Sodexo Stock

Good morning. Thank you for standing by, and welcome to Sodexo's Fiscal 2026 Results Conference Call. [Operator Instructions] I advise you that this conference is being recorded today on Friday, October 23, 2026.

At this time, I would like to hand the conference over to the Sodexo team. Please go ahead.

Good morning, everyone, and thank you for joining us for our fiscal 2026 earnings call. I'm Juliette Klein, Head of Investor Relations. With me today are Thierry Delaporte, our CEO; and Sebastien De Tramasure, our CFO, who will take you through the presentation. After that, we will open the line for questions. As usual, we will ask you to limit yourself to two questions and one follow up. If you have any additional questions after the call, please don't hesitate to reach out to the IR team.

With now, I'll hand over to Thierry.

Thank you, Juliette, and good morning, everyone. Thank you for joining us. Before we go through the numbers, so I'd like to step back for a moment on the year we have just completed. Fiscal 2026 was a year of diagnosis and reset. What have we done? Over the past year, I've spent significant time with our teams and clients across our businesses. This has given me a clear view of the issues we need to address, but also of Sodexo's considerable strength, the quality and the commitment of our people, the depth of our client relationships and our expertise and our global reach.

These are absolutely powerful assets, but our performance has not consistently reflected them. And that's the point. So over the year, we worked as a leadership team to turn the diagnosis into Shift & Grow, a clear action plan, which is now being deployed across the group. In July, at our investor update, we presented that plan to you, its first phase covering fiscal '26 and '27 is about rebuilding our foundations and restoring our competitiveness.

Concretely, that means 3 things: one, restoring commercial momentum and improving execution discipline; second, simplifying our organization and reducing complexity; and third, investing in critical capabilities in our people and our systems. Three months on, the work is underway across the group. And I will come back shortly to some of the first concrete changes we have made. The transformation will take time, there is no doubt, but our teams are moving with urgency and we are where we expected to be at this stage. That's what I would say today.

Our fiscal '26 results support this. We finished the year well with organic growth ahead of expectations. And today, we confirm our outlook for fiscal '27. Our priorities are very clear, and we are focused on delivering what we committed to.

Now let me turn to fiscal '26 in detail. As you can see, revenue was EUR 24 billion with organic growth of plus 2%. This was above our latest guidance, reflecting a stronger-than-expected fourth quarter. The underlying operating margin was 3.4%, here at the upper end of our expected range. We also made progress on our commercial indicators, developments reached 7.7% of revenue and client retention was 94.4%.

What I would say is the direction is encouraging, although retention remains below where we want to be, and we need to sustain the improvement over time. We maintain financial discipline through the reset. Free cash flow was EUR 379 million. Leverage ended the year at 2.4x, better than the level of around 2.6x anticipated in July at the time of the investor update. Sebastien will come back to these elements in more detail.

The proposed dividend of EUR 1.74 per share is in line with our capital allocation policy. Our focus now is to improve, as I said, retention, execute our new contract mobilization well and continue to raising executive -- execution standards across the group.

Moving to Shift & Grow, right, Shift & Grow 2030. It's been 3 months since our investor update. As I said, we're moving forward as planned. And Shift & Grow 2030 is now being translated into concrete actions across the group. We know what we need to do, get closer to our clients, be more competitive, faster in our decisions and more consistent in our execution. None of this is conceptually complicated. We know that, but it's demanding, and it requires disciplined execution every day contract by contract and site by site.

Now let me give you one example under each priority. On growth. The new account management model that we talked about back in July is in place for our top 200 clients. Each account now has one named owner accountable for retention, for growth and financial performance. In North America, in the U.S., Education segment, I have absolutely seen that change firsthand. The new leadership team has restored a level of focus and an intensity around retention that frankly, we had lost over time. They're getting closer to every critical account, mobilizing the right people, well ahead of renewal decisions. They've done systematic fresh eyes review on all critical accounts at an accelerated pace.

It's still early, I know that, but we are beginning to see better outcomes on renewals. On simplification now, restructuring actions are underway in every region. In the U.S., each segment has removed between 1 and 3 organizational layers, bringing segment CEOs closer to frontline operations and shortening decision paths. The work continues. This is not, as you can imagine, a onetime initiative. Simplification remains a core discipline and will continue to remove complexity wherever it slows execution or creates distance from our operations.

Finally, on performance culture, we have acted on the leadership review. Starting in North America. We have renewed around 2/3 of the leadership team and the level immediately below combining internal promotions on one side with selected external hires. We have also extended the review across all levels from operational leaders to the senior leadership team in each segment, giving us a much clearer view of where we have strong talent and where capabilities need to be strengthened.

I have been clear with our leaders, performance must be differentiated and decisions on roles, progression and reward must reflect results. Technology supports all 3 priorities. In fiscal '26, our focus was on making the right choices before scaling investments. We introduced much stricter go/no-go discipline and concentrated resources on the core systems and data capabilities that matter most to our competitiveness. Deployment will accelerate from fiscal '27, in line with the road map presented in July. What matters now, of course, is to keep the pace and make these changes stick across every business. This is a real transformation of the company, and it requires a lot of work.

Now fiscal '27 remains the second year of the recruiting phase. We'll continue to strengthen capabilities, simplify the organization and raise execution standards. The benefits should build progressively with a more visible acceleration from fiscal '28. The actions I just described are the core of Shift & Grow. We are contemplating them with targeted portfolio moves, each with a clear strategic rationale. For Entegra, the objective is to build greater procurement scale and expertise.

This is an important engine of competitiveness and profitability for our own operations as well as a growth platform with third-party clients. Cadhi and Prestige purchasing strengthened that platform in Europe. In Food services, Europe is a region where Sodexo has deep roots but where our positions are uneven. So Menü 2000 is a great example of the type of bolt-on we are looking for. Germany is a priority market, where we want to regain ground and particularly in the Corporate segment. Menü 2000 brings an established position with SMEs as well as a proven operating model built around the central production unit, it's own logistics fleet and strong culinary expertise.

Menü 2000 will retain its independent structure. That's for sure. We will preserve the local expertise and the client proximity behind its success. But we'll use Sodexo's scale selectively what it creates value. This limits complexity and management distraction. We are also actively managing the other side of the portfolio. In July, we sold Active Global in Asia, the remaining part of our former home care activities which we decided to exit in '23, if you remember, as it was not core to Sodexo.

Now let me be clear, M&A is not an objective in itself, not now. We already have a significant transformation underway. So we want to be careful about adding complexity. Our focus is on bolt-ons that support the organic plan and are manageable for the business. Any further transaction will need to meet that test and deliver the right returns.

Now I'll hand over to Sebastien to take you through the financial performance. Over to you, Sebastien.

Thank you, Thierry, and good morning, everyone. So revenue was close to EUR 24 billion. Organic growth was 2% with a stronger fourth quarter at 2.6%. Looking at the full bridge -- full year bridge, pricing contributed approximately 2.4%, like-for-like volumes around 0.6%, and net new business was around minus 0.3%. And the North American contract reclassification reduced group growth by around 70 basis points over the year.

The stronger fourth quarter reflected strong activity at Sodexo Live! in Australia and Latin America and additional client projects in Europe. Some of the downside risks, including our forecast also did not materialize. So it was a [ bitter ] finish to the year, but this is not the starting run rate for fiscal year '27. In the first quarter, we will face the timing of contract exits and openings. Meta is also still ramping up. We'll also continue to carry headwinds of around 100 basis points from the North American contract reclassification, broadly in line with Q4. And this impact will drop out in January. We, therefore, expect growth to start below the full year range of our guidance and build progressively through the year.

Turning to margin. Underlying operating profit was EUR 810 million, and the margin was 3.4%, down 130 basis points. The bridge had 3 main components. First, around 50 basis points related to the review of the contracts and assets, these covered areas such bad debt, litigation, onerous contracts and decisions to rationalize certain assets and facilities. The review was largely completed in the first half when most of the contract related provisions were recognized. The second half impact was more limited with no new broad category of risk identified. Our fiscal '27 outlook does not assume a repeat of the charge, although we'll continue to assess contracts and risk with the same level of rigor.

Second, higher operating expenses for commercial capabilities, supply chain and technology, reduced the margin by around 30 basis points. The impact was broadly evenly split across the 3 areas. And as planned, spending increased in the second half as deployments accelerated. On commercial capabilities, we said in July that the investment will represent around EUR 100 million of incremental annual operating costs once fully deployed.

Fiscal included only a partial impact as hiring took place progressively during the year. Spending will build further in fiscal '27 as these hires annualized and the remaining roles are filed. Technology programs were also still at an early stage and the EUR 500 million to EUR 600 million planned for technology and data is a cumulative investment through fiscal 2030, and most of it remains to be deployed. Investment will accelerate from fiscal '27, in line with the phasing presented in July.

The third and final component around 50 basis points came from operations. This reflects underperformance across parts of the portfolio. It also includes a tougher comparison in the second half as the prior year period benefited from a nonrecurring indirect tax item in Rest of the World. And improving operational performance is our major priority as we become more competitive commercially, rigorous execution is critical to protect contract economics.

Let me briefly close the operating review with the regional performance. In North America, organic growth was minus 1% for the year, with a trend that improved in the second half as the impact of prior contract exits started to fade. Organic growth was broadly flat in the second half, including a headwind of around 220 basis points from the contract reclassification. And for fiscal '27, we expect North America to return to positive organic growth. Europe grew organically by 2.1%, while Rest of the World delivered a particularly strong 9.7% organic growth.

On margin, North America recorded the largest decline and reflecting the 3 factors I've just discussed. And in Europe, the decrease mainly reflected charges from the contract and asset review. And in the Rest of the World, the decline was more pronounced in the second half and this largely reflected a tougher comparison, as I just mentioned, together with accelerated transformation investment including the ERP pilot in India. And you will find the detailed Q4 performance and the full breakdown by segment and region in the appendix. So that covers the operating performance.

Moving below underlying operating profit. Other operating income and expenses represented a net expense of EUR 290 million. The largest component was EUR 216 million of restructuring costs linked to organizational simplification, workforce transformation and the expansion of shared services. And these costs were partly offset by the disposal gain on Active Global. The restructuring charge was higher than discussed in July, mainly because of the provisions related to the reorganization project announced in France this summer were recognized earlier than initially expected. This changes the timing of recognition, but not the overall size of the program.

For fiscal '27, we expect other operating income and expenses to represent a net expense of around EUR 240 million including approximately EUR 190 million of restructuring costs. And together with EUR 216 million recognized in fiscal '26, this keeps the cumulative restructuring charge broadly in line with the EUR 400 million envelope we announced in July. The cash profile of restructuring cost is more gradual. Cash outflows were around EUR 100 million in fiscal '26. And at this stage, we expect most of the remaining cash impact in fiscal '27 with a residual amount in fiscal '28.

Net financial expense increased from EUR 88 million to EUR 137 million. This is mainly due to the full year impact of the U.S. dollar bond issued in May 2025. And for fiscal '27, we expect around EUR 190 million, reflecting the EUR 1.1 billion bond issuance completed in September and fewer favorable one-off financial items compared to fiscal '26. The effective tax rate was 23.4%, below the level of around 26% we had expected, mainly due to the geographic profit mix, including the Active Global disposal gain in Singapore. And group net profit was EUR 304 million, and underlying net profit was EUR 508 million.

Now turning to cash. Operating cash flow was EUR 1.1 billion, and free cash flow was positive at EUR 379 million. Working capital contributed EUR 75 million, supported by strong collections together with favorable timing and one-off effects. On a more normalized basis, we continue to expect working capital to be broadly neutral. Net capital expenditure was EUR 604 million or 2.5% of revenue reflecting higher investment in contract renewal and new business. And across the cycle, we continue to expect capital expenditure of between 2.5% and 3% of revenue mainly driven by contract-related investment at site -- at client sites and to a lesser extent, technology.

Net debt ended the year at EUR 2.9 billion and leverage was 2.4x. This was slightly better than the level of around 2.6x discussed in July, reflecting the stronger EBITDA outcome and better working capital and the disposal of Active Global. And for fiscal '27, we continue to expect leverage of between 2.6x and 2.8x reflecting continued investment in the business and higher restructuring cash outflows before deleveraging from fiscal 2028.

Thierry, back to you for the outlook.

Thank you, Sebastien. So for fiscal '27, we continue to expect organic growth of between plus 2% and plus 3% and underlying operating margin broadly in line with the 3.4% achieved in fiscal '26. Fiscal '27, as we said, is the second year of our rebuilding phase. As Sebastien explained very well, we expect growth to start below the full year range and then improve progressively. Our priorities are to improve retention, convert the pipeline that is building up and execute the ramp-up of Meta, but also our other new contracts.

On margin, the new recurrence of the -- the nonrecurrence, sorry, of the review charges and the first benefits from workforce, but also procurement actions will provide support. This will be broadly offset by the further step-up in commercial, in technology and supply chain operating expenses, together with start-up costs on new contracts. This is why we expect the margin to remain broadly stable in fiscal '27.

Now regarding our fiscal 2030 ambitions, they remain unchanged. Organic growth above 5%, net new business above 3% and underlying operating margin above 5%. What I'd say to conclude is this is a demanding transformation but the levers are largely within our control, and we have strong assets to build on. So confidence will come from results. Our job now is to continue to execute with discipline and deliver tangible progress quarter-after-quarter.

With that, Sebastien and I are now happy to take your questions. Over to you, operator.

[Operator Instructions] The first question is from Leo Carrington, Citi.

Firstly, could I just ask on retention. You delivered, I think, 94.4% this year. Is this something you can build further on in FY '27? Will the initiatives you've mentioned around retention come to fruition already this year?

And then secondly, I guess, adjacent comment, but could you elaborate on the comments about your improvements in the Education segment in North America? How is the turnaround going in some of the other historically more challenged areas of the business like North America healthcare? And together, Education and Healthcare, is FY '27 too early to see an improvement in these segments?

Okay. So I'll take it, Leo. Thank you for those two questions. I'll try to cover them. So first, on the retention, 94.4%, if you look back -- 2 comments on retention at 94.4%. On one hand, it's an improvement from the previous year. It's slightly an improvement from the previous year. It's actually -- if you go back 10 years in time, it's -- actually 15 years in time, it's the third best performance. So it's actually from that standpoint in Sodexo's term, it's a reasonably encouraging result. If you are comparing with our competitors, it's significantly below.

So what I mean by that is two things. One, it's an absolute priority or focus for us. And second, it would be foolish to assume that can be easily fixed. It's a structural and deep challenge for us, okay? So that's the starting point. If I look at '26 itself, there has been a pattern, okay? So I would say in some -- first, in some of the countries, the retention has been good. So it's not across the board. We have some who are not doing as well as others. So we know where to focus our attention.

One, for example, was, you mentioned it, and we mentioned it as well is education in America. We've seen also a pattern in the way we've slowly improved over the year retention. But again, retention is -- I think we're very clear on what we need to do on how we will improve the retention. Now we are being careful, I guess, in the way we are setting objectives for ourselves quarter after quarter because this is a long-term trend that we are looking for here more than anything else. So expectation for '27 ambition, obviously, is to do better. Now we'll see, okay? So far, so good. It's only the beginning of the year. It's a time of mobilization.

On the education itself. So what have we done? The team has done an incredible -- so first of all, most of the leadership of the education team is being renewed over the last 12 months. We have great leaders that have joined, they brought in talent with them. We have also promoted talent from within to reinject energy and client attention and focus. It's all about being present with clients every day. It's all about being -- visiting them. There has been a fabulous, I must say, fabulous mobilization from the leadership and the team in a kind of -- I do not want to use the word war anymore in this context. But retention mobilization, if you like, very specially in education where it's been about going to clients, accelerating massively the pace of the fresh eyes report. I don't know how much you know about it. But typically, what we are doing is, we are driving regular in-depth interviews of a lot of the stakeholders and our clients seeking feedback on which we have to act on.

So in a lot of the -- in most of the segments in America, this process was largely discontinued over the last years. So we have relaunched it and with fast pace so that we know where to focus our attention and immediately act on the actions. Because what's key, Leo, for us in retention is: one, get the feedback from the clients, step one; second, understand and turn it into an action for us and then execute, and that is obviously, not something. So it's not like you need to do it only 3 months before the renewal. It's throughout the life of a contract with our client.

So trust me, mobilization everywhere in the world, highly intense in America and in particular, I took the example of education. But I know that it's the case as well in healthcare and in corporate across the board.

That's very helpful. Could I just ask a follow-up? I mean thank you for that extra detail. In terms of the leadership for North America at a high level, how close to appointing a permanent leader? Or are you now finding it very helpful to extend the current arrangement?

I'm very happy with the way it works today. This is, I repeat, this is a business where each of the leaders today in America manage a business of EUR 2 billion to EUR 4 billion, which is the size of the other regions we manage around the world. So I'm very happy with the way it works. I myself spent 50% of my time in America, supporting them the most I can and certainly driving alignment across the board, but they run their business. And they don't need additional layer. That's the way I feel today. Things may change, and I'll keep you posted on whenever it is the case. But that's how it works today and it's working great.

The next question is from Jamie Rollo of Morgan Stanley.

Yes, two questions. First of all, on the better development of 7.7% and retention 94.4% that obviously implies net new of around 2% at a full annualized run rate. I'm really wondering what you're embedding in the 2027, 2% to 3% organic sales growth guidance on net new and also your pricing and volume assumptions within that?

And then secondly, just back on the phasing of organic sales. You've obviously reminded us about the 100 basis points accounting headwind continuing through Q1. And it sounds like net new will be skewed to the second half. Except for those 2 points, do you see a similar profile during the year on OSG? And are you seeing anything at the moment from the protests in France?

So I'll make a couple of points, and Sebastien will provide more details on the sequencing pricing and volume.

Okay. So a couple of points, Jamie. One, development and retention. First, keep in mind that if 7.7% debt, there is a significant ramp-up between Q1 and Q4 of '26, okay? And even excluding meta, we've seen an acceleration of our development in the second half of the year, and that's the encouraging part. It's not only an increase of the pipeline. It's also an increase of the contract signed. The retention, I covered it, so I think I don't need to get back to that.

I'll let Sebastien reflect on it. What I would say is on the philosophy of the way we've built our guidance for '27 is that, we continue to push hard on development, and we are expecting retention to improve. But at the same time, we know that I'm being personally in the way we are looking at the projection with Sebastian, we always take a little bit of care with the way we look at retention because, as I said in my previous point, although nothing lead us to believe that, that could go worse, it's something that you need to win every single day. So a little bit of caution here.

Just before I let you. You want to cover the phasing first and then I'll go back to the process in France?

So to your question, Jamie, on the guidance for fiscal year '27, what's embedded in the 2% to 3% guidance. So we -- we factor a minimum price increase of 2%. Then in terms of net new, we are expecting a contribution between 0.5% and 1%. And this will be largely driven by Meta. For the like-for-like volume, it's I would say, neutral, neutral to maybe slightly positive. And the remaining impact is the impact of the reclassification of the large contracts. This will impact. If you look at the fiscal 27-year around 30 to 35 basis points for the year, but it will impact 100 basis points for Q1.

And then if we look at the trend over the year, we do expect a slow start in Q1 and organic growth are expected -- is expected below the range and then this will progressively improve over the year with the ramp-up of the impact of the net new.

Then on the -- so thanks, Sebastien. On the protest in France, so first of all, one, obviously, as you can imagine, we are we are paying attention to it. We keep an eye on it. We are headquartered in France. And so the sooner the situation stabilize the better. Now having said that, first, for us, France, it's 12% of our business, okay? So it's not more than that. Second, our business in the high schools and where the protest are when it's not in the street is a, I would say, a modest size of our business. So it's not a significant at group level.

What I would say, overall, Jamie, is that, we're not seeing, I would say, material impact. We are a global group. We have presence around the world. We are obviously, looking at everything happening in 1 place and another in the third, and we know that we are in a world where it's not always stable everywhere. But so far, so good. Now of course, indirectly it's never good for an economy. But so far, no visible impact in terms of performance, Jamie.

Can I just come back on the pricing, 2% looks very conservative, given you did 2.4% last year and inflation is going up, not down. And also the net new half to 1%, doesn't that feel a bit light given your sort of KPI suggests more like 2%?

So to your second question or second remark. So clearly, what we said that there is a phasing impact between the impact of the demobilization and the ramp-up of the new contract. And if you look at the retention from fiscal year '26, especially in education in North America, in Europe, this will release a impacting September, beginning of Q1, while again, mobilization and openings will be more progressive over the year.

And on pricing, as you know, our pricing is a blended rate, first of all, between food cost and labor as well. Also, we are managing our internal inflation and our internal inflation in food is better, I would say, it's lower than the external inflation. So -- but on that, even if we do expect some inflationary pressure during the year, more in the second half than in the first half of the year. And because of this combination, again, of procurement mitigation and pricing on that basis, I still confirm our guidance above 2% pricing impact for the year. This remains an appropriate assumption at this stage.

The next question is from Simon LeChipre, Jefferies.

First of all, coming back on Q1...

Simon, we don't hear you too well.

Can you speak louder? We can't hear you well.

Can you hear me better now?

Yes, much better.

Sorry. So two questions and the first one coming back on the Q1 organic growth outlook. So it seems that you expect net new wins to be negative in the quarter. So when do you expect net new in the period to turn positive? And do you expect, what do you expect for volume in Q1?

And secondly, in terms of the margin outlook, any phasing to expect between H1 and H2?

So coming back to the forecast for Q1 organic growth -- as I said, we are expecting the ramp-up of menu during the year. Simon, so what we need to keep in mind is that the business mix between Q1 fiscal year '27 compared to Q4, it's very different because the weight of education is much stronger, and we do expect a negative organic growth in Q1 in education at the opposite the weight of Sodexo Live! is lower in Q1 versus very strong performance and strong rate in Q4, and we don't expect Sodexo Live! remain at a double-digit organic growth at the start of the year.

So this is clearly also explain why when we look out number we are expecting an organic growth to the start of the year, slightly below the overall range of our guidance for fiscal year '27.

And then on your second question is on the margin outlook, phasing between H1 and H2. So clearly here, what we see overall is that it should be -- if you look at the year-over-year, it should be broadly in line in terms of evolution comparison from fiscal year '27 and fiscal year '26, even if H1 margin could be slightly softer than fiscal year 2026. And H2 margin for fiscal year '27 might be slightly stronger because we start really getting the benefit of all the actions, especially the restructuring on the workforce.

Okay. So a very quick follow-up on -- coming back on net new, do you expect net new in the quarter -- in the period to turn positive as of Q2 or only as of Q3?

Honestly, Will not give answer on really the bridge of each driver by quarter. But I think what's very important is we do expect this improvement of the net new impact over the year.

Next question is from Estelle Weingrod, JPMorgan.

Two questions. The first one is on the GPO Entegra. I mean it's a big part of the equation in the turnaround story. You presented the situation at the CMD in July and what needs to be done. My question is how will we be able to assess progress what are the key KPIs to track and will you present them to us.

And just another question for you, Thierry. I mean now that you've been here for a year as a year what is one major initiative or change that is facing more friction than you initially anticipated?

I'm reflecting on your question to what I can tell you Estelle on the question -- I'll come back to the question one. But on the point number two is one thing that I found very interesting is that in fact, across the organization, everybody wants to win. And so the fact that we have mobilized Sodexo through Shift & Grow in a growth mindset. People love it. So I think the to drive the energy that is being pulled through by everybody, the mobilization, the alignment around the strategy is working well.

The -- but we know that we will never win on strategy. We know that we will win on execution. And so it's all about execution every single day, Estelle. So it's not -- there's no specific friction and at the same time, a normal attention to execution every day, which is tough. It's demanding and everywhere, people are working hard. So that's what I would tell you, honestly. For the rest, Shift & Growth is well understood. People are aware. They know it, they embrace it, they're aligned. Leaders are mobilized. And so I'm positively. I'm positive about the situation where we stand.

On your first question, which is the Entegra, you're right. It's a very important, it's a strategic part of our business. I've had the opportunity to say it first of all, we've presented the plan around Entegra and supply and the way we were aligning both Entegra and supply to really build an ambitious GPO serving the market but also Sodexo, leveraging scale on both sides, as being presented to the investor update has been, obviously, we have an action plan, and it's executing in the field every day. It takes a bit of time to roll it out because it's -- there's some it's a real transformation for the organization itself, but I think it's going well.

Sebastien, my neighbor here and I, we are doing reviews of the Entegra supply integration program every month, obviously, to track the performance, but also what the program we call convergence, right, that we've actually reviewed literally a few days ago, and we have a set of KPIs.

Now I'm not going to tell you, Eselle, we're going to shareholder KPIs, but certainly we do. And at some point in time, we'll provide you with some update on how things are progressing. It's a strong engine. I'm pretty happy with the way it's progressing. The second thing I would say, Estelle, is that we have developed a program, transformation program called TOM, which defines our operating model and align our supply machine to this operating model. And that is also with savings associated with it, which are reflected in Shift & Growth projection.

And let's face it. we will need the deliverables of Entegra to deliver our ambition for Shift & Growth 2030. It's on track so far so good. We'll keep you posted sometimes.

The next question is from Pravin Gondhale, Barclays.

Firstly, on FY '27 margin guidance, similar to Slide #10 in the presentation deck. Could you please quantify the bridge to the broadly flat margin year-on-year? So between the operational recovery recurring investments and the other buckets on the slide. And then secondly, on the leverage. Leverage ended at FY '26 slightly better than what you had anticipated previously. Does that -- does the additional headroom change your priorities between reinvestment, bolt-on M&A and further de-leveraging?

I think that's for you, Sebastien.

Yes. So on the first topic on the first question on the margin. So clearly, guidance is to have a fiscal year '27 margin broadly in line with '26. It means around 3.4% for fiscal year '27. And then if you look at the different buckets, so we are not expecting any large review and contract assets done already, okay? So we will continue again what we said that we'll continue to apply our framework, our rigorous framework looking at contract and assets, but we do not expect any significant impact on this bucket.

Then as we said, we'll have clearly the impact of the acceleration of the investment. So clearly, this impacts the margin, fiscal year 2027 will be a year of investment with deployment, peer development on the commercial investment on technology and on supply. And then you will have the positive impact because we are not expecting any way a negative impact coming from the review contracting asset, but we get the positive impact because. So this will neutralize the impact of the investment.

And on the operation, on the last bucket, we will have a combination of different impact. We'll have some early benefit of the initiative. But also, we'll have also the impact of the new contract mobilization. We have some initial cost on the mobilization. And also we had the impact of our commercial -- commercial aggressiveness, I would say, price to win that impacts also the margin in fiscal year '27.

And then on to your second question on the leverage. So as I said in July, so we do expect leverage between 2.6% and 2.8%. And there is no -- at this stage, there is no expected change regarding our M&As. I mean we are talking really about Modex transaction bold M&A, as Thierry said. And we're also working on the asset disposal and some arbitrage when we look at our portfolio of assets.

Next question is from Neil Tyler of Rothschild & Co Redburn.

I just wanted to come back to the delayering and ask for a bit more of your insights on how you're ensuring that you don't lose expertise or damage client relationships. I'm sure you've thought about this very carefully, but I wonder if you could sort of share your thoughts and experience on that particular topic?

And then Secondly, can you help us understand maybe in terms of either organic growth or net new, the different dynamics over the next 12 and 24 months between Food and FM, please?

Okay. Thanks, Neil. So I'll take the first. It's a good question. For sure, you're absolutely right. The delivering sounds like a great idea, but you need to make sure that you're not losing talent. And certainly, what's our obsession the right connect with our clients, okay?

So what mean -- what has driven the work has been A couple of points. One is the -- whatever we call the spans of control okay. So typically, first, what did we do is, first, we looked at how many layers exist between the youngest member of the team and the CEO of a business, right? And we just build up the tree all the way back up and say, okay John reports to Susan and Susan reports to -- and that's how we did that. And then we started to look at okay.

What's everyone's role here, right? So one is connected with the client, engage with the client and work on delivering services to the client than above, what are the roles versus layers of aggregation. And that's how we started to define the roles that matter versus the one that we feel are being just aggregation and that can be simplified because then span of control comes into plan.

If you are a manager and you're managing two individuals, then maybe you should run more than two individuals if you're a good manager. And that's where we started to rationalize organizations, unit-by-unit and started to remove layers. The efficiency of such decision is incredibly important, not only in terms of cost but also in terms of operational, yes, efficiency and productivity, ability to make decisions about ability to get messages across all of that is dependent on the number of layers. So that's how we drove it for sure to make sure that we are not losing expertise.

And to your second question on the organic growth. So if we look at fiscal year 2026, the organic growth in facility management was higher than in the Food. We ended the year at 2.9% organic growth in Facility Management and 1.6% in Food. And if we look forward next 12 months, we do expect higher -- I would say, higher organic growth in Food, mainly driven by the ramp-up of the contract of Meta. And then the overall also will depend on volume and on the commercial activities. But definitely, Meta will be a key driver of the organic growth of [indiscernible].

The next question is from Jaafar Mestari, BNP Paribas.

I have 2, please. So firstly, on the contracts and assets review now that you've completed it. I think the total noncash hardest have reached EUR 120 million. Could you confirm that it's mostly complete? And are you able to tell us now what's the total revenue attached to these contracts for which you've had to take provisions?

And then secondly, on assessing the organic growth from here and you make very fair points that 2.6%, which is the Q4 exit rate, if you want, it really shouldn't be the starting point because of the mix. I've done exactly that. I've taken your organic growth by segment in Q4 and I've re-weighted it for the revenue business mix of a normal Q1 and what it spits out is 1.5%.

So is that the starting point for Q1? That's still with slightly positive in that new business in the last month of the year. You seem to be saying this more losses that will incrementally hit us before some of the winds start ramping up. So really trying to 0 it on Q1. Is it 1.5% with downside, please?

Yes. Okay. So I'll take at the beginning, Jaafar. I think on the first point, your -- the contract and asset review. As we said, the best part of the work was done back in April, was it April? -- in March -- back in March, I guess, back in March a couple of adjustments, but I would say this is -- now we are back to business as usual, okay? It's not the same. There was a need for this review. Now it's just ongoing process where we review the level of risks every quarter and take actions based on this. But this is not in a context of a discontinued process, if you know. It's just back to no more disciplined in the process. The total revenue related to these contracts, I cannot tell you the amount, but it's not significant. Interestingly enough, Jaafar, those risks were not coming from the largest account or the largest contract necessarily. Sometimes those are the ones that are smaller in size where we've had not enough attention to it. So all I can tell you is this is possibly less of the total revenue that's what you would have in mind, I guess.

For the second one, you take it, Sebastien?

So again, as I said, I don't think that really the performance of Q4 is really a good proxy for the forecast of Q1. Probably better to look at Q3 and the mix by segment. So we -- for Q1, we do -- we don't especially expect a negative net new contribution in Q1. As I mentioned before, it would be a progressive ramp up during the year. And as I mentioned, you have the fading of the opening and the closing.

That means this fading is less supportive than in Q4. And Q4 benefited by, again, as we said, some events in Sodexo like. But overall, if you look at the trend, again, by region, by segment, as I said, we should be Q1 organic growth should be slightly below the range of the year.

The next question is from Kate Xiao, Bank of America.

First, I wanted to clarify on net financial expenses. Obviously, you've guided that to go up a bit in '27. If you look at a slight of your deck, there is EUR 800 million of bonds maturing in April 2027. I just want to confirm if the maturity and refinancing of these is already part of the guide?

Second question on capital allocation, Thierry, on Slide 7. You mentioned deals you've done. There's a couple that was completed in early '27. I just wonder whether you could give a bit of color of what's in the pipeline? What are you looking at in terms of M&A in '27 and some of these deals?

Okay. So all I can say -- maybe I can take the one on M&A?

And then we'll tell you one on the financing.

Okay. So on M&A, I don't think you should expect anything material, as we said. We are doing bolt-ons within the budget that we get to ourselves in a given year. We are being consciously carefully the way we are going after M&A not by condition, but more just by the fact that this is part of the way we've structured Shift & Growth 2030, where we are saying '26, '27 is about structural transformation and therefore, more focusing on our back-to-basics and on our improvements and discipline.

So M&As, specific bolt-on tuck-ins when justified in a given market. but nothing of material to be expected for the foreseeable future.

Okay. And to your first question, yes, as we raised EUR 1.1 billion in September. And this was really the anticipation of the repayment of the EUR 800 million bond that will mature in April. So the cost of that is fully embedded in our guidance of EUR 190 million in terms of financial expense for fiscal year '27.

The next question is from Jarrod Castle, UBS.

Just the first question, I mean you spoke about 0.5% to 1% net new of which matters a big chunk of it. I'm just wondering, when you're looking at your pipeline on a gross level, which industry segments are healthy, which industry segments in terms of bids may be less healthy or are you less focused on?

And then second question, Thierry, you spoke about kind of employees being very motivated, et cetera. Have you done any internal surveys in terms of the employee mood, especially at the head office given restructuring and any points you'd like to pull out if you have in terms of culture, motivation, et cetera?

So Jarrod, thanks for the two questions. So the first one, so the pipeline, right? Your first question is around the pipeline. We have a, I believe, today, I'm scanning through my head. I believe pretty much every single of our segments are showing pipeline increase, okay?

By virtue of extreme focus on building it up being proactive. I think we've seen it, now what are the ones that are the strongest? We have an increased volume of pipeline from large accounts in the corporate world, okay? We have a strong pipeline building up in the health care world.

And I would say also strong in the sports and leisure world. So I think it's, frankly, looking at the pipeline opportunities are here significant acceleration. But again, you will notice my caution. It's great pipeline, you want to turn it into deals. That's what we are working on.

The point number two, which is about the question of the motivation of the employees and surveys and so on. For sure, we are doing survey, we are doing survey regularly, for example, in the context of Shift and Growth to make sure that our managers understand and feel part of Shift & Growth but also just to make sure that they are aligned and are completely on board with what we are doing.

No, in a few hours from now, I will handle accord with our -- this is a forum of several hundred leaders across the organization where I will share with them everything we discuss now. And we do that regularly. So we have constant interaction. We have also surveys and feedback for sure. We are very aware that whenever we have difficult discussions or moments that are not easy to handle, like some restructuring activities going on in some countries.

And we are handling it with the best care and the best attention to most sense of respect for sure, and that's the Sodexo way of handling things. But I feel that the level of motivation is certainly high and the energy and the confidence in the future is really comforting at the moment at Sodexo.

The next question is from Johanna Jourdain, ODDO BHF.

So regarding the Meta contract ramp-up given its size and the fact that it's relatively new area. Have you identified any specific execution risk in delivering the required services quality? And when should the contract reach normalized margin? And the second question, and more generally, could you please share any comments on your pipeline in the data center space?

Okay. So the first one is Meta. We started, I believe, the transition sometimes in June time frame, I believe. I need a transition that takes several weeks and months. So we are still in the middle of it. It involves many, many, many little projects, if you like. We have 130 sites across 30 countries. So there's thousands and thousands of people involved every day. We obviously, as you can imagine, we have a I would say, telco at group level, and we're exchanging with the Meta team regularly to stay focused and aware of where we are. And we have the direct connection with the with the executive of Meta as well to make sure that whenever there is a need, they can reach out to us and my cell phone in particular. So far, so good. We are progressing well. it's still early stage, but it's progressing, frankly, well. So I would say, positive when contracts should normalize margin Sebastien?

During the second half of the year, yes.

And then for the -- or the question on the pipeline in data centers. Yes, we have -- so what we've done on this -- in this field. So first of all, data centers, we already work with some of our clients around data centers in several of our countries, in particular in America, for sure. There is a growing pipeline, that's for sure. And we have also built our own offering around data center, our solution, it's called Sodexo Edge. That we are deploying around the world. What we are doing here, Johanna, is that we are leveraging two things.

One, our very, very deep expertise in the remote site management, right? The fact that we are managing and we've been managing for decades remote sites, whether it's in the mining, in the oil industries. And they are very much relevant in the phase of construction of the data centers. And of course, we are leveraging also the second aspect, which is the strength of our portfolio of clients in the tech industry.

Obviously, one client, you know the name. We just mentioned it. There's others with whom we are working. So we are expanding. We've built a specific team to go after this market of data centers.

We today operate north of 100 data centers, but the potential of growth is significant. So we are on it. We'll keep you posted as we grow as well.

Gentlemen, that was the last question. I turn the conference back to you for any closing remarks.

Of course, Okay. Thank you. So thank you, everyone, for your questions. We have -- as you have seen, we have a clear plan. We have -- the actions are underway across the group. What really matters and believe me, this is an absolute paranoid obsession on our side, focused on disciplined execution and turning these actions into results. That's our focus for fiscal '27 for sure. And we look forward to updating you as the year progresses. Thank you for joining us. Have a great day.

Thank you, ladies and gentlemen. Thank you for joining the conference is now over, and you may disconnect your telephones.

Good afternoon, everyone, and welcome to Sodexo 2026 Investor Update. I'm Juliette Klein, Head of Investor Relations. Thank you for joining us, whether you're here in Paris or following the webcast.

Before we begin, please have a look at the disclaimer regarding our forward-looking statements. And while that's on the screen, a couple of housekeeping points. Our press release was published earlier this morning, and today's presentation is now available from -- for download from our website. A replay of the webcast will also be available shortly after the event. For those here in the room, the emergency exits are located at your left. If you need any assistance during the event, our team will be happy to help.

Let me quickly now go -- walk you through today's agenda. Thierry Delaporte, our CEO, will start by taking you through where we are today, the market context and our Shift & Grow 2030 road map. Along the way, you will hear from several leaders who will provide additional perspectives on some of the key initiatives supporting the plan. Sebastien De Tramasure, our CFO, will then present our financial ambition and capital allocation framework. Thierry will come back after for some closing remarks. We'll then open the floor for Q&A, both here and on the call.

So, with that, Thierry, over to you.

Juliette, thank you, and welcome, everyone. Welcome to our investor update. We are very happy to have all of you here today with us for this presentation and to see many of you joining us online as well. So today is about clarity, clarity and commitment on where we stand, on what needs to change and how we move forward with discipline. We will bring clarity on our positioning and on the strategic priorities that will help us accelerate growth and restore competitiveness. We will bring clarity on our execution plan, the three pillars and tech enablers that support it and the progress already visible across the organization. And finally, we'll bring clarity on the financial trajectory we believe this plan can deliver and the value creation opportunity ahead of us.

We know that we have underperformed for many years. That is the starting point for today. We are not here to make excuses. Our objective is to explain what is changing and why we believe it will make a difference. This is a multiyear journey, but this is not a story of wait and see. Actions are already underway with, you will see early signs that the organization is moving in the right direction. And today, you will hear not only from me, but from some of the leaders who are driving this transformation on the ground. Damien, who leads Entegra, our GPO and supply engine; Alice, leading tech; Soorya, leading talent and development; Sebastien, our CFO, who you all know; and David, who leads commercial strategy and execution in North America.

Back in April, I shared with you my first impression and first assessment of the business after a few months in the field with teams and clients. Today, I want to go one step further, not only to revisit the root causes of our underperformance, but also to explain the choices we are making, how we intend to win and how these choices translate into a clear operational and financial road map. We have underperformed our peers and the market. That's a fact. This was not a market issue. It was mostly an execution issue.

What matters in our industry is actually very simple. Are you close to your clients? Do you understand what they want? Do you act on it? And how fast? Can you deliver consistently? And are you competitive? If the answer is yes, you grow. If not, you lose. Over time, we moved away from some of these fundamentals. When I spent time in the field, I saw a business with tremendous strength. But I also saw that we had drifting in how we operate and wherever I went, four things came back very consistently. First, growth stopped being the primary lens. Over time, the organization became too risk averse that affected behaviors, less commercial intensity, more caution in competitive situation and not enough willingness to invest early in client relationship. Too often, we were simply not close enough to our clients. Our excessive focus on protecting short-term margins ultimately made us less competitive. Too often, we price from our cost base rather than from the market. As our cost base became less competitive, so did our offers in our industry, which is highly labor-intensive, sustainable margin comes from growth, scale and retention.

The second issue was complexity, empowerment and decisiveness. Decision-making became too centralized and too slow, too many layers, too many approvals, too much distance between leadership and day-to-day execution. Decisions were revisited several times and not always executed consistently.

The third issue was that we had not invested enough in the capabilities required to operate consistently at scale. That starts with talent. We need to attract, develop and retain the best people. And that also means being prepared to pay competitively for critical capabilities where they create value. Beyond talent, it means investing in sales force and account management, in supply, in workforce management and tech systems, data. These are business-critical capabilities, and we simply did not build them early enough or at sufficient scale. In some instances, we accumulated a technical debt that became business critical.

And lastly, this became particularly visible in North America. The U.S. cannot be managed like another country. It's effectively another headquarter. We are competing here against global leaders in their home market, and that requires a different level of leadership intensity, investment and speed. We were not always operating at that level. That is changing. So this is the starting point. It's not conceptually complicated, but it is demanding.

What is exciting is that we operate in large, growing markets with strong long-term fundamentals. Food and facility management together represent a market of more than EUR 1 trillion, growing at around 4% per year. At the same time, client expectations continue to evolve, driven by several structural trends. First, outsourcing continues to grow. Clients are facing labor shortages, increasing operational complexity and higher expectations around service quality, productivity and compliance. Second, many large organizations want to simplify the way they operate. They are consolidating the number of suppliers, reducing complexity and looking for fewer partners who can deliver at scale. Third, demographics continue to support growth, especially with aging populations and focus on longevity, where we see health care evolving the continuum of care and driving long-term demand. But we also see employers placing greater emphasis on the workplace experience as they compete to attract and retain talent in corporate organizations, hospitals, remote camps and educational institutions. And finally, technology and AI, in particular, is raising expectation around productivity, transparency and service quality across all segments. It's also creating new growth opportunities within the tech sector, particularly in areas such as data centers.

Now taken together, these trends are changing what it takes to win in our industry. Clients are looking for partners that can operate at scale, execute consistently and deliver high-quality services across geographies. Winning starts with understanding that not all clients have the same expectations and operating environments. Not all clients are looking for the same solution. Some clients want a best-in-class food partner, able to offer a large range of food solutions from value for money to premium experiences. Others are looking for deep expertise in a specific FM service. Increasingly, some want an integrated food and FM solution delivered through a single partner, again, to reduce complexity, to ensure a consistent experience and improve performance. So client centricity starts with understanding client needs and serving them accordingly.

Let me now illustrate with two examples. First, tech sector. Within our Corporate Services segment, tech today represents close to EUR 1 billion revenue in our portfolio and is one of the fastest-growing sectors. It's also a sector I know well, having worked closely with many of the clients throughout my career. But tech clients are looking for food solutions that go well beyond traditional on-site dining services from premium retail and barista coffee concepts to pantry, micro markets, even catering, workplace services. Many also value partners simplicity and consistency across occasions. And within this tech sector, many of you have asked us specifically about data center. Well, today, we already provide dining, convenience and workplace experience solutions for several of the leading operators and hyperscalers, particularly in North America and Asia Pac. But the opportunity extends across both operational phase and construction.

During the construction phase, sites often require services for a large workforce operating in complex or remote locations. Well, these are capabilities we have developed over many years through our remote site and village operations. In fact, we have recently secured our first food services contract supporting a data center construction project. It's relatively modest in size, but it helps us build our experience and deepen our relationships in this sector. But to be clear, overall, we see tech and data centers as attractive growth opportunities. We already have a presence in the sector. We have capabilities that are relevant, and we intend to build on that foundation over time.

The second example is airport lounges. It illustrates a different type of opportunity. Here, the differentiator is experience. Over time, we built capabilities, we invested selectively and leverage our global footprint. Today, we are seeing the benefits. Let's hear directly from the team.

[Presentation]

Focus execute scale. We know how to do it. These examples illustrate the same principle. Clients are looking for a partner that can adapt to their specific needs while delivering consistency at scale. This is exactly where Sodexo stands out. We hold a distinctive market position with leadership in both food and facilities management. We operate in more than 40 countries, allowing us to deliver a seamless and consistent experience. This positions us as the one trusted partner to support large, complex organizations across multiple geographies and service needs. This allows us to bring the best of Sodexo to our accounts. But we also have something that is much harder to replicate our service culture.

For almost 60 years, we have built our business around people, client proximity and operational excellence. That culture remains one of our greatest strengths, and it's reflected every day in the quality of services we are delivering. And finally, but not the least, sustainability. We have established the undisputed leadership on this topic. It shapes the way we run the business through our Better Tomorrow road map. We are helping our clients achieve their own sustainability ambitions. We are continuously reducing our environmental footprint through measurable externally validated commitments. And we are making a positive contribution to the communities where we operate and it matters. And above all, it starts with our people. Sodexo is a place where people can learn, develop, build careers, create opportunities for themselves. That has always been part of who we are, and this makes us a stronger company. It helps us attract and retain talent. It strengthens our relationships with clients. It increasingly supports our commercial success. We see sustainability as one of the foundations of long-term profitable growth and value creation for our stakeholders. Taken together, these strengths gives us tremendous opportunities.

The next step now is to leverage them more systematically and at greater scale. It starts with being absolutely clear about where we play, where we invest and where we can create the greatest value for our clients and our stakeholders. Over time, however, our positioning became less consistent. A gap emerged between what we said to the market, what market understood, what our teams do on the ground and what our clients actually expect from us. At times, we created confusion about how we positioned our priorities between food and FM. Today, with Shift & Grow 2030, we are removing that ambiguity. We are not changing who we are. We are clarifying where we play, where we invest and how we compete in both food and FM.

We absolutely want to be client first, but client first doesn't mean everything everywhere at any cost. It means making clear choices to create more value for clients and shareholders. This means being more disciplined in how we allocate resources, management attention and investment. We reviewed our entire portfolio and asked a few simple questions. How are our client needs evolving? Can we build a leadership position? Is the market attractive enough? Can we scale profitably? But also is the model repeatable? And can we create sustainable value.

This translates into choices at three levels: geographies, segments and services. First, geographies. The U.S. is a clear priority for the group to restore competitiveness and accelerate growth, absolute priority. It remains the most attractive market for us. But beyond the U.S., we will concentrate investments in a limited number of core countries where we see the opportunity to grow and win. Elsewhere, we take a more disciplined approach, more continuing to support our global clients for sure, while focusing more on profitability and cash generation.

Second, we are clear about the client segments where we believe we can create the most value and build sustainable leadership positions. At group level, health care, corporate and Sports & Leisure are clear priorities. These are large, attractive markets where our capabilities, scale and client relationships position us particularly well to win. Our other segments such as Energy & Resources, seniors, education or government are local growth opportunities. This means that each country focuses on global priorities and one or two additional local opportunities where relevant to build leadership. For example, in the U.S., our business in education is very large and a critical growth opportunity. Similarly, in Australia, we will continue to grow our energy and resource remote site business, delivering an end-to-end food and FM integration solution.

Now the third level is services and capabilities. In food, our priorities remain clear. Food is often where the client relationship starts, and it remains our strongest anchor. We are expanding into the full food ecosystem with convenience and retail offers to capture more opportunities within existing accounts. FM and all the other services we are providing to our clients also play an increasingly important role where it makes sense for our clients and for us, they help us open new doors, grow existing accounts and create more value.

Finally, we will be pragmatic and disciplined in how we build capabilities. Where we believe we can develop real expertise and scale, we will invest. Where we can't, we will partner. The objective is simple: providing the best solution for the client while ensuring consistency, scalability and value creation.

Now within all this, M&A is an enabler. Our growth plan does not depend on acquisitions, but targeted acquisitions can accelerate it. It allows us to strengthen the differentiated capabilities, bring in new talent, expertise, expand the solutions we offer to clients and accelerate access to attractive segment and priority markets. It can also deepen our relationship with existing clients while creating additional value through scale and synergies. We'll look at bolt-ons that strengthen priority markets or critical capabilities, for example, vending or GPO. The discipline is clear, strategic fit, financial returns, value creation.

Now that I've clarified the choices we are making, let me take you through our ambition and how we will deliver it. By 2030, we want to be fully back in the game, a company that competes with the best in our industry, delivering consistent growth, improving profitability in a disciplined way and becoming the partner of choice for our clients. That ambition requires a clear execution framework. We call it Shift & Grow 2030. It is built around two objectives: accelerate growth, restore competitiveness. We are addressing those through three pillars and enabler. You will hear today from some of the leaders responsible for driving initiatives within Shift & Grow and how they are already translating them into action.

First, I said we are rebuilding the growth engine. We are strengthening the capabilities, the processes and the mindset required to grow consistently. Second, we are transforming the way we operate, reducing complexity, improving productivity, leveraging our scale much more effectively across the group. Third, we are strengthening our performance culture, creating a company that moves faster, execute more consistently and holds itself to higher standards. And fourth, as I said, we are accelerating investment in tech and data, not as a separate strategy, but as an enabler of growth of productivity and execution at scale. Sustainability underpins all of this. It's at the core of Sodexo's DNA. It strengthens the long-term resilience of our business, but also sharpens our client value proposition. It also gives purpose to our teams. When we do good for our clients, our people, society and the planet, engagement grows, and this fuels our ability to perform and win.

Now before we look at each pillar, let me explain how we intend to phase the transformation. Fiscal 2026 and 2027 are about rebuilding the foundations and restoring competitiveness, restoring commercial momentum and improving execution discipline, simplifying the organization and reinvesting in the capabilities, systems, infrastructure we need to support future growth. From fiscal 2028 onwards, the focus progressively shifts towards scaling the model, accelerating growth, leveraging the investments we are making and improving profitability more meaningfully over time.

All of this translates into clear financial framework. Let me start with fiscal 2027. We expect organic growth between 2% and 3% and an underlying operating margin broadly in line with fiscal '26. Let me be clear on how to think about it. Fiscal '27 is still a year of rebuilding. Our priority is not to maximize short-term margins. Our priority is to rebuild the foundations of the business. That means continuing to invest, strengthening our commercial engine, simplifying the organization, fixing execution where needed. We believe this is the right way to create stronger and more sustainable performance from fiscal '28 onwards. Looking further ahead by fiscal 2030, we believe we have the capacity to consistently deliver organic growth above 5% and underlying operating margin above 5%.

And that brings me now to capital allocation. Delivering this plan requires discipline, not only in how we operate the business, but also in how we deploy capital. We'll continue to invest behind our strategic priorities. At the same time, we remain committed to maintaining a strong balance sheet and a disciplined approach to capital allocation. Sebastien will come back to that in more details, but the principle is straightforward. Every euro we invest, whether in the business, technology or acquisitions must strengthen our competitive positioning and create sustainable shareholder value. So we've talked about the destination.

Now let me show you the journey. Everything that follows is about execution. It's about the actions already underway to rebuild growth and competitiveness. Let me start with the first pillar, rebuilding the growth engine. Growth starts with our clients, keeping the clients we already serve, winning new ones, competing more effectively and building a stronger relationship with our largest clients.

These are the four priorities driving our commercial transformation. So, first, retention. This is fundamentally a relationship business. When we lose a client, it's really because of a single operational incident. More often, relationships weaken over time, concerns are addressed too late, then by the time we enter the renewal discussion, the outcome has often already been decided. That is why our biggest opportunity is to fundamentally strengthen account management. Today, honestly, accountability is often too fragmented. Several people may be involved, but no one is fully accountable for the relationship. We are changing that. Every strategic client will have one clearly identified account manager with end-to-end responsibility for client satisfaction, retention, growth and financial performance overall.

By the end of this calendar year, this will be in place for all of the top 200 clients. At the same time, we are making the entire retention process much more systematic. We have introduced dedicated retention rooms for our highest priority renewals and are building proactive retention plans up to two years before contracts come up for renewal. And trust me, it's pretty new. U.S. education is a great example of why we are changing the approach. The challenges are well known. In many cases, they reflect issues that had built over several years and client concerns that have not been addressed early enough. relationship reaches that stage. It's extremely difficult to reverse the outcome during just a single renewal cycle. So that is why our response goes well beyond individual renewal efforts.

Of course, it's the responsibility of the account managers, no doubt about it. I said it, but I also want our leaders to be personally involved. I have renewed the leadership team here, I can tell you, very active on the ground with clients. I feel today an intense mobilization, especially around retaining our business. These actions will not change every renewal overnight, but they fundamentally change how we manage client relationships going forward.

Second, new business development. Retention alone is not enough. We also need a much stronger engine to win new contracts consistently. That starts with investing in commercial capacity. We are increasing sales resources in our priority markets. We are bringing in experienced hunters from other B2B service industries. In the U.S. alone, we expect our sales team to be more than 30% larger by year-end. This will be the result of both significant recruitment and the continued strengthening of our commercial organization. This commercial focus is also reflected in our leadership. Today, around 20% of our top 250 leaders are account managers or day-to-day client-facing leaders. It was less than 5% just a year ago.

Adding people is only part of the answer. Growth should no longer depend on individual efforts. That's the reality. It needs to become a repeatable commercial system. Not all sales opportunities require the same level of expertise. So we are also introducing a much more standardized approach for smaller opportunities using configurable offers, common proposal templates and AI to prepare, structure, process bids more efficiently and consistently. This allows us to -- allows our most experienced commercial teams to focus on our largest and most strategic opportunities as well. But above all, commercial excellence is very much a matter of intensity and discipline, the energy to fight, to compete, the appetite to win.

Third, now, price competitiveness. Winning more business is also about competing more effectively. For us, becoming more competitive is not about simply lowering prices. It's about becoming much more disciplined in how we approach opportunities. It's about pricing to win.

I told you how we used to start from our cost base. Now we ask ourselves what it takes to win this opportunity. This is a deliberate change in our pricing strategy. We will compete where we want to win. We will make ourselves competitive by addressing our cost base at the same time. That requires much better preparation, understanding the client, the competition and the economics of the opportunity before designing the offer. The objective is to make pricing decisions based on understanding what success requires. In fact, when you review major opportunities today, I often say to the teams, one, are you clear on clients' expectations? Second, do you know what's the winning price? If the answer is no, then there's no discussion. Today, every major bid goes through a structured price to win review. It allows us to design better offers to make better investment decisions and to be much more deliberate about where we compete.

Finally, large account strategy. Large global clients represent one of our most attractive growth opportunities. Historically, we have not captured our fair share of the largest opportunities despite having many of the capabilities that matter most to these clients. Our breadth of services, global footprint, integrated operating model and single governance makes us honestly, uniquely positioned to serve large, complex national or multinational organizations. So we want to fully leverage these strengths. That's why we are putting in place a different commercial model, identifying our highest potential accounts, developing dedicated account strategies, investing in senior account managers and strengthening global account oversight.

Let me make this more concrete. I want to show you a recent example of what this commercial engine looks like when it comes together. Over the past months, we have been selected by Meta to deliver workplace food services across more than 130 locations in over 30 countries across very different operating environment.

The reason I'm telling you this is not only to celebrate the win. It's because it shows what happens when we bring the best of Sodexo together and operate as one company with aligned teams, high intensity, clear ownership and the right expertise around the client. When we do that, we become a formidable competitor, able to compete and win on the largest global opportunities. And I'll let the team tell the story.

[Presentation]

What you just saw is exactly the point of this first lever. Two takeaways. First, these clients are not buying a service. They are buying consistency, accountability and the ability to deliver at scale across a complex global footprint. And second, this cannot rely on a few individual heroes. We are working on building a repeatable commercial model.

Now let's deep dive with David, who leads commercial strategy and execution in North America. He has been at the center of redesigning how we approach large clients, structure opportunities and improve commercial discipline.

David, over to you.

Thank you, Thierry. The Meta example is a fantastic example, but it is just one example. Congratulations to Damien and Catharine, Martin, Joe, Alice and the team. It was a win, and it really is a strong proof point. But it's also part of a much bigger opportunity. Large accounts are central to Sodexo's ambition to deliver more predictable, profitable growth. In the U.S. alone, large accounts represent $75 billion in addressable spend. That's about 15% of the total market. It is a significant market, and many large organizations remain underserved by traditional sectorized approaches. Large accounts operate across multiple geographies with various sites and all kinds of services. They involve multiple stakeholders, and therefore, they demand strong account governance.

The thing they want least is multiple vendors and fragmented contracts. They want -- they're seeking simplification. They just want a partner that can operate at scale, deliver consistently and bring clear accountability across all the geographies. One of these clients told me, David, anyone can serve our headquarters. That's the easy job. What I need is someone that can support us across our entire footprint. That captures the challenge very well. Winning large accounts is not only about what you sell, it's also about how you sell. I tell my team, good sellers can tell you why to buy from Sodexo. Great sellers can tell you not only why to buy but how to help you how to buy. Differentiating yourself during the buying experience is critical with these large clients. And when we do this, we know we can win. We've already proven it. You saw it in the airline lounge business. We've proven it in sectors such as fast-moving consumer goods and in health care. But we've not done it consistently enough across the entire portfolio. So we are changing the way we're going to work.

First, we're going to select differently. We've identified priority accounts that Sodexo can truly differentiate and create long-term value. This means focusing our resources on the strongest areas where we have a right to win. Out of the 800 clients we've identified, we've already identified the first tranche, which is circa 15% to start proactively developing those opportunities. For example, we recently targeted a client who had a gap in service coverage in some countries where one of our competitors had recently vacated. We were able to quickly structure a contract to support them.

The second change is how we design and price opportunities. We now spend much more time upfront. And this is not only to better understand the client, but also understand how they buy and what is the likely price to win. Once we have that level of clarity, we're able to design a solution that is easy to purchase, that meets the client's expectation and is attractive to Sodexo from a returns perspective. This creates much greater discipline. For example, we are in the midst of completing a contract with an existing client to add several sites where they're currently self-performing the services.

Third, we're making ownership much, much clearer. We're asking ourselves who leads the relationship? Who makes the decisions? Who is accountable for execution. And fourth, we are gaining much greater discipline and speed to how we pursue these opportunities. It's important to remember that the complexity and time are the key silent killers of growth in any organization. We now operate through structured win rooms, bringing senior cross-functional leadership expertise together much earlier in the process. These deals are built collectively from day one.

There is -- the client is at the center of all these opportunities. As a result, opportunities move much faster, decisions are clearer and clients experience a much more seamless approach. In one recent example, a win room expedited the extension and expansion with one of our largest clients in the U.S. Early signs of progress and momentum are building. Yet we are still at the very beginning of this journey. We do have the operating model. We're building the governance and the team is now all in place.

Now we can scale this approach. We're already seeing encouraging signs. Our large accounts pipeline is much more structured and focused. And even more importantly to me, the quality of the buying experience for these clients is improving.

Let me close with three messages. First, large clients are the most attractive growth opportunity for Sodexo. Second, we have the assets and we know how to win. And third, we are now investing to ensure our approach is scalable and systematic.

Thank you. Back to you, Thierry.

Thank you, David. What David described is exactly the type of commercial discipline we need to accelerate growth. Over recent years, our net new business growth has been around zero. The first pillar is designed to fundamentally change that. We'll track proactive retention through retention rate, new business through development rate, pricing competitiveness through bid rate and our ability to unlock large accounts through the growth of our related pipeline. Bottom line, success will be measured by one outcome, a return to sustainable profitable growth. By 2030, our ambition is to consistently generate more than 3% net new business growth, supported by stronger client retention and greater business development.

Let me now turn to the second pillar, simplifying and standardizing how we operate. The pillar is about making Sodexo simpler, faster, more competitive. What we are now putting in place is much more standardization around operations, workforce productivity and procurement. The objective is to remove unnecessary complexity so teams can focus on clients and our operations. It starts with how we manage the performance of our existing contracts. This is an area where we see significant upside. We have many strong well-performing sites for sure, but performance is not always consistent enough across the group. Over the past months, we have systematically reviewed our portfolio. We identified a targeted set of contracts with significant gross profit recovery potential.

For each of them, we start with the same questions. Why is this contract not performing? Is it an operational execution issue? Has the scope evolved? Is pricing still aligned with today's reality or have the client needs fundamentally changed? The answer determines the action plans. That may involve improving operational execution, simplifying staffing models and increasing workforce productivity or adjusting pricing and scope where appropriate.

What is changing is that this is now managed much more systematically. Every region has identified the priority contracts and committed to clear recovery objectives by fiscal 2027. We've also dedicated recovery teams working on the most critical situations, bringing together some of our strongest operational leaders to accelerate improvement. And we are, in parallel, putting in place one common methodology across the group with shared performance scorecards, systematic tracking of operational leakage and common recovery playbook.

Our objective goes well beyond fixing today's underperforming contract. Every recovery program is also an opportunity to improve the way we operate. The lesson we learned are being translated into new delivery standards, simpler operating models and best practices that can be deployed across the wider organization. This is hard work. It is highly operational, but it's also where a significant amount of value sits, and it's largely under our control.

The second area is simplifying the way we operate. If we want better performance to become repeatable, we also need a simpler, more productive organization. Before going into what we are changing, it's important to understand why our organization lost competitiveness in some area. The answer is quite simple. It is the shape of our workforce pyramid. Over time, in different parts of the group, the pyramid has become unbalanced. Why? Because when you don't grow, you don't bring enough new talent at the base of the organization. At the same time, people stay longer in their roles and salaries continue to increase.

So what happens is simple. The base of the pyramid becomes too narrow, the middle and the top of the pyramid become too heavy and overall productivity deteriorates. And beyond productivity, it also limits our ability to refresh skills, bring in new talent and develop the next generation of leaders. So that is the situation we are fixing.

First, we are simplifying support functions and overheads. We are accelerating the expansion of our global business services, standardizing processes, removing duplication across the organizations. Our mindset is simple. Business services by default, unless there is a clear business reason for them to remain based in HQs. The role of our support functions is to enable the business, not to add complexity. We want leaner headquarters, stronger shared capabilities and more resources focused on serving our operations and our clients.

Second, we are flattening the organization. Today, we have the number of management layers very significantly across the group. In some countries, though, there can be as many as 12 layers between the site and the regional CEO. In others, there are 7. So that gap tells us there is considerable room for simplification. Every additional layer slows decision-making, weakens accountability and at the end, creates distance from the client. So we are, therefore, reducing management layers, increasing spans of control and moving resources closer to the front line. Pierre Bellon often reminded that this is a penny business. We need to operate accordingly with a lean organization, empowered local teams and support function that exists to help the business succeed and not the other way around.

Third, we are improving workforce productivity. Labor represents roughly half of our cost base. That makes workforce productivity one of the most powerful performance levers we have. But historically, we have not managed workforce productivity consistently enough across the group. Simple indicators such as workforce utilization or revenue per employee were not even measured and therefore, could not be acted upon. Managers also need much better visibility. Today, in too many situations, they simply do not have real-time information on workforce allocation, on labor productivity or operational performance. So that is why we are introducing common KPIs, much better operational visibility and stronger discipline around workforce planning and resource deployment. Taken together, these initiatives create a simpler organization, a healthier cost structure and a much more scalable operating model. As we execute this agenda, we expect these operational improvements to translate into improvements to meaningful productivity gains and stronger profitability over time.

The final part of this pillar is procurement. Historically, we did not always leverage our scale as effectively as we could. We are now building a much more integrated procurement model with greater standardization, stronger purchasing discipline and much better use of our collective buying power. This is already delivering tangible results, but we believe the opportunity remains significant.

Damien, who leads Entegra and supply, will take you through it. The model he and his team are implementing is one of the clearest example of how we can convert our scale into better competitiveness and stronger returns.

Damien, over to you.

Thank you, Thierry. Hello, everyone. Over the years, we have built a powerful supply ecosystem. We have scale in purchasing with around EUR 7 billion of spend across the client sites where Sodexo operates. We also have deep operational and culinary expertise. And we have Entegra, a leading and fast-growing group purchasing organization, GPO, aggregating over EUR 38 billion third-party member spend.

We have all the right assets. However, we have not been capturing their full value consistently. Why? Because our operating model was fragmented in two ways. First, many operational and purchasing decisions were made independently at site level. Second, our supply organization in Entegra have operated as two separate organizations under separate leadership. Our site level decision-making brought flexibility, proximity to local markets and strong entrepreneurial execution. However, when offers are designed locally, when ingredients vary across sites and when purchasing decisions are fragmented, over time, scale gets diluted. In practice, this translates into inconsistent buying leverage, limited compliance and variability in execution. And what we are doing is fundamentally solving for that. It is a full reset of our operating model.

We are changing the way the model operates day-to-day to connect brands and offers, menus, recipes, ingredients, purchasing decisions and execution at unit level. Our units do not start from a blank page anymore. Menus, recipes and ingredient choices become much more prescribed and structured. And that simplifies execution at site level, improves purchasing consistency and makes scale easier to leverage.

Today, in many units, planning, forecasting and ordering can take up to two or three days per month. This is a real operational burden that is now being reduced to a couple of hours. And that really matters because in a business like ours, reducing operational complexity directly improves execution quality.

In parallel, we are creating a model that is AI native by design, and AI will help us automate, allowing us to move from reactive operations to more predictive and consistent execution. The results are better economics, better execution and better experience for both clients and consumers. This consistently will allow us to better leverage our scale, but that's only the first part of the equation.

The second part is how we organize Sodexo Supply and Entegra. The reality is that we will -- we still operate as separate teams in most of our countries. In Europe, the Entegra business grew through bolt-on acquisitions with separate supply chain. The integration work country by country has not yet been completed. And in North America, until recently, we had separate leadership teams and different ways of working. And as a result, we were not fully leveraging the combined scale, expertise and capabilities.

Today, we are starting to work as one team with joint category strategies, increasingly integrated ways of working. Honestly, we've wrestled with this topic for years. On the one hand, we've been successful at growing our Entegra business, focused on external members, and that strategy worked. Entegra has consistently grown faster than the market and has built leading capabilities in procurement, data and digital. On the other hand, however, we were not fully capturing the value of our overall scale. Today, that opportunity has shifted. As we deploy our operating model, it provides the operational discipline that is required to leverage our scale. That is why bringing Sodexo Supply and Entegra together is the right decision.

This creates value in two ways: First, efficiency. By combining internal and external purchasing volumes, we are strengthening our buying power, strengthening our supplier relationships, increasing compliance and improving purchasing discipline across the system. Second, growth. As David just mentioned, procurement is becoming part of why we win contracts. Supply and Entegra are now involved much earlier in the sales process, helping us build more competitive client solutions, accelerate mobilization and create value from day one.

On several recent contracts, Entegra was live within weeks of the contract award, well ahead of the broader organizational mobilization. And that's a good example of how supply can become a commercial differentiator, helping us accelerate value delivery and strengthening client confidence from day one. This is also why we continue to invest in Entegra. Entegra has grown double digits consistently over the past five years, and we want to further accelerate. We will continue to invest in sales capabilities, identify bolt-on M&A opportunities and continue our geographic expansion. Everything that I have described started in North America, where we chose to build, test and refine the model before scaling it.

So what have we done already? Well, we brought supply and Entegra under one leadership to test and learn the model. We've rolled out order guides on some of our largest categories such as produce and bakery across our entire portfolio of units, and that's all 8,000 of them. We have deployed our new planogram technology to monitor our retail operations across all major units. And we've aligned general managers' incentives to include KPIs on supply chain compliance, essentially buying the right products from the right suppliers.

We're still at an early stage in the journey, but we are confident in the opportunity ahead. Sebastien will come back on the financial implications and explain how procurement, supply chain efficiencies and the broader operating model transformation will contribute to the margin improvement potential embedded in our plan.

As you can see on the slide, we have already started the rollout. Today, every North American unit is already benefiting from parts of the new operating model. And the early results are encouraging with north of 50 basis points of gross profit uplift on our pilot sites. And the next phase is about bringing all of those building blocks together end-to-end. And as our ERP platform is deployed, it will enable us to accelerate the rollout and scale the model across North America.

So let me leave you with three messages. First, we are fundamentally simplifying and standardizing our supply and operational model. Second, we have brought together supply and Entegra under one leadership to better leverage our scale and capabilities. And finally, with Entegra's aggressive growth plan, we are turning one of Sodexo's strongest assets, our supply chain and procurement capabilities into a source of competitive advantage, growth and value creation.

With that, Thierry, back to you.

Thank you, Damien. So over the next few years, we'll track our execution progress to continuously simplify and standardize our operating model. The productivity gains will show in our margins and also be reinvested to strengthen our commercial competitiveness. But organizations and processes are only part of the picture. Ultimately, sustainable performance depends on people, how we lead, how we manage performance and how we build the right culture.

So that brings me to our third pillar, building a stronger performance culture. Culture is what determines how decisions are made, how quickly we act, how leaders behave and how people are held accountable for results. In other words, culture determines how the organization performs every day. And frankly, over time, we lost some of that intensity. We became too complacent in parts of the organization, too slow to make decisions, to tolerant of underperformance, too reluctant to make difficult decisions. That has started to change.

For me, it starts with leadership. If we expect the organization to move faster, make better decisions and execute with more discipline, that has to start at the top. This is why one of my first decision was to reshape our leadership model. At group level, we simplified the execution committee and removed the zone layer. Today, all regional CEOs report directly to me. The objective was simple. Again, shorten decision path, strengthen accountability and bring leadership much closer to our clients and our operations. As an example, a EUR 100 million account does not need four layers of management around it. We've also strengthened leadership where we believed new capabilities were needed.

As a matter of example, North America alone, we have made 15 changes, 15 across the senior leadership team over the past nine months, including 10 external hires. But we also continue to strengthen the group leadership team, including with the recent appointment of our new Chief Human Resource Officer. The second element is performance management. People perform better when expectations are clear, when performance is measured consistently and accountability is not open to interpretation. This is about fewer KPIs, clearer expectations and much more rigorous follow-through.

The third element is incentive. We've simplified and harmonized our incentive framework across the group around one simple principle. People should be rewarded for the value they create. Growth carries now much more -- much greater weight than before, for sure, so do client execution and accountability, client retention, incredibly key. We've also aligned incentives much more closely with individual responsibilities. Hunters are rewarded for winning new business. Account managers are rewarded for growing and retaining their accounts. Operational leaders are rewarded for delivering growth and profitability. In other words, incentives are now directly aligned with the outcomes that matter most for our clients and for Sodexo.

Building a high-performance culture means continuing to attract, develop and retain great people. It also requires a much more proactive approach to talent management, identifying high potential individuals, accelerating their development and creating the right opportunities for them to grow. But we also want to bring in more talent from the industry. And by the way, let me tell you, we are seeing this happening with more and more talent reaching out and willing to join. They certainly want to help drive the transformation and leave Mark. And as a matter of fact, this is probably one of the most exciting moment to join Sodexo.

Now to bring this to life, let me hand over to Soorya. Soorya, over the past seven years, has led the transformation of APAC's performance culture and management system. A few months ago, I appointed her as SVP, Talent and Development to help embed these practices across the group.

Soorya, over to you.

Thank you, Thierry. Thank you. So let me share my personal journey with Sodexo. So when I joined APAC region seven years ago, I didn't find an organization lacking talented people. We actually had talented people. What we lacked was a consistent management system. And let me explain. Because of the way we have actually organized ourselves, decision often had to travel many organization layers before they were made. And the results, slower decisions and diluted accountability. And performance bank different things depending on who you actually ask. And along the way, we had actually become a little too sympathetic. What we were doing is that we were discussing and defending underperformance rather than acting or addressing it.

So let me share one statistics globally last year, right? Last fiscal year, 96% of our senior leaders were rated fully achieved or exceed expectations. In fact, more than 50% actually was rated exceed expectations, yet we fall short on our financial ambitions. And that doesn't add up. We weren't differentiating performance. We were actually normalizing performance. And that's why I described our starting point in just three words: complexity, inconsistency and complacency. Now performance rarely collapse overnight. It actually dreams. And so is our culture. Culture works exactly the same way. It's shaped by what our leaders reinforce, recognizes and what they choose to tolerate and not to tolerate.

So once we understood the problem, the question become obvious in APAC region then. How do you build a sustainable performance? Sustainable performance doesn't happen by chance. It comes from a management system that actually creates clarity, accountability and consistent execution. And sustainable performance requires both the what and the how. Neither alone is called sustainable performance. Now if you reward what without the how, you are actually promoting toxicity. People may hit their numbers, but at the expense of teams, collaboration, succession and so on, right? And on the other hand, if you reward the how without the what, you actually promote mediocrity. Great intention without delivery doesn't create any value.

So that's why we built our approach in three simple principles. First, clearer standards because people cannot be hold accountable if they don't understand what is actually expected of them. So we made success explicit. For example, every managing director in the region knows exactly what success looks like and how they will be assessed, and they know exactly where they stood throughout the year. Number two, fair assessment. Performance should never depend on who your manager is, right? So we moved from opinion-based to evidence-based assessments. And finally, stronger accountability. We reward outcomes and we recognize behaviors. That's our philosophy. We stopped recycling underperformance.

Obviously, we addressed them, right? We supported them. Some people improve, some move to a smaller role and where there could be -- there couldn't be any improvement, we actually had to make a very difficult decision. And managing low performers actually requires a very different leadership mindset. It requires empathy and not sympathy, right? Sympathy removes accountability from individuals, but empathy actually supports people to succeed.

So, looking back, everything comes down to one simple belief, performance should never be open for interpretation. So did it work? The answer is on this slide. So let me show you why. So if you look on the right, the revenue grew. Gross profit improved. Underlying operating profit increased significantly. Now those results did not come from one initiative. They came from a business that was actually executing with greater discipline, rigor and consistency. And now look at your left. Engagement among our senior leaders increased from 79% to 89%. Leadership advocacy reached 64%, placing us firmly in the best-in-class benchmark and regrettable attrition also reduced.

So the important point isn't that one metric improve, they all actually move together. And that's exactly what you would expect from a stronger management system. Now raising performance standards actually strengthen engagement. So now having demonstrated that in APAC, the next question becomes obvious, can we leverage it? Can we strengthen it? Can we scale it across Sodexo? And now that's exactly what this slide is about. And one important point, these are not future ideas. They're actually being implemented as we speak. Together, they are actually creating one integrated performance management model across Sodexo.

Now first, we are creating much clearer expectations through what and how assessment, day one target cascade. And it's not like day month four, right, that people actually is getting their targets. But day one target cascade, simplified bonus KPIs. Every employee will understand what success will look like from the beginning of the year and how their performance will actually be assessed. Second, we are strengthening accountability. High performance will be recognized more clearly and sustained underperformance will be addressed earlier and more consistently. So we will no longer recycle underperformance. Third, we are improving differentiation, differentiated rewards and evidence-based assessment ensure performance is actually recognized fairly and consistently across the organization. And finally, as Thierry has actually mentioned, we are building a stronger leadership pipeline through critical roles identification, refreshed leadership population framework, we are investing in roles that have greatest impact in today's performance and tomorrow's growth.

So here's our ambition by fiscal year 2030. senior leader engagement above 85%, regrettable attrition below 18% and ready now successor for at least 80% of our top 250 critical roles. Now this isn't a collection of HR initiative. It's one enterprise management ecosystem that is changing the way Sodexo is managed.

So let me finish with this. What we are doing is a permanent change. If we get this right, the organization will move faster, leadership will become stronger. And when standards are high and applied fairly, engagement will follow. We proved it in APAC. And now we, as a Sodexo's leadership team are taking this experience, strengthening it and embedding it across Sodexo because ultimately, performance is not an annual event. It's how we choose to lead every single day.

With that, thank you. Over to you, Thierry.

Yes. Thank you. Thank you. What you've just heard is a management system designed to strengthen execution across the group. It's about restoring a culture with clear executions, stronger accountability. and better leadership at every level of the organization. As with every pillar in our plan, we have defined a clear set of indicators to track our own execution. We'll monitor our ability to attract and retain our best talent through engagement and citable attrition. We will also monitor the effectiveness of our performance management through performance rating distribution. And finally, we will monitor the strength of our leadership pipeline through succession coverage. People are at the heart of our business, right? Our success will always depend on the quality of our leaders, the strength of our teams and how well we identify, develop and retain talent over time. That is what will make the difference.

But the next question is, how do we enable our people to perform at their very best every day. Many operational improvements can already happen through better leadership, simpler processes, stronger execution discipline, but technology and data allows us to scale those improvements much more effectively across the organization. Our investments in technology and data are about both catching up and pulling ahead, fixing today's gap while building the capabilities that will differentiate us in the future.

Today, let's be clear, we still have technology limitations that a company of our size should not have. Over the years, the organization has allowed for the creation of many local solutions. This has resulted in a landscape of fragmented system that often do not talk to each other that has prevented us from having a relevant operational data. In some instances, we still don't have the most simple operational performance management tools. This prevents us managing performance rigorously.

So the first priority is clear, fix the foundations, once and for good. That starts with much tighter governance. So today, it's very simple. All the tech teams around the world are reporting directly to Alice so that we make sure we have one unique governance model, one shared technology road map and in the end, much stronger discipline around investment decisions. That allows us to accelerate the implementation of core systems, ERP, HR, procurement systems and build a common data foundation across the group. Reliable, real-time data allows managers to make better decisions, act earlier and execute much more consistently. With integrated systems, managers can deploy resources more effectively, improve productivity and manage the cost base much more dynamically. Now once those foundations are in place, we can scale much faster.

Our second priority is to scale digital and AI much more aggressively across the business using AI and digital tools to improve commercial performance, simplify operations and increase productivity. So technology is becoming an increasingly important differentiator for our clients as well, particularly large clients. We expect greater transparency, operational visibility and frankly, data-driven insights.

So today, we have the governance, we have the fundings and the foundations to scale these capabilities across the group. Alice is leading the transformation. Alice, over to you. Thank you.

I have the tech person in the team. I have two messages for you. First, our tech was fully fragmented in the past. And trust me, it was a nightmare. Second, we are fixing it. Historically, at Sodexo, technology was developed locally in a federated organization. As an example, we invested in hundreds of digital AI solutions. At some point, we were managing 2,000 systems.

We are working in two ways to address this. First, we are operating a big lift in our foundations. Enterprise solutions are one, finance, food, FM supply and data is the second. And here, we are making an urgent investment. This will represent more than 50% of our tech investment. And the advantage to do it now is that we are making it data-centric and AI native. As an example, we have designed a new ERP, including AI to automate menus, optimize supply, predict production in collaboration with Damien. Second, we have created a unified digital and AI platform to integrate all our solutions into one. In the next quarters, the objective is to deploy this AI native platform in our 27,000 sites.

Let's deep dive here. All our digital and AI products are now integrated into one consistent platform, Sodexo Spark. Sodexo Spark is modular like LEGO box. It combines standardized modules that can be assembled to meet the different needs of clients, consumers or operators.

Let me start with clients. We call it Spark IQ. Spark IQ provides transparency and insights. It combines operational consumer asset modules to help clients make better decisions in food services and FM, such as energy and space optimization. This is now a strong competitive advantage to win large deals. In FM, Spark IQ leverages IoT to move from reactive maintenance to predictive and demand-based maintenance with now more than 5,000 sensors deployed in six countries. We are now able to adjust cleaning routines or hair cooling based on usage of rooms and offices. In food, Spark IQ is deployed across more than 1,500 sites and covers around 40 million transactions every year. It allows us to improve our services on cost in line with our client objectives.

The second component is Spark XP. Consumers increasingly expect personalized digital experiences and Spark XP deliver that. We are making every day simpler and more relevant for 10 million active consumers through digital ordering, frictionless retail, customer recommendation, workplace services. As an example, frictionless stores are particularly adapted into stadium and mining context. In the site where it is deployed, Spark XP generates an increase of 15% spend per consumer basket as an average. Beyond the metrics, Spark XP strengthens consumer satisfaction. For our clients, that means better experience in their facilities. For Sodexo, it creates additional growth and stronger consumer loyalty.

The third component is Spark OS. It is designed for our operational teams. So they spend less time on administrative tasks and more time serving consumers and clients. Spark OS supports workforce planning, menu creation, procurement, asset management and improve productivity across both food and FM, thanks to data and AI. Today, Sparks OS supports 6,000 operators every day. In 2030, all our site managers will work daily with Spark OS.

I now invite you to watch the video that summarize everything.

[Presentation]

So what's next? We have started the deployment of the ERP, and it will be live next year in pilot countries, along with FM and HR solutions. We expect full deployment of enterprise core systems and Sodexo Spark towards 2029 and 2030 on all our sites.

And to conclude, let me remind me my two key messages. First, we are leaving behind a fragmented tech ecosystem. Second, we are fixing the system by leveraging data and AI, and we are fixing it very fast. There is no doubt in my mind that we are delivering the most efficient tech platform for us that will nurture our growth for a long time.

Back to you, Thierry.

Thank you, Alice. So what Alice has shown is that technology plays two very different role in our transformation. First, we are fixing the foundations. Our ambition here is straightforward to have core systems and data that are reliable, integrated and fit for a company of our scale. We're not trying to build the most sophisticated ERP landscape. We are building one that works, okay? Second, we are using digital and AI to differentiate ourselves in the market, improving productivity, strengthening our value proposition and creating a better experience for our clients and our teams. So they doing both requires significant investment. Over the next three years, we will continue to optimize our business as usual technology spend, right, while materially increasing investment in transformation. Sebastien will come back to this in more detail when he discusses our capital allocation and financial framework.

As with every execution pillar, we have here also a clear dashboard to track our progress. We will monitor the deployment of our core platforms, the quality and the availability of our data, the adoption of Sodexo Spark and ultimately, the productivity, the growth and the client value these capabilities generate. Some of these benefits are already visible today. As we scale these capabilities across the group, technology will become an increasingly important source of competitiveness and differentiation.

Everything you have seen and heard today is designed to achieve the core objective, accelerate growth and restore competitiveness. We also have a dedicated team and scorecard to monitor execution, measure progress and hold ourselves accountable for delivery.

Now I'm sure you're with me. The next question is how this translates into financial performance. So Sebastien will now take you through the financial trajectory we believe this plan can deliver. Sebastien, over to you.

Thank you, Thierry. So most of what you have heard this afternoon has been about improving execution. I will now explain how better execution translates into financial outcomes. And let me start with what I believe is a key question. What gives investors confidence that this plan will deliver. And when I look at the transformation plan, I ask myself two questions. First, do we clearly understand what went wrong? Second, have we translated this assessment into concrete action. And I believe that we can answer yes to both.

Growth is being rebuilt with stronger commercial capabilities, proactive account management, disciplined price to win competitiveness and a much more structured approach to large clients. Our competitiveness is addressed with operational excellence, workforce productivity, organizational simplification and supply at scale. Technology is improving the way we serve clients, we operate the business and make better decisions. This is no longer simply a list of priorities. It is a coordinated set of operating changes, management decisions and investment that directly address what was not working. Having seen the organization over many years, I can tell you that it has changed significantly over the past months. I see greater urgency, faster execution and a much stronger focus on client.

Let me now address another important point. I want to ensure that we grow both profitably and sustainably. We are changing our commercial approach. We will be much more competitive where we want to win. But being more competitive, it doesn't mean compromising our financial discipline. Every significant investment, major contract continue to go through a rigorous financial and contractual review, clear return criteria and a disciplined governance. Our objective is obviously not growth at any cost. It is profitable growth supported by a more competitive cost base and better execution. And this is something I look at personally.

Now let me explain how we think about growth. Our organic growth comes from three drivers: pricing, volumes and net new business. So let me start with pricing. Here, pricing refers to inflation-related price adjustment on existing contracts. It is different from the pricing strategy we described earlier, which is reflected in the net new performance. On pricing, our objective is clear: pass through inflation, protect margins and remain competitive. This requires discipline in our contractual terms in the day-to-day contract management and in our pricing discussions. But we also benefit from structural advantages. that help us manage inflation. Our internal inflation is typically lower than the market because of our scale, because of our purchasing power, our ability to adapt ingredients and menus. Over time, pricing broadly reflects our cost inflation. We are assuming around 2% per year in the midterm, but this will depend on the macro environment.

Second, volumes. Volumes reflect the level of activity we have on our existing sites. Part of it depends on the macro environment as well. But we also have clear levers to influence volumes, enhancing our consumer offer, leveraging tech and data to drive participation in retail sales and growing existing accounts through a more proactive cross-selling approach. Overall, we view volumes as a relatively stable contributor between 0% and 1% per year across the cycle.

Third is the impact of the net new business, and this is a key driver. Today, our net new business is broadly around breakeven. Our objective is to turn it positive in the near term and then progressively increase it over time. Our ambition is for net new to contribute more than 3% to organic growth by fiscal 2030. And taken together, that supports our trajectory towards above 5% organic growth by fiscal 2030.

Now if we look specifically at fiscal '27, our guidance reflects the early stages of that progression. We expect pricing to contribute at least 2%, again, broadly in line with inflation. We expect volume to grow broadly -- to remain broadly stable. And more importantly, we expect net new business to turn positive, although still at the early stage. And taken together, this supports our fiscal '27 organic growth guidance between 2% and 3%.

Now before presenting our margin trajectory, I would like to spend a moment on the investment behind Shift & Grow. It explains both the near-term pressure on margin and the long-term value creation opportunity. Across fiscal '26 to fiscal 2030, we are concentrating our investment in four areas. First, commercial capability to accelerate growth. We are significantly strengthening our sales organization through additional sales and account management resources. Once fully deployed, this investment will represent around EUR 100 million of incremental annualized operating cost. Winning and retaining more contracts also means investing alongside our clients. As a result, we expect capital expenditure to increase to our 2.5% to 3% of revenues across the cycle. And it will be driven mainly by contract-related investment at client sites and to a lesser extent, by technology.

The remaining investments are different in nature. They are designed to transform the way we operate and strengthen the business over the long term. Across technology and data, workforce transformation and supply, we expect to invest approximately EUR 1 billion in nonrecurring incremental initiatives over the course of the plan.

And let me briefly explain where those investments will go. First, tech and data, as Alice described earlier, we already invest around EUR 500 million in technology each year. And over the plan, we will continue to optimize this business as usual spend while adding around EUR 500 million to EUR 600 million of incremental transformation investment. These investments are a critical enabler of productivity, scalability and better decision-making across the group. Second, workforce transformation. And this is the largest margin improvement opportunity within our plan. We have already started this transformation. And over the next 12 to 18 months, we will continue to simplify the organization, further expand global business services and improve workforce productivity across our sites.

To support this transformation, we currently expect restructuring costs of around EUR 400 million across fiscal year '26 and '27. This cost will be reported below underlying operating profit within other income and expenses. And the recurring productivity benefit is expected to broadly offset that restructuring investment over time. And third, supply, as presented by Damien, where we are standardizing processes, strengthening supply capabilities and scaling our operating model across regions. Once fully deployed, these initiatives are expected to contribute more than 50 basis points of margin improvement.

Key point to keep in mind is the timing. Fiscal '26 and '27 are investment years. From fiscal year '28 onwards, we expect to benefit increasingly from the return of those investments. And this is exactly what is reflected in the margin bridge on the next slide.

So before I walk you through the bridge, let me start with fiscal '26 as it is a financial starting point of the plan. The 3.2% to 3.4% guidance reflects operational challenges, additional investment and the impact of the asset and contract review. Fiscal '26 represents the low point of the plan. It is a deliberate reset that establishes a clean starting point for the years ahead.

First phase of the plan is about rebuilding competitiveness. Fiscal '27 is a year of transformation than a year of margin recovery. We first benefit from the nonrecurring of several negative items that impacted fiscal year '26. At the same time, we continue to invest in commercial capabilities, in tech, in supply. And the final bucket combines several offsetting effects. We begin to capture the first benefit from shift and growth through supply, organizational simplification, workforce productivity. However, those benefits remain only partial at this stage and are offset by the initial impact of our more competitive pricing approach and the normal ramp-up of new contracts. So as a result, we expect underlying operating margin to remain broadly in line with fiscal '26.

From fiscal '28 onwards, we enter the acceleration phase. By then, the transformation is largely deployed, while the investment made during the first phase begin to generate recurring benefits. The first driver is supply. We expect structural improvements in margin as we deploy our new operating model, increase purchasing compliance and leverage our scale more effectively. The second and the largest driver is the workforce transformation. We expect meaningful productivity gains and structurally more efficient cost base as we simplify the organization and improve workforce productivity. And the third bucket combines several offsetting effects. We naturally benefit from positive operating leverage as growth accelerates. At the same time, part of the productivity gains generated by the plan are deliberately reinvesting to strengthen our commercial competitiveness. And we also benefit from the normalization of the investment made earlier in the plan. And taken together, these drivers support a progressive improvement in profitability, leading to an underlying operating margin of more than 5% by fiscal 2030.

You can see our capital allocation framework on the slide, articulated around three priorities. First, investment in the business. We'll continue investing in commercial capabilities, in tech, data, in competitiveness. We will also expect capital expenditure to increase to our 2.5% to 3% of revenue across the cycle, as I mentioned before. Second, dividends. Our policy remains unchanged with a 50% payout ratio of the underlying net income. And we believe that this is the right balance, sharing value creation with shareholders while preserving the capacity to invest in the business. Third, M&A. Our approach remains targeted and disciplined, focused on bolt-on acquisition. Every investment case will strengthen our capabilities or reinforce our position in priority markets. And it is expected to deliver a return on capital employed of above 15%.

As we move through this investment phase, leverage is expected to increase to around 2.6x in fiscal '26 and to remain between 2.6x and 2.8x in fiscal '27. And this reflects front-loaded investment and temporarily lower profitability. But our business remains resilient, cash generative, capital-light and our medium-term objective remains unchanged to return below 2x leverage by 2030.

As growth accelerates, margins improve and investments mature, we expect a sequential improvement of the return on capital employed along the plan. And this is supported by a disciplined approach to liquidity management, combining significant liquidity sources and a proactive management of debt maturities. We have already repaid the maturity that came due in April and June '26 and the EUR 800 million April 2027 bond will be refinanced in due course. We are committed to remaining a solid investment grade.

And let me conclude by bringing everything together with our midterm financial guidance, which represents our commitment to investor. You saw this trajectory earlier with Thierry. What I wanted to explain today is how it is built. stronger growth supported by a strengthened commercial engine, progressive margin improvement driven by labor productivity, supply and simplification and improving returns supported by disciplined capital allocation. These are not stand-alone financial targets. They are the direct consequence of the operational choices and investment we have discussed today. At the end of the day, our plan will be judged by one thing, execution.

Today, our objective is not simply to set out an ambition plan. Our objective is to continue demonstrating that we can deliver quarter after quarter on the commitments we make. That is how we intend to build confidence over time.

Thank you, and back to you, Thierry.

Sebastien, thank you. All right. Let me close with one final thought. What we presented today is a focused turnaround built on actions that are already underway, a plan that converts operational improvements into stronger growth, higher margins and greater cash generation over time. We believe Sodexo has everything it takes to create significant value over the long term. We operate in attractive and resilient markets. We have leading position in food and facilities management. We have long-standing client relationships. We have a unique combination of global footprint of capabilities and talent, and we have established leadership in sustainability and positive impact. Together, these strengths increasingly differentiate us from -- with clients.

Today, we also have a clear strategy, a disciplined execution plan and importantly, a renewed leadership team fully aligned behind the plan. Together, these strengths provide a strong foundation for sustainable value creation.

Transformation takes time. We know there is still a great deal of work ahead of us. But what gives me confidence is what I see happening across the organization. Leaders are taking ownership. Decisions are moving faster. Commercial intensity is back and teams are fully focused on clients, execution and performance. So these are early signs. They are the signs of an organization that is changing, gaining momentum and on the move in the right direction.

Pierre Bellon has built this company around a simple idea, serving clients well, developing our people, fostering entrepreneurship and putting growth and positive impact at the center of everything we do. That is what Shift & Grow is about, returning to the fundamentals that have made Sodexo successful for decades. Turnarounds are not built on promises. They are built on execution. That execution has started. We look forward to showing you our progress over the years ahead. But again, for today, thank you for joining us.

I'll invite now all the speakers to join me on stage for the Q&A session, okay?

Thank you. We will now open the floor for questions. [Operator Instructions]

Almost ready. All right. How do we do that? Should we go ahead? You're #1? We can get closer, but we're not hearing.

Jamie Rollo from Morgan Stanley. Two questions on the margin, please. It's clearly a pretty big increase from the sort of low 3% next year to 5%. Should we assume a sort of fairly even cadence of sort of 50 basis points over those 3 years? Or would it be more sort of back-end weighted, do you think? And then secondly, again...

Nothing related with [indiscernible], you blew up the mic.

On the margin bridge, the 100 basis points from workforce productivity, you said that's nothing to do with operating leverage on the new wins. Obviously, you're not looking for higher volume growth. So can we infer that is simply a reduction in labor costs. So you must be looking to, I assume, have fewer people or to reduce your labor costs over time. I didn't sort of see that mentioned explicitly in the presentation. So maybe I misunderstood that.

So just maybe a word on the first question and then the second one, I'll -- Sebastien will elaborate. That's for sure that if the objective is to look at FY '27 as a period where we are intensifying the investments that's the reason for I think the margin where we see it by '27. For '28, then certainly, it has to pick up. We know that over the 3 years to get to 5% will require more or less the same level of jump every year, right?

It's a good assumption. I mean you can take really a linear improvement from '27 to 2028. And then on the labor productivity. So as I said, mostly of the investment, I mentioned the EUR 400 million investment on labor productivity, fiscal year '26, fiscal year '27 will be booked below [ UP ] in OIE. The cash out will be in '26, '27 and '28. I mean, as you know, there is a lag between booking the provision and the cash out. So we'll get the benefit from that, again, and we started already to have some benefit from that this year. It will be progressive '27, then '28 and then '29, okay?

And then as I explained, we get definitely this margin improvement, and then we reinvest part of it in terms of pricing, our pricing strategy, okay? So this is not fully -- it doesn't flow doesn't flow directly in terms of margin. Part of it, obviously, it's [ kept ] But then you have also part of it that is reinvesting in growth.

Simon LeChipre from Jefferies. First of all, on business development and I mean, net new, what are the KPIs you are monitoring to sort of control the quality of the contracts, which are retained and signed? And are these KPIs part of the incentive framework for sales? Secondly, what is the current mix in terms of commercial development between first-time outsourcing and share gains? And how do you see this evolving as net new accelerate? And lastly, as a follow-up on margins. Basically, you expect operating leverage to pick up from '28, but it should also likely be the period where the growth momentum also accelerate. And we have seen in the industry that growth acceleration usually comes with some dilutive impact with start-up costs with a ramp-up period. So basically, how can we reconcile this growth acceleration while basically bringing margin above the prior peak at more than 5%?

So the first point is about, I guess, the retention, right? You're wondering what do we -- what are the KPIs to track the progression on retention. So we -- David, do you want to take that one?

Yes. So what we look at is we look at renewal conversion rates as well as proactive renewals. I think your question is more along the lines of the quality of the contract and making sure that the pricing to win doesn't impact negatively those. So what we do when we look at price, we look at both value creation and the cost to the client. So it's a dual equation. We try to increase the value that we're doing while not necessarily having to reduce the cost too much to get to the price to win. We also, as Sebastien mentioned, have financial discipline around these contracts where we're still going through a pretty detailed review process. We are making specific strategic choices to invest while simultaneously maintaining the portfolio mix and making sure we're not impacting the margin overall.

Regarding your question number 2 about first-time outsourcer, I think what we are observing is that we have about 50% of our new wins that are FTOs. And we are seeing this continuing, right? So no major change here. If we look at first-time outsourcing, there's, for sure, the huge potential of just harvesting relationship with the client and hoping that the investment we're going to make in account management, will put us in a position to continue to grow this. But there's also a new opportunities for us to go after companies that have not outsourced yet and where we are actually gearing up for the -- at the moment to be ready to go with a specific strategy for going after these clients. And so that's going to be a new opportunity that we have not leveraged yet. On the point number three about the margin.

So maybe one comment I would make on the impact. And if I'm not covering it, you'll complete the question. It is clear that when you are going with a large deals, there's a possibility that in the first month, you have some transition costs and so on that are impacting your margins. And so that's why for me, the value of our strategy is to create repeatable success because that's the power of the portfolio to have several deals with a different level of maturity where at any moment in time, some are actually in transition time, while others are starting to pick up in terms of margin so that we can manage it. It becomes very difficult when it happens only once in a while and suddenly boom, you have something that really bring your margin down.

I want to mention one point, though, is that our conviction is that as you are growing large relationship, very, very significant volume business, right, with a client, you should have a different way at the margin. Do not look at the margin as gross profit level only. These accounts become almost P&L in themselves. And a lot of the cost of SG&A and so on are actually reflected in there because those accounts need to have their own structure supporting the account. So at the end of the day, between that and possibly a lower cost of sales, the level of margin on those deals is certainly not more dilutive than anything else.

I have 2 questions. The first one is whether you could tell us more about cash generation, which after all is a classic target to have in those medium-term plans. We can do some math with the leverage targets. We can do some math with the CapEx. But assuming we're not good at math, what sort of cash can this business generate while you turn it around? And then what can it generate once the bulk of the investments are behind you, please?

And then on the 160-plus contracts that you're reviewing, could you clarify if there's overlap with the contracts and asset review that you started earlier or if that's completely new? And if it's completely new, does it also start with a review with provisions? Or is that not the approach that you batch?

Okay. So I'll take the second one, and you'll come back on the cash. So it's -- so one, it's the follow-up of the step one, right? What we did 3 months ago was to really review our contract and make sure that we are -- we know where they stand in terms of profitability and that we have no hidden losses or situations where we would have to take provisions now, which is what we've done at the end of the first half. What we're doing going forward is we have a situation that is some accounts are highly profitable, some are less. And how do we work on those accounts.

By the way, sometimes some profitable can be even more profitable and some not profitable cannot be improved. But that's -- the purpose of the stream around our loss-making contract or low-margin contracts is to really use patterns that we are observing here and there to drive a more proactive actions on those projects to improve their margin. So it's -- you should not expect that from those activities, it will result into additional loss, which is what I might suspect you have in mind, but it's more really how to drive just margin improvement on these contracts, okay? On the cash.

And on the cash flow, we'll end fiscal '26 with a free cash flow around EUR 200 million, EUR 300 million is for this year. For next year, if we look at our free cash flow will remain positive and despite the different investments, okay?

Then keep in mind also that we have the refinancing of the bond that will mature in April '27, EUR 800 million. We will refinance that in due course. It will give us also the opportunity to raise a little bit more than EUR 800 million, okay, a couple of EUR 200 million, EUR 300 million. And this will support the cash need for fiscal year '27. And then fiscal year '28, cash conversion will be much better. So we go back to normal, I would say, normal cash conversion. And then we will finance the development of our plan with our own cash for '28, '29. Sorry?

[indiscernible]

You go back to a it and then free cash flow above 80%. So with this free cash flow coming from the business, you finance your basically the dividends.

Sabrina Blanc from Bernstein. I have 2 questions. The first one is regarding the data center opportunities that you have mentioned. Firstly, do you have a dedicated offer? Just to understand how it might be different from the usual remote offer that you have? And shall we analyze these opportunities as additional opportunities in terms of outsourcing? Or is it part of the normal outsourcing trend that we are expecting in this environment? And to finish, sorry, on the data center, do you estimate that only a few competitors would be able to provide this offer? Or will it be very competitive like a normal contract?

And my second question is, you have mentioned the facilities management. But just to understand how you if you would like to focus more on food or FM, we know already that we had stop and go on that point at Sodexo. So we would like to have things very clear on how FM has to be coordinated with food.

Okay. So I'll take this 2 -- point 2, on the data center, we'll come back right after. I want to be very clear. We are a leader in food and a leader in facility management. Period. We are looking at both markets as opportunities for us, and we are leveraging those capabilities and solutions to serve our clients based on their needs. If you remember in the deck, we showed at some point in time some pattern. We know that they have every different industry follows some specific patterns. They are buying differently. And so we are adapting our sales strategy to it. We know that if we go in, say, in the technology space, we will tend to -- they will tend to buy food experts.

And therefore, that's what we will do. If you go in some other industries, they will want to buy IFM services. So those patterns are driving the way we are going after those markets. But again, no ambiguity. We are a leader in food and in facilities management. On data center, yes, of course, we have a specific offer for data centers. We are speaking to a lot of clients already. We are winning deals. Let's put things in context. The size of this market is not necessarily a enormous at the scale of our business, but the opportunity of growth at the moment is significant, okay? So I just want to frame a little bit the discussion here. Yes. David?

It's an attractive market. It's a growing market. We have assets, which is great. We have our remote site business, our village experience, which allows us to address that. We have the relationships with hyperscalers and in the market, and we also have a substantial business already in place in that business. So it's well done. I think one of the things about data centers, I'll just add is the complexity of the market. So treating it as if it's one particular thing, it's not a homogeneous market. You have to look at construction, you have to look at operations, you have to look at the hyperscalers and you have to look at the pieces of it. It's important to understand the complexity of the market as well.

This is Kate Xiao from Bank of America. My 2 questions. First one, congratulations on the Meta win. And I guess you guys mentioned how the large account pipeline is very important and it's improving. Obviously, over 3% net new target is an ambitious one and hasn't really been achieved for a long, long time. I guess my question is, what is behind that confidence of achieving that 3% net new? Is it because you're seeing a lot better pipeline? Are you seeing kind of deals being built in the pipeline? And if you do have that visibility over the next couple of years, does that mean you can achieve 3%, call it, 2% to 3% net new closer maybe by '28 rather than 30s? So that's the first question.

Second question just on, I guess, margin and how you price for contracts. You're pricing to win, you're pricing not just on the cost base anymore, but compared to the market. Obviously, that implies -- and as you guys are talking about adjusting your cost base, but that's given where Sodexo is, is an evolving journey, you're achieving probably your ideal cost base by 2030. Does that mean you're pricing some of your contracts to be reasonably profit by 2030 and probably less so now?

Okay. So on the first one, the net new, okay? It's your question about what makes us confident. The starting point, as surprisingly as it may sound, growth was not such a priority. So that's a big change. And what we are seeing in the field is that our teams are responding to it, okay? But then once the intensity comes on going after new deals comes a question of competitiveness. If you have a competitiveness challenge and you're pricing your deal based on your cost base, that gets you priced noncompetitive, you end up not winning, right? So your revenue goes down, your competitiveness is deteriorating further, okay?

So we are changing the paradigm here. We are inverting the sequence. We are saying, first, go win this deal. Tell us what you need to win. And then you have to work on your competitiveness to deliver better margins. So that's why we believe that the growth engine will sequentially kick in and has started in a way. I'm convinced that a Meta deal was not a deal that we would have necessarily won before. And at the same time, the work on competitiveness, there's a lot of action going now, but it's an ongoing process. And I would even say more, it is becoming a routine for us. It's a muscle that we have not leveraged much or enough, okay? So that's on the net new. Can we do better? We are telling you what we feel we can do now with a very, very important obsession.

Let's not sell dreams. Let's be focused on the reality. And that's what we are doing really. The point number two on pricing, actually, I covered it a little bit in the first question as well. Yes, sometimes -- you have to take into account the fact that if you are only -- if you're not ignoring a little bit your cost issue, you will not be competitive. So you have to accept the fact that pricing is one thing. But then for sure, you cannot only just say, I've want to win and oh, guess what, it's a loss-making. It doesn't work. Okay. Please, if you have questions for the rest of my team as well. We have great leaders here.

Estelle Weingrod from JPMorgan. The first question I wanted to ask on data centers again. You mentioned the opportunity is not just about the construction phase. Can you give us more color on the opportunity for the operating phase and how it compares to the construction phase in terms of volumes? And also a question, you did reset expectations materially in April. What has changed since then that drove you to cut margins once more for next year? Is it related to some price investment that was not well budgeted initially?

So I'll take the second one. We have not cut margins. We have guided in April 3.2% to 3.4% for fiscal year '26, and we've said that would be the floor. That's what we said. So we haven't changed, okay? On the point number one, on data centers in operations, it's often as part of the relationship we are building with the hyperscalers or the large companies who are in needs of data centers. And oftentimes, it requires -- they want -- they need global players because they have a global strategy. And so that's how we are working with them. Gain?

Yes, I would just add that you have to look at construction and operation as recurring revenue and discrete revenue as well. So I think you have to look at the businesses differently and the operating revenue is a consistent revenue, whereas the construction even for the last year or 2 years is a discrete revenue. So it's a different type of base. The business is about 50-50 mix roughly between the operations and the construction revenue.

This is Leo Carrington from Citi. Firstly, on the Meta contract, just curious on the timing. It comes at a very early stage of the turnaround. What was it in particular that you think gave Meta the confidence to go with you for the long term despite the early stage?

Secondly, just going to the point about the large accounts the 15% of the market. Are you currently underweight or overweight those accounts? And would you like to presumably only grow more? Are they more attractive because of their size or because of other characteristics like retention? And then lastly, on technology and cost investment in technology, the EUR 500 million to EUR 600 million investment, why does that -- that's one-off? Why does that not flow back in outer years? What is it about that, that's one-off?

Okay. Meta, it's a long process, right? Slightly difficult to respond for Meta. But what I would say is for being in regular contact with the leaders of Meta, I would say they feel trust. Why? As from day 1, massive mobilization from the leadership team, high intensity with a significant team. One, teams full time on the ground working on the bid and getting the full support from the leadership team.

Second, the leadership team, I mean, 6, 7 leaders from the executive team involved every week, just tracking where we stand, how we are playing and not as I'm in the hierarchy, I'm in charge of something, right? Alice had a very key role to play on the technology standpoint. And having -- keep in mind, was in front of Meta. They saw our potential from a technology standpoint. There was a lot going on, on the HR side involving the HR team. We mobilized Sodexo Live!. We mobilized our team in America, in Asia. We had one Sodexo completely focused.

I can just share my own experience as well, right? We committed ourselves. We were engaged with the client, not 1 or 2, but a team. On one important day, we had as many as 7 members of the leadership team working on different aspects of the deal with the client, okay? So I think it's just that, one, no question about the quality of our offers. Second, we were competitive. We were incredibly committed. We've listened to them. We've heard them, and they know that we're going to take it very seriously. We will -- we are very proud of what we've won. But I think also if I reflect on that, it's an incredible blueprint for the way we should go at other large clients like this one. Your question about the large accounts, I hope I understood your question, is why large accounts? Because they have higher potential of growth, right? But also because we are in the business of building trust. Yes, we are providing food services. Yes, we are providing facility management services. At the end of the day, they work with us because we become one of them. We are part of their team. We are working inside their own ecosystem. The building trust is powerful and can drive a lot of growth. So for sure, we want to have more very large and giant and super giant accounts.

Just to add a little bit, we're a little underweight currently in the large accounts. Our conversion rates. So our pipeline is good. You were asking about the pipeline. Pipeline has been there, and it's there. We've made it hard to buy from us. We've made it complex and difficult to buy from us, which is the opportunity that we have to fix it. And that's also what gives us confidence is we know that we control the buying experience and we make it easier to buy from us. The pipeline is there, and we're a little bit underweight.

On the tech, from Sebastien and then from myself.

On your last question, so the incremental EUR 500 million to EUR 600 million OpEx and CapEx. First of all, we need to address the legacy. So more than half of it is really to fix really the foundation, all our ERP, supply, finance, our food platform and FM platform as well. So -- and then it's really the acceleration of our data, digital AI strategy. So I mean -- so this is really why we really need to invest those EUR 500 million to EUR 600 million as an incremental investment. And maybe Alice, you can give a bit more color.

So remember where we are coming from that I was describing, moving everything from the legacy fragmented to centralized system scaled across the globe. It requires a huge investment. And by the way, tech is at the heart of each persistent growth initiative. David can't work without tech. Daniel can't work without tech. So we are also enabling the initiative of persistent growth.

Johanna Jourdain from ODDO. Two questions for me, please. So on the ERP optimization, could you share with us the rollout that is expected? Is it a country-by-country rollout or segment-by-segment rollout? And when do you expect to tackle the big countries such as the U.S.? Then on retention, it was already a focus over the past few years. So just would like to understand what is changing this time? And what are you doing differently compared to what you did before?

Yes. So go ahead with -- do you want to take the ERP? So...

We have already started the deployment on ERP, and we are managing country per country, not per segment, except maybe for big regions such as NorAm, where we will have to manage within the region some segment per segment initiative. For the big ones, and you have mentioned U.S. by 2029, we expect to have fully deployed NorAm.

Thank you, Alice. On the retention, it goes back with what I was saying about the retention in the presentation that you're not retaining an account in the last 6 months, right? You're retaining it every single day. By the level of engagement in the account, the level of connection of understanding of the client, the level of proximity that you have built with and credibility you have built over time. And then your ability to constantly challenge yourself and bring new innovation. All of that, we are driving it ruthlessly in the field. It takes time. It's not changing overnight, but that's visible. We know that the best leaders in each of the segments managed to have better level of retention.

Andre Juillard, Deutsche Bank. Two questions, if I may. First one about segment. You didn't talk a lot about education and the different segments. Could you give us some more color about the trend you are registering and especially the education situation in the U.S.? Second question, if we look at the plan, it's a relatively long-term one with a very significant level of investment, very significant level of transformation. Who knows what can happen in terms of conflict, in terms of challenge, inflation and so on? What is the biggest risk for you in the actual environment, which is the biggest opportunity?

So on segments, globally, priority opportunities of growth coming from the following segments: corporate, where we have leadership position, but we really can expand. Hospitals, right, health care and then Sports & Leisure, where we have a global position, but not in every market. And so we can continue to expand based on the success of the last years in new markets. So those are the, I would say, the global ambition. In addition to that, in every country, there are 1, 2 priorities that those countries are driving. The most obvious one, actually, yes. The most obvious one is education in America. Just the American market in itself is so big, but just the education in America is a massive opportunity for us.

Now it turns out, we have a strong, I would say, large business that has suffered in the last years. Reasons, leadership in stability, just lost the contact with the clients, honestly. We've done a reset. It's going to be -- it's going to take a bit of time, but our ambition doesn't go away for sure, absolutely not. So that's from a second segment standpoint.

The second question was about risk. I mean, my absolute conviction is that the biggest risk is complacency. That's what's killing us in execution every day if we are not paying attention. So the answer is with us. There's absolutely no doubt that we can -- we should, we must, we will do much better by intention, but also by discipline day-to-day.

If there are no further questions from the floor, I suggest we now take a few questions by phone. Operator, please?

We have a question from Pravin Gondhale with Barclays.

Congratulations on the Meta win. My first question is on these sort of large contracts that you are vying for similar to Meta. Could you just talk about if you have adopted a different strategy or pricing model to enable more of such contract wins in future? And how margin profile of these contracts compare to the group average margin? And then secondly, on the M&A there, would you be doing M&A to sort of expand your addressable TAM? If so, what sort of new verticals do you think the opportunity exists?

Okay. Thank you. I hope I heard because the voice was coming a little bit muffled, but I would -- so on the first point, which is the large contracts. Let's say that there is a geographical construct, right? We organized by geography inside Sodexo. So unless we have a global layers allowing us to work with large contracts or large clients, it's difficult to really drive those large opportunity mobilizing everybody, okay? That's probably where we've really changed. We had a, I would say, global platform. But I think it wasn't necessarily driving the mobilization across the different countries.

Now leadership and the decision is coming from the top, okay? We have a regular discussion at leadership level about the accounts where we want to go from a global standpoint, in which case, mobilization from everywhere in the world, okay? So that is driving a ton of upside for us. On M&A -- so on M&A, again, I hope I understood. On M&A, our strategy is really to -- for sure, we have defined the perimeter of our strategy, right, in terms of geographies, segments, services. Obviously, now acquisitions we're going to go for have to fit into this strategy. There is no acquisition that will be just opportunistic without fitting our strategy, okay?

Second, Sebastien talked about bolt-on acquisition. And I think it's -- the reality is that we are focusing on bolt-ons for the moment. There will be a point in time, we will be more ambitious. For now, given the activity we have on the basics, we just feel this is the right thing to do. So focusing on bolt-on acquisitions that really bring an edge in some areas that fits our strategy. That's how we are looking at it.

Thank you very much for that. I also asked about the margin profile of large contracts like, how that compares with the group average.

Yes. So you're right. I forgot to answer that one. But there's -- we don't provide margin profile per account or per deal. What I can just say, though, is that given the size of this contract, we wouldn't have signed this deal if it hadn't a reasonable good margin profile.

Is that it? Okay. So ladies and gentlemen, thank you for your presence and your trust. We now invite those of you here in Paris to stay for some refreshments that our teams have prepared for you and informal networking for sure, okay? And then we wish you all a very pleasant summer and look forward to seeing you again on October 23 for the release of our fiscal year '26 annual results. Thank you.

Good morning. Thank you for standing by, and welcome to Sodexo Third Quarter Fiscal Year 2026 Revenues Conference Call. [Operator Instructions] I advise you that this conference is being recorded today on Thursday, July 2, 2026.

At this time, I would like to hand the conference over to the Sodexo team. Please go ahead.

Good morning, everyone, and thank you for joining us for our Q3 fiscal 2026 revenues call. I'm Juliette Klein, Head of Investor Relations. With me on the call today is Sebastien De Tramasure, our CFO, to take us through the presentation. After Sebastien's remarks, we will open the line to take your questions. If you have additional questions after the call, please don't hesitate to reach out to the IR team.

Before we start, I would also like to remind you that we will be hosting our investor update on July 16.

With that, I'll now hand over to Sebastien.

Thank you, Juliette. Good morning, everyone, and thank you for joining us today. So I will start with a brief overview of our third quarter performance and our updated outlook for the year before opening the call for your questions. And as usual, the appendix includes the detailed segment breakdown by geography as well as the 9 months performance, for those of you who would like to see the year-to-date view.

In the first quarter of fiscal 2026, Sodexo delivered revenue of EUR 6.2 billion, with organic revenue growth up 2% above our expectations. Reported revenue growth included a negative currency effect of 2.5%, mainly due to the depreciation of the U.S. dollar, while acquisitions contributed to 1.4%, mainly from Grupo Mediterr nea.

So now looking at our third quarter performance by geography. In North America, organic growth was minus 0.1% or plus 2.2%, excluding the effect of the contract reclassification we discussed at our fiscal H1. Health care and seniors continue to perform well. Sodexo Live! exceeded expectations, driven by a busy events calendar, strong attendance across a number of major sports venues, healthy convention center activity and continued growth in airport lounges volume. Beyond attendance, we also saw higher spend per guest, reflecting the success of our offerings, innovative concepts, brand partnerships across the portfolio. And these positives were partly offset by the impact of prior contract losses in education.

In Europe, organic growth was plus 0.6%, reflecting the impact of a large IFM contract exit in business and administration from prior year and continued softer activity in education. Health care and senior remained robust, while there was a particular high comparable for Sodexo Live! following a strong prior year activity.

In Rest of the World, organic growth was plus 10.6%, supported mainly by new contract ramp-ups and additional project work, especially in energy and resources, with a strong contribution across multiple geographies.

Overall, our third quarter performance was stronger than anticipated, driven mainly by robust activity at Sodexo Live! North America, more projects in Rest of the World and overall, more resilient volumes trend than projected in our guidance.

As a result, we are increasing our fiscal 2026 organic revenue growth guidance and now expect growth between 1.2% and 1.5% compared with 0.5% to 1% previously. This updated guidance reflects both our year-to-date performance and our current expectations for the remainder of the year. At the same time, we are maintaining our underlying operating profit margin guidance of between 3.2% and 3.4%. And to reiterate what we said our half year results, our focus remains on strengthening the business over the medium term. We continue to invest in commercial capabilities, competitiveness, supply and technology, while maintaining a close watch over the external environment and a prudent view of the remainder of the fiscal year.

Finally, in 2 weeks' time, on July 16, we will host our investor update in Paris, where Thierry, I and the team will present our execution roadmap and medium-term ambition. We look forward to seeing many of you there.

With that, I'm happy to take your questions.

[Operator Instructions] First question is from Estelle Weingrod, JPMorgan.

I've got 3 questions, please. I mean the first one, you sounded more constructive on commercial momentum. Could you elaborate a bit more -- net new was sequentially better in Q3, though still negative. Could it turn positive as early as in Q4? So that's on net new.

Also more generally, on your new upgraded guidance for organic growth. It does not really imply any growth in Q4 year-on-year. May I ask why you're being so conservative here? I mean, related to that, what drove this good performance within Sodexo Live! in North America in Q3? And why will not the World Cup also underpin a solid Sodexo Live! in North America in Q4?

And maybe the last one on pricing, unchanged in Q3 versus the first half of the year. How should we think about Q4 and next year?

Thank you, Estelle. So first question on commercial momentum. So what I can tell you that at this stage, we are seeing early encouraging signs on commercial -- net commercial growth. We have a good pipeline. We have also an improved conversion rate.

So overall, when we look at our last 12 months forward-looking net new KPI, it's improving. It has improved when we compare Q3 -- end of Q3 compared to end of Q2. So it's quite positive. And this improvement is expected to come through progressively in the reported in year net new revenue. And the improvement is really coming from development. I mean we have seen this good traction on development. Q2 was better than Q1. Q3 is better than Q2.

On your second question on the organic growth for Q4. So what we need to keep in mind that it's -- Q4 will face tougher comparable. Last year, we had a very strong Q4, especially in energy and resources in North America. And this creates a less favorable year-on-year comparison than in Q3.

Also, second topic for Q4, we have normal phasing of net new opening, closing. We mobilized a lot of contract last year in Q3. So with the fully annualization of those contracts, the incremental contribution, again, year-on-year, will naturally moderate.

And then overall, we see some uncertainty in the macroeconomics, in the geopolitical environment. And at this stage, we believe that it's appropriate to remain present for the remaining part of the year. However, what I can tell you that we are not seeing any -- we're not seeing any specific deterioration overall in the business. Even when -- based on what we see today, we would currently expect Q4 to be modestly positive. But again, as I said, we believe that it's appropriate to remain -- to keep a prudent approach at this stage.

Then I believe that your third question was on Q3 is a very strong performance on Sodexo Live! As I said, overall, strong performance across all the activities of Sodexo Live!, I mean, convention center, airline lounges, sports venues as well. We had very good sport events. I mean, I can give you some examples. We had the BNP Paribas Open at Indian Wells, went super well. Miami opened as well. We had a very strong beginning of the season in baseball with a good game, good affluence, good attendance at T-Mobile Park as well with Seattle Mariners. So overall attendance was pretty good across all the events.

And on top of attendance, also what I said during the speech also, we have been able to catch more revenue. I mean spend per capita has been increasing quite importantly. And we are quite happy with that. And I mean, it's really the way we capture more business. And I mentioned, it's really coming from our offer, innovative concept and also brand partnerships. So overall, again, a very good success of Sodexo Live! It's more than 15% organic growth in Q3. So definitely above our expectations.

And your...

Yes, on pricing, the last one. Sorry, yes.

Yes. And I believe that you have a last question on pricing and inflation. So overall, when I said, when we look at the inflation, we are not seeing any meaningful change at this stage in food inflation overall. There is -- yes, there is some pressure on energy prices, some pressure on transportation and logistic costs.

But overall, as this remain under control. And as you know, we -- managing inflation is really part of what we do. We have different levers also to manage and control our internal inflation. We've been talking about, again, product substitution, working on menu, working with clients and negotiation with supplier as well. So overall, we are monitoring pretty well the input inflation.

Next question is from Simon LeChipre, Jefferies.

I've got 3 as well, please. First of all, following up on the comment on pricing and based on what you see on cost inflation at the moment. So would it be fair to expect pricing for the first part of 2027 to be sort of similar to the 2026 exit rate?

Secondly, on the commercial momentum, any sort of regions or sectors driving the early positive signs in terms of commercial momentum?

And lastly, anything to flag in terms of retention since you last reported in April? And any comments on the U.S. selling season for education, please?

Okay. So on pricing, pricing inflation. So as I said, on the food inflation, internal inflation, we are controlling overall, the evolution of that. Then we have seen also a declining trend in terms of labor inflation. You need to keep in mind that it's a bundle between food inflation and labor inflation. So yes, at this stage, it's quite fair to expect something quite similar for the beginning of the year, with maybe some small pressure on food inflation, but again, a declining trend in terms of labor inflation. So yes, not a big change expected for the beginning of the year on the pricing inflation part.

On your second question on commercial momentum, yes, we have, as I said, encouraging signs. If I mention some region, we see, again, very good momentum on development in the Rest of the World, in APAC, AMEA, in LatAm as well. Also now in the U.S. as well as the dynamic development are to be more encouraging and especially in corporate services. So just to give you some color, good trends Rest of the World, APAC, AMEA, NorAm, especially in Corporate Services.

And last question on retention. So on retention, based on what we see today, overall, we should land broadly in line with last year, I would say, around the 94% level. Specifically on retention in the U.S. and on the selling season for education, I would say that it should be slightly better than last year, but still disappointing. This is a key focus for the team in education in North America now. We have a new leadership for the education segment, new leader for K-12 school segment as well. They both joined recently, working on their own organization where we need to adjust, clear focus on retention, on development, building very clear action plan, account plan and starting to prepare at the end of the day, the next selling season for fiscal year '27.

Next question is from Neil Tyler, Rothschild & Co Redburn.

A couple more from me, please. Firstly, in the Rest of World and the business administrations growth that you point to. I think the statement talks about the faster ramp up of new wins. But I think in your prepared remarks, you also talked about some new projects. Sort of drill into this, but I wanted to understand the latter of those. Is that long duration work? Or is that something that -- these projects, something that might be relatively short dated in terms of the volumes there?

Second question, in terms of the per capita spend that you mentioned in Sodexo Live!, can you sort of talk a little bit more about the other businesses more broadly and geographies more broadly and trends in per cap spend there and what you're seeing?

And then finally, a small one, the education segment in North America. There was -- last year, we had a bit of a calendar effect, negative. Was that -- sorry, positive. And was that helping or hindering the year-on-year growth this year? And if you could just remind us of that, please.

Yes. So first, on the very good performance in the Rest of the World. So yes, it's mainly coming from Business and Administration. Organic growth, 11.9% in Q3, 8.6% in Q2. And the driver, as I said, 2 drivers. The first one, the underlying one, explaining also the good performance of the prior culture is really new wins, net development, very strong development last year, ongoing very strong commercial performance. So this has really helped the underlying organic growth. And on top of that, yes, we have some projects -- additional projects, especially in Energy and Resources in remote sites.

So depending on the nature of the project, it can be sometimes construction, it can be some add-up work on the network, on electricity network, on HVAC. So really depending on -- it can be a preventive maintenance work as well. So depending on the nature of the work, it could be 1 month, 6 weeks, 2 months or longer. So it's really -- it varies. But here, it was really specific projects during the quarter, and we delivered a bit more revenue than expected on that part as well.

On the spend -- spend per capita is really -- I mean, the improvement -- we track this improvement is really within the, I would say, the B2C business in Sodexo Live! And it's -- and when we look at this trend, it's across geographies, especially in North America because of the size of the events, but we see this good dynamic across the globe for Sodexo Live!.

And the last question on the calendar effect. So yes, we had a small calendar effect impact, negative one compared to last year. But there is nothing -- again, nothing this year. When we look at the quarter and the evolution quarter-by-quarter, even in the education, you have also some impact linked to the weather sometime. I know that we don't like to talk about weather, but it explains also sometimes the evolution from one culture to another culture. But for me, what is very important when we look at the evolution of the organic growth in North America is really the impact of the net new. So this is a reflect of the last selling season from last year.

Next question is from Andre Juillard, Deutsche Bank.

A few ones, if I may, just to detail the operating trend in North America and in Europe. We see that in North America, B&I has been clearly under pressure compared to a light acceleration or strong acceleration in Life and Health Care, where in Europe, all segments were down. Could you give us some more color about this trend and what we can expect for the rest of the year? Because as Estelle was mentioning it -- so it's a bit surprising to see such a conservative assumption for Q4. That's my first question.

Regarding the FX that you are planning, you are still maintaining a 3% negative effect on a yearly basis. Do you still feel comfortable with that guidance considering the recent evolution of the euro-dollar, especially?

So to give you a little bit more color regarding the performance by activity, starting with NorAm. We already spoke about 15% organic growth in Sodexo Live! For B&I, you need to keep in mind that we have the impact in North America, the impact of the reclassification of the large contract. So this is impacting Q3. We started the new contract 1st of January. So you have a full impact in Q3. So if we restate this impact, the underlying trend in B&I is very close to what we had in Q2.

And then, yes, we mentioned as well that Health Care and Senior is really trending pretty well, and that means it's 7.8% organic growth for Q3, in line with Q2. So overall, a good...

That should continue.

So we have a good trend. We have a good momentum, and we will have -- will have, again, the fading impact of new from last year. We will have some annualization in Q4. So we are not expecting Health Care and Senior in the U.S. to be at close to 8%. But again, the trend is very good, and the dynamic is strong.

Then if we go to Europe, and to give you some color on B&I, that mean we have really the impact here in Q3 of the demobilization of a large IFM contract that was fully -- so it's not a surprise at all, and it was fully embedded in our guidance. And this is really the impact of the loss of this contract last year with the start of the impact this year beginning of Q3.

And then on the other segment, I mean, education is quite soft in Q3, very similar to Q2. And as I said on Sodexo Live! last year, I mean, we had a very strong Q3 in France and the U.K. and with much more events, especially in the U.K., it's not the case for this year, explaining a soft organic growth for Q3 in Sodexo Live!.

Then on the FX, yes, we are comfortable. We keep our overall minus 3% impact. We will have, as you can see, with the evolution of the euro-dollar, we'll have, I would say, a better, favorable impact in Q4 compared to Q3. So we should land around this minus 3% for the full year.

Just a follow-up one, if I may, on education in the U.S., you were saying that you were disappointed by the recent operating trend, considering that most of the negotiations must be done 6 months in advance for beginning of contract most of the time in September. That means that we should not see a significant improvement in the next few quarters?

Yes. On the -- as I said, on the selling campaign for education, you are right, and we have a pretty good visibility now at this stage. It's the reason why I said that it's a little bit disappointing overall, even if it will be, again, slightly better than last year, but still disappointing, exactly what I said before. And you are right, we have, at this stage, a pretty good view of what should be the final picture on net new for education in the U.S.

Next question is from Ajay Nandal, Citi.

This is Ajay on for Leo. Two questions for me, please. First, on the operating margin guidance. Why was that kept unchanged despite the upgrade to the organic growth guidance?

And secondly, if you can give us some color on the bolt-on acquisitions, that rationale behind the deal and the transaction value involved?

Okay. Thank you for your questions. So on the first one, so it's true that the stronger top line performance is supportive in terms of margin. Now we are still one quarter to go. We have some moving pieces in the business. And we have the speed of our investment. There is also mobilization, demobilization as well. So yes, so still a few moving parts here. And it's the reason why at this stage, we are not changing our margin guidance. We really remain comfortable with the existing range between 3.2% and 3.4%.

And then on your second question on M&A. So again, the large M&A this year were large, midsized M&A was Mediterranea in Spain. Now we have a very small targeted bolt-on acquisition in food, in our existing market. And the objective is to get a little bit more scale, leverage also the supply, get some synergies in terms of back office. So here, it's really -- nothing new, it's fully in line with what we have been doing on those very targeted bolt-on acquisitions.

Next question is from Kate Xiao, Bank of America.

First one on volume. Obviously, it's improved to 0.5% in 9 months compared to 0.2%, which means pretty good performance in 3Q. I guess, can you elaborate a little bit on the underlying trend? Was it mostly driven by Sodexo Live! better spending? Or is there anything else you could potentially share with us?

The second question, can I please ask about the data center opportunity, which obviously is a new and large opportunity in the sector more recently. I personally think it's probably around $70 billion TAM by 2030 in the construction phase and now $20 billion to $30 billion of the operational data centers by 2030. I guess what's your view there? What activities do you already have? And are you in active kind of conversations about future opportunities?

Okay. So I will start with your first question on the volume. So yes, you are right, improved significantly when you look at the year-to-date compared to H1. And as I said, I mean the 2 main reasons for that is first, Sodexo Live!, that means very strong performance of Sodexo Live!, and it comes from volume. And the second reason, as I said, it's the additional project in Rest of the World, especially in Vienna, and this also is impacting volume.

Now on the data center opportunity. So you are right. I mean it's clearly a strong opportunity for us, a fast-growing business. So today, we have some business, obviously, in the data center. And on those, we are already operational. Here, we deliver mostly food. It's 24/7 offer, could be a convenience solution and pantry, et cetera. So this is what we have today. Now what is super important is to target opportunities for data center in the construction phase. So this is really where we can capture most of the value. We are working on the pipeline on that topic. But I can say as well it's -- we have a few opportunities ahead of us.

And also we are quite well positioned here because when you look at what we do in E&R, in Energy and Resources, we are talking about large camp, remote sites, with thousands of workers, and it's exactly -- basically the same offer that we need to address these opportunities in data center in construction. So overall, yes, fast growing opportunity, very interesting market for us working on the pipeline. And we have, again, a very good position there because we can leverage our capabilities expertise we have in Energy and Resources.

Next question is from Pravin Gondhale, Barclays.

Just one on the margin guidance for the full year. Despite the top line bit and the guidance raise there, you have kept the margin guidance unchanged. Is there any change in moving parts of the margin bridge that you explained at H1 results i.e., the operating leverage or the pace of investments there, which meant you have kept the guidance unchanged for now.

I think I already answered that question. But basically, what we said is that the stronger top line is supportive, definitely. Then we have different moving pieces in the business. There is also with mobilization, demobilization, we also have a speed of the investment. So it's the reason why we are more comfortable in keeping our range of our guidance between 3.2% and 3.4% at this stage.

Yes, but my question is that is there any change in the moving parts, let us say, the pace of activities there was in H1?

No. If you look at the bridge and the bridge we comment after H1 publication for the year, it's exactly the as same buckets, I would say, as the same activities. So no significant change on the different levers of the margin.

We have no more questions registered at this time.

So thank you all for joining us today and for all your questions, and we look forward to seeing many of you on the 16th of July. So thank you again, and have a great day.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

Good morning. Thank you for standing by, and welcome to Sodexo's H1 Fiscal Year 2026 Results Conference Call. [Operator Instructions] I advise you that this conference is being recorded today on Friday, April 10, 2026. At this time, I would like to hand the conference over to the Sodexo team. Please go ahead.

Good morning, everyone, and thank you for joining us for our H1 fiscal 2026 Results Call.

I'm Juliette Klein, Head of Investor Relations. With me on the call today are Thierry Delaporte, our CEO; and Sebastien De Tramasure, our CFO. Thierry will start by sharing his assessment and key messages, followed by Sebastien, who will cover the financials. After that, we will open the line for questions. [Operator Instructions] If you have additional questions after the call, please don't hesitate to reach out to the IR team. With that, I'll now hand over to Thierry.

Thank you, Juliette. Good morning, everyone, and thank you for joining the call. This is my first earnings call as CEO of Sodexo. I'm very pleased to be speaking with you today.

What I'll do is I'll share my perspective on where the company stands today, what we are already doing but also the priorities we are setting. We are preparing a more comprehensive update for July 16. Based on our current assessment of the business and the actions we are implementing, there are also some near-term financial considerations. So I want to provide context on how this shape our outlook for 2026.

Over the last 5 months, I've spent most of my time in the field with clients, with teams in operations and with our partners. I've been traveling across the U.S. where I'm spending half of my time but also in Asia, in Europe. I joined Sodexo because I'm genuinely attracted to this business. I know B2B, people-intensive service as well. I know how much value can be created when execution, discipline and client focus come together.

Sodexo, let me tell you, is a special company. The quality of our people, the pride they take in serving clients every day and the expertise on the ground absolutely stands out. We often operate in an environment where reliability, quality, continuity are critical. So delivering this consistently every day and that our scale is no mean feat.

The group was built by Pierre Bellon on a clear entrepreneurial ambition and a strong client mindset. I fully adhere to these foundations. Our priority now is to bring them back to life everywhere. At the same time, this business is different from what I have known before. It's complex in a different way. It's operational, physical highly decentralized and diversified by nature. We have thousands of sites running every day in real time. Disciplined execution and attention to every single detail make the difference.

The real challenge, therefore, is driving rigor, discipline and consistent performance at scale. It's about how we lead, organize and execute. Too often, great people are held back by layers, processes and administration instead of being fully focused on clients. So my conviction is clear, growth is the solution. And growth comes from an obsession with clients on the ground every single day. It's earned contract by contract, side by side, by building trusted relationships and creating value at the client level.

In our model, growth is not just an outcome. It's a catalyst. It drives operating leverage to support profitability enhancement. It basically fuels the organization with energy, talent and confidence. So let me start with a balanced picture of Sodexo today, our strengths and the realities we need to address.

We operate in resilient and growing markets with strong long-term growth drivers. Demand for outsourced services in both food and facility management continues to expand. We also have a global and highly diversified client portfolio, as I said, across geographies, segments, services. In many cases, we are the best partner to self-deliver an integrated proposition with one governance across multiple geographies. This strengthens client relationships and gives us additional levers to grow alongside them.

Another key strength is our people-led service culture. Teams who care, who show up for clients every day, and we take pride in delivering. In a people-intensive business like ours, this is fundamental. It's a foundation we will build on as we restore execution and growth. But we also have to face the facts. And the facts are we have consistently underperformed our market and our peers. We underinvested in key capabilities that are critical to run well this business at scale and build a repeatable model. We have not been consistent enough in deploying a best-in-class offer in execution and in the predictability of our delivery and guidance.

So what has held us back? The root cause is go back a long time, and there is no [ synoptics ]. First, commercial intensity. We have not shown enough appetite to win, not enough hunger to fight for clients to stay close to them, to truly understand their expectations, to anticipate and even surprise them. We have not been consistent enough in the way we drive growth and retention, winning, defending, expanding key accounts always with discipline and cadence. In a service business, you just can't review sales momentum once in a while and expect intensity to magically appear. It requires systematic follow-up and accountability and sharper engagement with clients. That is changing.

Second, empowerment and decisiveness. Decision rights, accountability have become diluted across layers. The heavy structure will slow you down, creating [ interference ] and reduces the permission to act close to the clients and the operations. And third, the prioritization and focus, past organizational choices and too many parallel initiatives wasted attention and [ to resources ]. We were not consistently putting our people and capital towards the highest value priorities. Sometimes, short-term trade-offs prevailed over long-term value creation. As a consequence, we have not invested enough in the capabilities that make execution predictable, sales effectiveness, account management, processes, systems and tools.

Now let me move to what we are doing differently starting now, and with a clear focus. We are turning the entire organization towards growth, restoring execution discipline and creating a real sense of accountability and urgency across the board. The first decision I made was to take direct leadership of North America, I wanted to go deep into the business, understand what works and what doesn't and make the necessary changes at the right pace.

Over the past months, we have changed around 2/3 of the leadership team in North America. This is about bringing the right mix of experience, energy, accountability. We combine internal talent with external hires to better serve our clients and execute more consistently across America. In parallel, we simplified the global leadership structure, and we reshaped the executive committee to be more execution focused. We removed the zone layer with regional CEOs now reporting directly to me. This, inevitably, short-term decision paths strengthens accountability and brings leadership much closer to clients and operations.

The Executive Committee now brings together the business leaders and a very limited number of global functions. And it has a clear mandate, enable execution across the group with discipline and urgency. We also we anchored incentives on growth to reinforce focus and accountability across the organization. In parallel, we are reinforcing sales capabilities, not only in the U.S. but everywhere.

Beyond resources, we are strengthening our commercial engine by tightening discipline and governance. We are now consistently running a monthly review of commercial performance, which was not the case, clarifying account ownership and reinforcing the role of account managers. There are key leaders in the organization, fully accountable for client development and retention.

We are also accelerating investments in technology. This work has already started. You know that, but it's clear we need to move faster. The focus is on strengthening our core systems, notably finance and HR, and scaling client-facing digital solutions. To me, these are no option. They are required to improve the productivity, speed and overall performance for our teams and for our clients.

Finally, we have reinforced a disciplined and systematic reassessment of contract and assets taking into account changes in the environment, but also the strategic choices we make. Sebastien will explain how this has translated into the numbers. These measures, for sure, have a short-term impact on margin. This is deliberate. We are choosing to fix the engine properly rather than optimize around the ages that allow us to raise execution start-ups immediately, then over time to reaccelerate growth in a sustainable way.

Now looking forward, our next priority are also very clear. First, we are aligning the organization around a single execution agenda, one set of priorities and clear choices on where we play, how we operate and where we invest. Our choices grounded in one -- in our strengths, our clients' needs and market trends. We call this program shift and grow because that is what it is about shifting the business to grow faster.

Second, we are changing how we run the company. Decision-making is being pushed closer to the clients. Operational teams are being empowered. Headquarters are refocused on supporting execution rather than adding layers. At the same time, we are restoring competitiveness across the model, starting with labor. In my view, while a lot has already been done on supply, workforce management is where we see the biggest opportunity, actively managing the workforce pyramid, improving on-site utilization better matching staffing to client demand. That's what I've done for years. We're going to do it here. All of this supported by stronger processes and tools. And let's be clear, these actions are already in motion.

Finally, we are reinforcing a strong client focus every day. I'm talking to some of our clients. I make a priority. In all our leadership meetings, we start with client cases, we're keeping this focus front and center, and I want every leader to personally own the client relationship and performance. We are also strengthening our performance culture. We are developing internal talent, bringing in external capabilities where needed and raising the bar on delivery. This is about empowerment and accountability. All of this has clear implications for how we invest, allocate capital and approach the year ahead. That brings me to the recalibrated baseline. We are setting for the fiscal year '26.

Turning to H1. The numbers reflect both ongoing execution challenges and deliberate management actions to establish a more disciplined baseline. Organic growth was plus 1.7%, consistent with what we laid out in January, but frankly, below what this business should be delivering.

Looking at our commercial indicators, retention over the last 12 months was 93.4%, and development, 5.3%. That's leading to negative net new business levels that are not where they should be, reflecting both execution issues, and an insufficient quality of pipeline and win rates. The underlying operating profit margin was 3.7%, which is down 140 basis points year-on-year. This reflects operational challenges in specific areas, for sure, and the impact of the deep review of contracts and assets we have conducted in the last few weeks and days.

As we look to the full year, weaker than net new business in the first half will obviously weigh on organic growth in the second half as well as lower volumes in an uncertain external environment. Lower operating leverage, execution issues in H1 and the actions we are taking are reflected in our outlook. Taken together, this leads to a recalibrated starting point for FY '26 with now an organic growth expected between plus 0.5% and 1% and an underlying operating profit margin between 3.2% and 3.4%.

So before I hand over to Sebastien, I want to say, I'm confident in the direction we are taking. The work is well underway. We clearly see where the levers are for improvements. We are operating in markets that are fundamentally attractive, and we are convinced of the relevance of our model. We are already seeing tangible changes in how teams work together, how decisions are made and how we go to market.

With that, I now hand over to Sebastien to walk you through the H1 performance in more detail, and we'll talk later. Thank you.

Thank you, Thierry, and good morning, everyone. So I will now walk you through our first half financial performance in more detail, and let me start with revenue and organic growth at group level.

So reported revenue growth in the first half was significantly impacted by foreign exchange with a negative impact of 5.3%, mainly driven by the U.S. dollar depreciation. M&A had no material impact in the first half as the acquisition of Mediterránea was completed at the very end of February.

Organic growth for the group was plus 1.7%. Pricing contributed around 2.4%. Like-for-like volume growth was around 0.2%, supported by cross-selling, especially in Healthcare, offset by a strong comparable in Sodexo Live! in the first half of last year, which benefited from an exceptional level of events.

Net new business was negative at around minus 0.6%, reflecting prior year contract losses, mainly in Education and Business & Administration. And finally, we had an impact of around minus 0.3% from a contract reclassification in North America Business & Administration. And this followed the renewal of a contract where the economics and [ contractual ] terms evolved, leading to revenue being recognized on a net basis, rather than on a growth basis, fully in line with IFRS requirements. And as a reminder, the annualized impact of this reclarification is around 100 basis points at group level and will, therefore, weigh more in the second half of the year.

Turning now to underlying operating profit margin, which stood at 3.7%. Year-on-year, the group's underlying profit margin declined by approximately 150 basis points in the first half, including a negative foreign exchange impact of 6 basis points.

And this evolution can be explained by 3 main factors. First, operations, mix and leverage representing around minus 50 basis points. This reflects mobilization cost and new contract under performance on a limited number of contracts and unfavorable portfolio mix and softer organic growth in the first half. At the same time, we are actively addressing these execution challenges and continuing to drive efficiency and productivity across the group, especially through shared service and efficiency initiatives.

Second, the acceleration of investments for around minus 20 basis points. These are deliberate investment, notably in technology, system, supply and commercial capabilities fully aligned with the execution priorities Thierry outlined earlier.

And finally, the review of contract and asset that Thierry mentioned had an impact of around minus 70 basis points. And depending on their nature, the outcome of this review affect either underlying operating profit or other operating income and expenses. The impact at underlying operating profit level mainly reflects contract-specific provision following a detailed assessment of actual contract performance, credit risk exposure and litigation matters based on an updated assumption in the current market environment where appropriate. This review was also about improving visibility, reducing future volatility, reflecting clear management choices to address risk earlier and establish a more robust and predictable baseline going forward.

Now that we have covered the group picture on both growth and margin, let me turn to the regional view. Starting with North America. Organic growth was down 1.8%, mainly due to contract losses in Education and Business & Administration, changes in scope on certain Business & Administration contract and the one-off reclassification effect. Healthcare continued to deliver strong growth driven by new contracts while Sodexo Live! softer due to a tough prior year comparison. In Europe, organic growth was 2.8%, supported by Healthcare & Senior as well as strong activity in Sodexo Live! across airport lounges and events, while education remains softer.

Rest of the World delivered organic growth of 9.2%, driven by new contract ramp-ups and strong underlying dynamic across markets, especially in India, Australia and Brazil. From a margin perspective, the decline was more pronounced in North America where the underlying operating margin decreased by around 200 basis points year-on-year and this largely reflects the execution challenges, the accelerated investment and the action referenced earlier.

In Europe and Rest of the World, margins also declined year-on-year mainly reflecting the impact of management actions related to the review of contracts and assets while underlying operational performance remain broadly stable.

Now moving to the income statement. So having covered revenue and underlying profit and before coming back to the other operating income and expenses in the next slide, let me complete the picture with financial results, tax and net profit.

Net financial expense increased by EUR 24 million year-on-year, mainly reflecting a higher gross cost of debt following the issuance of the U.S. dollar bonds in May 2025 at higher coupons. As a reminder, these bonds were issued in anticipation of the April and June 2026 debt maturities, which we intend to repay from cash reserves.

The effective tax rate was 25.9% compared to 19.5% last year. Last year was impacted by one-off positive items, including the update of tax risk related to the Sodexo S.A. tax audit. And net profit for the first half was EUR 188 million. And on an underlying basis, net profit was EUR 285 million, down 37% year-on-year, reflecting lower underlying operating profit and adverse currency effect currencies.

Turning to other operating income and expenses. The increase versus last year mainly reflects higher restructuring and rationalization costs linked to organizational changes, leadership adjustment and transformation project. Amortization of purchased intangible assets was stable year-on-year, and other items mainly reflect some assets and footprint rationalization decision, including the write-off of certain production and operational assets, for example, following the rationalization of central production units where capacity has been consolidated into fewer, more efficient sites. They also include pension-related items driven by legislative change in labor law in India as well as the recognition of one-off costs related to multiemployer pension plan in the U.S.

Turning now to cash flow. Operating cash flow was EUR 616 million, up EUR 16 million year-on-year and this reflects the fact that last year included an exceptional tax outflow related to the Sodexo S.A. tax audit, partially offset this year by lower operating profit. The change in working capital was negative EUR 490 million and as a reminder, the first half is seasonal low point of our cash generation, and we expect working capital to normalize by the end of the year.

Net capital expenditure increased year-on-year mainly due to one-off client investment in the context of contracts renewals. Free cash flow was therefore broadly flat year-on-year at negative EUR 243 million. Net acquisition amounted to EUR 256 million, mainly reflecting the acquisition of Mediterránea alongside smaller bolt-on acquisition in Europe.

As a result, our net debt increased to EUR 3.6 billion, corresponding to a net debt-to-EBITDA ratio of 2.7x. This reflects the usual seasonality of cash flow in the first half, but also lower EBITDA days than last year. And as always, we expect a seasonal improvement in net debt in the second half. That said, based on the revised full year fiscal 2026 guidance and the recalibrated baseline, it implies we now expect to end the year with a net debt-to-EBITDA ratio above our target range of 1 to 2x.

Let me close by coming back to our guidance for the year and giving you a bit of additional color. So Thierry outlined, this is the guidance we are providing today, reflecting our current assumption and the action we are taking. We now expect fiscal year 2026 organic growth to be between 0.5% and 1%. So this reflects weaker-than-expected commercial performance and in particular, in retention impacting the second half as well as lower volume in an uncertain external environment.

Underlying operating profit margin is now expected to be between 3.2% and 3.4%. This reflects reduced operating leverage from a softer top line, ongoing operational execution challenges, the continued impact of our review of contract and asset over the full year and the accelerated investments we are making to strengthen execution.

Let me also share a few key modeling assumptions for clarity. So based on current spot rates, we assume a full year 2026 currency impact of around minus 3% on reported revenue. We also assume a positive M&A impact of around 0.5% on revenue, mainly from the acquisition of Mediterránea offset by a few small disposals. On other operating income and expenses, reflecting the level already recorded in the first half, we now expect the full year amount in fiscal 2026 to be around minus EUR 300 million, of which roughly half is restructuring. Net financial expenses are still expected to be around minus EUR 140 million and our effective tax rate to be around 26%.

So to conclude, the first half reflects a demanding environment, but also clear and decisive management action on contracts, asset, organization and investment now reflected in today's guidance. As Thierry outlined earlier, this action weighed on the near term but are necessary to reset a realistic deadline and strengthen execution, competitiveness and sustainable performance over the time.

With that, Thierry and I will be happy to take your questions.

[Operator Instructions] First question is from Jamie Rollo, Morgan Stanley.

So 2 questions. The first one is just on the margin guidance, 3.2% to 3.4%. That's obviously a very helpful clear range, but there's a lot of numbers in that. And you've given us a helpful bridge for the first half, it would be quite helpful to get that bridge for the full year margin, particularly to quantify the contract asset write-down because obviously, that's a one-off and that suggests that 2027 margin should increase naturally. But then again, Thierry, maybe your July review will lead to another step-up in investment next year. So any sort of flavor for what the real underlying base margin might be would be very helpful.

And then the second question was just on the leverage as you say, well above the target. I appreciate you've got no covenants, you're pretty well all fixed debt. But what sort of constraints might this have on CapEx spend or bolt-on M&A going forward?

Jamie, thank you. So what I'll do is I'll take the first part of your question and give a little bit of context, and then I'll take the second one on the leverage. And then I'll ask Sebastien to add a lot more details and probably on the bridge you're asking for H2.

What we've done, Jamie, is clear. We've done, as we said, clearly the objective and that's why it's my [ ask ] for Sebastien and the team is do a comprehensive review of contracts, asset, risk by the end of the quarter. So literally in the last -- and you know that we do, at Sodexo things are going to change. But until now, there is one single process of forecast per quarter. This is changing to a monthly process now.

So what we've done is a very deep reviews of the risks in the contracts and really assess the situation and provision where appropriate. This is not a [indiscernible]. This is really looking at the existence of risk that we have and the level of provision we have against that. For sure, given this -- there's a disciplined risk review embedded into our processes going forward at each closing, but this review we've done is a pretty extensive one for sure.

Objective. Simple, improve visibility, reduce the volatility and limit the surprise which has been the issue of Sodexo for the last quarters. So let's be honest, what we've done is create a more solid earnings floor and a stronger base for growth. So that's the philosophy. Now to your point on the guidance and the bridge for H2, you want to cover it, and then I'll come back on the leverage target, connection, okay?

So thank you, Jamie. So if you look at the bridge, we shared with you for H1, 3 drivers. So when we look at the full year bridge drivers are broadly the same as the one in the first half. I would say that the impact of the operation mix and leverage, we are not expecting any change between H1 in H2. Then we will accelerate investments. So we mean that the investment rate will be a little bit more on the full year and in H2. And the review of the contract and asset will be lower in the second half of the year.

You asked for '27 as well, Jamie. So for sure, we're not guiding for '27. All I can say is I think you can consider '26 guidance as a floor.

Now to your second point, leverage, right? You're absolutely right. The capital allocation framework is the result of a strategy. It's not -- and right now, the strategy is to regain performance, let's be clear, okay? So it's a special year. You can see that. And it wouldn't make much sense to, I would say, give detailed capital allocation messages without first setting a clear direction of travel. So that's what we will do in July. So if you can hold on this 1 for 2 months, 3 months, we'll tell more.

Until then, priority is execution and performance recovery. Everything else follows from that. The leverage fully aware, maybe temporarily above our historical range, you know that reflecting lower margins during the reset phase and the investments we are making to stabilize the execution, but also rebuild the business. But this -- and that's an important point as well. To me, this does not limit our flexibility or block any of our actions.

And if I may, just we remain a strong cash-generative business, and we will keep and retain a good access to funding. And again, this temporary effect on average are clearly not structural.

Okay. So just to clarify then, we'll hear more about the capital allocation in July? And also in July, you're going to be giving, I assume, some medium-term targets and framework? Anything else we should be expecting in July?

So the investor update in July will give for sure, greater visibility on FY '27. And in the, yes, medium-term financial ambition. What we'll do there, Jamie, is we will articulate where we want to position the group versus the best-in-class benchmarks. That's our ambition for sure, including a clear ambition to narrow the growth gap, okay, versus the strongest players in the market.

We will also, for sure, present a detailed action plan, underpinning that ambition with you will see clear strategic priorities and financial levers over the medium term, right? So that's what you should expect.

Next question is from Jaafar Mestari, BNP Paribas Exane.

I have 2 questions, please. The first one is just an open-ended question on the review of contracts and assets. Can you give us more concrete examples of what you're reviewing and changes you're making? It was interesting. You mentioned some central [ kitchens ] are being consolidated into a smaller number of sites, for example. Just keen to hear more on those, what sort of measures you're taking? It seems pretty broad ranging. And I'm really mostly interested in the ones that fall into adjusted profits, not on the stuff that is exceptionals, please?

And then secondly, on management compensation, there was an undisclosed margin target for full year '26 in your cash bonus for this year. You never said what it was because it was commercially sensitive. Can I ask you if you're basically accepting that you're not getting paid on this part of the targets because you've ended up lower? Or would you expect the Board to adjust these compensation targets because of the voluntary nature of some of the measures you're taking?

And related to that, can you remind us factually what's the policy on stock option awards. If I'm correct, Mr. Delaporte, you still have not been awarded your performance shares for this year and understand why the Board did this after disappointing full year results, but if you were awarded them immediately after today's announcement, you would also look perhaps like you're not exactly in the same boat as investors yet?

So Jaafar, I'll try to take the point, and I hope -- you tell me if I don't cover well all the points, okay?

On the first one about the contracts and assets. What's so sure is that when we look at contracts, the operational performance on contracts, fortunately, most of them are performing well and delivering results for the client and for ourselves. In cases, there are delivery issues, how do we provide for it? How do we make sure that we are investing into addressing those concerns and therefore, how does it change the financial profile of this deal.

When we are in financial distress on an account, how do we handle it? Are we renegotiating with clients? Are we improving the way we are delivering? Or are we exiting the contracts? All these questions have been addressed and covered in the way we were looking at the contracts.

And you're right regarding assets, I'll let Sebastien, but the point was, again, to look at assets we have. And are they long-term investments for us or not? Does it require decisions to be made? Over to you, Sebastien.

So on the impact of the review of the contract and assets, the impact on underlying operating profit, so one part is really the assessment and the reassessment of the credit risk around 25%. And when we look at also contract and contract litigation related claims, so we have also covered all of that. It's again around 25% of the impact in terms of [ UOP ].

And then also, we have looked in this -- in the performance of the contract, and that impacted also for additional provision. And then on the write-off of assets, this is really the part impacting the other income and expenses below the line. And here, yes, we look at the footprint of our off-site production. And we took in some geographies, a very deliberate decision to consolidate part of that and this implies some write-offs and impairment in our balance sheet.

Okay. Thanks. On the second point, management compensation, if you're talking about leadership compensation and [ I'll all ] mine. So let's cover both, if you want. So what I've done is for the leadership team is we have made sure that while they are committed to delivering the forecast of the budget of the year, we are refocusing in H2 more part of their incentive on the growth because this is what we need now to get ready for FY '27. And so I didn't want us to wait another 6 months and really push on the accelerator now.

As for my compensation, I think, honestly, this is not me to comment them on. It's a Board decision that will have to be approved by the general assembly. All I can tell you is that it includes certainly financial KPIs about growth and profitability. So I'm not immune for sure. As for LTI plan, the LTI plan will be launched in the next weeks. It is not related with the communication today. It's -- I think last year was the same timing in the year. So I think it's just followed the same logic. But also, we are changing the scheme for our people to make it more a performance-based LTI as opposed to presence-based LTI. So that's the philosophy.

And just on the contract we use and just to be very clear, should we expect that you formalize a revenue figure for contracts that you'll be exiting? Or is it less explicit than that?

Yes. Again, at that time, when we look at this review of contracts and assets, it's really linked to -- its case by case. And it is not linked to exiting a large portfolio of activities or even any specific contract. We have booked some provisions for onerous contracts in that case because the contract was not performing at the right level.

Let's be clear, we have done what we had to do. It's just normal practice. Probably I'm injecting my way of drive a certain level of prudence in the way we are looking at risk, for sure.

Next question is from Estelle Weingrod, JPMorgan.

You mentioned lower retention and volumes impacting the remainder of the year. Can you just provide -- I may have missed it, but can you provide details on the new contract process and who you lose them to? And what volumes you are budgeting for H2? Are they going to be in negative territory?

Thank you, Estelle. So yes, when you look at our annual guidance between 0.5% and 1%, if you take the midpoint, it implies a negative organic growth in the second half of the year. If we look at the different drivers, pricing was 2.4% in H1, we are expecting something very similar for the second half of the year.

And then you have the net new contributions, minus 0.6% in H1. And same here, we are expecting something very similar to the -- for the second half of the year. Then we need to -- you need to keep in mind, sorry, is that we also have the impact of the contract reclassification and then we will have a full semester impact on organic growth for around 100 basis points. And then the remaining part is linked to volume.

And it's true that we are taking a more cautious stance regarding volume. This is clearly linked to the overall environment, macro, geopolitics as well. And we know also that we have some volatility in our revenues to volume what we decided to include.

And your more cautious stance on volumes? Is it driven by a specific region? Like is it more North America? Or is it broad-based?

It's broad-based.

Next question is from Simon LeChipre with Jefferies.

Yes. Three questions, please. First of all, a follow-up on the margin bridge for H2. Could you be a bit more specific in terms of the investment, I mean should we expect this going to double in H2 relative to H1? And should we expect some incremental investment in 2027 as well?

Second thing is in terms of top line going forward and looking at the last 12 months net new, it was minus 1.3%. You expect net new minus 0.5% in H2. Should we expect net new still be negative in the first part of '27? And more broadly speaking, how do you think about the path in terms of top line acceleration? And when do you expect to see the benefit of the actions you have taken and you are currently implementing?

And lastly, in terms of the U.S. and the management team, I mean what's the road map? Are you actively looking for someone? Do you intend to still remain CEO for the region as of now?

Yes. So Simon, thank you. So taking your questions in no particular order, if you don't mind. The first one on the U.S. management team. So I joined on November 10, literally first days, it appear to me that I needed to make something change in America. It's -- America is our greatest market, the biggest, and it's a strategic market for us. I was coming from a different industry, it was critical for me to dive into the operations.

America was my priority. I dove into it. I took it over. It's basically what I decided, and I'm very pleased with that because it allows me to really spend time in America, as I said, 50% of it. I've spent 20 years in America. So I know well this market and shaping the team is absolutely key. We have great talent in America. We have great accounts, great team as well, and I have wonderful leaders.

We had significant weaknesses as well. And so we had to fix it. I've been working on it. I've made a lot of changes in the leadership team over the last weeks and months and reinjecting energy and ambition in America. The timing -- the team is great, is well mobilized. In the meantime, I'm looking for talent to take over the North American role for me. And it's -- I'm not supposed to -- do not consider that I stay in this role forever. But I'm not in a hurry because I feel that being very close to the operations is a [ greatly full ] for me and for the operations. But yes, for sure, there will be a leader of America at some point in time.

On the point #1, that is the margin -- also margin bridge for H2, we'll let you say it. But one thing I can tell you, because you were -- a question around the investment for FY '27. So for sure, we are doing investments now. We couldn't wait in the situation where we need to inject accelerate fuel, if you like, into our growth, it's the time to grow -- to invest. And so we have started to invest now. And we know them well that this is impacting our margin in H2. And for sure, we will not stop the investment on December 30 -- actually on August 31.

So for sure, it will continue in FY '27. The objective for sure is that as we progress steadily, the growth will come back and pick up to supported by the investments we are making now. That's the whole logic. You know more about the sequence in the next interactions. Over to you, Sebastien.

Yes. So on the margin, as I said, if you look at again at the bridge H1, H2 full year, the part related to operation and leverage remains the same, around minus 50 basis points, then you will have more impact on investment of the acceleration of the investment in the second half of the year. So with a higher weight of that on the bridge, and we will have lower impact coming from the review of contracts and assets for the second half of the year.

Next question is from Kate Xiao, Bank of America.

First, I want to follow up on -- I still want to ask a couple of questions on contract assessment and provisions. Has this process affected your retention rate and development numbers because both of these 2 numbers are down compared to FY '25 and as of last quarter? And would there be -- I understand that this is an ongoing process, would there be a scope for reversal for some of the provisions if contracts actually turned out to be better than expected?

My second question -- sorry. And my second question is around just look, simple one. When you mentioned, Thierry, that there's early positive signals. Can you talk to us a little bit more about these signals?

Yes, correct. Correct. Okay. So Kate, on the first one, contract assessment. It has been occasionally that indeed, but I don't think it's a huge impact on the retention, honestly. So those are 2 different things. For the scope for potential reversal of provision, for sure, that's the objective. I mean, we are covering the risk, but we are not giving up on it. We are fighting, but we are in a logic where when there is risk, we provide for it and then we try to mitigate the risk as opposed to we have a risk, and we hope it doesn't materialize and when it materializes, it blows up and we are surprised. So that's the change in philosophy.

Last early positive signals, sales performance intensity in the market. There are several deals. I know for a fact, several deals that we were about to lose that we haven't lost. And the energy in the system, the mobilization from the team is really great. So a lot of good signals, honestly, okay. It's still early. I'm not going to tell you other than that.

Can I just quickly follow up on retention rate, if there's not a big impact from the reassessment of contracts? What has led to the lower rate at 93.4% now versus 94%? Was there more contract losses that you can kind of tell us a bit more about? And would you see this as a trough?

Well, let me tell you one thing first, Kate, on the assessment of retention rate. For us where it stands is a signal for sure. Every -- I consider that every time we lose a contract, it's dramatic, okay? So we have to stop accepting the fact that we are losing contracts. So it's in us, and we are very active on that.

Now it's -- in a given quarter, you might have more or less contract to retain. And so just looking at this ratio just for 1 quarter or 2 is not necessarily enough to draw conclusion. Except that, our ambition is to be closer to 95%, 96%. I think today, 95%, but the objective is to continue to improve and we have some work to do. And that's what we are working on at the moment. Sebastien, you want to say more? No? All right.

Next question is from Pravin Gondhale, Barclays.

Firstly, on the incentives aligned to growth that you talked about. Sorry, if I'm being nuanced. But could you please clarify, are these incentives linked to gross growth or net growth, i.e. incentives for both gross development and retention or just the gross development here?

And then secondly, on the review of contracts. Is this all done and then fully captured in your H2 guide annualizing in H1 next year? Or is there any tail left to review further down the line?

So Pravin, thanks. I'll take the first one. On the incentive. First, KPIs have been reset for my direct report in H2 to really get the target -- the growth target for H2, and that's revised growth target. What does it entail? It's what we call commercial growth, net commercial growth, which basically takes net development, I mean, new development plus retention plus cross-sell, okay?

So that's the combination of all, all right? And then after when you look at the organization, it depends, those who are focused on retention, those who are working on closing new deals, for sure, they have different set of KPIs. The objective here is to set clear accountability, but also drive focus across the organization. Okay. Now just to be clear, even if you haven't asked, gross incentives do not mean volume at any cost. We continue to keep an eye for sure on the level of profitability expected from the deals, for sure.

Review of contract, is it all done? Well, first of all, we've done a very good job, I think, to review the contract in a very short time frame. And I think the team has done a great job. So I'm pleased about that. Will it be a continuation? I mean the fact that we will review contract and assess the risk is of discipline. We will do it every single quarter. So this will not change. Are we expecting further impact going forward? I mean our objective is precisely to have done the job.

Next question is from Neil Tyler, Rothschild & Co Redburn.

Two questions, please. Firstly, on the contract review, I wonder if you could share any sort of insights that you drew from those contracts that you've had to provide against, whether there's any commonalities emerging from the contracts either in terms of regions duration or sort of start point, those that needed to be reassessed.

And then secondly, on the -- back to the incentive program, has the altered incentives been or will they reach further into the organization than they have done in the past in order to alter the selling behavior sort of deeper into the organization rather than just at the management level.

You tell me if I do not address -- maybe I do not really understand your question, Neil, on incentives. But my point is we have implemented a new set of KPIs across the organization. It's not only for managers, it's across the organization for H2, okay?

On the contract reviews, insights, you want to take this one, Sebastien?

I can tell -- yes, I can take this one. So in terms of framework, I can tell you that we apply this framework across all regions, okay, all segments. Around 50% of the adjustment adding to the review related to Europe, 1/3 is North America and the remaining part is the Rest of the World. And when we look at the framework, again, was done really case by case, contract by contract, asset by asset. And on the commonalities, again, as I mentioned, it was linked to the credit risk, credit exposure, again, across a portfolio of contract.

It was also linked to legal risk litigation, again, across all regions, and then we look at the performance of some of the contracts, as I said, and we apply again a new calculation again on the potential adjustment needed in terms of onerous provision. So it's really the same framework across the globe on a contract basis and the case by case basis approach.

That's helpful. And can I just ask, within that, was there any difference between food service and facilities management contracts in terms of how those materialize?

Type of risk may differ, but again, the methodology and the framework was exactly the same.

Next question is from Andre Juillard, Deutsche Bank.

First one is about CapEx. Could you give us some more color about what you plan to do considering that historically, Sodexo had a lower level compared to its main peers? And I wanted to understand if you have a clear view on what we could expect on that side.

Second one, about dividend. We know that historically, the dividend has been important for Sodexo and for its main shareholder. So do you have a view on what you could do on that side?

Thank you for the 2 questions. My answer is going to be quite similar on both. We'll meet at the Capital Markets Day. CapEx consider that, as I said, I said -- I covered it for me, right now, our strategy is to regain performance, focus on the performance, we'll discuss the capital allocation messages when we are together in July, July 16.

On dividend, same thing. Too early to tell. We are very aware of this. We will certainly discuss at the Board as well. So we'll get back to you, not now.

Next question is from Julien Richer, Kepler Cheuvreux.

A quick follow-up on growth and strategy. We recently had some comments from the French government about the structural decline in the number of kids at school due to the demographic situation in the country, and this is not only the case of France, I suppose. How do you see your education division going forward? Any view on this point?

So for sure, this is a -- we are -- obviously, as you can imagine, as we are working on our strategy and refining it -- they are -- and we spend more time on it at the Capital Market Day. They are time focused on looking at for each of the segments we operate in where there is more growth to expect. Sometimes, you have different elements that have an implication. The market growth itself. There's the level of outsourced, right?

So in some cases, you may have markets where the growth is not necessarily significant, but there's a wave of outsourcing that we can trigger to drive new type of clients, and they are, for sure, a prioritization on those investments. So without being specific, we are very aware of those declined head count or population decline in schools in France or in the next few years.

It's elements that we are considering for our -- for the way we are investing into our segments and again, we do it by country. And within segments, we look at the services that are more relevant, the ones that are a little less. But to be clear, education is one of our big segments, and we'll continue to invest in education for sure.

Next question is from Sabrina Blanc, Bernstein.

I have 2 questions from my part. The first one is regarding the review of the contract. And just to understand if you have a schedule potentially to exit some contracts or potential to exit some assets. For example, we know already that the number of countries has been reduced. But do you intend to go further?

And my second question, I can perhaps answer directly that I should expect this Capital Market Day. But could we have visibility on free cash flow and potentially on conversion rate?

Okay. So thank you, Sabrina. First question, so the review of contracts. So again, we are taking decisions. We have taken decisions on some situations when there is -- if you do not -- if you are in a situation where you do not foresee opportunities to be profitable, this exit is one scenario. So I'll keep this freedom going forward. It may happen at times that -- and good decision sometimes is to recognize the fact that it's just not working.

So we feel we have done the job and -- but we'll keep an eye on it and make sure that when we are signing contracts, we are signing good contracts and that it doesn't end up being an issue for the client, for ourselves.

Exiting countries. No, we have no plans of exiting more countries. In fact, if I can tell you I believe it's a strength of Sodexo to offer to a lot of our global clients a global presence, and we want to build on this.

As for free cash flow, over to you, Sebastien.

Thank you, Thierry. So on the free cash flow, as I said, we remain a cash-generative business. So we'll keep a strong focus on that. And we are expecting again to have an underlying conversion rate, I mean, for this year that will be very in line with and consistent with prior years on the underlying part. And on the future, as you said, Sabrina, we will come back to that during the Capital Market Day.

Finally one -- do we have someone?

Next question is from [ Eva ] [indiscernible], UBS.

Welcome to the company, I suppose. I want to talk a little bit more about the market as a whole. I mean you mentioned commercial momentum being slightly weaker than expected. But is that an indication of any slowdown in the market itself? Or is it simply your execution? So in other words, I mean, are we still seeing the amount of new business in the market as a whole being strong or have recent developments had an impact on that?

And secondly, I mean this might be slightly minutia to a certain extent, but you mentioned your refinancing costs associated with debt this year isn't going to be an issue, but you still have an awful lot of debt to refinance over coming years, which was issued at very, very low coupons. So as and when that gets refinanced, how is that actually going to be able to impact your ability to compete with peers who might not have the same level of pressure on that front?

On the first question, the commercial momentum, it's a good question. And I spend time to review that with the team. The conviction we have is that the market is actually a rather good market, okay? So we do not -- we are not taking this on the back of any kind of slowdown. Yes, for sure, moments like what is happening in Middle East are elements of potential slowdown, although it has limited impact for us in terms of size, but the market continues to be good.

I'm convinced that the answer is with us. So addressing our own structural and operational challenges will just make us stronger and able to win more. One argument for that supporting this is the fact that the pipeline is not going down. Actually, if we look at the pipeline, it's actually going slightly up. Still not big enough, okay? But again, it's the same -- going back to the same point, our intensity in the market and to grab opportunities and go after it.

Sebastien?

Yes. And on the cost of the financing, it's true that if we look at where we are today, the average interest rate on the bond is around -- we are around 2.7%. I told you about the cost -- financial cost for fiscal year '26 to be circa EUR 140 million. And then it's true that for the coming years, we are expecting also an increase of the financial cost, linked to the renewal and the refinancing of the bond in 2027.

So yes, the cost of financing will increase again in the next 3, 4 years, around EUR 30 million. We would be around EUR 170 million, EUR 190 million in terms of annual cost in 3, 4 years. And this will be an average cost circa 4%, 4.5% depending on the cost. It will depend obviously on the market rates.

Sodexo team, we have no more questions registered at this time.

All right. Thank you for your questions. Thank you for the conversation today and for the time. We are very aware of where we need to improve, and we're fully focused on execution and getting the basics right again. So we'll have the opportunity, as we discussed, to go into our plan and ambitions in July, and I'm looking forward to continuing the dialogue with you.

Thank you very much for joining us today.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

Good morning. Thank you for standing by, and welcome to Sodexo's First Quarter Fiscal 2026 Revenue Conference Call.

[Operator Instructions]

I advise you that this conference is being recorded today on Thursday, January 8, 2026. At this time, I would like to turn the conference over to the Sodexo team. Please go ahead.

Good morning, everyone. Welcome to our Q1 Fiscal 2026 Revenue call. On the call today is Sebastien de Tramasure, our CFO. After Sebastien's remarks, we will open the line to take your questions. We'll ask you to please limit yourself to 2 questions and one follow-up. Please get back to the IR team if you have any further questions after the call. With that, I'll now hand over to Sebastien.

Thank you, Juliette and good morning, everyone. I wish you all a very happy, healthy and successful 2026. And thank you for joining us today. So I will start this call with a brief look at our first quarter performance before I touch on our operational priorities and our outlook for the year, and then I will be happy to take your questions.

So in the first quarter of fiscal '26, Sodexo delivered revenue of EUR 6.3 billion. And this is broadly in line with our expectations. Organic revenue growth was 1.8%, while reported revenue were impacted by a negative 4% currency effect with a negligible contribution from acquisitions and disposal. So looking now at our performance by geography. In North America, our organic growth was minus 1.5%. This reflects several known factors, including contract exit in Education and Business & Administration last year, as well as a strong prior year comparison for Sodexo Live! as we had exceptional event activity in the first 2 quarters of last fiscal year. And these effects were partially offset by contributions from the new health care contracts we enter into the fourth quarter of last fiscal year. In Business & Administration, while we had anticipated a negative trend and due to the contract exit I just mentioned, I just mentioned, sorry, it was amplified by scope changes at a few larger accounts and to a lesser extent, by external elements linked to the U.S. government shutdown.

Meanwhile, Sodexo Live! performed slightly better than expected as the Mariner successful run in the playoffs provided a welcome boost with additional games at the T-Mobile Park having a positive contribution on revenue. In Europe, organic growth reached 2.4%. This was driven by new contracts in Business & Administration and Healthcare, which more than offset a high prior year comparable in Sodexo Live! linked to the Paralympics as well as softer trend in education, mainly reflecting contract exits. In the Rest of the World, organic growth was strong at just over 10%. This was driven by solid performances in Australia, supported by new contract and scope extensions along with good momentum in India and Corporate Services and in Brazil and Chile. Overall, across dynamic markets where we operate in this region, we are making significant progress with a robust growth coming from both new wins and from healthy underlying momentum on existing contracts.

Then from a strategic and operational perspective, as you know Thierry joined us as our new CEO in November. And as stated in the press release this morning is currently in an assessment phase across the business, spending a lot of time in the field with our clients, with our clients and with our team, sorry, and he will share his initial views at our half year results in April. And this will be followed by a more comprehensive assessment and planned before the summer break. In the meantime, we are not standing still on our near-term priorities are clear and execution is moving forward. And let me briefly update you on the initiatives we outlined at our full year. In the U.S., we are strengthening our sales organization. Our objective is to double the size of our North American sales team within 2 years. Since the beginning of this fiscal year, our sales force has increased by 20% with continued recruitment in priority segment. For example, we have increased the number of salespeople in our Education segment by 40%. And more broadly, over half our sales team have joined in the past 18 months, bringing in new talent and fresh energy.

We are also accelerating the time to productivity by strengthening onboarding and training, and by embedding AI across the sales cycle from prospecting to proposal development. On supply chain, we are redesigning our we buy food and moving to standardized ingredient level offers with common specs, so we can buy at scale and strengthen compliance through our digital tools. In the U.S., this new target operating model is already delivering tangible benefits in the first pilot sites. We are also rolling out our AI-based retail compliance tool. It's called Perfect Score. This is significantly improving planogram compliance. And these early results give us confidence as we scale the model across the U.S. portfolio through fiscal year '26. On ERP, India will go live in the second half of the year with our global finance and supply system. And in North America, deployment of the new food management system is now underway. Overall, this multiyear program remain key enablers of operational discipline and scalability.

On Global Business Services, progress continues. We have completed our large IT outsourcing program covering run activities for application and infrastructure. We are also expanding our shared service footprint and including the new Bogota Center, which now supports North America with close to 150 FTEs. And around 30% of North America sales support is now delivered through global business services, giving us access to more flexible and scalable support capacity. Overall, we have now over 1,000 people working across our 3 shared service centers, and we are accelerating the program with additional expansion to follow. So overall, we are progressing as planned on these key initiatives to strengthen the underlying foundation of our business. Turning now to our outlook and expected phasing effects for fiscal '26. We are reiterating our guidance framework with organic revenue growth expected between 1.5% and 2.5%. And our underlying operating margin is expected to be slightly lower than fiscal year 2025. In terms of revenue phasing, we expect the second quarter to be towards the lower end of the full year guidance range. And this will be followed by a gradual improvement in the second half, mainly driven by favorable comparatives and phasing of Sodexo Live!

On margin, so we usually see some seasonality with H1 being higher than H2. This year, the phasing will be different with H1 and H2 margin more closely aligned. This means that H1 will show a higher year-on-year reduction in margin. Three main factors explain this: First, the acceleration of the investment we started in the second half of last year; second, mobilization cost on our new large healthcare contracts; and third, the impact of negative organic growth in North America, with limiting operating leverage and a less favorable segment and contract mix. For fiscal 2026, we now expect other income and expenses to be around EUR 200 million compared to our initial indication of EUR 160 million. This increase mainly reflects additional restructuring costs related to organizational changes, acceleration in the Global Business Service program to push our competitiveness and some other one-off elements. Meanwhile, we continue to expect an M&A impact of revenue of 0.5%, net financial cost of around EUR 140 million and an effective tax rate of approximately 27%. And as usual, all the numbers are in the appendix of the slide deck.

So overall, our fiscal Q1 performance is consistent with our expectation. But let me be clear here, this does not reflect the potential we aim to realize for the company. We remain focused on execution, staying close to clients moving faster, focusing on growth and executing with more rigor and simplicity. And together with Thierry, we will provide more color on this in due course. With that, we'll open the call to questions.

[Operator Instructions]

First question is from Jamie Rollo, Morgan Stanley.

Two questions, please. First of all, it seems to be a little bit less disclosure than usual. I appreciate it's only the first quarter for sales only, but it would be great if you could please give us a general breakdown of organic sales growth between pricing, volumes and net contract gains for the quarter and also food versus facilities management?

And then secondly, Sebastien, I think you said that Q2 organic sales will be the low point. I think previously, Q1 was going to be the low point. Maybe I misunderstood that. But has anything changed at all there in the sort of cadence of sales during the year?

So thank you, Jamie, for your question. So first question on the bridge on organic growth. So 1.8% overall organic growth in Q1. Pricing is slightly below 2.5%. So again, in line with our expectations. The net new, it's a negative impact, again, around minus 1% and as expected and coming mainly from the net new from last year. And the like-for-like volume is slightly positive at circa 0.5%. And if you restate the impact of the Paralympics, overall, organic growth for Q1 is 2.1% instead of 1.8% and the impact of volume are at 0.8% instead of 0.5%. So on -- yes, on the phasing, so we are expecting Q2 again towards the low range of the guidance by the same expectation for Q1.

As you know, we'll have in Q2 initial impact of the contract reclassification, the large one we have in B&I in the U.S. This will impact around 60, 70 basis points in Q2. Then we will have the offset of the annualization of last year, major B&I U.S. losses which we have demobilized in during Q2. And this will create an easier comparison base for Q2. And again, as I said, we had in Q1 the impact of the Paralympics. And on your last topic on Food and FM, it's true that we did not disclose that in Q1. It's more or less at par, I would say, between Food and Facility Management, even if the full organic growth is affected obviously by the losses in University because in this segment in the U.S., it's mainly food.

Next question is from Leo Carrington, Citi.

Two for me. Firstly, large health care contracts that you referenced that are ramping up. We also saw the full outsourcing of the PEN health care contract. Are you seeing any acceleration in outsourcing in this sector than last year? Or is this activity increase phasing? And then secondly, just a follow up on those comments on organic growth acceleration. Is there anything that's happened since you last reported to give more comfort on this? Or as you say, is it mostly about the comp effects last year?

Okay. So there is a good momentum on the health care segment in North America, definitely with good development last year and good also pipeline and potential for this year. So it's true that the market remains very dynamic with a positive trend, underlying trend in terms of outsourcing in this segment. So for me, there is no major change here in the trend. But compared to prior years, but definitely, the trend is good. Then on the acceleration of the organic growth for H2, there is 2 -- again, 2 major impacts that we need to keep in mind for the second half of the year.

There is first, yes, the impact of, again, the reclassification of the large contract in Business and Administration that have a negative impact overall in the organic growth. And in the other hand, we have a strong different phasing and comparable for Sodexo Live! Last year, we had a very strong H1 for Sodexo Live!, a strong Q1 with Paralympics, with all the concert with [indiscernible]. Q2 was pretty good as well with the Super Bowl. So strong H1 last year. This year, we will have a much stronger H2 compared to H1. We'll have some big event schedule already during the second half of the year. One of them will be the World Baseball Classic Tournament. Here, it's mainly ticketing and travel and hospitality. As you know, this is an activity we have within Sodexo Live!. And on top of the additional event already scheduled for H2. We also had the ramp-up, a nice ramp-up within Sodexo Live!, especially in the U.S. from new contracts. We signed last year and recently, and one of them being also the [indiscernible] Lounges activity. We have also a new contract that I can mention with L.A. Music Center and all of that will bring also more organic growth, and will help for the acceleration of the organic growth in H2.

Next question is from Estelle Weingrod, JPMorgan.

First, I have a question on Europe and France in particular. Just wanted to check on the underlying momentum, any pressures on volumes or contract wins given the ongoing political uncertainty and macro headwinds, basically, how is it going on the ground? The second question I have is on North America Education. Just give us more color on how enrollment shaped up for you at the end in the full term? And how would you -- and when would you expect this division to regain momentum following new sales hires and so on?

And perhaps the last one on renewals for '26. I think last time you mentioned that there will be a few larger GSA renewals in the next couple of years with almost none this year. Just wanted to check if there was anything else to flag in terms of renewal for 2026.

So thank you, Estelle. On the first question on France, underlying momentum. Here in France, I mean, the trend, I would say, remain pretty stable. It's true that, again, overall, it's a tough context, I would say, but we see, again, same trend overall in all the different segments. We don't see any pressure, significant pressure in terms of volume. So as you know, France remains a very large and important market for us, and we don't see at this stage any big change in terms of underlying trends, it's a competitive market, but nothing new in terms of volume evolution.

On your second question regarding North America and the enrollment. So the environment in North America, higher education, it's in line with what I shared with you in October. Overall, there is a decrease. When we look at our portfolio of minus 0.7%, this was really, again, in line with our expectations. So -- and this has obviously an impact on our organic growth for the year, and part also the explanation of the negative organic growth in Education for Q1. And then on your last question about the pipeline of retention renewal. There is no -- as we mentioned, there is no very, very large contract, and it's a normal renewal cycle, even if, as you know, based on the average duration of the contract every year, it's a sizable amount of renewal at stake but nothing big, super big this year.

As we already said, there is no global account in fiscal year 2026 at a rebid phase.

Next question is from Simon LeChipre, Jeffries.

Two questions, please. First of all, coming back on the phasing for organic growth and the acceleration for H2. I mean I would assume pricing will further slow in H2. Also, you have this contract reclassification. So this is probably altogether more than 100 bps to offset compared with 2% underlying growth in Q1? And then when looking at the comps, it's not -- it doesn't look massively easier in H2. So what should drive the organic growth acceleration? Is it mainly a function of the annualization of the losses? Or is it the expectation of an acceleration in new business wins?

And secondly, relating to this, how is the pipeline of new contracts has evolved since October? Does it give you more confidence than that new business wins should accelerate through the year?

Okay. So coming back to the phasing. So what I said is that we have 2 major impacts in H2. The first one, as you mentioned, is really the impact of the reclassification of the large B&I contract. So this is a negative impact. And this impact is offset by the phasing and the much more favorable H2 for Sodexo Live!, as I mentioned before. Then you are right also to explain the slightly improvement of the organic growth over the year. There is other items. I mean first one is the annualization of the losses. As you said, the losses, some of them B&I, I have mentioned it that we demobilized in Q2 last year. So this will have, I would say, positive impact in H2.

There is also, I mentioned it, the good momentum in health care. So we continue to see a ramp up of new contract in health care during the second half of the year. And also in the second half of the year, we have a more favorable segment mix with a lower weight of education. So then on the pipeline, the pipeline remains solid and again, in line with what we are expecting. And what I can tell you on the pipeline and on the development, is that with the arrival of Thierry, we are really pushing the team on a much more commercial intensity. We are pushing the team on deal execution. There is a clear momentum here winning more and being more aggressive in the market to capture more sales and more development at this stage.

Next question is from Kate Xiao, Bank of America.

The first one is on retention rate. Can you kind of confirm whether the forward-looking retention rate is still stable at around 94% or is there kind of more recent contract losses that we should be aware of that could drive this a bit lower? My second question is on World Cup, which is a big event for Sodexo Live! in H2. I guess I understand that a number of players in the field are bidding for the contracts, including you guys. What is your understanding of the time line there? And what do you think is the total market opportunity there? And within that, what kind of level is the I guess, amount of contracts that Sodexo was bidding for?

So first on retention. So when we look at our forward-looking retention rate, it's broadly in line again with expectations at this stage of the year. So no big surprise in Q1. We had a few disappointments, nothing material in the context of the group. We also had very encouraging outcome. We managed to secure also a sizable contract during Q1. So overall, again, plus and minus, broadly in line with expectation. And then it's a bit too early then when we look at what we want to achieve during the year. Focus on retention is, again, key priority. We all know that this is really the first pillar for organic growth. But it's a little bit too early to draw a clear conclusion for the full fiscal year 2026.

But as I said, for this year, but not the case last year and 2 years ago, it's a more normal renewal cycle, and there is no major global account at stake for this year. Then on your second question on the pipeline, yes, so the pipeline for Sodexo Live! is good and there is some already secured events. The one I mentioned already, the World Baseball Classic Tournament is ticketing is for sure is there. There is more. It's still a tender and RFP process. But it's another opportunity here, we are quite confident. We also know that we'll have also the FIFA World Cup in the second half of the year. Again, all the tenders are underway. But we need to keep in mind that we are involved in 2 stadiums that we already operate. One is the [ Hard Rock ] Stadium in Miami. The other one is the BC Place in Vancouver. So we are in a good place there.

But again, we get the result of those RFP in the coming months, but it's definitely a very good opportunity for us, but it's a bit too early to comment on the financial impact.

Just a quick follow-up, if you don't mind. Are you also bidding for a new stadium kind of in the World Cup bidding stage?

Again, talking about ongoing commercial negotiation and bid, I cannot get into the detail. What I can tell you is that, yes, this is clearly a good opportunity for us, and we are clearly working on it.

Next question is from Jaafar Mestari, BNP Paribas.

I have 2 questions, if that's okay. Firstly, just on group margins in H1. I just wanted to clarify, you said H1 and H2 margins will be more or less aligned this year. Normally, it's at least 80 basis points difference between your H1 and H2. Is that the sort of order of magnitude of margin deterioration you're expecting in April? I mean unless you think margins improved year-on-year.

And then on North America B&I, you said you expected it to turn negative, but it was trending 4% organic in the last 6 months. Now it's minus 7.5%. It's a huge deterioration. I know there's government shutdown, which may be transitory. But on the rest, on the scope changes that you flagged, can you explain really behaviorally what's happening? What are clients saying? Are they giving services away to other providers? Are they just cutting services? I guess, in all cases, is that here to stay for the next 12 months before it starts to annualize? Or is there anything that's calendar that's one-off in Q1?

Thank you, Jaafar. So yes, on the margin, as I said, this year, we are expecting to have H1 and H2 margin more closely aligned. And we'll see a reduction in terms of margin on year-on-year compared to H1 this year to last year. And you are right overall on your number and here, it's really -- you understand the drivers here of the explanation of the reduction, again, as I said, it's really the acceleration of the investment, it's a mobilization cost for health care and also the fact that we don't have this leverage in terms of top line. And North America, especially North America, North America being our region with the highest profitability and the impact also in education in that education is also one of the segments with pretty good margin. Obviously, the change in the mix is impacting our margin for H1.

then on the B&I organic growth for Q1. So it's a mix. I mean the impact of the net neutral this what I have mentioned, it was clearly anticipated, super clear for us. Then there is also always a little bit of volatility on the facility management part. You could have some reduction of scope. This is clearly decision from the client. You also have some volatility in terms of project. In this case, it's impacting negatively North America in Q1. We're not expecting exactly the same trend for the coming quarter. It should improve there. And again, coming back on the volatility here, it's true that it's a negative impact in North America for B&I, but we had also a very positive impact in Rest of the World, for instance, with a very strong activity in Q1. And part of that is also due to more project work coming our IFM contract, especially in Energy & Resources.

So H1 margins, I mean, H2 margins were 4.2% last year. Is that the right order of magnitude for H1 margins this year?

But we are expecting margin. You have a guidance for the year. There is a market consensus. We are expecting margin to be aligned between H1 and H2, so that gives you your number.

Next question is from Karl Green, RBC.

Yes, just one residual question for me, please. Just wanted to clarify your comments about the ambition to double the size of the sales team. Can I just talk whether that was North America or globally? And I think you also mentioned around half of the sales team has joined in the last 18 months. Could you just give a little bit more detail about the kind of hiring criteria for those sales individuals, the sort of background levels of experience, et cetera?

Thank you. So yes, the number I shared with you in terms of the increase of the sales team is really for the U.S. at least objective, we have to double the size of our sales team for North America. We have clear priority here. One of them is really higher education. We spoke about that. We need to strengthen the team in this segment with strong potential. It's also on account management as well where we really need to strengthen the team as well. So this is really part of the play, part of the plan, sorry, to really strengthen activity there. And then in terms -- yes, in terms of background, in terms of salespeople. Well, here, again, it's true that 50% of our existing sales team is coming external.

I think it's important for us to bring also a new talent within the company. It needs to have also fresh eyes and new level of energy. It's exactly what we want to do. Then in doing that, we also need to work on the onboarding, on the training. So it's true that then it takes a little bit more time to see tangible results. So we will not improve development there in next quarter. But what is super important is that we are really preparing this acceleration of the development of the growth is bringing this new talent and the new sales team within the organization.

That's helpful. And if I can be cheeky, could you give an approximate indication of how many sales people -- sales and marketing people you now have in the U.S., please?

So what we said, again, for competitive reason, we are not sharing the absolute number in terms of sales team. But what I can tell you again is really that we need to increase the team and it's clear in terms of objective with doubling the size, and we have been progressing well in this objective.

Gentlemen, there are no more questions registered at this time.

So thank you for joining us today. Again, looking forward to speaking with all of you again for the half year results in April. And as I said, Thierry will be with us for the H1 results. So thank you again, and have a great day.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

In the name of the whole team. I'd like to wish you welcome. As you know, Sodexo Live operates this wonderful place, which was opened in April 2017. Siene Musicale is an auditorium. It's a huge thing. 35 studios for practice. Our teams are in charge of the commercialization of the spaces, welcoming production, safety, security, and maintenance, as well as restaurant services. Please look at our programs.

Let me cite a few shows that are currently being run. original creation, the ran by [ Marco Casowitz ]. There's still a few dates available starting on the 4th of January. Nutcracker suite by Tchaikovsky from the 7th to the 8th of January or... [ STING ] Musical, the first in France starting on the 18th of February.

Ladies and gentlemen, before we start our general assembly. I'd like to remind you a few important bits of information for your event. In case of a fire alarm, we invite you to go back to -- from the emergency exits that are located on either side of the stage. If you need to, we will also inform you that the physician is present on site. And lastly, to conclude, I'd like to invite you to make sure that your telephones are off or on airplane mode.

In the name of the whole team at the Siene Musicale, I would like to wish you a wonderful general assembly. Thank you.

Ladies and gentlemen, dear shareholders, good afternoon to everybody. Welcome to La Seine Musicale. It's a great pleasure to meet you in this exceptional place again this year for our Annual Shareholders' Meeting. I'm speaking to you today alongside Thierry Delaporte, who is our Chief Executive Officer. He's been the CEO since the 10th of November; Sebastien De Tramasure, our Chief Financial Officer; and Florence Negrel, who is Secretary of the Board of Directors, who is handling the General Meetings Secretarial duties.

I would also like to inform you of the presence of the general meetings to scrutineers. François-Xavier Bellon, who represents the holding company, Bellon SA; and Jean-Michel Cayol, who represents FCPE Groupe, Sodexo Peps, one of the mutual funds for Sodexo employees. Who are the shareholders with the largest number of votes having accepted the role of scrutineer.

I will now officially open this annual meeting, of which I am the Chair as Chairwoman of the Board of Directors of the company. The members of the Board of Directors and Sodexo leadership team who could attend are also present, either physically in this room or remotely.

The audit firms Ernst and Young Audit, represented by Madam [ Sara Ganem ] and KPMG, represented by Mr. Nicholas Chy will share their reports with us during this meeting.

I would now like to hand the floor over to Florence Negrel. Now she's the meeting secretary, who will present the agenda.

Thank you, Sophie. Hello, everybody. I'm delighted to be with you as secretary for this meeting. First of all, I'd like to remind you that this shareholders' meeting will be held in French and that simultaneous translation in English is also available.

As usual, this meeting is also accessible to the deaf or hard of hearing, thanks to sign language interpreters. I also remind you that this meeting is being broadcast live from our website www.sodexo.com, and will also be available for replay in the coming days.

I inform you that the number of shares mentioned on the attendance sheet in the name of the shareholders present, represented or having voted by correspondents amounts to 126,690,573 shares. That's 87.24% of the shares bearing voting rights. The legal quorum is 36,306,708 shares. So the shareholders meeting, therefore, can deliberate validly. If fleet commerce come to attend the meeting before 4:15 p.m., this provisional quorum will be modified, and the final quorum will be taken into account when we vote upon the resolutions.

I have before me all the documents which attest to the regularity of the convening and the deliberations of this meeting. And also the documents that must be made available or communicate to shareholders have been made so under the legal conditions and deadlines. Please also be informed that [ belif ] is present here in the room.

The agenda of the shareholders' meeting, as well as the draft resolutions were presented in the preliminary notice of meeting published on October 31, 2025, in the French BALO publication. The notice of meeting was published in the BALO and in journal of legal announcements on November 20, 2020. Please note that following the publication of the preliminary notice of meeting, [ the ] request with the inclusion of points or draft resolutions on the agenda has been submitted by the shareholders.

As usual, in the interest of the debate, we propose that you exempt the Chairwoman from the exhaustive reading of the Board of Directors' report. The full report can be found in the fiscal 2025 universal registration document available on our company's website. And its main elements will be presented to you during the shareholders' meeting.

I now give the floor to Sophie Bellon, Chairwoman of the Board of Directors.

Dear shareholders, dear Board members, dear colleagues, dear friends of Sodexo. The year 2025 was marked by significant progress and many challenges. It also marks the end of a cycle of profound transformations that began in the aftermath of COVID with the ambition to reposition Sodexo as a pure player in food services and facilities management. This objective required numerous structural changes aimed at building a stronger Sodexo. We've streamlined our portfolio, divesting our child care and home care services followed by the successful spin-off of Pluxee in 2024.

Today, Sodexo operates in 43 countries where we have strengthened our presence through acquisitions in key markets notably in China in 2024 and in Spain this year with Grupo Mediterranea. This acquisition will allow us to double our size and strengthen our positions in key segments, particularly in Corporate Services in health care and in education.

Food services now represent 66% of our portfolio compared to 62% in 2022. We have modernized our offers, leveraging our consumer insights and enhancing the culinary digital and sustainable dimensions of the experience that we provide. Our food offers such as Modern Recipe now account for more than 50% of revenue compared to less than 20% 3 years ago. With nearly 6 million active consumers on our digital ecosystems up from EUR 1.2 million in 2022, we have a more direct and personalized relationship with those we serve. Improving their experience is at the heart of our strategy, and I'll come back to that.

To drive greater efficiency, we have reshaped our organization so that P&L accountability now sits at the regional and country levels. At the same time, we've transformed our operating model. This has resulted in significant progress in supply chain management with compliance with food catalogs rising from less than 70% in 2022 to 78% in 2025.

On the technology front, we have once again invested EUR 500 million this year in data and digital tools. Artificial intelligence is now embedded across all our operations from kitchen management to procurement and workforce planning, thanks to attendance forecasting at our sites. While enhancing our efficiency, we're enabling our teams to focus on what matters most. That is culinary excellence and the quality of the experience that we offer our guests.

Finally, our shared service centers in Porto, Mumbai and Bogota the efficiency of our support functions, while more than 40 standardized processes have improved service quality throughout the year. All the progress we've made this year has also enabled us to strengthen our positive impact and consolidate our leadership in sustainability within our sector. Our ongoing focus on employee safety is reflected in the historically low lost time injury rate of 0.45 in 2025 compared with 0.65 in 2022. Continuing our efforts to get even closer to zero accidents is an imperative for all of us.

Our commitment to an inclusive environment remains unwavering. For example, 42% of Sodexo's senior executives are women. Our global benefits program, Vita, is now effective in more than 70% of the countries where we operate. We're also committed to developing our talent, and we've increased the average number of training hours per employee by 5.1%, now reaching 12.4 hours per year. Nothing would be possible without the constant commitment of our teams around the world, which we measure every 2 years in our voice survey. I remind you that we were the only ones in our sector to do so. And this year, again, it reached a rate of 80%, demonstrating the relevance of the employer policy that we're developing.

Finally, on the environmental front, 2025 marks the successful completion of our sustainability road map. That's better tomorrow. Thanks to the mobilization of our team, significant progress has been made in reducing our carbon footprint promoting healthy and sustainable leading, developing local partnerships, responsible sourcing and fighting food waste.

As an illustration, I'm proud to announce that we've exceeded our greenhouse gas emissions reduction target that scopes 1 and 2 with minus 37.7% compared to 2017. With our new "Better Tomorrow 2028" road map, we are now entering a phase of acceleration. Our ambition is to further integrate sustainability at the heart of our operations at every site, in every action of our 426,000 employees. Because it is they who every day in the field work to improve the lives of millions of consumers and support our clients in their own sustainable transition.

Let's look at this in more detail now with the video.

[Presentation]

In 2025, we also continue to invest in our commercial strengths, notably through strengthening our teams, deploying training programs and new motivation and recognition schemes for our salespeople.

In both development and retention, we achieved encouraging successes this year. including GSK, MSD, AtlantiCare, [ U.S ]. Health, the schools of Marseille, [ Santos ] as well as the next ree Rugby World Cup, Men's and Women's and the [ Todos ] with Sodexo Life.

Finally, our net growth is positive again, which was not the case in the pre-COVID years. Thus, despite the demanding economic and geopolitical context, these transformations have paid off, and our trajectory of profitable growth is confirmed.

In 2025, our revenue reached EUR 24.1 billion, up 1.2% driven by organic growth of 3.3% or 3.7% on an underlying trend. Our underlying operating margin increased by 5% and by 10 basis points at constant exchange rates to 4.7%. Our business development amounted to EUR 1.7 billion, with a very strong first half followed by a more moderate second half. Underlying organic growth increased by 3.7% to EUR 785 million, our adjusted net earnings per share of EUR 5.37.

On this basis, as [ in ] line with Sodexo's 50% distribution policy, the Board of Directors proposes an ordinary dividend of EUR 2.70. You will be able to vote on this proposal during the resolutions. Our Chief Financial Officer, Sebastien De Tramasure, will present the details of our financial performance in just a moment.

2025 brought challenges also for our group. The results of this [ you ] reflect both the progress made and the operational challenges that we faced, particularly in the United States. These have affected Sodexo stock market performance and Sebastien will return to this in a moment. Nevertheless, we have many reasons to be confident about the future.

We operate in a global outsourced food services market that is vast, resilient and growing. It amounts to EUR 300 billion worth 10x our size with immense potential, since 50% of this market is still self-operated. Sodexo has strong assets to capture part of this market's growth. Its financial independence, diversified geographical presence, strong values, recognized ethical principles, leadership and sustainability, and a mission driven by the commitment of its 426,000 employees.

With these solid foundations, we're ready to open a new chapter focused on commercial acceleration and operational excellence. Our ambition is clear. We want to be the leader in food and services, shaping better everyday experiences at every moment in life. Concretely, this means continuing, as I mentioned earlier, our investments in improving the consumer experience. For example, by strengthening our value proposition for employees in the workplace, developing new culinary concepts in line with consumption trends and continuing to deploy technologies that improve the guest journey.

In health, education, the workplace or sports and leisure we continue this momentum, always mindful of our commitment to have a positive impact on people and to progress with purpose in line with the mission defined for our group nearly 60 years ago now. Shipping better everyday experiences is indeed our ambition.

I'd like to invite you to watch a video that demonstrates this.

[Presentation]

A new chapter is opening now for Sodexo. This new phase of our development will be led by Thierry Delaporte, who joined us as Group CEO on November 10. Thierry brings solid experience to support Sodexo in this new stage. He fully embodies the human values at the heart of our identity and to which we will always remain faithful. I'm convinced that our new governance structure will strengthen us and make us more efficient. And I have full confidence in Thierry's leadership to guide the next stages of our growth and write a new page in Sodexo's history.

As Chairwoman of the Board, I will now devote all my energy to leading the Board and its committees and to maintaining strong and sustainable governance. With my family, we remain deeply committed to Sodexo's financial independence and to preserving the long-term vision desired by our father, Pierre Bellon. Our shared ambition will be to sustainably support the group's growth, the margin improvement and the market share increase and to strengthen also our positive impact.

Before handing over to Sebastien, I'd like to express my sincere and warm thanks to all of our employees. Throughout this year, they've mobilized to support our clients, our consumers and our partners in an increasingly complex and demanding environment. I see it day after day. And on each of my visits, I see their commitment, their passion and their spirit of service that are the driving force behind our collective success. I'd also like to thank our clients, our partners around the world and, of course, our shareholders for their trust, their support and their loyalty.

As Sodexo approaches its 60th anniversary, it has strong fundamentals. More than ever, we're ready to continue our growth and innovate and keep shaping the future of food services and facilities management. Thank you for your attention.

Ladies and gentlemen, dear shareholders, I am pleased to present you the financial highlights for fiscal year 2025, which ended on the 31st of August. For the full year, the consolidated revenues reached EUR 24.1 billion, representing organic growth of 3.3%. This growth rises to 3.7% when excluding base effects from the previous year, which was marked by major sporting events and a leap year.

The underlying operating margin stands at 4.7%, up 10 basis points at constant currencies, driven by procurement efficiencies, benefits from the implementation of our shared services centers and operating leverage from higher revenues, which offset investments made to support growth. Underlying net profit reached EUR 785 million or an increase of 3.7% at constant currencies.

Free cash flow totaled EUR 459 million, helping to maintain the net debt to EBITDA ratio at a moderate level of 1.8x within our target range of 1 to 2x. The Board of Directors will propose a dividend of EUR 2.70 per share, a slight increase from last year, in line with our policy of distributing 50% of underlying net profit. All of our geographic regions contributed to the group's growth.

North America, representing 46% of group revenues, delivered organic growth of 2.8% supported by price increases, a strong momentum in Sodexo Live and the corporate segment, but impacted by contract losses in education. In Europe, accounting for 36% of group revenues, saw organic growth of 1.7% or 2.7% when excluding the impact of major sporting events in 2024. As to the rest of the world, which represents 18% of revenues, recorded organic growth of 7.5%, with excellent performance in India, Australia and Brazil, where we are gaining market share.

On margins in North America, the underlying operating margin was stable at constant currencies, standing at 5.8%. In Europe and the rest of the world, margins increased by 20 basis points at constant currencies, reaching, respectively, 4.3% and 4.9%.

After analyzing the operating performance, let's move on to our financial position and our balance sheet to continue investing in our strategic priorities. Free cash flow generated was EUR 459 million, including an exceptional outflow of around EUR 160 million related to the finalization of the Sodexo SA tax audit.

Excluding this one-off item, the cash conversion remains very high, standing at 91%. As of 31st of August 2025, the net debt stood at EUR 2.7 billion with a net debt-to-EBITDA ratio of 1.8x within our target range of 1 to 2x. We continued proactive debt management with the early repayment of a EUR 700 million bond in April and the issuance of a new USD 1.1 billion bond. In May, these operations extended our average maturity and preserve our financial flexibility. Our balance sheet remains solid, enabling us to keep investing in our strategic priorities while maintaining disciplined capital allocation.

In this slide, we are presenting you with our proposal for dividends from 2025, as well as changes in the share price for 2025. The proposed dividend for fiscal '25 is EUR 2.70 with a payout ratio remaining at 50%, as is our usual policy. In addition to the ordinary dividend, EUR 2.65, we paid an extraordinary dividend of EUR 6.24 per share, redistributing the entire proceeds from the sale of Sofinsod–Bellon SA.

In fiscal 2025, the share price declined by 36%, while the CAC 40 Index rose by 1%. This evolution mainly reflects the drop in March after our guidance revision followed by the adjustment period through to the end of the year. we naturally understand the questions raised by the current share price level. Our priority remains operational performance and sustainable value creation.

This last slide summarizes our fiscal outlook for the upcoming year and our approach to capital allocation. For revenues, we anticipate organic growth between 1.5% and 2.5% with an operating margin slightly below that of 2025. This reflects our decision to accelerate investments to strengthen the group's foundations, especially our sales forces and systems.

Our ambition remains to bring CapEx to around 2.5% of revenues mainly in order to support client investments, particularly in the most complex contracts and to continue investing in systems and technologies. We also aim to maintain our financial leverage with a range -- within a range of 1.2x EBITDA to ensure a solid balance sheet.

Regarding the dividend, we confirm our policy of distributing 50% of underlying net profit. Our M&A strategy remains focused on small- and medium-sized transactions with an average budget of around EUR 300 million per year to support our development while maintaining strict financial discipline.

In summary, we continue to follow a balanced approach investing for growth and competitiveness while preserving our financial strength and ensuring regular returns to shareholders. Sodexo enters fiscal 2026 with a solid financial base, enhanced execution discipline and a targeted investment plan to support strategic priorities. I would like to thank all teams for their commitment and professionalism and you, share shareholders for your trust. Thank you for your attention.

Ladies and gentlemen, a little over a month ago now, Thierry Delaporte joined our organization as Group Chief Executive Officer. Through numerous meetings, there are teams and clients, he's already begun to immerse himself in our culture, our challenges and our priorities. It is with great pleasure that I invite him to speak for the first time before our assembly. Thank you. Over to you.

This is Chairwoman, members of the Board of Directors. Dear shareholders, ladies and gentlemen, it is a true honor to address you today for the first time as Chief Executive Officer of Sodexo. And I do so with great humility.

Joining Sodexo, a group with a unique history, a French flagship and a world leader in food services and facilities management is both a privilege and a great responsibility. So Sodexo is a company whose values and commitments resonate deeply within me. From my very first interactions with the group, I felt their strength. The teams I have met, everywhere where I've gone embodies these values.

I've spoken with many clients who fill them in every interaction. This is also the legacy of Pierre Bellon, the founder of Sodexo. I would like to acknowledge his human and entrepreneurial vision which continues to inspire our employees' actions every day. His book to serve and to grow remains a true compass serving our clients, helping women and men to grow and contributed positively to society. This legacy guides us. It remains a foundation upon which we will build the future. I warmly thank Sophie Bellon, the Board of Directors and the Bellon family for their trust.

A few words now about my background. I've had the opportunity to live and work in Europe, Asia, Australia and North America for 14 years. I've worked with high-growth industries, where people are at the very heart of priorities. Services first, at Capgemini for more than 20 years than at Wipro, an Indian digital services group.

In these global companies undergoing major transformation, I learned that performance always relies on three key aspects. First of all, customer obsession. The customer has to be at the very heart of all of our decisions. We correspond to the expectations innovating at their side. It is by cultivating this proximity that we create value and that we build a relationship of trust over the long haul.

Secondly, constant investment in developing our teams giving them the means to make progress to commit and to exceed themselves. This is absolutely indispensable condition for excellence that our customers are expecting from us.

And lastly, rigor and discipline acting within a demanding way quickly in a determining fashion is to transform challenges into performance and to enroll our performance in the long haul. In each of my travels in the last weeks were in Hong Kong and the U.S., in Spain, in France, in Great Britain. I witnessed the same energy, commitment and pride across our teams and partners. Same pride.

Our customers see us as a trusted partner committed, attentive and able to create solutions tailored to their needs. I have also witnessed Sodexo's societal impact. We're working one of the most human professionals -- professionals there is, nourishing, supporting and improving the everyday experience. I'd like to salute as well the transformation and progress made in recent years in an environment marked by profound economic social and geopolitical changes. My priority is clear, to enable Sodexo to continue and to amplify its value creation for their shareholders and all stakeholders.

My actions, we'll focus on three areas. First, further strengthening our customer focus and accelerating the conquest strategy in any new market. Every decision should start with one question. What value does this bring to our clients? Next, improving our operational efficiency and talent. Our force depends on the quality of our commitment and the commitment of our teams. All customers that I met said the same thing, developing staff is at the heart -- our difference in our performance.

Lastly, accelerating with determination our operating model to make it ever and ever more adaptable and agile. Sustainable performance of the company [ been ] expected by our shareholders. To move forward in this direction, I believe in something very simple. Listening to teams, understanding their realities and acting alongside them. It is in that spirit our -- I wish to emerge myself fully and I'm going to take over the direct responsibility of North America for a certain amount of time.

I have a great ambition for Sodexo because I'm convinced of our potential. We must become the global reference in our field. The path will be demanding, but we have the ability to meet challenges, to anticipate changes in our environment, and to continue to progress time and again. Thank you for your trust. Thank you for your commitment. Let's write together this new chapter in Sodexo's history.

Thank you. Thank you, Thierry. Thank you for this first message. We now come to the presentation of our corporate governance.

First of all, I would like to express my sincere gratitude to the members of the Board of Directors for their work, their commitment, their invaluable support. And once again, to acknowledge the collective intelligence that drives the Board. The Sodexo Board of Directors, which I have the honor and pleasure to chair is at the end of fiscal 2025 composed of 12 members, including 6 independent directors and 2 directors representing employees, and 4 representing the family.

The proportion of independent directors stands at 60%, well above the 30% required by the [ FF MEDEF ] code for a controlled group. The Board's composition reflects the group's values with gender balance in line with best market practices and international profile with four nationalities represented and the complementary mix of experience and expertise that enables us to address all the challenges that the group phases. You'll find the full details of all the topics discussed in the [ addressed ] by your Board in Chapter 7 of the Universal Registration Document.

And I'd like to just give you a brief summary of this. The Board met 9 times with an attendance rate of 99%. Thank you to our Board members. It's work focused in particular on the renewal and selection of directors. My succession plan as Chief Executive Officer, the review and definition of executive compensation policies, the monitoring of the group strategy and reviewing its various activities across all geographical regions and strategic opportunities. Also overseeing the implementation of the CSRD reporting and, of course, reviewing and approving the financial statements, as well as all matters related to monitoring the group's financial performance.

Let me also remind you that in making its decisions the board relies on the work of its four specialized committees, which are responsible for making recommendations and each committee is chaired by an independent director. During fiscal 2025, the Audit Committee chaired by Jean-Baptiste de Chatillon, notably review the financial statements, monitor the group's financing, establish the risk mapping oversaw the group's nonfinancial reporting obligations and the implementation of CSRD reporting and ensured the review of the auditor's independence.

The Sustainability Committee chaired by Véronique Laury was created during fiscal 2024. It focused closely on the review of the "Better Tomorrow 2025" plan. the implementation of CSRD and the development of our new sustainability road map, which is "Better Tomorrow 2028". It also reviewed the Stop Hunger program and the responsible purchasing policy.

In addition to our joint meetings with the Audit Committee and the Compensation Committee on cross-functional topics. During the year, and in addition to matters relating to the renewal and appointment of new directors, the nominating committee chaired by Gilles Pélisson focused, in particular, on my succession plan and the recruitment of our new Chief Executive Officer.

Finally, the Compensation Committee chaired by Cécile Tandeau de Marsac focused, in particular, on defining the compensation policy, reviewing the free share and performance share plans and confirming the delivery of the 2022 allocation plans. It also played a key role in matters relating to the compensation of executive officers as part of the succession plan and the separation of the roles of Chairman of the Board and CEO.

I will now hand over to Luc Messier, who as Lead Independent Director during fiscal 2025 will present an overview of his work during the year. And the key decisions that have reshipped our governance.

Ladies and gentlemen, shareholders, Board members, employees of Sodexo. It is a great pleasure for me to speak today and share with you an overview of my work during fiscal 2025 and to take this opportunity to revisit some of the changes made to our governance, namely the reasons behind the separation of the rules of Chairwoman of the Board and CEO and the decision to maintain the role of Lead Director despite the separation.

As you know, the role of Lead Director is to ensure the independence of the Board and in this capacity to be consulted on the agendas of Board meetings to organize executive sessions to maintain dialogue with our main shareholders, investors and proxy advisory firms and ensure the prevention of conflicts of interest and safeguard the independence of the Board's decision-making. To ensure a full oversight of the Board's activities,

I'm a member of the Audit Committee, the Nominating Committee Sustainability Committee. And I also attend the meetings of the compensation committee, the only committee, of which I'm not a member. By contributing to the committee's discussions, on governance matters, I have been closely involved in the recent governance changes, which stem from the Board's reflections and the work of the nominating committee during fiscal 2025. Throughout the year, the Board's activity has been particularly rich and intense. And I would like to thank all directors for their full commitment.

As Lead Director, I have monitored the follow-up actions taken based on the Board and committee evaluations carried out in 2023 and 2024, which notably led to holding a strategic similar in the United States, organized around workshops, site visits and expert presentations in developing a training plan for directors, covering governance, sustainability and cybersecurity, including two sessions dedicated to sustainability issues and the new internal evaluation of the Board and its committees work.

I also organized three executive sessions following Board meetings, as well as a fourth at the end of the strategic seminar in the United States, part of which was held exclusively amongst independent directors. As your point of reference on governance matters and as a member of the Nominating Committee and the member of the Nominating Committee, I'd like to revisit the separation of the roles of Chairwoman of the Board and CEO and the recruitment of Thierry Delaporte. The Board considered that after the ball structural changes, courageously taken by Sophie Bellon in the last years, such as the spinoff of proxy and the sale of Sofinsod to Bellon SA, the time had come to strengthen Sodexo's leadership for a new phase of growth and development.

The recruitment process for the new Chief Executive Officer was led by the Nominating Committee chaired by Gilles Pélisson. This process began several months ago and involved all members of the committee, the Chairwoman and CEO the independent directors and the Bellon family members. I would like to thank them all for their availability and unwavering commitment during this period. this process.

This process, which began several months ago, resulted in a unanimous decision by the Board of Directors to dissociate the function of Chairman of the Board and General Director. And by dissociating the function of Chair of the Board, the Board of Directors by a decision which was unanimous, wish to on the best standards of governments to maintain the function of Lead Director of an independent lead director.

I therefore handed over this role to Gilles Pélisson, who succeeded me as Lead Director on November 10. Thank you for your attention. And then I give the floor back to Sophie Bellon.

Thank you, ladies and gentlemen. Dear shareholders on my own behalf and on behalf of the Board, I'd like to thank Luke for his valuable and essential contribution to Sodexo's governance as Independent Lead Director since March 2022. Luc, thank you very much.

Now as our custom, I invite you to welcome Cécile Tandeau de Marsac, so she may present you with a summary of the compensation committee's work.

Hello, everyone. I'm pleased to be with you today to present the work carried out by the Compensation Committee. During fiscal 2025, in addition to its usual topics, the Compensation Committee focused in particular on the impact of the succession plan for the Chairwoman and CEO, and on the decision to dissociate the rules of Chairman of the Board and Chief Executive Officer.

This year, six resolutions relating to the compensation of corporate officers are being submitted for your approval. For each one, I'll briefly review its components and focus also on highlighting the proposed changes, which, as you will see, largely stem from the dissociation of rules. The compensation elements received by the Chairwoman and CEO for fiscal 2025 are in line with the compensation policy approved by shareholders at the 2024 Shareholders' Meeting.

This compensation consists of fixed remuneration of EUR 900,000, a variable remuneration and a long-term remuneration, which I will detail shortly. It also includes benefits in kind amounting to EUR 1,431. Regarding variable compensation for fiscal 2025, the achievement rate stands at 41.5% of the target variable remuneration, representing an amount of EUR 448,200. This achievement rate reflects the demanding nature of the objectives set by the Board of Directors.

As a reminder, these objectives were defined by the Board in October 2025, and were not revised during the year in line with the policy. As you can see, the targets were ambitious, and the financial objectives relating to organic revenue growth, client retention, operating margin and group net profit or not met. The objective for cash flow generated by operations was largely achieved, demonstrating rigorous cash management.

As for the achievement of nonfinancial objectives, which account for 30% of the targets, health and safety objectives partly achieved. The go linked to the near misincident rate, the NMI or aimed at fostering a culture of accident prevention, and that was largely met. Although this excellent result contributed to a further 4% reduction in the lost time injury rate, the LTI or, as we call it, it was not sufficient to meet the very ambitious target of a 17% reduction that have been set. The sustainability objective achieved as measured by the deployment of the internal food waste monitoring program, WasteWatch. This, therefore, was achieved. This program now covers nearly 85.4% of the cost of food stuff, food raw materials.

Finally, the talent management objective, which consists of two indicators relating to the group's senior executives, the rate of departures considered regrettable and the gender balance in operational positions, this was achieved. I would also like to remind you that the acquisition of annual rights under the supplementary pension plan is subject to achieving a minimum annual bonus attainment rate of 80%. Therefore, Sophie Bellon does not require any entitlement to a lifetime retirement pension for fiscal 2025.

In addition, regarding long-term compensation, the Board of Directors granted 40,000 performance shares to Sophie Bellon in accordance with the compensation policy for fiscal 2025. The performance conditions of the plan aligned with the 2025 strategic plan are displayed here on the screen.

At the grant date, these shares were valued at EUR 1,589,360. This grant represents 80% of the target annual fixed and variable remuneration below the target level for free share award set out in the policy and down 20% compared to the grant for fiscal 2024. The Board of Directors consider the recent evolution of Sodexo's share price and reaffirmed the importance of maintaining a rigorous and balanced approach in determining the grant.

The compensation policy for corporate officers for fiscal 2026 is consistent with the 2025 policy. It's a continuum aiming to strike a balance between short-term and long-term performance. The compensation policy applicable to Sophie Bellon is divided into two periods from September 1 to November, the 9 inclusive. Sophie Bellon served as Chairwoman and CEO; then she became Non-Executive Chairwoman of the Board on November 10, 2025.

Similarly, the compensation policy applicable to Thierry Delaporte part is divided into two periods. From this appointment on November 1, and following this shareholders' period. That's this shareholders meeting. That's the second period. So regarding the compensation policy applicable to the Chairwoman and CEO from September 1 to November 9, 2025 inclusive, the policy remains unchanged from the previous compensation policy approved at the shareholders' meeting on December 17, 2024. It will apply on a pro rata basis.

Furthermore, Sophie Bellon will not receive any grant of free performance shares for fiscal 2026. Regarding the compensation policy applicable to the nonexecutive Chairwoman, it reverse to the policy that Sophie Bellon received 4 years ago. That is before she assumed the role of Chief Executive Officer, namely an annual fixed remuneration of EUR 675,000, which will be paid on a pro rata basis. This amount was in fact the same as what Sophie Bellon had received since 2018, no variable remuneration of granted free performance shares coverage under the welfare and health insurance plan and a company car.

Regarding the compensation policy for the Chief Executive Officer, I would like to point out that it has been defined in line with Sodexo's existing policy. The peer groups used to determine the CEO's compensation policy have remained unchanged. The annual variable component equals 120% of fixed remuneration when targets are met and can reach up to 170% in the event of outperformance or overperformance. That's been our policy since last year.

As for fixed remuneration for the period from November 1 to December 15, the fixed remuneration remains at EUR 900,000. No change. And subject to approval at today's shareholders' meeting will increase to EUR [ 1,150,000 ] with these amounts applied on the pro rata basis. Ultimately, the CEO's overall compensation, consisting of fixed remuneration and annual variable remuneration and the grant of performance shares is largely based on variable components subject to demanding performance conditions.

The fixed portion of the remuneration, thus represents only 23% of the target package and 17% in the case of outperformance. The amount of this remuneration falls between the median and the upper quartile of the peer groups in line with Sodexo's positioning within these panels. Regarding the objectives for annual variable remuneration, the client retention objective has been replaced by the criterion of net sales growth in order to better capture the dynamics and the overall commercial performance. They have a safety criteria has also evolved in favor of more mature indicators. The total recordable case rate, the TRCR replaced the lost time incident rate, LTIR, and the number of safety visits carried out and recorded replaces the new MIR incident ratio.

To take into account the change in governance on this transitional year, our qualitative criterion representing 20% of the nonfinancial objectives has been introduced. The Board of Directors will thus have the flexibility to assess Thierry Delaporte's strategic choices in all the dimensions. In particular, regarding the turnaround of the North America region, Investor Communication, managerial transition and the effectiveness of implementing Sodexo's operational strategy in line with the group's strategic pillars through 2028.

Regarding the other compensation elements, Thierry Delaporte will receive some that will remain unchanged. They will consist of the at least the elements will remain unchanged. The assume will consist of the grant of free performance shares with acquisition measured over 3 years and subject to the achievement of performance conditions a supplementary pension plan, collective welfare and health insurance plans and a benefit in kind, which is, in fact, a company car. It should be noted that no sign on our relocation allowance was paid upon Thierry Delaporte's appointment as Chief Executive Officer.

Now let us turn to the remuneration of directors. As a reminder, the total annual amount that may be allocated to Sodexo directors is EUR 1.3 million. It's been that some since 2024. The scale for fixed and variable remuneration of directors applicable in 2026 remains unchanged. The only change is the increase in the flat travel allowance paid to directors residing in North America from EUR 1,500 to EUR 4,500. This allowance is paid for each actual attendance at the meeting of the Board of Directors.

To conclude, I'd like to thank all the members of the Compensation Committee for their active participation and unwavering commitment throughout the past year. I also like to invite you to consult the Universal Registration Document for fiscal 2025 for more information on the compensation of corporate officers. Thank you for your attention.

Thank you, Cécile. Ladies and gentlemen, before we continue and because they will step down from their roles as directors at the end of this Annual Shareholders Meeting. I'd like to warmly thank on behalf of the Board and myself a couple of people.

Firstly, Cécile Tandeau de Marsac for her unwavering commitment and invaluable contributions over 9 years of service. Dear Cécile, you've successfully taken on the roles of Chairwoman of the Nominating Committee and Chair of the Compensation Committee at a decisive time for the group. A group and a team that you have guided through the COVID crisis and through its transformation also notably with the spin-off of Pluxee. Your sound advice and energy were critical at these key moments. And this year again, you remain fully engaged until the very end. Thank you.

I'd also like to thank Véronique Laury, who couldn't join us today, but who has served as a director for 6 years and as Chairwoman of the Sustainability Committee since its creation in 2024. Dear Véronique, your work and setting up this committee and reviewing all the CSRD related matters has been outstanding as has your broader contribution to the Board's work. I'd like to express my heartfelt thanks. Thank you.

At this Annual Shareholders Meeting, we're proposing the appointment of two new directors. [ Genevieve Bish ], they're with us here today, by the way. Genevieve Bish and Francois [indiscernible], whom I warmly thank for joining us. Let's watch a short introduction video of Genevieve Bish.

[Foreign Language]

Thank you, Janie. We've also asked Francois to introduce yourself and here is her video.

[Foreign Language]

Thank you to both of you for these fun videos. Ladies and gentlemen, as Patrice de Talhouët term is coming to an end, we're proposing to evolve our governance and to appoint Bellon SA, the holding company and controlling shareholder of Sodexo as a new director. In this context, Bellon SA would designate Mr. Patrice de Talhouët as Managing Director, as its representative allowing him to continue to bring his expertise and strategic vision to the Board.

Finally, we invite you today to renew Luc Messier's term as an independent director. Ladies and gentlemen, to give you a complete overview of the changes to your Board and subject to the approval of the resolutions you will be voting on shortly. Adjustments will be made to the composition of the specialized committees.

For example, Geneveieve Abish will succeed Cécile de Marsac as Chairwoman of the Compensation Committee. And Luc Messier will succeed Véronique Laury as Chairman of the Sustainability Committee, which will then have five members compared to seven previously. Patrice de Talhouët, representing Bellon SA, we joined the Audit Committee, along with Francois [indiscernible]

Dear shareholders, we will now give the floor to the statutory auditors so that they can present to you the -- their different reports. Madame [indiscernible] floor is U.S.

On behalf of the group of statutory auditors, Ernst & Young and KPMG, I'm pleased to report our engagement and the reports we issued for fiscal 2025. We have issued several reports and in keeping with the practice of this meeting, I propose not to read them in full but to provide you with a summary.

Our report on the consolidated financial statements and our report on the annual financial statements have been made available to you as part of the shareholders' meeting and appear on Pages 245 to 248 and 267 to 270 of the universal registration document, respectively. Our work aims to provide reasonable assurance that the financial statements are free of material of the statements, comply with the applicable accounting standards and that give a true and fair view of the consolidated financial statements of the assets and liabilities of the group's company's operations for the year [indiscernible] ended.

We carried out our work in accordance with the professional standards applicable in France. At the end of our engagement, we presented our conclusions to the finance department the Audit Committee and the Board of Directors of your company.

In summary, we issued an unqualified opinion on Sodexo's annual and consolidated financial statements for fiscal 2025. Our reports on the annual and consolidated financial statements highlight the key audit matters. For the consolidated financial statements, the key audit matters are measurement of the recoverable amount of goodwill and tax risks. For the annual financial statements, the key audit matter is the valuation of equity investments.

Our reports on the financial statements include for each of these key audit matters, a description of the risks identified and the response we provided. Our reports on the financial statements also include the description of certain risks and the responses that we provided. Our reports on the financial statements also included the conclusions of certain verifications provided by law -- required by law, which we performed on information contained in the management report, notably in its section on corporate governance. We have summarized the nature and scope of these specific verifications in the table currently displayed on screen.

In summary, we have no particular comments to make following these specific verifications. I now propose that we move on to our special report on related parties agreements, which appears on Page 271 of the universal registration document. No new agreement has been submitted for approval by this shareholders' meeting. report refers to the management support and services agreement between your company and Bellon SA, which was already approved by the shareholders' meeting in previous years. The amount recorded as an expense for fiscal 2025 amounts to EUR 4.6 million, excluding taxes.

Finally, as part of the extraordinary portion of the shareholders' meeting, we have issued four special reports concerning resolutions that may have an impact on your company's share capital.

Our conclusions are as follows: on the 15th resolution, we have no comments to make on the methods used to determine the issue price of the equity securities to be issued as provided in the Board of Directors' report. As the final conditions under which the issuance would be carried out have not yet been determined. We do not express an opinion on them.

On the 17th resolution, we have no matters to report as to the information provided in the Board of Directors' report relating to the proposed free allocation of shares.

On the 18th resolution, we have no comments to make on the methods used to determine the issue price of the equity securities to be issued as provided in the Board of Directors report as the final conditions under which issuance would be carried out have not yet been determined. We do not express an opinion on them and consequently on the proposed cancellation of preferential subscription rights.

On the 19th resolution, we have no matters to report as to terms and conditions of the proposed reduction in capital.

Ladies and gentlemen, I'm going to present a summary of our assurance report on sustainability information, which appears on pages 172 to 175 of the universal registration document. The objective our engagement was to express a limited assurance opinion on three distinct areas as required by the provisions of the French Commercial Code in the guidelines of a high audit authority.

The first area concerns the compliance of the process implemented by the success of Sodexo Group to determine the information to be published including the obligation to consult the Social and Economic Committee. The aspects that received particular attention from us relate to stakeholder identification of impacts, risks and opportunities as well as the assessment of impact materiality and financial materiality. The second area addresses compliance with the ASRS standards and the French commercial code for sustainability information presented in the group's management report.

In this context, the -- the aspects that received particular retention related to information published under climate change ESRSE1 standard and under social standards and workforce information under ESRSE1 standard without calling our conclusion into question. And in the context of the first year of application of the CSRD, we draw your attention to the basis of preparation of the sustainability statement which specifies in particular, quantitative information or presented or presented in a partial scope or subject to estimates and extra operations.

Finally, the third and last area of our engagement concerns compliance with the publication requirements on taxonomy as provided for in Article 8 of the EU regulation 2020/832 -- 852.

In summary, and based on the procedures and verifications we performed, we did not identify any material errors emissions or inconsistencies in of these three areas of our engagement. Ladies and gentlemen, the shareholders, I'd like to thank you for your attention. And I'll now hand the floor back to the Chairwoman.

Thank you to both of you for your presentation. Dear shareholders, before we move on to the Q&A session. I suggest that Florence Negrel should present the resolutions that will be submitting to you for the poll.

Florence Negrel will now present the resolutions.

Ladies and gentlemen, there are 20 resolutions submitted to the vote today. 15 is ordinary resolutions and 25 is extraordinary resolutions. Through the first 2 resolutions, there's ordinary resolutions, we propose that you approve Sodexo's [ statutween ] consolidated financial statements for fiscal 2025. showing, respectively, a net profit of EUR 777 million and a consolidated net profit attributable to the group of EUR 695 million.

Under the third resolution as an ordinary resolution, we propose that you approve the allocation of earnings and set the dividend at EUR 2.70 per share for fiscal 2025. This dividend will be paid on December 23, 2025. In accordance with the bylaws, a 10% increase on the ordinary dividend will be granted for shares registered in nominative form for at least 4 years as of the payment date.

On to resolutions 4 to 7 as ordinary resolutions, we proposed the appointment of three new directors for a term of 3 years. That is Bellon SA represented by Patrice de Talhouët, [ Genevieve Bish ], Francois [indiscernible], as well as the renewal of Luc Messier directorship also for 3 years.

Under the eighth and resolutions as ordinary resolutions, we propose that you approve the compensation components paid or awarded to the Chairwoman and CEO for Fiscal and approve the information relating to the compensation of corporate officers as provided for in article L22-10-9 of the French Commercial Code. These components were presented by Cécile Tandeau de Marsac, Chairwoman of the Compensation Committee and are included in the 2025 universal registration document. Under Resolutions 10 to 13 as ordinary resolutions, we propose that you approve for fiscal 2026. The compensation policy for directors, the compensation policy for the Chairwoman and CEO for the period from September the 2025 to November 9, 2025, inclusive for the Chairwoman of the Board as from November 2025 and for the Chief Executive Officer as from November 10, 2025. These components were presented by Cécile Tandeau de Marsac, Chairwoman of the Compensation Committee and are included in the 2025 universal registration document.

On to the 14th resolution as an ordinary resolution, we ask you to renew the authorization granted to the Board to allow the company to trade in its own shares. Outside the period of a public offer, and under the 15th and 16th resolution as extraordinary resolutions, we ask you to renew the authorization granted to the Board to allow the company to carry out capital increases with retention of shareholders' preferential subscription rights to set the overall ceiling for such capital increases and to carry out capital increases through the capitalization of premiums, reserves, earnings or other amounts eligible for capitalization.

Under the 17th and 18th resolution as extraordinary resolutions, we ask you to renew the authorization granted to the Board to allow the company to grant free shares of existing stock and/or issue shares to employees and/or corporate officers of the group and to carry out capital increases reserved for employees who are members of company savings plans.

Under the 19th resolution, as an extraordinary resolution, we ask you to renew the authorization granted to the Board to allow the company to reduce its share capital by canceling treasury shares.

Finally, under the 20th resolution as an ordinary resolution, we invite you to approve the powers necessary to carry out the legal formalities.

Ladies and gentlemen, I would like to remind you that you have the option to receive your notice and vote electronically via the vote access platform. We encourage shareholders who have not yet done so to contact their financial institution to subscribe to this service, which will allow them to exercise their rights more easily and quickly. Thank you.

Thank you very much, Florence. I suggest that at this point, we open the Q&A session. Before taking questions from the room, I'd like to inform you that the company has not received any written questions from any shareholder. So

ladies and gentlemen, there were host and hostesses at your disposal in the room. So please identify yourself if you have a question, and you'll be handed a microphone so you can speak into it to ask your question. Number four over there, please?

On two topics. The first will have to do with the location in North America of Sodexo. The second point about the 60th anniversary in 2026 of the creation of Sodexo. The U.S. was the #1 market in Sodexo because they represent 47% of our activity.

But since a few years, they become our weak point. In the last few months, significant contracts were lost in American universities due to the [indiscernible] the growth in hospitals, is not as good as we had expected. Outside to the American giant Europe and particularly France, look are somewhat dwarfed. France only represents 12% of consolidated sales.

Have you never thought? This is my question about having a more balanced geographical approach to raise -- raises foot off the gas in the U.S. and to reinforce our presence in Europe and in France. After all, Sodexo was not born in Connecticut. It was born in Marseille in France, I would like to bring up the second topic.

The 60th birthday or anniversary of the foundation of Sodexo. It was on the ninth of March, 1966 that Pierre Bellon created Sodexo was to become the worldwide giant in collective osteration. And this is my suggestion. Why not organize an assembly of all the shareholders at the San [indiscernible], why not with a stance in animations and to present the recipe recipes and meetings with corporate staff and to around the whole, a wonderful banquet and the cocktail by [ lent ].

And lastly, at the end of this party, everybody could say like your father would, Madam -- Chairman. I had a great time. Thank you.

Thank you for your question. Thank you very much for your question. I'll let Thierry answer the first question, and I'll answer the second one.

Thank you so much for your question. About the strategic choice of deployment of our activities in development throughout the world. Sodexo, our intention was to be present in all markets where our services, whether it be in restoration or wherever there is a need. And where we have an ability to grow and to develop.

Sodexo is a leader -- an undisputed leader in France that you spoke about. But it's also a huge leader in the United States. There are two big markets. And we have the ability to orient our growth to these two markets, in particular. The American market is the biggest world market these days, and we're one of the leaders. We are very strong in the United States, and there's no reason to be afraid of continuing our development in the U.S. as to the French market, it's obviously an essential and fundamental and historical market for us in which we are having good growth and more potential for development is still there and that we will continue to invest in.

I'll just add to what Thierry said that well, we're #1 in France. We're not #1 in the U.S., but we're not in France, we want to stay in that leading position. Some of our competitors are investing in France, too. And we want our main leaders in France. We've got to also continue investing here. Now regarding the 60th anniversary of Sodexo, well, thank you for your suggestion. Well, if we want to invite all the shareholders, it would be very pleasant, but the thing is we've got lots of shareholders to our friend, but we've managed shareholders from outside of France, too, would be kind of complicated to bring everybody together in one place.

And on geographical location, while we'll be celebrating the event, of course, we will be celebrating it locally as well in the different countries where we have a footprint and the [ Notre ] cuisine, well, you'll be able to appreciate some of it after the meeting outside here in the lobby, and we'll be keeping you posted about the celebration events that will be organized for the 60th -- organizing for the 60th anniversary.

There's a question over there towards my left, number one, I think.

Association for the heritage of individuals. I have an observation in five short questions.

First of all, congratulations of having made it possible for students who are present here today in the [indiscernible] University participate in the general assembly and to understand that humans are at the heart of companies. They've been doing this for several years.

It's not the first time they've been coming for several years at this point. Maybe not the same students, but, students have been coming for the last number of years. We do encourage students to come and understand the governance of companies.

Leasing numbers of companies are asking their staff to be physically present in the office and the impact of that trend. What effect does that have on your business? Second question. I congratulate for the separation of functions. It's a sign of good governance. The extension of responsibilities of Thierry Delaporte, the new Chief Executive Officer in the U.S. seems to be a good initiative since he knows the practices and culture of management in the U.S. Why do you keep the same President a strategic counselor because the performance wasn't apparently satisfactory? Could you give us some feedback on the application that was started in the U.S. in 2024?

Fourth question, the European Commission approved our acquisition of control the Mediterránea Group from Catarina in Spain. Do you continue -- do you intend to continue to invest in this country to reach a critical size. And lastly, apparently, you have many contracts with oil companies such as Shell or gas company [ Santos ] in Australia. Are there any specific things at Sodexo that would make it possible for you to have a plus in these sectors?

I'm not certain I fully understood your second and third questions. On the presidency are the chairmanship of the Strategy Committee was in the U.S.? Was that your -- question number two.

Well, the current President in the U.S. and the company seems to be stepping down from his post but staying on as an adviser. So maybe, Thierry can answer that question. Given the unsatisfactory results you achieved, why is he staying on is my question?

I'll take the first two questions. The first was concerning the need or not first half, what we thought was due to the fact that employees work from home or for the offers. I think that was the question. I think it's Sodexo for some years now, there have been changes in the way of working.

And our employees are quite attached to a certain form of a hybrid solution, which enables them to work one or two days a week from home. But that means the rest of the time they work in the office. We are particularly attached to the fact that they do come indeed regularly to the office. We believe we're a company of people, a human company. It's very difficult to develop a collective culture and the collective feeling if we don't know each other. And if there's no better way to know somebody than to work together to meet and to be in the same place.

So the physical presence in the office is very important for the development corporate culture, but also so that this talent can grow and develop their own careers, we believe that's important for that they be regularly present in our walls.

As to the second question, having to do we're the former Chair of Sodexo in North America. We made the decision. So just several days ago to change our governance structure, and I took the decision to hire directly the management of the region, which makes it possible to be much closer to the field and to better understand the reality. It's also for me a wonderful way to base in the culture and the reality of the field of the contextual company there.

And in this framework, we set up a transition period, which is over time, and what you are referring to is simply part of the transition. We should not envisage that this is a permanent role is slated to your last.

I'll let Sebastien answer it.

Thank you for your question. Now about acquisitions and Mediterranean in Spain, Acquisitions are part and parcel of our strategy for -- mergers and acquisitions in the existing market. So Mediterránea will help us double our size. EUR 300 million in revenue. So we double the size in the market in Spain in this way, which will enable us to be co-leaders in the market, and we will be able to generate a pretty different -- a pretty significant effect of scale.

For your fifth question on the oil company contracts, you mentioned mining contracts too. Indeed, we do have teams that are specialized in that kind of contract. We're very active on those contracts in the U.S., in Canada, in Latin America, in Brazil and also in Australia. Santos is a contract, which is -- in the mining sector, we renewed Rio Tinto, which is our largest contract at the end of the calendar year of 2024.

And yes, all of these geographies apart from the U.S. and Canada are indeed under the responsibility of John Paldimik, who is in charge of ATMEA, but also Latin America and Brazil. So clearly, there are synergies and a lot of exchanges that go on between them and our teams because they are specialized in these areas. For those contracts, we operate for mining contracts, for example, we're in the middle of a desert in the north of Australia.

For Rio Tinto, you're isolated from the rest of the country and customer proximity is really important then. And just to crystallize that concerning the uniforms, you haven't got the Sodexo people and the Rio Tinto people, we have uniform with Sodexo Rio Tinto together on the uniform. So we work in close conjunction with the Rio Tinto people. So there are specialists here working on those contracts. And when we signed Rio Tinto, that contract, we utilized know-how we gleaned in Chile with central cooking facilities called Colinas and the Rio Tinto client went to see in Chile, what we were doing down there to understand the know-how we had, they were -- they found their attractive, they're convinced buy it, and that's what we set up for them in the new contract we have with them now. that will be starting shortly.

And regarding our oil company clients, we have a very large client in the United States, Chevron. We've grown the business with them. And in the last year. We're big with Shell to we're present with Total in France, but Thierry thinks we should continue developing our business with Total in the rest of the world, too, a French company.

And in the world of our people, it would be great if we could be supportive of each other. That would be one of the objectives going forward for 2026. So thanks for your question on that. Also, did I forget a question, question number three. I didn't hear properly perhaps -- I'm not sure if I answered it or not. Could you repeat it? Would you mind? I had lots of questions. I let you ask five, but I'm sorry, I forgot one of them, but maybe you could repeat it. Well, they were short, but they needed appropriate answers to. We're learning.

The third one was, could you give us feedback about the application that was rolled out in the U.S. in 2024?

You rolled out an application -- additional application, you mean? Okay, yes. Well, it's working very well. we rolled out in the enterprise segment, the business segment where our teams are pushing forward the use of that application and also on the University segment where students are really -- they really go for that kind of mode of consumption.

Everything that's digital can facilitate consumer lives these days, and it increases the average spend. And there's are manager over their as, [ Alice ], you can talk to the cocktail reception afterwards, if you like the figure actually is not just the U.S. but it's driven by the U.S. In 2022, we had 1.2 million consumers directly interacting with our digital ecosystem. Now there are 6 million. Now on the -- out of the 80 million consumers, it's not it's not a big enough proportion, but we're continuing to go forward on this and speeding it up fast tracking it, investing more and more, and especially in the U.S., where our consumers really love those applications. So thank you for that question.

There's number two over there on the left, I think.

Charles [indiscernible] questions. First about Lenôtre, the icon of the brand of French gastronomy. What I read recently that it was too expensive, not as good. we're closing 3 out of the 11 sites. What's going on? That's my question. What's your communication policy about this superb brand and how can you fix it?

The second question has to do with the Sodexo policy with respect to additives and colorants of which we talk about so often. What's your position on food eyes, do you avoid using them? Are you the friend of [ UCA ]

Third point, having to do with the stock market values, there's a contrast between this beautiful company and the change over 1 year or over 10 years. we got minus 31% over 10 years, minus 43% since 2025, but there are results. How can you explain that? I'd like to ask you if there's -- why are you not trying to develop the shareholder ship on the part of staff. There's only 1.5% of our shareholders and the company very often in [ Bouygues ] associate. This is a very large portion of their shareholders are working there, and they're doing well in the stock market.

I'll let Sebastien answer your last question.

I'll start by the stock market values. I understand your frustration. The decrease in the listings occurred subsequent to the revival of our guidance for 2025. We reviewed our guidelines downwards in March and reduced our growth but it's between 3% and 4% with a margin between 10% and 20%, which we confirmed at the end of 2025, this revision of the guidance.

But nonetheless, this is -- it was a disappointment, it perceives as just either in a waiting position. We have expressed our guidance for 26 million transition year in organic change between -- and the pressure on margin. These have to invest. So the situation is that of expectation is a waiting period the cost has to reflect the feeling of the market at a given point in time. And it's up to us to rebuild that trust with the new [ shopper ] that's opening, so as to be able to give a positive inflection to the stock market prices. Thank you.

Concerning the neutral answer, if you don't mind. So regarding lent, we keep on reviewing the business network. We try to meet customers' expectations. The stores that were closed down weren't servicing their customers, as well anymore, but we opened in Galeries Lafayette, a corner, a [indiscernible] corner in Galeries Lafayette gourmet [indiscernible], that is the idea is to focus on locations that are most relevant and to have better conditions to continue developing Lenôtre in the future, and we do remain very committed to the Lenôtre company.

They really provide exceptional quality products in their stores. And we want to be in line with the standard of excellence that's always led to the fantastic reputation of Lenôtre and we're working on improving that experience year in year out. Regarding your question concerning transparency on the ingredients and our know-how on that. What we have know-how that respects nutritional standards. And I'd like to recall that we're cooks and chefs we try and work as much as possible using raw materials that have not been processed, additives and color and that you're talking about coloring agents, that's where products produced industrially by the food industry, usually, that's much less our case.

So we respect nutritional standards and health and safety when it comes to food products, we work mainly with fresh produce, not processed products. So obviously, in selecting our food stuffs, our procurement people are very attentive to all of these matters.

And as we explained, as has been shown through the videos through [indiscernible] was said, and as you know yourselves, were leaders on sustainable food services these days. We've given the strongest commitments. If you look at our French and non-French peers, we are the ones who want the furthest in all of our countries and with the commitments we've given for 2030, 2035 and 2040 as well to be borne in mind. We've gone further than our peers and our competitors, we're really attentive to this, and we want to be a step ahead of others, and we are a step ahead of others right now with "Better Tomorrow 2025" and the new commitment we're making with "Better Tomorrow 2028", our new plan, we want to continue maintaining our lead and manage all of the dimensions, you mentioned the additives and such like. So thank you for those questions.

There's a question over there -- there are lots of questions. I see a lot of hands going up towards the back of the room, microphone number six perhaps.

Hello, Mr. [ Jean Bars ], my name. I have a question. Well, firstly, well done on separating dissociating the post of Chairperson and CEO. You still have a contract between Bellon SA and Sodexo to provide services. I think last year was EUR 5.1 million. Now it's EUR 4.6 million. Why has that contract gone down? And could do the members of the Board look at that?

Does this service contract need to exist because the company Bellon SA, I think, received dividends, EUR 167 million in the previous fiscal year, I think. So whilst the advantage of having that agreement with our company? Secondly, on long-term incentives and long-term remuneration. The only place I see variable compensation index to potential development of the stock price is -- there's just one 1 place. So it should be more, I think, because for us as shareholders, it's a really important criteria. And what I see in the TSR is that you have a panel and you give a list of the companies and the panel. Well done on that Sophie.

Well, answer on this service agreement with our [indiscernible] Bellon SA are shoulder to the tune of 43.8% of Sodexo. So they have 58.8% of voting rights.

And this agreement bolsters the structure and the leadership role of Belllon SA. This leadership will consist of defining jointly the long-term strategic guidelines for Sodexo. And the variation in the amount, as you mentioned, I won't go into the mathematical details, but there or people who work for Bellon SA that are cross-charged built to Sodexo. And it depends on the salary of those persons. So it's normal for to vary from 1 year to the next.

Then the second question was both the LTI, yes. And the TSR portion and the importance of the stock price. Yes, the indexing is using a TSO with the benchmark of peers. In our industry or similar industries. And I think the percentage is already 30% if I'm not mistaken. So it's already quite a large percentage. And we chose that relative with because we did benchmarking with what's done in other companies. And it's a fairly conventional way of doing things actually. So thank you for those questions.

There is another question. I think it's microphone number one down there. We'll just take -- we'll do two more questions if you don't mind, because we're going to have to move on. And well, maybe number four over there. The gentleman towards the middle microphone number four, I think? It was one and four, I think. This gentleman is right in the middle of microphone number four first.

In the food -- any risk is big, whether it be bacteria or salmonella or [ steri ] or whatever or some kind of the new virus. And the portage is a matter of health.

On the other hand, you have -- the rupture of the cold chain. What are the processes that you use to make sure that you won't have a gastroenteritis vehicle and a lot of industrials have had problems with contamination. You also work in hospitals or schools. There could be a significant risk, and it could be really too bad for the group. That's an issue.

You're quite right. This is something we're quite aware of. It's something we've been working on since the very start of the group since the inception of the group. It's part of our job really, it's the prime risk you've got to try and fight against in this business line. So what do we do? We train our people first start. We train them, retrain them, reskill them and refresh skill them and so on.

And that's really in the center stage of our priorities. We've got protocols for what we produce because it might be a cold chain. It might be a site in a hospital, it might be in the company is not quite the same mode of production. So we've got protocols each time a very strict ones that must be adhered to depending on the sector, depending on the activities we have in each site, the type of site didn't -- I mean there's a whole set of protocols as a function of the typology of the site.

So as to make sure that we abide by all those protocols, we do regular audits in our restaurants, but also on the side of our suppliers because we've got quite a lot of purchasing power, and we work closely with our suppliers, and we try and work hand-in-hand with them and keep them over time. We're long-term partners for our suppliers, and we try to, therefore, make sure they make the commitments we want them to make. And that we make ourselves so that we can trust their protocols.

So that's really in the forefront of what we do. It requires training. It requires management overseeing their teams that their direct reports are doing the right thing, and we do conduct these orders as well. And the whole town, we keep on challenging ourselves. And if there is a problem, we immediately escalated to group level and I can tell you that the slightest problem is escalated in the space of the day on the same day.

And we have a whole protocol set up to understand what's happened and to use this as a learning experience, maybe just a small problem, but we still have to learn from it and make sure it doesn't happen again. The percentages, oh it's tiny. Gastroenteritis, that's -- it's a virus. And it's very difficult. I mean, we start identifying there's a problem if in the side, there are several cases are a very serious case, but gastroenteritis can come -- doesn't come from what we produce.

It can be in the year around us -- kind of just maybe at the cock [indiscernible] all over the price these days. So we can measure like that. We've got to measure the number of cases reported on the site. And then sometimes there may be cases but it may not be due to our activities at all. So then we do an investigation, but we doesn't happen every day. The EUR 18 million of meals served per day. It's pre-reassuring. We don't have this problem often. Is there a last question? Have we exhausted your questions.

There's a question over there. At microphone number one, perhaps no? Is that all then? No more questions? There is a gentleman there who wants to ask a question, I think, towards the middle, if he could be given the microphone, microphone number 5.

One last question then. And we've got to vote on the resolutions and then go to the cocktail in that order. Otherwise, it won't be on the cocktail, if we don't vote on the resolutions.

I have a question, Sodexo's a proximity or a local group. Providing local restoration. You spoke about an application deployed essentially in the U.S. apparently. I would like to know a bit more about your ambitions in digitalization or digital services. Why combined humans with a digital approach, which you haven't lots of movies. But I mean, why do you in your business that you have digital ambitions in new technologies?

Thank you. With that question kind of projecting us into the future. Firstly, smile will never replace a real smile. That is a conviction I have myself that I think is defended by many people by all of our employees anyway. And yes, of course, we have an application, but -- we also have people in a restaurant in the company, in a hospital doing the job. And if we use connected tools is to bolster the links we have between the consumers and our teams.

So it's an augmented experience for the consumer. But if you want to use the tool you can use if you don't want to use it, you don't have to use it in other words. You can continue interacting directly with our staff members. And a few weeks ago, there was a major form, adapt AI at the Grand Palais and people tended to say, look, AI is going to be used, how many people are going to make redundant.

No, that's not the issue. We've got 426,000 people right now. We're not going to make any but redundant. We are going to utilize AI to make sure that our teams we'll have fewer repetitive tasks to do. I mean I'll give you an example. The menus and AI, if you have to change your menu because you have a change in product or product cost, very expensive. You've got to change the menu got to put the new product down to the menu instead got to adapt things because sometimes clients don't want exactly this new product.

But this tool enables us to do what you say. In the past, it could take days and days to make the change, and it will take just a couple of hours, thanks to AI. So that's the kind of tool that will be useful for us.

And -- we have our foresight to, let's we call it. So we can identify with our clients the population that will come to dine at a certain point in time. And the people on the site using the tool. Instead of spending hours and trying to anticipate it's a Friday. So how many people will come and dine in Monday or Wednesday, how many will we plan for?

We use all the data that have been entered into the tool, and they will realize upfront how many people they should be prepared for. And they use this tool, they realize is very reliable and the time that they will save, they don't have to do forecasting much, they will spend that time then with their teams talking to the clients when the meals are being served to see if the consumers are satisfied and so on.

So to free up time for them to do more higher-value activities. So we want to enhance the customer experience also improve the interactions we have with clients, with diners as well so as to therefore as I say, make for a better experience, and we'll also be able to measure our carbon emissions better.

So with this tool, we can provide all this information to our clients and help them in their own transition to reduce their carbon emissions and improve the experience for our team members who will spend less time on repetitive tasks that prevent them from focusing on the consumer experience. I hope that's an answer to your question. It was a very good question, though. It's indeed a very exciting topic for the future.

You can go and talk to Alice. Lots of people who want to see here during the [indiscernible] she's the lady expert on this subject, Alice.

So I think that runs off our Q&A session. Thank you. for all of your questions. I suggest we should close this Q&A session at this point. And the team in charge of Shareholder Relations is available as they are throughout the year, of course, to answer your questions. And we've got many of our senior managers with us, lots of the French teams, the procurement manager, HR manager, communication manager, the demand for France. So we've got many of our senior managers here with you that you can chat to as well.

And I'll give the floor now to Florence Negrel to vote upon the resolutions.

We're at the final quorum. We'll be taking into account the number of shares currently in a number of shareholders present represented or having voted by correspondence [ 126,759,02,206 ], 87% of shares entitled to vote. In the legal quorum or the ordinary reading and the extraordinary meeting has been reached. And the voting of the resolutions can therefore be validly carried out. We will now proceed to the vote on the resolutions. As you look at a short video explaining how to use the tablets that were handed to you when signing the attendance sheet.

[Presentation]

The first resolution adoption of individual company financial statements for fiscal '25. I open the vote. Those has been adopted by 199.98% second resolution. Adoption of the consolidated financial statements for fiscal 2025. The vote is -- and I open the vote.

[Voting]

The vote is closed. The vote is adopted by 99.98% of votes. Third resolution, appropriation of net income for fiscal 2025, determination of the dividend amount and payment dates. I open the vote.

[Voting]

The vote is closed. This resolution has been adopted by 99.99% of the votes. Fourth resolution, appointment of Bellon SA as a Director for a 3-year term. I open the vote.

[Voting]

The vote is closed. This is adopted by 82.54% of fifth resolution, appointment of Genevieve Bish as Director for a 3-year term. The vote is open.

[Voting]

The vote is closed. The resolution has been adopted by 99.97% of the votes. Sixth resolution, appointment of [ Francois Copa ] as Director for a 3-year term. I open the vote.

[Voting]

The vote is closed. This resolution has been adopted by 99.99% of the votes. Seventh resolution, reappointment of Luc Messier as a Director for a 3-year term. The vote is open.

[Voting]

The vote is closed. This was a 98.22% of the votes. Eighth resolution, approval of the components of compensation paid during or awarded for fiscal 2025 to Sophie Bellon, Chairwoman and CEO. I open the vote.

[Voting]

The vote is closed. This vote has been adopted by 76.73% of the votes. Ninth resolution, approval of the information related to the compensation of corporate officers and directors paid during or awarded for fiscal 2025 as referred to an article L22-10-9 of the French Commercial Code. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted at 99 of the votes. Tenth resolution, approval of the compensation policy applicable to the directors. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 99.71% of the votes. 11th resolution, approval of the compensation policy applicable to the Chairwoman and CEO for the period from December 1, 2025 to November 9, 2025. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 91.22% of the votes. 12th resolution, approval of the compensation policy applicable to the Chairwoman of the Board of Directors as from November 1, 2025. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 88.65% of the votes. 13th resolution, approval of the compensation policy applicable to the Chief Executive Officer from 10 November 2025. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 97.72% of the votes. 14th resolution, authorization for the Board of Directors to purchase shares of the company. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 99.74% of the votes. 15th delegation of powers to the Board of Directors to increase the company's share capital with preferential subscription rights for existing shareholders, by issuing ordinary shares and/or other securities carrying immediate or deferred rights to the company's capital. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 99.23% of votes. 16th resolution, delegation of powers to the Board of Directors to increase the company's share capital by capitalizing premiums, reserves, profits or other sums eligible for capitalization. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 99.74% of the votes. 17th resolution, authorization for the Board of Directors to grant existing and/or newly issued to restricted shares to all or certain employees and/or corporate officers in the group with automatic waiver by shareholders of their preferential subscription rights. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 98.46% of the votes. 18th resolution, dedication of powers to the Board of Directors to increase the company's share capital without preferential rights for existing shareholders, by issuing ordinary shares and/or other securities carrying immediate or deferred rights to the company's capital reserved for members of employee share purchase plans. The vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 99.60% of votes. 19th resolution, authorization for the Board of Directors to reduce the company's share capital by canceling treasury shares. Vote is open.

[Voting]

The vote is closed. This resolution has been adopted by 98.79% of the votes. And the last resolution, powers to carry out formalities. The vote is open.

[Voting]

This resolution has been adopted by 98.99% of the votes. Thank you for your attention. I will now hand over the floor to Sophie Bellon.

Thank you. Thank you, Florence. Ladies and gentlemen, thank you for placing your trust in your Board of Directors through these resolutions. We shall now adjourn this session. And thank you for attending, and I would invite the shareholders with us here in the room in Paris to move towards the cocktail prepared by Lenôtre. So we'll meet at the cocktail reception in a very short while. Thank you.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Good morning. Thank you for standing by, and welcome to the Sodexo Fiscal Year 2025 Results Call. If you -- I advise you that this conference is being recorded today, Thursday, October 23, 2025.

I would like to hand the conference over to the Sodexo team. Please go ahead.

Good morning, everyone. Welcome to our fiscal 2025 results call. I'm here with Sophie Bellon and Sebastien De Tramasure. They'll go through the presentation and then take your questions. [Operator Instructions] The slides and the press release are available on sodexo.com, and you'll be able to access this webcast on our website for the next 12 months. Please get back to the IR team if you have any further questions after the call. I remind you that our Q1 fiscal 2026 revenues announcement will be on Thursday, January 8.

With that, I now hand over to Sophie.

Good morning, everyone, and thank you for joining us today. We spoke to you a couple of weeks ago regarding our governance changes. And today, we are going to cover our fiscal year '25 results and our priorities and outlook for 2026. Just on the slide here, a brief summary of what we're going to cover today.

When I became CEO in 2022, our priorities were clear: reposition Sodexo as a pure-play food and services company and simplify the organization. Over the past 3 years, we've made solid progress, streamlining the portfolio, refocusing on food, accelerating key investments and strengthening client relationships. These were essential steps to build a strong foundation for sustainable growth.

In financial year '25, results came in line with revised guidance, reflecting both operational and commercial challenges. We are actively addressing these with targeted action plan in commercial and in U.S. universities. We're also continuing to strengthen our foundation. With this in mind, fiscal year '26 will be a year of transition and the start of a new phase for the group. Thierry Delaporte will soon take over as CEO, bringing the right experience and profile to drive operational execution, accelerate commercial momentum and lead the group forward.

But let's now first take a backward perspective on our key achievements from the last 3 years and 2026 priorities before Sebastien walk you through the fiscal year '25 results and the resulting fiscal year '26 guidance.

Turning to the next slide. While I won't go into every detail here, this timeline of recent years shows the major steps of our shift to a pure-play food and services company. We have simplified our structure through geography reorganization and the sale of Sofinsod. We have actively managed the portfolio by spinning off Pluxee and making other non-core disposals, while pursuing targeted acquisitions to accelerate in food.

So if we look now at the impact of this refocus on core activities, you can see that there has been real progress in the numbers. Let me pick out some highlights. Food now covers more than 2/3 of our portfolio, up from 62% in fiscal year '22. We have modernized the offer based on data-driven insights across culinary, digital and sustainability. Digital engagement has surged almost 6 million active consumers, up from just over 1 million, showing how we're expanding our reach and creating new growth avenues.

Our branded food offer now represents over 50% of revenues versus less than 20% 3 years ago, improving client experience, standardization and operational efficiency. Entegra has more than doubled in size, boosting procurement benefits, and we have also advanced catalog compliance, both strengthening our competitive edge.

On sustainability, we are hitting the targets we set on workplace safety, carbon and food waste, thanks to close collaboration with our clients and partners, and we are leading by far the industry on those aspects. And all of this is creating tangible value. Our underlying earnings per share has grown at 14% compound annual growth rate, and we have seen a marked improvement in our return on capital employed.

Moving on to commercial performance. We have made a solid improvement in retention and development compared to the pre-COVID period. Over the last 3 years, our average retention is 94.5% versus 93.5% between 2017 and 2019. Likewise, on development, we signed around EUR 1.7 billion of new contracts per year, including cross-selling compared with EUR 1.4 billion before the pandemic. This is a result of our ongoing focus on processes, team culture and competence, but also client relationship. However, this does not reflect our full potential with fiscal year '25 presenting some commercial challenges.

In fiscal year '25, retention came in at 94% due to the negative impact from the loss of a global account and softer performance in North America, in particular, in Education. Performance is uneven across the business. For example, U.S. Healthcare. In U.S. Healthcare, we delivered retention above 97%. And in France and Australia, we were above 96%.

On development, H1 was strong, especially in Europe and Rest of the World, but H2 softened and total new business landed at EUR 1.7 billion. North America, which remains our largest market, is where we need to improve. We have clear actions underway. We are addressing near-term priorities in U.S. Higher Education, and we are strengthening our U.S. sales team through expansion and training. We are also investing and reorganizing to make sure we capture the market's potential.

I will now walk you through in more detail how we are addressing the challenges in U.S. Higher Education. We clearly had some performance gap over the past couple of years in this segment, and it's translated into market share losses. Since February, together with Michael Svagdis and his team, we have carried out a comprehensive diagnostic process to fully understand the root causes behind this lack. A few key issues stood out. First, our footprint is still too concentrated in small and midsized institutions. Second, we have not focused enough on mid-plan renegotiation. And third, we've had some resource misalignment.

The remedial action plan is already well underway. Michael has put in place a new organization with culinary and digital now reporting directly to him, and he has reenergized the team to drive best practice and greater standardization. Our sales function was clearly subscale, so we have expanded the team by 50% with the newly hired sales executives already in place and operational. We are also targeting more large universities and athletics, working more closely with Sodexo Live!. To strengthen existing relationship, we are growing our account management team and refreshing our broader teams, bringing in new talent where needed to ensure the right capabilities are in place.

Execution is a big focus. We are currently renegotiating 75 meal plans for implementation in fall 2026, and we have rebuilt the meal plan team, which had been disbanded during the COVID period. Now we are harnessing data and tech to methodically track what's selling, where and to whom. We are deploying digital platforms like Everyday and Grubhub, and strengthening our own retail brands to streamline the offer.

This plan is clear, but it won't be executed overnight. Some levers will take time. And given the timing of the selling season, fiscal year '26 is largely set already. The goal is, therefore, to restore growth momentum and capture new market opportunities progressively from fiscal year '27 onward.

Michael and his teams are laser-focused. Michael has visited more than 20 campuses in the last 3 weeks. The feedback is very consistent. Universities are under financial pressure. They are becoming more business-driven, and they are open to change. That creates challenges, but also a lot of opportunities, and we are now in a much better position to seize it.

So as you can see, we have set focused priorities in the U.S. for this year, short term very execution-driven, to put us back on a stronger trajectory. With that in mind, fiscal year will very much mark itself as a year of transition. It will still reflect some of the commercial challenges we have just discussed, but also the investments we are making to strengthen our foundation to drive efficiency, accelerate digital and prepare for long-term growth. Sebastien will get back to that.

We have a strong foundation to build on, with a solid balance sheet and the flexibility to invest where it matters most. We are the #2 player globally with a balanced portfolio across regions and segments. We have the scale to leverage procurement, technology and operational excellence across the group. Our culture remains a key driver of sustainable performance, purpose-driven, people-focused and deeply engaged with our clients.

Retention in our industry drive resilience, and our teams are proud to deliver on our mission every day. And of course, we operate in a large and attractive market, still 50% in-sourced with significant outsourcing opportunities ahead of us.

Looking ahead, I'm also very confident in the next phase for Sodexo. On November 10, Thierry Delaporte will join us as Group CEO. He brings over a decade of leadership experience in the U.S., strong digital and AI expertise and proven track record in leading large people-intensive organization. He's operational and execution focused and deeply aligned with our values. He is the right fit to take Sodexo into its next stage of development.

And with that, I'll now hand over to Sebastien to take you through the fiscal year '25 financial and fiscal year '26 guidance in more detail.

Thank you, Sophie. Turning now to our fiscal '25 performance. Overall, our performance was in line with our revised guidance. Organic growth came in at 3.3%, slightly higher at 3.7%, excluding the base effect from the major sports events and the leap year in fiscal 2024.

Underlying operating margin was 4.7%, up 10 basis points at constant currencies, while on a reported basis, it was broadly flat due to the FX headwinds. Free cash flow was EUR 459 million, including the exceptional cash out of circa EUR 160 million related to the finalization of the tax reassessment in France. And excluding that, our cash generation remained robust with an underlying cash conversion of 91%. Underlying EPS reached EUR 5.37, representing a rise of plus 3.7% at constant currencies. And the Board will propose a dividend of EUR 2.7 per share, up 1.9% versus last year and in line with our 50% payout policy.

So now let's have a look at our performance by geography. Breaking down our results further, all regions contributed positively to our performance. Our largest region, North America, delivered 2.8% organic growth, reflecting strong results in Sodexo Live! and Business & Administrations, along with solid underlying momentum in Healthcare despite timing impact and partly offset by contract losses in Education.

In Europe, organic growth was plus 1.7%, or 2.7%, excluding the base effects from the Olympics and the Rugby World Cup with steady progress across segments, notably in Healthcare & Seniors and Sodexo Live!. Rest of the World delivered strong organic growth of 7.5%, which was mainly driven by strong performance in India, in Australia and Brazil, which remain key countries where we are strengthening our positioning and consolidating our market share. And overall, close to 86% of our revenue in this segment are generated by Business & Administrations services.

On margins, North America was stable at constant currencies, while Europe and Rest of the World improved 20 basis points, lifting the overall margin for the group of 10 basis points, to 4.7%. And the margin also reflects procurement efficiencies and benefit from our Global Business Services Program.

So now let me guide you through the full P&L picture. Fiscal '25 consolidated revenue reached EUR 24.1 billion, up 1.2% year-over-year. As already mentioned, we faced currency headwinds this year, mainly from the U.S. dollar and several Latin America currencies, which had a minus 1.8% negative impact on revenue. And we also saw a small net impact from acquisition and disposal of minus 0.3%.

Underlying operating margin, as we discussed, was stable on the reported basis and improved 10 basis points at constant currencies. Other operating income and expenses reached minus EUR 154 million with minus EUR 97 million of this related to restructuring and efficiency initiatives covering our global business service program, ERP implementation and other organizational optimization.

Operating profit came in at close to EUR 1 billion compared with EUR 1.1 billion last year. Net financial expenses were EUR 88 million, lower than expectation due to some one-off gains. The new USD bond issuance had little impact this year as higher coupons were largely offset by cash interest income and gains from tendering existing bonds. However, net financial expense will increase next year as a result.

The tax charge was EUR 198 million with an effective rate of 22.2%, reflecting updates on the tax credit and use of previously unrecognized tax losses in France. And looking ahead, our normative tax rate is expected to be around 27%. As a result, group net profit reached EUR 695 million, translating into EUR 785 million of underlying net profit, which was up 3.7% at constant currencies.

So let's now turn to cash generation, which remains a key strength for the group. Free cash flow in fiscal '25 was EUR 459 million, compared with EUR 661 million last year. The change in operating cash flow mainly reflects the exceptional tax outflow for around EUR 160 million related to the finalization of the tax audit in France. Working capital remained well contained and net capital expenditure increased by 3%, translating into a CapEx to sales ratio of 2%, broadly in line with last year.

Acquisition net of disposal amount to an outflow of EUR 93 million following the acquisition of CRH Catering in the United States and Agap'pro, a GPO in France. Both acquisitions fully aligned with our strategy to strengthen our convenience business in the U.S. and our procurement capabilities. Overall, our free cash flow remains solid, supporting both reinvestment in the business and shareholder returns.

Then at the end of the financial year, net debt stood at EUR 2.7 billion, which was slightly higher than last year, while EBITDA increased by 2% over the same period. So this translated into a net debt-to-EBITDA ratio at 1.8x, within our target range of 1 to 2x.

During the year, we repaid the EUR 700 million bond maturing in April 2025 and successfully issued a USD 1.1 billion bond. And part of the proceeds was used to repurchase some of our 2026 bonds. Overall, the balance sheet remains solid and give us the flexibility to invest in growth.

So now that we have looked at the performance and the financials for the year just ended, I'd like to take a step back and talk about how we are accelerating our investment in foundations that will drive our long-term efficiency and profitable growth. This is really a strategic phase for the group as we are making significant investment into our HR, finance and supply system and our food and FM platform. In short term, this will put some pressure on margin, but it is essential that we position ourselves for improved efficiency and stronger profitable organic growth.

We will continue to invest in sales and marketing, especially in North America to ensure more consistent net new business, as Sophie stated earlier. An important part of our investment program is supply chain management with a strong focus on the U.S., where we are optimizing processes, systems and ways of working to improve both cost and agility. The idea is really to bring more sites into a single unified purchasing system, giving us much better visibility on spend and allowing us to track compliance in real time.

We are also standardizing our menus and recipes, so that they automatically link to order guides and purchasing system. And that means simpler execution for our site manager, stronger compliance and more leverage from our volume, including greater pooling between our on-site operations and Entegra. All of this is about making compliance and efficiency happen at the site level, and we are now incentivizing our unit manager directly on compliance.

Another key area is our digital and IT foundations. Our global ERP rollout is a perfect example. It allows us to standardize end-to-end processes, secure our infrastructure, which is instrumental in all aspects of our operation, obviously, for data and performance management, but also to strengthen client account management by giving teams better visibility and faster insights.

We are also investing to enhance our analytics and AI capabilities to support better decision-making, sharper performance tracking and faster execution across the organization. Finally, Global Business Services is another major focus. We are transforming support function into a shared service model with center in Porto, Mumbai and Bogota, now employing over 900 people. And these teams are centralizing finance, HR, other functions like supply and legal. And by doing this, we are driving efficiency, standardization and innovation while also creating talent hubs for the future.

And we are already seeing some early benefits. For example, in the U.S., more than 90 positions were moved over to the Bogota center during the summer, improving competitiveness, process harmonization and supporting employee administration, recruitment and tender preparation.

So this is really the second leg of our near-term priorities. The first being the U.S. turnaround that Sophie discussed before. And this investment position us to capture growth more effectively in the future and over time, and the margin improvements will follow. It's also about building the right platform today to deliver stronger performance tomorrow.

Now moving to the outlook for fiscal year 2026. As we mentioned previously, fiscal 2026 will mark a year of transition as we proactively address the commercial challenges faced in 2025, especially in North America. And at the same time, we are accelerating the investment in our foundation, as just mentioned, to build a stronger platform for future efficiency and profitable growth.

With that in mind, our guidance for fiscal year '26 is as follows: We expect organic growth between 1.5% and 2.5%. This includes a minimum plus 2% contribution from pricing, neutral to moderate contribution from both like-for-like volume and net new business and a one-off reclassification triggered by the renewal of a large contract. And this last point relates to a large NorAm contract currently being renegotiated. And under the new terms, we will act as an agent rather than the principal, meaning that revenue will be recognized on a net basis. And this will mechanically reduce reported organic growth by around 70 basis in fiscal year '26 with the new terms of the contract taking effect during the second quarter of the year.

And our underlying operating margin should be slightly lower than fiscal year 2025, reflecting mix and timing of growth driver and the targeted investments we are making. In terms of quarterly phasing, we expect a relatively soft start with growth gradually improving over the year. This will be mainly driven by North America, where the impact of last year's Education losses will be most visible early on. And in addition, several contracts existed last year will annualize in the second half.

Now I would like to conclude with you on our capital allocation priorities. We remain focused on disciplined execution, and that also applies to how we allocate capital. On capital allocation, framework remains balanced and consistent, designed to support both near-term execution and long-term value creation.

First, we continue to focus on organic growth, with acceleration of our investment and CapEx objectives remaining unchanged at 2.5% of revenue. We remain selective on M&A, targeting midsized bolt-on acquisitions that are accretive and aligned with our strategy. On average, we expect to allocate about EUR 300 million per year to M&A, mainly focused on convenience, GPO and food services in our key existing markets. And recent acquisitions fit perfectly within the framework and the closing of the acquisition of Grupo Mediterránea expected to happen by the end of the calendar year. It's also part of the objective to strengthen our food services position in our key markets. And this acquisition will allow us to double our footprint in Spain.

Furthermore, we are committed to optimizing returns to shareholders. Our dividend payout ratio is unchanged at 50% of underlying net income, ensuring an attractive and balanced remuneration for shareholders. And finally, we keep a close eye on liquidity and balance sheet strength, with a leverage ratio maintained between 1x and 2x and a commitment to preserving our strong investment-grade ratings. Overall, this framework supports our near-term priorities while providing the flexibility to adapt.

With that, we are very happy to take your questions.

[Operator Instructions] First question is from Jamie Rollo, Morgan Stanley.

Two questions then. First, could you please quantify the margin guidance? What is slightly lower, please? And also, is that pressure in all the regions? Or is that going to be concentrated in North America?

And the second question is, you're describing '26 as a transition year, but you said the other day that the new CEO probably wouldn't announce their review until maybe early summer, which could that not mean that 2027 then is another transition year if there were further changes to be made? Or are you going to be doing all of the implementation in 2026?

Thank you, Jamie. So I will take this first question about the guidance. So as I said, the objective is to have an operating margin to be slightly lower than fiscal year '25, reflecting really the mix phasing of our growth driver and also the phasing of the targeted investment we have to do.

Then, the reason we did not give a range is that because there are a lot of moving parts. Again, at this stage, we do expect margin to be slightly below fiscal year '25. There are different drivers. Again, the low organic growth with small optimization in terms of volume increase. And then there is a timing of the investment. And also, we do expect also some headwinds from the -- from the exchange rate that will also impact our margin. So a lot of moving parts, the reason why we decided not to quantify this guidance.

So thank you, Jamie, for your question. I will take the second question on the transition. So 2026 will be a year of transition in several ways. First and foremost, it's a year marked by a change in leadership with the upcoming arrival of Thierry as the CEO next month, on November 10.

It's also a year of investment to continue to lay the foundation for sustainable future growth. We are investing heavily in our HR, in our finance, in our procurement system, in tech and data as well as in our food and FM platform. And in the short term, this weigh on our margin, but I think it is essential to prepare for the future to be more efficient, more agile and to support sustainable growth. So for example, in the supply chain, particularly in the U.S., where we are improving our processes and system to better manage our expenses. And also, we want to increase our compliance in real time. We're also investing in data and analytics and artificial intelligence to better track the performance and execute faster.

And -- does it mean another year of transition in '27? No, we are not standing still. We have our near-term priorities, U.S. Education, as an example, the investment in the commercial, and our underlying organic growth is between 2.2% and 3.2%. So we are moving forward, and we are in the actions.

If I can -- can I just come back on the margin answer? I appreciate you can't give guidance. There are lots of moving parts. But obviously, with a margin of under 5%, every 10 basis points is quite a big impact. I mean, is slightly lower nearer to 10 basis points or nearer to 30?

Again, as I said, Jamie, we are not quantifying the guidance at this stage. We are talking about a slight decrease in terms of margin. And to also answer your question, the pressure on margin will be mostly in the U.S. because, again, as I said, our focus on accelerating investment in sales and marketing and all the supply initiatives will be also focused on strengthening our position in North America.

Next question is from Estelle Weingrod, JPMorgan.

I've got three, please. I mean the first one on U.S. Education and Higher Education more specifically. Could you give us some initial colors on the full-term enrollments? Then on North America, again, you elaborated on the action plan underway in the U.S. When you talked about targeted investment to enhance foundations for profitable growth, is it mostly investment in U.S. Higher Education? And within this, is it mostly about expanding sales higher? You mentioned 50% expansion of sales teams.

And last question is just on your -- on modeling details. You've got that slide in the PowerPoint. On other income and expense, you guide for EUR 160 million, which is broadly flat year-on-year despite the step-up in investment this year, being an investment and transition year. So I was a bit surprised there's not more of an increase there.

So thank you, Estelle. I will take the first question on U.S. Education and Sebastien can answer on the other two questions. So first, you asked on the enrollment. The early indication from our boarding data show that we are about 0.7% below last year in our comparable base, and it really varies from countries to another. Some are growing, others are slightly down.

Geographically, we're seeing softer trends in the Midwest and Northeast, while the Southwest and Southeast are showing increases. And these figures are still preliminary, and we'll have a more definitive year-on-year view once final enrollment numbers are confirmed over the next few weeks. But obviously, we are not standing still looking at that. Let me remind you the measures we are taking, and I told you, to boost volumes, retail and of course, to win new clients in the next selling season. And I explained that earlier in the presentation.

Also, if we go specifically on international students, enrollment for the fall 2025 is expected to drop due to visa delay, denial, revocation, post-graduation restriction. So it will mostly be graduate program and will be most affected. We could reduce demand for housing, dining and other campus services. And undergrad services like mandatory meal plans are less affected.

And also, what we see is that universities are adapting with, for example, mid-semester starts, which may mitigate some of that decline. And of course, we will monitor those trends closely and be ready to adjust our offering, our financial planning and the support to respond to the potential changes in the campus demand.

And also, as I said on the slide, we are really investing in our sales force. We expanded our sales team by 50%. So I think it's -- and also investing in our account management team. So we are in the action.

So on the second question regarding the investment and the acceleration of the investment in North America. So we have specific investment as described by Sophie for the Education segment. But we are really targeting investment across the organization. We want to strengthen the sales and marketing organization, not only for Education, but for all the segments. And all the investment regarding supply is not only for Education, it's, again, for all our businesses.

And on your third question. So we are guiding other income and expenses at EUR 160 million, flat versus fiscal year '25. But the combination of the different restructuring program is slightly different. We had many regional restructuring program to optimize the structure at the regional level in fiscal year '25. We will have less than in fiscal year '26, and we will increase our investment again in our GBS program. The restructuring costs related to the GBS will increase in fiscal year '26. But if we combine both, yes, it's flat between fiscal year '25 and '26.

Next question is from Jaafar Mestari, BNP Paribas.

I have three questions, if that's okay. First one is in terms of your operating models and services. You mentioned some of the qualitative targets that you've achieved this year: branded offers, more than 50% of revenue; Entegra, more than doubled; carbon emissions, minus 34%; food waste, you didn't quite get to minus 50%, but not far. There was another one on digital and new services, 10% of revenue, you haven't said, but I assume you're not that far.

My question is, you've achieved most of your soft qualitative targets and yet the overall financial performance was disappointing. What is your assessment here? Did you take targets that were not the right ones, and they need a complete rework under new management? Or was the delivery not deep enough? I guess you can get to 50% branded by changing a logo on the site. So have the teams delivered on these targets the right way, a way that benefits the business? Or have they delivered sometimes in a cosmetic way that has not really helped cross-sell or cross-fertilize the business?

Second question, shorter, just on business development. You said yourself, your average signings pre-pandemic were EUR 1.4 billion each year. In H2 '25, this is where you are, EUR 700 million. What have you seen? Is it the industry? Is outsourcing less dynamic? Or would you say it's entirely market share issues on your side?

And lastly, on full year '26, net new business, if I look at the forward-looking retention and signings, it looks like you could be a plus 1%, but you never quite get there. And I think that was one of the issues last year where you had 1.6% forward-looking, but you don't quite get there because you lose more staff, because the contracts take time to ramp up. So in terms of net new, could you help us a little bit more in terms of your assumptions in the guidance?

Okay. Thank you, Jaafar, for your question. So first -- on the first question, yes, we have delivered. I think when you talk about the offer and the branded offers and the fact that we have reached our target, I think it's a first step. No, it's not just a logo on -- it's not just a logo in a restaurant saying that we are implementing a new offer.

It is much more than a logo. It's a menu. It's a number of SKUs that are linked to that menu, and it's more compliance. So I think it's a first phase. And I agree with you that it's not driving gross profit enough yet. And we are fully aware of that and especially in the U.S. where our compliance, at the site level, is not sufficient. And that's why starting in September, all our managers are incentives, from the site manager and upwards are incentives on the compliance. It's a new -- it is for every member in the organization. I think also when you have -- so it takes more time than just sending the offer. You need to also go -- we need to go deeper now.

Second, when we talk about the, for example, the digitalization and the fact that now we have 6 million of people that can have access through -- digital access, it will also drive the revenue because we have seen that. And it will also drive the margin because we will be able to answer better what people want on a daily basis.

So on your third question, I will let Sebastien answer, and then I will get back to you on the net development.

Yes. So on the net new, you're right. I mean, the net impact, if we take the looking forward KPI, 1.4%, and then the in-year impact expected for '26 will depend obviously of the net new from '26 as well and the in-year impact. It depends on the phasing of the development, phasing of the retention. And it's the reason why we took this year a more cautious approach, I would say, baked into the guidance, as we said that the net new impact in-year expected for fiscal year '26 should be between neutral to moderate contribution. And again, the phasing development retention is explaining this cautious guidance in terms of net new impact for fiscal year '26.

And in terms of the -- the last question was about the development, right, and the EUR 1.7 billion. Clearly, this year, as I said it in my introduction, financial year '25 has been a challenging year and on new development, especially in the second half, we had a first -- a good start in H1. And what we see -- and the second half was very disappointed.

What we see is that, for example, in the U.S. our hit rate with big contract is not sufficient. I think we are doing well in Healthcare, and we had a good net development. We had, as I said, a good retention in Healthcare in the U.S. this year, but we also had a good development. So a net development above 2% in Healthcare in the U.S.

We have invested for a while in those teams. We have teams that are capable of addressing and winning a large contract. And we are in the process also of building and strengthening those teams in the U.S. in the other segment. But that being said, there are countries or geography where -- like France or like Australia, where we are winning market share and where we have a good net development rate. So we need to make it happen everywhere.

And that last qualitative target that you didn't explicitly say, the 10% of revenue from digital and new services. Did you achieve that in '25?

I'm not sure I understand your question.

I think in your qualitative target, you had doubling Entegra, and you had reaching 50% branded offers, but you also had a target to reach 10% of group revenue from vending and digital and new services. So I just wanted to check if that one was on track as well.

On that one, we are slightly below this 10% objective we defined at the beginning of the...

8%.

Yes, we are around 8% in terms of covering of -- from advanced food model.

Next question is from Simon LeChipre, Jefferies.

I've got three, please. First of all, on organic growth for next year. Could you clarify the timing of the demobilization of the global accounts and also the timing of the -- impact of the reclassification of the contract? I don't quite get why organic growth should drop from 4% underlying in Q4 to kind of 1.5% in Q1, and then how you would then accelerate in subsequent quarters.

Secondly, on this contract reclassification, could you clarify if there is any impact on profit and on margin in percentage terms? And lastly, in terms of the organization, I mean, I noticed that Michael is managing Government Services on top of universities. What is the rationale for this? And does that mean you do not necessarily believe in a strategy focused on sectorization similar to what your closest competitor is doing?

I will take the first one. So regarding the timing of demobilization of the global account, if you look at the one we lost in fiscal year '24 and the one we lost in fiscal year '25, basically, the overall impact for fiscal year '26 is minus 50 basis points. And it's -- combining both, it's similar impact between H1 and H2.

Regarding the reclassification of a large contract in North America. So here, we are talking about a preemptive renegotiation and to extend, the duration of this contract. As I said, we -- given the new term of the contract, we moved from gross revenue to net revenue. And overall, we are renegotiating the economics of the contract, and we are not expecting any significant impact in terms of margin, in terms of [ UOP ] margin.

And on the third question on organization, it -- why is it together? Because it has been historical. The person that used to be in charge of Government then extended his role to University.

Yes, of course, we are doing market sectorization. It's the only exception. I want to remind you that for us, Government is not a priority. It only represents 4% of our revenue and with a huge contract that you know, U.S. Marine Corps. And so it has been part of that portfolio. And I don't think it's -- it doesn't affect the bandwidth of -- that Michael has to put on universities. And just for the U.S. Marine Corps, because it's the biggest part of that Government business, it still runs for another 18 months. And we are working proactively to -- we expect the client to launch an RFP , but we are fully engaged in the process and also -- yes, fully engaged in the process.

And I will go back to your question -- sorry, I'll go back to your question about Q4 underlying versus the guidance in terms of organic growth. We have to keep in mind that Q4, the mix and the weight of Education is lower. So it means that this had a positive impact in our Q4 organic growth. It will not be the same for the full year '26.

And also, we had a very strong Q4 fiscal year '25 in Sodexo Live!, with a more than double-digit organic growth in the U.S. with some specific events. And this will not obviously reproduce the full year '26. We will not have 10%, double-digit organic growth in Sodexo Live! during the full year '26.

Okay. Just on this impact of contract reclassification, I mean, can you quantify it? And is it going to impact you as soon as Q1? Or does the impact start later on in the year?

Okay. So we are currently, again, under renegotiation of this contract. Again, it's a preemptive extension of the contract. Today, we are expecting to sign the renewal of the contract in Q2. So the impact will start in Q2 fiscal year '26, and it will impact negatively the organic growth by 70 basis points for fiscal year '26.

So it means that you need to accelerate organic growth after Q1 to offset this impact on top of the rest, right?

Yes. And that is the plan, again, with some ramp-up of development. And again, this phasing of Sodexo Live! will be quite different between fiscal year '25 and fiscal year '26.

Next question is from Leo Carrington, Citi.

If I could ask just two questions. Firstly, I appreciate he doesn't officially start for 3 weeks, but did Thierry Delaporte have any input into setting this guidance?

And then secondly, just on the margin outlook again. In terms of the factors pushing margins down mix phasing investments, is it correct to say these are all headwinds? And in terms of the relative importance of all three of them, is one more important than the other? The investment sounded significant, but I wonder if you can quantify that.

So thank you, Leo, for your questions. I will take the first one. So regarding the involvement of Thierry, of course, we had a few preliminary discussions with him. But I remind you that he's only starting on November 10. And however, the financial year '26 guidance reflects the work of the current team. It's also the result of a bottom-up approach based on the visibility we have for the year.

Okay. And on the investments, so we are not providing any specific quantification at this stage of each investment. We'll do it in another time, I would say. And again, there are moving parts on this timing of the investment. It's the reason why we said that, again, it will have [ this ] negative impact in terms of margin for next year.

Next question is from Kate Xiao, Bank of America.

I have a couple. The first one is a follow-up on the previous question on branded offer. You mentioned, Sophie, that now the first step is done, and you need to go deeper now. I wonder if you could elaborate what that means? Do you mean a further, I guess, change of the organization, change of the team so that it's more brand focused, more sectorized? And would this be a big task for the new CEO? That's my first question.

And the second question also on just investment. I think, Sophie, you mentioned before for fiscal year 2024, you spent more than EUR 600 million on IT, data, digital. I wonder what that number is for '25? And do you see a step-up in '26? If you could just -- obviously, I appreciate you cannot give us exact numbers, but the level of step-up would be really helpful.

And then just number three, specifically on retention. I think you mentioned that you're doing preemptive renegotiations with big contracts. I guess, any progress there? Are you doing more in terms of preemptive retention -- preemptive efforts to help really with retention? If you could elaborate on the efforts there?

Okay. So I will take the first question on the branded offers. I think it's a work, as I said, that started a couple of years ago. And when I mean go deeper, it's that -- for example, we are implementing in Education a brand that -- are -- one and all brand, it's close to EUR 1 billion of revenue, thanks to the active conversion of the sites during summer break. Now it's our largest brand globally and regionally. So it means that now the team have adopted the brand, but then we need to make sure that the implementation is happening right, that the right recipes are implemented, that the right menu, the right products.

And it's by -- when I mean go deeper, it's making sure that operationally, it happened on each and every site the way it should happen. That's why I explained that, for example, in the U.S., where -- when you implement a brand, like I just said for University, it implies a lot of people. We have also added for every single manager the compliance because that's what will improve the margin and the profitability on those sites.

And then about Thierry, of course, he will make his assessment of the situation. But definitely implementing the brands and not just putting names but an offer with -- that matches the client and also especially the consumer needs with price points, more standardization, less SKUs, better leverage on our purchasing powers simplifying the bid process. All that takes time, but it will definitely help us make progress.

Maybe, Sebastien, you want to answer the second question?

On the investment in IT and digital, based on all the ongoing program, we have been increasing our investment if you take OpEx and CapEx in fiscal year '25 compared to fiscal year '24. And again, with this acceleration of our transformation with the ERP, with the finance supply platform, the food platform as well, AI and data, again, this amount will continue to increase for fiscal year '26.

And in terms of retention, as we said, we have made progress, and there are areas or countries where we are fully aligned with our targets, to be above 95% and at some point, in midterm, at 96%. And on the preemptive bid, yes, we are pushing. I don't have the exact number with me today, but we can get back to you. And we are definitely pushing, and it's something that we want to make happen, as I said, not just in some geography, but all geography and all segments, especially in the U.S.

Next question is from Sabrina Blanc, Bernstein.

I have three questions from my part. The first one is regarding the branded offer. I would like to have more idea of how it has been organized. I mean, who has designed the brand, who is in charge of the leadership of the brand?

My second question is regarding -- you have mentioned the hiring of commercials. I would like to understand in which areas specifically, if it's regarding the GPO for new commercial? Or is it commercial dedicated to the retention? And are they incentivized in these three key segments?

And lastly is regarding the M&A. You have mentioned bolt-on acquisition, but we would like to understand in which areas you are focusing and what are your KPIs?

Okay. Thank you, Sabrina. So for the branded offers, for example, I just discussed, all in one, in the Education market in the U.S. This brand has been designed one and all -- sorry, in the U.S. in the University business. It has been designed by the team in Universities and getting some support from the North American marketing team. There are some brands like Modern Recipe where we have -- that we have implemented in different countries, in the U.S., but also in Europe. And there, we have a center of expertise at the group level, so we can accelerate the share of best practice between countries.

And -- but it's the countries that are responsible for growing the brand at the local level by segment because, of course, those offers are different what we propose, an indication is different from what we propose with a Modern Recipe or Good Eating Company in corporate services, even though sometimes Good Eating Company, if there is a need, could also be proposed on a campus. But the brands belong where most of the revenue happen with that brand.

On the second -- your second question about commercial: in which area specifically? Well, in all areas. Now we hired a number of salespeople with -- in the GPO and in our Entegra business and especially in the U.S. But we also hired -- as I said, we want to increase our sales team. And we have increased our sales team, I think, in the U.S. by 30% this year.

And how are they incentivized? We have changed the incentive for our sales team. And we have revamped our sales incentive structure. Previously, it varied by region and wasn't always linked to the individual performance or profitability. Now we have a global commission that based system with a consistent rule across the region. It includes clear threshold and accelerators for over-performance and staggered payouts to ensure quality and overs.

And we also -- we have also added specific incentives for renewals, cross-selling and strategic priorities. So in terms of sales incentive, we have worked a lot. And now it's really rolling out, and it's really implemented for fiscal year '26, but we have really worked a lot on making sure that we have the right incentive and also the right teams. We have changed a number of people in our sales team.

And to the third question regarding M&A. So we have a very clear strategy regarding M&A. We want to invest in food. We want to invest in our existing markets. And then we have done investment in GPO, especially in Europe over the past year and especially in France in fiscal year '25.

We are also investing, and we have been investing since 2022 in convenience in the U.S. So here again, we are talking about small, midsized bolt-on acquisition, very important to get the scale and the efficiency with the supply. And then we want to invest in also a key market on food, again, market share in the U.S., in Europe, also in the Rest of the World, but again, focusing on our key existing markets. A good example is the acquisition, the signing of Grupo Mediterránea in Spain. It will allow us to double our footprint in the Spanish market.

And also, we can also do some small acquisitions to gain capabilities in advanced food models. It can be also linked to commissary and central kitchen capabilities. And in terms of indicators, [ LGO ] payback, we look at the [ LGO ] payback below 10 years. And we looked at the ROCE and the objective is to have a ROCE above 15%.

Next question is from Andre Juillard, Deutsche Bank.

Just a follow-up on investments in general. Could you give us some more color about what you plan to do in terms of IT and reporting software? Do you still have some significant investment to do on that side? And could you give us some quantification on that? And regarding CapEx, you remain relatively low with 2% compared to your main competitor. Do we need to anticipate a significant improvement on that side or not?

So I will start with the CapEx. So you are right. Today, our CapEx level is around 2%, fiscal year '24 and fiscal year '25. The objective is really to reach 2.5% with, I would say, two main components. The first one is supporting retention and development. So we need CapEx to sign large deals. And as we said before, this is one of our priority. And then we need also CapEx for the -- our investment in IS&T and digital, especially for our ERP program. So this is really the reason for the targeted increase in terms of CapEx.

And just to add to what Sebastien just said, in terms of CapEx, as I said -- and as I said also earlier, we want to sign more large deals, and we want to improve our hit rates on large deals. So the way that happens, the large deals are the one where we spend more money. And the fact that our hit rate has not been as good as expected explain also the fact that our CapEx today is closer to 2% than 2.5%. So hopefully, when our hit rate with those big targets improve, it will have an impact also, and it will automatically increase the percentage of our CapEx, and we will get closer to 2.5%.

But you still consider that 2.5% is the right number?

Yes. Well, we have been talking about 2.5% and still staying at -- so far now, we really want to reach 2.5%. And if you know, some specific deals that sometimes it happens in Sodexo Live! or in Universities in the U.S., if we need to go beyond, we will go beyond but not systematically.

Next question is from Johanna Jourdain, ODDO BHF.

Two questions from me. First one, could you please remind us the level of renewals in large contracts to come in '26? And can you update us on where you stand there on those renewals? And second question, can you update us on the ramp-up of the Healthcare contracts that were delayed in '25 or late to start and in particular, the captive contract in North America?

So thank you, Johanna, for your question. So the level of renewal for the large contract, I think you're talking about the GSA contract because last year, we had -- in fiscal year '24 and '25, we had a big number of those GSA contracts in renewal. And today, this fiscal year, we don't have any. So there will not be any renewal of those large contracts and a very small number also for fiscal year '27. The contract that we discussed earlier is not -- it's not a global account. And so that's for a clarification on those large contracts.

And then for captive, first, last year, we talked about the ramping up of Healthcare and especially that contract. We have had two big contracts in Healthcare, ProMedica and University of Cincinnati that started in June and July. So there, we are on track. And as I said, we had a very good net development for Healthcare during the fiscal year '25.

For captive, during the first year, as I remind you, it was a very innovative contract. And the first year, we spent more time and focus than anticipated in evaluating the existing client for the transition into the captive program. And this led, as you know, to a slower-than-anticipated ramp-up of new business. We signed the very first contract with captive members at the end of financial '25. Currently, we are negotiating with a significant number of clients. The pipeline is well advanced and robust. And our objective remains unchanged to sign over EUR 100 million in contracts within the first 2 years of the program. But since the launch was shifted to the end of fiscal year '25 instead of the beginning of '25, our target is now to reach EUR 100 million in signed contracts across '26 and '27.

We have no further questions registered at this time. Back to Sodexo for any closing remarks.

Well, thank you very much for your question. And as this is my last call as CEO, I would like to sincerely thank you for all your -- for your engagement and your constructive dialogue over the years. I remain deeply confident in Sodexo's strength, and I look forward to continuing to support the company as Chairwoman. Thank you very much, and take care.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

Good morning, and thank you for standing by, and welcome to the Sodexo call this morning. [Operator Instructions]

I advise you that this conference is being recorded today, Thursday, the 9th of October 2025. I would now like to hand the conference over to the Sodexo team. Please go ahead.

Good morning, everyone, and thank you for joining us on such short notice. I'm Juliette Klein, Head of Investor Relations. Joining me on the call today is Sophie Bellon, our Chairwoman and CEO; and Gilles Pelisson, Independent Board Director, Chair of the Nominating Committee. After their opening remarks, we will open the line for a few questions. We kindly ask you to limit the number of your questions and keep them focused on today's topic. Finally, a reminder that fiscal 2025 results will be announced on Thursday, October 23. With that, I now hand it over to Sophie.

Thank you very much, Juliette. Good morning, everyone. And yes, thank you very much for joining us this morning. Yesterday, the Board approved the appointment of Thierry Delaporte as Chief Executive Officer of Sodexo, effective November 10. Following our announcement, we felt it was important to give you additional context today around this key milestone in our company's journey. This decision is the result of a governance process the Board has been working on for some time.

And 4 years ago, when I stepped into the CEO role, our priority was to complete a deep transformation and reposition the group as a pure-play food and services company. Having completed this transformation, we are now entering a new chapter for the group, one, that will focus on commercial acceleration and operational execution to unlock the full potential of our business. We operate in a dynamic expanding market. Our business model is resilient, and we provide essential services, benefit from recurring demand and generate strong cash flows. We also have the financial flexibility to reinvest in growth while continuing to deliver value to our shareholders.

We have made significant progress, yet our performance remains below our expectation and not up to the potential of the market. The bridge that gap -- the bridge to gap -- to bridge that gap, sorry, we need the right leader to take the company forward. I'm very confident that Thierry is that leader. Upon his arrival, I will serve as nonexecutive Chairwoman of the Board, working closely with him to ensure a smooth transition. Thierry will be fully empowered to make decisions, set his own strategy priorities and evaluate the organization. I will now hand over to Gilles Pelisson, Independent Board of Directors at Sodexo, Chair of the Nomination Committee and who also will become our new Lead Independent Director from November 10. Gilles will say a few words about the process that led to this important nomination.

Thank you, Sophie, and good morning, everyone, and I'm very pleased to join you today and share a few words about this important deployment. I would say as President of the Nomination Committee, I had the privilege to lead thorough and structured process, working closely with the Board to ensure we identify the best profile for this role. We hired a leading executive search firm, assessed both internal and external candidates.

We were looking for someone who had already led, of course, a publicly listed company in an international environment. Somebody who knows the U.S. market quite well, given the size of the business of Sodexo in the U.S. Who has driven major transformation while delivering results in fast-changing environment. And somebody who could bring a strong B2B services background with a strong client-centric mindset. Somebody also accustomed to leading large organization, we're talking about over 400,000 people at Sodexo, with sizable workforces. And finally, of course, somebody who had worked, if possible, in a family ownership structure because this is one of the characteristics of course of Sodexo.

So from a very large number of people we screened, Thierry Delaporte stood out as the clear choice. He has spent more than a decade in the U.S., holding senior CFO and CEO roles at Capgemini. And then over the 4 years, where he was the CEO of Wipro, about half of the business of Wipro was generated in the U.S. So he spent a lot of time there. He knows that market very well. He brings also proven experience in a large-scale company transformation, including the strong IT, digital dimension, highly relevant, we believe, to Sodexo's future necessity to improve data, mining and AI.

He has also extensive B2B experience, driving international and people-intensive businesses. His leadership style combined strategic vision, operational discipline and the ability to inspire and mobilize team. And of course, beyond these credentials, Thierry embodies the values we hold dear at Sodexo and we inherited from Pierre Bellon, humanity, openness and responsibility. His ethical standards and transparent approach are a strong fit with Sodexo's culture. So Sophie now, I will hand it back to you to wrap up.

Thank you very much, Gilles, and thank you for your involvement in this very important process. The timing is right for this transition, and I'm convinced of our ability to succeed with our talented teams and resilient business, Sodexo is well positioned to keep evolving with intent and to embrace the future with clarity and ambition. So I also -- yes, I really want to thank everyone who contributed to this process and especially who was very much involved. We are now happy to answer your questions.

[Operator Instructions]

The first question is from Jamie Rollo, Morgan Stanley.

First question is, could you just confirm that 2025 is in line with your guidance? And are you still expecting to provide some guidance with the 2026 results -- sorry, 2026 guidance with the results next month?

And then just on today's discussion, are you expecting the new CEO to do a review of the business? And if so, how long might that take? And then finally, you talked about new commercial acceleration and better operational execution. What sort of needs to be done, do you think, to get there? Do you think margins need to be taken down with further reinvestment?

So regarding business performance in fiscal year, we are referring to the guidance framework we gave in July. And and that's it. Today, is not a call. We are in a quiet period. We cannot give any information on guidance on results. It's about the CEO nomination. And same thing for the financial '26 guidance. We cannot discuss any of that today. And it will be part of our call on the 23rd.

So the review of the business of the new CEO, yes, of course, he will be -- he will start -- he starts to have a meeting today actually with a member of the team. So even before he starts his role on November 10, he will start getting to know the team and visiting the team in countries. He will start on November 10. And of course, as a new CEO especially one coming from outside with his expertise, and he will take a few months to make his own diagnosis. And I think we -- he will be able to come back to the market before in the spring or in June in '26.

And on the fourth question, on the new commercial acceleration, it's -- it is a continued intent. When I took over post COVID, the net development was negative and had been negative prior -- not because of COVID, but prior to COVID. Since then, I think we have made a lot of progress. We are doing a very good job in Sodexo Live!, in Australia, in India, in Brazil, in France.

We have done a good job also in hospital this year in the U.S., but there are still some countries where our net development is 2 weeks, some countries in Europe, in the U.K. also, it's a little weak and some segment in the U.S. that we have already discussed with you before, like education.

Yes. It's a call on the government. So I'm just repeating what was already said before, but let's meet in 2 weeks to discuss the results.

And apologies for asking that question. I was just wondering how you could guide on next year if the CEO subsequently went on to take action that could affect that guidance, but I understand.

The next question is from Jaafar Mestari, BNP Paribas Exane.

I just wanted to come back on the selection process, please. And in terms of it's how would the Board presents the track record of Mr. Delaporte today, he spent some time at Capgemini. He then led Wipro, which you mentioned. I don't think anyone on this call is in IT services experts, but it looks like Wipro was a story of catching up with peers and accelerating growth and reweighting to maybe large, larger clients, a lot of these themes will be familiar with -- for people at Sodexo. I guess, how do we assess the track record? And what were the main achievements in these mandates that made Mr. Delaporte the right fit, please?

Well, maybe I will take this answer. I think we -- the way we look at it was really that having been for 20 over years, at Capgemini in the leading team under Paul Hermelin, he was like a #2, but in charge of very large businesses. He accomplished the booster plan, which was really when Capgemini decided to stay in the U.S., which was a major and significant move for them at the time where they really were asking themselves whether they should pull out or not.

So building on this, we are talking about somebody who has tremendous experience coming from a more of a CFO background and moving into sales. We discussed with him and we saw how client oriented he is and over the recent years, he has really been involved both in Capgemini and in Wipro with clients and being very, very just focused on client development.

At Wipro, my understanding and the read we made was that -- it's one of the IPPs. He took it. The company was like at $8 billion in sales, took it to $11 billion. So significant improvement between '20 and '24, growing the sales, upgrading the management team, internationalizing the team. So making sure that Wipro could evolve part of the 5 or 6 IPPs and really make a significant jump ahead under his leadership.

Under his leadership, not only the sales grew up, of course, the workforce went from 150,000 people to 250,000 people and the market cap was doubled. These were significant achievements that as the Board, we assessed to be a tangible transformation performance that we like very much, which may be very relevant for Sodexo because we know that in general, assume the previous question, there is certainly to be a focus on margin in the future. So targeting excellent performance in margin delivery.

And of course, also the consolidation of certainly the IT is an issue. We know that we need to invest in those -- in this field. And with his technological and digital background, we think it will be a real help.

The next question is from Estelle Weingrod, JPMorgan.

I have 2 questions, please. The first one, I just wanted to understand when did the process start. And also, again, on his background, could you tell us more about his U.S. expertise and what it can bring to Sodexo's overall competitiveness, more specifically? Or is it more about him having worked in large organization in the same region before?

So thank you, Estelle, for your question. For -- the process really started quite a few months ago, I'm not going to give you -- but early in the year. So it has not -- it was very much -- something very much planned. And why that? Because when I took over as a CEO post-COVID, I really took over to make some structural milestone changes and I think it's what happened in the last 4 years with the spinoff of Pluxee in February '24, with the simplification of the shareholding structure the last summer, also an active management of the portfolio, selling the TieCare business, selling the home care business, rationalization of the country, we also -- as soon as I took over, I simplified the organization changing from business world, a business unit segment organization to a country-based P&L and we worked on the operating model.

We refocused on food and accelerated on food and also other services, but a strong acceleration of food. We did some investment in our brands, in our tech and data in the supply chain. So I really think that the big structural changes that needed to happen, happened during those 4 years. But now we realize that '25 is the end of the cycle. We have a 3-year plan, '22-'25. We are launching -- starting a new phase and with the Board, with the family, with the Nomination Committee, we anticipated that new phase and that's why we decided to launch that process.

And as Gilles said, we look for internal candidates, but very quickly, we didn't think that internally, we had anyone ready for this role. So that's why we quickly looked outside. And really, I'm very confident that Thierry is the best person to open this new chapter. And I can tell you that personally, I will really change my hat and become the non-executive Chairwoman and he will be fully empowered to continue the journey, make his own diagnosis and build the best team around him.

And maybe, Gilles, you can answer on the U.S. expertise.

Yes. For having discussed with him extensively and myself having lived in the U.S. for 8 years, he knows very well the U.S. in terms of geography. It's not the same thing doing business in Texas and in California or in New York City. He knows the U.S. business structure, the way corporations make decisions are organized, et cetera, even the administration also, although it's changing a lot recently, but he has this approach, so he is not going to have a long learning process to how to do business in the U.S. environment.

And as you know, Sodexo's business in the U.S. is very diversified, goes from universities to health, to corporate to Sodexo Live! with lounges, with managing Stadium. So we wanted somebody who was able to take over quickly, had a good grasp on the business, and then lead the team in a significant way because this is important for the company and important for our growth.

So this is why we felt very much at least with his knowledge, capitalizing on experience with Capgemini and also with Wipro.

The next question is from Leo Carrington, Citi.

Can I ask two questions. Firstly, what was Mr. Delaporte's rationale for leaving Wipro? And then secondly, the release does draw attention to his acquisition experience. Does that suggest more of a focus for Sodexo on M&A?

I'm sorry, we didn't hear your first question, Leo. Can you repeat, please?

Yes. Sorry, the first question was just around his rationale for leaving Wipro in 2024.

And the second?

On M&A.

The second question is, the release does draw attention to his M&A experience. Is it indicative of more of a focus for Sodexo or just highlighting what his experience is?

Yes. So first, on the rationale for leaving Wipro, I don't think it's something that we want to answer. But what we know is what he has done there. And what we know we have done there is that he has been transforming in 4 years. He has been transforming significantly the company. As Gilles said, he also increased the revenue by 40% in 4 years, which is significant, and he doubled the share value of the company, the capitalization of the company also in 4 years. So he has -- and that's what matters for us.

And also, as Gilles said, coming from a tech background, transforming organization and having done it with many clients, I think we will -- in the journey, we are going through at Sodexo. It will be very helpful to get that expertise. Then on M&A, when I first took over, clearly, I said M&A is not a priority. But since then, you heard us with Sebastien, we said that now it's time to go back to M&A to increase our market share, work on -- also be more present in convenience, especially in the U.S., also look for the right targets in our GPO business.

So we have a clear capital allocation that reflects our near-term needs at Sodexo. You've seen that we just announced quite significant acquisition in Spain, where we are going to double size and become #1. And we continue to have an active pipeline. As I said a year ago that now we were more ready for M&A, and he will, of course, make his own diagnosis and on that topic.

My understanding was that at Capgemini, there was a lot of M&A activities. So we wanted somebody with that kind of agility so that if we have opportunities to do so, it could be familiar with the process and the way we could handle those situations.

The next question is from Karl Green, RBC.

I've just got 1 question. If Thierry identifies a scenario where more radical action is the most logical strategy to close the performance gap versus the market. And I'm thinking, for example, accelerated contract shedding investments into sales, account management technology, et cetera, possibly large-scale M&A, would Bellon SA contemplate taking the group private moving to and voting or economic minority?

We did not hear you very well. Can you speak a little louder because we -- I'm not sure I heard very well the question.

Yes, apologies. Can you hear me a bit better now?

Yes, a little better, yes.

Okay. The question was, if Thierry identifies a scenario where more radical action is the most logical strategy to close the performance gap, would Bellon SA contemplate taking the group private and moving to a voting or economic minority.

Yes. I think the good news here is that we manage as independent directors to have an ongoing discussion with the Bellon family and a good understanding what was right for the company and for the group. As major shareholders, of course, they are the most interested in the success and the growth of the company. And of course, they are not satisfied at this stage with our recent performance, especially on the share side. So making sure that Thierry is in an environment where the decision and the -- whatever he wants to implement in the company can really happen is key to everybody.

And as Sophie mentioned, she will step down as a non-exec Chairwoman. And we are going to make sure that we have a new governance, which can function and operate in the best interest of all shareholders. So I think this is what you should keep in mind that have definitely the intent to put in place that kind of governance to make sure that we can deliver results and that if he needs to take whatever actions he recommends and that we agree, it will have the full support of the entire Board, including the family.

The next question is from Kate Xiao, Bank of America.

Two from me. First, just if you could elaborate on kind of the task that the Board has given to the new CEO in terms of time line and geographies. You kind of mentioned earlier that you expect him to kind of first come to the market after the initial diagnosis in about 6 to 8 months, around June. But I just wonder, what's the kind of multiyear time line like with the task? Is there a time limit to the term of the CEO? What is he looking to accomplish in the first couple of years, if you could lay out that time line?

And in terms of geographies, we've talked a lot about the U.S. It sounds like that's where he has a lot of expertise. Is it going to be based in Europe or the U.S. And so what are some of the other geographies that you also focus on? And kind of -- I guess, what are the priorities there?

And then my second question is, I think one of the things he was known for when he was CEO at Wipro was he was making big and bold moves, transforming the organization, which is exactly what Sodexo needs. He was also more focused on growth than margins. So just wondering if that's the thinking of the company now that you're willing to kind of be focused more on growth. You talked about investments, but maybe the thinking of investing growth and then margin will come later.

Yes. We are really looking at profitable growth, so to speak. So it's growth, but combined with profitability and margins. To go back to your first question, I think we -- what the board is looking at, and this is also going to be fine-tuned in the coming months. As Thierry goes around the world and discovers, meets the team and sees the challenges, et cetera, but it's really about setting up a very strong ambition to strengthen our market share because we have been losing some in the past month. So we have to be really on top of that. Mobilize the right leadership team, which has anybody who joined a new team, I'm sure he will make his own assessment and his own choices, accelerate the commercial momentum because this is critical, of course, as Sophie mentioned, and she has always been very focused on that, what is called in Sodexo language, the new development, reinforce disciplined operational execution to improve margins.

So that's really your question. And this is really something where we all believe there is margin for improvement. And it's based on the systems, it's based on the discipline, on the execution. And we do believe that Thierry can bring something here, which will be important. And then, of course, regarding geographies, I think definitely the U.S. needs to be addressed. Maybe there are some other geographies that you have in mind.

As I said, I think we are doing -- we are performing well in the U.K., for example, in terms of margin. But definitely, we need more development. We need more growth, more new contracts, certain countries in Europe, but I think that we can discuss in 2 weeks because it's not the topic of the -- it's not the topic of the day. Then I think you asked where will Thierry will be based. He will be based in Paris, but he also has a room in the U.S. So he will travel very easily to the U.S. And I think that's it.

Gentlemen, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.

Okay. Well, thank you very much, everyone, for joining the call today. Don't hesitate to reach out to our investment -- Investor Relations team to Juliette and her team. If you have any follow-up questions, and we will speak again at the fiscal year '25 results on Thursday, October 23. Thank you again, and have a very good day.

Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.