Welcome to the Clariane Q1 2025 Revenue Conference call. My name is Alan, and I'll be your coordinator for today's event. Please note this call is being recorded, and for the duration, your lines will be on listen only. However, you will have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad, and participants can also submit their questions over the webcast. If you require assistance at any time, please press star zero, and you'll be connected to an operator. I will now hand you over to your host, Sophie Boissard, CEO, to begin today's conference. Thank you. Thank you, Alan. Ladies and gentlemen, dear investors, good afternoon. Welcome to the Clariane Group's first quarter 2025 revenue presentation. I am Sophie Boissard, Chief Executive Officer, and I am today together with Grégory Lovichi, our Chief Financial Officer. Let us begin on slide five with the four key highlights of this first quarter. Revenue for the three months to end March 2025 rose by 4.8% on an organic basis. This corresponds to a 5.5% increase on a comparable basis. Second, all business segments and regions contributed to the organic revenue growth, with volume growth coupled to positive price and case mix effects. Three, our 2025 outlook is confirmed. As a reminder, our guidance for this year is composed of organic revenue growth of around 5%, EBITDA growth of between 6% and 9% pre-IFRS 16, and excluding disposals, HoldCo leverage ratio of less than 5.5 times. Finally, the quarter saw a step forward on our disposal program, with more than EUR 600 million of the program now secured, as opposed to a little bit more of EUR 500 million at the end of 2024. Total proceeds from this asset disposal program initiated at the end of 2023, as part of our plan to strengthen our financial structure, are expected to amount to EUR 1 billion by the end of 2025. I will now hand over to Grégory to provide additional details on our revenue figures. Grégory, the floor is yours. Thank you, Sophie. I will begin on slide seven, where you can see our revenue growth by geography. The difference between reporting and organic growth comes from the impact of disposals carried out in 2024 as part of the plan to strengthen the group's financial position. Importantly, growth rate must also take into account the fact that there was one less business day in 2025 than in the first quarter of 2024, which was a leap year. Adjusted for the factor, organic growth was 5.5%. All regions posted solid organic growth this quarter, with Germany leading the way at +8% on the strength of its recovery program, driven by steady growth in business volumes and the ongoing catch-up in prices that began in 2023. Few words on France, and more specifically on long-term care. In this segment, revenue grew 2.8% organically, supported by price adjustment. Affected by the flu variant spreading particularly quickly in 2025, and despite a significant increase in new arrivals compared with previous years, the average occupancy rate was almost unchanged at 87.4%. It should be noted that the occupancy rate was 88% in the first quarter of 2025 when trimming out the beds temporarily unavailable because of refurbishment and improvement programs. Moving now to slide eight with the year-on-year revenue bridge. The +0.7% increase in reported revenue growth can be broken down between an increase in business volumes in all segments that boosted revenue by 1.1%, corresponding to a net EUR 13 million uptick. This came from a higher volume of days billed in mature networks and additional capacity coming on stream. Price increases that had a positive impact of 3.7% and boosted revenue by EUR 47 million, with the revenue growth essentially coming from the long-term care segment in France, Germany, and the Belgium-Netherlands region. An important negative scope effect of minus 4.1% or EUR 51 million was due to the disposals made in line with the group's financial strengthening plan. The main impact corresponds to the sale of U.K. and home hospitalization activities in France. Looking now at the breakdown in revenue by activity on slide nine. Once again, the revenue increase was well spread throughout our balanced portfolio. Long-term care, which accounted for 63% of the group's business activity this quarter, grew 5.6% on an organic basis and 6.3% when excluding the leap year effect. Growth was driven by the ongoing increase in business volumes, despite the impact of the very strong flu epidemic this year and by pricing upticks. Specialty care accounting for around 25% of the group total, with organic growth of 1.4% and 2.2% when excluding the leap year effect. To note, revenue in France in this segment was almost unchanged, reflecting higher volumes coming from the strong development of outpatient activities at 24%. The basis scope for comparison in prices was temporarily unfavorable, with annual index-linked price increases being implemented on April 1, 2025. Revenue in community care, whose brants include Petits-f ils and Ages & Vie, represented 12% of the group total, posting the strongest organic growth at 7.8% and 8% when excluding the leap year effect. Here too, the reported revenue was down due to scope effects. On slide 10, you have the updated snapshot of the evolution in our occupancy rates. The continued improvement in our occupancy rates since mid-2022 had been the main driver in our revenue expansion in long-term care as the sector returned to normal. To note, since Q2 of last year, the price effect has overtaken volume to become the main driver of our revenue increases. From a low of 85.6% in Q2 of 2022, we've now reached 90.4% in this quarter. On a year-on-year basis, the improvement is 80 basis points, despite the impact in France, Germany, and Spain of the very strong flu epidemic. Looking ahead, this trend is very positive. We have room for embedded growth in our existing capacity. I will now hand back to Sophie to conclude on our refinancing plan and outlook for 2025. Thank you, Grégory. Let us now move to the update of our plan to strengthen our financial structure on slide 12. As you know, with the successful completion of the capital increase in the first half of last year, Clariane has completed the first three stages of this plan, which was announced in November 2023. The plan was achieved despite challenging market conditions in a sound timeframe, considering volatility remained strong in the following quarters. The fourth and final part of our plan consists of a program to dispose of operational and real estate assets and to raise EUR 1 billion in gross disposal proceeds. Today, slightly over 60% of that amount is already realized or secured. On slide 13, you have the principles that have guided and will continue to drive our assets disposal strategy. At the end of December 2024, Clariane had already completed or secured disposals generating gross proceeds of EUR 504 million. Since the beginning of this year, Clariane has continued to implement its program in accordance with its strategy to become more focused in terms of business activities and geographical footprint. During the first quarter, we secured six further disposals relating to around 15 care facilities or networks in France, Germany, and Italy for around EUR 100 million. Clariane is currently implementing various disposal processes of various sizes and geographies to complete its asset disposal program and to ensure that we achieve our target of EUR 1 billion gross disposal proceeds by the end of 2024. I will now conclude on slide 15 on our unchanged guidance for the current financial year and for the period of 2023 to 2026. I have already outlined in introduction our 2025 yearly guidance. I will remind you of our outlook for the 2023-2026 period. We are counting on average annual growth rate in revenue of around 5%. This will come with improvement in margin, with a target increase of 100-150 basis points by 2026 pro forma of disposal and 2023-2026 scope effects. At the end of 2026, we expect our HoldCo leverage to be below five times, consolidating the group's financial structure and the recovery in operating performance. Our ESG commitments remain unchanged. With the achievements of our plan to strengthen our financial structure, the strong business momentum, and the sound fundamentals of our business portfolio, we will continue to move ahead in the coming months with a great deal of determination and confidence. Thank you very much for your attention. Operator, can we move to questions, please? Thank you. If you'd like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. You will be advised when to ask your question. We will take our first question from Laurent Gelebart, BNP Paribas. Your line is open. Please go ahead. Good afternoon, Sophie. Good afternoon, Grégory. Good afternoon, Laurent. Yeah. I have three questions. I hope you can listen to me clearly. The first one relates to your occupancy rate on French nursing homes. We have been seeing a kind of slight decline in Q1 due to the epidemic. Could you let us know what has been the trend in April? Maybe you see an upturn coming in and a further improvement of your occupancy rate. The second question relates to France still and to your SSR business. You mentioned in the press release that the decreased implementation of prices has been pushed forward to the 1st of April. Can you explain a bit what has been happening and what kind of tariff revaluation you expect from April onwards? Third, on the disposal program you have been achieving since the start of the year, so the EUR 100 million of deals being closed, could you let us know what is the turnover in front of that and its EBITDA? Last point, could you guide us in terms of impact scope effects we are going to see for the year with all the disposals you have been achieving to date? What would be the overall full-year impact with what you have been doing as we speak in terms of supply and EBITDA, if you can? Thank you. Thank you, Laurent. I will take the two first questions. If you agree, Grégory, you take the third one on the impact of our disposal program on revenue. On the nursing home France, yes, you're right. Actually, we had the highest-ever inflows of entries, growth inflows. Of course, we faced also a pretty lengthy period of seasonal infections from December on to end or end of March, which actually globally, not only in France, represents a negative basis points equivalent impact on occupancy rate average. It is pretty significant. Currently, since end of March, we see net occupancy resuming since actually epidemics is really stepping, going down at last. We are back to something that is above 88%. This taking in consideration the fact that we have also several five projects where we did some structural work, and we are still expecting the licenses to operate to be granted again after the delivery on the work. This will present some 200 beds that are kind of impacting the basis. All in all, net occupancy is going up again since end of March, and entry inflows are really good and strong. We will see also further trends that are already highlighted. The level of dependency and the type of profile has been is actually more and more towards heavier dependency. The profiles of residents and the profile of beds is definitely moving forward onto geriatric long-term care rather than elderly care as it used to be some five or six years ago. When it comes to the post-acute and the SMR, SSR, actually the environment has been a little bit volatile over the first quarter. What I can say in a nutshell is that we will benefit all in all this year from an average plus 2% indexation on a yearly basis. This being the result of a blended effect. We have a plus 3% on the mental health, which is representing a little bit less than 30% of our network. We have a zero plus on the post-acute indexation, but we benefit from an increase on the average care mix effect on the back of the reform last year. This is why the pure pricing effect is something on a yearly basis around plus 2%. We have, of course, the active case mix management that comes on top of this. This is going to support the growth in that segment, plus the outpatient activity that is not capped in terms of volume. All in all, plus 2%. I'll leave the last question to Grégory. Bonjour, Laurent. On the question on the disposal program, and as you can see already in the first quarter of the year, we have an impact of disposal of EUR 53 million. When you project on a full-year basis, taking into account as well the EUR 600 million secured disposal, we will have a scope effect on the top line of EUR 160 million on a full-year basis. Thank you. Regarding the deals you have been closing in Q1, was it OpCo? Is it PropCo? Was it profitable? Was it limited to the group, etc.? It is mainly 90% OpCo, a very small component of real estate. These were definitely below average EBITDA margin of the company or facilities that would have needed CapEx in the next three years. It is definitely contributing to the margin profile of the company looking forward. And the multiple. To 13 in average that we have since 2024, multiple around above double digits. What you need to have in mind as well on the disposal program. It's a blended one. It's a blended one. The disposal program is set up as well for the delivery. That is a key criteria as well when we look to assets to gain disposal. Thank you. Good for me. Thank you. We will take our next question from Pierre Boldsky, HPK. Your line is open. Please go ahead. Hey, thanks for taking my questions. Congrats on a solid set of numbers. A few from my side. Just on the multiple, I didn't hear the number of the disposal program. What was that? The blended multiple. Is that blended for real estate and operations, or is it just the blended operations multiple? For the real estate, could you provide the cap rates at which you sold on average? For the disposal and the blended, it's blended for OpCo and PropCo. It is an average blended for the EUR 600 million secure disposal program. On the cap rate, what is important to have in mind, and this is what we put in the last financial release, we tend to work with capitalization rate of the geographies where the disposal program has been made. What was the blended multiple, the number? It's between 11 times and 13 times. Yeah. For For the whole EUR 600 million. Okay. Understood. Great. Yeah. A couple more financial and operational. One, how are you thinking about the 2025 and 2026 Schuldschein maturities? Are you planning to address these with disposals or refinance? On development CapEx, the EUR 200 million, how should I think about that? Is that mainly on sort of a few select large projects, or is it refurbs across the estate? I guess, where are you spending most of that money on? In the new term loan docs, is there anything? Obviously, there's a dividend blocker above a certain leverage level. Is there anything that prevents you from redeeming your perpetual bonds as well, since that sort of could be seen similar to a dividend? Lastly, on the impact of the leap year, how maybe I'm thinking about this wrong, but how can it be such a big impact if it's only 91 versus 90 days? For example, in Italy, your organic growth would have gone from 2.2% to 3.3%, i.e., a 50% increase on one extra day or, yeah, sort of is there another accounting mechanism there? For the last question, it's probably we need to clarify something because actually it's only one day over 90 days. It's definitely we have just highlighted the impact on the organic thinking. I think on Italy, since we have done some disposal there, I think it's just a clarification on the basis of comparison. It has nothing to do with the leap year here. On the Schuldschein, if you want, on the Schuldschein, yes, you're right. Maybe if you have a look to 2025, it's a year we don't have or we have a limited amount of debt maturities in 2025. Mainly, and like you pointed out correctly, they are linked to Schuldschein and real estate debt. Obviously, we will look from an opportunistic and pragmatic way to work on maturities as well on the Schuldscheins. What we need to have in mind is that the plan to reinforce the capital structure of the group as well and the way we work on the disposal program is as well a way to address these maturities. I will maybe give the question on the development to Sophie, but you have a question on the SFA for the dividend and as well for the hybrid. Yes, you're right. When it comes to hybrid, the SFA documentation prevents the group from repaying hybrid instruments with debt when the HoldCo leverage is above 5. That is why everything what we are mentioning and the target of the HoldCo leverage is key because when the HoldCo will be below 5, it will be possible to work on the hybrid either on cash or on equity or equity-linked instruments. As well, when it comes to dividends, we have a constraint on the dividends with the SFA when we have a certain level, and it is about four times HoldCo. As you mentioned, actually. The dividend blocker you mentioned is correct and as referred in our annual report. Development CapEx of 200, actually, as you know, we have a pretty wide network in our six geographies, 1,000 to a little bit more than 1,200 different locations. We have actually a portfolio of 25-30 projects that are currently under development. It is mainly about rebuilding or upgrading or opening additional capacities in selected places. The total amount of these is actually EUR 150 million or EUR 50 million of internal development CapEx that we need to post. On the top of that, we have some selected earnouts that are related to the development we did in Italy and in Spain with the pipeline. We are currently delivering the last project related to this pipeline in Spain and in Italy. This is also taken into consideration in the EUR 200 million of development CapEx. Okay. Fantastic. That's very clear. Just one last one. I'm sorry for taking so much time. Can you maybe just share a bit of color on the situation in Germany? I think you had a very big staff cost inflation a number of years ago, and now you sort of have this catch-up mechanism. I think there was also a staff shortage that was sort of capping your occupancy there. I guess, yeah, just trying to understand how is that recovery going? How long will that cost catch-up effect last? By what time do you expect to return to, I guess, a normalized level of operations? We are in good track to be there by the end of this year and probably with the last part of repricing to be delivered next year. This is really in a very good way. When it comes to wage inflation there, this is definitely coming down. We had to swallow a plus 25% in 2023. This has been a pretty steep wage increase. Definitely with now the current economic conditions and now we are living in an environment where wage inflation is definitely slower. We had to pass an additional 5%-6% for this year that was pre-financed by the repricing in 2024. I do not foresee any further regulated wage increase in the next 18 months or so, 2026. This has been pretty well taken into consideration in the new coalition government program that has been published some days ago. I see from a market condition point of view, I see a rather positive development in Germany for sure. When it comes to staff shortage, we have been developing a lot of our own training programs and having the highest number ever in apprentices and having a good retention rate on these young nurses. The more we go, the less we see tensions on recruitments that would block us in the volume we can deliver. We are currently traveling at the highest level of occupancy in Germany. It is close to 91%, way higher than what we used to have before the coronavirus pandemic crisis five years ago. I think directionally that we can increase probably by one or two points at least in terms of volume, plus the further repricing and plus some extension, as I said, in places where we are at 100%. We're already at full capacities. Directionally, the market conditions in Germany are pretty good and well-financed. Thank you very much. Super helpful and much appreciated. We will take our next question from Constantine Gimenita, Couch Capital. Your line is open. Please go ahead. Hi, good afternoon. Thank you for taking my questions. Maybe to follow up on the most recent question, could you please comment on the overall labor inflation as a percentage for the group this year? In particular for France, could you comment on the availability of staff, sort of absenteeism rates, churn rates that you're seeing currently? The next one is going to be on the disposals, just the EUR 100 million done year to date. If you could confirm the multiple just for this perimeter and also confirm how many beds it relates to. Lastly, with regards to the inflation in the clinics business in France, if you could just clarify whether that 2% is for the entire 2025 or just from April onwards. Last question. The 2% blended is for the whole year on the clinic business. Staff, so wage inflation blended for the company is around 2% with a pretty significant gap between Germany with another 6%, 5-6%, as I said, on the yearly effect. And Italy or Spain that are more between 0 and 1, and France probably will be in the same region, around 1-2%. This leads to a kind of 2% wage inflation for the year. When it comes to the labor market condition in France, what can I say? I think we have, exactly as I said, for Germany, we have a very strong organization to source and train and develop the core expertise that we need, nurses, assistant nurses, and this is working pretty well. With the equivalent of more than 2,000 apprentices or employees that are trained to upskill in the care profession, this is really working well for the company in France that we have in our hands. Absenteeism rate has been higher in Q1 2025 than in Q1 in the previous year 2024 in France, very much related to the seasonal flu that I just alluded to, up by average 100 basis points, meaning that we are above 8% of absenteeism for the permanent staff in France. I see now a decrease in April, but it is a bit early to say. Definitely, absenteeism environment in France is, as it is for all industries, a point of attention, and we are working hard with the support of our unions internally with also incentive plan to lower this effect that is costing a lot of time and energy and also money to our network. Yes, absenteeism pretty under control and a strong action plan to decrease with good internal support on the plan. Multiple, we only communicated actually on the blended multiple on the EUR 600 million that we have delivered until now. I can say that for the last 15 OpCos we have disposed in Q1, we were in a high single-digit multiple. As we said before, the facilities we disposed were definitely ones that are deserving of further capex or restructuring. This is also reflected in the level of multiple. When it comes to the number of beds, it's 2,000 beds or equivalent beds that we disposed with these 15 facilities. I hope it's clear. Great. Thank you very much. Thank you, Sophie. As we have no other question live, we have a few questions on the web. The first one would be regarding the tariffification that we could expect for the next quarters. If you can give a little bit more flavors regarding the geographies. On the indexed or regulated. Evolution of tariffification for the next quarter. Let me try to make it simple. For France, actually, I have explained what we are going to live with for the specialty care segment. It's plus 2% blended fixation when it comes to healthcare funding. On the nursing home, elderly care home segment in France, we expect to benefit from around blended plus 3% price increase over 2025. This is a combination of the private pay part that is above 3%, 3.5%, and the subsidized part, the care part that will be probably, we have informal information on it, that will be probably between 2-3%. That's what we explain. This leads to a global around 3% or a little bit more than 3% from a pure pricing effect, regulated indexation effect. When it comes to Germany, we are expecting that this is really, these are local negotiations home by home, practically. We expect to benefit on the yearly effect to something that would be kind of 6-7% of pricing indexation on a yearly basis with the benefit of the second half negotiation. Most of the negotiation takes place in the second half. It will be a yearly average. When it comes to the other geographies, it is between 2-3% in Belgium, and it is more in the region of 5.5-6% in the Netherlands. Italy is definitely between, depending from the region, between 0 and 2% on the regulated pricing. We have the private pay that is mainly in Belgium. In Spain, it is difficult to give a global multiple because elderly care, mental health, and social care are, of course, differently regulated. In Spain, we are definitely more in the region around 2% indexation, so a little bit above the wage evolution. Thank you, Sophie. Next question, and I'll read the question. Since EBITDA pre-IFRS 16 is to grow nearly at the same pace than revenues in 2025, can you explain to us what are the main drivers of cost increase this year? I can take that one if you want. Just to remind, so it will not because the guidance is EBITDA growth between 6-9%, while the revenue will grow by 5%. Why we will this year regain margin, it will be the effect of this price and KDNI effect, and as well the positive effect from our better support program that will bring further margin points and make our EBITDA growing faster than our top line. Thank you, Grégory. We have no more questions. Sophie, if you want to conclude. Yes, absolutely. Again, we are really working to talk when it comes to support Clariane Network development, to the quality of care we are providing to our patients and to the local communities, and in an environment that is definitely with some strong momentum for elderly care and for long-term care, but also from some headwinds from the overall economic environment. We actually benefit from the fact that we are multi-local, well-positioned, and with a very stable and balanced portfolio. This is why we will continue to move ahead in the coming months with this very great level of dedication and confidence with all our Clariane community. Thank you very much for your attention. Thank you for joining today's call. You may now disconnect.