afternoon, good morning, everyone. Thank you for joining our call today about our annual results of 2025. As we're starting this presentation, we are having a couple of slides as a reminder of our scope of work, our strategy and, of course, our main priorities as a group. Nothing has really significantly changed over the last period around our scope of work, our advantages as a business and of course, our strategic priorities.

The only thing that I would like to highlight is that on our scope of work, the selected international markets on Beauty, the performance has been exceptional in 2025, and I have a special slide on that one to explain a little bit how we're doing in markets outside of our Central Eastern Europe territory. Other than that, the remaining topics remain the same.

So if we move to our main categories, just reminding you that Beauty, Skin and Sun Care category is a huge focus for our group for disproportionate growth. This is a category, of course, that the international business development is mainly focused on. Personal Care is a core profit generator for us with large brands in our territory. Home Care Solutions, a significant growth driver for Sarantis Group and a category that in 2025 has received from our group significant support in terms of CapEx investments, integration with Stella Pack in Poland continuation of integration and completion of significant number of projects related to our cost of goods and supply chain continuity for the future.

Strategic Partnerships is a big part of our business. We continue progressing nicely here, both top line and bottom line. And of course, just to remind you that on this part of our business, we are focusing on fewer and bigger and more strategic partnerships versus the past.

And so we had a very solid performance in 2025. From a revenue point of view, we say we're broadly in line with last year. Later on, you can see details per category, of course, and of course, the top brands and how we are moving on with the top brands, top categories point of view.

There was a pressure on gross margin related to significant pressure from promotional activities throughout our territory. However, we managed to grow our EBITDA by 9.1% to EUR 89 million and significantly improving our EBITDA margin, as you can see.

And respectively, our EBIT growth by 10% and again, another improvement in our margins as well. And that is a much better net profit growth by 15.3% and again, a higher growth of margin, confirming that as a group, as a team, we are working behind all elements of the business, even in a tougher situation, how we're controlling our costs and our activities as well as value creation.

Of course, the proposed dividend for our shareholders is EUR 25 million, which is plus 25% versus previous year, and it's 47.1% of net profit, which is higher versus last year it was 43.5%. I think this is a good evolution also for our shareholders.

Moving on to our categories. As you can see, as always, we are presenting our core categories related to our strategy. You see significant growth happening in on Beauty and Skin, and this is also supported from our international business development, 21.3% to EUR 73 million.

Personal Care has faced significant pressures, but related mainly to 2 reasons. One is the performance of specific countries. And the second one was competition intensity and the promotional intensity in our region.

Home Care Solutions, one of the same. We have some countries that suffered this year due to economic conditions of the country and specifics.

Private Label, as we explained before, Private Label is complementary and supporting our supply chain capabilities in Home Care Solutions. Part of our business is to rationalize contracts that are not producing profitability for our group. And as we said always, we try to grow our Branded Business [indiscernible] the Private Label in garbage bags because this is the business that we are doing Private Label here.

Strategic Partnerships, we have a good growth of 4.6%. This is happening for 2 reasons. One, we have some new partnerships in specific markets, but also focusing on fewer, more strategic partners, as we said, through the innovation agenda of our partners, we have some successful initiatives in our markets.

One thing I would like to point out on the right-hand side of the slide, you can see that our Branded Business as a group grew by 1.5%, while the Private Label minus 14%, resulting in a flat top line growth versus a year ago.

But as you already know, one of our key priorities and strategic intent is to support our HERO portfolio, HERO brands. So as you can see there, the top 15 HERO brands of our business growing by 3.4%. And this is for us important topic, confirming that our strategy, our investment priorities and our innovation is working and doing very well in our markets that we operate.

Now coming to international expansion. We have some very good momentum over here. As you can see, the results of our international business surpassed the EUR 30 million, EUR 30.8 million. And the majority of the growth is happening via our Carroten suncare brand that now is having good traction in multiple markets and mainly, of course, in U.S. where in U.S., just reminding you, we have a big launch last year in Target as a physical distribution, but 2 years ago in Amazon as well. So we have a good momentum.

Now as we speak in 2026, we're expanding our distribution in terms of products in the same channels. And overall, the 2025 was a fantastic year in terms of growth, launching of the brand, activation, engagement with consumers in the U.S., resulting very good growth for us as well.

At the same time, we had a new listing of Carroten in one of the biggest retailers in Australia, which has also had a positive impact to our sales. And the good thing is also from a market share point of view and output is a positive as well.

We have also made initial steps in the Middle East, in Saudi Arabia and United Arab Emirates. But at this moment in time, this business is much smaller than the rest. We believe though that although the current situation, the potential of the region is good for us and our brand.

The good thing for us is that Carroten brand is growing nicely everywhere we do activities, even in our current territory in Central Eastern Europe because Carroten is a leading brand in Greece and markets in Balkan countries. But we see also the brand is having a good momentum and good traction in every market that we start launching and activating. So this is very promising for the future as well. And of course, for 2025, have a significant impact in terms of results for the whole group.

Now regarding our geographies, as you can see here, we were discussing in the past that selected international market was part of the Greek business. Now we can see separately here the impact. So overall, the markets, we have a mixed picture. Greece I would say, quite positive in a market that things are quite competitive and Sarantis Group has a significant business here and with leadership position in many of the categories.

Selected international markets, I just mentioned before. Poland has impacted mainly from the Private Label. You will see later some details on that. Romania has faced significant pressure this year as a market. And so that was a result of a drop of top line. Czech, Slovakia and Hungary, very robust and solid performance, growing nicely 7.7%, which is very positive for us, which is a significant market for Sarantis Group.

West Balkans also felt some pressures mainly on Serbia, and this is related to some specific situations in the Serbian market that impacted consumer demand. Bulgaria has a positive growth and Ukraine has been -- is the fourth year in the world suffered from a consumer demand point of view. However, I would like to note out that here, if you go like-for-like performance is minus 4.8% because we have discontinued some business from -- that we have inherited from Stella Pack, focusing primarily on Private Label.

So this is from the performance of sales point of view. But at the same time, 2025 has been a very busy year for the whole group, a lot of work from teams in Sarantis Group in multiple parts of the business. The one part related to digital transformation. So just to let you know that we have implemented our new [ SAP ] system and digital transformation, almost 80% of the business right now. The only country remaining to be implemented is Poland and Ukraine, which is going to happen next year for Poland.

New integrated business planning is completed. And of course, we have a lot of new digital tools that are supporting our strategy, our agenda and, of course, efficiency and simplification of the business. Many of these benefits that we have invested in 2025 are expected to be available for our people and our organization 2026, and this is where we are working right now to getting the benefits of all these investments.

At the same time, we have completed a massive CapEx manufacturing upgrade in Stella Pack as we have completed by the end of 2025, all the regranulation upgrade. And now we are working on getting the benefits and the savings in this -- through these investments -- via these investments. And on top of that, create a bigger safety risk avoidance level for Sarantis Group related to plastic garbage bags and end-to-end supply chain that we are creating in Poland. And I have to say this is one of the best in Europe right now, a very good asset for our future growth and profitability for this category, which is very strategic and critical for us.

At the same time, we are 50% completed the expansion of Oinofyta plant capacity growth to support our growing Beauty and Skin Care business, especially -- and of course, the international expansion that I mentioned before. So this program has almost completed. A few things left for 2026. And I think this is a huge priority for our people is to get the benefits out of this investment. And this is also reflected in the guidance that we have for next year and the margins that they are improving as well.

So this is, I think -- I have another one. Yes. On the third, ESG performance, we have done a work around our ESG footprint. In 2025, we have -- this was the first year of implementing our plan of reduction of Scope 2 and Scope 1 CO2 emissions. We are quite on track. We have a commitment to drop by 42% by 2030. We are fully on track on that. And at the same time, we have improved significantly our ESG ratings, supported by this business plan execution. And of course, we have started engaging with ESG raters to achieve that. So I think a lot of progress happened on this field from Sarantis Group.

I'd like to hand over to Christos right now to give us a little bit more details on the financial performance. Christos?

Thank you, Ioannis. Let me now provide some details behind the key numbers that Ioannis described. Our net sales came flattish compared to 2024. As per our strategy, the focus was to disproportionately grow our Beauty, Skin and Sun category, which influenced favorably the mix of sales and supported strongly our profitability.

Our gross profit declined by 1.7% with a gross profit margin declined by 59 bps to 37.1% due to softness in specific markets, as Ioannis also described and intensified promotion pressure in some other of the categories.

EBITDA grew significantly by 9% to EUR 89 million, leveraging on the mix of categories of our core portfolio with strong growth, as mentioned in our Beauty, Skin and Sun Care category, supported by our export business, which has higher margin, rationalization of Private Label contracts, which have low or negative margin, especially in the Stella Pack in Poland, cost benefit from the initial phase of commercial integration of Stella Pack happened in 2024 and [indiscernible] in 2025 while controlling OpEx overall in our business. EBITDA margin grew by 124 bps coming to 14.8%.

EBIT at EUR 67 million, a 10% increase versus EUR 61 million last year and EBIT margin of EUR 11.2 million (sic) [ 11.2% ], an increase of 100 bps.

Financial expenses in 2025 improved more than 65% following the early repayment in the last quarter of 2024 of almost EUR 18 million of debt, combined with lower interest rates. We continued repaying early debt from September 2025 onwards, which also gave us a benefit. We will continue 2026 repaying earlier debt supporting further improvement in our EPS moving forward.

Following the improvement of financial expenses, our earnings before tax grew by almost 16% to the record of EUR 65.6 million from EUR 56.7 million in 2024 and earnings before tax margin grew by 149 bps to almost 11% from 9.5% last year.

Net income at EUR 53.1 million, up by 15.3% versus EUR 46 million in 2024 and earnings per share at EUR 0.83, a 17% increase to prior year of EUR 0.71.

Moving now to our product categories, so you can understand more about the dynamics of the 2025 year. Beauty, Skin and Sun Care. As we have already mentioned in our 5-years plan, achieving disproportional growth in the Beauty, Skin and Sun Care category is a key pillar where we build our organic growth strategy. In 2025, we grew by 21% to EUR 73.1 million, supported by our Sun Care sales that continue accelerating this year with the help also of our export business. Category EBIT almost doubled with 98% growth and EBIT margin grew by 931 bps to almost 24%, affected by the mix within the category.

Personal Care. In terms of Personal Care, which is a core profit generator for us, we had a decline of 3.8% of net sales compared to prior year as we faced intensified promotional activity from our competitors, which impacted our sales for the category. However, EBIT came at EUR 17.5 million, close to prior year with an EBIT margin of 15.6%, a marginal improvement compared to the prior year.

Home Care Solutions declined by 3.3% to EUR 205.5 million, affected by pressure in some of our markets like Ukraine and West Balkans, which are mostly represented in this category and Romania due to local market conditions. EBIT declined by 8% to EUR 22.1 million, largely affected by the softer sales mentioned and the integration expenses of Stella as we are optimizing our supply chain network while we continued investing heavily. The real cost support from the optimization of the new investments will be benefiting the group from early 2026, as Ioannis already mentioned.

Private Label sales were mainly impacted by continued rationalization of the Private Label product portfolio, especially in terms of Stella Pack contract. Sales dropped by almost 15% to EUR 51 million, with EBIT being minus EUR 1.5 million. We expect that the completion of our CapEx investments in the granulation line will support us not only to be more cost efficient, but also will improve our overall competitiveness, both for our Private Label and Branded portfolio for 2026 onwards.

As mentioned in the past, we use Private Label on a tactical basis to absorb costs from the Branded Business, and we will over time increase Branded Business and decrease the Private Label portfolio as was the case for this year. However, the largely -- the large portion of the rationalization of Stella Pack portfolio has been completed and only smaller things will remain for the future.

In Strategic Partnerships, finally, we had a healthy performance, increasing our sales by 4.6%, while improving our EBIT by 15.3% to EUR 11.4 million, improving also our margin more than 7%. As mentioned in the past, we use the category for market leverage, and we are focusing on fewer and better relationships, a strategy that already brings improved margin.

For the total group, we had a solid net sales performance of the EUR 600 million. And EBIT, I remind you, grew by 10% to EUR 67 million and EBIT margin grew by 100 bps.

Now turning to our geographies. As discussed in the past, we wanted to share with the investor community the different dynamics outlining our performance. Thus, from now on, we will show the selected international market separately from our Greece domestic market as a separate business unit. For Poland, we continue showing total Poland by splitting also between Branded Business and Private Label. Finally, from end of 2025, we moved the managerial responsibility of our Hungarian business unit under Czech and Slovakia. Thus, we will be reporting them together from now on with [indiscernible] also reflecting this.

Greece domestic business net sales showed growth, posting an increase of 1% with EBIT of EUR 18.7 million, a 12.3% increase prior year and 12.2% margin, an improvement of 123 bps affected by mix of categories and cost control.

In selected international markets, we grew by 60% to almost EUR 31 million and EBIT to EUR 11.2 million, which is more than double compared to prior year, growing by 122.5%. As you see, exports have higher EBIT of 36.3%, and that is why we strongly believe in this segment as an accelerator to our growth for our 5-years plan. In our 5-years plan, when we communicated, we said that we were expecting to reach the EUR 30 million bracket in 2028, but we have achieved this already in 2025 with our focused execution, as Ioannis already mentioned.

In Poland, the total business had net sales of almost EUR 176 million, a 4.7% decrease versus prior year, with EBIT also declining affected, however, mainly by the Private Label portfolio. The Branded portfolio already declined in terms of sales by 2.5% to EUR 125 million. The EBIT improved by 4.8%, coming to almost EUR 11 million with an improvement in margin as well. The major driver for the decline in Poland was the Private Label sales declining by 9% on the back of the rationalization already mentioned of contracts, especially in the Stella portfolio, with EBIT also posting a loss of EUR 1.5 million.

In other territories, we had a mixed picture driven by specifics in each country. Romania had a weak year with EUR 94 million of net sales, a decline of 5% versus prior year on citing also strong performance in prior year. In terms of EBIT, Romania achieved almost EUR 14 million, representing a decline of 9.5%, with flattish EBIT margin almost at 15%, below by 74 bps to prior year.

Czech, Slovakia and Hungary accelerated growth for 1 more year by adding almost 8% more net sales, reaching EUR 64 million with EBIT of EUR 7.5 million, an 11% decrease prior year. In terms of EBIT margin, this improved also reaching almost 12%.

West Balkans showed a decline in the net sales of 5% to EUR 38.5 million, mainly impacted by the Serbian market with unless in the first part of the year and market pressure in the second part of the year. However, in terms of EBIT delivery, West Balkans managed to come flat to EUR 3.9 million with marginal improvement in EBIT margin, supported from cost control.

Bulgaria continued on its growth trajectory, growing sales by 5% to EUR 23 million and improving EBIT by 5.6% to EUR 3.2 million with marginal improvement also in EBIT margin to 13.8%.

For Ukraine, it's another year of pressure in the results as already identified from our half year results discussion. However, Ukraine specifically was also impacted by the sale of Stella Ukraine completed at year-end last year. Stella Ukraine, I remind you, had EUR 2.9 million of sales in 2024 and EUR 200,000 EBIT. Without this impact, on a like-for-like basis, the impact will be smaller, but still in negative territory. As mentioned, we are working with resilience in Ukraine and expanding our portfolio outside the Home Care, which is still the leading category in our business in Ukraine.

Moving now to our healthy and very strong balance sheet. As we have discussed also in the past, we maintain a strong balance sheet, which can support our organic growth, the next steps of our transformation agenda and potential M&A activities. As of 31st December 2025, we had a robust financial position with net cash of EUR 23.5 million versus net debt of EUR 8.5 million on December 31, 2024. I remind you that due to seasonality, our lowest cash position is on 30th of June, whereas the best is on 31st of December. This evident on 31st December 2025 as the net cash position implies a positive swing of cash from 30th of June to the year-end of more than EUR 55 million despite CapEx investments and early repayments of debt.

In January 2025, we have also received a EUR 20.6 million installment from Estee Lauder from the sale of the JV with them with the final one installment expected to be January 2028 for a similar amount.

From September 2025, we have made early debt repayments of almost 16 million, reducing our financing expenses and enhancing further our EPS. We will continue this strategy in 2026 as well on the second part of the year.

In 2025, we have improved our operational working capital by 10 days, releasing further cash to the business and supporting strong free cash flow generation despite the highest ever investment in CapEx in a single year, which reached more than EUR 7 million.

In 2025, we achieved free cash flow of almost EUR 80 million, more than doubling the free cash flow generation of 2024 of EUR 33 million.

Enhancing our shareholders' value is key for us. EPS reached 0.83 from EUR 0.71 last year, an increase of 17%. Based on our strong profitability growth and cash flow generation, the Board will propose to the AGM a dividend for 2025 of EUR 25 million, a 25% increase versus 2024. This represents a 47% payout compared to a 43% payout ratio in the prior year and a 38.2% payout ratio in the year before.

I would like now to provide an CapEx update for this year and expectation for the next. 2025, we finished the year with EUR 37.3 million invested in CapEx, as mentioned also previously in our guidance, supporting our digital transformation, our granulation expansion in Stella and our Oinofyta plant expansion, setting the foundations for our future growth. Since our 5-years plan communicated, we have invested already in '24 and '25, the amount of EUR 65 million for enhancing our business operations, and we continue investing strongly in 2026 as well.

With regards to the distribution center in Oinofyta, although we are ready to commence the project, we are now evaluating other alternatives to cover our business growth we presented recently, thus have removed it from our investment plan for the time being.

Thus, our 2026 guidance is based on new investment plan. In total, we expect to invest EUR 20 million in 2026 in the last wave of our digital transformation in Stella Pack and concluding our Oinofyta plant expansions that started in 2025. Overall, in the 5-year period, we plan to invest EUR 95 million or 17% more compared to initial plan communicated in our Investor Day of EUR 81 million.

Finally, we would like to provide our 2026 outlook. Net sales, as you all know, were rebased in 2025, and we now expect growth moving forward. In 2026, we expect net sales to grow by 3.5% or 4% compared to 2025 or EUR 620 million. In 2026, we will get the benefits from the investments that have been completed already in regranulation digital transformation, both impacting favorably on our costs. We will also continue our expansion of the selected international markets in our markets with our core categories, supporting further the mix.

We expect therefore EUR 97 million EBITDA and improved EBITDA margin of 15.6% improved by 76 bps compared to 2025. This is growth of EBITDA for another 9% compared to this year. As already mentioned, CapEx expectation for 2026 is EUR 20 million. In terms of free cash flow, we expect it to reach EUR 63 million for 2026, driven by increased profitability and working capital improvement.

Overall, despite the challenging macroeconomic and geopolitical environment, we continue executing our 5-year plan, and we are focused on achieving in full our target of delivering EUR 120 million EBITDA on 2028, which I remind you will be double compared to 2023 that was the base year. Thank you.

[Operator Instructions] The first question comes from the line of Svyriadi Natalia with Eurobank Equities.

I have 2 questions, if I may. Firstly, could you elaborate a bit on the main drivers supporting your execution going forward, especially in terms of product mix, pricing and promotional intensity across Greece and your international markets?

And secondly, could you comment on potential cost risk given the current geopolitical environment, especially regarding raw materials, energy and logistics and how this might affect margins going forward?

Thanks for the question. The first one, it's a big question. So I'm not 100% sure I can answer on this call. For us, from a mix point of view, I think the fact that we are focusing on our Beauty and Skin sector, that is the highest margin, as you can see from my presentation, this remains. And of course, 2025 was a year regarding the rest of the categories that have been very active in terms of promotion, in terms of activation in the stores. And this will continue. We don't expect 2026 to be completely different.

At the same time, just to give you another one that maybe you don't know or it's not visible in the presentation that over the last 3 or 4 years, we have increased our brand building investments and media investments and support on the brands more than 50%, meaning that all the growth or all the support we see around the brands is happening across the board, whether it's a promotion, whether it's an activation in store, whether it's extra distribution, extra visibility, but also consumer investments to support the brand building and the equity of our products.

So we don't expect to be any significant difference. And in our work, it's a daily -- kind of daily work with the customers, with the consumers, and this is where we are going to continue this year.

Regarding the geopolitical situation right now because, of course, things are changing on a daily basis. Of course, when you have this situation, you expect to have an impact and whatever is related to oil prices, transportation and logistics costs. At this moment in time, we have a team internally assessing all the risks, including myself, including all the executive team. And day by day, we try to figure out and frame what will be our activity plan and our actions around the current geopolitical situation.

Today, as we speak, definitely, there are categories that have been affected by the increase of the oil prices. And from our point of view, there are 3 -- we are going to work on 3 exits. One is the cost of our business, which is always a focus for us. The second thing is our promotional mechanisms on how we're going to work in the market and how we are going to adjust compared to the past.

And the third one is a dual thing. One is what will be the prices in the market, whether we need to increase, of course, prices in the market. This is always something we have to keep in mind, depending on the raw material growth. And the second thing is on this is that all the investments we have done executed in Poland, especially on the part of -- a big part of our business, which is garbage bag, that is giving us a lot of ammunition and flexibility to control much better our costs compared to the external environment because the raw material of our new facilities in the garbage bag is consumer and industrial waste, which is not entirely affected by the current geopolitical risks and issues in the Middle East.

So these are -- we have elements in place. And of course, always adaptability and agility from the team is critical in order to respond to the current situation.

[Operator Instructions] The next question is from Zouzoulas Constantinos with Axia Ventures.

Congratulations for the results. A few questions from my side. If we focus on Greece, the 1% growth of the market, you mentioned there is some pressure, some competition there building up. But on the other hand, the EBIT margin is much stronger. What we should expect going forward, both in terms of growth of the Greek market, but also margin evolution? This is my first question.

Yes. Regarding Greece, just to remind you that Sarantis in Greece has the most diverse portfolio of all countries -- of our all countries. So it's the biggest business in terms of consumer base and of course, all the categories and diverse portfolio.

One thing that we do in Greece quite successfully, I would say, is that we're prioritizing the strategic portfolio, the HERO brands that I mentioned before. And this is resulting sometimes more moderate growth. But if you see within categories, the strategic categories are growing nicely, and we are growing share. And that is the reason we have a better margin and better results in terms of profitability. So this is what is happening.

Going forward, we are going to continue the same strategy. We're not going to change that because this is -- the primary objective is to grow the business in a healthy way and a more margin-enhancing way. So this is what we are going to do in Greece and all countries that we operate.

All right. You said all the countries that you are operating. But if we focus on Poland, now you are operating Stella Pack for 1 year. You took strategic decisions for Private Label and products and everything. What opportunities do you see in this market?

Poland is now from a top line point of view, the biggest market we have in the group. However, still far behind Greece in terms of profitability. Definitely, the investments we have done in Poland, the majority of the benefits of the investments we've done in Poland will be given -- improving the profitability in Poland, definitely.

However, what we see in the Polish market, although the macroeconomics of Poland are positive in terms of consumer demand and competitiveness in the market, things are much more difficult. So I think with the new investments, the new cost base of our business and our activation plans we have for 2026, we expect a better result, of course. And this is what we are aiming for. Also to remind you that Poland is more towards the Home Care Solutions category and less on Beauty and Personal Care. So this is affecting the overall margin of the country.

And the last question has to do with exports. My understanding is that the focus for exports will be the U.S. market for 2026 and onwards? Or you choose to do a similar push in Australia, as you mentioned in the other markets?

Currently, as we speak, the majority, of course, the exports in the U.S. is a big part of the business. And of course, it's the biggest market. Definitely, U.S. will be a huge priority for us. But Australia is also there -- we are also there, and we continue to be there and pushing and working on the expansion of the business. Middle East is starting, as I said, but of course, there are good prospects for the future. Philippines, we still -- with Skin Care, we are there in a very strong position, and we continue on that.

And now as we speak, what we see a good traction on Carroten brand. And as we speak, we are working on expansion of Carroten brand in other markets, whether it's in U.S., like Mexico or Latin America, or other Western European markets that they are very attractive from a Sun Care category point of view. So definitely, U.S. is a huge focus and priority, but also we're exploring other markets and other opportunities in the rest of the world. So for us, the ambition is Carroten to be a real big international brand.

[Operator Instructions] There are no further audio questions. We will now accommodate any written questions from the webcast participants. The first question is from Victor Le Boulenger with LFDE.

Could you please comment on your current cash position? Given your cash, are you prioritizing a new acquisition? Or are you potentially considering SBB in 2026?

Thank you very much, Victor, for your question. On with the current cash position, as you imagine, we continue focusing on working capital improvements towards next year as well. First of all, we are keeping -- based on our current cash flow, we increased the dividend payout this year.

Obviously, we continue monitoring the market, as we have said, for bolt-on acquisitions. So that's something that has been traditional in our strategy and continues being there.

And obviously, share buyback, we have an approved share buyback program for the last 2 years, and we will continue using it and we'll continue doing share buybacks as we have been doing in the past.

So in all respects, we continue -- it is a very -- as you have noticed as well, it is a very free cash flow generative business, and we will make sure that we make the best uses of our cash moving forward, supporting our shareholders as always.

The next written question comes from John Kalogeropoulos with Beta Securities.

Two questions, if I may. One, dividend policy will continue on the 2025 remuneration path, meaning payout in the tune of 45% to 50% or return to the 40% area?

And two, how likely and when do you see a change in your core 5-year business plan presented back in 2024?

John, thank you very much for your questions. Dividend policy, as we have set the policy per se that we have paid -- we said that we'll be paying us a minimum around 40%, 38%, 38.5% when we actually set the policy 3 years ago. So we continue being in this direction. Obviously, when -- as last year and this year, when the cash generation and the profitability allows us, we can give even more. So the minimum policy is 40%. But as you have seen, we keep rising, we roll this last year, and we continue rising. So based on the circumstances and the cash flow generation, we can always pay something more. But let's say, policy-wise, it's minimum 40%. We moved 43%, we moved 47% now. So I think you'll be able to see this year in, year out in the future.

Regarding the 5-year plan we presented 3 years ago, I think this is a crucial year in many senses as it is the third year out of the 5. So in order to update this, we need -- we think that we need to have something like a catalyst or a catalyst event or -- and this potentially after we finish this year, we will see whether we need to update it or we continue on the same topic. So I think it could be an option, either end of this year or early next year, but we could be updating. We will be -- at that point, will be 3 years in a 5-year plan. So it'll be good to provide an update given the circumstances at the time.

But as we speak right now, just add here, we are keeping the guidance for the EUR 120 million EBITDA end of 2020. So there might be some adjustments in terms of top line. But from the EBITDA point of view, we're keeping as it is. So practically, we're talking about higher margins as we move on based on slower net sales given that we rebased 2025.

The next written question comes from Dimitris Giannoulis with Researchgreece.

What sales growth do you assume for Poland, Romania and selected international markets in 2026?

Thank you, Dimitris, for your question. As you know, we do not provide individual guidance per country. So on this time, I cannot be able -- obviously, we have an overall sales increase next year of 3.4%. And this country, especially Romania that started at a lower base and Poland, we expect growth. But I wouldn't also will discuss, we don't provide guidance per country at this stage, only the total.

The next written question is from Emmanuel de Figueiredo with LBV Asset Management.

Could you please comment about the first 2 months of 2026? Have they been in line with the end of 2025?

Going back by month, it's quite difficult to comment right now. We have not -- we just closed the second month. But in any case, we are coming back with the first quarter in April. So we'll come back with more details in that perspective. What we are expecting right now is, of course, we put the guidance and this is what we are looking for. But of course, more details will come on the following months in April for the first quarter.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

I think we're -- thank you for all the questions and attending the call. Thank you for understanding and the nice questions. No further comments from our side. We continue our strategy. We continue our journey. A lot of excitement is coming through. A lot of challenges are coming through, as you can imagine. This is the nature of our business. And of course, as a team, we are all committed to support the business agenda and committing also the numbers that we have put out there throughout the last period. Thank you for attending the call and talk to you soon in the next call, right?

Thank you. Thank you very much.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Ladies and gentlemen, thank you for standing by. I'm Vassilios, your Chorus Call operator. Welcome, and thank you for joining the Sarantis Group conference call and live webcast to present and discuss the Sarantis Group's Half Year 2025 Financial Results.

With us today, we have Mr. Ioannis Bouras, Group CEO; and Mr. Christos Varsos, Group CFO. [Operator Instructions] The conference is being recorded. [Operator Instructions] Please be reminded that this presentation contains the formal disclaimer with regards to forward-looking statements. The presentation and discussion are conducted subject to this disclaimer. At this time, I would like to turn the conference over to Mr. Ioannis Bouras, Group CEO. Mr. Bouras, you may now proceed.

Hello, everyone. I would like to thank you for joining the call today. We're very happy to have you all here. We are ready to start. So first of all, I would try to highlight -- we give some highlights at the glance of the first 6 months of 2025. What we would like to confirm is that our strategy remains the same. We are consistent and very precise with our strategy designed over the last 3, 4 years and consistent execution is also critical for our performance.

This year, the first half of 2025 has been massive in terms of investment and energy behind the CapEx investments in our group, and we are on track on that, where all these CapEx are supporting the growth for the future. The Stella Pack integration is in the final stage as we are working right now on combining warehouses in Poland for the local operations plus all the networks in the markets.

And of course, a significant part of our CapEx investments directed to Stella Pack upgrade -- factory upgrade, supporting our regrnulation capabilities in Poland. On the digital transformation, we are well on track. It's also a significant amount of energy from the team to deliver our digital agenda. We are -- of course, we'll have some details later on that. 2025, we continue our investments in our people as the capability enhancement of our people and of course, the leadership development is critical for our future of our business.

And another highlight is the expansion of our footprint in the U.S. market via our Sun Care brand, Carroten, which is well advanced and has been also significant for the first half of the year. From a commercial excellence point of view, the priorities and strategy remains the same. The HERO SKU philosophy continues and even we are working towards that. We're applying a lot of rules of revenue growth management in the market, focusing on the mix of the portfolio, the investment strategy, promotional strategy and how we are delivering the growth via the categories that are improving our profitability as a business.

On the innovation side, many new things coming through. And of course -- but as always, we are focusing on fewer and bigger initiatives. And the international expansion, as I mentioned, is driving growth and strengthening, of course, our select international markets that is one of our key priorities in our strategy. So in terms of numbers, of course, from a top line point of view, plus 0.5%. It's -- we're keeping -- just to remind you that last year, first half was very, very strong. So we're keeping our power in the market.

On gross profit, we have also equivalent growth. But when it comes to EBITDA, EBIT and EBT and net profits are double-digit growth is coming through. And this is happening, of course, because of our operational efficiency, cost controlling and of course, all the work happened over the years to make the organization much more efficient, plus the mix of some of the categories are helping towards this direction.

Now when it comes to category, as you can see clearly here, as we always present, Beauty and Skin and Sun category has provided significant growth in the first half of the year, plus 22.7%. This is, of course, includes the international markets growth where U.S. also is critical to this journey.

Personal Care. Personal Care, there are some pressures in this category. Of course, intensive competition is coming to the game. There are things happening in the market that are affecting the top line growth, but still is one -- it's a very big category for us. Home Care Solutions, also similar. We have a pressure in the market where it's coming from demand from specific markets. And this is also something that we are working on.

Strategic partnerships, we have a 2.1% growth, and this is coming mainly because of the work that we are doing with our strategic partners on some of the innovations they are providing for us, plus some new smaller businesses that they are coming to our portfolio. Private label has been minus 16.7%. We have discussed this in the past that private label is a business that is supporting our supply chain agenda for Home Care solutions category. So key priority for us also is the profitability of this category. It's not -- as you will see later, it's not a massive profitable category for us.

So we have to balance between the growth and the profits at the same time. So although the category for us is dropping by 16% from a profit margin point of view is not significant. On the right-hand side, you can see that the branded business of Sarantis Group for the first 6 months is growing by 2.5%, while in private label, we are dropping by 16.7%. Now a bit of an update on international expansion. As we said, Skin and Beauty is a significant growth category for Sarantis Group as a whole.

And within that category, the international expansion of beauty and skin is a critical part in our agenda. We have set up this priority 2, 3 years ago. The projects that we are running in different parts of the world are doing very, very well with, of course, U.S. been exceptionally -- running exceptionally well for the first half of 2025. We are working with some of our portfolio from a planning point of view and becoming a very successful in the U.S. market in different retailers, either online retailers or offline retailers, where this year, of course -- and this is also increasing our appetite for further initiatives in the market for the years to come, right?

So this is something that is helping us a lot. And of course, we'll put a lot of energy and efforts behind. On top of U.S., though, we have on the other side of Earth is Australia, where the news are that we have listed in one of the leading retailers in Australia, one of the 2 biggest retailers in Australia. So it's going to hit the market in the coming summer for summer, meaning Australian summer, November, December this year. With Philippines, we continue with our Bioten very strongly.

Of course, the brand is launched many years ago. So we are now quite mature. But of course, the product is developing nicely there together with Clinea. And recently, we had some openings in the Middle East with Saudi in the #1 retailer in Health and Beauty and United Arabic Emirates with the second -- #2 retailer in Health and Beauty with our Carroten brand in Middle East. So plenty of initiatives here. And of course, as a team, we are working behind all this and some others that they are rising over the last period. When it comes to geographies, so here is the usual table about the different markets.

As you can see, Greece is growing nicely. It is not only the international markets that they are growing by 52%, but also Greece domestic market, which is the biggest, it would a growth of 3.5%, which is very, very positive. And Poland is -- overall, if you see, there is a minus 4.7%, but this is mainly due to the private label business, which is included in Poland country. While in the branded portfolio, we are growing 1.1%.

Romania, the first 6 months has been challenging for Romania market. There are several issues on the market. We believe that going forward, things will get better. There are some political things happening in the market affecting the overall demand from the consumer. When it comes to Czech and Slovakia, very, very good growth and continuing growing from the previous years. West Balkans also have been facing some challenges, especially in Serbia over the last months. Ukraine, yes, minus 12%. But just to remind you here, we have disposed some business from Stella business that we bought last year, mainly private label or tactical business that they had in Ukraine.

So if you compare like-for-like, this is minus 1.2%. So actually, Ukraine business for us is flat versus 2024. When it comes to Bulgaria, it's again, a smaller market, flat, and then Hungary is developing by plus 5.2%. So this is a picture from the geographies point of view. And now regarding all the things that I mentioned at the beginning of the highlights, 3 major pillars here.

One is the digital transformation. So if you remember, we said before that we are implementing new SAP for our business and plus other systems together with that. So where we want to build a unified data platform across our markets. So the go-live of SAP went first in Greece, Czech Slovakia and Hungary, very successfully in the Q1 of 2025. And now we are preparing the Wave 2 for January '26, which includes West Balkans, Romania and Bulgaria.

The whole project on this one will be concluded beginning of '27 with Poland and Ukraine. So we are well advanced now with our plans. Team is very confident, and I think the implementation is successful and without disruptions. Now the integrated business planning completed. This is already completed in June this year. So we have a new platform for planning and for the whole organization, critical to manage our complexity to include our commercial planning together with the supply planning. and, of course, be more accurate in our forecasting and our planning accuracy.

The new -- we have new digital tools coming together with the new systems that are helping to optimizing our operations and workflow and processes. So this is critical. On the manufacturing upgrade, as I said before, the Stella Pack regranulation update is well on track. And of course, the whole project will be completed by Q4 2025. And I think this is critical as the investment is around EUR 15 million, and this investment is critical for making sure that our supply chain of garbage bags is one of the most competitive supply chains in Europe.

And of course, having a fully recycling granulated materials for producing our garbage bags, which is a differentiator for us as well. Our [ Innovita ] plant because of the expansion of our Skin Care business and our export business of the sun care, we have another EUR 10 million investment program that is going to be completed by Q1 '26. But of course, the majority of that will be happening also this year, increasing our capacity for our Beauty and Skin and Sun Care sales. All of these CapEx investments are linking also our sustainability and ESG agenda, where energy efficiency is also critical for the business.

And of course, all the automations around our plants in Greece and Poland are critical also to improve our productivity. On the ESG agenda, we have commitments. We are following through properly our agenda on delivering the commitments that we promised. Now we are in the position to validate with SBTi our near-term climate targets.

Also, we are working on with the digital agenda to have a proper accurate and fast way of measuring our progress. So everybody will be accountable and dedicated to the delivery. We are working with the ratings right now, CDP and EcoVadis to get proper rating and also -- and this is also part of our agenda of ESG. So that's an introduction from my side with the basic numbers.

I will hand over to Christos right now, Varsos, our CFO, to give us more detail about the numbers and the financial results.

Thank you, Ioannis. Let me now provide some details behind the key numbers Ioannis described. Our net sales grew marginally compared to 2024 with focus on our core categories in Beauty Skin and Sun Care, which influenced favorably the mix of sales. I remind you that we are cycling a very strong half year 1 in 2024 when we had very hot summer across Europe, which was not the case this year for several of our countries.

Our gross profit grew marginally with a gross profit margin remaining at 38.6%. EBITDA grew significantly by almost 16% to EUR 48.3 million, leveraging on the mix of categories of our core portfolio with strong growth, as mentioned, our beauty skin sun care category, supported by our export business, cost benefit from initial phase of commercial integration of Stella that was completed last year, while controlling OpEx overall in our business. EBITDA margin grew by 200 bps coming to 15.9%, plus EBIT at EUR 37.5 million, an 18% increase versus EUR 31.8 million last year and EBIT margin of 12.3%, an increase of 181 bps.

Financial expenses in 2025 improved significantly following the early prepayment in the last quarter of 2024 of EUR 18 million of debt, combined with lower interest rates. We will continue prepaying early debt, supporting further improvement in our earnings per share. Following the improvement of financial expenses, our earnings before tax grew by 21% to EUR 36.5 million from EUR 30.1 million in 2024 and PBT margin grew by 200 bps to 12% from 9.9% last year. Net income, EUR 29.2 million, up by 20% versus EUR 24.3 million in 2024 and EPS at EUR 0.46, a 22% decrease to prior year of EUR 0.37.

Moving now to our product categories, so you can understand more about the dynamics in the first 6 months of the year. Beauty, Skin and Sun Care. As we have already mentioned in our 5 years plan, achieving disproportional growth in the Beauty skin and sun care category is a key pillar where we build our organic growth strategy.

In half year 1 2025, we grew by 22.7% to EUR 55 million, supported by our Sun Care sales that continued accelerating this year with the help also of our export business that Ioannis described. Category EBIT grew by 72% and EBIT margin by 800 bps to almost 29%, affected by the mix within the category. Personal Care. In terms of Personal Care, which is a core profit generator for us, we have a decline of 3.5% of net sales, as Ioannis described, compared to prior year, but EBIT grew by 13% to reach EUR 8.5 million EBIT with EBIT margin of 16.7%, an improvement of almost 250 bps compared to prior year.

Home Care Solutions. Home Care Solutions declined by 2.9% to EUR 101.7 million, affected by pressure in some of our markets like Ukraine and West Balkans, which are mostly represented in this category. EBIT declined by EUR 1.5 million to EUR 11.1 million, largely affected by the sales and the [indiscernible] expenses of Stella supply chain as we are optimizing our supply chain network while continuing investing heavily. However, the real support and the benefits from these investments and from the optimization will be benefiting mostly 2026 rather than the current year.

Private label sales were mainly impacted by continued rationalization of the private label product portfolio, especially in terms of Stella Pack products. We expect that the completion of our CapEx investments in the granulation lines will support us not only to be more cost efficient, but also will improve our overall competitiveness, both for our private label and branded portfolio. As mentioned in the past, we use private label on a tactical basis to absorb costs from branded business will over time increase branded business and decrease the private label portfolio.

Strategic partnerships. Finally, in our strategic partnerships, we had a healthy performance, increasing our sales by 2%, while improving our EBIT by 9% to EUR 2.8 million, improving slightly also the margin. As mentioned in the past, we use the category for market leverage, and we are focusing in fewer and better relationships. For the total group, we had a solid net sales performance, reaching EUR 304 million of net sales. EBIT grew, as mentioned, by 18% to EUR 13.5 million, and EBIT margin grew by 180 bps to 12.3%.

Now turning to our geographies. As discussed in the past, we wanted to share with the investor community the different dynamics outlining our performance. For Greece, we are splitting the sales between the domestic market and the exports to selected international markets. For Poland, we're splitting Poland between branded products and private label as this affects mainly the geography of Poland.

Greece grew in total to EUR 97 -- almost EUR 98 million, an increase of almost 10%. In terms of EBIT, this grew by 56% to EUR 19.3 million and EBIT margin grew by 600 bps to 19.8%. If we look at the subsegments, Greece domestic business net sales showed a healthy growth rate, posting an increase of 3.5% despite citing a very strong half year 1 2024 due to Sun Care sales with an EBIT of EUR 12.1 million, a 32% increase to prior year and 15.1% margin, an improvement of more than 300 bps affected by mix of categories and cost control.

In export markets, we grew by 53% to EUR 17.6 million and EBIT to EUR 7.2 million, which is more than double compared to prior year. As you see, exports have much higher EBIT of almost 41%, and that's why we strongly believe in this segment as an accelerator to our growth for our 5-year plan. In Poland, the total business had net sales of almost EUR 90 million, a 4.7% decrease versus prior year, with EBIT also declining affected by the private label portfolio. The branded portfolio grew by 1% to EUR 64.3 million, while EBIT decreased by 7.6%, coming to almost EUR 6 million, including also supply chain integration expenses, as already mentioned.

Private label declined by 6.7% on the back of rationalization of contracts in the product portfolio, especially for Stella, with EBIT being similar to prior year. In other territories, we had a mixed picture driven by specifics in each country. Romania, as already mentioned by Ioannis, had a slower start this year with EUR 46 million of net sales, a decline of 5% versus prior year, cycling a strong performance in prior year. In terms of EBIT, Romania achieved almost EUR 7 million, representing a decline of 7% with flattish EBIT margin at 15%.

Czech and Slovakia accelerated growth by adding 8% more net sales, reaching almost EUR 25 million with EBIT of EUR 3.4 million, a 23% increase to last year. In terms of EBIT margin, this improved by 160 bps, reaching 13.8% West Balkans showed a decline in the net sales of 4% to EUR 19 million, mainly impacted by the Serbian market with some arrest in the year and market pressure. However, in terms of EBIT delivery, West Balkans managed to grow EBIT by 5.6% to EUR 1.6 million and EBIT margin 8.6% with support from cost control.

For Ukraine, it is a year of pressure in the results as identified already from our full year results discussion. However, Ukraine specifically was also impacted by the sale of Stella Ukraine completed at year-end. Stella Ukraine for the record had EUR 1.4 million of sales in half year 2024, EUR 100,000 EBIT. Without this impact, the net sales would be almost flat and the EBIT would be growing by 4.5%. As mentioned, we are working with resilience in Ukraine and expanding our portfolio outside the Home Care category, which is the key category for Ukraine, which still -- and still it is a leading business in the area.

Moving now to our healthy and strong balance sheet. As we have discussed also in the past, we maintain a strong balance sheet, which can support our organic growth, the next steps on our transformation agenda and M&A activities. As of 30th of June, we had a net debt of EUR 32.8 million compared to EUR 43.9 million net debt as of 30th of June 2024. I remind you that due to the seasonality, our lowest net debt position -- our worst net debt position is on 30th of June, whereas the best is on 31st of December.

Already today, today, I'm talking about today, 10th of September as we speak, our net debt has improved more than EUR 20 million compared to the June numbers, standing today at around EUR 12 million. Thus, by year-end, we should be again close to net cash position. During half 1, we have received the EUR 20.8 million installment from Estee Lauder with the final one expected for January 2028. As discussed also in the full year results, in the last quarter of 2024, we have made early debt prepayments of EUR 18 million, reducing our financing expenses. We have now committed and formed one of our lenders for EUR 5 million early prepayment to be executed next week and further enhancing further our earnings per share.

In half 1 2025, we have generated free cash flow of EUR 13.4 million with our working capital improving compared to last year by 2.3 days. Enhancing our shareholder value is key for us. EPS reached EUR 0.46 from EUR 0.37 last year, an increase of more than 22%. During the first half, we paid dividend of EUR 20 million or EUR 0.31 per share, representing a 33.3% increase compared to the EUR 15 million paid last year. This represented a 43.5% payout ratio versus 38.2% payout ratio last year.

And as you remember, as per our dividend policy, we said that floor or the minimum we're going to pay will be 38% and more. I would like now to provide an update on our CapEx for this year. We are assuming less CapEx this year with respect to the distribution center next to our Nova factory due to later commencement of the project.

We are now in the competitive process to commission the construction company that will build it for us, so we expect to start within the next month. This will mean that only EUR 1.5 million from the EUR 7 million initially assumed will be spent this year and the remaining amount of EUR 5.5 million will be invested next year. The rest of CapEx remains the same as per our guidance back in March. Thus, our new CapEx expectation for 2025 is EUR 34.5 million from EUR 40 million we communicated earlier this year, while '26 -- 2026 will be EUR 35.5 million from EUR 30 million initially communicated. This will impact obviously favorably the free cash flow generation delivery by -- for full year 2025 by EUR 5.5 million.

Finally, we would like also to update you on our 2025 outlook. We reiterate our 2025 profitability guidance. I remind you that our estimations for 2025 are EBITDA of EUR 92 million, improved by 12.7% versus 2024. EBIT to EUR 70 million improved by almost 3% versus 2024. For net sales, we now expect a growth of 2% versus 2024, which will bring our net sales for 2025 to EUR 612 million. Thank you.

[Operator Instructions] The first question comes from the line of Svyrou Natalia with Eurobank Equities.

I was wondering if you could -- if you have any indication on how we are -- exports are running into Q3 as we entered because we are talking about products that are summer care products. Should we assume that these are continuing also in Q3 and running rates are holding in this period also?

And as I understand, with the expansion into Australia, we're trying to get the seasonality there. So maybe you could give us also an indication about the exports you are expecting in the other markets. And based on the experience you've already seen, what are you thinking? What numbers are you thinking there? That's one question.

I also have a question again regarding exports. If you could remind us -- this is just a reminder, these are higher-margin products, higher margin actually and the products we are talking about. Could you remind us a range there? How much this boosts our EBIT line? Okay. These are the questions I have for now.

Yes. Okay. On the export side, because, yes, Sun Care products is the majority of the growth coming for the export business. So the seasonality is critical. So until the first half of June of 2025, the majority of the sales are in -- so the second half of the year will not be the same, not the same momentum.

Definitely, though, Australian business like Australia will help. But what we know is that it's not going to be near to the ones have in U.S. in the first half of the year. So you cannot put the same second 6 months for the exports. It's a slower pace, of course. And this is also helping, of course, the first half of the year from this category point of view. So just to remind you that last year, total year exports were EUR 19 million for the full year. And this first half is EUR 17.5 million, if I'm not mistaken, right? You said...

EUR 16.5 million.

EUR 16.5 million. So our expectation -- and also just to remind you, in the 5-year plan, we said that by 2028, we'll get to EUR 30 million. So it looks that this one is coming much faster. So the expectation of the year will be something a bit below -- in the area of EUR 24 million, EUR 25 million, right, just to give you the perspective.

So practically, we'll bring this from 2028, most likely will be at this range in '26.

But of course, you cannot expect the same rate of sales for the second half of the year because the majority still is in Northern Hemisphere is not in the South, is only in Australia in the South. So it's not enough to do the same. Now regarding the margin, I think Christos presented that the EBIT margin for export is around...

41%.

41%. So this is the accelerator from a profitability point of view, is presented in the presentation, right? So it is a margin that it is really accretive to the margin due to the structure that we have discussed in the past. So this brings much more.

Okay. Great. Yes, I remember the margin around 30%. That's why I wanted to get this clear. Okay. Well, that's a good business coming in. Also, I wanted to ask something -- a follow-up. I just thought about that. Poland has been running, if I recall correctly, 1%, 1.5% on sales, the local market. But should we expect this to continue at this rate? Or should we see there -- not the private label products, the rest of the -- should we expect an acceleration there? It's one of your big markets. So I'm wondering how this should evolve?

We're expecting to be higher. We don't have exactly the number to share with you right now. But of course, if you remember also because this is a general comment, this is not taking the opportunity because in the 5-year plan, we talk about 4.5% to 5% -- 4% to 5% growth, organic growth every year. So this year, what we said right now, we are guiding for 2% at the end of the year, including private label, including all the roles of the different categories.

We are not changing the thinking and the mindset for the organic growth for the coming years. We believe that 2025 has been a little bit challenging in the sequence of some markets. And -- but we are not changing our strategy or say we are keeping our 5-year mindset and thinking behind the growth and organic growth. So we believe that -- and all the action plans we are taking in every country, in every category is to deliver these numbers. right?

So what we are expecting coming to your question specifically is not only in Poland, but also in other markets that today showing a drop for the first half of the year to go back to growth and go closer to the numbers that we have in our 5-year plan.

[Operator Instructions].

We can look at the questions that we have already received also in writing, so we can start answering that. And as if people want in the meantime, they can also continue asking questions.

Okay. Great. There are no further audio questions. We will now accommodate any written questions from the webcast participants. The first written question comes from Iakovos Kourtesis with Piraeus Securities. And I quote, "What is your CapEx estimate for full year 2025?"

We have actually, we included in the presentation. So as I said, we'll just -- we had EUR 40 million, now we have almost EUR 35 million, EUR 34.5 million. And we're only switching EUR 5 million to next year because of the later start of the distribution center in [ Nofta. ] So for this year, instead of EUR 40 million will be EUR 35 million, EUR 34.5 million. Next year instead of EUR 30 million will be...

The next written question comes from [ Giorgio Andreopoulos ] with Piraeus Asset Management. They quote, "Given the slowdown in sales within the Personal Care segment, do you anticipate this trend continuing into the second half of the year and into 2026? Additionally, what strategies are you implementing to remain competitive in that market? Finally, should we expect any changes to the sales guidance provided in the Q1 report for this year or subsequent years, 2026, 2027 and 2028 sales growth of 5.5%. And what should we expect in terms of EBITDA margin in the medium term?"

Now starting from the end, I think I said something before, but now I can reinforce, as we speak right now, we are keeping the 5-year plan and the guidance of the top line and the EBIT margins the same. Of course, this year is 1 year as we are moving on following the closure of the year in March and of course, the guidance for 2026, things can be a little bit -- but this is what we keep right now, haven't worked another plan. So that's the plan that we have.

Of course, as you remember, it was doubling the EBITDA when we presented. So it's a strong and challenging plan. But this is what we keep and the mindset of the growth as a company, organic growth is still here with our strategy that we are implementing. Regarding the Personal Care specifically, I think I also -- Christos mentioned about the top line in the first half, but also the profitability growth. these categories are quite competitive, and we have strong plans behind to bring back to growth and of course, to even further grow in our coming years. So this is a continuous battle in the stores. And of course, with everybody participating in this category.

So competitors in this category coming from new product, innovation, coming from promotional strategies, from advertising strategies, all this mix that is critical for all FMCG companies. So we are working on all these plans behind with our big brands and our hero brands in different markets or the whole region.

The next question comes from Iakovos Kourtesis with Piraeus Securities. And I quote, "Do you expect the recent VAT rate increases in Romania as of 1st August 2025 to further affect demand in the country? Do you have a specific strategy to cope with this?"

Definitely, any measurements that are affecting the consumer income, they are not positive for the market, right? But this is something is not only in Romania, but other markets have other measures. So the #1 priority for us is to be competitive and of course, adaptable to the new reality, and this is what we do.

Competitiveness, meaning that you have to be aware about the consumer disposable income. And of course, what is your promotional strategy and how you're promoting your brands and taking every little opportunity from the market. This is the way we work. This is the way we worked before, and this is the way we keep working right now. So there is no magic recipe. There is one thing. We have to do multiple things right in order to compete. But definitely, things like that are affecting the consumer demand. This is for sure a reality.

The next written question comes again from Iakovos Kourtesis with Piraeus Securities, and I quote, "Could you provide us with an update on the third quarter 2025 trading for specific international markets, Poland, Romania and Serbia. Do you see improved trends in these markets?"

In the third quarter, of course, not ending. So September is a significant month for all these markets because it's true that July and August are months that are not heavy in terms of sales and, of course, of activities. So we have to wait to see the closure of September. But again, the things are not like they are on flying. There are, of course, continue there have been challenges in these markets, right? But of course, we still need to wait the closure of September.

We're going to announce the third quarter end quarter in 24th of October or something like that. So we will have a full view on the September. And by then, we'll have also a portion of October.

The next question comes from Emmanuel de Figueiredo with LBV Asset Management. And I quote, "Could you give more color on the seasonality of the business as skin and beauty grow more, does this mean the company become more have to weighted?"

Thank you for the question. So if you remember the season in terms of seasonality, Q2 is a very strong period every year because of the sale of sun care. I remind you that we sell the sun, we start selling the sun. We produce it late in the year. Then first quarter, we actually send it to the stores and especially in the second quarter, then the stores sell it on the third quarter. So practically in every year, the first 6 months is the growth due to the sun care, which is seasonal, is much stronger.

Obviously, we have seasonality at the year-end with gifting and with our selected business as well. But in terms of half 1, it is always the stronger pace in terms of growth of our revenue. In this respect, the duty scheme is growing, obviously, not only the Sun Care. So the Sun Care is what we're talking about. But as Ioannis already mentioned, we have the exports will be a slower growth on the second part of the year. So to your question, we're not becoming much more heavy half 2 weighted. We are still largely half 1 weighting. But again, this supports also the difference in the profitability.

The next question is again from Emmanuel de Figueiredo with LBV Asset Management and I quote, "For 2025, should we expect a stronger second half than first half?"

I think you have seen the first half and you have seen the guidance for profitability for the full year and for revenue. So in this terms, it is -- it's almost 50-50 in terms of net sales, if you think about it, EUR 304 million versus EUR 612 million. In terms of profitability, we maintain at the same pace. So I don't think that we're talking about stronger or less strong half 1. We mentioned about the exports and everything that continue growing, which improves also the EBIT margin.

The next question comes from Georgia [indiscernible] Securities. And I quote, "Can you please elaborate on the reduction in your OpEx? Can you please discuss the impact of the changing product mix on your EBIT margin? Can you discuss your strategy on private label?"

I think on the OpEx side, elaborate. I mean, all the investments that we started a few years ago, and of course, we are accelerating in 2025 with more digital investments and everything, including our way we do business. This is helping, of course, the cost of doing business, and that's one of the major objectives. And this is what we are doing. It's not a magic recipe, plus making an efficient organization.

Of course, we can grow without increasing our costs. This is also critical from this side. This is meaning also we are challenging the way we do things. with new systems in place, we can challenge the way we did things in the past that were not that efficient. So efficiency in our business, meaning lower cost, right, definitely.

It is a sequence of events as well. Don't forget that last year, we started integrating Stella, and we started getting the commercial integration, which has finished last year. So we're reaping the benefits now. Now we're doing the supply chain optimization, and we're actually controlling this, which you'll see much benefits coming in 2026. So the OpEx is not a drastic type of thing. It is -- we built on it, and we built the culture as well to be able to have this saving moving forward. Now...

Product mix.

Product mix. As you remember and we have discussed even in the 5-year plan, in our plan for organic growth over 5 years in order to double our EBITDA to EUR 120 million, we said that we want to disproportionately grow Beauty, Skin and Sun Care because this has the highest margin. And I think this 6 months is pretty obvious of this because we are improving largely in a product category that we're gaining large EBIT margins, whereas at the same time, we're rationalizing a category like the private label, which in terms, it didn't have a strong EBIT.

So practically, we removed, if you think about it, we removed the balance that you see removed in private label really affected the bottom line. So this, you can see it going forward, and we believe that the acceleration also of the Beauty, Skin and Sun Care categories and the export, obviously, as discussed, will support very much the mix towards the direction that we've already communicated in the 5-year plan.

On the private label because I think we said during the call, we said before private label in [indiscernible] is complementary to our supply chain as an activity. It is a big size. It's important for us for 2 things. One is fulfilling capacities and of course, keeping our competitiveness. On the other side, we are not going to build more capacity to serve private label. This is that we made it clear. And our objective is to build and grow our branded business over the years and gradually removing capacity from private label.

The next question comes from Dimitris Giannoulis with Researchgreece and I quote, "What level of EBIT do you expect for the private label segment post rationalization? Which countries contributed in international sales in first half besides the U.S.?"

In the EBIT of the private label, we don't expect to be -- it's going to be a single-digit EBIT, right? So this is positive. So this is going to happen. It's not going to change significantly our profitability because of the rationalization. Regarding the countries contributed national sales, we have countries like Middle East, Philippines, we have Australia and of course, we have some Middle East, as I said. And we have countries, the U.S. is a big part of the H1.

The next question comes from John Kalogeropoulos with Beta Securities, and I quote, "What about further expansion abroad, examining any further opportunities?"

Yes. I mean what we say internally, I mean, this is one of our growth pillars for the future, in line with our skin and beauty strategy that we have as a strategic pillar. And of course, some of the initiatives that we are doing in the markets are giving us the signal that our brands, whether it's skin care brands, Bioten, Clinea or our Sun Care brand, Carroten, they are well accepted by consumers in different markets because of the quality, because of the claims that we have, the seriousness behind the production and of course, the competitiveness in general.

So as we speak right now, of course, we are scoping other markets around the world. Just to remind you, international business, meaning markets outside our territory, right? So whether markets can be in Western Europe can be an activation place for us, for our brands. And of course, accelerating markets like Australia and U.S. because U.S. we just started a year ago, less than a year ago.

So we are having plans to expanding our distribution in the U.S. or bringing more products into the market, and we are well advanced with these plans for 2026. More news on that, we will have on -- either on October this year in the 9-month results or in the results of the year-end in March 2026.

The next question comes from Bruno [indiscernible], and I quote, "The Romanian economy is currently slowing fast. What level of sales are you expecting for the full sales are you now estimating?"

What we're estimating for the full year is to have a flat year for Romania or minus 1%. This is the number that we are looking at right now.

The next question comes from Emmanuel de Figueiredo with LBV Asset Management and I quote, "How likely are you to perform any M&A? Do you have any open due diligence ongoing for bolt-on acquisitions?"

Starting from the end, we have no any due diligence at this moment in time. From the M&A point of view, as you already know, Sarantis is always open and active on this field. As long as there are any targets that are in line with our strategy, where the strategy is in our categories that we operate in our markets that we operate here in the Eastern Europe and in our channels.

So at this moment in time, we have no active due diligence process. But of course, there are opportunities out there, which may arise anytime soon or not. I don't know right now. I can't give you any information on that.

The next question comes from [indiscernible] and I quote, "Anything in the M&A pipeline considering the potential return to net cash by year-end?"

Starting from a net cash position, as you know, we are a cash flow generative business. Obviously, we have also committed debt and we have committed lines if we want to buy something. So in this sense, we have the framework, and we're actually in the market, as Ioannis described to have -- and we have things that we would like to buy. Obviously, they need to be -- wanted to be sold as well at a reasonable price. So in our strategy, we maintain and want to do bolt-on acquisitions. Obviously, it's a matter of timing. But we have all the capability internal and the funding to actually do larger things as well.

The next question comes from John Kalogeropoulos with Beta Securities and I quote, "You mentioned lower CapEx and potential shareholders reward uptick. To what extent?"

I mentioned lower CapEx, and I mentioned that we have higher free cash flow by EUR 5 million. What I mentioned as well was that we have a policy, a dividend policy that we're paying at least 38% of our net income as dividend. This year, when we saw also the profitability this year, we actually gave 43%, and that was the EUR 20 million. So it is not that it will be anything outside of our policy, and we'll continue making sure that we provide a good return to our shareholders and the good value for our shareholders.

The next question comes from Bruno [indiscernible] and I quote, "Please explain what caused the large drop of sales in the private label segment. What is the outlook for sales in the private label market in second half?"

I'll take the first part. I think we mentioned also while presenting that it has to do with rationalization of our contracts, especially of contracts, and we wanted to make sure that they actually are much more profitable. That's why you saw that despite the difference in the net sales line, practically nothing changed.

So actually, we're doing -- we're removing the correct contracts out of the case. So...

And also just to add here that some of the big customers that we have in private label, they have a bit of slowdown in sales as well. So we are not -- we are depending on also their activities in the private label.

So this is also affecting. From the H2 on the private label, we don't expect any significant change versus H1. Maybe we expect things to improve. So we'll bring the level of sales minus 10% versus 2024. This is what we see right now. But of course, these things are changing right now. And of course, new discussions are happening in every -- with different types of customers for the year to go.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

I would like to thank you for participating in the call. I hope we explained and present our case properly. Thank you very much for the participation and the questions and talk to you soon in our future interactions, right?

Looking forward for our next announcement in late quarter and obviously, to the continuous discussions with you, understanding more of our case and the execution of our 5-year plan. Thank you.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good evening.