emeis Société anonyme (EMEIS) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to the Half Year Results Conference for 2021. [Operator Instructions] Now I'll leave the floor to Steve Grobet, EVP, Investor Relations and Communication. The floor is yours.

Hello, ladies and gentlemen. Welcome to this presentation for the half year results for 2021 for the group. Happy to meet you and hopefully virtually for this time. In this presentation, we'll have the pleasure to welcome Yves Le Masne, Chief Executive Officer of the Group; Sebastien Mesnard, CFO; myself as EVP for Investor Relations and Communications; and Madam Laure Freres, EVP, Wellbeing, Medical, Quality and CSR and she will be presenting the project for 2023. Let's start with a reminder of our business model, our activity. I'd like to remind you that Orpea is in 25 countries throughout the world. And wherever, the objective of the group is to develop a comprehensive offering, taking care of addictions and of elderly people. We are one of the main actors in France, in Switzerland, in Germany for people with addictions and in nursing homes to accompany people who are not completely dependent yet, but they are semi-autonomous. Of course, we are present in the midterm and long-term care. And also for rehabilitation and mental health hospital, either in complete hospitalization in the hospital configuration because we have these also in Mental Health Hospital. We have dedicated care for youngsters, for children and for adults. So a comprehensive offering, taking care of any kind of fragility and this is the motto that we try to develop throughout the world. Let's now talk about the COVID-19 situation and the vaccination. Let's start with the vaccination. I'd like to remind you that the vaccination campaign started in January, February. We managed, some years ago, to attain a really satisfying level of vaccination. We are at 91% vaccination for the residents. There is a part of our residents that are not eligible for vaccination for because of infection, particularly the illnesses. And this last week, we've had a significant acceleration in the vaccination of our employees. There is an obligation for that since September in France. And in France, we have 98% of our employees that are vaccinated. So 95% globally. We will take stock about the vaccination of employees in Switzerland and Germany. In these countries, we only count employees that are vaccinated that work in the homes in the structures. It was the same thing in France before the rule and the obligation to vaccinate all of the health workers in person now. And these people outside residents would represent about 30%, 40%. We moved -- we went from 60% to 90% of employees vaccinated just by counting the external workers that we were using that were not taken into account before. I'd like finish on vaccination by adding that concurrently to the regulations and indication by the authorities, we started the third dose vaccination that's called a booster. This started in France in several companies. The effects have been quite immediate because since the end of March, we have had basically a normalization of the health situation. This situation is really well controlled. We have less than 0.2% of positive cases either in the residents or the employees. So really a slow rate. 90% of these are asymptomatic. This is proof that vaccination works quite well. The consequence of this vaccination campaign has been the fact that 90% of our structures are COVID-free. And this, of course, has led to a decrease in the death rate, which we're really happy about. We will get back to this later. Let's now move, leave the word to Yves Le Masne, who will talk mainly about development.

Thank you very much, Steve. I'm Yves Le Masne, CEO of the Orpea Group. Talking about developments, we acquired 6 value-creating structures, 42 facilities and 4,700 additional beds. The problem of the group is that we were going to pay 12 to 18 to 20x more. And so we were looking for intermediary structures to be acquired. And some years ago, we acquired a small group in Switzerland that became in time #2. It's a family group that had some other groups attached and 1 namely in Austria. It has become in time, #1 in the sector, 50% of the private sector, and we continued like that. Why family-led group? Because most of the time they have a culture, they do not follow the EBITDA necessarily. They care more about the quality of the service. And then, of course, we can teach them what they lack. So we want to continue with this wellbeing, with this care culture and bring the results. And there, we get to Ireland. We have a similar approach. There were about 10 groups in the markets in these countries. There was 2 groups representing 1,000 and 1,200 beds. We made a first acquisition about 600 or little over 600 beds and then we completed the investment with a second one, bringing us to 1,200 beds. And then we acquired a third, a fourth, the seventh of the country. We became #1. We have, for instance, in Dublin, more than 50% of the market with some -- with the team that we -- as we found in Austria previously, allowing us to develop. When we acquire a group, there are managers there that we can work with to increase the revenue and the coverage. The size of Ireland with our project has more than doubled -- and as we did in Austria previously, we doubled the size of the group in the country before in Austria and then in Ireland. So we completed the acquisition with the key establishment and the manager of the group that we had acquired in Ireland had nice relationship with this group. So we acquired the Belmont House. We have some pictures to show it what it is, is one of the most prestigious facility in Dublin, and this is quite a showcase for us. We've become #1 in Ireland. So a lot of beds in development in the pipeline yet to come in Ireland. So with 2,284 beds, representing EUR 135 million. In Spain, we've carried out a strategic acquisition of Hestia, #1 group in post-acute care and rehabilitation in psychiatry. So it was a strategic acquisition. As I said, the first group of post-acute care rehabilitation in psychiatry in the country. Through this, we want to develop rehabilitation in psychiatry in this country, and we -- you have to see we try to choose always the excellent locations. The structures here are in Madrid and Barcelona, as you can see from the slide, with the potential developments and extensions that are possible. This coverage has allowed us to complete our presence in Spain with 14,300 beds as a total, 87 facility and 3 complementary businesses since the updating of the network in next March. So the network of the group integrated this as 6 actually acquisitions. We are present throughout the world in 23 countries, divided in 4 main geographic areas. The first one, France, Benelux, 4 countries with 49,207 beds. Central Europe, where there are Germany, Switzerland and Italy, with a little less than 30,000 beds. Eastern Europe in important development with a little over 15,000 beds. The fourth is Iberian Peninsula and Latin America where there are a little over 23,000 beds. And when you look at these 3 areas, you see that 80% of our development is right now in Spain. Now we have other countries as well, regrouping for the moment only China. So the division of this network. When you look at the breakdown of the beds and the pipeline, this is more or less similar in several areas. So France, Benelux and Central Europe. So an interesting pipeline on the Iberian and LatAm Peninsula. 5,000 beds in the Iberian Peninsula and the rest in LatAm. Whether the opening of the construction price, a global network with an important number of beds available. So let's look at the pipeline, more than 26,000 beds on the extraction. The potential of development of the group to give you an order of a greatness this represents in a term in the next 4 to 5 years, EUR 1 billion in additional turnover. So even if we were to say that today would stop creation. This is not the case. I'm just talking by example, we would still have EUR 1 billion of additional revenue in the 4 to 5 years to come. We have prices higher by 15% to the mean or payer and the sector prices and the ancillary definition of this are excellent localization inside within the great capitals of Europe and also in Latin America. So this pipeline is -- represents more or less 70% of premium facility to feed our future growth. Now let's look at the opening and acceleration of the openings in 2021. More than 4,000 beds. It's going really well since the beginning of the year, several facilities opened since the beginning of the year and more to be opened before the end of the year. 32% in France, 20% in Central Europe, 23% in Eastern Europe and 25% in the Iberian Peninsula and LatAm. We will open our first structure in Rio in one of the more exclusive facilities of the Bay. We have a sweet story with the high-end facilities as spa, restaurants and other activities that will be open inside and outside of the facility. So we opened more and more to the exterior facility. Another example of a new opening. We opened a structure in Poland, 168 beds. This is in our first facility with really topline services for orthopedics, where the cutting edge equipment using 3D, using new devices and equipment based on cartilage research, and we implement Orpea know-how in the center of a Warsaw in Poland. Another example, the third opening of the year in Spain in Bilbao, a nursing home of 5,000 square meters in the center of Bilbao, less than 500 meters from the great Bilbao Natural Park. So I had this facility, and 1 last example, Dortmund in Germany, a nursing home also implementing home services and home follow-up on the -- just really on the Dortmund lake. So really exquisite facility. Let's now move to Sebastien Mesnard to the half year results.

Hello, ladies and gentlemen. So a really important increase of the activity with an increase of 8.7% at EUR 2070 million, more than 5% in respect to 2020, so we confirm the objective. This half year has seen an important increase with the progression of the EBITDA, a net result of EUR 102 million with an increase by 40%. We also reinforced the financial capacity of more than EUR 1 billion and also reinforce the -- our pattern money. The turnover by geographic zone on France and Europe, an increase by more than 10%. Central Europe, plus 3.4% and the Iberian Peninsula, a lowering of 16%. Now a focus on the organic growth. We have an increase on the second quarter of 1.5 -- 0.9%. So the growth of 5.2%, a small precision organic growth on the half year was not -- it was by 2% and 0.3% on Central Europe, 10.9% on Eastern Europe and minus 12.5% in the Iberian Peninsula. The main acquisition on the semester have been made in France, Switzerland, Ireland and the Netherlands, as you have seen in the previous slides. The negative net impact of COVID-19 on the first half year was lowering by 33% in respect to the same period in 2020. This net -- this negative net impact is 160 basis points on the EBITDA, bringing the loss in activity to EUR 18 million. 30 basis points on the personnel costs. If we add this 170 basis points to what we have on the margin of 2021, we would have a margin EBITDA of 26 -- 25.6%. So it's superior to 2020. We compensate in France and in Germany, in Austria and in Belgium, and we are at a loss only in Italy and Spain. 26% in France and Benelux. I'd like to remind you that in 2020, there was a decrease for the nursing homes whilst in 2021, we see a rebound and an increase. On Central Europe, we have an increase of this margin. This is linked to the structuring of the headquarters especially in Germany. In Eastern Europe, we have 15.2% of increase in respect to the previous year because, especially in Austria, we had in 2020, a complete closing of all clinics, and these have reopened in 2021. There was also a remarkable increase in Spain and this is linked to the improvement of the structures, namely in Spain, and no compensation, as I said, in Spain. Let's move to Page 25, a net profit group share in strong increase of plus 40%. The personnel costs see an increase of 9%. EUR 84 million, an increase by EUR 15 million, representing EUR 4 million linked to the calculation of taxes against EUR 44 million in the first quarter. The compensation linked to the decrease of the turnover have to be in charges and products and compensation linked to the augmentation of the increase of costs are divided by nature. Rentals have decreased EUR 168 million. So we have plus 40% on the whole half year, plus 10.2% connected to our strategy, as said. And also financial debt, which is decreasing as well and EUR 12 million for noncurrent elements, which gives us 1 global result of strong increase of plus 40%. So 30.9% then decreasing as compared to the last semester. And also, we have decrease of 50% of several CDAA for 2020. Next slide, we have great cash flow statement for the first semester, more than EUR 800 million. So it is still for our EUR 86 million for real estate investments as well. So participations and so on. So EUR 178 million. We also had a strong program for financing of EUR 652 million. Now cash flow here is variating. According to last year results, this is a decrease connected to the mechanism of cash flow, which is fluctuating. And also, we had EUR 29 million disposals of real estate. So we have still great commitments on that. And we are -- we hope to get to the objective till the end of the year. Next slide. Here, we have EUR 12 million for the whole global structure for EUR 4 million to EUR 7 million, an increase of 6%. So plus 463, this is connected to the support and fund to EUR 6.8 million. This decrease is connected to the real estate. So this long-term financial debt as we see here, which is 1.7 for the restated financial leverage and 1.8 for restated gearing. So 2.2 until the end of December, and we have 6.2 years for the duration of net debt. High successful debt issues for Orpea in 2020. So first sustainable EUR 500 million 7-year bond. This is a 2.2%, which is green and social, which is aligning with the sustainable objectives and the sustainable first bond, green and social. And we have EUR 1.0 billion in France and also EUR 395 million for the record Schuldschein issuance. So we've a 5-year program. We have still great part, which is 54%. And this is the result that we can see over the 5 years, which the debt profile is significantly optimized, plus 1.2 years for a total duration of 6.2. Thank you. So health care stated on Slide 31, as we have seen a very strong increase in volumes. H1 has 64% of the transaction of the fiscal year 2020. So this is extremely important as well with the international investors because we have growing interest from them. And this represents 60% of flow, 54% of flows. There could be announcing homes, 63%, but also already what we have developed, developed with assisted living 11% and also great increase of investors. We also have a strong decrease in yields. Health care assets across Europe and 4.5 in Germany, as you see 4.5 -- 4% in Germany. So France as well. We are in this situation, Spain nearly 5% and Belgium 4.25%. So this is actually what happens on all these 4 countries. So an average decrease in these key countries. So for Orpea, we have 5.3% globally, so we are above the rates we have seen and the levels we have seen in the other countries. And also, we have between 4.1% and 4.6%. So that confirms what I've just explained for our group. So we have stability as well. So 47% stability for real estate ownership rate. So this is as well another core business point. So we're the first operator with -- I mean fist European health care real estate company. So as said, that corresponds to what we have in our peer groups. So 70% of the sites are in France and Benelux. So we have, of course, Spain in good shape, but also Eastern Europe, Austria, mainly Central Europe with Germany, and this corresponds to the risk between 4% and 4.5% as we saw before. So this means that globally, we have great capacity. And also, we have this capacity to have this rate, which is stable as compared to the previous semester. Now what about the inflation effect on Orpea? We have actually several examples. The only negative example that we have could be connected to the rates which could increase. So 1% gap, which is between 4.2% and 4.3%, which is high. So still this effect, which allows us not to have -- to be jeopardized. And also this is positive for service company because we have still an increase, first we have regulations in France, for example, 1% annual increase, which is of course, connected to all the increased globally of wages that we have in groups. And as we had before, which is actually see 0% to 1% in that field. So for all the revenue, it is an excellent news to have inflation. So as said, we have 1% for rent. So capped more than 50% of lease in France with indexings capped at 1%. And as we always said, we are covered 100% stability of current borrowing costs. So 100% of debt is hedged. So no risk to have even EUR 1 increase if we had an increase. So no provisions last year, by the way, because we were to 0, and that could be also important to have an increase. So future debt could increase, but that is connected to anyway the global results which are positive. And in fact, for our development, we were talking about 20 points. Why? If the debt is 0 regardless of the number, which can be positive. So this is why we're extremely cautious on acquisitions, not to get too high to 10 to 12 points. And this is why we find other targets of other countries to have more interest and to have other ways of development and all the situations. Now I would like to give the floor to Laure. Laure, you will cover the CSR strategy and the 2020 roadmap.

Good morning. I am Laure Freres, in charge of CSR strategy. And I will introduce to you our positioning and approach. A few words, first of all, to explain how we have built a position and also to see the work we have done, taking into consideration, of course, all the stakeholders with the, of course, nothing from the family, the employees and so on and all the Orpea participants. So our daily mission, of course, is to take care of fragile person. And the central, the core value of our strategy is human value. So women, men, families, facilities to take care of patients. So a few elements here, 9 markers for our CSR strategy. So I will not get into our -- into details on the 9 markers. First, the CSR native. This is #1, which means we are committed in these values, which are so much important to also build our facilities, health care centers to have a lot of comfort and also caring human people and, of course, second marker is go local. What does that mean, of course, is to work gather global and local. So why? Because our road map that we'll see is developed in all our countries and also will be adapted locally to the patients of course, employees and facilities. Third marker is the motion of evolution. So why? Of course, this is connected to our 2023 vision. We need to keep in mind that this roadmap will evolve, of course, in the following months. So in order to enhance this strategy, we wanted to integrate this strategy in all the groups and bodies. So first of all, the Board of Directors and CSR Innovation Committee in order to see clearly the definition of orientation, monitoring the process and the CSR approach because management inside the group must be integrated to that vision. So we need to have this governance in all countries, in all facilities and for each meeting that we have, we need to deal with this follow up, I mean, this roadmap follow-up. So we need really to stick to that. And also we need to have a lot of criteria put together inside this vision. Now let's see in details what is this ambitious 2023 CSR roadmap, 16 objectives actually. Of course, we'll not get into details for each of them. But first, what is connected to residents, patients and families, 100% of facility certified by the outside body. High level standards are involved. And also, we have in certain countries ambitions on that level. Also, we would like to have 100% of our facilities will, I mean, be developed and be managed in a way that we can, of course, take into consideration a global mechanism of well-being. And for us, it is key to fix, to define the commitment of all the practices. Now as for collaborators, employees are concerned, first of all, security is key. Of course, this is a key value that we have in Orpea to preserve security and health. And through prevention programs, we want to continue to reduce 15% of work-related accidents. But also, we are extremely careful to our collaborators' careers, and we actually have 10% of employees, which have obtained diploma inside that. And we would also like to have 50% internal promotion of regional directors, facility managers, but also the head nurses and as well together with the diversity of profile, but also complementarity of women and men. We have fixed established 50% women present in top management inside the group for 2023. And also without the last point here, maybe point 4, which is an environment. We have 2 commitments here. First, 100% of new buildings from 2021, certified HQE or equivalent. And we have the willingness that new facilities are inside this approach to have this environmental certification according to countries, obviously. Another key point here about CSR strategy. So actually, 2 elements in a new environmental strategy. So the willingness to support all the objectives that we have here and to deploy programs, which will allow us to enhance this strategy and to have the opportunity to reach these objectives. First, we have several programs, which are connected to women, for example, the inclusion program [indiscernible]. And we have a partnership with HEC School of Management, so a leadership program to help women who want to have very high position. And this is really a new program, and we'll see what happens in the future. We are also working on other points because for us, we want to work on nutrition. So we have a catering Be Well program. And this is the creation of this charter nutrition health pleasure to develop the know-how and prevents undernutrition and also to engage against food waste. So these commitments are extremely important with this charter, as said, we'll be able to double and, let's say, highlight our actions. Now as for inclusion, Again, we have a great opportunity to the index, which is the Disability Equality Index. The idea is to facilitate the participation inside the companies, the facilities. It is a pilot participation in the global index. So far for only U.S. companies. So this is indeed a great project and other ambitions, ambitious projects that we have developed together with the group in order to define within the end of 2021, a new environmental strategy, and this approach is really key. And on the basis of this environmental strategy, we'll be able to get to and to complete 2 scopes, 1 reduction target with respect to GHG emissions and to reinforce actions aimed at resolving biodiversity. So we have the chance to be selected for the corporate convention for the climate and we'll join the convention Convention des Entreprises surle Climat. So we have joined together with 150 selected companies to design new economic model, respectful of living implemented in all companies throughout 150 operational roadmap. So it is I mean, a great honor to be part of that project and to go further, to go ahead and also to build a more sustainable future. Finally, what about our work that we have done for a long time now. And as said beforehand, we have this native policy. So we are implementing this roadmap. And as has been working rather on this point, and it has been recognized in extra financial agency ratings. So here, we have the medium risks evaluation according to the fields that we are ranking 5. And we were 34th in 2019, as you see. So this is extremely important to reach that level. And we are amongst the most performing -- I mean, top 10% best-performing companies within the sector. And this is 49 points acquired. So we are actually 4th for Vigeo Eiris, as you see. So ranking 4 out of 47. So we really want to be as determined as ever for our policy, and I would like to thank you for your attention on CSR strategy. Right. Thank you. So we try -- we want really to work on sustainability as said, is so much important for renovation of certain pillars, but also the building of new site and also, the idea is continue what we have done on premiumization for the offer of the network, so internal development, real estate disposal and also international, I mean targeted acquisition in Ireland, Switzerland, Spain, mainly. So small groups, let's say, average medium groups, which are independent. And also, as said, Rio and say disposals still keeping the flagship the best ones position. And also next year we'll develop more this aim in order to organize our financing and also disposals in the future. So anyway, as you see here, we have this opportunity and also responsible and we are a responsible and engaged company. We are, I mean, an example in our field, but not only. And this is so important for our peer group to enhance sustainable development. We had -- we needed to get to this upper level, and this is what we did. So we are one of the main global groups and actors as far as the revenue is concerned, profitability. So at least for revenue, plus 7.5% at least. So we are anyway cautious on these numbers. So EUR 4.2 billion. And of course, we have great progression as well for profitability, good stabilization in July and August. And also new facilities and several changes in France. Good increase for the second half year and beginning of the third and also operators have started again their activities in September. So we are, as I said, extremely proud to see also the EBITDA margin for H2 and also EUR 100 million and EUR 300 million in order to be ended during this semester. So now we need to conclude. So we'll have a look at your questions.

So we have a few questions about COVID-19, about post-COVID. What about residual costs which may be present. So no structural costs from COVID. We had, in fact, extra costs, and that was the question during COVID-19. So we had to bring, for example, lunches in the rooms. And during the crisis, that was more difficult as well for cleaning operations. But no post-residual costs. And also, we have an increase of margin. Why? Because we -- when we have failures, we learn. And COVID-19 is the case that we have learned how to regulate better our cost and also how to work in a different way, still with the same quality, even more quality. So we have learned how to better structure our costs and our actions. And sometimes, we had increase of margins until the beginning of 2022. As for occupational rates, we had an overview which have started to -- at the end of March with an excellent May, June, July in the nursing homes through the network had -- really extremely high record. And also August has seen, let's say, a stagnation because of short stays. In September, as we are on the 22, which is I mean, continuing on that trend speeding on reeducation facilities and homes. So what we said is that we should go back to the rate -- pre-COVID rate within the end of this year, knowing that all countries are at the same level, obviously, and getting back to the situation that we had before, for example, Austria or Switzerland, which were less impacted. So we actually had transformations also of some stays in the long run. And also we need to see the global revenue, the margins and also the day rate. We said we would not modify our prices and we wanted to keep the quality of Orpea group, which is well known as quality actor. So obviously, we didn't want to change that. So we will see what happens. As for the revenues because, as I said, it's different according to the countries, according to the trends and the situation. Still on COVID-19, we hope to have, I mean, margin recuperation in -- as it was before. So we are extremely confident, as I said, about the stabilization, 2020 EBITDA margin will and should come back to its level before COVID-19. Still that EBITDA margin and our guidance to H2 corresponding of H1, so half year 1, half year 2. Yes. So we have these natural effects where the margin is higher, but let's say that we have sometimes 2 more working days, right? And also the taxes and real estate taxes are considered for the first half of the year. And then another event will make the difference this year is the additional rate, which will increase between the first and second half of the year. So the question was, are you at it, whether your consensus of analysis, which has this margin of EBITDA. Yes, we are confident on this consensus of margins. Now what about the evolution of the daily prices? And I already answered that. But even though these occupational rates in most of the countries, and Spain is a good example, and also other increases in other countries, we have not in any countries seen any decrease of price. And in Spain, once again, since the beginning of this year, the prices have even get higher 4%. So no decrease of price, clearly. Now what about real estate and the capitalization rate for our future dwellings and buildings? This is the rate, I mean the data we gave you between 4% and 5%. And so for the existing side, we have, again, a lot of gains and also with a lower rate rent sometimes. So the objective is to keep that EBITDA rate, which is the lowest and sometimes we'll be able to adjust the situation according to the situation from 10% to 15% between 4% and 5% in most of our sites. So that depends 4.2%, 4.5% and so on. Still we do you have 40% or nearly 50% of all the real estate. So if I may, it is really one of our specificity as operator because most of operators in the world asset lines do not have any line as real estate. So we wanted to have, as a group, nearly 0.5% of the -- of this range. So having good localization, good sites means that you will always be there. You will never move from this position and from this localization. So this is extremely important also to see what can be done in the future. And at the same time, we'll have, I mean, the opportunity to reimburse that after 15 years. So this gives you, of course, an added value in order to secure cash flows in the long run and also gets you to the group a capital gain, if I may say, because you create an added value and also security regardless of the crisis. And also, with the crisis that we had in 2006, 2008, I can remember what happened. And we really try to work on what happened. So I mean, that was a sort of warranty for us to enhance our strategy, regardless of the crisis, having a lower rent and this is also extremely key because regardless of the field, I mean, in all the fields, groups when they have their own real estate, get to better results, better objectives, reinforce also best share of real estate. Real estate, of course, is evoluting on field side. So you have also the opportunity to have this priority aspect as an added value and also to limit cost in that framework. So as said, it is so much important to have real estate, and we never wanted to scale our real estate range. I mean, people were asking that sometimes, but we want to keep it, obviously, of course, we could sell it, obviously. And we are -- I mean EUR 2 billion actually on the market. And you need only a few weeks to sell it, but this is not the point. I mean, when people ask, what is an obstacle to your development, this is not for sure real estate. It is probably the approach for the future to find employees, to find right mentality, to give an extra added value of qualified people, qualified staff. And this is, of course, our objective main goal to work on this opportunity and also to reinforce real estate. Real estate is just the contrary of an obstacle. It is an added value and for us, an element of capital gain. EUR 7.5 million real estate is done by independent experts as world experts, GLL, which are taking, of course, that site and apply a rate rent considering EBITDA. And then they say, okay, this is the capacity that we have here. So 50% for example, as a rent. Now another question for real estate. Why is real estate in France mainly so much important? Well, we've had an increasing interest growing before COVID-19. We had been spinning our strategy during COVID-19 just because capital rates were guaranteed, but we have no risk. So today, when you have an investor, you want to invest on logistics and health, in offices and so on. But what happened with this COVID-19 crisis? The investors who had invested their money in hotels, for example, well, the vacancy rate had exploded. So if you take the biggest hotels had 0 occupational rate for month. Well, of course, trading activities have difficulties. But here, as for offices as well with the development of smart working, you may know that, again, I mean offices all over the world is increasing as I said, as a rate. So vacancy rates. So this is key to understand where, I mean, the vacancy rate has been, once again, the lowest. So we were to 90% of occupational rates. So the capacity to pay your rent was totally global and intact. So this is key to understand why investors consider in that typology of assets really a solution and also the transnational, international, global aspect, going beyond borders, Europe, America, but also having this great opportunity to have resilience in assets. So resilience connected to the trend that we have in our market and according to the population. So what about the building costs and the increase of those costs connected to raw material absence or lack of raw materials, not really delays actually. That would depend according to the countries. We have punctual increases. And we think that we have extra increases. We'll see what can be done on these strategies because we are building our own sites. There are no special costs for promotion. And on these increases, we have also the opportunity to keep the same strategy. So no global impact on these increases of building site costs. We had another question about the development. I mean the weight of development of EBITDA on the rates that we have seen. So we have certain sites, which are being empowered, which means the first year when you open, you're not, of course, full of people. So you have several charges, extra charges. So this is a weight that you have on half year, first part of half year, EUR 126 million of revenues generated by these reopenings or restructuring, loss of EBITDA of EUR 1 million, which is extremely important as well. So EBITDA of minus EUR 20 million. This means that today, if you have the margin I mean outside the COVID cost, now you have the margin of EBITDA, which is around 28.45%. Another question about the tax cost. How do you consider the evolution of taxes during the first semester 2021 is 20% as compared to 28% in the first semester of '21. And Sebastien explained it well because of the decrease of CDAA and also the empowerment of international business development. Well, we can see extrapolate that this rate of 23%, which can be developed on the whole year. Then another question. The costs that we had on second semester 2021. So first semester EUR 33 million. These costs should continue to decrease during the second semester and not ready to 0% because we have a lot of effect on certain countries and that should decrease compared to the first semester. Then another question about the evolution of margin. On France, Benelux area for first semester. So what is the perspective that we have on this margin? So the reason which explains the decrease of the margin. First, simple. It is connected to the nursing homes in Belgium and France. And it is a question of comparison. During the first half year 2020, we had extremely high levels of occupational rates 75%, and we were extremely optimistic for the second part of the year. So still for nursing homes, well, of course, it can depend on the situation, but we started at the end of March than April and May. So for the first half year 2020 for nursing homes, we had an occupational rate average, which is still the same. And this is the contrary for the second part. So we are around the same rate. And as I said beforehand, vaccination effect. Well, we had a restart. We start from a very low point. And we thought April, May, June. And this is the reason why this is the basis of comparison that we have inside nursing homes. So we are extremely confident, as said, especially for Belgium and France to come back to EBITDA level, mainly in France at the end of this year. And this corresponds to the pre-COVID period of time. Other question is about the stock exchange and what happens if we want to foresee programs to have specifically on that. So no specific program. We had a lot of plans and actions for new sites, but also acquisitions. A few questions then on the global policy, so CSR policy. Do you have a turnover specific ones? So we try to have objectives, clear objectives on which we have leverages so turnovers. And we do use them as training, internal promotion and turnover is also an external actor as for difficulties of recruitment in certain areas, in certain businesses or as said, we had certain kind situation in the past. So during February to June, the recruitment of nurses was more difficult in France just because nurses were modernized for the vaccination compliance and also with the national campaign, I mean, it's with rates which were extremely high, represented twice to 3x their wages. So of course, you have an effect there. So you have external effects on this turnover. Now also another question on CSR. Do we have authorities which will impose new environmental constraints? No is the answer, but this is not the point because our willingness to have sites, which are corresponding to the highest environmental standards to have green buildings, to have very clear objective to reduce carbon emissions and so on and to have all these certifications that we have is not because of authorities which put constraints. It's just the opportunity to stick to our willingness coming from the group. And it is an inner recommendation, if I may say, which represents the opportunity from the group as a willingness to implement this policy, this strategy and also to have a return on these investments. So we know that all the prices of electricity or gas. And for example, in certain countries, as in Italy, we have I mean, prices are doubled for energy. So it's obvious that we'll have an increase on that. And that will be more and more profitable and will make more spending as well. So I think this is really key. And the last 3 questions, why don't we invest in Alzheimer diseases and specific centers dedicated to that? Well, it is our core business. And I mean we had several opportunities which we're extremely well known in the world to have developed therapies which were not medical ones. And this is, of course, extremely importing because for Alzheimer's, we have 20% to 30% of the whole degenerative diseases for this development. So that is extremely important to see also for real estate for going forward as well. So dedicated to neurodegenerative patients. So yes, please for the person who asked this question, do not hesitate to contact us directly and to ask your questions, to come and visit our sites to see what we can do and see -- I mean, on our facilities, what are our programs. Then another question for China. We opened this facility in China, which is extremely luxurious one. So we had a second project in Shanghai in progress. We are not investing there. As I said, we are extremely careful with China. It will become one of the biggest market in the future. Anyway, also for China, we need to go there. We have teams which was there, and it's not possible in this precise moment to travel and to stay there. It's closed. Borders are closed in China. So we had, I mean, lockdowns, which prevented -- I mean, which prevent us from getting there. So -- prevent us and anyone from getting there. So we'll see the developments and the changes in the future. As for China, it is extremely complex situation there. And we know that a lot of groups went back from China even after positive results. So we'll see what happens. We need to take time and also for sustainability in the future there and results of delivering on -- results mainly. Now what about the evolution of our employees? Now in Western Europe, as said, the medical health care part, so nurses are taken into consideration. We had an increase in salaries and wages in France. And that's, of course, taking part of the welfare price state, but we do not see inflation of salaries in that since this is a result of our human resources policy, which is, I mean, focusing on internal promotion and internal career development. And lastly, why don't you create dedicated vehicle where you would have investors I mean, joining? Well, we didn't use it in the past because we created that at a precise moment when the situation changed. So we did not develop that aspect, but we'll come back to this point from March, I mean which kind of vehicle that we want to develop and keep between 45% and 55%. Maybe consuming less capital, we'll see that during the end of March. Right. So having said that, I think we have answered most of the questions there. If you have further ones, do not hesitate. Thank you for your attention, and see you soon, in-person. We'll be very happy to meet you in-person because it's now nearly 1 year. We have not seen each other. And really, we are looking forward to having this new opportunity again. So see you soon. Thank you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]