Solocal Group S.A. (LOCAL) Earnings Call Transcript & Summary

Ladies and gentlemen, hello, and thank you for being with us. Thank you for having accepted our invitation to attend the publishing of our First Half Results for 2021. Before we start today's presentation, I would like to introduce you all to Philippe Mellier, our new Chairman of the Board. And I would like to welcome him, and I will now hand over the floor to Mr. Mellier.

Herve, thank you very much. It is a pleasure for me to be here today. I am the new kid on the block, so to speak. I joined the Board on the 30th of June this year. So I have been here for just on 1 month, but I have been working so much to come up to speed with everything that Solocal does. And I'm feeling quite comfortable. Along with Herve, our CEO, and myself as Chairman of the Board, the 2 of us, we will open up a new chapter for Solocal. Because we are like peas in a pod, in that we are both practical mind, and we aren't one for great promises and big statements, we really want to focus on what the teams want. And that's what Solocal needs today. I held the first Board meeting just yesterday, and I wanted to really breathe a new sense of demanding requirements that is so necessary for the success of Solocal in the coming years and months. And obviously, Herve is fully on board with carrying business forward, and there's a lot of work cut out for him. And he'll tell us about the results in just a few moments. Just a few quick words about my past and my career. I have been the one to rework and transform a major industrial company, such as Alstom Transport, a diamond production company, De Beers, and also a major European leader for industrial vehicles. So as you can see that I have quite a broad experience in a number of businesses and have considerable experience also in governance, in corporate governance, be it in France or in Great Britain. So I have quite a number of qualities and experience from my own career that I will be able to best utilize to help Herve bring the projects to fruition. Herve has considerable experience in managerial positions at high levels in a number of industries. That is so important for us, especially when it comes to focusing on improving our clients in inducing and improving the efficiency of our sales teams, be it Dynapost and Mediapost, Lyreco or Teleperformance. And I think our joint experience work well together, hand-in-hand, in boosting growth for Solocal in the future. Today, we want to focus on customers. We want to focus on the lifeblood of Solocal, be it our sales force teams or our technical teams, our service teams, to be able to create further value in the future, which is so important for you, our shareholders. We spoke about a number of key points in our press release. And with Herve and his teams, we have been really working tirelessly to come up with a 3-year strategy for Solocal, as a group, so that we can create value that benefits our shareholders and which will help grow our company. That is our top priority. So those are just a few introductory remarks that I wanted to share with you today. Obviously, I will be here for this morning's presentations. And I will now hand over the floor to Herve to present the results.

Philippe, thank you very much. So what are the key messages that we have for the first half of 2021? So as Philippe just mentioned, we have a number of changes in management and governance over the past few months. I won't go over them again. There are a few major points that I want to focus on in terms of 2021 and business. First and foremost, our revenue in Q2 is stable compared to 2020. And that is a positive sign that we're seeing there. What that shows is that our business model is starting to bear fruits and to be in a virtuous cycle. Because of that, we can now have end of June landing in 2021 with revenue, which is only back 5% compared to 2020. We also have a client base, this is the second point, a client base that is stabilized for the third quarter in a row. Now I don't think it's really worth going back over the churn that we had to deal with over the past few years, but I think this is just a positive sign that we have a stabilized client base. I think it's such a fundamental point. And because of that, we will be able to have better forecast for growth in the coming weeks and months. Underlying all that is that we have an overall decrease in churn rates. Obviously, we can focus on the fact that we have good KPIs that show that. We also have stable ARPA, ARPA which is in line with our business forecasts. Olivier will tell us more about our landing just a little later. But what I could say is that we can see is that we have an overall gross margin of 89% and a 26% EBITDA margin at the end of June 2021. So to conclude. To talk about the business model, overall, our subscription-based business model, it is supporting the robust nature of our business portfolio and our income. We have investments in terms of customer service which are really starting to turn back a positive return on investment, be it in terms of customer retention rate, churns, customer satisfaction. And yet there are still many challenges that are yet to be overcome, and we will strive to overcome them in the coming weeks. So that is what I wanted to say to you as just a few introductory remarks for the presentation. What I would now like to suggest is that we focus on our financial results. For that, over to Olivier.

Herve, thank you very much. Hello to each and every one of you. Throughout this presentation for the first half results, there are 4 key items to bear in mind, as Herve mentioned. First and foremost, our revenue. It's stabilized in the second quarter, which meant that we were able to limit the overall drop of revenue. And we limited it from going from minus 10% to minus 5% for the first half. And this has been a number of years that the Group hasn't been able to stabilize its revenue, but we have managed to do so. Also in terms of its secured revenue, we will talk about this at greater length a little later on in the presentation. EUR 365 million as of 30th of June 2021, this is compared to EUR 388 million at the end of June 2020. Moving on EUR 56.5 million in EBITDA in H1 2021, now this is back compared to H1 2020, but is strongly up compared to what we saw in the first half, overall, as 2021. This is predominantly due to the impact that we saw from government assistance in the first half of 2020 that was nonrecurrent items there. And that has a positive impact for 2020, which we currently compare to 2021. Also positive cash flow generation in H1 2021, which means that we've been able to have good liquidity levels, EUR 71 million in all. Also, you would have seen in our press release that we -- that came out in July, we were able to pay back some EUR 6 million in RCF in -- and that's planned, sorry, for September 2021, EUR 3 million in cash, EUR 3 million in stock. Let's now look at some of the main revenue indicators. First and foremost, let's just have a few reminders. Our sales, that is something that we calculate in terms of order intake and -- order intake. So we see that the impact of that is something that can be calculated over 12 to 18 months. So when we want to look at revenue, this is actually a reflection of past business, but doesn't reflect current business. Order intake, it tends to represent just an overall dynamic, a sales dynamic. And that's what I want to say just as a forward before we get into the heart of the matter. So let's now look at order backlog. Order backlog for June 2021, it's actually 5% down compared to 31st of March 2021. This is under what we expected, and this is what we released in the press release on the 29th of June this year. So because this performance is under our expectations, this can be explained by 2 main reasons. First, and Herve will touch on this a little later, is that we faced a number of difficulties in the field by our sales teams because they had to adapt to a business model that was on acquisition-based as opposed to renewal base, which we saw in previous years. The second effect is because we had a third lockdown in the month of April, where schools were closed down for a part of the month, which had a negative impact on our sales. That said, we have a number of positive items I could focus on. As we said earlier, stabilized revenue, and you can see on the bottom right there, this is -- we have a number of quarters where we haven't been able to have a solid, stable revenue, but we are finally getting there. We also have a penetration rate for our subscription-based model, which is represented by about 87% of our audits. What that means is that we have much more visibility for the coming months in terms of revenue. And lastly, thanks to our sales, we have 26% extra of revenue for the coming 12 months compared to the past 12 months. As I'm sure you're all aware of, we look at a key indicator, secured revenue for the year. Now let's just look at what that means. Not many businesses do that, but we do it because it gives us good visibility for annual revenue. So the way we calculate this is by looking at revenue, revenue for which we are certain, revenue that will definitely come in over the year. Now this is not taking into account any acquisitions or any contracts for which the renewal is set to come during the half, but which didn't, wasn't actually reviewed. So when we look at that, we have revenue of EUR 215 million and order backlog of EUR 266 million. And what that means is that we have a revenue conversion for the next 6 months of EUR 150 million. So that gives us an overall secured revenue of EUR 365 million by the end of the year. Obviously, if we also take into account all of the renewal -- contract renewals that will come into effect during the second half, these are automatic renewals I'm talking about, then that figure will obviously be much higher. Secured revenue is actually a little down compared to last year by EUR 23 million. But that means because of the 31st of March, it was actually down EUR 52 million. So what that shows, we are dropping the -- we're lowering the gap. And that shows that we are moving closer and closer to a more stabilized revenue. Now let's look at a business-by-business breakdown of revenue. So Solocal, for the first half of 2021, is still considerably hit by the drop in sales. The drop in sales that we saw in 2020 because of the health crisis. Our order intake dropped by about EUR 110 million from 2019 to 2020. So in the first half of 2021 and the first quarter reflect that drop in order intake, which had a delayed effect on our revenues. Our products can be broken down into 3 ranges. We have Connect, which is our digital range. We have our Websites, it's aptly named. And also, we have Booster. Booster is for all of the digital advertising business that we have. So those 3 businesses changed quite differently over the first half. Connect, up 18.6%, which is quite considerable. So that's up compared to the first half of 2020. We also saw that there was quite an interesting change there for our Websites. And also, we are starting to bear the -- to reap the benefits from all of the work that we did in 2019 on completely overhauling that business line. And that was for Booster. But if we move on to Websites, Websites is a little back compared to last year. I'm sure you can all remember that 2020 was a year that was considerably hit by the fact that we had our sales teams that want to show off how to sell that specific offer. But that is completely behind us now, and Herve will touch on that a little later. Another point that we can touch on is that in the first quarter, first quarter had a nonrecurrent item that impacted our revenue. but that has been restated, which means that we're actually slightly up in terms of revenue for Websites. Booster is still down 12.4% compared to last year. And what that means is that advertising budgets are limited, and our professional customer bases have chosen to drop the advertising budget, but that's obviously because the health crisis has been becoming more prolonged. And I think this is perfectly reflected by the fact that a number of our customers had to close our business for a short or if not a long time. And that has had a drastic effect on the overall advertising budget. And this is why our EUR 215 million drop for the first quarter of Q1 2021. So how does this all affect our EBITDA? Well, I'm sure you all remember, H1 2020, EUR 74 million, now that's compared to EUR 57 million this year. So why is there such a drop? There are 2 main reasons why. I'm sure you remember in Q2 2020, as part of the first lockdown, the government put in place a number of financial assistance packages to help companies pay those employees who were on short-term contracts or partial unemployment. So we were able to utilize those subsidies, and we got EUR 13 million. That's EUR 9 million in personal fees. But also there are a number of indirect effects because, for example, a number of these employees who were laid off just for a short amount of time, they weren't attending seminars, they didn't have any fees that they had to claim, so that's why we also saw a drop there, negative 13%, nonrecurrent. So therefore, the overall basis to compare these 2 doesn't quite pair up because, again, these were nonrecurrent effects. We also saw a drop in order intake for the first half of 2020. And this is why we can see that it had an impact on the following quarters, which means that we, overall, have a drop of EUR 12 million. And in gross margins, down EUR 10 million. But aside that, we were able to have a positive impact on cost savings to have a positive EUR 6 million in cost savings. So therefore, when we compare the 2 different rates, we have been -- we now have recurring EBITDA H1 2021 which actually reflects all of the elements that I just mentioned to you. If we now look at our profit and loss in greater detail, you can see that there was a drop in revenue, which is reflected there. But also right down the bottom of the profit and loss, we have all of the sales and divestments that we had, for example, Mappy and QDQ that came into effect in the first half of 2020. And also, we have the sale of all of our Print business, which had an impact in 2020 as well. So that means we have an overall drop of 5%, as we said, recurrent EBITDA down EUR 56 million. We have nonrecurrent items, which are actually positive, for the first half of 2021. So these nonrecurrent items what this is, for example, the provisions that we had to put into effect for the 2018-2019 redundancy package, which we are paying out just the last installments of that, which meant that we have an overall operating profit of EUR 34 million. So financial results is considerably down with financial costs of EUR 26 million in the first half of 2020. And we only had EUR 14 million in financial cost. So why is there a drop there? Well, I'm sure you remember, financial restructuring, that meant that we could drop the nominal part of that, quite considerably. That was one reason why. And also the coupon rate, which was dropped from 10% to 8% for most of our debt. So because of that, we have an overall consolidated net income for H1 2021 of EUR 11.5 million. Moving on to another item. I'm sure you remember that we made a commitment to drop CapEx by EUR 44 million -- from EUR 44 million to EUR 35 million, and we have done it. We have been able to drop it by -- from EUR 22 million last year to EUR 17 million for the first half. And all of our investments are focusing -- we have been focused on our strategic areas. Now another key feature for this half is that we have been able to stabilize our cash and -- cash flow and cash generation. So over the past 2 years, the past 2 years that I've been here, this is the first time that we have been able to actually generate cash over one half year. So we've been able to generate cash despite an EBITDA that is dropping. But how so? Well, this is because we have been able to work on our working capital requirements. And I'm sure that you remember that the WCR for receivables -- for customer receivables is actually quite an important factor here. So the WCR receivables is a key reflection of our sales activity. And you can see it in the first half of 2020, the WCR receivables was EUR 50 million down. So EUR 50 million, that reflects the overall drop -- a massive drop in order intake that we saw in the second quarter of 2020. But then that stabilized in 2021 for the first quarter. And that is the reason why we have been able to double the overall cash flow for recurring free cash flow from EUR 17 million, up to roughly EUR 34 million. That's because in the half, we paid back EUR 10 million for -- that we had to owe back to the government. And we have EUR 9 million remain to be repaid between now and the end of 2021. In terms of nonrecurring items, EUR 7 million in this were dispersed in H1 2021. Where does that EUR 7 million come from? Well, it comes from paying off the redundancy plan from the 2018-2019 redundancy plan. Now EUR 7 million, that's not the main focus area. The main focus area is that we have still EUR 3 million to be repaid after 30th of June 2021, EUR 225 million for the company. So really, that's showing that we are at the end of the tunnel. And then I'm sure you can all remember that in the others line, we also include the IFRS 16 cash impact. So it is rents for our head office and also for different sites around France, Bordeaux, Rennes, Angoulême, these are our main sites. And those are covered in the others line, and that represents roughly EUR 10 million per quarter, so just under EUR 20 million -- sorry, EUR 10 million for the half, EUR 20 million for the year. And that means that we have a net cash of EUR 71 million as right now at the end of 30th of June 2021. I'm sure that you saw, quite clearly, at the beginning that we are going to continue as part of the partial repayment of the RCF, as announced in the financial restructuring plan. So we wanted to pay back part of that between EUR 5 million to EUR 10 million, 30th of September 2021. The same will happen again in 2022 and so on and so forth. So we were able to choose what amounts we're going to pay off between EUR 5 billion and EUR 10 billion, and also how we're going to do it, either it is cash or in new shares. We chose to pay back EUR 6 million, EUR 3 million of which is in cash, EUR 3 million in new shares. So the calculation of the number of shares to be issued will be based on the weighted VWAP rate from the August to September period. So the overall RCF is now at EUR 4 million, end of September 2021. One key item, this is the first time that we actually pay back our debt in cash. About EUR 3 million doesn't look like much, but it is a strong signal we're sending. Now regarding the financial structure at the end of June, so prior to the reimbursement of the EUR 6 million, we have a gross debt of EUR 258 million cash, EUR 71 million. So we have a net debt of EUR 187 million. And the leverage ratio, that is EBITDA over net debt, as defined by the banking regulations, a multiple of 2 times 3 -- 2.3. The ratio between EBITDA and the financial interest in 12 months is 3.3. That's the interest coverage ratio. So we have to move -- room for maneuver, what is known as headroom, at end December 2021. I'll give the floor to Herve now, who will give you more details about the business as such and the trends as they appear.

Well, thank you, Olivier. So regarding the business review, let us look at 6 highlights in the first half of 2021. Four items are to be mentioned. First, we have a customer base -- well, a stable customer base for the third quarter running. I'll get back to that in a minute. We have confirmed a significant reduction in churn. Now there, we are ahead of our plan so, so far, so good. ARPA is in line with our expectations, and our renewal base is growing. At end June 2021, 89% of our clients have decided to go for subscription. That is auto-renewal. Now there are 2 items I would like to draw your attention to: number one, where client acquisition is a challenge, and I'll get back to that in a minute; and then the PagesJaunes readership has been challenged as well. Now that's in terms of single visits. But it's not just that. We also have a regulatory context that, that has changed recently back in April of this year. Now regarding the customer base, what does it look like? Well, it's stable at 314,000 customers, that base. And indeed, this slide will draw your attention to 2 things. Number one, we have a good way of halting any sign of decline. Churn, in particular, was significantly down compared to 2020. Significant efforts were made by our teams to make sure that our customers remain loyal, especially our distance salespeople. That win-back, that is getting all customers back, is working as well, and we will be investing there as well. Now so these are the 2 strong points, win-backs, up, churn down. But what is not satisfactory is acquiring new customers, the volume of new customers that have been obtained as it were. We only acquired 4,000 new clients -- customers in H1, and that is not satisfactory. And that is where we really need to work for -- in the weeks to come. ARPA, as I said, is right on track, in line with our expectations. Now then another indicator, and that is a similar trend, it's a positive trend, both in terms of churn rates. So that churn rate was down, but also retention rate is up. Churn lending at end June is 13.9%. And you have to remember that at end December 2020, it stood at 19%. So a significant effort, again, was made there. Churn can still be improved. We can bring it down. I think we can gain a couple of points in terms of churn. But the point here is that why -- and why it is that people leave us or why do they stay. At Solocal, 60% of churn is due to the sale itself. That is upstream in our customer journey. This is where people turn away. So it means we have to train our sales people. We have to -- they have to be able to educate our customers, our prospects. Maybe it looks -- maybe the offer is too complicated, and that may be why people sort of tend to shy away. It is essential for our customers to understand what it is they have purchased and how it's going to work for them. So that's why people turn away. Retention works well. I mean 54%, I mean, it's already well, by the way, to be able to retain a customer. But it's even better to be able to hang on to that customer's associated value because, of course, it's not just that people are still customers. They have to bring in business. And so what we have to look at as the revenue brought in by individual customers, at least those who initially said they were thinking of moving away. So it's not just being able to keep them, to retain them, but also being able to keep revenue from them. So I said there were 6 highlights here, and there's 1 which is a significant change in the regulatory context. And that is the way in which we work out our audiences on PagesJaunes. Since December of last year, the French authority CNIL has published a number of directives regarding the protection of privacy, especially private data. So how does -- what's the consequences of that? One thing is that from now on, we will not be in a position to consolidate audience of our partners using the -- well, the third-party cookies. Third-party cookies are still allowed, but -- and this is a big but, customers -- I mean the web surfers have got to give their explicit consent. And so that makes it very difficult to work out of audiences because we haven't got the wherewithal anymore. Now is that an issue? Is that a risk? Well, this may surprise you, but I think this is a great opportunity. Why? Well, PagesJaunes is a great piece of media, but it is a very powerful search engine and a very relevant and focused search engine because it is out there to search your local answer. And indeed, queries and searches may well be the key indicator when it comes to working out the effectiveness of PagesJaunes. Now we are now in a position where we indeed can track searches. And in fact, we -- this is the new indicator as opposed to actual visits. So searches now, searches, you should note that this is, of course, this is not a PagesJaunes monopoly. This is not an exclusive item. All the search engines have been monitoring searches, both the searches or requests. I mean Google is, of course, the #1 provider, and it publishes its numbers on requests and not on audiences or visits. That is what it reports on. And so on a pro forma basis, if we look at H1 2019, H1 2020 and H1 2021, what can be monitored here is the activity of our PagesJaunes search engine, see how much it has been used. Now well, it looks as though it's improving, but make no mistake, the 2020 basis was highly favorable because we are right in a lockdown, you had closedowns, I mean, especially shops and restaurants. And that is a critical aspect of our business in PagesJaunes. So of course, we can be content, I mean we can be happy with an improvement on that, but the comparison basis, of course, isn't right. But I mean that is our own improvement. But vis-a-vis the competition, now there is an improvement in performance. And you can see that the SIO work we're doing and the work we're doing with Google has brought us to that level of performance. Now the various indicators have been mentioned earlier, but let's focus on 3 themes which, to me, are highly representative of what we've experienced in H1: Websites; large accounts; and the enterprise sales force. Websites. Websites is a fundamental building block for the Digital services solutions. We have 3 offers: the entry level; then you have a Premium, and that is where you have the largest numbers; and then Privilège, as we call Privilège is the high-value, high-end offer. So this site -- website offer has basically 2 underlying principles. Number one, onboarding, I mentioned this during the AGM. You may remember that we shall make no exception. Whether this be a Privilège, an entry level or high-level site, we will be onboarding our customers. In other words, we will make sure that we will see them through the publication of their digital window. This is fundamental. We will not discriminate against our more modest customers. That's number one. And then there's no compromise between content and the technological solution. We -- some will focus just on content, others on the technological solution, but our ambition is to deliver on both fronts. We want to provide an end-to-end solution which is ready to use, which is ready to go for our sites. I mean we have to offer a turnkey solution. Now why are we focusing on sites -- on websites? Well, as Olivier said earlier on, we did encounter a number of challenges in the area -- in this area. Having said that, what's the profile of site owners at Solocal? Well, number one, 80% of Website customers have at least one additional product. I mean, if it goes to show, on top of the Website, which means that the Website is a huge penetration weapon. Number two is ARPA. ARPA now stands at almost twice Solocal's standard ARPA. So a huge indicator there. And then Digital customers, people who go for the Website, are key players in Solocal's ecosystem because they use -- I mean with our Solocal Manager tool, they use 30% more, they make a 30% higher use of all our tools available on the platform. And so this reflects the ease of use. And indeed, we want to make sure that our customers' satisfaction in this respect, that is the ease of use of our platforms is key to our plan. So what have we done about it just to make sure we do provide this level of satisfaction? Well, number one, we want to make sure the Websites, we have a tunnel effect for the customer. And the tunnel effect, of course, is -- brings with it a huge risk of people pulling out, of canceling the whole thing. And so when -- and this is why we have to make sure the lead times are as short as possible because -- during the question, the uncertainty period, people might pull out. And then, of course, the sooner that we go online, the quicker we recognize the associated revenue. So it's, of course, our own interest as well. And then we also had to improve -- increase our capacity. We were looking at 1,000 premium sites at the end of June. And we got to 935, so we're pretty close to the target, which means we're just about doubled on delivery numbers compared to Q1 -- from Q1 to Q2. But of course, you also have to know that this -- the website has become the site where people move up from Premium to -- from Essentiel to Premium and from Premium to Privilège. In other words, this is where people upgrade their offer. So we do need to push that. Now in the first half of this year, we found -- we've found a number of limitations. We found it difficulty to keep progressing in terms of new customers. We have what are known as Hunters amongst the full-time employees. Of course, when things started off earlier in the year, we found that in Q2, well, we found that the transformation rate was rather disappointing because we need 6 appointments to sign 1 contract. And in this business with -- where the customers are small companies, if you target your customers right, normally, you should be able to have 1 transformation rate, 1 transformation or 1 contract signed for -- with only 4 appointments. So we stood at 6 appointments. So the performance point was -- I'm not saying our Hunters are no good. But it means we need to train them better. We need to manage these people better because, at this stage, while they started off encouragingly, promisingly, it's still -- they're still not efficient enough. And this is a long-term project because what we really want to -- I mean we are really leaning on these Hunters -- on our hunter team to acquire new business. And in some areas, the model works just fine. I mean some of our people really have achieved significant performances in terms of acquisitions and new customer acquisition. That's the Hunters. But if you look at the traditional sales force, in April '21, well, they found themselves facing a completely new deal. I mean this was a complete sea change in the way they were doing business because by April 2021, all migrations were completed, which meant that instead of having a situation where they were renewing subscriptions, which had been their job since the beginning, now suddenly instead of renewing existing customers, they had to recruit new customers. They have to sell new subscription programs. And it meant that we had to support them or to train them and make sure they were able to -- they were equal to the task. Well, we can't do this sort of on a collective basis. It was on an individual basis. Each person had to be assessed. Some of our people stay close to our customers because we need to have this continued presence. We need to monitor our customers. We need to make sure that especially the high-value customers, we can't just let them go on automatic pilot as it were. And then those who have this in them, that is to acquire new customers rather than keeping existing customers happy, well, we need to provide them with the additional skills needed for that. But regardless of whether they are Hunters or sort of traditional salespeople, we will have to revisit our contact, the way in which we address our customers because the more we help our salespeople target prospects and new customers, the better we do this, the better our model will perform. And this will become a virtuous cycle if we can make it happen. So that was item number two. Item number three is the large accounts. The end of H1 2021 ended quite well. But that account has to be our growth driver at Solocal. If you look at this slide, you can see the entire range is represented here. Autosur, which is one of the largest networks of car technical inspections, automotive technical inspections, we work with them on digital advertising, boosting their network. Now you have to see the reason we got an award here was no coincidence. No, this is because we produce 7,000 new contacts a month for all 280 Autosur stations. And so that is quite a performance. And of course, the Autosur people have certainly seen that there's a definite value for money here, a good return on that investment. Now Connect Réseaux was completely revamped in H1 2021. And sure enough, that has brought in results. We won a new large accounts, Cojean, which is a wellness restaurant network, and they are delighted to work with us. And then there's another significant item. And not everybody realizes, I mean we're not seen to be a data management player. And yet, there, you have Lacoste, well known in the garment industry, they want us to go through their own customer base and optimize that database. Now this is because of our know-how in market. And that particular know-how means that we should be in a position to help our customers gain more value out of their data or their customer data. So what are the challenges to come? Well, on the 20th of October, in a few months' time, we will be, of course, presenting the performance for Q3 2021. This will be our chance to share with you the 3-year plan, the 3-year strategy as well as the associated business plan. But I mean before then, I felt there were 3 things -- 3 parts of our strategy which I felt we should share with you, things that we're already working on. Number one, our customers. I mean know your customer and see how that knowledge can help boost our own operations. We have to be in a position better to understand our customers because when we understand them better, this means that we can understand their needs better. We can -- we are in a position to identify their expectations. But more to the point, we can provide customer satisfaction. So that is key. But that again is data management. We have to manage our customer data, and that needs to be up -- that has to be geared up in the months to come for that work to be more effective. The second strategic direction is to move from a product proposition to a digital solutions proposition. And for the months I've been working with Solocal, listening to our employees and our contacts, I look, I wonder what is our profile. At the end of the day, we are a sort of a SaaS company, a software-as-a-service company. And if that is the case, if we -- if that is really our actual DNA, well, there are 3 conditions that need to be met. Number one, we have to offer personalized support at all SaaS companies go all hog in terms of customer support. Then creating perceived value, that is our customers should be happy, they should be happy that they got what they wanted, and they make it known. That is what is known as dashboarding. In other words, we have customers who are completely supported throughout their digital strategy. They -- we have to be constantly trying to meet -- not just meet customers' needs, but also preempt them. And then, of course, we have to come up with new products, of course, digital support, digital advertising. But there are new services, what we call transactional and relational services, again, using IT. But that shows that our customers have their own ecosystems, but we have to increase to optimize the use value of that ecosystem so that they realize they can make the most of the treasure they have in their hands with their customer data. And then of course, we have to go back to the basic function of PagesJaunes. It is a media. It is, of course, a platform. But it is an instrument. It is -- it can deliver performance. But what -- how can we improve the positioning of PagesJaunes? How can we make it the incontravertible player? Well, I believe there are 2 aspects to it. Number one, customers visiting PagesJaunes may need to be reassured, and they may also need sort of security. They feel that we have to provide that sense of security. And so that asset, PagesJaunes should be the sort of the third-party sort of honest broker who will ensure the effectiveness of the relational and transactional work. If that is the case, our service will be much, much more relevant because if we can achieve that kind of relationship, we can certainly become very effective in these. Okay. So that is for me. And let's move on to the conclusions of this presentation. As Olivier said so himself, stable revenue in Q2 2021 means that our H1 revenue is down only 5%, pretty stable. Secured revenue with our renewal sort of subscription model stands at EUR 366 million at 30th of June 2021. EBITDA is confirmed, it's about EUR 120 million. And again, we were able to stabilize our customer base over the year. Now the next date, we will be presenting the numbers for Q3. And then we will, of course, be presenting the 3-year strategic plan by the same token. Thank you for your attention. And now the time has come for questions, if you have any.

[Operator Instructions] There are no questions in the lineup. We have one question from Mr. Eric Blain from Finance Connect.

Yes, can you hear me?

Yes, we can hear you, Eric.

I had a question. My first one is, in terms of the plan that you represented saying that in October, will you be needing extra financing for that October plan? And an underlying question is why have you chosen to pay back half of RCF in shares, which, given that you are your share rate -- share price is considerably low for some people.

Well, just on the 3-year plan, so for the 3-year plan, then we aren't working on the basis that we will need or that we need any additional funding. We won't need any extra funding, well, simply because, currently, we can't actually take on further debt. So quite clearly, what we are going to do is that we are going to base our 3-year plan on a financial structure that we know of currently and with the financial structuring. And that's the only financial structuring that we will have. So that's the first point. Also talking about RCF payback, why have we chosen to do a 50-50 split between cash and shares? First and foremost, and I'll say it again, it's the first time in some 10 years that Solocal has been able to pay back some of its debt in cash. So that's the first key take-home message. So why do we focus for the other half in shares? Well, this is a facility that we've been able to do because of banking regulations. And this is the regulations and agreements that we came to with our debt holders. And the reason for that is because when you look at the EUR 3 million, it dilutes the impact that we will have in terms of shares. But that impact will actually only be between 1% to 2%, so it's miniscule. So our duty, for Herve and myself, we need to ensure that we take all necessary provisions to ensure that we don't -- we aren't faced with a liquidity issue. So we're not talking about just 3 million here or there. When we look at the coming 12 months of business, what we can clearly see is that EUR 3 million isn't really going to change much. But really when we look at the 1% to 2% change in terms of our share price, it's not that major.