Welcome to the FDJ Q1 2024 results call. My name is Karen, and I will be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the presentation. This can be done by pressing star one on your telephone keypad to register your question at any time. If at any point you require assistance, please press star zero, and you will be connected to an operator. Please note, this conference is being recorded, and I will now hand you over to your host, Pascal Chaffard, Executive Vice President in charge of Finance, Performance, and Strategy, to begin today's conference. Thank you. Hello, and good evening to you all. You might have read the press release that we published at the closing of the market a few minutes ago, and the presentation that I'm going to comment is also available online in the investor section of our corporate website. I will present the key elements of the Q1 2024 FDJ revenue, and then you will be able to ask all your questions. So if I start right now, by the slide number three of the slideshow that have been released. During the first quarter of 2024, our revenue amounted to EUR 710 million, an increase of 7% versus Q1 2023 published, and +1% on a comparable basis, i.e., excluding the acquisition of ZEturf at the end of September 2023 and PLI at the beginning of November. This growth is totally in line with our expectations and also in line with our annual projections shared with you mid-February. Gaming revenues in France, i.e., lotteries plus sports betting offline plus online gaming open to competition, rose by 3% despite a high basis of comparison. Excluding Amigo, this growth will be over 5%. In other activities, revenue came to EUR 65 million versus EUR 37 million in Q1 2023, and this increase is more than 77%, is due mainly to the integration of PLI. The momentum on online gaming remains very strong, with revenue up by more than 20% organically, i.e., excluding ZEturf and PLI, and up by more than 30%, including everything. The digital penetration accounts for almost 15% of gaming revenue. This performance was driven by both sports betting and lottery. I will go into more detail in a moment on those figures, and also as an introduction, I will add that the 39-week tender offer for Kindred, launched on February 20th, remains subject to regulatory approval. I'll come back also to this later. If I now move to the next slide, it shows a breakdown of revenue by activity, and I'll explain the next two slides, first on the lottery and then on sports betting and online gaming open to competition, what is important to know about it. Note that as the lottery revenue grows, excluding Amigo being above 4%, it leads to a total group revenue growth close to +10% comparing to the 8% yearly guidance. So, next slide, talking about the lottery. About this activity, revenue totaled EUR 504 million, +1%, and as I just mentioned it, +4%, excluding Amigo. This performance was driven by instant games, thanks in particular to animation of the games portfolio, notably a new launch called Ticket Or, that you can see on the slide, launched at the beginning of January and which had a lot of success. The draw games activity was down 3%, which was expected given the unfavorable base effect on Amigo, whose new formula, as I recall, was launched in June 2023. The Q1 performance of 2023 was therefore based on the former formula of Amigo, and the decline in activity for this game has stabilized since June 2023, as we already reported, and as illustrated by the graph on the right-hand side depicting the average monthly stakes per POS, showing that it has been stabilized, even a little growth, in Q1 2024. On the digital channel, our business is very dynamic, with revenue of online lottery games by almost 20%, driven in particular by the digitalization of EuroDreams, whose digital penetration rate is over 35%, which means it is 10 points higher than that of EuroMillions and Loto, which are the better performers regarding digital penetration of all our games. But this success of online on this Q1 is also linked to instant games and to online exclusive that performed very well. If we now look at the next slide, which talks about sports betting and online gaming open to competition. The revenue amounted to EUR 141 million, up 10%, and up 1% excluding the integration of ZEturf. The performance is noteworthy given an unfavorable Q1 2023 basis of comparison in two respects. First, Q1 2023 benefited from the fallouts of the football World Cup, which took place at the end of 2022. As a reminder, we had a huge success, number of new players at this World Cup event that continued to play on the first part of the year last year. And, secondly, it also benefited from a greater number of championship days as the calendar was adjusted post-World Cup. As a reminder, to be able to organize this World Cup in November and December, some events have been done priorly and some events have been postponed post-World Cup, and we had benefited from that in the first quarter of 2023. On the online part of the online gaming, the online business is buoyant, with online sports betting, namely pari-mutuel, revenue up by more than 25%, driven by the intrinsic dynamism of the offer, but also by the attractiveness of the poker offering, with now nearly 20% of online sports betting players also playing poker, as you can see on the slide. And we are very happy with the poker performance, really. Very good as such, but it also encouraged cross-selling, helping to reduce churn and boost stickiness, exactly what we set out to achieve. And on the next slide, some words about Kindred. And as I said at the start of the presentation, the Kindred tender offer launched on January 22nd was opened on February 20th for 39 weeks, i.e., a closing date, very precise, on Tuesday, November 19th. It remains subject to regulatory approvals, including the authorization from the French Competition Authority. And at its general assembly on March 15th, Kindred shareholders approved the amendment to the company's bylaws to allow a squeeze-out above 90% capital ownership threshold. On March 28th, FDJ exercised its preemptive right linked to Veralda's irrevocable commitment, and acquired 1.12% of Kindred shares at a price of SEK 122.5 per share. The irrevocable commitments made by four main shareholders, namely Corvex, Premier Investissement, Eminence Capital, Nordea, and Veralda, now represent 26.82% of Kindred's capital. So globally, everything is on track. Maybe to conclude on Kindred and regarding the motions voted yesterday by the Dutch parliament, as a representative that you may have noticed, let me share with you the following. Firstly, we are talking of motions. It's two out of 5,000 yearly, on average, which must be addressed by the government to see if they deserve being turned into law proposals, and motions are not legally binding. It's clear then, more than a year after the Dutch market opening or liberalization, the local regulator and ministries are considering what is the right level of regulation, which of course can be the current one. Regarding a further advertisement ban for online gaming, we do not consider it materially impactful, and as you know, in each such case, it clearly benefits market leader. You know that Kindred is a clear market leader in the Netherlands. Regarding banning high-risk money games, not to say slot games, this will just be a dramatic move backward and would open the door again to gambling via illegal, unregulated offers or operators. The Dutch Minister has already started what he stated, that he did not agree with such a ban. In conclusion, ultimately it would be a very long process with an unclear outcome at this stage, and to some extent related to the ongoing political changes in the Netherlands, as in parliament, three of the four main parties expected to be part of a new government voted against these motions. Regarding the slot games ban, it really would be surprising to see such a backward move in the wake of the market opening, as it contradicts all the objectives, channelization, player protection, and tax revenue. Everybody acknowledge that regulated operators are committed to player protection and channeling play to authorized practice, and you know our clear commitment on player protection also. So as of today, most of the foreseeable impacts seems to be factored in the current guidance and expectations. What I can say to conclude really is take on and carry on, as would have said some famous British prime minister. On the next, last slide, a word about our upcoming meetings with investors. Our general meeting of shareholders will be held in a week's time on April 25th, at 2:30 P.M. CET. At this meeting, shareholders will be asked to approve a dividend of EUR 1.78 per share for 2023, and as a reminder, it's a dividend up 30% on the dividend paid for 2022, and this dividend will be paid on May 7th. Our H1 results will be published on Thursday, July 25th, after the close of trading and just before the beginning of the Olympics in Paris. To conclude, I would simply like to express our confidence in achieving our 2024 objective with, if I recall, revenue growth of around 8% based on growth of around 5% in our lottery and sports betting business in France, as well as online gaming open to competition. And a recurring EBITDA margin of around 24.5%, in line with our 2025 target of an EBITDA margin of at least 25%. I thank you very much for your attention and, I am now ready to answer your questions. Thank you. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. We have our first question from Ed Young, from Morgan Stanley. Your line is open. Please go ahead. Thank you. I've got three questions. I did have one on the Netherlands, but, Pascal, that was extremely comprehensive, so thank you for that very useful answer on, on that. The first question I had was on your online performance, as you say, was notably stronger than it's been in the past. I think if we go back to thinking about how you framed, maybe some of the more, challenging period on online, you've said that you realized a lot of your customer acquisition was maybe reliant on, high jackpots or long cycles, however we phrase it, to generate interest. But it seems like EuroDreams, maybe in particular, has really helped grow that. So can you talk a little bit about if that's the right way to think, that that's been the main difference, or if there are other things about your acquisition into online lottery or cross-sell from that, that's helped boost that business to a much stronger growth rate? That's my first question. Okay. Yes, what we can say that you're right, EuroDreams is helping stabilizing a high level of of activity online, not depending on the jackpot phases of EuroMillions. This is true. Secondly, we have a stronger and stronger instant games offering, and last year we had a very heavy growth on the instant games, and we still have a very big growth on our instant games, and they do not directly depend on the EuroMillions jackpots. So this is the result of the work that we have begun two to three years ago, and we have expressed that publicly to you, our analysts and investors, that we will try on the medium term to be less dependent from EuroDreams. But I have to say also that the basis of comparison on the first quarter of 2023 was solid, but not exceptional. And last year we had some quarters where we had to compare to exceptional levels the year before, 2022. So it was solid, the Q1 with quite a good results last year, but not exceptional. So, when we do not compare to exceptional periods, as we have also communicated previously, the intrinsic growth of our online lottery is something like mid-teens, and we are a little bit over mid-teens this quarter. So it's good, but it's in line with what we expect in average, if we don't have exceptional events. Very useful. My second question was, if you could perhaps help quantify the Euro's benefits coming up in June, and perhaps to a much lesser extent relevant, but maybe asking the same in the same way, Olympics. Obviously, we had the World Cup, but it was on a different calendar and a different event. So I wonder if you have any thoughts about how we think about the potential benefit you'd get in Q2 and into Q3? Yes, yes, it's a good, interesting question. So, if you recall what we said about the World Cup of 2022, which is a good point of comparison, this World Cup had an impact of something like 6% of the yearly GGR. So we can expect an impact of this level, kind of level. What is good about the Euro 2024. What is less interesting than the World Cup is that we have less, a lower number of events, of matches, as we have less competitors in the Euro than in the World Cup. This is an element, a negative element, but the positive element-... is that it's more likely to drive additional business as the World Cup in November, December, was placed at a moment where the offer was really good, even without World Cup. To have a European Championship in June, July, is a good thing, especially for the point of sales, as the offer is quite weak at this period. It's less the case on the online offer that is more complete. But on the point of sales, it is the case, and this is a good thing. So you can expect maybe something like EUR 400 million stakes on type of event, or like that. The revenue will depend on the level of the payout, which is quite uncertain, and will depend also on the fact that France will go to the end of this competition or not. But even if France goes very far in the competition, and the payout is very high, we have six months to normalize it after that. And we will for sure take the opportunity to recruit a lot of new players at this moment. So it will be, in all case, a good thing for us. And one word about the Olympics. The Olympics is clearly less attractive for our players than can be Euro. Maybe if I can do some comparison, we expect for the Olympics something like we had for a World Cup of Rugby, for example. But the, the- One tenth. Yes, something like 1/10 of the level of European or a World Cup of football, something like that. But it's... We think it will be more significant than it has been in the past, but still, it's only two weeks, and it's mainly sports that are not have not a huge base of experts, apart from basketball or football or some sports like that. It's not the same like as a European Championship or of football or a World Cup. Very clear indeed, sir. Thank you. But my very final one, I apologize. I know it's a customary question, which will get a customary answer, but I have to check. Have you got any update on the European Commission investigation? Thanks. If I want to be short, I can say just, no. No, but we still are in the same position that we had two months ago during our 2023 full-year communication. Saying that we cannot be sure of that, but we expect that we get an outcome before the new commission will be put into place at the end of summer. Back to school. Beginning back to school period. As we have understood that, they expect to put this file behind them, and not let it treat by the new commission that will be put in place, back to school in September. So that's all. Okay. Thank you. Yeah, no commitment from us. Yes. Yes. Very important what Marc says, gut feeling, but no commitment really. We don't, we don't have any impact on this, this, on this decision. It's just, we would think that it would be a good thing and logical, but illogical is something to do with that. Fear of investigation. Mm. Yeah. Understand. Still useful to have your, have your thoughts. Thanks very much. Our next question comes from Andrew Tam, from Redburn Atlantic. Your line is open. Please go ahead. Hi, thanks for taking my questions. Ed, Ed's kind of jumped on most of my ones, but just in terms of the potential ban for online slots, can I just clarify, are you saying you're ascribing a zero probability for that to potentially come in? And I guess my question is, should that indeed actually come to pass, does that change your views on the Kindred acquisition? Yeah. So clearly, no, it is not changing our views on the Kindred acquisition. We have to be prepared to have some headwinds in certain jurisdictions. This is a non-event, really, because it's just a motion, as I explained. And this motion is clearly not consistent with what has been put in place quite recently by the Netherlands government. And as I said, I think if we come back to the objective of what the Netherlands government, they wanted to channelize the consumption of online game into channel with regulated and controlled offer and operators. They wanted to have a better player protection with a regulator, making sure that everything is done correctly to prevent gambling addiction. And thirdly, they expected some tax revenue. If they choose at the end prohibition, they would lose on every one, on all the three aspects, so it's totally inconsistent. So this is why we think that we should not, we should stay calm, as I said. Looking at that, it's for us more a non-event, and we will have some, because in some jurisdiction, you will have people that are against gambling by nature, and they will say things like that. But just, back to reality and back to objective, it will be really inconsistent. Got it. No, that makes sense. And just a side question related to it, obviously, there are still customer deposit limits that are still meant to be looming. Kindred's been curiously silent on this. Does this mean that there's little to no impact on the Kindred business or your views on the profitability of that business going forward? Yeah, on the deposit limits, we have factored what the regulation of the Netherlands requires. We know also that there is some discussion put in place to do more about affordability checks on customers. Very difficult to have a view on that, as it is not- it has not been discussed precisely what they want to do. What we can say about that is that having a better player protection is not a bad thing for us, and we think for Kindred and for us with Kindred tomorrow. So, today we don't expect any downwards or problems linked to that. But, again, let's see precisely what the government want to do, with affordability checks, et cetera. We don't know precisely what they have and what they want to set, but really, on this point also, keep calm. And, again, the position of Kindred in Netherlands is a good position, as it's the position of leader. They are, I think, the less... They would be the less impacted if something happens in this, in this jurisdiction. And again, our positioning, Kindred is doing what they want today, as we are two different companies at this stage. But when FDJ will be there, clearly the positioning that we want this company to have is clearly to protect the players, and protecting the players, we think is a good strategy for a sustainable medium-term growth. Got it. And then just finally, just in terms of the change in the macro environment, and the potential for the interest rate outlook, does that change, you know, your ability to refinance the bridge, in relation to Kindred deal? Does that change any of the accretion guidance at all? Yeah. We really don't fear anything refinancing the bridge. Currently, what we have done is syndicating the bridge that was put in place with two banks, and we add 1.5 x the money that we need for the refinancing. We have to choose between a number of banks that was fighting to be part of the syndicate. And they wanted to be part of the syndicate because they wanted to be part also of the takeout after that. Today, we are in the position of hedging the Forex and the interest rates. Nothing really bad for us, and we still are very confident on the fact that we will be able to refinance in good way this bridge as soon as we will take control of Kindred. Significantly at a lower rate than the one we have taken in our business model projection and the projection we've shared with you on the 22nd of January. Yes, we have been cautious, and, the tax rates are going, in, Direction. Direction. Interest rates, sorry. Interest rates are going in the right direction, and we expect some good news. Fantastic. That's all my questions. Thank you very much. Thank you. Our next question comes from Kiranjot Grewal from Bank of America. Your line is open. Please go ahead. So can I just confirm, within your expectations for Kindred, you've made no changes for the latest regulations? And in the context that you do, it is passed and the slots are shut down, what do you anticipate the impact to be? ... What I said is that we don't expect finally that slots in the Netherlands will shut down, so we don't take this, this of this potentiality into consideration as we think this is totally improbable. What we factored in the business plan is that we know that a number of jurisdiction have regulations that are more and more demanding. For example, we know that in the U.K., we will, we have to comply to a white paper that is enshrining much more control, much more limits on the different players. It's the same in the Netherlands, with the limits that are going down. And what we have, we thought that it was good in the Kindred strategy, is that they have made their revolution, if I may put it like that. Not basing their core business on high roller gamblers, but on medium-sized gamblers, which is much more safer regarding the changes on the potential changes on regulation. To have regulation that are demanding more and more is the base of our business. It's the case also in France, and our job is to navigate this these changes in the regulations with no downwards on our growth expectations. It means that we have to do good business with our clients, business with clients that are not in a risk of addiction. This is a commitment that we have taken already in France. We are doing that. We have seen last year in France, in our activity, that we have been able to, at the same time, grow and lower the level of players that are high-risk players. This is clearly our strategy, and this strategy, I think, is a good mitigation of the regulatory risk on different jurisdictions. Okay, thank you. Our next question comes from Johanna Jourdain from ODDO. Your line is open. Please go ahead. Yes, good evening. Two questions on my side. So on the Kindred proposed acquisition, where do you stand in the process, in particular on the discussions with the antitrust authorities in France and in Poland? And my second question, still on the Netherlands regulation, does that bans or those bans could change your view on the acquisition of Kindred? So you have already answered that, but resulting in the usage of a material adverse change clause, for instance, or to amend the price that you have already proposed. Thank you. Okay. Okay, so on your first question, where we stand regarding the antitrust notification, we are in the right path. We have done all what we have to do, pre-notification very quickly after the announcement. And we are in France, which is the main the main subject in into this period of pre-notification. It works like that in France. We answer a bunch of questions from from the antitrust, and at this stage no no no problem that we we we can we we have on on this on this path. And we still expect that we will have a positive outcome at the right timing in in in the in the autumn. So yes, I will say exactly the same thing that I've already said on the Netherlands. Again, we don't think that it's really credible to forecast a ban on slots, on online slots. But yes, we have such in-market for circumstances that are having a material adverse effect, but really, it's not the point now to envisage this kind of atomic bomb thing. But yes, we have done what is needed, but you know, also the difficulty to put in place those kind of elements. And I think, yes, thank you, Mark. On Poland, we had the okay. So the subject is France, and again, it's all going on as it is expected. Yeah. Poland was a no-brainer. Yes. Yes. Can you still hear us? Allô. Operator? Yeah. Yes, we can still hear you. We're still here, yeah. Just a final reminder, ladies and gentlemen, if you have a question, please press star one on your keypad now. So we have our next question from Andrew Tam, from Redburn Atlantic. Your line is open. Please go ahead. ... Hi, just a follow-up to that last question. I, I don't think I quite heard correctly. Did you say, can you just confirm that there are indeed, Material Adverse Change clauses available to you? I, my understanding was you could not, pull out of the acquisition, but there are clauses available to you. Is that correct? We have a MAC clause in our deal. Got it. Okay, thank you. But again, usually it's very hard to put it in place, so don't, don't be too optimistic about that. Understood. Thanks. I don't think that we will have to go there. Again, we think that the probability of an atomic bomb falling into the event is very low. We are very far from reaching this stage. Yeah. Yeah. Perfect. At this stage. There are no further questions in the queue, so I will hand you back over to Mr. Pascal Chaffard to conclude this conference. So thank you very much for your attention tonight. Hope that we have correctly answered all your questions. And I will be happy to see you physically or maybe online at our AGM next week. And I will also be happy to comment our H1 results by the end of July. So, have a good evening, and see you very soon. Goodbye to you all. Thank you for joining today's call. You may now disconnect.