DO & CO Aktiengesellschaft (DOC) Q3 FY2026 Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to the conference call on the financial results of the first 3 quarters of the business year 2025, 2026. I am Sandra, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] At this time, it is my pleasure to hand over to Attila Dogudan, CEO. Please go ahead, sir.

Thank you very much. Ladies and gentlemen, good afternoon, and good morning to the U.S. This is Attila Dogudan. I'm together with Johannes, with both Johannes in Istanbul and Bettina and Attila Jr. are joining from Vienna. This time, we are very happy to share our Q3 results, and we'll be then ready for the Q&A, as always, once Johannes is finished. We had, again, great 9 months, the best ever result in the history of the company. As you have already seen, I guess, revenues have increased, which you see then on Page 3 in the presentation, by 5% up to EUR 1.236 million in total revenues. If you look at the revenue increase at constant currencies, it's 18%. This is the first time we report this as well to have a good comparison for you without the FX up and down, so to say. The EBITDA of EUR 227.7 million means an increase of 15% or 16% and the EBIT of EUR 163 million means 17% increase. Net result then is with EUR 84 million, an increase of 16%. Even more important are the margins, but we're going to come back then in a minute to this. You see in the 3 divisions, the Airline Catering with EUR 1.4 billion is a 6% increase, International Event EUR 274 million, 1%, and Restaurant and Lounges 8%. But if you look on the results, EBITDA and EBIT, it's far better, obviously, as you see. So we always overperformed the increase in sales with the results of EBITDA and EBIT. You will see that in a minute, I will come back in a minute then in detail in all areas. Let's go to the highlights, so to say. The free cash flow of EUR 182 million in comparison to EUR 91 million last year and the net debt ratio of 0.2 makes us really, really very happy. Equity ratio of 41% is another part, which really works well for us in comparison to 32% in the previous years. We have the 3 divisions where I go back in a minute, but I think it shows that as a team, we, in majority are doing the right things and even more important, keeping our promises to you, showing that our strategy of being financially very healthy and then invest in education and growth is basically the base of what we will achieve for the future. We are now at Stage 2, means education and strong growth is on the map, so to say. And by keeping our innovation and quality level, we believe that we will be able to scale the business now and the right speed we always wanted. You might have seen in our press release that we have announced today to commit to 7 new gourmet kitchens, 12 Demel cafe houses, 12 Henry retail, and 3 Do & Co restaurants. Furthermore, we expect growth in the segment of lounges and will go to all major airport tenders where we have a location anyway, wherever there is a chance to go our airport gastronomy, as I think we are now in the situation of being able to scale this in many other locations as well. So if we go first to the Airline Catering, after -- I think the key, which is always the driver of the success of this company is innovation, quality. And I think the most important, obviously, is always the people who are the real asset of the DO & CO, and they make the culture and the differentiation in comparison to the rest of the market. In Airline Catering, the EUR 1.45 million means a 6% increase in constant currency, even 22%. EBITDA increased by 16% and EBIT by 19%. There is -- we can go through all areas as we are in Turkiye now. This is an incredible great market. Turkish Airlines is doing very well. We have today the announcement or even a press flight of the 500 aircraft of Turkish Airlines and Airbus 350, where we had a 3-hour flight with journalists, and what was announced again to double this fleet of more than 500 aircraft to close to 1,000 aircraft. So you see an incredible market, not only Turkish Airlines, all the other market participants, not in the scale like Turkish, but are increasing the capacities, which means for us on this market, very good opportunities to grow with our partner, Turkish Airlines. But as I said, even with third-party clients, we will head up to an incredible kitchen here. As you might know, the foundation is done of the new building, which will be the biggest kitchen of the world with 150,000 square meters and will be in operation in hopefully, latest 2 years and then go up to 500,000 meals. So this is a kind of doubling the capacity of today, and we are very proud to be part of this process. The second biggest market or the second biggest area, so to say, is British Airways Iberia with IAG Group. So both of them are doing very well in both locations. So we have very good relationships. And I think -- I hope and we see on the NPS scores that we deliver a product which is appreciated by our clients, and at the same time, the clients of the clients of the passengers. This is basically always the most important thing. So Iberia has won, again, the ambassador of Spanish gastronomy and British Airways is very much focusing on quality increases as well. Delta Airlines, we had trouble when we started, but it's already stabilized now in all areas. So at least we are in a regular business, which does not burn any money. So we're starting to make money out of that, which means on the U.S. market, we step increase and we'll do better. The other U.S. carrier we have, we are very proud of is JetBlue. So JetBlue does an incredible job, especially with Mint Class, where we have them on the main JFK airport. So when you land in JFK, you see a lot of DO & CO trucks. I think we have a great market share there, which is one of the busiest airports of the world. Furthermore, in Airline Catering, you have on Page 13, a lot of new clients. So we've got a lot of new clients. The ratio of winning contracts is more than 60% of all the tenders. And if we do not win is the majority that we are not willing to deliver a product, which is maybe not covering our cost only for the sake of market share, it doesn't make sense. So we will not follow this kind of strategy as some of our competitors do. So we see that there is enough growth on the organic side for us and get enough opportunities to get all these clients. So if you look at the list, Air Canada, All Nippon, Cathay, Etihad, EVA Air and so on, all of them are major airlines delivering a great product. Coming to the second division of International Events, EUR 274 million is a small increase of only 1%, which is basically caused by the non-event of euro in this year. So last year, we had the euro in comparison to now. And if this would be the same size, then the growth would be 13%. So in real business, we grew, but as this event happens every 4 year, we have every 4 years the same problem the year after, so to say, in terms of growth. Nevertheless, the EBITDA with plus 9% to EUR 35 million and 5% to EUR 28 million on the EBIT side shows that we do our homework. I would say we are proud of all the clients we have in this segment, not only this segment in all the segments, but Formula 1 is the one where we have the tightest relationship, so to say, where season #34 is going to happen now. So we started last week in Barcelona and this week with Bahrain this week and next week with the test, and then we'll go to Australia and then to China. And this season will end just beginning of December again. So as you know, Formula 1 is now the benchmark of this industry, not only in demand, we have incredible pre-bookings for all the season, and I would say, almost all locations. It's very much appreciated what kind of level Formula 1 delivers in total experience, and you might have seen a lot of comments where money is shifting to hospitality and this kind of guest experiences. So people really like to go to premium events. I think we cover a few of them, as you know, and Formula 1 is obviously one of the best. Allianz Arena, by Munich a long story, which is a very close relationship too. So it works super well in public and in the VIP areas. Olympiapark, which is under construction now for, I think, 1 year is SAP Garden. Additionally, where we have basketball and ice hockey. So we have every week, I would say, an average 2 to 3 events. So it's fully utilized stadium, which for us, regardless of what's happening is always additional business. In Tennis, we are proud of the Tennis Masters in Madrid, which is, I would say, after the Grand Slam, the most successful tournament, especially in hospitality, I think half of the stadium is already hospitality. So people go to these kind of events as a social event, and they really appreciate. The next on the line on what you read is FIFA World Cup, which we did in Miami and New York is a pre-World Cup. So I guess one of your questions is what's happening with the World Cup. So we thought it's done. But now we are sort of partially back in the game. So I cannot give you a clear statement, but it's not over, and we will know it in the next 2 to 3 weeks if we do something and which part we can do in this kind of business. So it's a little bit weird because it's only 3 months to go, exactly 121 days, I think it was yesterday. But when we did Qatar, it was 100 days before the first match where we were -- we have been awarded. So we do not expect to get all of it, obviously, which does not make sense, but we might get a good portion of it with the important games and the important locations, but we'll come back to you as soon as we know something. The rest is business as regular in this division. Coming to the restaurant business, plus 8%, EBITDA of 21% and EBIT of 30 shows that what we have promised you, I think, 2 or 3 years ago that we're going to focus in this division. And once we know the good recipe, how we're going to run it, then we will expand. This is the reason why we are now at the position to expand the retail, to expand restaurant business and to expand all the lounge businesses. We believe we are now settled with the right setup with the right people, which we ongoing will invest in the Do & Co Academy, which we shared with you last time. But we believe there is an incredible opportunity, and this is a B2C business which is driven by us. And if you look to the margins, then I think it's a very interesting part, which was always the small baby in the group, and we believe very much that it will grow strongly. Demel is a success story since COVID, to be honest, when we started with the Kaiserschmarrn, which is the Austrian pancake, everyone was just a little bit kind of oh, this is nice. But now we have really strong, not only demand, we have incredible frequencies through this product that all the other areas from the coffee shop to anything which is retail, which is merchandising is really, really booming. The restaurants in Vienna and in Munich, same, nothing special. We will go in some refurbishment, especially in Vienna because it's 17 years old, and we believe the benchmark, we need to have a kind of flagship store and benchmark for the whole group in this one we have. Hotels doing well, very profitable. We are very happy to go to [ Munich star ] and belonging to one of the best in Munich. Airport gastronomy, the same. We just won a tender in Vienna with a big den location, further Henry's and the big bar. So this business, I think, really makes sense now from now on to invest and to go to the next level. Finally, in a nutshell, I would say that we are very happy with the steps we did, and we believe this is the best way to sustainably grow this company and develop this company. I can assure you that we are now on full gas, so to say, in this game again and will, as one team, put all of our power to realize all the targets we're sharing with you. And I can promise you on the macro level, so to say, that we are heading the double-digit EBIT in the next 2, 3 years and targeting the EUR 3 billion. If you see the organic growth combined with what we have announced today, we still, I would say, the target of EUR 3 billion is very reachable in a decent period. FX rates always can interrupt or influence for a period something, but not the business case at all. And that's the reason why we decided to report constant revenues as well from now on. So you have a better comparison of real life, so to say. I have to say a big thank you to you for your patience in the last months and maybe 1, 2 years when we said we don't want to go stupidly and burn money just for the sake of growth. I hope you appreciate that the strategy of going step by step, first of all, becoming financially super solid and consolidate after COVID, and then invest in people, which we will do constantly, and then going strong growth, I think, really makes sense. And now we are at a step 2 or 3, so to say, together. So this is in a nutshell before I hand over to Johannes. Thank you very much for listening, and we're then ready for your Q&A. Thank you.

Thank you. Good afternoon, good morning also from my side. Thank you for joining us today. Before we go into our financials in more detail, let me first summarize our key messages for the first 3 quarters of '25, '26. First of all, our organic growth is double digit across all divisions, as we've already mentioned, even when we exclude inflation effects in Turkey. Second, we have once again improved our margins in all our divisions. I would like to -- particularly like to highlight here the net result growth of 15% and our cash flow performance clearly shows that our earnings translate into cash. This underlines the high quality of our results. In addition, we have further strengthened our balance sheet. And finally, I think we have built our strong financial foundation for future growth, a message that we also clearly communicated in our press release. Let us start with our income statement on Page #27. In the first 9 months, revenue increased by 18.3% at constant currency compared to 5.2% reported. I think this clearly reflects the underlying operational momentum across our business, while reported figures were impacted by FX movements. More importantly, the quality of earnings has improved. EBITDA margin increased to 12.2%, EBIT margin from 7.9% to 8.7% and net result margin from 4.1% to 4.5%. This margin development is the result of disciplined pricing, operational efficiency measures, strict cost management and a consistent focus on profitable growth rather than volume at any cost. On next slide, I would like to highlight as well the return on capital employed of 39.8%, which highlights the capital efficiency and scalability of our business model. Looking at the third quarter, specifically on Page #28, we continued the positive trend. Revenue reached EUR 630 million, while slightly below prior year numbers on a reported basis due to FX translation, our organic growth remained strong at 15.9%. This underlines the demand in our core markets remains strong and robust, and our growth remains clearly in the mid-10s. As you can see on the chart, in the prior year, Q3 benefited from positive currency effects, meaning reported growth was higher than organic growth. This year, the situation reversed. And again, margins in Q3 improved further compared to Q1 and Q2, to EBITDA at 12.4%, EBIT margin at 8.9% on a record level. Net result margin improved to 4.9%. And the bottom of the slide, we want to show you our FX development for the first 3 quarters. And as you can see, Turkish lira is down by 19%, British pound by 3% and the U.S. dollar by 7% compared to minus 6%, plus 2% and 0 last year. So turning to our divisions on Slide #29. We see margin expansion across all 3 segments, which is particularly again, important from a structural and strategic perspective. So this is a clear sign of operating leverage is now fully visible on our P&L. Gourmet Catering improved from 7.4% to 8.3% on an EBIT level, the International Event Catering from 9.9% to 10.2%. And we made a big jump also in our last division, Restaurant, Lounge & Hotels from 8.4% to 10.2%. On Page 30, I would like to start with our balance sheet. So I think the most important message on our balance sheet is very clear. We have strengthened again our balance sheet and further reduced leverage during the first 9 months. Total assets increased slightly to EUR 1.26 billion, mainly reflecting the strong increase in cash, which rose to EUR 267 million, up by more than 50%. This increase was partly offset by lower trade receivables, driven by payments received from Turkey, U.K., and U.S. and good working capital management as well as its related reductions in PPE within the right-of-use assets. If we move on to the Page #31, I would like to draw your attention to the equity side first. Shareholders' equity increased significantly to over EUR 500 million, reflecting strong earnings generation. And as a result of this, the equity ratio is at 41.5%. At the same time, we continue to actively reduce financial liabilities. So our financial liabilities decreased, mainly driven by these liability reductions and also loan repayments. As communicated previously, we will repay the remaining bank loans of approximately EUR 65.8 million in the upcoming periods, of which EUR 56 million will be paid in Q4 now. Let me walk through our cash flow statement on Page #33. So first, we increased our gross cash flow from operating activities to EUR 199.6 million, representing a 47.7% increase year-over-year. This strong performance was driven by a higher gross cash flow of EUR 220 million and a significant improvement in working capital in that period. So last year, working capital had a negative impact of EUR 27 million. This year contributed positively with EUR 17 million. Again, it clearly demonstrates that we are not only growing earnings, but also converting growth into cash at a very high rate. Second, our free cash flow increased to EUR 182.9 million, almost doubling year-over-year. I think this also clearly underlines the strong cash conversion of our business model. Free cash flow after IFRS 16 payments is up by 140% to EUR 147 million. In our last call, we communicated that CapEx will be at around 3% to 4% of revenue this year. So as you can see, year-to-date, CapEx stands at EUR 43 million, full year CapEx will reach approximately EUR 50 million to EUR 60 million, which is a bit lower than expected. And for next year, we forecast around EUR 100 million of investments. So despite investments and repayments, we increased our cash position by EUR 108 million. I think again, our cash flow statement also highlights as well the quality of our business model. Let's move on to the last page, #33. The net debt-to-EBITDA ratio has decreased to 0.2. This effectively brings us very close to a net debt-free position. Importantly, this is not a temporary fluctuation, but the result of sustained earnings growth combined with strong cash conversion and disciplined capital allocation. Finally, as confirmed in our KPIs as return of capital employed or equity ratio, our results clearly show that our financial strategy is effective. Our organic growth remains strong. We are more profitable and our margin expansion is structural and sustainable. I think this provides a strong financial foundation for continued growth and value creation. So thank you for your attention. I will now hand over to Attila again, and then we look forward to answering your questions afterwards. Thank you.

So thank you very much. Now happy to your Q&A.

[Operator Instructions] We have the first question from Julien Richer from Kepler.

Three ones for me, if I may. The first one, if we can have a little bit more details on what happened with the World Cup contract? What has changed for this new discussion with them? And if you think this might be the next step for maybe accelerating the penetration into the stadium market in the U.S. So that's the first one. Second one, in the Event Catering division, the growth, excluding FX is double digit. Do you think that this will continue into 2026? And if you can detail a bit where this growth is coming from, if it's volume, if it's prices. So more details will be appreciated. Last one on the EBIT margin. So it has been up 20 basis points. Over the 9-month period, it's well above what you initially expected for the full year. So what is your view for EBIT margin for this year? And where is this improvement coming from, especially when you look to cost of materials in the 9-month period, it has been slightly down. What's the reason for that? And how do you see EBIT margin evolving also for next year?

So thank you, Julien. Maybe I'll start and then Johannes will continue. On the World Cup, as you know, we have this reported a few times, and it was a tender process, which took 1.5 years. And as you know, FIFA is not doing it on its own. So there is an agency doing it. They bought the rights of the hospitality. So it looks -- we never got an answer, but we never got a no and we never got a yes, leave it on that, this is in this industry, something which happens. It's not like a big surprise. But we thought that we will say this time this is done, and we're sorry, and it did not happen. But just a week ago, we received a call saying, are you interesting or can you still do some locations with a decent volume on a double-digit million, but on the lower end of it, obviously, but in prime locations. So we gave, I think, 2 days ago, 3 days ago, we looked and then submitted an offer where we said, if this and this and this happens, then we might jump in it as we have, as you know, existing equipment and everything on the U.S. side and Mexico. So these are the locations where we have some infrastructure. We have some people, so to say, and we are used to have the Formula 1. And I guess in the next 2, 3 weeks, it sounds weird, but this is, I would say, is the time frame. We'll get an answer if this works or does not work. So I cannot promise you it's going to work. If you ask me today, it's more than 50%. If you ask me what is the size of the business is something 25%, 30%, 35%, something like this for 1 month. So depending, this is the scope, which is possible to happen. On the event side growth, what we see is a high demand in regardless what kind of premium event we do. And if you look to Formula 1, if you look to Champions League, prices and it's a volume issue. For us, it's less price than volume. But for the organizers, it's price, so they can increase the price now. And we have been asked to go on a different level of experience, guest experience to make the experience like unique. You can talk about Instagram or whatever you want. So to have a clear answer from our side, we expect higher volumes with some price adjustment, but it's not like doubling. But we see it everywhere that the demand is significantly increasing. So I don't know if someone of you have seen -- there was an article, an economist, I think, saying from the luxury, it goes to this kind of hospitality, and I've been at the World Cup, I've been at the Champions League final, I've been in [ Wimbledon ], I've been here and there. So people take care of this kind of business. And I think we will benefit out of that because there are not so many companies around the world being able to do this. So we will have a double-digit growth in revenue next year. That's what we think is realistic. On the EBIT side, maybe Johannes give the right answers?

Yes. So regarding the EBIT margin for this year, Julien, you know that our guidance was 8.0, between 8.0% and 8.5%. So to be honest, after 8.7% now for the first 9 months, we are on the upper end. So hopefully, we can also surprise you at the end of this business year. Regarding to the costs, you're right. So material costs are down. I think last year, we had 42.3%, 40.1% this year. Please consider that also agency stuff is included in that line. And we had start-up costs in [ GFC ] last year. That's for sure also has one impact on that. And the other thing is, of course, operational leverage, cost efficiency for material costs and the same for OpEx, OpEx are down from 14.5% last year to 14.1% this year. That's purely driven by operational leverage.

Julien, maybe one more sentence to add. Maybe you guys all underestimated the impact of COVID, not only in terms of revenue, but in terms of hit in the organization. So it took a while until the engine comes back to the regular speed, which is now happening. So we will definitely improve our efficiency in all areas. We'll do better procurement. We'll do better products with less cost. So as we are on track again, and we feel confident with the financial situation we have as a company, we have the power to improve on one hand, our cost management. And on the other side, we are happy to invest and can invest and we'll grow the business. So it's a dual effect.

Julien, sorry, one answer, which I forgot. So regarding the guidance for next year, the EBIT margin guidance, was 8% to 8.5% this year and then for next year, 8.5% plus. So we're again confident with that number. Although we are now opening a few units in stores, this is still not changing our guidance for the next years on the margin.

The next question comes from Vladimira Urbankova from Erste Group Bank.

Maybe I would like to a little bit elaborate on the latest issues with the guidance. So if I understand correctly, for this year, EBIT margin guidance is above 3.5%, maybe heading 8.5%, maybe heading towards 8.7%, which we have seen in the first 9 months. But on the top line, I think we will have some ForEx headwinds. Maybe if you could elaborate on those ForEx headwinds anticipated for the fourth quarter, respectively, for the full year '25, '26 for your top line? Then my next question would be related to this announcement about 7 new Gourmet Kitchen, 12 new Demel, 12 Henry, 3 new restaurants. What is the time frame for this? What is the investment volume, which territories you plan to strengthen your presence or possibly enter maybe some new markets. So a little bit more on this plan.

Thank you. Let me start with our guidance. So top line, our guidance, yes, we have to adapt slightly due to FX to 2.4 -- between 2.4% and 2.45%. And on the margin side, you're right. So it's 8.5% plus. Maybe please give us some room to surprise you at the end of this business year. But that's now our current status. I think in absolute numbers, we are still in line with our guidance for the EBIT and also for the net results. And then for next year, I think which is important for you, if you look back, for example, in the last 10 years, the difference between our reported currency growth rate and constant currency growth rate was always between 5% and 12%. Now it's 13 points, which is quite high. But I think you have clearly seen now the devaluation in dollar and the pound. But normally, the difference should be at around 5% to 6%. So if we grow organically by 15%, 15% to 20%, this should be 5% to 10% on a reported level. I hope this helps again for your guidance and for your model for the next years.

Vladimira, maybe you asked the regions and locations. So I would say it's 1/3 is U.S. 1/3 is Europe or maybe U.S. is a little bit more, and we will go first time to Middle East, including kitchens for airlines. So we plan to have 3 to 4 kitchens in the U.S., 3 of them most likely in Europe, 2 for sure already, but not so sure that I can tell you where we have to sign it and 2 in Middle East, which will come up, I would say, in the next 3, 4 months as an announcement, hopefully. So we are in a final stage there. And we believe very much that in all the other areas of the retail, we have the same split, so to say, as we can take the risk on the bracket, so to say. Restaurant-wise, we'll have the first restaurant next year in London. We are ready to sign 2 and then the one is coming to New York. So all what we are talking is -- it's just a 3 to 4 years plan. And as you know, we are always conservative. This is what we have kind of for sure, so to say, and then see what additionally we can do or not. We feel confident to scale these kind of things, which we stopped for the last 2 years, as I've mentioned, the reasons why. So this is the split of the region. So we will first time be in Middle East and grow our U.S. business. There is no here as a big story. Maybe we -- do something we can do, but we combine always all the businesses and for that, it makes sense like we do it now.

The next question comes from Simon Keller from NuWays.

First of all, thanks for the FX insights you already provided. They were helpful. Still one FX question from me. In Q3, the FX moves have impacted reported revenues more strongly than typically. Now clearly, FX volatility plays a role with that also the comparable base and IAS 29. But was there anything in the commercial setup that increased the sensitivity this quarter, for example, repricing cadence or a timing lag? And also as a more fundamental follow-up for me, also mostly targeting Turkey and the lira, how are your major airline contracts priced? Is it inflation-based or lira-based with periodic repricing or something completely different?

Thank you. So yes, if you look at Q3 numbers, you can see that last year, the reported currency growth rate was higher than the constant currency growth rate. That was purely driven by the effect that in last year Q3, the lira was appreciating by 3%. And please consider due to IAS 29 hyperinflation accounting, we do not take the average FX rate of the lira. We always take a fixed cutoff date, which means that, for example, after Q3, if the lira is going up, we have to do the exercise for Q1 and Q2 as well. And that's why you see a big impact last year, which was approximately 9, 8 basis points higher on a reported level than on a constant level. Normally, as I mentioned before, the difference between constant and reported growth rate is always around 5%. That's what we saw also last year. So for last year, again, on Page #28, the difference between reported and constant currency rate was 4 percentage points. Regarding Turkish lira, so in Turkey, we have part of our business is there on a cost-plus model. So we are in a position to move on any cost increases immediately. And then for the third-party clients, of course, we have our CPI and price adjustments like in all other contracts. So I think the main message is, yes, FX impacted our top line, but not our bottom line. I think that's the most important one for you, and we proved that now for a lot of quarters. So I think that's the main message here.

Maybe let me add on the Turkey side. So with Turkish Airlines, we have obviously a budget, which we have to fulfill and which we monitor every month jointly, which really makes sense. So as we get Turkish lira paid, but the expenses in Turkish lira too is a natural hedge in the same currency. So it just at the end of the year, when you turn it in your consolidated balance sheet into euros, then whatever the FX effects is the FX effect. But it doesn't affect the margin. With third-party clients, well, all the international clients, we have dollar and euro contracts. So over there is more safe, so to say. And this is a business which grows significantly too.

The next question comes from Miro Zuzak from JMS.

Can you hear me?

Yes.

Two questions from my side. The first one on Turkey. You mentioned that you -- with the new kitchen, you can go from 230,000 to roughly 500,000 meals per day. What's in the -- like from the budget from Turkish Airlines, what's the time frame that you need to get there? How many years? In how many years will the 500,000 meals be served?

The current -- I mean, it depends obviously on the number of aircraft Turkish Airlines buys. But as far as we know, and I think this is a public information, Turkish Airlines will double the fleet within the next 10 years. So it's a step by step. So it's...

The second question relates to the announcement you've made with the additional kitchens that you're going to build. Without any further kitchens, I mean, it's a hypothetical question, but without any further kitchens, what's the revenues that you could generate today? And with the new kitchen, how much capacity for future revenues are you building?

I think from our side, the utilization is like in the 70s or something like this. So we can have another 1/3 additional revenue within the same infrastructure, which does not mean that we don't have any CapEx, but reasonable local CapEx, so to say. So this is where we are. It's not every location the same. I'm saying it as an average. There are some which are 85 and some maybe 69.

Okay. And if you build the 7 kitchen, what's the revenue capacity of the entire group afterwards, roughly speaking, EUR 4 billion?

Yes, maybe added to EUR 4 billion. So I think our forecast is between EUR 3.6 billion plus because what can you expect from a kitchen? I think Miami is a good example. I would assume now maybe in the EUR 10 billion and then increasing the kitchen to EUR 40 million, EUR 50 million is reasonable. And if you now consider that we're opening a kitchen or 2 kitchens every year, then I think you will come up with that number approximately.

Yes. But to be honest, I think your EUR 4 billion is the right estimation -- it's not that wrong. I mean we are EUR 1.8 billion now. It exactly -- this is the number which will happen.

[Operator Instructions] The next question comes from Christoph Greulich from Berenberg.

It's three from my side, please, and I will take them one by one, if that's okay. I would initially come back to the expansion plan. And I was just wondering what time plan you have in mind for those expansion projects? What's the phasing of the openings of the new locations? And also, what is the CapEx ticket associated to them? And I was also wondering if you already had pre-discussions with potential airline customers that gives you, let's say, a good sense of the demand that you would meet them at these new locations? And then also if you anticipate any negative margin impact from the openings, we have seen that with some other larger new contracts that in the beginning, there are some ramp-up costs or start-up costs. I'm just wondering if we have to anticipate anything there in the coming years?

Yes. Let me just start and then Johannes, I think, will continue. The announcement what we did today is only for the next 3, 4 years, more 3 than 4, which we believe is super realistic. I mean you're asking customers and who requesting what we would not go to a location if we don't believe that we're going to get clients. So we have everywhere a potential, which we believe we can get. So we have a portfolio of 60 airlines. And the majority of this expansion is based on a multi-line deal, so to say, on locations where airlines ask us to go there. And if you open a kitchen, then we're going to come to you. So this is the one part. The other part is on -- obviously, if you open a kitchen, you have some start-up costs, but believe me, we will never hopefully never have -- can experience again what happened in New York. So we had a big running out of that. And this was an extra big animal, to be honest. If you do in JFK Delta with 250 flights is almost you take over, I don't know, no need for something like that. And what we are having here is more a solid how should I say, reasonable, manageable and scalable business, which makes sense. And if we go somewhere, if you have the chance to go in a home base, then definitely, our contracts will be in a way that we will not burn the money which we did in New York. Maybe Johannes, you will add something.

Yes. So from my side, Christoph, I think for a kitchen, you can expect, I would assume an average of 15 -- maybe EUR 15 million to EUR 20 million CapEx per kitchen. On the Henry payment side, the CapEx is, to be honest, not a big number. For the restaurants, maybe slightly above. So I think, for example, if you open 2 kitchens, payments 3 a year, I would assume it's approximately EUR 50 million. So maybe 50% of our CapEx guidance at the moment, which is EUR 100 million from the revenue perspective, I think you can expect maybe EUR 50 million for all these projects in year #1 and another EUR 50 million adding up to EUR 100 million for the next year, then maybe EUR 200 million in year 3. So yes, we have a clear plan for that. But from the CapEx side, I would assume it's EUR 50 million a year if we open that in the next 3 or 4 years. So it's not a big number, to be honest, because we know that Miami was a bit more expensive, but I think we learned a lot and we have a system now in place to need lower CapEx for a kitchen. And regarding the margin impact, sorry. So I think it's now the level that we have easier for us to absorb start-up costs. So that's why we do not change our guidance on the margins, to be honest. So on one side, we want to improve them, and we are able to also absorb some start-up costs. I hope this was helpful.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Attila Dogudan for any closing remarks.

So ladies and gentlemen, thank you very much. I hope the first 9 months was okay for you, and you like the way how we proceed. And basically, what we did always is have an open communication with you. And I think if there is something, hopefully, you think which fits to us is that we always tell you what it is. And we went this step-by-step strategy in full perspective of growing the company without losing margin, without losing quality and reputation. This is one of the assets and culture. So we feel very confident now that we can give, as I mentioned, full gas now still in a proper way. And as far as we see, no surprises for the year-end. And the forecast looks from our side, very good in all the pre-bookings and all indicators, as I mentioned, regarding hospitality, all the flights are full. So we -- currently, we have to knock on wood. It looks very good, to be honest, as good as never before. But we're always humble and feet on ground and are always well prepared if something happens on the world. So I hope this is what we can continue. Thank you much for listening and hope to see you soon. Thank you very much.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Thank you very much.