Half Year 2026 Zabka Group SA Earnings Call Transcript
Key Points
- Zabka Group (FRA:9M1) delivered strong Q2 2026 results with sales to end customers up 13.2% year-on-year and like-for-like growth improving to 4%.
- Adjusted EBITDA exceeded 1.2 billion Polish zloty, up 16.2% year-on-year, with the margin expanding by 34 basis points to 13.3%.
- The company generated robust free cash flow of over 1.2 billion Polish zloty, with a conversion rate above 130%.
- Zabka Group (FRA:9M1) significantly strengthened its balance sheet, reducing net debt to adjusted EBITDA to 0.7 times, down from 1.2 times a year ago.
- The transformative all-cash acquisition offer from Kushtar at 32 Polish zloty per share, valuing the company at approximately $8.6 billion, is a strong recognition of the business's value and growth potential.
- The partnership with Kushtar is expected to create a leading pan-European convenience platform, providing access to enhanced scale, capabilities, and growth opportunities.
- Zabka Group (FRA:9M1) continues to expand rapidly, with over 13,000 stores and a target of adding more than 1,300 new stores annually, including strong growth in Romania.
- The company reported a year-on-year decrease in franchisee margin for the second quarter, which could indicate potential strain in franchisee relationships.
- Zabka Group (FRA:9M1) faces uncertainty regarding the outcome of the tender offer, as it is unclear whether minority shareholders will accept the 32 Polish zloty per share price.
- The acquisition by Kushtar introduces potential integration risks, including the challenge of preserving Zabka's unique culture and operational independence.
- The company's international expansion is currently concentrated in Romania, which is still in a ramp-up phase and generating losses, limiting near-term diversification benefits.
- Management declined to provide specific guidance on July trading or upgrade full-year outlook despite strong first-half performance, citing weather-related variability in like-for-like sales.
- The future capital allocation and financial leverage strategy post-acquisition remain unclear, as management stated it is too early to provide details on board changes or leverage plans.
Good afternoon and welcome to the Kushta and Jabka creating the next generation convenience retail platform. After the speaker's remarks, there'll be a question-and-answer session. This webcast will be recorded and an archive of the webcast will be posted on the company website. By participating in the Zoom call, you are agreeing that recordings made during the event may be shared by Jabka Group. For those of you who are joining us via Zoom, if you wish to ask a question during this time. We ask that you please use the raised hand function at the bottom of your Zoom screen, or if you've dialled in, please press star nine. If you already have a question, please do this now. Once it's your turn, the moderator will introduce you. Please then unmute yourself and ask your question. I'd now like to hand the call over to Filip Paschke.
Thank you. Hello everyone and welcome. My name is Filip Paschke. I'm the director of Jopka Group responsible for corporate development and capital
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