Séché Environnement SA (SCHP) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Thank you for being here with us for this Investor Day. I would also like to welcome those who have joined us through the Internet broadcast. Before handing over to Maxime Seche, I wanted to briefly remind you of the reasons that have led us to disclose new financial and extra financial objectives today. In 2021, we were here with you to present the financial outlook to 2025. We were setting a contributive revenue objective of EUR 1 billion for 2025. We had an EBITDA go up with gross margin between 24% and 25% of contributive revenue on the 2021 scope. We had also committed to maintaining strict financial discipline with stringent goals in terms of liquidity and financial flexibility. Well, we have to say that we have achieved some of these objectives ahead of schedule after several years of strong growth. We will be close, in fact extremely close, to EUR 1 billion in revenues in 2023. We have consistently over the period from 2021 to 2023 met our financial targets. Regarding operating margin, the operating margin already stood at over 23% in 2022 on the base of 2021 scope, including almost 25% in France. Our policy in terms of operating performance and cost control has therefore set us on a strong footing to achieve this footing -- to achieve this goal on the historic scope. In particular, over the past 2 years, we have pursued an active acquisition policy that has enabled us to enter new strategic markets, such as the industrial water cycle, which is at the very heart of sustainable development and environmental transition issues. We have strengthened our presence internationally, in particular, in Italy, in Southern Africa and Latin America. And thus, we have been able to integrate close to EUR 200 million of revenue into our scope, therefore, offering the group new prospects for growth and profitability. This external growth changes the approach to performance based on our historical scope. And therefore, we felt it was essential that we should set ourselves new goals in terms of growth, profitability, financial flexibility in the medium term. And finally, as a player of the environmental transition, we have in recent years set up a strategic management approach, partly based on extra financial performance. These extra financial management tools guide actions and measure our industrial performance for each of our sites. And environmental transition challenges, for example, decarbonization, are shared with our clients. At a time when we have to step up our environmental transition, we have to set an example in order to serve our ambition for operating performance. New extra financial targets extended to water, and energy in particular, are going to be presented today. And without further ado, I will hand over to Maxime Seche, our CEO, who is raring to go and who will be running this half day presentation.

Thank you very much. Good morning, everybody. I'm very happy to see you here today. So we've built an agenda with the main managers of the group to explain to you our industrial project. In the first part, we will be presenting the various drivers of our growth and our environmental strategy at group level and to serve our clients, we will also be looking at the commercial strategy in terms of growth and integration. We will see how we will be stepping up our growth on new markets with 2 growth areas, number one, by extending our offering to the circular economy; and secondly, through a geographical broadening using our existing base. In the second part, after a 15-minute coffee break, we will be focusing on R&D as a growth driver, and then we will present our operating excellence plan and our financial trajectory to 2026. After all the presentations, there will be a question-and-answer session. And if you're following us online, you can send your questions to Manuel Andersen, whose address you will find displayed on the screen. So to continue, building an offer to respond to today and tomorrow's challenges in terms of environmental transition, decarbonization and preservation of biodiversity. This Investor Day gives us an opportunity to share with you our industrial plans, our trajectory and our vision. We are a family company with a long-term vision and strong values. This has enabled to us to develop a strong model with strong visibility. It's a strong model because we have a long-term vision, which enables us to invest in the long term in tools and also in innovation serving the environmental transition next because we put the human factor at the core of our company. In other words, we're close to our teams because in the group, everybody has an informal relationship. We share ideas. We're more responsive. And we also emphasize the collective approach, helping each other, including safety at work. We have a very flexible decision-making process and we have stable teams, which enables us to build together and sometimes come up with customized innovative solutions for our client. And also being a family company produces trust. We do what we say and we say what we do. So this is -- it's very reassuring to know that we work on a transparent basis. And we meet our commitments, as you know. This is a further guarantee of quality because we avoid taking any reputational risk, which sets us apart from our competitors. This model is relevant because we have been able to build a full offering based on our values and industrial tools. We respond to the environmental issues for local authorities, companies. And with our industrial tool, we have a presence on the whole value chains. We offer integrated services for waste management, which enables us to provide full traceability, starting from logistics all the way to final waste management. At the core of our offering, we have enhancement, which means providing our clients with regenerated materials or low-carbon recycling energy. In 2023, we've also entered the industrial water cycle, and we respond therefore to the needs of our clients with the challenges of access to resources or to discharging into natural environment. In our services, we have remediation and depollution of soil. We directly contribute to the objective of zero artificial use. Industrial wasteland is used to support urban development as opposed to using farming land. Our offering also includes risk prevention through our industrial maintenance services, chemical cleansing or sanitation. The model has strong visibility because our mission is at the heart of the challenges arising from the environmental plans, and we use our tools and know-how to the sense. So we are in a growth sector linked to environmental transition, global warming and protecting diversity. And we're also at the heart of industrial challenges arising from rare resources with the use of water and energy. As you know, our offering is based on 3 complementary areas of expertise: the circular economy and decarbonization, which is 1/3 of our revenue; asset management business, 20% of our revenue; and services, 45% of our revenue. All these businesses serve the environmental transition of our clients. They all have their own growth momentum. And I'd like to give you some example to illustrate our areas of expertise. Now regarding circular economy and decarbonization, this is recycling where we can set ourselves apart using critical entrants -- from critical entrants, for example, with the -- we have an example of a client in the pharmaceutical industry with bromine. And we send this recycled resource to -- back to the client with full traceability. And this enables us to take part in the environmental challenge. Regenerated bromine produces 20x less [ GES ] and uses up 3x less of brome than an imported ton. The circular economy is also the energy enhancement. Our group is self-sufficient to 260% in terms of energy. In other words, we produce almost 3x more energy than we actually use. For example, we have developed the first CSR boiler, which was inaugurated in 2017. This is the solid recuperation recycling combustible or fuel. We use the fuel that can still -- that's being used but can still produce further energy. And this is used for the heating urban system. And we provide heating to a local farming cooperative. Another example in Salaise, our Tredi factory uses the heat arising from waste management. And we produce 600,000 tons of steel to the companies in [indiscernible], which accounts for half of the energy needs of the platform. This enables us to close down the coal plant. And this enables us to use -- limit the use of fossil energy and therefore the greenhouse gas emissions, 110,000 tons thus avoided each year in terms of emissions of GHG, which is the equivalent of [ tons ] such as it dumped around 20,000 inhabitants on our second area of expertise, managing hazardous waste, decontamination, for example. We are present in niche markets with high value added such as medical waste or in the management of dangerous waste. Hazardous waste, we have significant strength in specialized industrial gases. [indiscernible], the management of GHG enables us to use -- restrict the emission of GHG is 3.7 million tons, which is half the annual emissions of [ Leon ]. So this management of hazardous wastes also contributes to the goals of environmental transitional, the energy transition. And in terms of services, we have launched the depollutioned site at the former -- the depollution site on 11 hectares. And the remediation of this pollution will enable us to set up a new area while responding to the goal of zero artificial use of soil. We recently inaugurated the largest French -- site in France for environmental depollution after -- with our subsidiary, which depollutes the site and ensures the transport and management of hazardous waste. We intervened in the oil slick in 1999, in Peru in 2022. And the decontamination of lead in the crypt of Notre Dame de Paris and the Lubrizol depollution in Juan. This activity is in synergy with the waste management tools of our group. And we provide our tools and our know-how to enable our clients to outsource all of their environmental problems, and that's what we call -- or that's part of our global offering. Our competitive strength is in our differentiating know-how. We are an expert with a long-term positioning on industrial clients. Our clients are mainly in the pharmaceutical, health and energy industries as well as commodities. They produce complex waste and therefore encounter technical challenges. And this is where we provide them with our know-how, which we put in service of the circular economy. We have a dual expertise, dual know-how in the management of hazardous waste and also control over these hazardous wastes. This is reassuring for our clients and enables us to avoid dispersing hazardous waste into the environment, which is positive for biodiversity and human health. Our know -- technical know-how in terms of managing hazardous waste is therefore a part of the response to environmental challenges. In order to contribute to the energy transition of our clients, we have a strategy based on 4 pillars to provide the growth of the group. As experts, we're positioned on added value and the quest for excellence in execution. We are a specialized actor, and the group sets itself apart by its ability to submit differentiating offerings. We anticipate the environmental regulatory needs of our clients through our capacity to listen. Our commercial strategy is seeking operating excellence means that we look after our clients, we guarantee proper traceability when we manage their waste, and we base ourselves on flexible organization with a simplified decision-making process, and we want to have flexible organizational structure in order to be ever closer to our clients. We also have a cost-cutting organizational structure in order to implement synergies within the group. And we are constantly improving excellence in execution and also to provide a guarantee to our clients in terms of resources and implementation and also to enable the clients to meet their regulatory requirements and to ensure that -- protect them from reputational risk. We're constantly innovating as well. First of all, in order to improve our processes, improve productivity to improve our safety, compliance and to meet the needs of our clients and to offer innovative solutions and to anticipate regulatory change and be the player upholding best practices, which is what we've always done. And furthermore, this -- we have an active external growth policy with 2 key drivers: our first, quality in order to broaden our offering by integrating new technology or know-how; and also a geographical thrust, which extends our geographic coverage to be closer to our clients or a strategy based on new sites -- overseas in Europe. We're bolstering our existing presence. And further, we're building the broadest possible locale offering to accompany our clients and all this by maintaining strict financial discipline, optimizing operating performance, ensuring we have maximum free cash flow and a flexible balance sheet. Financial discipline is therefore a key pillar for this strategy. To go back on external growth, this is a pillar with 2 dimensions: first of all, extending the offering in terms of know-how and competence, for example, with the recent acquisitions in sanitation and industrial water management in France; number two, internationally, with significant stakes in Latin America, Italy and Southern Africa. Since 2017, the international share of our business has gone from 5% to 30%. We have moved ahead selectively with strict criteria. In terms of presence, we have criteria based on environmental protection. And we seek to deploy our position to roll it out as experts, applying our quality standards. And in terms of targets, we're seeking platforms to deploy our business and to accompany our existing customers. Just to give you an example of our service offering extension for our clients, in '22-'23, we made acquisitions to supplement our offering in the field of circular economy, addressing issues of the management of industrial water and sanitation. Offer was built on the base of our in-house expertise supplemented through our acquisition. Nicolas will come back in greater detail on these businesses, which are a new growth driver. Internationally, we have an M&A strategy to supplement existing network. In Northern Italy, we acquired the Furia platform to consolidate our commercial position. We're extending our offering to major industrial clients that are strategic, obviously, as a good fit with Mecomer, our other subsidiary, Northern Italy. The combination of Mecomer and Furia makes issue one of the significant players of hazardous waste in Northern Italy. We also acquired Rent-A-Drum in Namibia to continue our expansion in Southern Africa. We're relying on our expertise and tools in Southern Africa, the best meet the needs of industrial clients in that territory. Lastly, we also acquired Essac in Peru, a company that allows to extend our footprint to remediation and environmental urgency services, supplementing our existing offering. [indiscernible] Marco will tell you more about that in due course. International represents 30% of revenue today. We're positioned in economies with promising market with a strong industrial fabric and growing environmental regulations. We can leverage our existing tools and expertise. So the growth in our business mix is a growth driver as we see in our various businesses -- drive each other mutually our strategy rapidly grew the group to environmental services that went from 20% of revenue back in 2010 to 45% today. Services allow us to continue our logic value-added offering, complementing our capacity offering. It's a differentiating factor. It strengthens our expert positioning. The group also saw its offer extended in the circular economy business that linked to hazardous waste. The acquisition of All'Chem last year supplemented the activities and expertise of our Speichim subsidiary solvent regeneration. This strategy accounts for the strong growth these past few years. All activities saw sustained organic growth rates of the order of 7% per year on average. And going forward, we anticipate that services and circular economy business will offer significant growth potential. That potential rests on regulatory changes, but above all, clients' needs in terms of response to addressing their green transition need because our business is positioned at the heart of this challenge as witnessed by a high rate of eligibility and alignment with the European green taxonomy. The setting of nonfinancial targets that are ambitious by 2026 will allow us to strengthen still further our role as a sustainable economic player serving our clients. Pierre-Yves will set out to the objectives the group set itself to reduce the impact of our activities as well as those of our clients on the climate, energy, water or biodiversity. France's strategy combines the growth of our activities on the 3 areas we've looked at together, which are the ecological transition, decarbonization, hazard waste management, environmental services and an ambitious and planned approach, allowing the group to strengthen its position as a key player in the green transition. Pierre-Yves, over to you.

Thanks, Maxime. Good morning to you. Pierre-Yves Burlot, in charge of sustainable development for Seche. Maxime said our business allows us to address ecological transition issues. Those of our clients will see that with the taxonomy analysis. You know the European Commission published in June this year, the final version of taxonomy guidelines. So we analyzed on the basis of this final version, the European tax that confirms the good positioning of Seche Group on the eligibility and revenue alignment criteria for the taxonomy. As you can see on this slide, 86% of eligibility, 67% alignment. These rates are deemed good in respect to 2 comparables. The first comparable is focusing on waste and water management sector. We took 2 main players -- sector players shown here on the right of the Seche data and energy sector players. And you see that Seche has eligibility and alignment rates above its main peers in the sector. In terms of comparables, the European Commission teams had less 10% of economic activities in Europe meet the alignment and tax on EMEA, European taxonomy. So on the basis of this taxonomy, Seche Environnement is a sustainable player serving the green transition. Our goal today is to strengthen still further that sustainable player status by setting new targets through 2026. These targets have very same. The first is to reduce the impact of our clients who are involved in the value chain to supply various services to them. As Maxime said, the goal is that these services have the highest possible value added on green transition business. The second goal is to anticipate CSRD European regulation that will lead to more stringent nonfinancial report reliant transition plans for various environmental targets. We've already pledged to implement the main CSRD guidelines, and Seche's transition plans that will be presented to you today with the 2026 horizon. This transition plan rests on targets defined by size. So the group goal across the various criteria, climate, energy, water, biodiversity are the sum of the site targets planned by each of our entities, which affords credibility to our action plans and makes them very operational in their implement. Starting with the climate commitments. So to begin on climate. As you know, Seche has embarked on a decarbonization initiative, 2 objectives, one by 2025, reduce our Scopes 1 and 2 by 10% constant scope [ 2020 ]. This target of reducing of our GHGs was factored into the SLB, sustainability-linked bond, published 2 years ago. Second target at 2030, minus 25% of our GHG emissions, and that target by 2030 is SBTi-certified aligned with the Paris Agreements. Today, action plans are being developed, 2 main drivers: the first is to substitute fossil fuel with the low carbon from waste; and second key driver for Seche Group that of combating diffuse methane leaks. Methane has an emission factor far greater than CO2. 30x higher the goal is to reduce methane leaks to reduce GHGs of the company. We're confident as to the successful implementation of these action plans and the trajectory that allow us to reach these targets by 2025 and 2030. And so the '26 target confirms a target of minus 13% of GHGs. For the period beyond 2030, we're on R&D phases of capture and use of carbon. These R&D phases will be presented in due course by our director. Second, target on the climate front. How are we going to decarbonate via our activities, the Scope 3 of our clients? As you know, Maxime said, Seche is positioned on the recycling of specific high-value materials for Seche that sorting like the main sector players of packaging cardboard. But the expertise focused on specific material, bromine or solvents. Seche is the major international player in bromine recycling. Similarly, Seche, one of the main producers, have regenerated solvents in Europe. What specifically is expertise on specific recycling is that specific recycling sharply reduces the carbon impact of our plants for solvents, 5x less emissions compared to virgin for bromine 20x less as compared to virgin bromine. When our clients choose our recycled inputs, they're decarbonizing their Scope 3 materials purchasing today. 2022 production linked to recycling circular economy has increased by 11%, avoided emissions of Seche with its clients. Today, the success of the various Seche Environnement capability, the [ Maxi ] bromine initiative the summer, which won a circular economy award and the appetite of our clients for these recycled materials makes us confident in reaching the 25% [ or ] 40% avoided emissions in our clients. If the current trend is we plan to reach a 50% increase in avoided emissions in our clients' side, thanks to these circular economy activities. Other activities currently being developed on these specific materials through the All'Chem value chain presented by Indigo Blue or acetophenone third R&D director, Sylva will tell you about in conclusion on climate issue to goals, how we reduce our emissions minus 13% by 2026. How Seche is reducing its clients' emissions they were accelerating the current trend with a 50% increase by 2026. That's for climate. Moving now to energy. On energy issues, as you know, in a coordinated way with the support of the government, Seche has committed to reduce its energy commitment by 10% by 2025, in line with the energy efficiency plan launched by France. This reduction in our energy consumption requires various levers, of course, optimization, efficiency, process change to consume less energy. We're confident in reaching the minus 10% by 2025. We had a first impact last year with the first consumption reduction by 1%, which was a first in Seche. And so we're setting a target of minus 12% of our energy consumption by 2026. As a reminder, the target is to reach around 404 gigawatt hours energy consumed by '26. This energy efficiency plan also contributes to the -- to reduce our GHGs. When we consume less energy, we emit less CO2. Similarly, how Seche commits for its clients, we have second goal, which is to increase energy production that's renewable and waste-derived. We follow a metric, which is energy self-sufficiency. The link between energy producer and energy consumed, as Maxime said, we produce almost 3x more energy than we consume, 2.7x more in 2022. It's a metric that increases every year. Today, we're confident in reaching 300% 2025 with an action plan that is being rolled out across various energy types produce more heat, steam, hot water, more waste-derived power, more biogas with biomethane injection in the network. And so this action plan allows us to consider a 2026 target of 310% to strengthen even further the balance energy production by that date with 2 main drivers: acceleration on the recovery of fatal energy, low-temperature energy; and a second driver, which is the installation of solar panels on the various large extensive land-based facilities to increase further the volume of energy produced. This waste-derived energy, renewable energy also allows us to reduce the GHGs of our clients when they replace fossil fuels with low-carbon waste-derived energy. Here again, as with climate 2 objectives on how Seche is pledging to reduce its consumption and to help its clients to decarbonize and to use low-carbon waste-derived energy. Third action important that's risen in scale these past few months that preserving water. Water conservation. Here again, Seche in 2025 committed to reduce 10% of its water -- drawn water. It's ambitious. The government's asking by 2030 a commitment minus 10 for corporate Seche. Back then also set out a bigger ambition than that of sector comparables [ and not ] requested by the government. We're going to accelerate still further with minus -- by '26, minus 13% on water conservation, reduced water use. This is important, of course, in the context of water stress that we've experienced these past few months. But as Maxime said, Seche has deliberately committed to focus on industrial water. And the purpose here through this water plant that Seche is a showcase of everything done to reduce water consumption for our clients, an action plan of over 50 targets per site by water management in meters to digitize consumption, new, more efficient material, water reuse of growing prominence, process water, rainwater and also process changes to move to zero in terms of water consumption with a bigger investment. Once again, the goal is to demonstrate the full range of Seche Environnement and the area through rolling out solutions across our facilities. Final issue the historic focus area for Seche, biodiversity. A reminder, Seche embarked on its biodiversity strategy, 2023 through to 2027. In June this year, this new strategy led to a doubling of covered sites. These were done with the French biodiversity Officer, the nature and corporates for nature that's framed by the government. These action plans rolled out over 5 years with annual plans were built with our external partners, the [ Bot ] Protection League, France Nature, the National History Museum or the Robinhood Association. In order for the strategy to be rolled out over 5 years, it is audited each year by an independent body that certifies our [ DPF ]. And this audit is important because on climate matters, our goals and our diversity plan associated with external financing. And our success in this area will impact our commitments on financing. Now in terms of diversity, we proposed a range of measures that have been set up by our diversity teams. We have 6 ecologists, which is unique in industrial companies, strong know-how, which will enable us to have very specific actions, 170 kilometers of hedges creating 80 ponds, know-how in differentiated species management and the establishment of wetlands. And if you're interested in this, you can have look on -- you can come and visit our sites. So biodiversity permeates the man in the way in which Seche integrates its sites in the ecosystem. And we wanted biodiversity to be part of our value chain. And as I've been saying, our financing is based on biodiversity criteria. We also work on upstream value chains requiring our contractors to commit to biodiversity. And as Maxime said and as David will be saying later, this is in order to enable us to use soil land that has -- is wasteland rather than using farming land to reduce the pressure on the environment. And this enables Seche's clients to preserve biodiversity. We also act on the sites of our clients when they ask for our know-how to set up natural space to create ponds, to -- or to build hedges. And we have increasing demand from our clients for this know-how in parallel with our traditional offerings on waste management or water management. Moving to -- on to the recap, the summary of our group's commitments. We have a summary table here. As I said, green taxonomy positions the Seche Group as a long-term player in the energy transition. And with our extra financial goals, we are strengthening further this position. Our goal is to respond to the goal of our clients with adjustments to the energy transition. So I'll hand over to David, our Sales Director, who will be taking over.

Good morning, everyone. So first of all, I want to present 4 key factors that contribute to our sales. And then I'll be talking about our commercial outlook in France and overseas. So we have consistent growth in our revenues. And we're going to maintain setting up the MAXIBROME Paris. This is the result of several years of research by R&D, establishing a unique circular economy system, which confirms our position as leaders and the reference partners in the improved treatment of hazardous waste and will enable us to have sustainable growth. We have major innovation challenges to which we respond involving lithium and PFAS. Now PFAS are synthetic chemical molecules which are used widely in industry and also in consumer goods because they have a strong waterproofing capacity and are heat-resistant. Sylvain Durecu will be talking more this afternoon on what we're doing here. The group's capacity to respond to the needs of our clients and its energy dimension will be major factors in the years ahead. Regarding the service development, as presented by Maxime. The development of our service offering is a key accelerator of our growth. Our goal is to become a key player for all industrial companies. Our service offering is unique because it meets the outsourcing needs of companies that want to focus on their core business. We can support them on soil depollution, waste management, water and also producing low-carbon energy. We want to broaden this offering. And we're going to use our sales -- dedicated sales structure, [indiscernible], which provides a long-term cross-cutting approach between businesses and people. In order to support this, we're going to consolidate our position in France and overseas. In France, the establishment of Seche has enhanced our know-how and given us visibility with our clients. Through the acquisition of the ARI, we've developed our sanitation offering in a strategic area for the group. And finally, we've inaugurated our operating capacity through -- for emergency situations in respond to the growing needs of our clients. Internationally, our recent acquisition in Peru will enable us to diversify our offering in Paris. The third driver is from our ability to develop our capacity to process and enhance. With this strategy, we are pursuing a strong position in our -- in waste management. We have strong growth that we've achieved in the regeneration and chemicals synthetic treatment and also through the extension of our capacity in 2024. We have also inaugurated this year a process for polluted soil and land in order to support the service business for depollution of land in the [indiscernible] region. And also, we've doubled our bromine generation capacity. Regarding Italy, we have implemented at the beginning of the year our new platform for Mecomer for the treatment of hazardous waste. And Furia will be presented by Marco. And this completes our industrial offering and gives us a strong position in Northern Italy. In Spain, to continue with our decarbonization strategy, we're increasing our solvent regeneration capacity in response to local needs. And in Southern Africa -- South Africa, next year, we're going to have a new unit for processing industrial water, which will implement new technologies for water processing in order to process polluted products. And we have a new prefectural decree, which enabled us in 2025 to process hazardous waste with high value added. The last point is on our capacity to anticipate our answers to environmental challenges. Regarding environmental challenges, this often has an impact on the need of our clients and on our business. I start off by quoting PFAS. PFAS are currently being scrutinized by public authorities in France and Europe. The French government has launched a plan on this particular area. The European bodies are working on a plan to limit the use of PFAS molecules in industry and to apply strict waste criteria. These molecules are -- they're found everywhere in the soil and water. And they will require capturing our technology in order for us to be able to meet the customer -- our customers' needs through the water cycle and depollution of soil. Another point, the [ ZAN ] law to no longer using natural areas by 2050. There's a transition period whereby we're going to have to reduce by 50% our use of natural space. A large part of the industrial property projects will have to reclaim industrial wasteland. And what we're anticipating is a development of the business of soil depollution arising from this new regulation on ZAN. Now decarbonization, quite a few areas here. What's important for us is that we see a major change in procurement policy. As Pierre-Yves was saying, our clients have to decarbonize their business. And our strong position and our growth in regeneration of solvents and also for generation of low-carbon fuel puts us in a very strong position with the procurement departments in terms of the services we can offer. And the last point, energy efficiency. The government came out with an anti-drought decree, which will limit the use of water. And we also -- we already have major demands -- demand on the improvement of processes and also the reuse of industrial -- of used industrial water. And our positioning on water will enable us to respond to these requirements. These markets account for a bit less than 17% -- 20% of our revenue. We're multi-regionable -- multi-regional player with a strategic presence, enabling us to meet local needs with local solutions. We have a strong emergence of calls for tender for the operating or building of energy enhancement sites. We have a very pragmatic approach to these opportunities, and we select the sites, as we've already done with Montauban, and the work will be completed, and we will be commissioning the factory very soon. Looking at the more traditional markets for storage, these markets are in a strong growth phase and we will -- the need for non-hazardous waste will enable us to keep increasing our tariffs on a per unit basis. regarding the industrial markets, trends in industrial markets and even in 2024, depending varied by sector. We have Pharmaceuticals and Energy, which had strong performance in 2023 with a promising outlook for 2024. These will contribute strongly to the whole of our service business and also a regeneration and processing. On metallurgy & Chemicals, growth was slower this year. And our clients are looking for a flat first half and finally, in the construction sector, as you know, it has slowed down quite significantly. And we don't see a strong outlook for 2025. So in response to this, we have drivers. One of the first levers is that we have the ability, if necessary to reinternalize. We generate more volume than waste management capacity. So what we -- our goal is to maintain a high saturation level of the use of our facilities by reinternalizing and we also have a goal to achieve growth in areas where we have a low presence. And regarding the Hazardous Waste Management business in 2024, we're looking for a rise in unit prices of 3% to 5%, which will enable us to counter inflationary pressures. I'm convinced that the regulatory deadlines that I presented earlier, will generate strong medium-term to long-term growth drivers on the whole issue of [ PFAS ] management and work -- and water management. Looking internationally, briefly, the breakdown of our sales. We have 3 key areas of business, reflecting our business in France. Energy, Chemical and Environmental Services with 2 specific features overseas, no local authorities contrary to our French business. We position our offering on hazardous waste and industry internationally and also the mining sector, which is a specific feature of some countries, such as Peru or Chile, which are key sectors for these countries, in particular, in terms of service offering. For the -- internationally, the Italian market -- it's a key market, a key area of growth for the group. We have a specific sales strategy in order to develop our industrial offering based on our French business. The acquisition of Furia will increase our presence in the management of hazardous waste will also become a key player in Northern Italy. On the rest of Europe, we have solutions for managing complex waste in gas, lithium in response to regulatory requirements and the need to stock GHD gases in -- our acquisitions in Southern Africa will enable us to roll out our offering in a familiar environmental -- familiar environment. This will enable us to accompany some of our clients in energy and mining who need quality service in Namibia. And regarding interwaste, the investments I presented earlier, management of industrial water and also in response to the prefectural decree will enable us in '24, '25 to grow the subsidiary in Lat Am. Our 2 key subsidiaries have a goal, which is to acquire new clients through delegated management with strong quality criteria. We're working on the management of the circular economy and the rules, regulations require us to improve energy efficiency. We've already identified depollution projects in Chile and Peru for depollution of soy, which enabled us to grow the revenue. Thank you very much. I'll hand over to Nicolas.

Thank you, Nicolas Rogeau, Head of Operations in charge of service activities, I'm pleased. to present our industrial water cycle. I'm pleased to do this. These are activities that we initiated a few years back. Here we are. We have the slide on screen. So I resume my flow, sorry about that. So -- as I said, I'm pleased to present these activities that we initiated within Séché a few years back that we developed strongly since the recent acquisitions made from Veolia today we're a major market player. And my goal is to present the purpose for Séché to develop the industrial water cycle business, talk to you about our skills, expertise and then I'll tell you a bit about the outlook for us using the slide changer. So it's true the questions is asking why has Séché embarked on industrial water cycle markets. It's pretty obvious, 2 fundamental reasons why we embark. It's a sovereignty [ SU ] for the group because all our industrial activities, more -- the more legacy Séché as wastewater recovery directly affected by water issues. So it's important for the group to master the technology operation, we shouldn't depend on the competition may sound obvious, but it needed to be done. That's the first major region. Second important region is a major industrial customers wanted Séché to support them on reducing their environmental footprint of their business. And a key component of reducing the environmental footprint of our clients is water. So what I've done on this slide is to summarize the service offering for our clients to assist them in reducing their environmental footprint. There are key issues to talk of the resources, these materials, land resources, energy image ecosystems and of course, water. And so thus far, we were well positioned on the materials resources, waste management circular economy solutions on the land with decontamination activities. We're currently expanding on energy generation and low carbon energy supply well positioned on the interventions front, but not positioned on the waterfront. That was a request that came clearly from our major clients. So -- it's against that backdrop that's important for Séché to develop this industrial water cycle. I'll now present in greater detail what the industrial water cycle represents within Séché. We're present across the value chain, upstream, downstream like any industrial process needs water to manufacture, to produce need to be able to produce process water. We're going to draw the water resource treated, make it fit for industrial use at upstream once it's used in process, produces effluent generally polluted that needs to be treated. So the group has positioned services, both upstream that we can roll out process water solution, but also downstream for effluent treatment. We also have this ability to manage the full water cycle, both upstream and downstream and associated with all these effluent management process water treatment. There's sanitation and maintenance activities. There are networks that contain -- connect everything we need to build to maintain these networks. That's why it's important within the water cycle, we can invest on sanitation activities that are systematically used on this type of activity. So seen today, this is a substantial business for Séché. Over EUR 100 million in revenue this year. It's 680 people. We cover over 170 customer sites on water cycle, 21 branches in France on water cycle for industry and 10 units that allows us to roll out network maintenance and sanitation. So we have a full range of expertise. So on the expertise front -- what's important on the water cycle management is that high technological content. We need to be able to master this technological content and to offer a range of technologies to meet the need of the industry, unlike municipal, industrial water cycle management is purely a personalized customer base. There are very few systems that are reproducible from one facility to another is to deploy the right technologies to have the right solution, good engineering capability. If you can offer a solution, you need to roll it out to be able to build the installation and to operate it over time for the client and of course, operation. We need to be able to maintain these installations. It is full range of expertise, this comprehensive suite of expert with teams of Veolia from the acquisition and those of Séché, there was a big integration effort undertaken this year leading to an efficient setup on water cycle management, combining all the necessary skills and expertise. And Séché designs, builds, water, treatment, effluent treatment process plants and can operate all these facilities for its clients and to maintain them to an acceptable level. What I also wanted to show you, to illustrate this level of expertise, I wanted to show you a brief 3D animation. It's just going a short trip here. But what's interesting, it's not a very big facility, but one that clearly illustrates the needs of our industrial clients. This is a facility that we built that currently being commissioned and the client is from the pharma industry, and these are micro pollutants, the effluents that emerged from the industrial site contain active principles. And today, the government compels the industry to no longer discharge these micro pollutants. We had to implement a technical solution for the client to no longer discharge, release these micro pollutions. This animation is just the last 3 minutes. What's interesting is that we have a very designed building. It's sustainable. The shell is made of solar panels and you got inside the vessels to receive the raw and treated [ effluents ]. It's a process that's interesting. Here, we've implemented the latest high-tech for effluents treatment have the bio treatment, but also membrane-based treatment, reverse osmosis filtration water and then active coal, and it's the contamination of these technologies defined by engineers that guarantees that there's no active principle discharge these residues can then be treated within Synergy that's leading to immediate obvious synergies. So you see, it's really the changes reflecting industry with perhaps used to seeing major infrastructure by big water players, a lot of civil engineering from municipalities and there are big facilities, but also these types of facilities because needs are evolving. So the visits coming to an end. But I like this one, it's -- so that's the membrane-based technology. It's the heart, the core of the reactor. I think we can move on after that fascinating clip. Thank you. Next slide, the outlook. So I told you why it's important to be positioned on this business. What lies behind is business, and it's important that there is business. This is a sizable market, industrial water cycle -- it's a market that's outsourced to the tune of 15%. Industrial internalized a lot -- I mean so there's significant percentage linked to the outsourcing trend. It's a market of EUR 1.8 billion outsourced to the tune of EUR 275 million versus the 2021 figures. With the new needs currently on micro pollutants on reuse, of course, we expect this market to grow further. Underlying trends are there to drive this market. Outsourcing new issues, design and build new facilities to comply with more stringent requirements, design operation were asked to operate these facilities, it makes sense to outsource when we change infrastructure facilities, growing regulatory requirements ever stringent and then water -- limited water supply that's emerging and that has been expressed for the government that's responded with a water plan, 53 measures. I don't know them all of part. I'll be honest with you, but the main measures supporting the need to successfully manage water to reduce pollution or this automatically fueling the market need. We have a presence that's quite significant. We're quite a major player. We have market share. So we estimate to be significant certain activities that are strategic for the group, materials, chemistry, chemicals, pharma, pharma, very resilient sector -- and bottom right the portfolio type, chemicals, pharma, metallurgy, our research and defense industry resilient, agri-food, new interesting sector, quite a lot to be done there in a few other sectors. But it successfully consolidates the group position on its traditional markets. And then you got this map of France with all our contracts. So we have national coverage that's very significant and interesting. So what's the outlook within Séché for us to take advantage of all these opportunities? We're in the integration phase. Integration is a transformation. We have ambitions to transform to make this activity more profitable. We've integrated a lot of contracts an operational setup management system that needs to be completed. These are things that are going well, but it gives us a useful potential to rationalize and optimize the portfolio to boost the profitability. These activities, putting them at a target level of the group on the service activities. So this is substantive effort underway on that. Second key driver that we're working on is internalizing value. As I said, our industrial activities need to work on the water cycle. We haven't internalized between our industrial activities in the industrial water cycle business. We have issues that we may -- rather than outsourcing those is used to our competitors potentially is really to internalize them. There's interesting potential that we're designing it, so as to leverage it to the [ following ]. Within the service activities, mentioned waste management, water cycle, of course, remediation intervention within the service activities, well, there are possible synergies. I'll give you an example. You have a waste management contract on a big refinery while the operators of this type of call upon sanitation providers rather than subcontracting that we should internalize that type of service, it's really to internalize values that are useful opportunities to work on. So we're working at -- on those who are currently quantifying the value internalization potential to roll it out. Last interesting point, we already have a critical mass, but we plan to develop this activity further. Two key focus areas that we're currently working on for operations and maintenance contract is an opportunity for additional noncontract services that increases your revenue base by about 15%. These are generally operations where we improve client infrastructure with spot operations. These additional ancillary value service operations, there's that potential to be fully tapped and exploited and then cross-selling need to know that through our service activities in France were present daily across over 300 industrial sites. They all have water cycle needs, waste management and so on and so forth. So we need to cross-sell to leverage all these positions to roll out our service offering and by describing an example, the pharma client, we like pharma, it's a high-value, resilient sector. Here was you can see it's the -- this example is interest -- it's the input of water business to the waste business that a pharma client were present through a maintenance contract of facility. It's methanizer 3-year contract, industrial effluent treatment plant operated by the tour agency. It's going well. the clients happy with our quality of service, quality, said, well, I know you do the water, you do waste management. We plan to outsource our waste management operations. Could you support us in this solution? And what we did, well, quite simply, we answered yes. Séché happy to support you. Yes, we'll introduce the specialist teams to you, yes, well, screen your needs, and we can make a proposal. The big advantage here was there was no tender. It was on an agreement basis. On the contract, what does this mean for say EUR 500,000 in growth, plus EUR 500,000 year for the group. There'll be further examples. Waste contracts will yield opportunities for the water circle, but we see that as useful, create dynamic within our services. I think this strategy is right for Séché going forward. Thank you. I'm going to hand over next to Marco Paesano, he is International Sales Director. We've only spoken about France. I hope Marco will tell you about the international water cycle business over to you, Marco.

I'm going to present the Italian market. I've got ahead of myself right? The Italian market accounts in terms of size, the second largest market for Séché after France and the third largest after France and South Africa. Italy is a proximity market, a long-standing market. In 2019, we made our first major acquisition Northern at Italy, Mecomer, next to Milan. This is in Lombardy, which is the largest industrial region in Southern Europe. Mecomer is a center for the processing of all types of industrial hazardous waste from clients in the chemical sector, the energy sector and the pharmaceutical sector. This first acquisition enabled us to become an active stakeholder in the Italian market and to produce multiple proximity-based solutions to all the key industrial players in Northern Italy. In 5 years, the -- over the past 5 years, Mecomer has recorded strong growth with a strong resilience during the pandemic, revenue has gone from EUR 47 million in 2019 to EUR 58 million in 2022 with strong prospects for the years ahead. We'll come back to this. And we have -- the headcount has gone up from 100 to 150. And we we're going to have record tonnage this year, 50,000 tonnes. The second major phase for Mecomer, which finalized in June 2023, an extension -- industrial extension plan -- it was a major investment for Séché, approximately EUR 25 million. This investment will enable us to significantly boost our processing capacity and to respond to the growth -- growing demand from our clients. this is 200,000 tonnes. The surface area of the platform was almost tripled from 5,000 to almost 20,000 square meters. We have commissioned a new facility for liquid waste and all we're able to process inflammable and toxic or waste. We have tripled our capacity with a 140,000 square cubic meters. This is the strongest [indiscernible] capacity in North Italy. We have many new technological resources. We have a new laboratory. Internally we have computerized way bridges, we have central fire detection and extinguishing systems. We have a new workshop for reconditioning reactive toxic chemicals, which is unique in its field. And we have 2 new mixing pits for sludge waste. Next, the platform has 2 regenerative thermal oxidizers, which is a novelty in Italy and we're able to deal with all the waste. We have new ATEX classified areas for reconditioning, powdered waste and solvents. And now we're going to go a little bit further. We have a visit to the best equipped plant in Italy. [Presentation]

So that's for Mecomer. After Mecomer, we recently completed an acquisition in Italy. We spoke about this earlier. Maxime mentioned it. Furia offers strong complementarity with Mecomer geographically and technically, it's a family-owned company, established 1916, 2022 it recorded revenues of approximately EUR 52 million with [ 130% ] is Furia is based, as you can see on the map in Caorso, in Emilia, Romania. This is one of the most industrialized regions in Europe. We're still in Northern Italy here, 45 minutes to the southeast of Milan and Mecomer. Furia is platform for preparation of hazardous and nonhazardous waste. The service area of the platform is approximately 14,450 square meters, specializing in the preparation of solid waste, and it has an integrated laboratory certified by ACCREDIA, which is the main accreditation agency in Italy. And of course, it has all the ISO certifications, quality, safety and environment. The integration of Furia will consolidated the strength and the offering of Séché in specialized waste with an offering for large industrial companies with Furia, our positioning will be complementary services and businesses on which we previously did not have a presence through Mecomer earlier. And we have the construction site business, specializing in the rehabilitation of polluted sites and all the associated activities, excavation, demolition, decontamination. Furia has 2 mobile units with significant capacity enable it to intervene on major sites. We have emergency responses units, where we already have a strong expertise internationally. The other division is total waste management with significant medium- to long-term contracts for large corporate accounts. Furia has a very diversified portfolio with a very well-known clients in the energy sector. Energy, Eni, Enel, Italgas. And all these activities are implemented through the Caorso platform -- solidification, stabilization, physical and chemical treatment, soil washing and all the sorting and screening activities. So this acquisition is a strategic phase for Séché and [ Veolia ]. We're going to be offering our Italian customers full and stronger services, which will enable us to consolidate our position in Northern Italy with global revenues of EUR 117 million. Séché Italia is becoming a major player. We are one of the top 5 players in Italy. And we, among the top circle of leaders internationally with a strong presence with all the industrial accounts in this market. Thank you very much. And now we will remain in the international business. We'll go a bit further with Shoba, who is going to present our business in Southern Africa. Thank you very much. [Presentation]

Thank you very much, Shoba for that very full presentation and for those very nice photos and footage. So we're finishing a little bit earlier. We didn't go to the end of the visit of the industrial waste facility. We'll resume at 10:45 sharp. Thank you very much for being with us for the first half. Thank you. [Break]

Ladies and gentlemen, hello again, and thanks for being with us for the second part of today's Investor Day which will be on the operation and financial outlook to 2026, and I will immediately hand over to our Director of R&D Sylvain Durecu.

Thank you, Manuel. Sylvain Durecu, Head of R&D. I'm going to present our R&D strategy. First of all, a few reminders of our objectives on R&D. Three goals here. First of all, to develop the technologies of the future. What are the technologies to be implemented in order to meet our clients' requirements, mainly industrial clients. What are the medium-term projects to work on innovation regarding the waste of the future, and what are the disruptive technologies to implement to respond to the environmental challenges of the future. The second goal is working for our industrial customers. This means implementing our know-how, working with our commercial teams to meet demand from the sales division, which will need our support in order to have a differentiating approach in order to distinguish us from the competition in technical, in environmental terms and also in economic terms. The goal here is to make proposals that are win-win for the clients on the basis of the 3 criteria, win-win for us, too, in order to have a growth in the results of our core businesses. The third goal is supporting the group's activities. So we'll have demand from the -- our plants, improving processes. What do we need to do in order to meet regulatory requirements to limit our discharge. What do the resources need, when the users do not necessarily have the know-how or the resources required. Also for us at R&D, it's an opportunity for our young team to learn the businesses, and learning on the ground is an excellent way of learning. Now I'm going to set out a few projects that we're going to be implementing over the next 3 years to meet the first goal regarding our goals in terms of innovation. First of all, recycling of metals and strategic minerals with the requirements of the French government recording the substances, which are high criticality. As you can see at top right, you can see that lithium is -- has high criticality in terms of the development of batteries. Lithium in 2022 at global level, we use 120,000 tons per year and by 2050, we'll be increasing to 1.3 million tons. So this means that we have a lot of work to be done in terms of recycling because the regulatory requirements in Europe are going to change from 2027. And there will be mandatory requirement regarding the end of cycle of batteries with a requirement for recycling of 50% going up to -- and as part of this, we'll have to re-include recycled lithium waste in these new batteries with the outlook of 6% by 2035. The markets that we're targeting for the recycling of lithium, the deployment of the gigafactory, which is being built in France, in Northern France, in particular, and also the market from lithium affluence from these gigafactories. In the chemical industry, everything that is going to be used for manufacturing electrolytes which will provide the conductivity in the batteries. This will produce a lithium-based affluence. So all these markets are captive markets over the next few months and years with mandatory recycling requirements. I could also quote in the mining sector, some activities that may emerge and which will generate requirements in terms of recycling in that market. Now looking at fluorine. Fluorine is not shown on the graph, but it has a high criticality similar to that of lithium. In France and even globally, there's very high dependency on 3 countries, which account for 80% of the fluorine market, China, Mongolia and Mexico. Séché has a strength on criticality, looking at our capacity for -- we've -- a lot of work has been done. And Séché may in the future become a specialist in recycling for fluorine. The relevant industries by the fluorine market, the chemical industry, metallurgy, and the steel industry. Now Pierre-Yves has mentioned this, looking at the reduction of our GHG emissions for ourselves and for our clients. The first point here, looking at the regulatory level, the [ EC ] in the years ahead will introduce for the waste market a CO2 emission quota. And by 2028, 2030 regarding household waste, incineration of household waste, and 2030, 2040 for the incineration of hazardous waste. And for us, this means looking ahead, anticipating these needs arising from regulatory change and minimizing our impact. So the first issue here on carbon capture. We're going to base ourselves on feedback from our industrial experiments here in the regeneration of bromine. As part of this project, we are working on oxygen-enriched air. And this is what we want to develop in our plants, which is oxy-fuel conduction, recycling the smoke generation or gas -- it's fuel gas recirculation. So it's a mix between -- mix here. And the idea is to produce a model on the plant of the future. And also on our existing plants, the goal being to have on our flue gas, gas that is highly concentrated in CO2, 90% to 95% in terms of CO2 concentration rather than on standard combustion processes where you have 10% to 15% concentration. So it's much easier to work on GHG emissions to work on concentrated gas rather than diluted gas, and nitrate balance accounts for 90% of the volume of flue gas. We're going to work on that in order to eliminate this nitride balance. The idea is to work on concentrated gas in CO2, which is easy to handle and also cheaper to handle in terms of the carbon capture of gas. The second issue is the enhancement of carbon. And in particular, biogenic CO2 which has a neutral impact on global warming. But in future, the CO2 will generate major economic benefits, and the goal through our work is to work with partners who have developed or who intend to develop molecules based on CO2. In other words, biogenic CO2 and this could come from our methanization plants where you have a surplus CO2 and methane, and the goal from CO2 and methane is a driver formatting. In other words, what are the organic molecules that are of interest looking at maritime transport and air transport on what -- how could we manufacture this using biogenic CO2, which could so talk about methanization. What are the transformation procedures that we can implement using CO2 and methane by manufacturing hydrogen in order to come up with methanol that would be used in the maritime transport sector, and also sustainable aviation fuel, SAF, which could also be produced as part of these new activities. The biogas sector is important in terms of enhancement. What are the conditions on -- for R&D, which will enable us to increase the methane content of biogas. The goal here being to work on the limiting factor in our storage facilities, and we can see that one of the limiting factors in particular for the biogenic factor is the water context. So what we're planning is to work on the 3 horizon to start the work on this and to work on what we call the distribution of water in storage facilities. These are technologies which involved demography, where you have electrode that we will establish on our sites with storage facilities of nonhazardous waste in order to see what is the breakdown of water. What are the means required in order to reinject water into the landscape scenery in order to generate the production of biogas and to reinject methane into the network. Now looking at the fourth item, which is mineral waste stabilization here. We're talking about storage of hazardous waste. The goal is to limit our carbon footprint. What are the means and what is the waste that we could use in order to set up a new grid for the print of CO2. The objective here is to develop new cement by replacing calcium and avoiding use of CO2 -- sorry, of calcium and to limit our carbon footprint. And finally, regarding our customers, as we said previously, as part of the acquisition of All'Chem in Montluçon, where we're currently working. These are strong achievements on 2 programs: blue -- indigo blue is an artificial coloring used in the textile industry, which has a strong carbon footprint, 10% of global emissions, and artificial coloring has a 10% footprint as part of the global footprint of the textile industry. So the benefit of working on an indigo blue which is biosourced, which is manufactured naturally rather than artificially is to have an interline production, which is in order to ramp up our production and to reduce the carbon footprint of the textile industry. The second project is acetophenone which is a product which is used to create fragrances. And the goal using the work we're conducting on a recently acquired entity by the group is to have the recycling capacity for this unit, involving [ euphenol ], what are the means to be implemented, and this is the work that we're conducting at present with the All'Chem teams and the Speichim teams in order to come up with recycled acetophenone. And as has been said previously, on the basis of recycling and therefore, reducing the client carbon footprint, which use this acetophenone. Now fluoride substances looking at PFAS. And as you can see, we're talking about non-polymer substances. This was close -- quite as part of the regulatory changes through decree of the 20th of June '23 published this year. So there's now a regulatory control over non-polymer fluoride substances. This is PVDF or PVT -- PFTE (sic) [ PTFE ], which is Teflon. These molecules are not necessarily governed by controls in terms of discharge. They're not soluble in water, but the non-polymer molecules. Some of them are soluble in water, and therefore, they're governed by specific regulation on the monitoring of 28 substance. And on this issue, there's a controversy on the ability. Well, this is information that's currently available on the financial literature, the scientific -- the thermal deterioration of non-polymer substances. Since 2021, the group has been working on this issue. We're going to continue the demonstration of our hazardous waste incineration facilities on the ability to effectively destroy these substances to address difficulties in the literature about the abilities of plants to destroy these molecules. So work has already been done. In some of our plants, and we're going to continue the demonstration in our plants to meet future contracts. That was mentioned by David on this issue of PFAS markets. Now the issue doesn't just concerned hazardous waste issues, but as was also mentioned some air pollution on these perforated molecules. They have this [indiscernible] some are soluble, others not. So this is a specific issue on soil contamination. So several techniques can be considered depending solubility of these curated substances. We can look at washing, extraction, stabilization techniques on these perforated substances. We want to work on an avenue that would allow to the destruction of these molecules directly on the basis of the soil matrix. Third issue that's currently underway. We initiated a joint project with Academia. To me, as part of water pollution through non-polymer PFAS to see what can be implemented both to concentrate these perforated substances in a minimum volume can be membrane-based technology that Nicolas was talking about. Micro pollutants, we want to go further to the destruction phase after concentration during a membrane phase, we want to work on the destruction phase for these perforated molecules. Of course, all these issues will fuel our service offerings. Notably, STEI value chain is Nicolas, new area of activity of Séché in water-cycle industrial water. All this work will enrich our service offering on the basis of these contracts. Thank you for your attention, over to Franck.

Thank you, Sylvain. Good morning. Franck Morineau, in charge of Industrial Operations of Séché Group. So with industrial operations, we have 2 major objectives. Customer satisfaction and service and equipment performance. Linked with organic growth, strong M&A growth, we put in place back in October '22, a new setup within the group, 6 major divisions: special waste, nonhazardous waste, chemistry industrial services, international supported transversally, supply chain in charge of planning and transport and integration of all support services. The Investor Day is a good opportunity to thank all our people for contributing to this recent growth. And there are objectives that were presented in previous slides. That's to say integration, the concern for us to welcome new people France, international. It all happens in the first 90 days. Very important that they feel good, working for us, well received and highlight their value added. My thanks to the teams who were successfully involved in the onboarding process. In Pierre-Yves presentation, you saw industrial requirements and changing in 2023, no longer required for short-term operations, but also work on energy consumption, water consumption. Of course, we're asked to focus on biodiversity and Séché teams have made that change very successfully. Final step, I wanted to initiate through this matrix-based organization is synergistic opportunities. Today, we have a big synergy opportunity if communications go well within the organization. There are many contract opportunities that are outsourced that we're going to re-internalize with our know-how. In summary, we have a 90% client portfolio, expecting agility, flexibility from us and more efficiency, complying with safety rules, regulations in France and abroad. To target the best safety standards and ensures industrial efficiency on Seveso site management in parallel. We can protect our people's health, which is dear to us. We're uncompromising in this field, which requires a regular site visit, by management, every layer in the organization down the road where mass certification for all our units. We already have most that are certified. We're continuing in that process. Obviously, it's to protect our people, but not only safety standards to work in industry. If you don't have the safety results, if you are in a position to demonstrate your safety efficiency, you don't get a contract. It's crucially important to clearly understand that safety is key, and it's really the demonstration of our performance and a balance between flow processes and equipment and people. Well, obviously, what we apply in terms of safety also applies on the regulatory front. Here are a few examples we're able to generate with our teams on procedures, focusing around 9 vital rules, confined spaces, the machines and tools, working at height, these are risk areas. Chemical, biological risk, close to moving devices, lifting, weight transfers, hot point, energy, logging, manual handling around these vital rules, we have a shared processes for assessing the daily risk for all our people. We see the results, the indicators is obviously important in managing industrial operations where the incident frequency rate is trending heavily downwards, giving a strong signal to our clients and our employees. Expertise is the key to performance training within the group, international rollout. We don't just remain focused on France in the safety front, I'll give you some examples of how we optimize our treatment and the way we structure our process is we've been agile very efficient with the recent acquisitions, where there were gaps. Identified on incoming companies versus safety and regulatory approach. Both health as well as safety. We have a strong impact on regulatory gap. Obviously, our requirement is zero defects. We put in place major site visits, internal audits in order to monitor and check our industrial compliance, 19 audits in '22. We're at 37. Today, we trained auditors. We have a pathway for regulations that rolled out a bottom up, not just top down. We get our people, our operators to take part of whatever their role to achieve zero regulatory deviations both in France and abroad. And it's part of living well together, both on site, but with our neighbors and the authorities of the country is concerned, it's crucially important that industrial networking of Séché is in good harmony and complies with regulations to bring that about. A few examples on the CapEx front, industrial efficiency obviously means investment to obviously focus on safety and regulations. 30% of our CapEx linked to regulatory and safety matters, but it's also to meet to an expansion need for our capabilities or manage obsolescence and have maintenance cost trade-offs, not to go too far. Sometimes it's relevant to replace or invest. First of all, CapEx is part and parcel of profitability analysis beforehand by the investment committee. We have lively debates with Baptiste and his team to know where we put our money in making sure that the return on investment is there for the group, and also meets with the client expectations. Shown here a few example: Denox EUR 1.8 million for the upgrade of Nox treatment lines in Trédi-Salaise as we're able to safely produce more steam for the Salaise facility. Loads of examples on the slide, they speak for themselves. But this CapEx segment is a part and parcel of weekly governance of Séché. And then, of course, we have some examples of productivity improvement plans. Just want to focus on Speichim Saint Vulbas, new circular economy loop for acetonitrate (sic) acetonitrile regeneration, double capacities for the client. [indiscernible] another example on solvent. [ DMF, dimethylformamide ] 4,000 to 6,000 tons a year for a plant that are going to be rolled out. We have the examples of the incinerator at Montauban, 20% additional tons processed plus 48% recovered thermal energy with new power generation of 17 gigawatts. Several examples in terms of supply chain on better mastery of the waste flow from plants through to our recovery and processing centers. Important to have this trade stability. Logistics, done great effort in terms of collection and receive collection to promote processing through the harmonization and generation of new revenues. We can generate major productivity efficiencies, better traceability for our plants. So these are productivity examples that had a major impact on our facilities. We see the 900 hours of time saved at Trédi-Salaise. That's over 8,000 tons of waste treated. Few international examples. We've spoken at length of water treatment, liquid waste. We see that by bringing optimization solutions or reductions. There are possibilities of productivity that are interesting international. The reuse of process water 65% less water for incineration. It's an example. Synergies between various purchasing policies to obtain better prices on bigger volumes. We also have transport cost reduction opportunities with supply chain and logistics, try to make more operative and more efficient all the Séché group flows. Still on the supply chain, I just want to focus on the fact that we have here short term to implement an operational planning sales and operational planning is in place across the major global industrial standards. Sliding 24 months with commercial forecast to integrate upstream the resource needs and will come back to that in a moment. Also CapEx requirements. Today, we turn far more to submit, we need to anticipate the 24-month vision by putting in place supply chain allows us to anticipate these points and to focus better on our CapEx. And it's part of our IT and digital transformation plan. We've strengthened our systems, notably for transport with a new TMS, but also on the planning system. We're working with advanced planning system and flow simulations, all this with modern enablers allows us to converge with the productivity opportunities. We can't not mention our people. We have a team to which we're very attached within Séché that's highly motivated. We see over time that on certain businesses. We have very real significant training needs and obviously, it's better to do it ourselves. That's the best solution to have a school of knowledge at Séché. School of knowledge based on a recognition, no academic training in some of our businesses is clearly, post World War 2, quite a lot of effort done on training for incineration, that's disappeared. We have no longer gateway to train people for incineration. We have people who must as of now undergo vocational training to deliver automation within the group. We have 4 major families of businesses that are trained. The supervisors, maintenance technicians and platform chemical professionals for this. We have to support or new requirements, strength in regulatory and safety culture presented at the outset of more intervention. And of course, we have to prepare people to operate new facilities. So we decided to put in place a school of knowledge with the following ambition: support teams in mastering key skills, preparing the next generation to operate and maintain the facilities, to attract and develop talents within the group. That's important for us is, of course, internal mobility. Today all our exposure international South Africa, Chile, Peru, Italy was done with homegrown people trained with the right expertise, the right values, our culture before rolling out locally with the local teams. And that truly a focus area. We want to maintain that we're attached to through very tangible examples. We've been able to grow people who entered junior have now become senior and returned to France and assume great responsibilities, pass on knowledge, ensure mastery methods, to promote our professions in schools, career affairs. It's with a very strange jobs market, visit school share our knowledge, promote work study programs to instill our corporate culture. Define integration paths for new employees to attract the youngster is necessarily short term, 3 years. He wants clarity in his career. We can offer other opportunities to define training paths to support employee development. We delved into our pool of seniors to supply this training, make sure that their knowledge is captured before they leave the company. I'm going to hand over to Baptiste for the financial trajectory. Thank you.

Thank you, Franck. So to what your appetite, I will present the financial outlook for 2026 to pursue growth, improve operating profitability and maximize free cash flow generation over the period. First of all, a quick flash back to our historical performance. With a chart here that shows the group's historical performance in recent years, which has been strong, plus 7% organic growth of our business, plus 10% organic growth in our operating margin in -- of our EBITDA. We have a contributive growth -- contributed revenues close to EUR 1 billion. And cash flow -- a change in EBITDA of EUR 215 million to EUR 219 million, excluding 2023 acquisitions, which happened at the end of the year, mainly arising from the acquisition of Furia and Essac. My accent is not as good as [ Maxime ], I'm sorry. Now this is an information-packed chart that you have here, but it shows how the group has performed in terms -- in relation to GDP growth in the various countries in relation to global growth. And what our current forecast in these geographical areas, first of all, we went back to 2000 -- from 2019 to today, looking at to 2026. So these are IMF figures. These are not Séché figures. We have the growth of the various countries. We have global growth and global growth, of course, is not completely relevant for us because we don't have a presence around the world. So we've reweighted that. We've readjusted global growth on the basis of Séché weightings, which is 70% in France, 14% in South Africa, 7% in Latin America, 3% in Spain, 3% in Italy. So we have the weightings. And in 2019, weighted growth on the Séché plus 4.6%. So you have the figures from 2019 to 2023. A few comments on this. Overall, on the basis of organic -- past organic growth, Séché is outperforming weighted global growth to the tune of 3% to 4%. So Séché is global growth readjusted plus 3% to 4%. Second important comment, Séché has been a resilient company in 2020. The year of the pandemic with global growth that stood around minus 7.5%. Séché was down minus 2.5%. And that year, we had EBITDA of plus 1%, which illustrates our capacity in those difficult times to be resilient and to control our cost. Next, looking at the future. The -- IMF, looking at the October 2023 outlook is looking at lower growth in terms of forecast than historical growth rate, plus 1.4% in 2024, plus 1.7% in 2026. On that basis, we used growth of plus 5% annual growth over the period, which on average corresponds to what we've seen as the surplus organic growth in relation to growth forecast. And in relation to the historical growth weighted according to Séché parameters. Next, we have performance levers. We've spoken about this, this morning. We tried through our work to put the figures, objectives on the basis of the performance that we can achieve 3 key drivers, which are fairly conventional growing profitability of existing or new businesses at present. We have businesses which underperformed -- underperforming in relation to the initial business plan or the profitability that we are hoping for. So this is putting profitability back at the expected level of performance. And in that respect, we can go into greater detail on this. But the activities have been mentioned. This concerns SOE presented by Nicolas and we're looking at plus EUR 9 million on Europe in 2026. Secondly, industrial efficiency. Franck spoke to us about this. This is an ambitious program for industrial efficiency. To improve the efficiency of our tools, to improve our products which will enable us to release capacity. And this will improve profitability, this estimated impact, plus EUR 5 million on the return on capital. And then controlling our operating expenses, mainly in procurement. I'll go back on this optimization and savings -- cost savings that should generate plus EUR 17 million on Europe by 2026. Going back on the last point, which is reducing expenses and controlling costs. We're working -- this procurement division is working on the basis of EUR 275 million expenditure. The idea is to go for EUR 20 million over 3 years, minus 7% on the 2022 cost base. What are the drivers or the tools for this to reduce cost. First of all, transport, 14% is -- accounts for 14% of the expenditure. So this is not all of our spending. It's spending items where there was a direct audited lever on which we feel we can apply a credible action plan by 2026. On transport -- transportation. We think that we can reduce transportation costs by 13%, mainly with tenders on charters, sharing the assets and bins, more control and optimizing the journeys. The second aspect is raw material and reagents. This involves energy. The goal is to have a call for tender from our suppliers, remove intermediaries, reduced intermediation margin. Thirdly, operating expenses, massifying expenditure, having calls for tender in a professional way, packaging purchases, suppliers were digitalizing our procurement policy in order to have more attractive group prices rather than purely local prices. Once you've said that, International business provides new sources of supply, new suppliers who are competitive and who can help us globally to optimize the expenditure of EUR 20 million in conventional terms, is gradually increasing, ramping this up over '24, '25, '26 in order to achieve the target of EUR 20 million by 2026. Bearing in mind that we've only factored EUR 17 million on the EUR 20 million that I've mentioned here. Next, looking at the financial trajectory, we needed a starting point. And on 2022, 2023, I wanted to dwell on the various items, which have been nonrecurring but which have had an impact on our results in 2022 and 2023. In 2022, you will recall we had emergency contracts, which were exceptional nonrecurring in this chart, we've restated them with the EBITDA impact of EUR 8 million. The basic EBITDA, EUR 194 million. So this means that in 2023, we had identified 2 impacts where we've tried to quantify this on 2023. Nonrecurring items, the first is the integration cost of STEI. We've spoken about this. IT costs, application system costs, outsourcing costs with Veolia, outsourcing costs on payroll, procurement, which are estimated overall at a nonrecurring impact of -- in 2023 of EUR 2 million. Next, significant impact of energy. You recall that energy in 2023 had index clauses based on 2022. So 2022 tariffs for energy were very high, of course. And this is a nonrecurring item. Well, it's not systematic. In 2022 prices were high. They were much lower in 2023. So there's an impact of EUR 9 million on EBITDA, which has a direct impact on 2023 EBITDA. And these are nonrecurring items. That is not to say that in future, we will not have exceptional items in future. That in future, we won't have indexation clauses that will be positive for us. These are cyclical items, which upset the vision that one has on the adjusted EBITDA or you have to sort of depollute it as it were from these cyclical items. That being said, we come up with a change in the -- in revenues, EUR 986 million in 2023, adjusted for nonrecurring items. Growth of plus 5%, which brings us to EUR 1.2 billion in 2026, which is our growth target. In 2024, there will be a scope effect. We have on a full year EUR 65 million in 2024. It won't quite be like that because in 2024, we're going to solid Essac and Furia in the last quarter. This is estimated at EUR 14 million. The difference between EUR 14 million and EUR 65 million will be a scope effect, which will have an impact on 2024. Next, in terms of operating margin and adjusted operating margin. We're targeting a margin of 22% to 23% for EBITDA by 2026 which means that we have a target revenue of EUR 1.2 billion, which brings us to EBITDA of EUR 265 million to EUR 275 million, which means the average growth of EBITDA will be 9% on that basis. As you can see, this is not very different from our historical trajectory, which means that by controlling our operating expenses, and this will come out even more in the recurring operating margin. We will come up with a growth of EBITDA, which will be broadly in line with our historical level, which is even clearer, shows even more clearly in the current operating income. We're targeting EUR 132 million to EUR 144 million on the basis of EUR 1.2 billion in revenue, which is an operating margin of 11% to 12%, which is a growth rate average per annum of 14%. So significant growth of the operating margin in the years ahead. Of course, this is linked arises from our good management, reflecting our good management and our good control of CapEx, industrial investment, which enables us to have growth in the operating margin, which will be significant. How can we rationalize this current operating income by 2026. As you can see in 2023, we're showing operating margin adjusted diluted of "9.4%." So on the basis of 2026, revenue estimated at EUR 1.2 billion, this would bring us a constant margin at EUR 113 million. If we add improve of underperforming assets with industrial efficiency, the procurement plan, savings plan we come up with EUR 144 million. So the factor by adding the increase of the growth in our business -- estimated business externally. And a little bit conservative, perhaps by adding our action plan for the current operating income, the improvement in underperforming assets, industrial efficiency and the savings plan we come up the factor with the operating income of EUR 144 million by 2026. The second very important item once you've measured profitability over the period, the next point is cash flow. Maximizing cash flow is very important for us because credit is a very important item for the company. We want to keep a robust balance sheet with strong liquidity. There's several parameters impacting the cash flow. Of course, the EBITDA, we've just discussed this. EBITDA is the indicator for operating cash flow, and you have to add to that the action plans, the management of WCR. We have been seen a decline, a worsening performance of WCR with the integration of STEI, cyber attacks, sanitation there will still be impacts by the end of 2023. We're working very hard and our goal of the period. We're looking at '24, '26 to compensate the declining need in WCR. And no worsening of WCR. We're improving it through better collection by 2024 with a normal operation of invoicing, stronger recovery processes for outstanding receivables, day-to-day management with our commercial teams and action plans arising from this. And the second point the stability of CapEx for '24, '26. We have CapEx estimated at EUR 100 million to EUR 110 million at constant scope and on a target basis, this is 9% by 2026 versus to date, 10%, 2023. 7% recurring CapEx to keep our industrial plants up and running. We haven't changed our criteria. And when there are growth opportunities which are profitable, as Franck was saying, in that case, then we invest less in terms of a percentage of revenues, but we have an activity mix, which will be more steer towards services, which requires less use of capital. In 2023, we're in -- we're working order for this since we're going to have a level of CapEx, which will be approximately EUR 100 million by 2023. On dividends. This doesn't have much impact on cash flow. But as you can see on the chart to your -- on the right of the chart, there's been a slight increase in the dividend payments over the period. So the dividend has gone EUR 7.5 million to EUR 8.6 million, arising from the strong result in earnings per share while ensuring that this level of dividend was sustainable over time in terms of cash flow. This now brings us -- once we've addressed the issue of EBITDA of rehabilitation costs, industrial CapEx that we put, EUR 105 million, cooperation tax, WCR estimate is 0. Commitment of free cash flow post all these items above or equal to EUR 250 million cumulative over the period. This is, of course, pre-M&A quite logically. Next, the issue of financial policy. There won't be many new items, but we have to reiterate a strong financial discipline, focused on debt reduction and financial flexibility and strong liquidity. When we close 2023, we'll be close to leverage close to time 3 because of acquisitions made in 2023. We haven't the full EBITDA of 2023 calendar effects because the acquisition done in the second half '23, only 1/4 of EBITDA. So we have a leverage of around 3 with both mechanically linked to the inclusion of annual EBITDA plus cash flow generation, a return to 2.7x EBITDA as of 2024 with strict discipline. That's to say we're aiming financial leverage below 3 within 12 months of acquisition. When there's M&A, we can be on one-off above '23, a return to below 3.0 within 12 months following the acquisitions. The time line that is smooth without any major maturities, no financing peak in the coming years. The liquidity level, EUR 190 million expected at the end of the year. Current debt at EUR 119 million expected at the end of the year and the EUR 119 million, there's EUR 50 million linked to debt that was drawn on renewable facilities for the acquisition of [indiscernible], is set to be financed. And of course, we can always withdraw these facilities because the maturity of these revolving loans, as many of you -- was 5 plus 1 plus 1. Just to recap the growth and financial profitability trajectory. The aim, as you all understand is do the both prudent and geared towards sustainable and profitable growth, the balance sheet that's both liquid and flexible with a growth level given the macroeconomic outlook up of around plus 5% organically over the period, which would bring us to contributed revenue of the order of EUR 1.2 billion in 2023. Profitability EBITDA target for 2023, around EUR 230 million, adjusted operating profit, EUR 105 million, increased adjusted EBITDA, plus 9% CAGR '24, '23 (sic) [ '26 ] adjusted EBIT plus 14% over the period, bringing us in terms of EBITDA between 22%, 22% (sic) [ 23% ] EBITDA between 11% and 12% in '26. Financial leverage below 2.7 as of '24. Free cash flow generation in excess EUR 250 million for the period as a whole. Thank you for your attention.

Thank you, Baptiste and above all, thank you to all of you for your attention. To conclude this morning, I'd like to confirm that the group is well positioned to take advantage of growth opportunities linked to sustainable development with a comprehensive offering for industrial -- the economic players. This morning, we presented some growth focus areas with compelling nonfinancial ambition at the heart of our DNA, our growth ambitions, both in France and internationally. In France, our historic market with circular economy, loops also energy recovery. And lastly, continuous reinvestment in our tools and extended offering in services internationally with our growth platforms continuing to ramp up. All in all, with a strategy of innovation, we also presented the financial growth outlook for the business, sustainable and profitable over the next 3 years. With strong cash flow generation to maintain a strong balance sheet to finance our future expansion in the group, as you know, as we said in my introduction, we do what we say and say what we do, we'll deliver on what we presented to you this morning. Over to you now if you have questions, and I'll ask every speakers this morning to join me.

Nicolas Royot, Portzamparc. A few questions. I'll just limit myself to 3 or 4. The revenue split, how do you view it in 2026, France and international. International is by 30%, mentioned 5% organic. Can we consider [indiscernible] organic growth internationally than the France. That's the first question. Second, possibly on profitability. I've understood the math on operating income, 9.4% estimated in '23 to grow to 144 in '26. But just to move towards a service mix isn't that 9.4% today doesn't maybe reflect the mix in '26. If you understand my question, otherwise, I'll reformulate it. And on R&D, can we have an idea in a number of people working in R&D at Séché? Maybe just one last question on effluent treatment plans to understand, does Séché do the engineering construction, but do you own the facility? Just wanted to clarify that.

Thank you, I'll begin and hand over then to Baptiste followed by Sylvain. So internationally, we've understood at least for greater international, we did some M&A deals now. We have strong territorial coverage. We want to use these platforms as growth platforms organic, essentially we're going to use our expertise or know-how to support local needs, local industrial clients with strong proximity. We'll do a lot of organic growth. And then the quantified target, I'll let Baptiste pick up on that. So internationally, you're right, we're expecting growth that will continue to be strong. And in the plan, we indicated we're expecting an international share at 32% in 2026, given the acquisitions done we were at June 30, we were closer to 27%. And R&D, we have 20 people working in partnership with great many institutions. We have an R&D budget about 2% of revenue. Sylvain, do you want to add anything?

What I can say is that since the R&D center was set up. We saw a photograph during my presentation. Since 2017, we have a new R&D center in -- we tripled the headcount, as. Maxime just said, we're 18 people working currently in R&D, our own staff, but also people who are [ seconded ] from academia to conduct the various projects presented. Franck?

R&D, I think what's interesting to note is the [ import ] on a day-to-day basis on a process, a lot of development, a lot of improvements to make, the young engineers working with us on the ground in the field that's important too. Your last question on industrial effluent treatment, they belong to our clients, and we were on a service contract basis.

I think Franck answered, we just have an additional scenarios when those facilities are on our own industrial sites, then of course, they belong to us. Have we answered all your...

Yes, there's the EBIT, but I'll answer. So the issue is ultimately, given the change in services and given that overall service is less capital intensive than the other activities. Can we end up with an EBIT level that is distorted versus 9.4% given better profitability linked to the fact that there's less to appropriations to amortization and the growth of service activities. The question, no. We've already factored -- it's less capital intensive on target margin levels that are lower than such as hazardous waste management, even if it's 9.4% doesn't really -- not representative in terms of activity percentage, it's overall over time. We can up the level of EBIT. Of course, it's midterm. We're talking 2026. That's the day after tomorrow. So as to offset the EBIT level that we might be led to reduce as a percentage of revenue on other activities such as hazardous waste management. Have I answered your question?

Yes.

Arnaud palliez from CIC. I'll try and limit myself to 3 questions. The first, on your contractual policy with industry and just to measure the sensitivity of revenue to the economic cycle, these contracts are systematically indexed on the volumes treated or some on a lump sum basis or provide for a minimum in terms of revenue? That's my first question. Next, when you develop a new circular economy process, let's take bromine, bromine regeneration. On what IR basis to operate, what market size? Is there a minimum addressable markets as you to -- before you decide to invest. That's the second aspect. Could we have -- on bromine regeneration, how much that represents today in terms of revenue? And lastly, the final question on how you conduct your M&A policy? How do you identify targets and we understand that you're going to use your current platforms for organic growth internationally. But in your 2026 plan, do you wish to open up new geographies, new countries?

First, on the contracts, well, obviously, we had very different contract types between a treatment processing service contract, not the same service contracts duration, 1 to 3 years with revision schemes on index-based linked to inflation, either wage inflation or raw materials and services, they tend to be longer-term contracts, 3 to 5 years, even more when there's investment that's carried by the group. There, we negotiate with 2 items, a fixed portion that guarantees the reimbursement of the CapEx and the duration of contract and a variable portion that's linked to the industrial activity that can be either flows, effluents or tonnage quantities. For bromine, on revenue trends, we're looking at a trajectory between EUR 5 million, EUR 6 million sales included in 2022. We're at the halfway mark. We doubled capacity this year, and we're here on a contract that's longer, 5 years with our first contributor. On the supply and recovery, it's a closed loop with both incoming and outgoing.

As regards strategy on the M&A front, in fact, we remain in continuous watch mode to see if there are opportunities with either the acquisition of new skills, new expertise, new technology or to supplement geographical coverage to state. We haven't -- we have no sufficiently advanced target date to disclose. And we have, of course, we apply major financial discipline for M&A.

IRR, there was a question on the IRR. It's a good example because it's precisely the case that was mentioned by Franck in the -- it's no different from another development CapEx when there's a development CapEx. We have a BP that's presented, which we prioritize all the development opportunity. Part of the development opportunities, we had to secure the incomings and outcome with prices and being conservative, given uncertainties, contingencies, et cetera, how much it could generate. So we have an IRR. We compare that to our work. In the current case, we were on an IRR double digit. So there was no major question mark. But of course, on that, we're specifically cautious, given the associated risk that is raw materials, price volatility, the ability to operate because these are very cutting-edge technological skills. So -- and we're not copied in this field. Logically, it's over time. Well, over time, that was hoped even with a slowdown that was factored in, in terms of risk potential, we arrive at double-digit IRR. So we decided to go for it given the envelope of development CapEx that was available, as mentioned previously.

I'd just like to pick up on M&A. Just a quick point on M&A. We see clearly that we have a very dynamic M&A policy of late. That was mentioned. The priority is, of course, integration and transform these platforms with significant developments. So we have priorities. We remain in watch mode. We always have our ear to the ground to track opportunities, but we have our work cut out for us going forward.

First question on the use of recycled products. You spoke about an increase of 17% since 2020. Do you have a specific target for recycling? Next, industrial water, you said that this is a very dynamic market, not really outsourced, only 15% outsourcing. Do you have any figures on the growth of this market? And what is the degree of outsourcing and to get into the market, are you considering other acquisitions, EUR 100 million is a bit less than 10% of the group revenues. Do you have ambitions to go beyond that? And the third question, looking at the margin -- the mix and the margin, EBITDA and gross margin, could we hear a bit more about the contribution of France and international business. France has very high margins, 24%, 25%, a bit less last year. International was around 20%, a bit less due to acquisitions, 16% in the first half also the -- what is the margin for improvement here? And what is the margin mix for 2026. And to respond to what Maxime said, EUR 150 million minimum of free cash flow by 2026. How do you envisage the reallocation of free cash flow. I've understood you focusing more on organic growth, but what will be the allocation of free cash flow between now and 2026?

Right. In our water efficiency, we emphasize reuse, reuse of rainwater to reintegrate it into production rather than using a water table -- water or from other networks. And we have reuse through other processes. At present, we have a strong increase of recycling volumes with other processes with the activity of STEI rolled out at group level. And by 2026, reuse of our processes is the main driver for reducing our water consumption, and we are targeting doubling of reuse by 2026.

I wanted to say a few words about the implementation of the water efficiency plan of the government here. I underestimated our team's enthusiasm for this. We established a project quite quickly and we went from 1 to 40 projects. These sources of cost savings really means something to our teams and what emerges is a lot of proposals and ideas. And this is very interesting. I think the societal aspect and the teamwork here are really key.

On industrial water. Well, the momentum of the market, the increase in the outsourced part has growth of 4% to 5% per year estimated and with the issues of reuse, we should be above that. And this is an important driver. We're seeing more sort of request from our industrial clients, which we didn't have until now. So it's moving in the right direction. Regarding growth, I think, in France, we have market presence, which is very -- market share, which is very significant. We need to digest that. We need to rationalize and optimize it. And growth, I would see more internationally but of course, I don't want to be answering instead of Maxime on that.

So what do we have -- we put EUR 120 million into the development plan on margin between France and international business. We're not changing our strategy. You're quite right, we are continuing. We enjoyed when we had 20% margins internationally, we had very -- were exceptionally large contracts arising from the flooding floods in South Africa with the Spill Tech work and in Peru the Lima [indiscernible]. So 20% margin was underpins structurally. So we're not changing our strategy. We're still targeting an increase in the margin to achieve 20%. And to follow on from what we're saying this morning with synergies, the fact that we are going up in the value scale in South Africa, and we're continuing to see [indiscernible] an improvement in margin on international business. In France, there are 2 aspects to take into consideration we're coming to significant levels. We have room for maneuver to improve operating margin. We've even put figures on it, EUR 9 million for Europe and there's some headwinds arising from higher inflation, increase in payroll, increase in spare parts, maintenance costs, which will have an impact on our brands. So we're not looking at lower margins, but in -- among the drivers that improve our operating margin. There's the international business, which is still a significant driver. We're not changing our strategy. And we think we can also improve the French business margins and reallocation of free cash, Maxime?

Well, it's important for us to generate cash flow. Having said that, there's no specific target identified for the time, but we're always reinvesting in our tools and always reinvesting in resources to accompany our growth, be it organic or external. Have we answered all your questions? Yes?

A few questions on my part. Just to clarify on industrial water, your market share is EUR 120 million of the EUR 275 million of the market. So it's approximately 1/3? Looking at free cash flow, I didn't quite understand. EUR 250 million is the accumulated amount after the dividend. So the question then is what's the dividend? So is the policy as a regular increase in dividend payout? Have you integrated stability and dividend payments in the EUR 250 million?

We've included different impacts and dividend payout is part of free cash flow. On our dividend payment -- dividend policy as such, per se, this is a rise -- is linked to EPS in recent years in the slide that you -- I don't have the number of the slide, but you have the trend in the dividend payment, which is linked to the earnings per share, the trend in earnings per share, which has been very significant. So the dividend has gone from EUR 0.95 to EUR 1 and to EUR 1.10. If your question logically is what will happen on the dividend, and we're going to be pragmatic in terms of EPS and free cash flow. For example, in 2023, logically, given the amount we've announced as the EBIT -- expected EBITDA, this should logically lead to an increase in EPS for 2023. So naturally, logically, we will be proposing to the Board and to the shareholders meeting a slight increase in the dividend, in line with what we have had in previous years while enabling us to have a sustainable dividend payment in terms of investments in cash flow.

Two other questions. [indiscernible] on the PFAS, we are still looking at research for the time being. When will that be part of the Séché offering. And next on lithium, what are you targeting today? Are you targeting the management of waste arising from recycling or for battery production or from the extraction of lithium. But you are not in the recycling proper of batteries where you have many projects that are underway, but you're not yet active in terms of recycling the actual lithium battery.

So to answer, fluorine, at present, the work has started in 2021. And on the 3 themes that I outlined in the first part, which concerns our plant capacity to destroy fluorine, which is going to go quite fast because we already have results in our factories. And what we're doing is [ DEDRE ] which means that we measure the degree of depollution of these substances. In other words, we inject into a plant, an established quantity of fluorine looking at our oven, furnaces, and we have technical guides, which enabled us to say on what basis we can efficiently destroy it. And the percentage we've achieved destruction efficiency, we have to achieve 99.9%. But when you look at the inputs and outputs in terms of gas flow, we have to achieve 99.999%. So we already have results that show this efficiency level in the initial plan. So we have to continue, of course, because looking at the topology of the plants, this technology is only applicable to 1 plant. It has to be rolled out to others, and we hope to have the best possible results as good as what we had on the first plant in order to be able to respond to new markets, and we're looking at water management when new sequester, the perfluorine in water. This is done through active coals, which will concentrate the pollution and we have potential markets during 2024 on those businesses. Now of course, on soil and water. As I said, there's some work that's underway on depollution but on the water part, this is long-term work. And as I was saying earlier, existing technology is more absorption technology. And what we want in future is concentration of perfluorine and then break down in order to have the waste -- hazardous waste part will come in 2024. And then after that, gradually, the other effluents will emerge. On your second question, lithium, for several years. We've been working on these markets. We're working both on what -- the primary batteries, lithium non-rechargeable batteries and then you've got the cells, the fuel cells and the batteries that are rechargeable. So we already have contracts on that portion where we were not necessarily going a recycling route. But as things evolve on the regulatory standpoint, I said with recycling levels that will be posted as of '27, 2030 and reincorporate these the lithium into batteries. We have a number of potential markets. Firstly, as I cited, the portion on batteries, end-of-life batteries gradually, depending on the utilization rate of EVs as of '27, '30, we'll have growth markets on recycling these end-of-life batteries. As I said, in respect of the emergence of giga factories in Northern France, we're going to have some air flow coming to us as soon as those plants are operational. We also have the market -- on the electrolytes, electrolytes in lithium ion batteries, you have a chemical that insures electric conductivity, [indiscernible] electric current transmission, power transmission and the chemical companies to recycle the lithium portion and as I said, as part of possible mining operations in France, we also have plants who are interested for that portion. The goal being to work on end-of-life cycle batteries, but across the lithium chain, production as well as manufacturing residues. I hope I've answered your questions. Further questions?

I have 3 questions from my side. The first, in terms of the fact that you mean an activity in metallurgy and chemicals follow during the course of '24, shouldn't we expect for that to be renegotiated by your clients who are affected by that economic slowdown? Second question, concerns the water segment. I'd like to understand, you have a technological expertise, a tech offering in the water segment or is it just design, build maintenance operations? Do you have technologies in this segment to offer because you mentioned membranes, ozone, you mentioned the UV technology. Why is the reason that accounts for that? And my third question concerns possible synergies between your legacy offering and water offerings. Is there is a reason for certain clients avoid to be overly dependent on Séché regarding waste treatment by picking a complete waste solid, liquid offering.

Answer on your first, the slowdown of our clients in chemistry and metallurgy, there isn't so much price renegotiation. It's our ability to saturate our tools. As I said earlier, we're fortunate in having a volume of ways to manage that exceeds. Our processing capacity, when there's part of the business, it slows as announced by plants. Currently, we're asking them and their production capacity next year to draw up our load plan for furnaces and scheduling. So it's our ability to implement an alternative solution to reinternalize our flows. We're not thinking of reducing our prices. We don't want to secure those volumes, absolutely because we can plug the possible gap. As I said, we're really increasing our processing prices 3% to 5% on hazardous waste. Next on the industry and the risk of the choice of the client who doesn't want to be caught in our comprehensive offering. Well, our offering is off the shelf. It's a choice that we're not imposing anything. Either the client has the strategy to limit his number of suppliers and the fact that we can offer them a full change of management, traceability of waste, both internally, water waste management and our treatment value chains, either rebuys that or is in purchasing segmentation strategy. We're not imposing anything, but what we're seeing are existing client portfolio where these services don't -- can generate additional demand because we're creating a new offering on the comprehensive market. And if you source the market, we don't have that many competitors offering such a range of services.

On the technology, well, fortunately, today, we can do engineering and build without having our own tech. There's a lot of technology available in the market. The example I presented to you early where you have a stack of technology, membrane, active, cold biological treatment. So today, no difficulty for us to build tech solutions and to access the technology. On that the markets open. There are great many suppliers in Europe and elsewhere. So I know we're on a deal. We have to replace critical equipment for a client, and we found 3,4 suppliers. So no difficulty today on that front.

I would add that within STEI there's a technical department very well represented. 30 cutting-edge engineers providing differentiated service to the client that's widely appreciated.

The landing point, please, for the service activity by 2026. It's -- there's a ramp-up, but it could also generate high growth of EBIT versus EBITDA. EBITDA are less capital. What would be the mix service by 2026. Second, average EBIT/EBITDA growth given rate price inflation, we can have the projection, the forecast average net income group share. It will help us for the dividend. Final question, more short term, slightly more unpleasant landing point, 2023, EUR 1 billion, 100% organic, a marked slowdown in Q4 versus 7, 8 months, 8%, [ 9 month ] your comfort into '24, '25, '26, '27, '28. Why is that growth more sluggish? That's not a non-kind question in any way.

So first on service. So be careful in what was factored into the presentation. We're already on a pro forma, including STEI and we've also indicated what the target was with slightly stronger growth on the water segment because we indicated the EUR 100 million. All this leads us when we do the math to grow by 1.5% to 2% through 2026 on the service share side 2026. It's not a fundamental distortion of the split in the various activities. On the [ PS 326 ], well, I'm not going to do your job, but fully either because we're going to be nice today, knowing -- as I said on the results, financial results, we got -- we have a cost of debt that's broadly stable over the period linked to the fact that we're a fixed rate and refinancings have taken place, so it has but a marginal impact on the tax rate we're looking at a corporate tax rate that's broadly stable. There will be a slight cash flow impact once we have exhausted all the [indiscernible] assets, the DTAs as a 2025 and that would have been captured by the overall change in the accumulated cash flow for the period '24 through '26. Next, on the kind of the more sluggish or softer part on Q4, we had already back in 2024 -- Q4, that was very strong versus Q3 versus Q2 versus Q1. So we're looking at a basis of comparison, that's very strong. Then they factor the Q4 revenue numbers, not very different from the Q3 revenue number, not that different from Q2 revenue in [ years ], less impacted by revenue peaks as we experienced in '22 and in earlier years.

So there are a few questions that are coming towards from [indiscernible]. These essentially questions are concerned -- nonfinancial performance. I'm going to call Pierre-Yves to speak to those. From [indiscernible] from ODDO BHF, there are a few. There are 6 such questions, concern the one hand. GHG emissions greenhouse, why is your target just focusing on the French scope? How representative is it in the group emission? Second, on the capture of biogas and facilities. Do we have a target level in agreement with the total reduction plan for -- by '26?

So the group's commitment on the French scope, scope 1, 2. Why that's cut because it's of material importance for the group. It generates 90% of the group's GHG emissions. So that's what's being looked at, scrutinized as part of the SBTi strategy in 2022 was 88% to be specific. Why this weighting, which is much bigger than the share of French revenues, because a large part of our processing waste management capacity is in France. We have fewer facilities internationally to date. So that's why at present, the commitment is on the French scope because it's larger. Second point, various levers, various drivers to decarbonize Séché. The capture rate of biogas, limiting the leaks of methane at present, the Séché Group is ahead of other players in the sector. The government says 50% of methane on the facilities. Séché has achieved already 85% of methane capture. This is due to our know-how and our good management of our facilities. So anything that's not released into the atmosphere is reused. So this is a profitable activity. And we want to further reduce the leaks to improve the capture rate, which is already at 85%, and we intend to divide by -- to half methane leaks.

What are the main drivers for enhancing materials other than solvents or bromine or combination of the 2?

Well, our commitment on the carbonization of our clients is based on the capacities we've discussed, solvents and bromine. We've committed with industrial plants, commercial plans that have been presented. On the other themes, which will enable us to decarbonize, we're still in the R&D test phase. So we can't commit to figures for 2026.

A question on biodiversity. What are the main impacts of our operations on biodiversity. Will you adopt the framework of TNFD as part of your biodiversity strategy?

Well, what I should have specified when I spoke about the group biodiversity strategy from June 2023, we did an interesting exercise, which was analyzing the double materiality on biodiversity. So Séché already is compelling companies to have a double materiality on all its impacts. And what we're doing is to ensure that the group strategy is focused on the group's pressure areas on nature in order to reduce that pressure. So we have 5 pressure factors, which is the -- we've taken -- made commitments on each of these pressure factors on biodiversity, using -- reporting an analytical criteria that enable us to come closer to what's being requested by the TNFD body and to be validated internationally, we're working on [ SBTM ], which is the equivalent on biodiversity in order to have the rubber stamp internationally. On the social aspect, we regret that this was not dealt with today. Well, that's [indiscernible].

With your international growth, are you going to announce objectives for occupational health and hazards globally? And further to the presentation made by Franck, on what scope did the slides relate to regarding the frequency of accidents?

Well, this was a global indicator for France and international business. The occupational health policy is rolled out internationally, of course, subject to the level of safety culture is not the same in South Africa and Latin Americas and Europe. But we have this cross-fertilization of best practices and the rollout of all our safety processes and health evaluation of the [indiscernible].

And the last question, have we've done an exposure study on the sites exposed to hydric stress?

Well, overall, we've conducted an analysis on the adaptation of our sites to climate change. Climate has 2 challenges: how to reduce GHG emissions, we presented our strategy. And the second point is global warming for the next 20 years and how are facilities and those of our clients can be adjusted to take into account global warming. And hydric stress is one of the components of adaptation to climate change. So when we conducted this analysis of adaptation to climate change, we worked with the [indiscernible] tool, we were able to evaluate not only the operating impact of the conduct of our sites towards a scenario of plus 1.5 degrees, but the unfavorable [indiscernible] scenario plus 3 degrees to establish the resilience of our sites and our plan is a response to the scenario of adaptation to climate change and to put it very simply, the reporting tools are less advanced on adaptation and we've worked with the -- them in the pilot phase. This is climate reporting. And we're going to be beta testers of this type of application from the end of 2023 and throughout 2024. So adaptation to climate change is an operating environmental financial.

No more questions. Thank you. Well, if there are no more questions, thank you all very much indeed. We're closing, ending Investor Day. And please come and join us for a drink, and we can continue our discussion informally. Thank you.