Operator: Welcome to the Edenred Q3 2026 revenue conference call. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing #5 on their telephone keypad. Now I will hand the conference over to the speaker, Virginie Duperat-Vergne, CFO. Please go ahead.
Virginie Duperat-Vergne: Thank you. Ladies and gentlemen, good morning, and thank you for joining the Q3 2026 revenue presentation of Edenred. I am Virginie Duperat-Vergne, Group CFO, and I am today with Cédric Appert, Investor Relations Director. We are together here for the next hour, starting with a presentation of about 30 minutes, and then we will have a Q&A session. Starting maybe with slide 9, which shows both of our operating revenue like-for-like growth and our operating revenue intrinsic growth. As a reminder, intrinsic growth reflects Edenred growth, excluding the 2026 resets resulting from the meal and food regulatory changes in Italy and Brazil, countries which together account for around 20% of our operating revenue. In Q3 2026, intrinsic growth reached 6.6%, bringing year-to-date intrinsic growth to a solid +7.6%.
Virginie Duperat-Vergne: This performance notably reflects continued double-digit like-for-like growth in Mobility, partly offset by the full impact of the new meal and food regulation in Brazil in Q3, and the final effects of the regulatory change in Italy. Overall, this performance demonstrates that Edenred's underlying growth trends remain solid and dynamic. Moving now to slide 10. You can see the breakdown of our 9 months operating revenue by business line. On a like-for-like basis, operating revenue grew +4.6% year to date, which translates into a strong +7.6% intrinsic growth year to date, once we override the regulatory reset. Looking at the business lines individually provides a good illustration of this underlying momentum. Mobility, which represents 28% of our 9 months operating revenue, continues to deliver double-digit growth.
Virginie Duperat-Vergne: Beyond Fuel Solutions posted strong revenue growth over Q3, notably toll and maintenance in Brazil and VAT recovery services and EV charging in Europe. Benefits & Engagement posted +6.9% intrinsic growth, reflecting good sales in Latin America and in Southern Europe. Beyond Food Solutions delivered a steady growth, notably in Latin America. Payment Solutions and New Markets grew +2.3%. Taiwan's digital gift voucher business growth was almost offset by the continued impact of the Middle East conflict on our UAE business and the tail effect of the banking-as-a-service B2C exit. Overall, the breakdown confirms the solid underlying growth dynamics across our businesses. Now, moving to slide 11. You can see the breakdown of our 9 months operating revenue by geography. Looking across geographies, we continue to see strong and broad-based underlying growth.
Virginie Duperat-Vergne: Latin America delivered double-digit intrinsic growth with good sales in Mexico and in Brazil. Rest of the world also at close to double-digit levels, driven by Japan, Taiwan, and Turkey, but hampered by UAE slowdown due to the Middle East conflict. Europe posted a sustained intrinsic growth of +5%, despite a high basis of comparison in Italy due to the one-off effect of extra orders in July and August 2025 before the change in regulation. Now, let me turn to slide 13 to illustrate the first pillar of our Amplify strategy, Attract, which is more users. We have entered into a partnership with Silae. This is the number 1 HRIS player in Europe, which has a particularly strong footprint in France, with close to 1 million SME clients and a monthly volume of 8 million paychecks issued.
Virginie Duperat-Vergne: As part of this partnership, Edenred+, our new cutting-edge platform, which is API native and cloud native, will be directly integrated into Silae's offering in France, providing its client with access to our multi-benefit platform through a seamless onboarding experience and a fully integrated technology setup. What does it mean for Edenred? First, it represents a direct access to around 25% of all French SMEs. Second, we are leveraging a network of more than 6,000 chartered accountants to distribute Edenred solutions. Thus, this partnership should further strengthen our SME acquisition engine and help capture additional growth opportunities in an attractive and still largely untapped SME market. It illustrates Edenred's ability to be distributed by indirect partners. Moving to slide 14. We continue with an illustration of the second growth pillar of our Amplify plan, Enrich, which is more value per user.
Virginie Duperat-Vergne: In Mexico, our relationship with Grupo Bimbo, which is the largest baking company in the world, was initially focused on fuel services. In 2026, we have significantly expanded that relationship, adding EV charging and all meal solutions for mobility. In addition, we have been able to create traction for the Benefits & Engagement business line, and we are now serving 80,000 Bimbo's employees for meal and food solutions. This demonstrates our ability to leverage an existing client relationship to cross-sell within and across business lines and increase value per user. Concretely speaking, it represents a +20% increase in average revenue per user on the mobility side and around EUR 100 million of meal and food business volume on a yearly basis. This shows exactly how the breadth of Edenred's portfolio can translate into additional organic growth stemming from our existing client base. Now, continuing on slide 15.
Virginie Duperat-Vergne: We wanted to show you another illustration of our Enrich pillar, but also a view on the positive regulatory evolution that Edenred is able to see. In Japan, after 42 years without any change, the meal voucher's face value increased by more 100% in April 2026. We moved quickly to capture the opportunity with targeted marketing campaigns, and the results are already very strong. Our total number of clients is up by more than 40% year to date, and operating revenue is growing more than 50% like-for-like. Right now, Japan is our fastest growing meal and food country, and we are reinforcing our number one position with more than 300,000 users. In a nutshell, favorable regulatory developments such as increases in face value accelerate client acquisition and organic growth for Edenred in Japan. Moving now to slide 17 and the Q3 performance.
Virginie Duperat-Vergne: Total revenue amounted to EUR 725 million, reflecting a -1.3% like-for-like growth. The foreign exchange impact on our Q3 operating revenue was a positive, +2.1%, combined with a scope effect of -0.9%, related to the disposals we achieved over the quarter, and notably the deconsolidation of Edenred Pay North America. I will comment on other revenue later in the presentation. Overall, this resulted in a flat reported growth rate for the Q3 of 2026, and this confirms that Edenred continues to deliver sustained intrinsic growth while absorbing meaningful regulatory impacts in Italy and in Brazil. Moving now to slide 18. The diversity of our solution portfolio remains a key strength of Edenred's business model. In the Mobility business line, accounting for 30% of Edenred business in Q3, operating revenue came at EUR 202 million in Q3 2026, up +10.7% like-for-like versus Q3 2025.
Virginie Duperat-Vergne: This continued double-digit performance quarter after quarter confirms the relevance of Edenred's Mobility offering. Growth was driven by strong commercial momentum, marginally helped by a limited fuel price tailwind in Q3 2026. In Latin America, we delivered double-digit growth, notably thanks to the attractiveness of our Beyond Fuel Solutions such as toll, maintenance, and freight payment, which grew double digit, underpinning the breadth of our offer. In Europe, we recorded double-digit growth in Germany. Also worth mentioning the continuous traction of our EV offers. Overall, Mobility continues to demonstrate its resilience and capacity to capture structural growth drivers. In Benefits & Engagement, accounting for 64% of Edenred's operating revenue, we delivered EUR 424 million in Q3 2026, down 5.9% like-for-like versus Q3 2025 as expected. Adjusted from the regulatory impact in Brazil and Italy, operating revenue grew 5.8% on an intrinsic basis.
Virginie Duperat-Vergne: This mainly reflects the robust growth in Latin America and in Southern Europe like Portugal or Greece. In Beyond Food, we saw double-digit growth in Latin America. Payment Solutions and New Markets now, 6% of Edenred's operating revenue. Operating revenue came at EUR 41 million in Q3 2026, down 0.5% like-for-like versus Q3 2025. The business line delivered strong double-digit growth in our digital gift business in Taiwan, offset by two elements, the slowdown in UAE due to the Middle East conflict, and to a lesser extent, by the remaining effect of the exit from the banking-as-a-service B2C business that will last until year-end. Moving on slide 19 to geographical areas. In Europe, up +2.9% like-for-like in intrinsic growth. The performance benefited from a continued solid momentum in Germany and France in Mobility, as well as a solid performance of Edenred Finance VAT recovery services.
Virginie Duperat-Vergne: In B&E, the sustained performance offset by a high basis of comparison due to a one-off effect in Italy last year, where we registered a high level of meal and food orders coming from our clients in July and August before the change in regulation, which is less favorable for them. Latin America was up 13.6% intrinsically versus the same period in 2025. This is driven by the double-digit growth of Mobility, notably thanks to the success of our Beyond Fuel Solutions offer, maintenance, toll, and freight payment. In Benefits & Engagement, the double-digit intrinsic performance in Mexico and Brazil has been offset by the full impact of the implementation of the Brazilian decree. In the rest of the world, we were up 6.6% on a like-for-like basis, supported by the double-digit growth in Japan, Taiwan, and Turkey, but hampered by the performance of the UAE.
Virginie Duperat-Vergne: Moving now to the other revenue on slide 20. Other revenue which are growing +0.3% as reported for the first 9 months period of 2026 versus 2025. This sustained performance reflects the higher float driven by Benefits & Engagement volume and interest rates higher than expected. This allows to compensate the effects of the expected Brazilian regulatory change and the ongoing banking-as-a-service B2C exit. As a result, we now expect a minimum of EUR 210 million for full year 2026, acknowledging that this number is also dependent on foreign exchange evolution, which was a positive 0.2% on the first 9-month period. Now, if we move to the guidance on Slide 22.
Virginie Duperat-Vergne: For full year 2026, we confirm our objective, namely a decline in EBITDA of between -10% to -7% like-for-like, unchanged compared to our previous guidance, but which now translates into an equivalent of a range of around EUR 1,220,000,000 to EUR 1,260,000,000. Please note that our previous range of EUR 1,230,000,000 to EUR 1,270,000,000 has been reduced by EUR 10 million to reflect the scope effect related to the various M&A deals we closed in Q3, and notably Edenred Pay North America deconsolidation. A free cash flow to EBITDA conversion rate of at least 35% at comparable regulations and methodology. As you know, 2026 is a rebasing year for Edenred. However, we continue to accelerate our strategic investments and execute disciplined management actions. So stepping back on Slide 23, we remain firmly on track to resume solid EBITDA growth from 2027 onwards.
Virginie Duperat-Vergne: Our confidence is underpinned by the diversification and resilience of our business model, our leadership positions in structurally growing and under-penetrated markets, and a disciplined strategy centered on adding more users and increasing revenue per user. In that regard, the deployment of Edenred+, the group's new best-in-class multi-benefit platform, which is API-native and cloud-native, will supplement growth for the next coming years. Beyond that, we see additional growth opportunities from the increasing use of data and AI, as well as from the current macro environment, including higher face values, fuel cost control needs, and higher interest rates. So while the macro environment is challenging, the underlying fundamentals of Edenred remain strong, and the levers for renewed EBITDA growth are clearly in place. Ending now this presentation, Edenred will resume sustainable and profitable growth in 2027 and 2028.
Virginie Duperat-Vergne: Thus, we confirm our outlook, EBITDA like-for-like growth of +8% to +12% in the years 2027 and 2028, and a free cash flow to EBITDA conversion rate of at least 65%. I thank you for your attention. I will now hand you back to the operator for the Q&A session.
Operator: Ladies and gentlemen, for sell side analysts, if you wish to ask a question, please dial #5 on your telephone keypad. The next question comes from Zack Al-Khairi from Morgan Stanley. Please go ahead.
Zack Al-Qaryooti: Good morning. Thanks for taking my questions. I have 2, please. Firstly, you've discussed this transaction involving Edenred Pay in North America over the summer. When you look at the current portfolio, excluding that, is there anything else you now consider non-core that might be another suitable candidate for other strategic options similar to that? The second question, just on the intrinsic growth in Benefits & Engagement. It was slightly slower in Q3. I think you called out that it faced a tougher comp in Italy. Are there any other pockets of weakness relative to Q2, maybe in Europe, or any macro-driven weakness that you would call out? Or is it entirely driven by this comp effect? Thank you.
Virginie Duperat-Vergne: Good morning, Zack, and thanks a lot for your question. In fact, I think that we have probably achieved the major bunch of what we want to get out from our portfolio. But you might still have. Company is always in movement, life is changing, and we regularly have reviews where we assess what we are doing. We might get out from small countries, non-scalable or things like this, or also in the future have attempts of doing something and deciding it doesn't fit. That's what it is about. But with what we have achieved up to now, we probably have achieved the very vast majority of what we had in hand. Then moving to the intrinsic growth, you are absolutely right. The big effect is really the high comparison basis that we had last year.
Virginie Duperat-Vergne: In Italy, obviously, before the regulation changed, we have seen our clients pushing extra orders. When we compare year on year, we have this effect to take into consideration. That is probably the main driver. We have a little bit, maybe a different situation than we have seen in H2, also compared to H1. Last year, if you go back, you had an H1 with less traction than we had with H2 as a whole. We have, as a consequence, a higher basis of comparison, H2 2025 versus H2 2026. What we see at the moment in Europe is probably, yes, a little bit less enthusiastic than what we may have seen in the previous quarter. Hence, growth is solid, and we still have a good expectation for this campaign that will be the big element of our Q4, like every year.
Zack Al-Qaryooti: Very clear. Thank you.
Cédric Appert: Thanks, Zach.
Operator: The next question comes from Pravin Gondhale from Barclays. Please go ahead.
Pravin Gondhale: Hi, good morning. Thank you very much for taking my questions. Firstly, on the partnerships like Silae, particularly Silae, can you help us understand the dynamics of the partnership? How accretive will it be to the group's operating revenue? Are there similar partnerships in the pipeline? More broadly, what percentage of group's revenue come from distribution partners like Silae, Grupo Bimbo, or network of chartered accountants that you mentioned earlier, and how that has evolved over years? Thank you.
Virginie Duperat-Vergne: Thanks a lot, Pravin. Yes, we are very happy of this partnership with Silae, but you are absolutely right, it is not at all the single indirect distribution partnership that we have over the world. In Benefits & Engagement, we have several partnerships with some banks distributing our meal voucher in numerous countries, namely in Latin America. We also have some in Mobility. I think we referred several times to the partnership with Nubank on toll, which allows us to access the B2C market. That is part of the interest also of this indirect partnership, is allowing us to access other type of markets that we would not access easily on our side. Here in the case of Silae, this is a platform to aid, pay slips, and manage the payment of the payroll every month for the employee.
Virginie Duperat-Vergne: This is really probably the biggest or the leader on the market for the SME. As you know, in France, SME for us, a vast market which is untapped. It is a direct access because our two platform are directly connected, and it is very easy then for any client of Silae connecting to their usual interface to see what is happening on their payroll and managing that, to now just have a kind of press button opportunity to get access to meal vouchers from Edenred France directly. That is the simplicity of this for the clients, but also for us in terms of pushing an offer which we value and which we think can be quite a strong driver.
Virginie Duperat-Vergne: It happens that in France, obviously, the SMEs rely on independent accountants to manage their payroll, and they are the one indicating also and pushing Silae, and they are generally trusted, obviously, by their SME clients. So it is in fact having access to a very large scattered network, which becomes more or less the additional ambassadors and the additional sellers of Edenred France offering to SMEs.
Pravin Gondhale: Thank you. This is very clear. Thank you.
Operator: The next question comes from Justin Forsythe from UBS. Please go ahead.
Justin Forsythe: Good morning, Virginie. Thank you for doing this. A couple questions on my end. The first one, I just wanted to follow back up on that employee benefits intrinsic growth that you were speaking about. Given the comments around the base effects, just a couple of follow-ups there. One, does that mean that we should also then expect an acceleration in intrinsic growth in Q4? Are there any other puts and takes there? You did not really mention macro anywhere in the slides or in the press release, but you did mention it towards the end of your prepared remarks there. So maybe you could just elaborate a little bit on how the macro was impacting, if it was at all incrementally compared to Q2. The other question I have is around other income, so interest income.
Justin Forsythe: It seems like you beat the expectations, and you reiterated that EUR 210 million floor. It seems to us like even if you just took a run rate, so you say EUR 58 million in Q3 and then another EUR 58 million in Q4, you are going to be probably closer to EUR 230 million. So is that the right way to think about it? Are there any other puts and takes there, for instance, something like float-related balances? What does that say about operating EBITDA and operating revenue? Is that then given you reiterated that guide and implicitly lower either operating revenue or operating EBITDA expected for the remainder of the year? Thank you.
Virginie Duperat-Vergne: Thanks, Justin. Just to make sure, because sorry I missed that word. Are you talking about deceleration or acceleration in Q4?
Justin Forsythe: The first one.
Virginie Duperat-Vergne: For the intrinsic growth.
Justin Forsythe: Yeah.
Virginie Duperat-Vergne: Yeah.
Justin Forsythe: Well, I am just asking what the expectation should be for Q4. Are you implying because it is base effects in Q3, and obviously Italy was worked through, that was the high point it sounds like in terms of those pre the regulation acceleration, if you will, in contract sign, if that then implies that the comp eases in Q4 and you should see an acceleration in intrinsic.
Virginie Duperat-Vergne: Okay, thank you. In intrinsic growth, I think that a big unknown will depend on what we get from our Q4 gift campaign, which is quite an important element, obviously, of the Q4. But intrinsically, we expect to be a little bit on the same type of trend that we have seen in Q3. Again, we have, for different reasons, a high basis of comparison, H2 2025 versus H2 2026, that we will see. And we start thinking that maybe Europe is not really slowing back, but because in fact we have a lot of acquisition of new clients, but existing portfolio can be a bit under contraction. And in the current environment, we think that this might also be something that we will go on seeing. We pay attention to employment rates also, seems to be a bit less encouraging, I would say.
Virginie Duperat-Vergne: All in all, good commercial traction, face value increase, that we have been nurturing, that start paying effect, but we will probably get a better effect in 2027 than what we have. And on the rest, maybe a bit less volume in terms of employment rates decreasing in our existing client base. That would be a little bit what we see for Q4, and we have good hope on our gift campaign. Let's remind that last year we were launching our new platform, Explorer, for the gift in France just at the moment the campaign was starting, so it had good effect, but we had not a lot of readiness in advance to prepare client to get used to it. And after one year, we hope we will see traction on that front also, despite the current French environment. So that's what it is.
Virginie Duperat-Vergne: On other revenue, maybe, you say that, I understand perfectly the maths that you are doing. I think that we are going to have a bit less other revenue in Q3 on our side. Number 1, we have interest rates decreasing a little bit in Brazil. So obviously, even if Brazil is lower, it remains an important part of what we get in terms of other revenue. So we will get a lower absolute value. Obviously, there might be a little bit of positive foreign exchange effect, but due to the uncertainty of the results of the election, I think FX on Brazilian Real can move very, very fast. The other element that we have in mind is that part of our other revenue is also coming for the rest of our countries, including hyperinflationary countries such as Turkey.
Virginie Duperat-Vergne: We will have to put that at the rate of the latest day of the year, brutally the entire P&L, when we will get the final FX rate, which always has an impact on what we deliver in Q4.
Justin Forsythe: Okay, got it. The takeaway is that
Virginie Duperat-Vergne: That is why, I think that the EUR 210 is not a stupid stuff.
Justin Forsythe: Got it. Yeah. A material decel or materially lower amount of interest revenue in Q4. That is very helpful, Virginie. Thank you so much.
Virginie Duperat-Vergne: Yeah. Just take the banks forward in terms of where Turkish lira should go, and that is more or less what I have in mind.
Operator: The next question comes from Josh Levin from Autonomous Research. Please go ahead.
Josh Levin: Good morning. I have two questions, both are about Brazil. In Brazil, iFood is buying Caju. What does that mean for the competitive landscape? The government in Brazil has said that it does not believe that meal voucher companies are fully complying with the new rules, including the commission gap. How do you see industry-wide compliance with the new rules in Brazil? Thank you.
Virginie Duperat-Vergne: Thank you, Josh. I think that the transaction between iFood and Caju is probably the confirmation that even in this new environment, this market remains an attractive market where you can develop quite a number of nice businesses. We always said that there is a large number of issuers in Brazil, so consolidation was probably to expect, and especially after a change in regulation, which makes life more difficult for a number of small incumbents. That is probably what results in this transaction, which has been announced yesterday night. Then in terms of compliance with decrees and such, I think that in reality, we have all the decree on the table with quite, let us say, not a lot of detail and with a lot of uncertainty, and all the participants on the market work and try to understand where it goes progressively.
Virginie Duperat-Vergne: My understanding is that at the moment, everyone is working quite the same way on the market, and we have still a lot of questions on what it means, open loop interoperability, how it will be, let us say, assessed by the market, and we are fully compliant with what we understand, with the question we raised and the answer we received. I think this is what, let us say, the whole of the market is trying to be doing at the same time.
Josh Levin: Thank you.
Virginie Duperat-Vergne: Thanks, Ash.
Operator: The next question comes from Hannes Leitner from Berenberg. Please go ahead.
Hannes Leitner: Thanks. I got also a couple of questions. Looking at this intrinsic operating revenue growth, you also called out today face value increases like Japan. First of all, maybe a little comment on Japan, how much is its operating revenue contribution overall. Then can you maybe break down the 7% intrinsic growth in face value, then maybe net customer growth, to see a little bit the building blocks. Then maybe the second question is on Italy. Can you explain what means early orders? Because if I have a regulatory change, why would a customer, a client, a corporate order meal vouchers ahead? How is that? Did you run their promotions, et cetera? The second part of that question on Italy, can you give us an update on the remedies? I think there was a complaint that you have charged additional fees circumventing the 5% cap.
Hannes Leitner: Maybe you can give us the latest. Thank you.
Virginie Duperat-Vergne: Thanks a lot. Face value in Japan. Japan, as I said, is quite a small country today, but it is the fastest-growing country. That is why we thought it was very interesting to signal. We have a new market emerging. It is not really a new market because we have been there for years, but we have pockets of market where we can see acceleration from time to time due to a positive change in regulation. This is one of those reasons why we want to try like that. In a few years from now on, maybe, we will discuss that with Japan representing a larger scale of what we do globally in the world because it is quite a wide market. But it is not the only one.
Virginie Duperat-Vergne: I could also mention Argentina, where we are launching, as we speak, a meal voucher in the framework of the new bill that has been enacted recently. It is constantly being renewed market. In terms of Italy, last year the law was changing 1 September, and after that law, obviously there was rebalancing, and as you remember, probably we had started and achieved the last part of renegotiation of contracts with clients that would start either 1 September or 1 January, depending on the negotiation that we had. Obviously it was in the interest of some clients to push a high volume of order before the contract change and become a bit more unfavorable to them. That is why we saw quite a volume of orders being pushed in July and August just before the change. That is what creates the detrimental basis.
Virginie Duperat-Vergne: Obviously, this year there was no reason. The orders of the clients were more linearized over the year as you could expect them to be. In terms of remediation or, let us say, the follow-up on the antitrust discussion in Italy, we have made some proposal of remediations to the antitrust authorities, which the authorities have decided to be tested on the Italian market. This test is currently happening and is up to hand. There will probably be a kind of 2 months period or something like this, of analysis of how this test has been bringing or not result before for the antitrust authorities to coming back to us and to the market with what could be the new rules probably for next year, I would say. That is what we see today. It is probably the update.
Virginie Duperat-Vergne: We are very confident that this process will get to resolution in this timeframe. This should, let's say, allow to move to the next phase.
Hannes Leitner: The building blocks on the intrinsic growth reported to get to the 7% in Q3?
Virginie Duperat-Vergne: Well, I think it's probably half and half. We have done a lot of acquisition of SMEs. We've seen quite a strong traction. Not only that, because you've seen we highlighted that with Jimbo. We've been able also to capture in a number of countries where we operate quite a nice LNAs. So we've seen strong traction in volume in Latin America notably, but also in Southern Europe. In face value, we started the year with quite a strong portfolio, more than 50% of our portfolio, where we have the ability to develop face value. So that's definitely a boost. But there's still a lot to come for 2027 and 2028 with the face value that has been voted earlier. The third element above face value is obviously the cross-sell with the other solution. The gift, remember that we highlighted that earlier.
Virginie Duperat-Vergne: Kadéos, also in France, for example, is creating quite a strong traction and bringing double solution into the portfolio when we sell to our clients in France. So all in all, the 50/50 between Accor Live Limitless and Enrich is probably a very good view that we can have when we see this in pretty close.
Hannes Leitner: Thank you.
Operator: The next question comes from Kate Xiao from BofA. Please go ahead.
Kate Xiao: Thank you very much for taking my questions, Virginie. I have two, if that is okay. First one, can I ask about your PSNM business? Obviously, it is down slightly in Q3 because of Middle East and exit of your business. I wonder, what is the intrinsic growth there, if you exclude the impact of all of those, and how should we think about your underlying growth rate of that business going forward? Second, I would like to follow up on your SME partnership in France. Can you tell us what do you expect France as a market to grow in terms of user growth? You may be helped by initiatives like this. And how much user growth have you achieved so far? Thank you.
Virginie Duperat-Vergne: Thank you, Kate. Starting with PSNM. PSNM is obviously having the UAE business into it, which has managed to, let us say, get through H1 relatively immune from direct impact of the war, and we started to feel it end of Q2 as we mentioned. And we have now a full quarter of impact of the war. And that goes against, I would say, the strong double-digit growth that we still have, for example, in our Taiwan business in digital gift offering, which is, let us say, working as it has always been quite strongly. And that is probably the two big elements, one going against the other.
Virginie Duperat-Vergne: After that you have the banking-as-a-service element, which progressively we are weighing down, which was weighing on us very heavily in 2025, but still goes on weighing in 2026, and is notably, let's say, decreasing in terms of absolute value of other revenue coming from PSNM quarter after quarter. That is where you get more or less to a kind of small growth, because UAE is a relatively large business, and it used to be a very strong double-digit growth that we had in mind and that we had seen before. Then, sorry, the SME partnership and Silae. The acquisition of SME in France. SME remains a vast under-penetrated territory for us where we can really access companies. Beyond SME, you have very small companies also, which is a very strong base that we can acquire.
Virginie Duperat-Vergne: Definitely, this is an easy way of acquisition with a relatively low cost of acquisition because you have the base of clients of this platform. Well, almost you put your fingers directly into it. This is what it is. Then, let's say will it be a big immediate accelerator or game changer? It is as always, you have progressive ramp-up for people to realize what it is, for the external accountants of the network of Silae to get used to it, start having it on one of our clients and then pushing it to the other clients and things like this. We will see how it works. But on other indirect distribution channel that we have developed an indirect partnership, after a few years, it is always a strong basis of acquisition, which is a little bit working perfect.
Kate Xiao: Thank you very much.
Operator: The next question comes from Estelle Landau from JPM. Please go ahead.
Estelle Weingrod: Hi. Good morning, and thanks for taking my question. The first one is on Brazil. Can you provide an update on the progress of the implementation of the Open Loop specifically, which still seems to be taking a bit more time than initially expected? Do you expect any impact from the potential Bolsonaro's win on the sector? The second question on France, could you just comment on the recent events, the social unrest, just to see if you would expect an impact on Q4? Thank you.
Virginie Duperat-Vergne: Okay. Thank you, Estelle. Open Loop is, as we see today, yes, definitely taking more time. It's definitely a delay. How long will last the delay? We don't really know. What we know is that, let's say the incoming potential new acquirers are not very numerous. It's taking quite a long time to see the things moving. So today, we probably operate not very differently than we used to operate at the beginning of the year. Based on what we see, and we have no crystal ball, and we also have no view on what will be the outcome of the current election. Honestly, it could last for longer. So we do not anticipate a very different Q4, let's say. We have in mind a small incremental adoption of Open Loop. That the only way that we can see.
Virginie Duperat-Vergne: It's very difficult to give you more than that because we have no crystal ball on evolution of that. We can just state what we see as of today. Then in France, on social unrest, I think it's sad to see that for all of us here, and that's it. For the rest, will it have an impact on Q4? Honestly, we don't foresee that at the moment. My impression is that everyone is working as we see. I think that the impact is more coming from the current, let's say, macroeconomic environment, as we said, contraction on portfolio, potentially on some clients in terms of volume of employees. On the other side, there might be a kind of push or envy to, let's say, renew the ability of the employees to access market and maybe we'll have a good surprise in this campaign.
Virginie Duperat-Vergne: It might be that it would be more back-end loaded toward the end of the year if people wait a little bit to see what things are moving. Let's remember that France is 14% of our operate. So we also have a lot of other areas where we can extract our operating revenue and the EBITDA for the Q4.
Estelle Weingrod: Thank you, Virginie.
Operator: There are no more questions at this time. I hand the conference back to Virginie Duperat-Vergne for any closing comments.
Virginie Duperat-Vergne: Thanks a lot for your participation today. Maybe remaining what we have been conveying during this Q3 conference and with our press release this morning. We are very confident to deliver on our full year 2026 guidance within the brackets of our -7% to -10% EBITDA guidance that we have reaffirmed today. We are highly committed on the execution of our Amplify 25-28 plan. We are progressing on the implementation of all the steps we wanted to take, namely on the delivery of our high-end platform such as the cutting-edge Edenred+, which is to be now fully implemented in France and accelerating quite strongly in Mexico notably. We also progress in the rest of our data and AI projects that we have put on the table.
Virginie Duperat-Vergne: With that, we feel that we are on track to go back to, let's say, profitable growth in 2027 with the guidance that we have reiterated today of an EBITDA like-for-like growth of +8% to +12% in 2027 and 2028, with a cash conversion rate EBITDA to net debt coming back to the +65% run rate that we have in mind. I thank you. I hope you will have a good day today.
Operator: The host has ended this call. Goodbye.
