Slides
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December 17, 2024
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer
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Sophie BELLON Chairwoman and CEO Chairwoman of the Meeting François-Xavier BELLON representing Bellon SA Scrutineer 3 Florence NEGREL Board Secretary Secretary of the Meeting Véronique DEBARGE representing the FCPE Groupe Sodexo Peps for Sodexo employees Scrutineer On the stage Sébastien DE TRAMASURE Group Chief Financial Officer Statutory Auditors Caroline BRUNO-DIAZ Eric ROPERT KPMG Aymeric DE LA MORANDIÈRE Soraya GHANNEM ERNST & YOUNG Audit Members of the Bureau
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Florence Negrel Board Secretary
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▬ Message from the Chairwoman and CEO ▬ Fiscal 2024 Results ▬ Outlook and ambition ▬ Corporate governance ▬ Statutory Auditors’ Reports ▬ Presentation of the resolutions ▬ Questions/Answers ▬ Vote of the resolutions 5 Agenda 5
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer
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7 7 Key figures for Fiscal 2024 23.8 billion euros in revenues +7.9% in organic revenue growth 4.7% in UOP margin (+40 bps) 1.9 billion euros in new development
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▬ Food services in the world’s largest restaurant 40,000 meals a day for 15,000 athletes 24/7 ▬ Food services for spectators 14 competition venues (8 for the Paralympic Games) 8
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Simplify and refocus Sodexo Spin-off and listing of Pluxee Sale of Sofinsod 9
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2025 Strategy 10
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New production and distribution food models Prêt à cuisiner Colina Masterkitchen 13
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15 15 @SodexoGroup
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16 High-value FM services to enrich on-site experience 16
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17 Progress on emissions -2.5% yoy scope 1, 2 & 3 GHG emissions Food waste down -40.7% reduction on sites representing 76.9% of total food Raw Material Cost (vs. 57% in FY23) A better place to work Vita deployment on track to reach 60% coverage target A safer place to work 0.47 LTIR (-14.5% vs. FY23) An inclusive place to work 41% of women in Senior Executives roles 17 People Planet Sustainability performance
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Sébastien de Tramasure Group Chief Financial Officer Fiscal 2024 Results
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20 Organic growth +7.9% Revenues €23.8bn Food Services +9.3% UOP Margin 4.7% +40 bps Underlying Net income +17.6% Financial leverage 1.7x vs 2.2x in FY23 Free Cash Flow €661m Strong financial delivery in FY24 Sodexo continuing activities
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▬ Price adjustments to pass through inflation ▬ Good contribution of net new business ▬ Positive like-for-like volume growth fueled by rising demand for ongoing return to the workplace and upgraded services ▬ Strong performance of Sodexo Live! 21 Solid and balanced Organic Growth across all regions North America +8.7% 47% of FY24 revenues Europe +7.2% 35% of FY24 revenues Rest of the World +7.3% 18% of FY24 revenues
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22 UOP margin progress driven by operational efficiency and HQ cost reduction +30bps Group North America Europe Rest of the World HQ costs 5.3% 5.6% 5.9% 3.9% 3.7% 4.0% 4.3% 4.7% 4.9% -0.6% -0.4% -0.4% 4.0% 4.3% 4.7% Year-over-year UOP margin progress at +40 bps, driven by: ▬ Operating leverage from higher revenue ▬ Enhanced site productivity and supply efficiencies ▬ Rigorous above-site cost control ▬ HQ costs fell by -11% Fiscal 2022 Fiscal 2023 Fiscal 2024
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23 Cash generation and debt reduction 326 374 661 2022 2023 2024 Free Cash Flow +77% Net debt 3,508 2,918 2,600 FY22 FY23 FY24 Net debt / EBITDA 3.4x 1.7x2.2x EBITDA and margin 1,140 1,335 1,489 FY22 FY23 FY24 Figures in €m unless otherwise stated ▬ Reduced net debt-to-EBITDA ratio to 1.7x ▬ Repayed €800m Bonds in 2024 without refinancing, using our cash surplus ▬ Strong Investment Grade - S&P “BBB+/A-2” +11.5%
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24 Attractive shareholder returns in the last few years Special interim dividend €6.24 Ordinary dividend €2.65 Total dividend per share proposed for Fiscal 2024 Dividend per share in euros 1.80 2.25 2.65 6.24 FY22 FY23 FY24 50% Payout ratio 50% Payout ratio 50% Payout ratio Special interim dividend Annual Total Shareholder Return 12% 33% 29% FY22 FY23 FY24
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25 A balanced capital allocation strategy CAPEX 2.5% of revenue DIVIDEND 50% of Underlying net income M&A 300-500 m€ average per year
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26 Group share price +16% over the past 12 months, outperforming the CAC40 index Share performance from December 15, 2023, to December 15, 2024 60 65 70 75 80 85 Sodexo +16.3% CAC40 -2.5%
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer Outlook and ambition
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28 Outlook for Fiscal 2025 Organic Growth +5.5 % to +6.5 % UOP margin +30 to +40 basis points at constant currencies
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer Corporate governance
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30 Corporate governance (video)
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Luc Messier Lead independent Director Fiscal 2024 Activity Report
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32 ▬ Member of the Audit Committee ▬ Member of the Nominating Committee ▬ Member of the Sustainability Committee ▬ Attending the sessions of the Compensation Committee ▬ Organizing and conducting the executive session, in the absence of the management and employee representatives
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33 Summary of Fiscal 2024 ▬ Monitoring the actions resulting from the 2022 and 2023 evaluations ▬ Creation of the Sustainability Committee ▬ Strategic seminar ▬ Contribution to the development of the training plan for Directors ▬ New internal evaluation of the work of the Board and its Committees
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34 Summary of Fiscal 2024 ▬ Consultation on agendas ▬ Organization of an executive session ▬ Dialogue with shareholders, investors and proxy advisors ▬ Prevention of conflicts of interest
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35 Summary of Fiscal 2024
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Cécile Tandeau de Marsac Chairwoman of the Compensation Committee
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37 11th resolution Approval of the compensation policy applicable to the Directors 12th résolution Approval of the compensation policy applicable to the Chairwoman and CEO Ex ante Say on Pay resolutions 9th resolution Approval of the components for compensation paid during or awarded for Fiscal 2024 to Sophie Bellon 10th resolution Approval of the information related to the compensation of Corporate Officers and Directors Ex post Say on Pay resolutions Compensation elements submitted to the vote
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38 Chairwoman and CEO’s compensation Fiscal 2024 Fiscal 2023 Fiscal 2024 Fixed compensation €900,000 €900,000 Variable compensation €966,195 €448,200 Long term compensation €1,784,516 €1,978,368 Benefits in kind (company car) €1,123 €1,271 Total €3,651,834 €3,327,839 9th resolution
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Achieved Amount (in €) 70% based on financial criteria Organic growth 7.9% 0 Client retention 94.2% 0 Underlying operating profit margin (at constant exchange rates) 4.7% 0 Group net income €738m 0 Free cash flow €661m 178,200 Total financial targets - 178,200 30% based on non-financial criteria CSR criteria Health & Safety • LTIR 0% 0 • NMIR 100% 54,000 Deployment of the WasteWatch program 100% 108,000 Talent management Loyalty of executives 100% 36,000 Gender diversity in Operations 100% 36,000 Internal promotion rate 100% 36,000 Total non financial targets - 270,000 Total variable compensation for Fiscal 2024 - 448,200 39 Chairwoman and CEO’s compensation Fiscal 2024 9th resolution Variable compensation
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Weight Maximum 50% Economic performance Organic revenue growth over Fiscal 2024, 2025 and 2026 20% 100% Underlying operating profit margin (excl. currency effect) for each of Fiscal 2024, 2025 and 2026 30% 100% 20% CSR performance Gender diversity 1/3 : % of GSE women 2/3 : % of GSE women in operations 10% 100% Sustainable development 1/3 : % of food waste reduction 1/3 : % of electric, hybrid or alternative fuel vehicules 1/3 : % of vegetarian and/or plant-based dishes 10% 100% 30% Stock performance Relative TSR – Sodexo TSR ranking compared to a peer group (Aramark, Compass, Elior, ISS, Rentokil and Securitas) over 3 years 30% 100% TOTAL FOR FISCAL 2024 100% 100% 40 Chairwoman and CEO’s compensation Fiscal 2024 Allocation of 34,500 performance shares 9th resolution
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41 Chairwoman and CEO’s compensation Fiscal 2025 – target structure 12th resolution
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42 Chairwoman and CEO’s compensation policy Fiscal 2025 12th resolution Evolution compared to the 2024 compensation policy ▬ Review of the comparison peer groups in Fiscal 2024 The other components of the compensation are unchanged: ▬ A supplemental pension plan; ▬ Collective health and benefit plans; ▬ Benefits in kind (company car). Peer Group France Peer Group International • 20 smallest market capitalizations in the CAC 40 • Companies of the CAC Next 20 index, excl. banks and insurance companies • 8 companies: Accor, Adecco, Aramark, Compass, Elior, ISS, Randstad, Securitas
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43 Directors’ compensation Fiscal 2025 11th resolution ▬ Annual envelope of 1,300,000 euros; ▬ 78% of the annual envelope used in Fiscal 2024 ▬ Unchanged allocation: Fixed Additional fixed compensation for the Lead Director Additional fixed compensation for chairing a committee Variable (per attendance) Board of Directors €20,000 €30,000 €4,500 Audit Committee 8,000 €25,000 €3,500 Nominating Committee 6,000 €22,500 €3,000 Compensation Committee 6,000 €22,500 €3,000 Sustainability Committee 6,000 €22,500 €3,000
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Caroline Bruno-Diaz KPMG Statutory Auditors’ Reports
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Purpose of our engagement: obtain reasonable assurance ▬ that the financial statements are free of material misstatement, ▬ comply with the applicable accounting standards, regularly and sincerely, and ▬ give a true and fair view of the consolidated Financial Statements of Fiscal 2024, of the assets and liabilities of the Group’s / Company’s operations for the year then ended. Accounting policies applied ▬ Consolidated financial statements: IFRS as adopted by the European Union. ▬ Individual Company financial statements: French GAAP. 45 Reports on the consolidated and individual company financial statements Pages 174-178 and 197-200 of the Universal Registration Document Unqualified opinion
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Key audit matters Matters requiring particular attention during our audit and which we consider to be the most significant: Consolidated financial statements: ▬ Measurement of the recoverable amount of goodwill, ▬ Tax risks. Individual company financial statements: ▬ Valuation of equity investments. A detailed description of the risks identified to these key audit matters, and our responses thereto, can be found in our reports. 46 Reports on the consolidated and individual company financial statements Pages 174-178 and 197-200 of the Universal Registration Document
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47 Reports on the consolidated and individual company financial statements Pages 174-178 and 197-200 of the Universal Registration Document * Information in this statement have been verified by EY & Associés as Independent Third Party (see pages 95 to 97 in the Universal Registration Document). Information Nature and extend of our verifications Conclusion Management Report Fair presentation and consistency with the financial statements We have no matters to report Consolidated non-financial statement* Statement included in the management report* We have no matters to report Information's required by articles L.225-37-4, L.22-10-10 et L.22-10-9 of the French Commercial Code Information included in the report on corporate governance We have no matters to report Information relating to compensation and benefits paid or awarded to corporate officers and any other commitments made in their favor Consistency with the financial statements or with the underlying information used to prepare these financial statements We have verified its accuracy and fair presentation Information on those items your Company has deemed liable to have an impact in the event of a takeover bid or exchange offer Consistency with the underlying documents We have no matters to report Information about customers/suppliers’ payment terms Fair presentation and consistency with the financial statements We have verified the consistency and fair presentation of these information European Single Electronic Information Format (ESEF) Conformity verification of the tagging of the consolidated accounts in the ESEF format We have no matters to report Specific verifications
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Agreements to be approved by the Shareholders Meeting ▬ Agreement for the sale of the Sofinsod shares between Sodexo S.A. and Bellon S.A. Nature and purpose: On July 23, 2024, Sodexo’s Board of Directors authorized the conclusion of an agreement pursuant to transfer to Bellon S.A. all the shares making up the capital and voting rights of Sofinsod S.A.S. Terms: the conditions of the agreement mainly include: ▬ Sofinsod S.A.S., which has for sole asset on its balance sheet a 19.6% stake in Bellon S.A., valuated at 917,908,704 euros (sale price); ▬ the sale agreement provides that the entire sale price would be distributed to Sodexo’s shareholders through an interim dividend occurring on August 29, 2024. Reasons: Sodexo’s Board motivated this agreement as follows: Sodexo was continuing discussions with Bellon S.A. with a view to organizing the unwinding of the cross-shareholding loop, in particular through the transfer of 100% of the Sofinsod shares held by Sodexo to Bellon S.A. to simplify the shareholder structure and monetize an illiquid asset. Agreement already approved by the Shareholders Meeting ▬ Service agreement between Sodexo and Bellon SA: Bellon SA invoiced 5,131,113 euros excluding taxes to Sodexo SA during the fiscal year ended on August 31, 2024. 48 Special report on related-party agreements Pages 201-202 of the Universal Registration Document 48
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Report on the share capital reduction (14th resolution) ▬ We have no matters to report on the reasons for and terms and conditions of the proposed share capital reduction by cancelling treasury shares. 49 Special report on the 14th resolution submitted for approval at the Extraordinary Shareholders Meeting Page 69 of the Convening Notice 49
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Florence Negrel Secretary of the Board of Directors Presentation of the resolutions
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51 1st and 2nd resolutions Adoption of the individual company financial statements for Fiscal 2024 ▬ Net income of 1,545,281,879 euros. Adoption of the consolidated financial statements for fiscal 2024 ▬ Group net profit of 168 million euros.
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52 3rd resolution Appropriation of net income for Fiscal 2024 and determination of the dividend amount to 8.89 euros per share including: ▬ the special interim dividend of 6.24 euros paid on August 29, 2024, and ▬ the ordinary part of the annual dividend of 2.65 euros which will be paid on December 23, 2024. Dividend premium of 10% of the dividend for the shares held in registered form for at least four years (within the limit of 0.5% of the share capital per shareholder).
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53 4th resolution Approval of a related-party agreement ▬ Approval of the agreement entered into on July 23, 2024 for the sale by the Company of all the shares in Sofinsod to Bellon SA. ▬ Conclusion of the agreement authorized by the Board of Directors: • on the recommendation of the ad hoc committee composed of four independent Directors, and • based on the report of an independent expert. ▬ Sale of Sofinsod whose only asset in its balance sheet was a 19.6% interest in Bellon SA. ▬ Sale price of 918 million euros, fully distributed to shareholders in the form of an interim dividend paid on August 29, 2024.
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54 5th and 6th resolutions Renewal of Directors for a three-year term ▬ François-Xavier Bellon ▬ Jean-Baptiste Chasseloup de Chatillon Detailed information available pages 224 and 227 of the Universal Registration Document
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55 7th and 8th resolutions Appointment of auditors responsible for certifying sustainability information ▬ ERNST & YOUNG Audit ▬ KPMG
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56 9th to 12th resolution Approval of the elements of compensation paid or allocated to corporate officers for Fiscal 2024 ▬ Chairwoman and Chief Executive Officer ▬ Executive Officers Approval of the remuneration policy for directors and the executive corporate officer for Fiscal 2025 ▬ Directors ▬ Chief Executive Officer Information presented by the Chairwoman of the Compensation Committee and detailed pages 261 to 278 of the Universal Registration Document
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57 13th and 14th resolutions Authorization for the Company to purchase its own shares ▬ Maximum purchase price: 105 euros per share. ▬ Limit: set by the company at 10% of the share capital as of December 17, 2024. ▬ Validity of authorization: 18 months. Cancellation of treasury shares ▬ Limit: set by the company at 10% of the share capital as of December 17, 2024 ▬ Validity of authorization: 18 months.
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58 15th resolution Amendments to article 11 (deliberations of the Board of Directors) of the Company's bylaws ▬ In accordance with law no. 2024-537 of June 13, 2024, known as “Attractiveness”.
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59 16th resolution Powers to carry out legal formalities
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60 E-convocation and e-voting available DIGITAL SIMPLE GREEN QUICK
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer Questions/Answers
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Florence Negrel Secretary of the Board of Directors Vote on the resolutions Combined Shareholders Meeting
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63 1st resolution Vote on ordinary resolutions Adoption of the Individual Company Financial Statements for Fiscal 2024 ▬ Net income: profit of 1,545,281,879 euros. 63
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64 2nd resolution Vote on ordinary resolutions Adoption of the Consolidated Financial Statements for Fiscal 2024 ▬ Group net profit of 168 million euros. 64
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65 3rd resolution Vote on ordinary resolutions Appropriation of net income for Fiscal 2024; determination of the dividend amount and payment date ▬ Dividend of 8.89 euros per share for Fiscal 2024 including: • Special interim dividend of 6.24 euros per share paid on August 29, 2024, and • Ordinary part of the annual dividend of 2.65 euros to be paid on December 23, 2024. ▬ 10% dividend premium for registered shares held for at least 4 years (limited to 0.5% of the share capital per shareholder). ▬ Calendar for the payment of the ordinary part of the annual dividend: • Ex-dividend date: December 19, 2024, • Payment date: December 23, 2024. 65
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66 4th resolution Vote on ordinary resolutions Approval of a related-party agreement relating to the sale by the Company of all the shares in Sofinsod to Bellon SA ▬ Approval of the agreement entered into on July 23, 2024. ▬ Conclusion of the agreement authorized by the Board of Directors: • on the recommendation of the ad hoc committee composed of four independent directors, and • based on the report of an independent expert. ▬ Sale of Sofinsod whose only asset in its balance sheet was a 19.6% interest in Bellon SA. ▬ Sale price of 918 million euros, fully distributed to shareholders in the form of an interim dividend paid on August 29, 2024. 66
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67 5th resolution Vote on ordinary resolutions Reappointment of François-Xavier Bellon as a Director for a three-year term ▬ End of term: Shareholders Meeting held to adopt the financial statements for Fiscal 2027. 67
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68 6th resolution Vote on ordinary resolutions Reappointment of Jean-Baptiste Chasseloup de Chatillon as a Director for a three-year term ▬ End of term: Shareholders Meeting held to adopt the financial statements for Fiscal 2027. 68
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69 7th resolution Vote on ordinary resolutions Appointment of ERNST & YOUNG Audit as statutory auditor, responsible for certifying sustainability information ▬ As part of the implementation of the CSRD Directive. ▬ Choice to appoint both auditors responsible for certifying the accounts. ▬ For the remaining duration of their respective term of office 69
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70 8th resolution Vote on ordinary resolutions Appointment of KPMG SA as statutory auditor, responsible for certifying sustainability information ▬ As part of the implementation of the CSRD Directive. ▬ Choice to appoint both auditors responsible for certifying the accounts. ▬ For the remaining duration of their respective term of office. 70
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71 9th resolution Vote on ordinary resolutions Approval of the components of compensation paid during or awarded for Fiscal 2024 to Sophie Bellon, Chairwoman and CEO ▬ Detailed information available in section 7.4.2 in the Fiscal 2024 Universal Registration Document and provided by the Chairwoman of the Compensation Committee during the Shareholders Meeting. 71
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72 10th resolution Vote on ordinary resolutions Approval of the information related to compensation of corporate officers and directors, as referred to in article L.22-10-9 I of the French Commercial Code ▬ Detailed information available in section 7.4 in the Fiscal 2024 Universal Registration Document and provided by the Chairwoman of the Compensation Committee during the Shareholders Meeting. 72
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73 11th resolution Vote on ordinary resolutions Approval of the compensation policy applicable to the Directors ▬ Detailed information available in section 7.4.1 in the Fiscal 2024 Universal Registration Document and provided by the Chairwoman of the Compensation Committee during the Shareholders Meeting. 73
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74 12th resolution Vote on ordinary resolutions Approval of the compensation policy applicable to the Chief Executive Officer ▬ Detailed information available in section 7.4.1 in the Fiscal 2024 Universal Registration Document and provided by the Chairwoman of the Compensation Committee during the Shareholders Meeting. 74
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75 13th resolution Vote on ordinary resolutions Authorization for the Board of Directors to purchase shares of the Company ▬ Purpose: • To cover restricted share plan, • To enable capital reduction through cancellation of shares, • To carry out market-making in Sodexo shares. ▬ Maximum purchase price: 105 euros per share. ▬ Limit: 10% of the share capital as of December 17, 2024. ▬ Validity of the authorization: 18 months. ▬ Not during a takeover bid. ▬ Cancels and replaces authorization granted by the shareholders on December 15, 2023, in the 15th resolution. 75
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76 14th resolution Vote on extraordinary resolutions Authorization for the Board of Directors to reduce the Company’s share capital by cancelling treasury shares ▬ Limit: 10% of the share capital as of December 17, 2024. ▬ Validity of the authorization: 26 months. ▬ Cancels and replaces the authorization granted by the shareholders on December 15, 2023, in the 20th resolution. 76
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77 15th resolution Vote on extraordinary resolutions Amendments to article 11 (deliberations of the Board of Directors) of the Company's bylaws ▬ Compliance with the “Attractiveness” Law ▬ Provide for the possibility for any director to object to the use of a written consultation in the bylaws 77
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78 16th resolution Vote on ordinary resolutions Powers to carry out formalities ▬ Powers to perform legal formalities. 78
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Sophie Bellon Chairwoman of the Board of Directors and Chief Executive Officer
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December 17, 2024