Automatic Data Processing, Inc. Price & Performance (ADP)

And good morning, ladies and gentlemen. Thank you for joining us. I am honored to stand before you today as a newly appointed Chairman and CEO of Grundypic Gruppi Dipi.

I use to comment [indiscernible] Adipay's financial result alongside August and Romania. So first, And foremost, would like to pay tribute to his work and the head of the company for twelve years he has made great efforts to improve quality of service on our Aéroports, He has turned the group into an international player and positioned It as a leader and pioneers in the environmental transition of airline industry. His strike record speaks for itself. As a result, for all to see. One more personal note, I would like Also, [indiscernible] for his confidence, and I have been proud to work alongside him on projects that I have shaped the company and the industry in France It's a privilege to succeed him as Chairman and CEO of EDP. And to meet the challenges and opportunities that lie ahead. Group EDP Has this changed? And a solid team to project health safety into the future. It's this team of passionate people that makes me so enthusiastic about my new role. And my side, this morning, in this new [indiscernible] [indiscernible] from our previous position as Director of Ole Airport Since '20 She also previously served as Deputy CFO from 'sixteen to 'seventeen.

Justine, I will let you introduce Thank you, Philippe. Good morning. It's a pleasure to speak with you, and I'm both honored and delighted that the Board of Directors appointed me as Deputy CEO of Group A. D. Pei. I would like first to thank the Board and Philippe for their trust and I look very much forward to working with them and to leading a committed agile and ambitious team together. The Board entrusted me with the authority of Executive Officer. [indiscernible] under French law. And I will oversee with particular intentions the matters of development and engineering of our platforms, real estate, corporate social responsibility, and environmental transition of our activities worldwide as well as relations with all stakeholders, including national and local authorities. Philippe will comment on his vision. Our shared vision and ambition for Grupo de D'Epee in a few moments. After the financial results presentation, and we'll then be happy to answer your questions during the Q and A. But before that, I'll hand back to Philippe to comment on the 2024 highlights. Thank you. Thank you, Justine. Slide four. Slide four shows the key highlights of the year which we will develop in the next trial.

Traffic has grown in line with our assumption with group traffic exceeding twenty nineteen levels. And price traffic showing strong momentum in international traffic. Group EDP published robust financial results. Have reached or surpassed all of our 2024 targets allowing the Board to propose a dividend of €3 per share. Now on Slide five, The Parisian Aéroports handled traffic successfully during the Paris game last summer. This was achieved by an unprecedented mobilization of our employees and the airport community. As well as operational preparedness, such as increased automation of border controls, improved queue management, early check-in at the Olympic Village and support for passengers with reduced mobility. All these initiatives are lasting and will continue to drive On Hospitality on Slide 06/2024 has been a very strong retail performance. With Extime spend per packs, heightening a new record above €32 I will also highlight the stellar performance of our flagship Terminal 1 International. Where overall spend is getting close to €90 per passenger We continue to deploy Xtai model in Paris, notably with the opening of the Extime exclusive private terminal in CDG, offering the highest possible level of service, attracting and leveraging high end passenger. In 2024, we have also acquired two company Paris Agreement Group and PS.

But we'll allow us to expand X time abroad. And increase travelers funneling [indiscernible] [indiscernible] [indiscernible] Seven. The growth story continue. With double digit traffic growth exceeding 11%. In '24 the company commissioned a new terminal in Almaty Airport and a new X time launch [indiscernible] Showcasing a growth model based on both on airport operation and on service company. TV also continued to work on key capacity projects in Ankara and Antalya. They will be delivered later in 2025 and will support continuing growth [indiscernible] For what? Moving to India, [indiscernible] Gemma Airport is also a growth story. Traffic rose by nearly double digit and key increasing capacity. The key highlight this year is the successful restructuring of the holding company. We are now a direct shareholders of a listed company in India and pivot towards further growth. The market value of our $45,700,000 stake in Gemma Airport is now directly Other operational highlights include JMR award to operate directly is due free area at Delhi Airport from July 25 and tariff increase. Propose [indiscernible] which is now under Stakeholder's Consultation. These are two key levers to improve cash generation going forward.

Moving to Slide nine, I will address sustainability. Which is at the core of our 2025 Pioneer strategic roadmap. Actions contributing to the achievement of the 2025 Pioneers objectives are continuing. On the top part of the slide, you can see, for instance, our progresses on green energies projects. With geothermies in Paris and solar plants in Fora As every semester, we provide an update of our progresses on the 20 objectives of the roadmap. In addition, our annual universal registration document will contain this year our first extra financial report in compliance with the new CSRD directive. [indiscernible] all stakeholders to monitor our actions on material, environmental, social, governance and business ethics matters and compare it with other companies. In terms of decarbonization trajectory, I will highlight that Delhi Airport is the first of our portfolio to reach Level five of the airport carbon accreditation program, which is the highest level of accreditation. Regarding the Parisian platforms, our decarbonization trajectory was validated by the SBTI last October and the CDP recently included ADAPSR in its A List for Climate Matters. So we are on the right track and intend to accelerate the group transformation, both in Paris and internationally, decarbonize our activities And that of the sector globally.

So finally, on Slide 10, you can see that EDP delivered once again solid results both revenue record level. As expected, the reported net result is down due to a negative non cash accounting charge from the operation at JMR level. Excluding such one off, net result is up 16% to €638,000,000 Antoine the floor is used to give more detail. About financial figures. Thank you, Philippe. Thank you, Justine. I will now dive deeper in the 2024 financial results starting with Slide 12. Traffic evolved in line with our growth expectations. In Paris, it is up 3.7%. Reflecting expected trends including disruptions linked to the ATC Systems' experimentations in Q1, and a weak start to summer with some travelers avoiding Paris due to the Olympics. These two impacted the traffic, notably the domestic one. Which is, in any case, experiencing an underlying decline.

Yet, international traffic has seen the highest growth. Particularly with North America, Africa and Asia. With an increased weekly flight schedule, traffic with China more than doubled in 2024 reaching around 60% of 2019 levels. Weekly flights are capped at an unchanged level, and we expect traffic stall at around 6570% in 2025. At the group level, we continue to see strong momentum in the airport operated by TAV and by GMR, showcasing their role of growth relays. Traffic was slightly down, however, at Aman Airport in Jordan, though showing resilience despite its geopolitical context. Slide 13 with Retail. Spend per pack packs reached a new record of €32.1 up almost [indiscernible] 2024 saw outstanding Olympic related advertising travel retail revenue continued performance in Retail and Fashion, despite contrasted trends for each brand and some headwinds in H2 with the reopening of Terminal 2 AC and the less contributive traffic mix during the Olympics. In 2025, the normalization of advertising and intensification of works in Terminal 2E whole K may wait on SPP growth. However, the solid trends we have recorded in 2024 give us confidence and enable us to raise our expectation Spend per packs 2025 is now expected 4% to 6% higher 2023.

Now on Slide 14, revenue reached an all time high of €6,200,000,000 up 12% versus last year. In Paris, Aviation segment grew 7.5% driven by traffic and higher tariffs. Retail and Services segment is up by more than 9% helped by record spend per packs we discussed. Real Estate saw continued solid growth, up 6%. Looking abroad, TIAV Aéroports was the largest contributor to group's revenue growth, driven both by its airport assets and its services companies. AIG recorded stable revenue despite traffic being down in Aman. Moving to Slide 15. OpEx are up 17% due notably to the inclusion of the new infrastructure tax in France, for €131,000,000 and the increase in staff costs notably at TAVR Airports Because Of The High Inflation In Turkey and the rapid growth of the company leading to recruitments. Regarding expenses linked to the Paris games, they are as follows: €41,000,000 spent in 2024, of which €25,000,000 are neutralized at EBITDA level with a reversal of a provision made in 2023. €70,000,000 as part of our partnership with the Olympic Committee which are fully offset by equivalent revenue. The net impact of the Olympics on 2024 EBITDA is hence €16,000,000 All in all, we delivered €2,100,000,000 EBITDA up 6% against 2023.

Surpassing our target. Note that the organic EBITDA growth in Paris activities was eaten up by the introduction of the new infrastructure tax in France as can be seen on the bridge. Hence, EBITDA growth in 2024 is almost entirely attributed to international assets. Slide 16 speaks for itself. Let's move to Slide 17 on net result. As highlighted, net result is down in 2024 largely due to the noncash accounting impact of the GMR merger that we announced in earlier disclosures. Other trends to highlight would be stable D and A with a large impairment reversal at AIG, offsetting all negative effects. An improved financial result due to higher FX gains, gains on cash investments, a positive variation in FCCB valuations. Linked to the higher profit before tax. As the infrastructure tax is not deductible. All in all, as per dividend distribution policy, the Board proposed a dividend of EUR 3 per share to the next AGM. [indiscernible] Slide 18 gives a view of the net result excluding one off effects. On a comparable basis, excluding notably the accounting charge linked to GMR merger operation, as well as for other one offs in 2024, and in 2023, net result would be up more than 15% in 2024.

To €638,000,000 So this is solid organic growth here at the bottom line. Lastly, I will comment on net debt on Slide 19. You can see that leverage remains stable in 2024. Keep in mind that the reported net debt accounts for options on convertible bonds to GMR. Those derivatives value varies with the bond's and GMR's market value. And inflates the Aéroports reported net debt despite bearing no risk of cash outflows for the company. Excluding the value of these derivatives, adjusted net debt stood just above €8,000,000,000 as of thirty one December. With that, let me hand it over to Philippe, who will now comment on our outlook and strategic priorities. Thank you. Thank you, Antoine.

And our solid teams put us in good position for the future. My mission is for Group EDP to become a global reference in attractiveness and hospitality. As well as a model in environmental transition for the air travel industry. So we are going to accelerate in this direction. We've aimed to create value for all of our stakeholders. I am determined to carry out my duty with a concern for the long term, which is the time horizon. Over which our activities date shape and create value. IDP is a unique model We operate the free [indiscernible] which are vital strategic infrastructure for France. And we also operate 26 airports worldwide. We are now entering a cycle that is going to be a little more than in the past. Our economic challenge the value that needs to be created for the company is essentially over the next few years. Reimburseing our economic model requires a signature of an economic regulation contract. Eil will come back to this theme in detail in the next slide. Reinforcing our economic model require that we accelerate the development [indiscernible] [indiscernible] in Paris and internationally. We have laid a foundation and we are going to continue.

It is the second attempt of my strategic focus. [indiscernible] This is why securing our international activities is the third building blocks of the strategy, refocusing an intent to deploy to reinforce our business model. Our international development has greatly intensified since 2017 with the takeover of TAVA Airport, and then in 2020 with the acquisition of a stake in Jama Airport. EBB's international strategy is not only about projection or knowledge. But also about ensuring the overall economic balance of our activities. It is a combination of the two and the search for balance that we built over the long term. That explains EDP international expansion. International developments cost mainly money and first, then [indiscernible] And I also want to make this three strategic priority [indiscernible] [indiscernible] [indiscernible] a stronger, more agile corporate culture. This spirit will be at the heart of the management team [indiscernible] and I will we be building Let's now take a look at what I mean when I tell you that we are entering a cycle that's a little bit more paragon. And what I want to do with the launch of a multiyear agreement in Paris. I am now on Slide twenty. 'twenty two, yes.

I told you about the ambition I have for the company Group PDP and the role I want our company to place and the model of decarbonization for our sectors. [indiscernible] To achieve this, we need to invest. Investing is what is going to mobilize us EDP and the whole airport committee. Together, with Justine, we are going to work to strengthen the links between internal and external players and involve them in a collective project. This is why I am launching without delay the preparatory works of a new economic regulation agreement and I intend to submit a first proposal ready for a public consultation before then In term of investment plan, the multiyear contract will be based on the [indiscernible] that we have already taken place at early with Justine and the one that we will soon launch for CDG Airport. It will also be the instrument of a broader mobilization, including the first [indiscernible] Within this framework, group EDP will be able to leverage its organic growth. And financial discipline to ensure the balance allocation of its capital, including an unchanged dividend payout policy, presenting 60% of net income. We confirm our financial target for 2025 the outlook for twenty twenty three six as a year leading up to launch of an economic regulation agreement envisage for 2024 will be determined as part of our preparation for the public consultation.

With that, let's open the line for Q and A. Thank you.

Thank you.

Ladies and gentlemen, if you would like limit yourself Thank you. We will now take our first question from Christian Nadelcu of UBS. Your line is open. Please go ahead.

Hi. Thank you very much for taking my question. And Philippe and team, congratulations for the appointment. Well deserved The first one, if I may, on free cash flow $20.25, If I start from your Slide 19, if I look at the organic free cash flow generation in 2024, and then take into account your EBITDA guidance, your CapEx guidance and the higher higher cash tax. It looks to me that the free cash flow in 2025 may be slightly negative or flat. Would you agree with this? Or am I miss any important cash movements for free cash flow 2025? And my last question is a bit around CapEx and free cash flow mid term. You have flagged that your spending less CapEx in 2025 than initially thought. And you've mentioned, Philippe, in your written remarks and today on the call several times about the intentions to increase investment in infrastructure. So I guess in this context, could you give us a bit of of a roadmap of the CapEx trajectory over the next few years and what what does it really mean for free cash flow generation midterm? Thank you.

Thank you. Thank you very much. Perhaps for the first question, Antoine, Yes. Thank you, Philippe. Thank you for your question regarding the free flow generation in 2025. So indeed, in 2024, our free cash flow generation has been impacted by notably the tax situation with infra tax. But also as you have seen by the acquisitions, we have made combined with, of course, normal CapEx at our platforms. In 2025, you have the CapEx guidance. On the tax front, the impact of the infras tax will continue. You also have to have in mind, of course, the surplus of income of corporate income tax that will also impact twenty twenty twenty twenty five cash.

But on the other hand, we also have generation of cash in 2025 linked to of course, the increase in traffic and the increase of the tariff with the tariff that has been approved by the regulator from April 1. So with all that in mind, free cash flow generation in 2025 should be in a similar range compared to 2024.

Thank you, Antoine. For the CapEx level, I'm just Yes. Regarding our midterm CapEx magnitude, it's a bit too early to discuss an investment figure as the investment plan has not yet been finalized and we are still working on it. And the global vision we presented in the consultation for early and soon for CDG is not a detailed investment plan and includes no precise scheduling of works. So we will have several option on how to deploy this work, which still have to be decided. And we will have several environmental authorizations to obtain. Which can significantly change the schedule of work. And we have to take feedbacks of the consultations both in early and in CDG into account in this investment plan. So as we speak, we are not totally sure that we will do the investments envisaged under this vision, and we will update the market about long term investment plans in Paris in due course.

Thank you. Another question, please.

Thank you. We will now move on to our next question from Erik Limouree of CIC. Line is open. Please go ahead.

Yes. Good morning. Thanks for taking my question.

I got two. The first one on the surplus tax to be paid in 2025. Do you believe that ADP will be in a position to partially offset this surplus tax in 2026, who had shown tariff increase? And the second question on the on the international assets. So you mentioned in your presentation, I would like to know if I don't know, maybe what kind of return actually do you expect from this Indian and Turkish investment?

And in terms of dividends, when do you expect the first dividends to be paid from these two I would say, [indiscernible] So thank you for these two questions. The first question about the tax. So you know, we have a tax implemented last year for the infrastructure tax for aviation and airport So in this tax, we have a regulated part of the tax and the non regulated part. In the regulated part, we increased two years The level of Aéroports charges to offset and we now finalize this compensation. It's not possible to compensate the part non regulated part of the tax. So for the last year, in the infrastructure tax, we finalized our [indiscernible] to offset the tax. Just only one part of the third of the tax it's not possible to compensate. So second question about dividend and GEMR dividend from GMA and from TV. Clearly, We wait next few years.

Perhaps quickly. And we want to accelerate in this manner to have dividend from TV. And from GMR, as you know, we disclosed our targets, that is we can have dividend before the end of the decal, and we confirm that. Thank you for this both question.

Just one follow-up on the first one, actually, I was talking about not the infrastructure stacks, but more the exceptional income tax surplus. That you will pay in 2025 on your net profit before tax? It's not possible to compensate this income tax. It's not in it's not possible to compensate. It's a a one off effect, but it's a huge effect, but with a huge impact due to the in the net result, but it's not possible to compensate globally. It's not in the global economic balance of the regulated scope. In fact, we have a part of income tax in the in the calculation of the WACC and the ROCE, but it's not a huge without a huge effect in this manner. So not possible to compensate.

Okay. That's clear. Thank you very much.

Thank you. Another question please.

Thank Yes. We'll now move on to our next question from Luis Piuteau of Kepler line is open. Please go ahead.

Good morning. Louis Streeter here. Thanks a lot for taking my questions.

I have two, if I may. The first one is is the following. In the context of the reiteration of your international ambitions a moment ago, Where are the opportunities in the current context of tight brownfield valuations due to the significant amounts of liquidity in the infrastructure world. Where do you look at how do you fight against people with a lower liquidity and much lower IRR requirements? And my second question is more of a detailed question. Regarding working capital, my number are correct, I've seen a degree of erosion in the second half of the year. Versus the improvement in the second half of last year of 2023, sorry. Is there anything meaningful behind that that we need to know?

So thank you for your question. So about the first question and the M and A policy. In fact, we try to implement policies. It's a permanent policy to have a selective approach. It's a It's in line with the last year, but we are very selective in this manner. We want to secure the contribution so to secure the dividend of TIV and GMR. So it's a development is compatible with this policy, obviously, we continue to develop the group. If we have a relative and favorable impact through the international development. If we have to expect an impact in this trajectory, in fact, we will be very cautious in this manner. [indiscernible] For the second question? So your second question is regarding Viasat in the working capital between H1 and H2, correct? I think the variation is relatively minimal. I don't think there is anything major. But can you maybe please detail your questions? I'm not sure I have captured you were trying to address I was wondering if there's any real what I see here, if I look at the sorry, second half of the year, there was a deterioration of €86,000,000 in H1 of 2024. And that deterioration increases in full year to 139.

And the trend was the opposite last year. There was a deterioration of 106 in 2023. And then the second half of twenty twenty three, there was an improvement that led to more contained working capital deterioration. So there was a very sort of a very different behavior in each of this, sorry, 2423. I just wanted to know if there's anything Meaningful behind it, which is negligible. Usual behavior.

Thank you for this question. We will come back with details and we can have a specific call for that just to understand clearly what we want to to have [indiscernible] You.

Thank you. And we will now move on to our next question from Marcin Ojo of Bank of America.

Thank you so much.

Got a couple of questions. Ambition to have an economic regulation agreement What is a reasonable timeframe? Would you be Would you be satisfied if you can negotiate it within one year, two years or could it take even longer? And also, with regards to the economic regulation agreement, is it a negotiation mostly with the French regulator ARS Or there is an important role also for the government to play in this discussion? Are there any other important stake So thank you for this question about the key project that is a new economic regulation agreement that we want to do. It's to have a formal proposal at the end of this year And after that, we have a process, a formal process with all the stakeholders, specifically and the shareholders specifically for stakeholders for all the airlines that first of all, you have to to give some element and the specific consultation for that. We have also to have a formal process with the French state included the French regulator. At the end of the day, it's an agreement between the airport EDP, and the French state. But to sign we need a formal approval of the French regulator.

So globally, this negotiation it's for one year. So we don't expect a specific signature and the agreement before the beginning of twenty twenty seven. So globally, what we want to do is to we want have a large consultation with all the stakeholders including the local authority, included the parliament, included the unions and all our clients passenger but also airlines. And with this large global and common industrial project. And after when we stabilize this international project, and with industrial project, excuse me, we have to negotiate the economic balance. But if we have a good a good move in the international in industrial project, we can reach and have a global agreement.

Thank you. And I'll take our next question from Graham Hunt of Jefferies.

Yes. Thanks very much for the questions and congratulations on the appointment.

Just two from me. Firstly, can I come back to the 2025 CapEx guidance? I mean, you've consistently undershot what you've guided to on CapEx in the last two years. Just trying to understand this up to €1,400,000,000 Is there something that's different about 2025 that means you can now step up the CapEx spend and we should see that meaningful move up or is this a conservative level that you're setting again?

And then second question on just your priority to deliver contribution from the international assets Could you speak to what you can tangibly do to accelerate the timelines there? Or is it just a case of waiting for them to pay dividends, which I can't believe is true, but trying to understand that's a priority for you How are you what are the steps that you can take to realize those financial contributions from your international assets? Thank you.

So first question about CapEx.

Yes. So your question, if I understand correctly, is regarding how conservative our 2025 CapEx guidance is. If you look at 2024, you have bear in mind that there is two elements to it. There is ADP in Paris on one side and there is the group. We have for the for ADP in 2024, delivered quite well our CapEx program. As you know, we are in a curve of increase on an annual basis of our CapEx needs with a recovery post COVID and the launch of a new cycle of CapEx. Year on year, we increased to compared to the expectation. And that's for Paris, and that will also be the focus for 2025 with a strong mobilization of everyone to deliver the amount And on the group aspect, there is notably for TAV, a large part of the CapEx which was done, which is now behind us, The key CapEx triggers, which were Almaty new terminal, as well as Antalya new terminal are now behind us. So it gives also a better confidence in our ability to deliver the CapEx amount the international front. Just to summarize, before we have a guidance on average for three years, have now a guidance for one year.

And due to the performance in 2023 and 2024, we give you some clarification for 2025, but we are in our industrial strategy, no change. Clearly. In terms of dividend, and TV and JEMAR, globally for us, we have in our business plan clearly a good contribution for TV and Gemma. It's the reason why we developed the group. In the industrial activities just to have a strong contribution. What we say, it's that we for TV, but also GMR, we have to manage and to find a good balance between CapEx program [indiscernible] with deleveraging at the end of the day, [indiscernible] So clearly, target is to continue to deleverage Gemma and to finalize to deleverage [indiscernible] And after that, we have some project, huge project in term of CapEx with TV, but we have to finalize. We delivered, we commissioned in the infrastructure in '20 we have to commission the infrastructure in Orkara, in Antalya in 2025. After that, with deleveraging TV with the finalization of works in TV, we can have dividend. [indiscernible] part of international development and acquisition. If it's manageable, For GMR, we want to continue to deliver and to deliver the infrastructure in Delhi and in Dehradabad.

We have a strong growth in term of traffic in Delhi, but we need some CapEx. And to continue to accompany the strategy of Air India, the strategy of Indigo that is very, very important for the group and for Gemma. And we have [indiscernible] to continue to deleverage. That is a key element for us for the EDP shareholder in Gemma. But also with all this balance, it's possible to have dividends before the end of the decade and continue if it's possible. The development through Gemma. So and for EDP Motor Company, clearly, in my three pillars, we have a specific pillar in terms of ex time, ex time strategy, with the expansion in Paris, but also in the international. But it's not a huge amount in term of investment, but it's a very [indiscernible] So if you have a very relative investment in international development of full ex time and if we can continue to develop the group for TAVA and JMR, we can continue the story. But at the same moment, we can assume the robustness of the financial trajectory of the group. Speak about the the international development. So thank you for that. Have another question.

Yes, we do. We will now move on to of BNP Paribas. Please go ahead.

Hello. Good morning.

Philippe, one question for you. I would assume that you will continue on the path of your predecessor. In terms of overall strategy for the business. Compared to Mr. Zhoum Manet, where do you think you will be most different if any. And second question on the spend with passenger. Could you give us a bit more details for the works in 2025 to assess the impact. And then essentially look ahead to 2026 at the normalized level for Spenti passengers Thank you.

So thank you for your two questions. The first question about the strategy of Auguste Anne Romani and the continuity of of this strategy. That is key for to understand. The fact that we have some cycle in our airport industry. I am very, very comfortable with the strategy of Augustein Romani. So great. Strategy. We continue to improve the quality of service in Paris. We developed a group for international activities that is vital for the global balance of the group. And we create and develop the X Times strategy for the retail. We have also pillar and very comfortable pillar in terms of real estate, but also in terms of IT. So we are very comfortable with this strategy. But remember that [indiscernible] we have a strong hold in terms of aeronautical activities. [indiscernible] [indiscernible] we've an increase in term of traffic for around 22.5% each year. So a global and a growth strategy. After we have the strong impact due to the COVID, and the recovery. Of the COVID. This recovery is finalized probably last year. Not in 2025, but in 2026. After that, we have to find a new model It's not a new strategy. We have to adapt our strategy to this new context, that is a decarbonization that is the capacity to develop Paris due to the all the demand of our main clients, specifically Air France, And we have also to accelerate in terms of maintenance We in our CapEx plan, we have a huge amount in term of maintenance because we have a huge impact in Paris only, but also in Paris CDG with the fact that [indiscernible] We have all terminals and we have to refurbish.

So globally, My job, it's not to change the strategy. I am very comfortable with the strategy because because before with Auguste and Romain, I was CFO and the Head of Strategy. So no issue with that. But an adaptation for the new cycle and the new context. Thank you for the second question.

On spend per tax, so the headwinds of 2025, you have three main headwinds to keep in mind. The first one is Terminal 2 AC, which reopened in the second half of 2024. And so that will have a full year impact in 2025. You will see that in the first semester. Second main headwind, it's work in Terminal 2E Olk. These works have started already in twenty twenty four, but they will intense [indiscernible] the core of these works. These works With these works, we are not fully closing the shops, but we are relocating some of them to smaller areas. And so that has a dilutive impact and we are now at the core of this works. And the third headwind is the impact of Olympics which was positive on certain segments in 2024, notably on advertising. Also in essential travel retail. And so that is, of course, something that you will not see again in 2025. But all these headwinds, we are very confident that we'll be able to offset offset it. We see continued growth in luxury and retail. Of course, contrasting depending on the brands, but overall, very positive. And hence, we are quite confident with the new updated guidance that we have given to you.

Which is 4% to 6% growth of ASPP compared to 2023. Thank you, Antoine.

We have another question, please.

We'll now take our next question from Nicola Morea of Morgan Stanley. Please go ahead. [indiscernible] Just coming back on the CapEx, but trying to look at the big picture, I mean, the CapEx comes with needs to come with decent returns. So you talk a lot about more CapEx, but you're not talking a lot about what's coming on the other side. Have you had any in from the regulator that you're finally going to be paid fairly?

For the CapEx? I mean, we've seen again in 2024, you're at 4% return. On the regulated regulated framework. I mean your WACC is most likely above 5%. So any progress there?

And let's be honest, if you put your CapEx into perspective, as we said you've been undershooting quite a lot for the past few years.

CapEx is always delayed.

We're struggling a little bit to buy into the very, very steep CapEx rise that you're promising us. Can you you shed a bit of light on where you need to invest considering your maintenance level? Your maintenance spending is already 2x to 3x higher relative versus guys like Frankfurt or six to eight times higher than So we're can you shed a bit of that where you need to put all that CapEx into the infrastructure?

So thank you, Hamed, for your question. So first of all, in fact, if we have to accelerate, for a new industrial plant, we probably need some more CapEx That is key for us. It's to have a good remuneration through this CapEx. It's a huge part. It's a related CapEx. So we have to obtain a good economic regulation agreement. In this good regulation agreement, mechanically, we have to increase the [indiscernible] The question is the level of this increase and the capacity to reach and to have very good remediation through the regulated work. That is key Yes.

Regarding the composition of this amount of CapEx, in the upcoming years, we are facing a lot of mandatory CapEx, maintenance and heavy maintenance. As well as regulatory CapEx such as security or safety and other usual investments. So the aging of our platforms is the main reason why we have to invest more in the upcoming years And for example, Terminal 2F, which is part of the Air France Hub, was commissioned in 1998 And so it will be subject to major maintenance work by 2028. And we are seeing an overall leverage of €600,000,000 per year for a mandatory CapEx, but with higher numbers in 2026, twenty twenty seven twenty twenty eight due to this aging effect I mentioned. And this aging effect is both affecting CDG and Early. So we are facing a huge need of CapEx for the upcoming years.

Yes. If I may come back to this, so there's EUR 600,000,000 mandatory CapEx, but your bill I mean, your bill at [indiscernible] is what guided to be €1,000,000,000 next year. You're not really doing any expansion work. Should be enough.

So for the moment, we need some time to give you some color about the industrial plan. It's a global balance. We can manage and try to to have a good scheme in terms of CapEx increase. We have also to assume the capacity to [indiscernible] realize the investment. That is very important to to have in mind. It's the fact that we stopped the construction of the new Terminal 4. And for that, we want to develop our platform in another manner. [indiscernible] And for that, we have a specific strategy. What we have to disclose in details and to to have a huge consultation with all our stakeholders. The first strategy is to try to optimize the current infrastructure to welcome more passenger without a huge level of CapEx. Just adaptation, but not a huge level of CapEx. The second element After that, after the optimization, it's to strive to just to expand the current terminal. With a specific building that we can have, for example, between the railway station [indiscernible] [indiscernible] Through the at our modality, we can increase the number of passenger with high quality in term of service. And a good contribution for the passenger through our retail shops.

For that, we need some CapEx, but it's not a huge change. The third step, it's more important because we have to develop a new infrastructure. That we won't try to do, and we have to clarify this strategy before to give you some figures, it's to have new satellites just [indiscernible] new satellites [indiscernible] To expand the current building in Arlie to have more to increase the contract rate. But all for quality of service, but also to welcome international traffic, that is a more dynamic traffic. With this new satellite, difficult to operate just a new satellite. So we have to try to have a global vision of the airport. And for that, we have to develop the people mover between all the satellite The satellite, it's it's manageable. We can build for 7,000,000 or 10,000,000 passenger capacity without a huge, huge amount. [indiscernible] when you try to develop the people mover, we need some huge CapEx. It's a highway with highway station also.

So for that, we have to manage the time that we have to develop as a step to develop this [indiscernible] And so give you some time and we come back with a global vision for the consultation of CDG, but without figures, as Justin said, And at the end of the day, the global vision of course, our new proposal for the economic Thank you, Nicolas.

Thank you. And we'll now move on to our next question from Augustin Sehnwer of FIFTHEL Please go ahead.

I've got two, if I may.

The first one is on your traffic guidance for Paris in 2025. You guide for 2.5% to 4% increase is unchanged versus the previous guidance. But was just looking at the ATC system implementation impact of €1,000,000 in 2024. And when we adjust for it, it looks like you expect a growth of 1.5% to 3% in 2025, which to me looks like a return to normal. And would in my view maybe not account for any rebound for Asia Pacific. So my question is, are you assuming a return to normal of traffic growth And if not, how do you see this bring back being broken down, sorry, by geography? Do you assume any further improvements from Asia Pacific? Any further recovery also from LatAm and Middle East? Or how do you see it balanced by region? And my second question is on the evolution of your operational expenses. Could you give us a scale of increase in wages, external contracts and specifically energy for 2025?

Thank you. Antoine, for the first question.

Regarding the first question on our traffic guidance, we are, in a nutshell, still very confident with the guidance that we provided on the impact of four flights that you mentioned, you have to keep in mind that there is still an impact also in 2025 in January figures that we have published recently. And so if neutralize actually both the impact of 24 flights and 25 implementation of for flight. The underlying growth of traffic is around 3%. So that gives you a range which is indeed in line with our guidance. And so just to give you some color, we think that it will continue to develop in a similar manner over the next month. In terms of geographies, that's the second part of first question. It's difficult to call it a return to normal because the reality is that the traffic mix has changed completely compared to pre COVID situation. And so there will not be any return to normal, meaning a return to 2019 situation when it comes to domestic traffic. Which is a structurally declining. On the other hand, we do believe that the international traffic evolution, very positive that we have seen in the last few years, will continue.

And we see an America, Africa and of course, Asia also in increasing in 2025 with the specific aspect of China that we have mentioned during the presentation because of the caps in terms of number of flight schedule, We do not expect China China traffic level to grow in 2025. But we are still hopeful that at some point this gap will be raised and that traffic will increase maybe in 06/27? Regarding the second question on cost and energy cost, I continue. Yes. So So when it comes to overall OpEx, keep in mind that there are two aspects to it. ADB and the international aspects. So I guess your question was on ADP side. So on ADP, SA Paris platform, The staff cost has increased in 2024 by €14,000,000 with a mix of new recruitments made around two hundred FT feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet wages increase the beginning of the year.

In twenty twenty five, you will see also both effects with recruitments continuing because we are in this new phase that Philippe and Justin have mentioned. We do need to recruit still some people in certain segments of our activities. So these requirements will continue. And we have also announced very recent [indiscernible] wage increase, so that will also wait on the staff cost in '25 Regarding energy, we have secured almost entirely our energy for 2025, both a through the national scheme of RN and also by hedging with suppliers for the rest of the of our energy needs. And so that we have secured with a lesser cost than €24,000,000 And so we should see a slight decrease Thank you. Thank you, Antoine.

Another question? We'll now take our last question from Jose Manuel Arroyas of Santander. Jose, please check your audio if it's on mute please.

Yes, Ed. Good morning. Congratulations, Philippe. I'm Justine on the appointments. I wanted to ask you a few questions about the the plans to expand the international footprint. The first question is, are you talking about investments directly by ADP or will the investments be channeled through TAB and or GMR? And the second unrelated question, I wanted to ask you if you could confirm ADP's interest in the Egyptian privatizations? And if that is the case, why would ABB invest directly in Egypt and not DAB? And lastly, I wanted to ask you if you are looking at listed companies or non listed companies? That would be my three questions. Thank you.

So thank you for your question. So our first priority is to invest for TAV and Gemma. Not directly through TAV, except for ex time strategy. Is very important for us to develop around the world, but also in pies. That is the first point. The second point, in fact, if you have a very good opportunity or strategic opportunity that we can finalize globally our footprint through EDP. We study this element and we can have if it's not without a strong impact in our financial strategy, if it's not an issue. For a specific question about further development, we don't for the moment have to to disclose anything. And to have a specific position for any specific project. Thank you.

All right. I think it would be now time to close this presentation if we have no more question. So thank you everybody to have logged on to our presentation to our conference. So the next quarterly publication will be on the April 24, And by then, we will be looking forward to meet you We will attend some conferences and do some roadshows. And of course, we are with Elliott at your disposal to answer your question, if you have any. So feel free to reach out. Thank you very much, everybody, and enjoy the rest of your day. Thank you. Bye.

Thank you. Thank you. Bye bye.

Thank you,