Q2 2026 Kiloutou SAS Earnings Call
Speaker #2: Your line is muted.
Speaker #3: Call recording is on.
Speaker #4: Good morning, and welcome to the Kiloutou-Kapla Holding Q2 2026 financials conference call. The call will be structured in two parts: first, a presentation by the Kiloutou Group Management Team, and afterwards there will be a Q&A session.
Operator 2: Good morning, and welcome to the Kiloutou CAPA Holding Q2 2026 financials conference call. The call will be structured in two parts. First, a presentation by the Kiloutou Group management team, and afterwards there will be a Q&A session. During this session, you may ask question in two ways: by clicking the blue hand icon on the player to ask your question orally, or by joining the conference call and dial pound key five on your telephone keypad to enter the queue. I will now hand over to Olivier Colleau, CEO, and Antoine Clech, CFO. Gentlemen, please go ahead.
Operator: Good morning, and welcome to the Kiloutou CAPA Holding Q2 2026 financials conference call. The call will be structured in two parts. First, a presentation by the Kiloutou Group management team, and afterwards there will be a Q&A session. During this session, you may ask question in two ways: by clicking the blue hand icon on the player to ask your question orally, or by joining the conference call and dial pound key five on your telephone keypad to enter the queue. I will now hand over to Olivier Colleau, CEO, and Antoine Clech, CFO. Gentlemen, please go ahead.
Speaker #4: During this session, you may ask questions in two ways: by clicking the blue hand icon on the player to ask your question orally, or by joining the conference call and dialing #Key5 on your telephone keypad to enter the queue.
Speaker #4: I will now hand over to Olivier Kollo, CEO, and Antoine Clesh, CFO. Gentlemen, please go ahead.
Speaker #5: Thank you, and good morning, everyone. My name is Olivier Kollo. I'm CEO of the group, and I will be here this morning with Antoine Clesh, Group CFO, for this presentation.
Olivier Colleau: Thank you, and good morning, everyone. My name is Olivier Colleau. I am CEO of the group, and I will be this morning with Antoine Clech, Group CFO, for this presentation. The investor of the call this morning is to discuss the results of the second quarter of 2026. I will go through the quarter's key achievements and our business performance. Antoine will then deep dive into our financial results, and I will finally share with you our views and priorities for the next few months. We will have time at the end of the session to take all questions you might have. Let's get started on page 4 with a brief overview of Kiloutou. We are the third rental company in Europe. We are number 2 player in France, number 1 in Denmark, number 1 in Portugal.
Olivier Colleau: Thank you, and good morning, everyone. My name is Olivier Colleau. I am CEO of the group, and I will be this morning with Antoine Clech, Group CFO, for this presentation. The investor of the call this morning is to discuss the results of the second quarter of 2026. I will go through the quarter's key achievements and our business performance. Antoine will then deep dive into our financial results, and I will finally share with you our views and priorities for the next few months. We will have time at the end of the session to take all questions you might have. Let's get started on page 4 with a brief overview of Kiloutou. We are the third rental company in Europe. We are number two player in France, number one in Denmark, number one in Portugal.
Speaker #5: The purpose of the call this morning is to discuss the results of the second quarter of 2026. I will go through the quarter's key achievements.
Speaker #5: And our business performance. Antoine will then deep dive into our financial results, and I will finally share with you our views and priorities for the next few months.
Speaker #5: And we will have time at the end of the session to take all Q&A, all questions you might have. So let's get started on page 4 with a brief overview of Kiloutou.
Speaker #5: We are the third-largest rental company in Europe. We are the number two player in France, number one in Denmark, and number one in Portugal. In total, we operate in nine countries.
Speaker #5: Across Europe, with roughly 650 branches and around 7,300 employees. Let's move on now to page 5 and browse the main achievements we delivered during the second quarter of 2026.
Olivier Colleau: Totally, we operate in nine countries across Europe with roughly 650 branches and around 7,300 employees. Let's move on now to page 5 and browse the main achievements we delivered during the second quarter of 2026. On page 6, as you know, because it was shared during the last investor call, Kiloutou has successfully completed a major EUR 800 million refinancing operation in April. This strategic milestone strengthens the group's financial resources for the future. On page 7, discussing about the people and key managers. We are very pleased to announce three key appointments to Kiloutou's executive committee. Joanne Van Doesburg joined as Group HR Director. Jan-Luc Ambre, whom you all know, stepped into a new role for him, which is the role of International Director after eight years as Group CFO, and Antoine Clech, formerly Deputy Group CFO, succeeded Jan-Luc as Group CFO.
Olivier Colleau: Totally, we operate in nine countries across Europe with roughly 650 branches and around 7,300 employees. Let's move on now to page 5 and browse the main achievements we delivered during the second quarter of 2026. On page 6, as you know, because it was shared during the last investor call, Kiloutou has successfully completed a major EUR 800 million refinancing operation in April. This strategic milestone strengthens the group's financial resources for the future. On page 7, discussing about the people and key managers. We are very pleased to announce three key appointments to Kiloutou's executive committee. Joanne Van Doesburg joined as Group HR Director. Jean-Luc Ambre, whom you all know, stepped into a new role for him, which is the role of International Director after eight years as Group CFO, and Antoine Clech, formerly Deputy Group CFO, succeeded Jean-Luc as Group CFO.
Speaker #5: On page 6, as you know—because it was shared during the last investor call—Kiloutou successfully completed a major €800 million refinancing operation in April.
Speaker #5: This strategic milestone strengthens the group's financial resources for the future. On page 7, discussing people and key managers, we are very pleased to announce three key appointments to Kiloutou's executive committee.
Speaker #5: Johan van der Berg joined as Group HR Director. Jan-Luc Ambre, whom you all know, stepped into a new role for him, which is the role of International Director after eight years as Group CFO.
Speaker #5: And Antoine Clesh, formerly Deputy Group CFO, succeeded Jan-Luc as Group CFO. On page 8, we are delighted to highlight that at Kiloutou Spain, we received Great Place to Work certification for 2026.
Olivier Colleau: On page 8, we are delighted to highlight that Kiloutou Spain received Great Place to Work certification for 2026, and Kiloutou Italy was awarded Employer Gold. These two recognitions underline our strong groupwide employer branding, and we are very proud about it. On page 9, among other achievements, we have officially launched in France, One Kiloutou, bringing our entire portfolio of equipment and specialist services together under a single point of contact to our customers. This clearly strengthens, again, the quality and the breadth of offering we make to customers. As you can see, it has been a busy quarter in terms of achievements. Let's now move on to page 10 and look at our financial performance during the quarter. On page 11, as you can see on this page, we kept on growing in this second quarter of 2026 in comparison with Q2 2025.
Olivier Colleau: On page 8, we are delighted to highlight that Kiloutou Spain received Great Place to Work certification for 2026, and Kiloutou Italy was awarded Employer Gold. These two recognitions underline our strong groupwide employer branding, and we are very proud about it. On page 9, among other achievements, we have officially launched in France, One Kiloutou, bringing our entire portfolio of equipment and specialist services together under a single point of contact to our customers. This clearly strengthens, again, the quality and the breadth of offering we make to customers. As you can see, it has been a busy quarter in terms of achievements. Let's now move on to page 10 and look at our financial performance during the quarter. On page 11, as you can see on this page, we kept on growing in this second quarter of 2026 in comparison with Q2 2025.
Speaker #5: And Kiloutou Italy was awarded Employee Gold. These two recognitions underline our strong group-wide employer branding, and we are very, very proud of it. And on page 9, among other achievements, we have officially launched in France "One Kiloutou," bringing our entire portfolio of equipment and specialist services together under a single point of contact for our customers.
Speaker #5: So, this clearly strengthens again the quality and the breadth of the offering we make to customers. So, as you can see, it has been a busy quarter in terms of achievements.
Speaker #5: So, let's now move on to page 10 and look at our financial performance during the quarter. So, on page 11, as you can see on this page, we kept on growing in this second quarter of 2026 in comparison with Q2 2025.
Speaker #5: Our quarterly revenues increased by 8%, 8.1%, essentially fueled by our recent acquisitions in Spain, Italy, and Ireland. While we are broadly stable on a constant perimeter, minus 0.5%, impacted by soft economic conditions in particular.
Olivier Colleau: Our quarterly revenues increased by 8.1%, essentially fueled by our recent acquisitions in Spain, Italy, and Ireland. We are broadly stable at a constant perimeter, -0.5%, impacted by soft economic conditions, in particular in France. Performance varies across geographies, with still a good momentum in southern countries, while France and Germany show resilient performance in a soft underlying market. Our EBITDA for the second quarter of 2026 increased by +10% versus last year, but slightly decreased by 0.5 points at constant perimeter. Despite the changing environment, our margins remain quite good and resilient. The EBITDA margin increased by 0.7 points to 39.5%, driven by rigorous cost monitoring and also higher equipment sales volumes year on year. Our sustained margins and our ability to control investment levels contributed to a healthy positive free cash flow of EUR 63.9 million at the end of Q2 2026.
Olivier Colleau: Our quarterly revenues increased by 8.1%, essentially fueled by our recent acquisitions in Spain, Italy, and Ireland. We are broadly stable at a constant perimeter, -0.5%, impacted by soft economic conditions, in particular in France. Performance varies across geographies, with still a good momentum in southern countries, while France and Germany show resilient performance in a soft underlying market. Our EBITDA for the second quarter of 2026 increased by +10% versus last year, but slightly decreased by 0.5 points at constant perimeter. Despite the changing environment, our margins remain quite good and resilient. The EBITDA margin increased by 0.7 points to 39.5%, driven by rigorous cost monitoring and also higher equipment sales volumes year on year. Our sustained margins and our ability to control investment levels contributed to a healthy positive free cash flow of EUR 63.9 million at the end of Q2 2026.
Speaker #5: In France, performance varies across geographies, with still good momentum in southern countries, while France and Germany show resilient performance in a soft underlying market.
Speaker #5: Our EBITDA for the second quarter of 2026 increased by over 10% versus last year, but slightly decreased by 0.5 points at constant perimeter. Despite a changing environment, our margins remain quite good and resilient.
Speaker #5: The EBITDA margin increased by 0.7 points to 39.5%, driven by rigorous cost monitoring and higher equipment sales volumes year-on-year. Our sustained margins and our ability to control investment levels contributed to a healthy, positive free cash flow of €53.9 million at the end of Q2 2026.
Speaker #5: And it also contributed to a solid and stable leverage profile, broadly stable at 3.89 times EBITDA. So, this is the overall view at group level.
Olivier Colleau: It also contributed to a solid and stable leverage profile broadly stable at 3.89 times EBITDA. This is the overall view at the group level. Let's now turn to page 13 and see the situation in France. Our second quarter revenue and EBITDA both decreased versus Q2 2025, with respectively -3.2% and -1.1%. It's a fact that the construction sector in France remained very challenging in the second quarter of 2026, impacted by the general economic environment in France. However, the diversity of our business portfolio enabled us to mitigate the impact on our revenue. In terms of EBITDA margin ended up at 42.2%, which is an increase in comparison with last year, almost one point of EBITDA margin improvement, primarily driven by our ability to mitigate cost inflationary pressures thanks to efficient cost discipline. On page 14.
Olivier Colleau: It also contributed to a solid and stable leverage profile broadly stable at 3.89x EBITDA. This is the overall view at the group level. Let's now turn to page 13 and see the situation in France. Our second quarter revenue and EBITDA both decreased versus Q2 2025, with respectively -3.2% and -1.1%. It's a fact that the construction sector in France remained very challenging in the second quarter of 2026, impacted by the general economic environment in France. However, the diversity of our business portfolio enabled us to mitigate the impact on our revenue. In terms of EBITDA margin ended up at 42.2%, which is an increase in comparison with last year, almost one point of EBITDA margin improvement, primarily driven by our ability to mitigate cost inflationary pressures thanks to efficient cost discipline. On page 14.
Speaker #5: Let's now turn to page 13 and see the situation in France. Our second quarter revenue and EBITDA both decreased versus Q2 2025, with minus 3.2% and minus 1.1%, respectively.
Speaker #5: It's a fact that the construction sector in France remained very challenging in the second quarter of 2026, impacted by the general economic environment in France.
Speaker #5: However, the diversity of our business portfolio enabled us to mitigate the impact on our revenue. In terms of EBITDA, EBITDA margin ended up at 42.2%, which is an increase in comparison with last year—almost 1%.
Speaker #5: Of EBITDA margin improvement, primarily driven by our ability to mitigate cost inflationary pressures, thanks to efficient cost discipline. So, on page 14, you have an illustration of our main achievements during this quarter in France.
Speaker #5: As I just mentioned, our resilient performance, despite tough market conditions coupled with tight cost monitoring, enabled us to maintain a high level of profitability.
Olivier Colleau: You have an illustration of our main achievements during this quarter in France. As I just mentioned, our resilient performance despite tough market conditions, coupled with tight cost monitoring, enabled us to maintain a high level of profitability. This is for France. Let's now move on page 16 and have a view at our international operations. Our international segment developed strong top-line EBITDA growth this quarter, largely driven by our recent expansion. In the second quarter, revenues grew by +25%. This is +4% at constant perimeter. Sales dynamics are well-oriented in most geographies. EBITDA was higher than last year, and it significantly grew by 29%, which is a slight growth at constant perimeter, 0.2%. The EBITDA margin remained at a high level at almost 37%, and it increased by 1.2 points versus last year, with a minor impact of capital gain.
Olivier Colleau: You have an illustration of our main achievements during this quarter in France. As I just mentioned, our resilient performance despite tough market conditions, coupled with tight cost monitoring, enabled us to maintain a high level of profitability. This is for France. Let's now move on page 16 and have a view at our international operations. Our international segment developed strong top-line EBITDA growth this quarter, largely driven by our recent expansion. In the second quarter, revenues grew by +25%. This is +4% at constant perimeter. Sales dynamics are well-oriented in most geographies. EBITDA was higher than last year, and it significantly grew by 29%, which is a slight growth at constant perimeter, 0.2%. The EBITDA margin remained at a high level at almost 37%, and it increased by 1.2 points versus last year, with a minor impact of capital gain.
Speaker #5: So, this is for France. Let's now move on to page 16 and have a look at our international operations. Our international segment developed strongly, supplying EBITDA growth.
Speaker #5: This quarter, results were largely driven by our recent expansion. In the second quarter, revenues grew by plus 25%. This is plus 4% at constant perimeter. Sales dynamics are well oriented in most geographies.
Speaker #5: EBITDA was higher than last year, and it significantly grew by 29%, with slight growth at constant perimeter of 0.2%. The EBITDA margin remained at a high level, at almost 37%, and increased by 1.2 points versus last year, with a minor impact from capital gain.
Speaker #5: The page on the next slide, page 17, illustrates our main achievements on the international front during the second quarter. The robustness of our external and organic growth, and the sustainability of our profitability, allowed us to deliver a strong performance.
Olivier Colleau: The next page 17, illustrates our main achievements on the international front during Q2. The robustness of our external and organic growth and the sustainability of our profitability allowed us to deliver a strong performance. Let's move to page 19 and look at the fleet. Our fleet CapEx decreased by 24%, from EUR 135 million to EUR 103 million. This decrease is aligned with our CapEx reduction plan for 2026, and we already mentioned it during the last call. We have this ability to adapt investments to the market conditions, which is obviously, as you know, a key success factor in our business. On the sell side, fleet disposals increased compared to last year by +20%, reflecting both phasing issue, but also a focus on a fleet rationalization. Our resale ratio on the next page, on page 20.
Olivier Colleau: The next page 17, illustrates our main achievements on the international front during Q2. The robustness of our external and organic growth and the sustainability of our profitability allowed us to deliver a strong performance. Let's move to page 19 and look at the fleet. Our fleet CapEx decreased by 24%, from EUR 135 million to EUR 103 million. This decrease is aligned with our CapEx reduction plan for 2026, and we already mentioned it during the last call. We have this ability to adapt investments to the market conditions, which is obviously, as you know, a key success factor in our business. On the sell side, fleet disposals increased compared to last year by +20%, reflecting both phasing issue, but also a focus on a fleet rationalization. Our resale ratio on the next page, on page 20.
Speaker #5: So let's move to page 19 and look at the fleet. Our fleet capex decreased by 24%, from €135 million to €103 million.
Speaker #5: This decrease is aligned with the with our capex reduction plan for 2026, and we already mentioned it during the last during the last call.
Speaker #5: We have this ability to adapt investments to the market conditions, which is obviously, as you know, a key success factor in our business. On the sales side, fleet disposals increased compared to last year by 20%, reflecting both a phasing issue but also a focus on fleet rationalization.
Speaker #5: And our resale ratio on page on the next page, on page 20, our resale ratio remained quite high and quite good at above 40%.
Speaker #5: It increased by 2.7 points compared to last year, essentially due to mixed effects. We have been selling more off-moving equipment, which has a better resale performance.
Olivier Colleau: Our resale ratio remained quite high and quite good at above 40%, increased by 2.7 points compared to last year, essentially due to mix effects. We have been selling more earthmoving equipment, which have a better resale performance. This is the overall view on our business performance. Antoine, I give you the floor so that you can go with us into more details on the financial performance.
Olivier Colleau: Our resale ratio remained quite high and quite good at above 40%, increased by 2.7 points compared to last year, essentially due to mix effects. We have been selling more earthmoving equipment, which have a better resale performance. This is the overall view on our business performance. Antoine, I give you the floor so that you can go with us into more details on the financial performance.
Speaker #5: So, this is the overall view of our business performance. Antoine, I'll give you the floor so you can walk us through more details on the financial performance.
Speaker #2: Thank you, Olivier, and good morning to everyone joining us today. We will now proceed with a comprehensive review of the group's financial performance for the second quarter of 2026, focusing on key figures prepared in strict compliance with IFRS.
Antoine Clech: Thank you, Olivier, and good morning to everyone joining us today. Yes, we now proceed with a comprehensive review of the group's financial performance for Q2 2026, focusing on the key figures prepared in strict compliance with IFRS. Consistent with our established format, this review will be structured around three principal pillars as usual. A detailed analysis of our income statement, highlights concerning our operating cash flow for the period, and finally, a specific commentary on our capital structure, leverage ratios, and debt maturity profile. Now, let's begin with an analysis of our profit and loss statement detailed on page 22. As mentioned by Olivier, during Q2 2026, we continued our growth trajectory, achieving a revenue increase of EUR 26.3 million, representing an 8.1% growth compared to the same period last year.
Antoine Clech: Thank you, Olivier, and good morning to everyone joining us today. Yes, we now proceed with a comprehensive review of the group's financial performance for Q2 2026, focusing on the key figures prepared in strict compliance with IFRS. Consistent with our established format, this review will be structured around three principal pillars as usual. A detailed analysis of our income statement, highlights concerning our operating cash flow for the period, and finally, a specific commentary on our capital structure, leverage ratios, and debt maturity profile. Now, let's begin with an analysis of our profit and loss statement detailed on page 22. As mentioned by Olivier, during Q2 2026, we continued our growth trajectory, achieving a revenue increase of EUR 26.3 million, representing an 8.1% growth compared to the same period last year.
Speaker #2: Consistent with our established format, this review will be structured around three principal pillars as usual: a detailed analysis of our income statement, highlights concerning our operating cash flow for the period, and finally, a specific commentary on our capital structure, leverage ratios, and debt maturity profile.
Speaker #2: Now, let's begin with an analysis of our profit and loss statement detailed on page 22. As mentioned by Olivier, during Q2 2026, we continued our growth trajectory.
Speaker #2: Achieving a revenue increase of €26.3 million, representing 8.1% growth compared to the same period last year. Our growth this quarter was driven by our international markets, which delivered a 25.1% increase following the successful integration of our recent acquisition, and 4% growth at constant perimeter.
Antoine Clech: Our growth this quarter was driven by our international markets, which delivered a +25.1% increase following the successful integration of our recent acquisition, and +4% as constant perimeter. However, despite this strong momentum abroad, the group's overall organic revenue is broadly stable at -0.5%, and it was primarily due to headwinds in France, already mentioned by Olivier, which offset the international trend. Broadly speaking, the market continues to face a contraction, the construction sector, and the volatile economic environment with disparities between countries. Finally, the resilience and diversity of our business portfolio, supported by strategic perimeter changes combined with robust performance in our growth market, effectively offset localized headwinds on our constant scope revenue. Our EBITDA for the quarter reached EUR 138.4 million, marking an increase of +EUR 12.6 million or +10.1% compared to last year, but slightly decreased at -0.5% by excluding acquisition.
Antoine Clech: Our growth this quarter was driven by our international markets, which delivered a +25.1% increase following the successful integration of our recent acquisition, and +4% as constant perimeter. However, despite this strong momentum abroad, the group's overall organic revenue is broadly stable at -0.5%, and it was primarily due to headwinds in France, already mentioned by Olivier, which offset the international trend. Broadly speaking, the market continues to face a contraction, the construction sector, and the volatile economic environment with disparities between countries. Finally, the resilience and diversity of our business portfolio, supported by strategic perimeter changes combined with robust performance in our growth market, effectively offset localized headwinds on our constant scope revenue. Our EBITDA for the quarter reached EUR 138.4 million, marking an increase of +EUR 12.6 million or +10.1% compared to last year, but slightly decreased at -0.5% by excluding acquisition.
Speaker #2: However, despite this strong momentum abroad, the group's overall organic revenue is broadly stable at minus 0.5%, and this was primarily due to headwinds in France, already mentioned by Olivier, which offset the international trend.
Speaker #2: Broadly speaking, the market continues to face a contraction, particularly in the construction sector and due to the volatile economic environment, with disparities between countries. Finally, the resilience and diversity of our business portfolio—supported by strategic perimeter changes combined with robust performance in our growth markets—effectively offset localized headwinds on our constant scope revenue.
Speaker #2: Our EBITDA for the quarter reached 138.4 million euros, marking an increase of plus 12.6 million euros or plus 10.1% compared to last year. But slightly decreased at minus 0.5% by excluding acquisition.
Speaker #2: Our EBITDA margins stood at 39.5%, above last year's EBITDA margin rates, driven by our ability to mitigate cost inflationary pressures thanks to efficient cost discipline, and also by a slight increase in equipment sales.
Antoine Clech: Our EBITDA margin stood at 39.5%, above last year's EBITDA margin rate, driven by our ability to mitigate cost inflationary pressures thanks to efficient cost discipline and also by a slight increase in equipment sales. Our sales of used equipment for Q2 are slightly increasing compared to last year at EUR 13.3 million versus EUR 12 million. Moving on to our product and cost line, what we can see, our equipment and service costs increased by +8.4% to EUR 88.5 million. Equipment covers as a percentage of total revenue maintained flat at 25.3% compared to 25.2% in 2025. This demonstrates our ongoing ability to tightly manage our service margins and variable costs. Regarding personnel costs, personnel costs rose by 8.6% to EUR 105.4 million, representing 30.1% of revenue versus 30% in Q2 2025.
Antoine Clech: Our EBITDA margin stood at 39.5%, above last year's EBITDA margin rate, driven by our ability to mitigate cost inflationary pressures thanks to efficient cost discipline and also by a slight increase in equipment sales. Our sales of used equipment for Q2 are slightly increasing compared to last year at EUR 13.3 million versus EUR 12 million. Moving on to our product and cost line, what we can see, our equipment and service costs increased by +8.4% to EUR 88.5 million. Equipment covers as a percentage of total revenue maintained flat at 25.3% compared to 25.2% in 2025. This demonstrates our ongoing ability to tightly manage our service margins and variable costs. Regarding personnel costs, personnel costs rose by 8.6% to EUR 105.4 million, representing 30.1% of revenue versus 30% in Q2 2025.
Speaker #2: Our sales of used equipment for Q2 are slightly increasing, compared to last year, at €13.3 million versus €12 million. Moving on to our product and cost line, what we can see is our equipment and service costs increased by 8.4% to €88.5 million. Equipment costs as a percentage of total revenue remained flat at 25.3%, compared to 25.2% in 2025.
Speaker #2: This demonstrates our ongoing ability to tightly manage our service margins and variable costs. Regarding personnel costs, personnel costs rose by 8.6% to €105.4 million, representing 30.1% of revenue versus 30% in Q2 2025.
Speaker #2: Again, this ratio is maintained flat, thanks to our strict control over FTEs and continuous operational discipline. And last but not least, overhead costs remained highly controlled, with a decrease of 2% to €28.7 million. This allowed us to reduce overhead as a percentage of revenue to 8.2%, versus 9% in 2025, successfully absorbing integration costs from recent acquisitions, new branch openings, and broader inflationary pressure.
Antoine Clech: Again, this ratio is maintained flat thanks to our strict control over FTEs and continuous operational discipline. Last but not least, overhead costs remain highly controlled with a decrease of -2% to EUR 28.7 million. This allowed us to reduce overhead at a percentage of revenue at 8.2%, that is 9% in 2025, successfully absorbing integration costs from recent acquisition, new branch opening, and broader inflationary pressure. Finally, other current expenses came in at EUR 2.4 million, primarily driven by bad debt provisions. Customer credit risk remains well controlled at just 0.6% of revenue, a testament to our robust internal processes and disciplined approach, even in today's challenging macroeconomic environment. Below EBITDA, our depreciation and amortization increased +9.3% at EUR 97.8 million, aligned with the fleet increase and driven by recent acquisition.
Antoine Clech: Again, this ratio is maintained flat thanks to our strict control over FTEs and continuous operational discipline. Last but not least, overhead costs remain highly controlled with a decrease of -2% to EUR 28.7 million. This allowed us to reduce overhead at a percentage of revenue at 8.2%, that is 9% in 2025, successfully absorbing integration costs from recent acquisition, new branch opening, and broader inflationary pressure. Finally, other current expenses came in at EUR 2.4 million, primarily driven by bad debt provisions. Customer credit risk remains well controlled at just 0.6% of revenue, a testament to our robust internal processes and disciplined approach, even in today's challenging macroeconomic environment. Below EBITDA, our depreciation and amortization increased +9.3% at EUR 97.8 million, aligned with the fleet increase and driven by recent acquisition.
Speaker #2: Finally, other current expenses came in at €2.4 million, preliminarily driven by bad debt provisions. Customer credit risk remains well controlled at just 0.6% of revenue—a testament to our robust internal processes and disciplined approach, even in today's challenging macroeconomic environment.
Speaker #2: Below EBITDA, our depreciation and amortization increased plus 9.3% at 97.8 million euros, aligned with the fleet increase and driven by recent acquisition. Our financial results increased by 6.5 million euros to 43 million euros compared to the 36.5 million euros last year, restricted from the impact of aging instrument mark-to-market variations and increase of roughly 5 million euros compared to last year and many explained by the refinancing occurred in April.
Antoine Clech: Our financial results increased by EUR 6.5 million to EUR 43 million compared to the EUR 36.5 million last year. We benefited from the impact of hedging instrument mark-to-market valuations, an increase of roughly EUR 5 million compared to last year, and mainly explained by the refinancing procure in April. In page 25, despite the challenging market conditions, we managed a gross organic revenue trajectory fueled by acquisition and succeeded to maintain a high profitability level at 39.5%. Oh, sorry, 39.5%, increasing by +0.7 points. Moving on to our cash flow performance on page 24. In Q2 2026, our free cash flow stood at +EUR 26.3 million, increasing by EUR 50.6 million compared to last year, mainly related to fading of the net working capital, as well as our CapEx reduction policy, as already mentioned by Olivier Colleau.
Antoine Clech: Our financial results increased by EUR 6.5 million to EUR 43 million compared to the EUR 36.5 million last year. We benefited from the impact of hedging instrument mark-to-market valuations, an increase of roughly EUR 5 million compared to last year, and mainly explained by the refinancing procure in April. In page 25, despite the challenging market conditions, we managed a gross organic revenue trajectory fueled by acquisition and succeeded to maintain a high profitability level at 39.5%. Oh, sorry, 39.5%, increasing by +0.7 points. Moving on to our cash flow performance on page 24. In Q2 2026, our free cash flow stood at +EUR 26.3 million, increasing by EUR 50.6 million compared to last year, mainly related to fading of the net working capital, as well as our CapEx reduction policy, as already mentioned by Olivier Colleau.
Speaker #2: On page 25, despite the challenging market conditions, we managed a growth in organic revenue trajectory, fueled by acquisition, and succeeded in maintaining a high profitability level at 39.5%, increasing by plus 0.7 points.
Speaker #2: Moving on to our cash flow performance on page 24, in Q2 2026 our free cash flows stood at €26.3 million, increasing by €50.6 million compared to last year. This was mainly related to the phasing of networking capital, as well as our capex reduction policy, as already mentioned by Olivier.
Speaker #2: In Q2 2026, our net debt preferred 16 decreased by €27.3 million. During the first six months of the year, our net debt increased by €115.5 million, explained by our recent acquisition, while we generated a positive free cash flow of €31.3 million.
Antoine Clech: In Q2 2026, our net debt per IFRS 16 decreased by EUR 27.3 million. During the first six months of the year, our net debt increased by EUR 115.5 million, explained by our recent acquisition, while we generated a positive free cash flow of EUR 31.3 million. In summary, page 26, at the end of the second quarter of 2026, we delivered a robust recurring free cash flow of EUR 53.9 million, representing an increase of EUR 34.7 million compared to last year. This is underpinned by our continued operational agility and strict investment oversight, which drove a 24% reduction in fleet CapEx. Let's turn our attention to the leverage ratio. You will see that our net debt leverage stood at a healthy 3.89, and remains stable compared to Q4 2025.
Antoine Clech: In Q2 2026, our net debt per IFRS 16 decreased by EUR 27.3 million. During the first six months of the year, our net debt increased by EUR 115.5 million, explained by our recent acquisition, while we generated a positive free cash flow of EUR 31.3 million. In summary, page 26, at the end of the second quarter of 2026, we delivered a robust recurring free cash flow of EUR 53.9 million, representing an increase of EUR 34.7 million compared to last year. This is underpinned by our continued operational agility and strict investment oversight, which drove a 24% reduction in fleet CapEx. Let's turn our attention to the leverage ratio. You will see that our net debt leverage stood at a healthy 3.89x, and remains stable compared to Q4 2025.
Speaker #2: In summary, on page 26, at the end of the second quarter of 2026, we delivered a robust recurring free cash flow of €53.9 million, representing an increase of €34.7 million compared to last year.
Speaker #2: This is underpinned by our continued operational agility and strict investment oversight, which drove a 24% reduction in fleet capex. Let's turn our attention to the leverage ratio.
Speaker #2: You will see that our net debt leverage stood at a healthy 3.89 and remained stable compared to Q4 2025. Following the increase due to the 2022 transformation acquisition, our net debt leverage stands below 4, keeping us below 4 for the 13th consecutive quarter.
Speaker #2: On page 27, you will notice that we maintained a strong liquidity position throughout the quarter, ending at €61.7 million, even after fully reimbursing our RCF during Q2.
Antoine Clech: Following the increase due to the 2022 transforming acquisition, our net debt leverage stands below 4, keeping us below 4 for the 13th consecutive quarter. On page 27, you will notice that we maintain a strong liquidity position throughout the quarter, ending at EUR 61.7 million, even after fully reimbursing our RCF during Q2. To conclude this segment, page 28 provides a detailed breakdown of our gross debt by maturity at the end of June 2026. Our debt profile is composed as follows: the EUR 450 million floating rate note maturing in 2033, representing 21% of our gross debt. The EUR 950 million senior secured fixed rate note maturing in 2031 and 2032 account for 44% of our gross debt. As explained earlier, this note has been refinanced in April to increase the maturity of debt structure.
Antoine Clech: Following the increase due to the 2022 transforming acquisition, our net debt leverage stands below 4x, keeping us below 4 for the 13th consecutive quarter. On page 27, you will notice that we maintain a strong liquidity position throughout the quarter, ending at EUR 61.7 million, even after fully reimbursing our RCF during Q2. To conclude this segment, page 28 provides a detailed breakdown of our gross debt by maturity at the end of June 2026. Our debt profile is composed as follows: the EUR 450 million floating rate note maturing in 2033, representing 21% of our gross debt. The EUR 950 million senior secured fixed rate note maturing in 2031 and 2032 account for 44% of our gross debt. As explained earlier, this note has been refinanced in April to increase the maturity of debt structure.
Speaker #2: To conclude this segment, page 28 provides a detailed breakdown of our gross debt by maturity at the end of June 2026. Our debt profile is composed as follows: the €450 million floating rate note maturing in '33, representing 21% of our gross debt.
Speaker #2: The €950 million senior secured fixed rate note, maturing in 2031 and 2032, accounts for 44% of our gross debt, as explained earlier. This note was refinanced in April to increase the maturity of our debt structure.
Speaker #2: Stimulus bond maturing on December 31 for €5 million, and financial lease amounting to €483.9 million. 70.4% of our gross debt, excluding operating lease liabilities under FRS 16, has a maturity of five years.
Antoine Clech: A Schuldschein bond maturing in December 2031 for EUR 5 million, and financial lease amounting to EUR 483.9 million. 74% of our gross net, excluding operating lease liabilities under IFRS 16, has a maturity of five years. To summarize, the second quarter of 2026 confirms the resilience of our model, with our top-line growth fully supported by our recent acquisition in a market characterized by volume pressure in certain geographies. Thanks to our tight operational discipline, we maintained a broadly stable organic performance while expanding our EBITDA margins this quarter. Backed by recurring free cash flow generation and a well-controlled leverage ratio, our financial structure remains healthy and supportive of our strategic goals. Now, I will hand it back to Olivier, who will provide further insights into our roadmap for the upcoming months.
Antoine Clech: A Schuldschein bond maturing in December 2031 for EUR 5 million, and financial lease amounting to EUR 483.9 million. 74% of our gross net, excluding operating lease liabilities under IFRS 16, has a maturity of five years. To summarize, the second quarter of 2026 confirms the resilience of our model, with our top-line growth fully supported by our recent acquisition in a market characterized by volume pressure in certain geographies. Thanks to our tight operational discipline, we maintained a broadly stable organic performance while expanding our EBITDA margins this quarter. Backed by recurring free cash flow generation and a well-controlled leverage ratio, our financial structure remains healthy and supportive of our strategic goals. Now, I will hand it back to Olivier, who will provide further insights into our roadmap for the upcoming months.
Speaker #2: To summarize, the second quarter of 2026 confirms the resilience of our model, with our top-line gross fully supported by our recent acquisition in a market characterized by volume pressure in certain geographies.
Speaker #2: Thanks to our tight operational discipline, we maintained a broadly stable organic performance while expanding our EBITDA margins this quarter. Backed by recurring free cash flow generation and a well-controlled leverage ratio, our financial structure remained healthy and supportive of our strategic goals.
Speaker #2: Now, I'll hand it back to Olivier, who will provide further insight into the roadmap for the upcoming months.
Speaker #1: Thank you, Antoine. And let's indeed discuss the next few months and let me give you our views on the economic outlook. Market conditions remain demanding, notably across France and Germany.
Olivier Colleau: Thank you. Thank you, Antoine. Let us indeed discuss about the next few months, and let me give you our views on the economic outlook. Market conditions remain demanding, notably across France and Germany, while Southern Europe continues to benefit from LCO market momentum. In this context, prudence stance is required. We expect to continue reducing our fleet CapEx throughout 2026, while enhancing operational efficiency, which will include further optimization of our branch footprint. That said, this disciplined approach won't hold us back from capturing targeted growth opportunities, particularly in high potential areas like specialties and Southern Europe. Finally, I would like to highlight the key achievements we are quite proud of, which is the award we received for the second year in a row, of EcoVadis Platinum. This is the highest possible award at EcoVadis.
Olivier Colleau: Thank you. Thank you, Antoine. Let us indeed discuss about the next few months, and let me give you our views on the economic outlook. Market conditions remain demanding, notably across France and Germany, while Southern Europe continues to benefit from LCO market momentum. In this context, prudence stance is required. We expect to continue reducing our fleet CapEx throughout 2026, while enhancing operational efficiency, which will include further optimization of our branch footprint. That said, this disciplined approach won't hold us back from capturing targeted growth opportunities, particularly in high potential areas like specialties and Southern Europe. Finally, I would like to highlight the key achievements we are quite proud of, which is the award we received for the second year in a row, of EcoVadis Platinum. This is the highest possible award at EcoVadis.
Speaker #1: While Southern Europe continues to benefit from healthier market momentum, a prudent stance is required. In this context, we expect to continue reducing our fleet capex throughout 2026.
Speaker #1: While enhancing operational efficiency, which will include further optimization of our brand footprint, that said, this disciplined approach won't hold us back from capturing targeted growth opportunities, particularly in high-potential areas like specialties and Southern Europe.
Speaker #1: And finally, I would like to highlight the key achievements we are quite proud of, which is the award we received for the second year in a row: Ecovadis Platinum. This is the highest possible award from Ecovadis, which we received last month, and this confirms our long-term ambition for sustainability despite short-term headwinds.
Speaker #1: So this is it for the presentation. As I said at the beginning, we clearly have time to take all the questions you might have, so please, operator, let's go for this Q&A session.
Olivier Colleau: We received it last month, and this is confirming our long-term ambition for sustainability despite short-term headwinds. This is it for this presentation. As I said at the beginning, we clearly have time to take all the questions you might have. Please, operator, let us go for this Q&A session.
Olivier Colleau: We received it last month, and this is confirming our long-term ambition for sustainability despite short-term headwinds. This is it for this presentation. As I said at the beginning, we clearly have time to take all the questions you might have. Please, operator, let us go for this Q&A session.
Speaker #3: If you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #key5 on your telephone keypad to enter the queue.
Operator 2: If you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from James Cawthorn from Barclays. Please go ahead.
Operator: If you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from James Cawthorpe from Barclays. Please go ahead.
Speaker #3: If you wish to withdraw your question, please dial #key6 on your telephone keypad. The next question comes from James Cothorp from Barclays. Please go ahead.
Speaker #4: Hi there. Thank you for my question. I'll take my question. I just wanted to ask a couple of questions. Firstly, on the outlook, I realize you sort of mentioning continued subdued conditions within France.
Speaker #4: I mean, are you seeing anything in terms of green shoots coming through, or are you expecting those to materialize as we progress through the remainder of 2026?
James Cawthorn: Hi there. Thank you for taking my question. I just wanted to ask a couple of questions. Firstly, on the outlook. I realize you are sort of mentioning continued subdued conditions within France. Are you seeing anything in terms of green shoots coming through or are you expecting to materialize as we progress through the remainder of 2026? What do you expect that you need to see to start seeing some more meaningful signs of an inflection? Then just on terms of broader appetite for M&A and the types of acquisitions that you would look at, are you able to expand in terms of what degree of specialties or high growth type markets or particular types of fleet that you would be looking at in order to expand? Thank you.
James Cawthorpe: Hi there. Thank you for taking my question. I just wanted to ask a couple of questions. Firstly, on the outlook. I realize you are sort of mentioning continued subdued conditions within France. Are you seeing anything in terms of green shoots coming through or are you expecting to materialize as we progress through the remainder of 2026? What do you expect that you need to see to start seeing some more meaningful signs of an inflection? Then just on terms of broader appetite for M&A and the types of acquisitions that you would look at, are you able to expand in terms of what degree of specialties or high growth type markets or particular types of fleet that you would be looking at in order to expand? Thank you.
Speaker #4: And what do you expect that you need to see to start seeing some more meaningful signs of an inflection? And then just on terms of broader appetite for M&A and the types of acquisitions that you would look at, are you able to expand in terms of what degree of specialties or high-growth type markets or particular types of fleet that you'd be looking at in order to expand?
Speaker #4: Thank you.
Speaker #5: Yeah, thank you. So I will take these two questions. The first one relates to the outlook in France. It's clear that we are navigating in France in quite uncertain areas.
Olivier Colleau: Yeah, thank you. I will take these two questions. The first one related to the outlook in France, it is clear that we navigate in France in quite uncertain areas. Well, you all know the situation of the general economy, which is quite not in a good shape in 2026. As far as construction is concerned, we are clearly in the low phase of the cycle. Do we see positive signs? Well, it is not obvious. That is, when we discuss with our customers that they are discussing about new projects to start, but it is not a big boom. You were asking about what we need to have. It is clearly we need to have more confidence. That is, like always with confidence, it might change. That is, it might recover much quicker than what I think.
Olivier Colleau: Yeah, thank you. I will take these two questions. The first one related to the outlook in France, it is clear that we navigate in France in quite uncertain areas. Well, you all know the situation of the general economy, which is quite not in a good shape in 2026. As far as construction is concerned, we are clearly in the low phase of the cycle. Do we see positive signs? Well, it is not obvious. That is, when we discuss with our customers that they are discussing about new projects to start, but it is not a big boom. You were asking about what we need to have. It is clearly we need to have more confidence. That is, like always with confidence, it might change. That is, it might recover much quicker than what I think.
Speaker #5: If I look—well, you all know the situation of the general economy, which is quite not in a good shape in 2026. As far as construction is concerned, we are clearly in the low phase of the cycle.
Speaker #5: Do we see positive signs? Well, it's not obvious. When we discuss with our customers, they are talking about new projects to start, but it's not a big boom. And you were asking about what we need to have.
Speaker #5: It's clearly we need to have more confidence. So that is like always with confidence. It might change. So that is it might be it might recover much quicker than what I think, but as we speak, this is why we are quite on the cautious line, related to the French business with yeah, with a soft market condition in 2026 and probably also continuing at least for the first part of 2027.
Olivier Colleau: But as we speak, this is why we are quite on the cautious line related to the French business with the soft market condition in 2026 and probably also continuing at least for the first part of 2027. As far as M&A is concerned, we are still looking at opportunities. This is what we did in the beginning of the year with a number of operations in Spain, in Italy, and also in Ireland. That is, we are looking at areas where we consider that it will bring value to group, either because we reinforce our position in a strong market. This is why we reinforce our position in Spain or Italy, or if we consider that there are new markets where we could bring something, which was the case with Ireland. You were asking specifically the question on specialties.
Olivier Colleau: But as we speak, this is why we are quite on the cautious line related to the French business with the soft market condition in 2026 and probably also continuing at least for the first part of 2027. As far as M&A is concerned, we are still looking at opportunities. This is what we did in the beginning of the year with a number of operations in Spain, in Italy, and also in Ireland. That is, we are looking at areas where we consider that it will bring value to group, either because we reinforce our position in a strong market. This is why we reinforce our position in Spain or Italy, or if we consider that there are new markets where we could bring something, which was the case with Ireland. You were asking specifically the question on specialties.
Speaker #5: As far as M&A is concerned, we are still looking at opportunities, and this is what we did at the beginning of the year with a number of operations in Spain, in Italy, and also in Ireland.
Speaker #5: So that is, we are looking at areas where we consider that it will bring value to the group, either because we reinforce our position in a strong market.
Speaker #5: So, this is why we reinforced our position in Spain or Italy, or if we consider that there are new markets where we could bring something, which was the case with Ireland.
Speaker #5: You were asking specifically the question on specialties. So, specialties are more and more important at Q2. We have specialties in France, but also in Denmark, in Spain, and Portugal.
Speaker #5: So, we are looking at these specialties. HVAC is meaningful, as is power. As we speak, we don't have any well-advanced discussions on specialties, but it is part of the M&A strategy we have.
Olivier Colleau: Specialties are more and more important at Kiloutou. We have specialties in France, but also in Denmark, in Spain, and Portugal. We are looking at these specialties. HVAC is meaningful, so is power. As we speak, we don't have any well-advanced discussion on specialties, but it is part of the M&A strategy we have.
Olivier Colleau: Specialties are more and more important at Kiloutou. We have specialties in France, but also in Denmark, in Spain, and Portugal. We are looking at these specialties. HVAC is meaningful, so is power. As we speak, we don't have any well-advanced discussion on specialties, but it is part of the M&A strategy we have.
Speaker #4: Thank you.
Speaker #3: As a reminder, if you wish to ask a question, you may do so in one of two ways: Click the green hand icon on the player to ask your question orally, or join the conference call and dial #key5 on your telephone keypad to enter the queue.
James Cawthorn: Thank you.
James Cawthorpe: Thank you.
Operator 2: As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Toby Hunston from Permira. Please go ahead.
Operator: As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Toby Hunston from Permira. Please go ahead.
Speaker #3: If you wish to withdraw your question, please dial #key6 on your telephone keypad. The next question comes from Toby Hunston from Purmera. Please go ahead.
Speaker #4: All right then, thanks very much. Yeah, I just wanted to ask a little bit more about the French trend you're seeing and, specifically, which sub-segments of the French market are kind of weaker and stronger.
Toby Hunston: Hi there. Thanks very much. I just wanted to ask a little bit more about the French trenches seeing and the sort of which subsegments of the French market are kind of weaker and stronger?
Toby Hunston: Hi there. Thanks very much. I just wanted to ask a little bit more about the French trenches seeing and the sort of which subsegments of the French market are kind of weaker and stronger?
Speaker #5: Toby, can I ask you to speak a bit louder, please?
Speaker #4: Yeah, sorry. My question was just on the French market, and specifically which sub-segments of that market you see as being stronger or more subdued, and which kind of components are driving the overall trend there.
Olivier Colleau: Toby, can I ask you to speak a bit louder, please?
Olivier Colleau: Toby, can I ask you to speak a bit louder, please?
Toby Hunston: My question was just on the French market, and specifically which subsegments of that market you see as being stronger or more subdued, and which kind of components are driving the overall trend there. My second question was just on the margin performance in the international business. I think margins were down a little bit in Q2, so just some color on what is going on there would be helpful. Thanks.
Toby Hunston: My question was just on the French market, and specifically which subsegments of that market you see as being stronger or more subdued, and which kind of components are driving the overall trend there. My second question was just on the margin performance in the international business. I think margins were down a little bit in Q2, so just some color on what is going on there would be helpful. Thanks.
Speaker #4: And then my second question was just on the margin performance in the international business, because I think margins were down a little bit in Q2. So just any color on what's going on there would be helpful.
Speaker #4: Thanks.
Speaker #5: Okay, so I will take the first one on the French market, and Antoine, I will leave you the question from Toby on margin in the international segment.
Speaker #5: On the French market, there are indeed, as you suggest, differences in the dynamics of sub-segments. That is, on one side, the construction business is clearly quite soft, and this is a fact for civil works.
Olivier Colleau: Okay. I will take the first one on the French market, and Antoine, I will leave you the question of Toby on margin on the international segment. On the French market, there are indeed, as you suggest, differences in dynamics of subsegments. That is, on one side, the construction business is clearly quite soft, and this is a fight for civil works. Also new build. Renovation is doing quite better, but let's say it is a flat or flat plus. Non-construction is doing better, so it is clear that industry is doing good with good prospects. We have, like in other countries in Europe, a project for data centers. This in total, this non-construction business is accounting for roughly 40% of our business in France. There are opportunities in industry and energy, opportunities to grow.
Olivier Colleau: Okay. I will take the first one on the French market, and Antoine, I will leave you the question of Toby on margin on the international segment. On the French market, there are indeed, as you suggest, differences in dynamics of subsegments. That is, on one side, the construction business is clearly quite soft, and this is a fight for civil works. Also new build. Renovation is doing quite better, but let's say it is a flat or flat plus. Non-construction is doing better, so it is clear that industry is doing good with good prospects. We have, like in other countries in Europe, a project for data centers. This in total, this non-construction business is accounting for roughly 40% of our business in France. There are opportunities in industry and energy, opportunities to grow.
Speaker #5: Also, new build renovation is doing quite better, but let's say it's a flat or a flat, then non-construction is doing better. So it's clear that industry is doing good with good prospects.
Speaker #5: We have, like in other countries in Europe, projects for data centers. So this non-construction business is continuing to account for roughly 40% of our business in France.
Speaker #5: So, there are opportunities in industry and energy, opportunities to grow. Yes. And yes, regarding your question on the international margin: yes, first of all, what you can see is that our margin internationally is increasing, including the acquisition. But effectively, on a constant perimeter, you can see a slight contraction of the margin.
Antoine Clech: Yes. Regarding your question on international margin. First of all, what we can see is that our margin international increasing, including the acquisition, but effectively in the constant perimeter, you can see a slight contraction of the margin while maintaining a high baseline profitability. This quarter was temporarily affected by isolated and non-recurring item. At this stage, we do not expect this level of contraction to persist at these levels through year end.
Antoine Clech: Yes. Regarding your question on international margin. First of all, what we can see is that our margin international increasing, including the acquisition, but effectively in the constant perimeter, you can see a slight contraction of the margin while maintaining a high baseline profitability. This quarter was temporarily affected by isolated and non-recurring item. At this stage, we do not expect this level of contraction to persist at these levels through year end.
Speaker #5: While maintaining a high base line profitability, yes, this quarter was temporarily affected by isolated and non-recurring item and at this stage, we do not expect this level of contraction to persist at this level through year end.
Speaker #4: Okay, thank you. And then just on CAPEX—it was down about 20 to 25% in Q2. Are you thinking that it will be similar throughout the second half, or is most of the CAPEX reduction already done in the first half?
Toby Hunston: Okay, thank you. On CapEx, was down about 20% to 25% in Q2. Are you thinking that it would be similar through H2, or is most of the CapEx reduction done already in H1?
Toby Hunston: Okay, thank you. On CapEx, was down about 20% to 25% in Q2. Are you thinking that it would be similar through H2, or is most of the CapEx reduction done already in H1?
Speaker #5: Yeah, I will take it. So, we did decrease the CAPEX by 20–24% in the first half of the year. We remain on the guideline that we shared with you previously, which is roughly minus 20% over the entire 2026.
Olivier Colleau: Yeah, I will take it. We indeed decreased the CapEx by 20% to 24% in H1. We remain on the guideline that we shared with you previously, which is roughly -20% over the entire 2026. Which would be -15% if we include the fact that the perimeter has changed. That is, in comparison with last year, we have new companies we acquired, and we are making CapEx for them. It will be -15% if we include the new acquired companies. This means that the -24% in H1 is due to phasing. That is, there were more fleet received in the beginning of the year, last year, and so we cut more in the beginning of the year. Let's remain on the guideline that we previously shared with you.
Olivier Colleau: Yeah, I will take it. We indeed decreased the CapEx by 20% to 24% in H1. We remain on the guideline that we shared with you previously, which is roughly -20% over the entire 2026. Which would be -15% if we include the fact that the perimeter has changed. That is, in comparison with last year, we have new companies we acquired, and we are making CapEx for them. It will be -15% if we include the new acquired companies. This means that the -24% in H1 is due to phasing. That is, there were more fleet received in the beginning of the year, last year, and so we cut more in the beginning of the year. Let's remain on the guideline that we previously shared with you.
Speaker #5: And which would be minus 15% if we include the fact that the perimeter has changed. So that is we have new in comparison with last year, we have new companies we acquired and we are making CAPEX for them.
Speaker #5: So, it will be minus 15% if we include the newly acquired companies. So, this means that the minus 24% in the first half is due to phasing.
Speaker #5: So that is, we had more fleet received in the beginning of the year and last year, and so we cut more in the beginning of the year.
Speaker #5: But let's stick to the guideline that we previously shared with you.
Speaker #4: Okay, thank you.
Speaker #3: The next question comes from Shubham Agrawal from BlackRock. Please go ahead.
Speaker #2: Oh, hey. Hi. Can you hear me well?
Speaker #5: Yes, we can.
Toby Hunston: Okay, thank you.
Toby Hunston: Okay, thank you.
Speaker #2: Yeah. So my question is, let's say if the growth, the expected growth, gets delayed even into 2027, how long can you continue to cut CAPEX before you need—before it would be needed to maintain the fleet at current levels, please?
Operator 2: The next question comes from Shubham Agrawal from BlackRock. Please go ahead.
Operator: The next question comes from Shubham Agrawal from BlackRock. Please go ahead.
Shubham Agrawal: Hey. Hi, can you hear me well?
Shubham Agrawal: Hey. Hi, can you hear me well?
Olivier Colleau: Yes, we can.
Olivier Colleau: Yes, we can.
Shubham Agrawal: My question is, let's say if the expected growth gets delayed even in 2027, how long can you continue to cut CapEx before it would be needed to maintain the fleet at current levels, please?
Shubham Agrawal: My question is, let's say if the expected growth gets delayed even in 2027, how long can you continue to cut CapEx before it would be needed to maintain the fleet at current levels, please?
Speaker #5: Yeah, and that's a fair question. Thanks for this one. We are reducing CAPEX, but we are still renewing the fleet. If we look at the average age of the fleet, it's still around five years, which is more or less half of the life of the fleet at Q2.
Olivier Colleau: That's a fair question. Thanks for this one. We are reducing CapEx. We are still renewing the fleet. That is, if we look at the average age of the fleet, it's still around five years, which is more or less half of the life of the fleet at Kiloutou. We are not making the fleet becoming older. From that point of view, it's quite safe. We should not expect to have any deterioration of the fleet or any CapEx to catch up later on. That is, we will adapt. If next year, as I said, the French market remain flat, we will do the renewal CapEx. That is, the fleet will not get older, but we will have a known or very limited growth CapEx in France. Other countries, as I said, are more oriented.
Olivier Colleau: That's a fair question. Thanks for this one. We are reducing CapEx. We are still renewing the fleet. That is, if we look at the average age of the fleet, it's still around five years, which is more or less half of the life of the fleet at Kiloutou. We are not making the fleet becoming older. From that point of view, it's quite safe. We should not expect to have any deterioration of the fleet or any CapEx to catch up later on. That is, we will adapt. If next year, as I said, the French market remain flat, we will do the renewal CapEx. That is, the fleet will not get older, but we will have a known or very limited growth CapEx in France. Other countries, as I said, are more oriented.
Speaker #5: So we are not making the fleet become older. So from that point of view, it's quite safe, so we should not expect to have any deterioration of the fleet or any CAPEX or catch-up later on.
Speaker #5: So, that is—if we adapt next year, as I said, if the French market remains flat, we will do the renewal CAPEX.
Speaker #5: So that is, the fleet will not get older, but we will have no, or very limited, growth CAPEX. In France—then, other countries, as I said, are more oriented.
Speaker #5: And if you look now, with the recent acquisition of KDM in Ireland, our business in terms of revenue is 55% in France and 45% outside of France.
Speaker #5: So, this means that, by the way, it confirms our strategy to diversify our sources of revenue. And it means that if the other countries confirm having positive momentum, we will continue putting CAPEX and going outside of France.
Olivier Colleau: And if you look now with the recent acquisition of KDM in Ireland, our business in terms of revenue is 55% in France, 45% outside of France. This means that it confirms our strategy to diversify our sources of revenues. It means that if the other countries confirm having a positive momentum, we will continue putting CapEx and growing outside of France.
Olivier Colleau: And if you look now with the recent acquisition of KDM in Ireland, our business in terms of revenue is 55% in France, 45% outside of France. This means that it confirms our strategy to diversify our sources of revenues. It means that if the other countries confirm having a positive momentum, we will continue putting CapEx and growing outside of France.
Speaker #2: Got it. Yeah, that's very helpful. Next question is around acquisition itself. Apologies if this was already discussed earlier. Can you comment on rent which is up for disposal?
Speaker #2: So, is it something which will be complementary for the Kiloutou business, or anything you can comment on that, please?
Shubham Agrawal: Got it. Yeah, that's really helpful. Next question is around acquisition itself. Apologies if it was already discussed somewhere earlier. Can you comment something around Renta Group, which is being up for disposal? Is it something which will be complementary for the Kiloutou business or anything you can comment on that, please?
Shubham Agrawal: Got it. Yeah, that's really helpful. Next question is around acquisition itself. Apologies if it was already discussed somewhere earlier. Can you comment something around Renta Group, which is being up for disposal? Is it something which will be complementary for the Kiloutou business or anything you can comment on that, please?
Speaker #5: Yeah, it's—well, it's clear that you say it's complementary. Yes, if we look at the footprint, the countries, it's a fact that Kiloutou and Rental have complementary footprints.
Speaker #5: They are pretty strong in the Nordics. There are small overlaps in Poland and Denmark, and then they are not in Western or Southern Europe—and we are.
Olivier Colleau: Well, it's clear that you say it's complementary. Yes, if we look at the footprint of the countries, it's a fact that Kiloutou and Renta Group have complementary footprints. They are pretty strong in the Nordics. There are small overlaps in Poland and Denmark, and then they are not in Western/Southern Europe, and we are. So we are complementary. So we are following what could happen with Renta Group. Then, to be honest, it raises also a number of questions, including the size of the business, which is quite large. So nothing really decided on that front. We are more observing what could happen rather than being very active on that opportunity.
Olivier Colleau: Well, it's clear that you say it's complementary. Yes, if we look at the footprint of the countries, it's a fact that Kiloutou and Renta Group have complementary footprints. They are pretty strong in the Nordics. There are small overlaps in Poland and Denmark, and then they are not in Western/Southern Europe, and we are. So we are complementary. So we are following what could happen with Renta Group. Then, to be honest, it raises also a number of questions, including the size of the business, which is quite large. So nothing really decided on that front. We are more observing what could happen rather than being very active on that opportunity.
Speaker #5: So, we are complementary. So, we are following what could happen with rental. Then, to be honest, it raises also a number of questions, including the size of the business, which is quite large.
Speaker #5: So, nothing is really decided on that front. We are more observing what could happen rather than being very active on that opportunity.
Speaker #2: Got it. That's really helpful. Thank you.
Speaker #3: As a reminder, if you wish to ask a question, you may do so in one of two ways: click the green hand icon on the player to ask your question orally, or join the conference call and dial pound key five on your telephone keypad to enter the queue.
Shubham Agrawal: Got it. That's really helpful. Thank you.
Shubham Agrawal: Got it. That's really helpful. Thank you.
Speaker #3: If you wish to withdraw your question, please dial pound key six on your telephone keypad. As a reminder, if you wish to ask a question, you may do so in one of two ways.
Operator 2: As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. There are no more questions at this time. I hand the conference back to the speakers for any closing comments.
Operator: As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. As a reminder, if you wish to ask a question, you may do so in one of two ways. Click the green hand icon on the player to ask your question orally, or join the conference call and dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. There are no more questions at this time. I hand the conference back to the speakers for any closing comments.
Speaker #3: Click the green hand icon on the player to ask your question orally, or join the conference call and dial the pound key, then five, on your telephone keypad to enter the queue.
Speaker #3: If you wish to withdraw your question, please dial pound key six on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.
Speaker #5: Yeah, thank you, Laura. Sorry, I take it from the fact that we don't have any more questions that our presentation was clear enough and the answers to the questions were good enough.
Speaker #5: Thank you all for your attendance on this conference call. Thank you for your time. Let's say we will be discussing again in a couple of months for the third quarter results.
Olivier Colleau: Yes, thank you, Laura. I take away from the fact that we don't have any more questions, that our presentation was clear enough, and the answers to the questions were good enough. Thank you all for your attendance to this conference call. Thanks for your time, and let's say we will be discussing in a couple of months for the Q3 results. Have a good day and stay safe. Bye-bye.
Olivier Colleau: Yes, thank you, Laura. I take away from the fact that we don't have any more questions, that our presentation was clear enough, and the answers to the questions were good enough. Thank you all for your attendance to this conference call. Thanks for your time, and let's say we will be discussing in a couple of months for the Q3 results. Have a good day and stay safe. Bye-bye.
Speaker #5: Have a good day and stay safe. Bye-bye.
Operator 1: The host has ended this call. Goodbye.