Thermador Groupe SA ($THEP)

So good evening, good evening, all of you, and welcome to this webinar, where we're going to explain to you the turnover for the first quarter. So I remind you it's going to happen. We've got a webinar, which will be in French and a webinar at the same time, simultaneously in English for our English-speaking investors. So a few rules. You can ask questions on the questions tab or you can chat between you on the chat area of the platform for the webinar. So this presentation will last about 25 minutes. So don't hesitate to put in your questions as soon as you're ready to do so. And we're going to respect 1 hour maximum for this webinar. You undoubtedly received the letter to shareholders, Number 1, 2, 3, where we give a full breakdown of the quarter's results. First of all, a word about our workforce. We've had a very good first quarter of 2026 because as you saw in our letter to shareholders, turnover is up. The growth of our turnover is greater than the growth -- the very modest growth in our headcount, which is up 1.4%. And as we'll see -- later on, we'll see that the turnover is much higher and that we continue to respect that ratio that we keep an eye on all the time in the medium and long term. So analyzing these figures, we've been able to identify a number of positions in the group, which were doubled up because of early recruitments made in preparation of certain departures. So in terms of business activity, as you'll see in the letter, 17 of our 21 subsidiaries are in growth. That's a very good sign. And in particular, 6 of them had growth over 10% in turnover, which is really important. So Mecafer, Domac, Isocel, Aello, Axelair and Distrilabo, and you see that these companies all work in different fields in retail, construction industry and the water cycle. In the area of heat pumps, there is a positive trend, both in France and Europe. We're mostly involved in the market in France and New Zealand with Isocel who supply heat pump manufacturers in France and the figures for Thermador who supply heat pump accessories who have seen their turnover down over recent months, but has now come to a more stable position over December and the first quarter. And that's very important for Thermador and its range of products, accessories for the heat pump market, slightly in growth. New homes -- newbuilds of new homes. We've had some exciting announcements from the French government. They intend to build up to 400,000 housing units per year by 2030. Just as a reminder, in France in 2025, we only built 275,000. So there's quite a gap. Even though this -- even if that's a good news, we've got no signs for the moment of that coming into practice. So in the retail sector, we've got 4 major players dominating this market. They represent more than 80% of the market overall. And the trend that we've seen and that's confirmed in those players that they're investing in e-commerce, but also, they're taking interest in Pro products, so selling to trade, which could be beneficial to us in the future for those product ranges because we already have Pro ranges, of course, already. In industry, a similar trend to what we saw at the end of last year. So a positive trend. You'll see in the letter 1, 2, 3, all the companies from Sferaco downwards are in growth, and that reflects good performance of those companies on that sector and even gains in market share. So in terms of milestones, we've got price impact. The price impact remains negative at minus 1.4%, which is a bit of a surprise because we're expecting to move into positive territory fairly quickly this year. And we'll see that this will -- that will probably come through by the end of this year. Heavy rainfall, so very rainy weather, which had a negative impact for our water markets, Jetly and Odrea, but also for our sometimes, direct customers and the public works sector. As you can imagine, when we have too much rainwater, it's very difficult to work on a public works project. So that has impacted DPI and Jetly. So it's difficult to ignore the geopolitical situation at the moment for this first part of this year. No impact on our turnover for the moment from this war in the Middle East. And we have signed up transport costs -- contracts -- transport contracts, sorry, for 2026. So the impact is under control. However, there have been major raises -- increases in prices for products such as polyethylene and PVC. And that, of course, affects DPI who deliver directly from -- directly to the -- from the sites. So we're receiving some alerts from the manufacturers of polyethylene and PVC of a big impact and even possible shortages. We announced at the AGM, separation of the roles of Chairman and CEO. And the day after that meeting, it was decided at the Board meeting on the 8th of April to name Olivier de la Clergerie as Chairman, and myself as CEO. Patricia, over to you.

So just a mention of the AGM. It took place on the 7th of April and 205 shareholders joined us at the meeting. We had 1,000 (sic) [ 1,300 ] voters and 78.9% of voting rights were accounted for. So thank you to all of you for this -- your accompanying us in this event. The resolutions were voted between 88% and 99.99%, so a very good result in terms of governance. The resolutions were well accepted. The only one that was -- the closest one was the distribution of dividends, which only 88% in favor. There was also resolution 21, which was rejected, but that was in line with the advice of the Board of Directors. So I'm going to move on to our results. Guillaume started talking about a number of milestones. And this allows us to link up the news, if you like, with the figures for the first quarter. So we've had a decline in the retail market at minus 1.2%. On the one hand, a drop in turnover with Odrea in France and Spain, which was partially and mostly compensated for by Mecafer and Domac and their great performance in the first quarter. In terms of the Pro channel, that covers industry, water cycle and construction, of course. So in those activities, we had the help of 2 new subsidiaries, of course, C2AI and Quilinox, which -- they arrived at their expected levels, should we say, of turnover. As was more or less the case for the last part of 2025 because we've already integrated at that point. Concerning turnover, industry where it's up and construction, which is up, and that's commented on by Guillaume already. So 5.4% increase on the Pro channel, up. Overall increase, 9.6% over the quarter and plus 4.2% to constant scope. So that's due to good volumes and good performance from our subsidiaries. So in terms of the profitability level for Axelair, work in ventilation was created in 2014 and has had losses over the last 11 years, and they've seen growth in their turnover. And there were some cases that also in 2025. So this continued at the beginning of 2026. And so we see that they over the breakeven position for the period January to March. and worth noting. So financial structure. We have, of course, historically a solid finance structure. A new record in terms of cash. We have EUR 105 million. And then in terms of debt, we've got EUR 40.2 million of debt. That's all debt with fixed rates and over 7 years. We have no new loans in that area. So it gives a positive net situation, taking off the EUR 19.3 million paid on April 17. So we've got a EUR 45.6 million net positive cash position. That allows us to have flexibility in terms of our investments from our own funds and maintain our independence and be able to look at external growth opportunities. And that's -- of course, we will look carefully at all options. Another word about stock. Because these are questions we've had in the past. In our meeting in Paris, we had a meeting of our shareholders after the AGM in Lyon. A number of shareholders were worried about our stock levels. The stock represents 176 days, and we've already moved down from the level of December. And we feel that is compatible with our activities. Quite a bit of problem with the New Year -- Chinese New Year. And we see that our subsidiaries are selling to purchase and that allows us to continue to supply our customers satisfactorily. So I talked about funding from our own funds, from our own equity. We've got EUR 12.3 million of forecast investments, with EUR 6 million for the property part. And there are 2 major projects, which concerns Sferaco. So automation and extension over 2026, 2027. That's actually started. And of course, the automation of the logistics side, that will be going ahead over 2026, 2027. The other project, which contains Distrilabo in Alsace. And this subsidiary, we've just signed the first contracts for the new building for them. And we're pretty sure now that will be delayed to 2027. So it gives us an investment forecast -- readjusted forecast of EUR 9.5 million. And that all continues -- allows us to continue to invest from own equity. So digitalization will continue within the group with electronic invoicing as well and digitalization in the different companies of the group. Concerning the value of the share price. So the return on reinvested dividends for the Thermador Groupe share, it's a pretty solid performance. This runs from -- this graph runs from 2016 to 2026, takes from last Friday. And we're very close to the performance of the CAC 40 Index, and that confirms that it's a long-term share investment, and it reflects our dividend policy because we continue to issue dividends, and that dividend rate has never gone down. Of course, we are sensitive to short-term events, and you know that the geopolitical situation is very -- has a big impact on the stock exchange in general. And so for Thermador in particular, we don't -- we're not spared by the effects of the uncontrolled declarations of the American President you saw on Friday afternoon, a very strong growth on the stock exchange and a drop again today after the opening and closing of the Strait of Hormuz. So if you remove cash from the company, of course, that reduces the price of the share. So the prospects are obviously very dependent on the geopolitical situation. And I want to really insist on that point because the questions we get from you is what is the impact of this war in the Middle East on the group in terms of new homes. We see there's a risk of an increase in mortgage rates, of interest rates in general. And if this happens, obviously, that will affect mortgage rates and it could well bring an end -- an early end to this beginning of the promising cycle in the new homes, newbuilds that we've seen over recent months. Having looked now at energy renovation, seeing the first question coming in. Government, very encouraging announcement from government. But I'd like to measure those a little, this compared to the geopolitical situation. The public authorities want to double the amount dedicated to electrification in France. So replacing fossil energies by electrical energy by 2030. But when you asked the question of how this doubling is going to happen. We know that, that will -- won't come from the state's budget because there's no money available. And therefore, all eyes turn to the energy savings certificate, the CEE, financed by the energy providers. Okay. That works really well when energy is inexpensive. So at the moment, as you know, energy prices are going up and in particular, the price of petrol at the pump. So this funding from the energy savings certificate may well be compromised by this increase in energy prices, fossil energy prices in the medium to long term. So good intentions from the public authorities, but be aware in terms of the real impacts that they will have because when financing will have to be found outside of the state's budget. The public authorities were very precise with this announcement, which is, of course, good news for us because the Prime Minister wanted us to install in new and non-new buildings, 1 million heat pumps per year by 2030. So that is a multiple of 6 where we are today. And that could, of course, benefit groups like Thermador because the equipment dedicated to heat pumps in terms of value are greater than the accessories that we supply to the gas boiler market. So it will be beneficial for us. And there's another major announcement was that the end of boiler installation is due at the end of 2026, so a very short time line. And that includes hybrid, so gas but also hybrid by the end of the year. So no more boilers to be installed in new buildings. They're to be replaced, of course, by heat pumps. So I've already answered the question that we've had on the chat. These, of course, they're promising, but there are obviously question marks about whether they're achievable. So the Pro markets that we have for February, don't indicate any major improvements. So waiting for the figures for March. We don't have those yet. We'll have those this week. So it's stable in terms of B2B customers, for the wholesalers for new works and plumbing accessories. We keep an eye, of course, on the PMI Index. This index -- you know this index because when they are above 50, that shows that this market is growing from one month to the next. So on the left-hand side is the curve for French, and on the right, for Europe. And we see there's been very little impact of this geopolitical crisis on industrial activity in France and in Europe. But it's obviously very likely that this impact will be very marked if the crisis continues. And in particular for industries like chemical and petroleum industry to whom, of course, we sell. So a much less favorable market environment because we are attempting to gain market share. And if the market contracts, it's more difficult to increase turnover mechanically. In retail, then no indication of a restart of this market. But in spite of the opportunities that were taken up by Domac and Mecafer at the beginning of the year, no real prospects because -- but budgets dedicated to energy renovation are because -- sorry, French people's disposable income is decreasing, so difficult for it to imagine people investing in the DIY market. So a negative tendency for -- sorry, for April, which, of course, we can't -- we don't see that yet on these results. So we're hoping that will turn around a bit. So in terms of e-commerce, talking about the different players on the market, you've got the pure players like Amazon who stock and deliver equipment, but also on the marketplaces, in particular, with one that has a really strategic position in France is called Leroy Merlin. And Castorama, one of its competitors, is also showing -- being very active on that market. But also there's an opportunity for us to sell directly to the end user, especially on aftersales service. And of course, with always the objective of making those products last longer. So that's a good option. I would like to emphasize that in France, it's not very good for this market, the saving -- the tendency towards saving is on the up, which is in line with the anxiety rate in France. So in the water cycle, we've appointed Alexandra Statula, who is currently Administrative Director at Odrea and will progressively take over the management of DPI. She'll be there in September. She's already there part time, but she'll be there full time from September until the end of 2027. And that's the date at which Gregory Urpi, according to the agreements we have together, he'll be leaving at the end of 2027. And DPI's sales departments are also being restructured. And in particular, we're working on the water cycle for a range of solutions in the gray water, the reuse of gray water and the processing of water, the treatment of water. And we joined a new association, which is called AFREG. That's the French alliance for gray water recycling. It's a grouping of companies that are working on these solutions. You know that water, even though it may not be the case of late, it will become rare and expensive in Europe, and it's a market that we're working on for the future. Internationally, a strategic appointment in progress. We're looking for a full-time employee to identify opportunities for acquisitions. And that answers one of the questions that was asked. This is a question we haven't yet -- we haven't identified any opportunity that we can talk about to you at the moment. Of course, we are keeping an eye on different options. But of course, as usual, we will only start talking about those options when a letter of intent has been signed, and that's not the case today. We are having discussions in France -- with a company in France, and -- but that's not far long enough to be able to talk to you about that today either. So the role of this new employee will be to look at all the opportunities right across Europe, which correspond to the strategy, i.e., distribution in industry, but also in the water cycle, make contacts, keeping contact with the directors of those companies, the owners of the companies and be able to contact them quickly if those companies became available in the market. The price impact for 2026, it's clear that this impact will increase fairly quickly because we've already received notification of price increases from our suppliers, and we've already talked to our customers about those increases in prices. We're expecting that to come into force in June 2026. And we are feeling the price effect at the moment is minus 1.4% as we saw earlier on, but we're expecting that to be above 2% on average for the 2026. To close, just a few words of optimism because we're looking at the last slide, which is organic growth by quarter over a period of about 5 years. So we have moved out of this negative phase that you see over a period of almost 2 years. But we have to modulate, of course, that with the possibilities of the current crisis. If that geopolitical event that we are currently expecting, the crisis in the Middle East, we'll probably see that curve continuing in the upward direction. So now we finished with our presentation, which gives us some time to answer your questions.

I've already answered to the question about the government measures on heat pumps, but be aware of the financing. We've also had a word from Rodolphe who's understood why the public authorities hadn't taken more interest in the construction of new building in the last 2 years, which I have no answer to that because, of course, there's a real need for it in France and the problems are ahead of us now. And we've got behind in terms of capacities. Do you have any acquisition targets, especially outside France? Yes, we do. Projects that are far enough along for us to be able to talk to you about it, well, no. And what was the increase in volumes in Q1? They're obviously bigger in terms of volume because there was, of course, a negative price impact of minus 1.5% -- 1.4%. A bit of a problem with the English part, but I have an English question. So this is a French question, sorry. In terms of electronic invoicing, will this -- will we see any savings? We're starting to work on productivity gains where we'll be able to receive invoices from our suppliers electronically. So we're hoping to get some productivity gains, and we're going to work on that. Another element is that any invoice is sent via platform. And that, of course, implies a cost. But we've already worked a lot on sending our invoices via e-mail and so forth to dematerialize factors, paperless invoicing. So we're already fairly well along the way for that. Victor want to know what percentage of turnover is gained from heat pumps? We don't actually give that figure. And we're sure that some of our competitors will be interested in this information. So we don't talk about it. But we've got some detail per subsidiary. But as I said earlier on, the variations that you may be seeing in our subsidiary, Isocel or Thermador, positive variation, but negative in the past, would suggest that there is an impact -- a positive impact on the heat pump market. There were 2 key events which helped Thermador, the increase in the sales of accessories for heat pumps, but also the increase in sales of thermal heat panels. So the decline in the turnover for Thermador is a lack of funding. So I can't give you any more precise figures than that because I don't want to provide too much data for our competitors, which is of this internal data. Do you mix commercial commerce and e-commerce? Yes, in Aello, for example, there's a very substantial part of turnover from an e-commerce platform. So actually, it's not pure e-commerce. It's a natural order placing platform. So it's open to professionals and the technical solutions are progressively being rolled out throughout the group. The percentages of turnover from e-commerce platforms remains confidential, too. The sales that we make directly to users via e-commerce platforms are really small in terms of percentage of turnover because it primarily concerns only aftersales services. And we have some sales in DIY superstores for SAV products. There's a question about Axelair saying that they arrived at the breakeven point. So the question is for Thermacome and DPI, when are we going to get into positive territory with them? And we've seen that DPI and Thermacome are losing money. It's important to understand that we've only just acquired and there's an amortization of the goodwill. So the customer relation thing, to be exact. That means that DPI without amortization was profitable, and Thermacome is the same case, made them very close to the breakeven point. The idea is it's not an operating loss. It's just we got the amortizations. And why do we do that is to avoid having to depreciate assets a few years after the acquisition. So it's use of the customer relations, which we call goodwill. Jean-Pierre asked a question about managerial transition at DPI. Maybe I didn't express it properly. The departure of Gregory Urpi is planned for the end of 2027. So there is -- these 2 will be working together from September. So at the end of 2027 is exactly 5 years after the acquisition as planned. It was planned that Gregory should leave at the end of 2027, just to be precise for Jean-Pierre. So we're finished with your questions. No questions on the English side. Sorry about the technical problem that we had on the English side. The replay is in English, but you won't be able to ask any questions, of course. So don't hesitate to ask us any of your questions by e-mail. So another question. So it's about Odrea and the results of Odrea in relation to its trend to a decline in turnover. So plus 4% for [ Q1 2006 ]. That's a pretty brutal question. Shouldn't you imagine restructuring the subsidiary to take into account the persistent decline in turnover. So it's a bit brutal. That would indicate reducing headcount. It's true that the budget for Odrea is not positive for 2026. So we're likely to see a decline in turnover and a decline in profitability. So we're working on it for recovery at the beginning of 2027 through investments in the distribution channels other than the traditional DIY channels. There's also the Spanish side. Work started on that last year and it continues this year to be able to find new developments, new customers. And of course, that takes time because it's referencing with different stores because they're negotiated on an annual basis, of course. But of course, it will take time. So Romain, you're making things look worse than they are. You're talking about the decline in turnover for Odrea. Odrea did manage to maintain its profitability. And that's why I want to reassure you for 2026. And the manager of Odrea has not planned for a loss in profit for 2026. But we're working with certain customers at the moment. And we're going to be putting in place certain measures towards the recovery of Odrea, but certainly no plan for restructuring at Odrea. You know that in the Thermador Groupe, we have a long-term vision. And that's why we're resistant during difficult times like we're experiencing at the moment. Are there any other questions? We're pretty satisfied with this first quarter because it's a long time that we haven't been able to announce a net increase in turnover and so many companies with growth around 6% with over 10% but we remain cautious about the future and the short -- the medium and short term -- the short and medium term because of the situation, the geopolitical situation and will have -- certainly have an impact in France and in the world and Europe, sorry. Many companies like us are going to suffer certainly from all this instability in the world. So it's obviously an advantage for us to have a wide range of different activities. And you see that our subsidiaries continue to resist. And we hear people saying, you've lost turnover, you keep your employees in place. But we know how valuable our brands are, and we -- that's why we invest in them and stand by them. And with those investments, I talked to you about EUR 9.5 million. That shows that we are intending to invest in our warehouses and so forth. So we remain -- we continue to have a positive outlook. And for our salespeople as well, we're happy to see the results of their work as our turnover increasing. So thank you for your -- we're being thanked for our efforts during this difficult period. So I want to thank you for your support and our wonderful AGM. And it was a great satisfaction for us to be so close to 79%, which is a remarkable participation rate at our AGM. And of course, you used all the tools available to you to vote, for example, with ACCESS voting, all that. So thank you to all of you for your support. Since you have no more questions, we're not going to stay connected just for the pleasure of it. We're going to see you, unless anything drastic happens in the middle of July, when we'll return, we'll talk about mid-July for the results for the end -- for the first half year and at the end of July for the end of the second quarter. Good evening, all of you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]