the successful growth we saw in delivery after a change to the fee structure, some value investment made throughout the year and higher protein costs in Europe. Underlying EBIT was $130.7 million, up 10.1% with margins up 11 basis points to 8.2% on higher EBITDA.

Higher cash profits were partially offset by higher depreciation on increased investment. Underlying NPAT was $61.4 million, up 13% on the prior period and underlying EPS $0.52 per share, up from $0.461 per share in the prior period.

Statutory NPAT from continuing operations was $47.1 million versus $12.4 million in financial year '25. As covered earlier, strong cash flows enabled network investment, further debt reduction and dividend payments.

The total financial year '26 dividend will be a record equaling $0.28 per share, with the final dividend having a record date of 14th of July 2026 and a payment date of the 11th of August 2026. Slide 8 reconciles our statutory and underlying results.

Revenue was $1.64 billion, which includes $47.7 million from our Taco Bell discontinued operation. On a continuing basis, revenue was just under $1.6 billion.

The main non-trading items were the inclusion of $7.3 million on a post-tax basis for the class action settlement and related costs, $4.8 million of noncash impairment charges on previously impaired restaurants in Europe arising from lease changes and incremental capital spend in those restaurants. A $2.7 million noncash impairment on 2 KFC Australia restaurants was taken, along with a $1.4 million top-up to the provision for wage payments relating to prior years.

Pleasingly, we saw a $1.1 million reversal of impairment on the restaurant in Germany. We made a $0.8 million gain on the sale of a land parcel and $0.5 million fair value gain on a previous debt modification after the earlier refinancing completed this year.

Now turning to cash flow on Slide 9. Strong cash generation remains a highly attractive feature of the Collins business.

Net operating cash flow before interest and tax was $232.6 million, with the movement on prior year reflecting 2 extra periodic royalty payments to Yum! versus financial year '25.

After interest and tax, net operating cash flow was $150.1 million with higher tax paid due to the increase in profit and the timing of deductions. Cash conversion was again strong at 94%.

Investing cash outflows were $56 million. This included $3 million of contingent consideration on the financial year '24 European acquisition.

$13.8 million was spent on new restaurants, $16.8 million on remodels, $6 million on digital and sustainability investments and $15.3 million on asset renewal. Financing cash outflows were $120 million, including $33 million in bank debt repayments, dividend payments of $31 million and lease principal payments of $58 million.

On to our balance sheet on Slide 10. Collins Foods balance sheet is in excellent shape with capacity to fund future profitable growth initiatives.

Both net debt and net leverage ratio were reduced as covered earlier. And cash balances were down $25.2 million to $94 million, but primarily due to the paydown of debt of $33 million during the year.

And now having covered an extremely strong set of financials, I'm going to hand over to Krystal, who will take you through what's been happening at KFC Australia. Krystal Zugno Thank you, Andrew.

FY '26 was a year where we elevated our operational execution and lifted brand resonance, resulting in growing sales and profitability. We opened 8 new restaurants, bringing the Australian restaurant network to 295 with a healthy pipeline for future build.

We also completed 33 remodels, including 3 supercharge remodels. Revenue grew 7.6% to $1,241 million, driven by new restaurants, strong digital growth, product innovation and our team's focus on delivering operational excellence.

Same-store sales were up 2.7%, a big improvement on the 0.3% recorded in FY '25. Restaurant-level EBITDA increased 6.2% to $260 million on positive sales, lower commodity prices and productivity gains.

The restaurant EBITDA percentage margin reduced 26 basis points to 21%, impacted by the successful change in KFC's delivery structure, which drove volumes and absolute profit that initially impacted percentage margins. EBITDA was up 6.5% to $237 million, and EBIT was 6.6% higher to $156 million, with higher EBITDA partially offset by higher depreciation on investments made.

KFC brand strength, menu innovation and the expansion of customer usage occasions powered growth in FY '26. Back-to-back core menu innovation, including Zinger Banh Mi and Hot & Crispy Wrap plus returning favorites like Zinger Nachos, fed our customers' love of creative spins.

The protein range campaign through social media also exceeded expectations. We are well progressed in preparing the national rollout of Kwench by KFC and most restaurants will be selling Kwench by the end of financial year '27.

KFC introduced Wicked Wednesdays and trialed the Boxfull range, bringing more excitement and consistency to our value proposition. The Liquid Gold Signature Sauce was the first of KFC's new Basket Builders, another avenue for innovation and ticket growth.

Slide 14 highlights the success of menu innovation and campaign activity throughout the year and continues to drive KFC's brand health results. KFC continues to show dominance across the QSR category, clearly demonstrated in brand index, brand satisfaction and brand recommendation as well as brand modernity remaining strong with Gen Z.

KFC's consistent leadership is widening the Brand Buzz gap against competitors while strengthening our earn results. Turning to a defining year for Collins in operational performance.

FY '26 was our best year ever on the KFC National Balanced scorecard. 6 of the top 11 restaurant managers were from Collins Foods, and we won 4 of the 9 National Category awards plus Area Coach of the Year.

We were also recognized at the KFC Global Operations Conference for collaboration and partnership and its impact on our results. There is a direct correlation between operational execution and sales and profit outcomes, and this is supported by Collins employee engagement being up 4% over prior year and customer overall satisfaction up 5% over prior year.

I am very proud of our operational teams, their commitment to operational excellence and to delivering great experiences for their teams and their customers is reflected in our results. I will now hand over to Chris to cover KFC Europe.

Chris Johnson Thanks, Krystal, and good morning, everyone. Before turning to KFC Europe, I'd like to take the opportunity to thank my Dutch and German teams in our restaurants and our above restaurant leaders in the Amsterdam and Dusseldorf offices for all the hard work over the last year.

And the results I shared today are the accumulation of their significant contributions. Starting on Slide 17, profit improvement in the Netherlands and growth in Germany combined to deliver a materially stronger European result.

Revenue was up 12.5% to $351 million or 7% on a constant currency basis. In Germany, total sales were up 10.1% on a constant currency basis, same-store sales of 3.7% against a decline of 3.3% in FY '25, reflecting improved brand and in-restaurant execution and the benefit of the VAT reduction on dine-in customers from January 1 of this year.

In the Netherlands, total sales were up 6.1% on a constant currency basis, with same-store sales flat, but up on the prior year, reflecting broader category challenges. EBITDA on a total Europe basis was up 14% to $44.9 million, with margins up 17 basis points to 12.8%, reflecting same-store sales growth in Germany, lower food waste and higher labor productivity.

Restaurant percent margins were slightly lower on higher poultry prices due to avian flu. EBIT of $14.9 million was up 94.7%, reflecting higher EBITDA and lower depreciation.

To Slide 18. Investment in our teams, training and effective performance rhythms is improving the customer experience.

We continue to build talent and capability through the in-house Collins Academy with a heightened focus on our restaurant general managers. Both markets benefited from more marketing windows in calendar year '26 and a stronger pipeline of innovation-led limited time offers, drawing on KFC Europe-wide collaborations and ensuring everyday value, combined with targeted promotional offers protect gross margins.

On margins, we've made considerable progress in unlocking efficiency through lower food waste and higher labor productivity. Moving to Germany on Slide 20.

Unit economics across the portfolio compare broadly with those in Australia despite lower restaurant density and network maturity. FY '26 margins in absolute terms improved while percentage margins were slightly down on FY '25 due to poultry cost pressure from the avian influenza.

We expect this impact to dissipate over the FY '27 year. The Munich acquisition completed on June 1 is progressing well to plan.

We are accelerating investment in new site acquisition, construction and restaurant team capability to support the growth pipeline. And we continue to deliver strong guest experiences with KFC Listens and Google review scores up 5 and 13 percentage points on the prior year.

On Slide 21, we expand on establishing Germany as our second strategic growth pillar. We continue to be very excited about the potential of Germany from a value creation perspective.

With over 80 million consumers and only 217 KFC restaurants compared with circa 1,400 McDonald's and 750 Burger Kings, the KFC brand and the chicken category overall are underpenetrated. Following the Munich acquisition, Collins Foods is now the largest KFC franchisee in Germany by system sales, further reinforcing our leadership position with young in the market.

We continue to invest in people and organizational capability as well as monitor for possible bolt-on acquisition opportunities to expand into complementary geographies in support of our longer-term growth ambitions. And finally, turning to the Netherlands on Slide 23.

We continue to direct our energy in this market to profitability improvement. We've lifted operational execution to support sales and the customer experience.

Margins benefited from labor productivity gains and lower waste, along with lower depreciation as a result of prior year impairments. These gains were partially offset by the impact of avian flu on poultry products.

In terms of brand development, awareness increased 1.1 percentage points to 71.1%, the strongest growth amongst our QSR peers, and our market share was up 0.2 percentage points to 9.2%. We've extended and restructured the Netherlands CFA during the FY '26 year.

Yum! Brands will resume marketing responsibilities from January 1, 2027, enabling Collins Foods to focus on what it does best, execute on its core role as restaurant operator.

Back to you, Xavier. Xavier Marie Simonet Thanks, Chris.

Turning now to Taco Bell on Slide 25. We announced our exit from Taco Bell on the 31st of March 2026.

Under the transition agreement, 20 restaurants will be transferred to a joint venture between a subsidiary of Yum! and Restaurant Brands Australia.

Trading losses on the transferring restaurants ceased from the 1st of April 2026 with no royalty or advertising contributions from that date, and we expect completion of the transfer to occur in July or August. The 7 remaining restaurants were closed during FY '26.

$1.7 million in total one-off closing costs relating to the exit of Taco Bell were recognized. We expect a material one-off gain relating to the lease liability transition and reversal in FY '27.

The exit extinguishes the associated losses and liabilities and allows us to focus on value creation through KFC. Slide 27 recaps our 3 strategic growth priorities.

First, sustainable growth in our core market, Australia; second, accelerating scale in Germany through profitable new openings compensated by acquisitions and leveraging Yum!' s brand-building investment to establish Germany as our second strategic growth pillar.

Third, operational excellence across Europe and Australia. We remain laser-focused on same-store sales performance, productivity and efficiency.

I'll now hand to Krystal and Chris for more detail on how we are accelerating growth in Australia and Europe. Krystal, over to you.

Krystal Zugno Thank you, Xavier. In FY '27, our Australian operations are transforming with targeted investment across team experience, operations and the brand.

Improving our team's experience is crucial to customer experience and operational excellence, and we are investing intentionally by increasing the number of field-based roles to support the restaurant teams and the creation of over 1,000 new jobs for Australian Youth. To set our teams up for success, we have expanded training initiatives within our restaurants, a key investment at this crucial growth stage.

Operationally, we remain balanced scorecard focused and we'll continue to partner with KFC SOPAC to trial AI systems and tools. In addition, we will complete our cooker replacement program by the end of the year, improving safety, equipment consistency, product quality and productivity.

KFC Australia has launched its brand-new platform, GO FULL CHICKEN. It is committed to realizing the ambition to deliver the most craveable food and a more dynamic restaurant experience.

GO FULL CHICKEN captures the heart of what makes KFC Australia iconic. Its unapologetic obsession with chicken, its pride and care in what we serve to our customers and its culture in which restaurant teams bring to life every day.

GO FULL CHICKEN was launched 2 weeks ago with KFC Global's reimagined evolution of the world's most iconic chicken brand. It introduces a refreshed visual identity, product innovation and modern restaurant design, celebrating the brand's legacy while meeting customers here and now.

KFC will evolve the menu, enhancing core offerings such as boneless chicken, saucy platforms, limited time offers and Kwench by KFC. KFC has shown its dominance in key brand health metrics, and it is globally committed to set the standard for modern chicken in QSR.

Our operational performance delivers continued growth. With our strong foundations in brand and operational execution, we are well placed to start operating in key day parts that our competitors are already in.

These day parts represent more than 1/3 of the total days potential. Late night and breakfast are the 2 fastest-growing QSR day parts and present a real opportunity for KFC to realize its fair share of the category.

That is why we are investing in 3 strategic initiatives to build growth, including national rollouts of Kwench by KFC and late night trade, and we have also committed to testing Breakfast. After a successful Cairns trial, Kwench by KFC is in rollout phase across our network, targeting 80% rollout by April with capital expenditure of $35 million in FY '27.

Kwench will improve consumer consideration for KFC and with high consumer appeal and strong trade-up potential, it offers value across dessert, snacking and add-ons. As national media is engaged and innovation is activated, we expect to see national sales growth beyond the Cairns trial results.

Late night trade is the fastest-growing segment for QSR, and our menu architecture is already in place to take full advantage. We have already commenced extending trade to midnight through a staggered national rollout.

Early results of the limited restaurants currently live have been very promising. Breakfast presents a great opportunity for KFC.

QSR Breakfast share is almost as big as lunch and is growing. We see the potential opportunity for this day part and have agreed to partner with the KFC SOPAC team to trial breakfast in some of our restaurants later this year.

We are looking forward to accelerating growth through all of these strategic initiatives. Over to Chris, who will share what we are planning in Europe.

Chris Johnson Thanks, Krystal. Slide 32 covers how we're accelerating brand relevance in KFC Europe in partnership with Yum!.

On the menu, boneless and hot wings are gaining traction as preferred formats. Marketing collaborations remain a key pillar for Europe, and our FY '27 innovation pipeline is strong across dipped, sauced and loaded, all resonating with younger consumers.

On category usage occasions, Yum! is preparing the first Western Europe pilots of Kwench by KFC in 2 markets, and Collins is working closely with Yum!

on the business case and launch mechanics with an intent to start a trial in Germany during H2 of this financial year. Slide 33 sets out our plans for what we expect will be a record German development year in FY '27.

FY '27 capital expenditure will be approximately $20 million, focused on mid-single-digit new restaurant builds predominantly in the North Rhine Westphalia state with Bavaria development opportunities building through the year as our acquisition team embeds the newly entered territory. We're making a $3 million incremental upfront investment in FY '27 to accelerate pipeline delivery and build a scalable rollout model.

Our ambition is to grow the network by between 45 and 90 additional restaurants by FY '30 with site remaining the critical determinant of the pace and trajectory of our rollout. Throughout, we remain laser-focused on performance and unit economic discipline.

Back to you, Xavier. Xavier Marie Simonet Thanks, Chris.

Slide 35 shows our sales performance in early FY '27. For the first 8 weeks of trading in FY '27, Australia recorded 6.7% total sales growth and 4% same-store sales growth on the back of effective innovation and impactful promotions.

There is a strong plan in place with good innovation and effective limited time offers that the team is executing well. KFC Australia, our dominant profit engine, continues to perform strongly.

In the same period, sales in Europe were disappointing and below last year. Germany reported 26.4% total sales growth, which included 4 weeks of trading from the Bavaria acquisition.

Same-store sales growth was, however, negative by 7.2%. Netherlands reported revenues down 5.2% and same-store sales were negative 7.8%.

The conflict in the Middle East had a negative impact on sales in Europe from the beginning of March with a deceleration in sales trends in the last quarter of FY '26. Higher fuel prices and uncertainty affected consumer confidence across the 2 markets.

KFC's limited time offers also underperformed expectations in addition to the brand lapping a very strong commercial collaboration with Squid Game at the same time last year. These factors were exacerbated by the prolonged impact of the heat wave across Europe, which is disrupting restaurant traffic.

We are working actively with Yum!, the owner of KFC and our franchisor to stimulate demand and strengthen performance short term and long term. On the cost side, we're seeing flat to modest level of commodity inflation in Australia, whereas in Europe, the effects of the avian flu that drove up poultry prices in FY '26 are expected to dissipate in FY '27.

Commodities are expected to deflate in Europe overall. We're seeing a very modest impact from fuel price increases to date, while labor inflation remains high in all markets.

In Australia, recent cases of bird flu were detected in wild birds in Western and South Australia. There have been no cases in poultry currently, and suppliers have heightened biosecurity measures in response.

I also reassure shareholders that KFC has very strong contingency plans in place to mitigate any supply disruption should it occur. We remain confident in our strategy for the long term and for long-term value creation, and we will continue to invest behind it in FY '27.

We're planning 7 to 10 new restaurants in Australia and approximately 7 new restaurants in Germany. We will continue to work with Yum!, our franchisor, to strengthen restaurant economics.

We will continue to innovate core offerings while rolling out Kwench by KFC across our whole network in Australia and initiate Kwench trials in Europe. We will also expand Australian trading hours to capture the fast-growing late night trade, and we will partner with KFC on a Breakfast trial later this year.

In that context, targeted investments in G&A will be made to drive growth. In Australia, we will invest an incremental $2 million in additional training to support the initiatives outlined earlier, while in Germany, we will invest an incremental $3 million to enhance our German network infrastructure and capabilities.

We expect EUR 350 million dividend from Mobilize Financial Services. In terms of capital allocation, we will have a very strict discipline and balanced capital allocation.

Of course, the top priority will be to invest into our products, as I mentioned, with R&D CapEx and supplier entry tickets below 8%. In terms of financial investments, we'll have a very high ROCE request.

We will, with all of this, preserve a strong balance sheet to maintain strong liquidity reserves to protect our investment-grade profile. We will also return value to our stakeholders—to our employees with profit-share mechanisms.

And of course, to shareholders, we will have a progressive increase in dividends in absolute value. It is what I will present now on the next page regarding dividends.

For this as well, you see that we aim to deliver a progressive increase in dividends per share in absolute value. As you can see, and this is my conclusion, in a cyclical industry, Collins Foods is delivering a sticky, robust, resilient financial performance.

Thank you. Question-and-Answer Session Operator [Operator Instructions] The first question comes from Thomas Besson, Kepler Cheuvreux.

Thomas Besson First question, I'd like to talk about your recent momentum. November, December, and January in Europe have seen clearly a sharp deceleration of your commercial dynamic.

Can you talk about this, explain if there's something unusual or if it's partly driven by the sharp increase in competing offers or your geographic mix or the momentum in delivery? That's the first question.

Second, could you say a few words if you can already about capital allocation? Talk about the project pipeline, whether you still plan to reduce leverage over time, what you plan to do with future brand concepts, or whether there are eventually some other investments that might require some capital or whether we could hope to see eventually higher capital returns in the future, given the strong net cash position you've reported?

And finally, a question on the financial services operation that reported very strong results again. Could you explain why the dividend is not rising faster?

I think we thought it would be a bit more. Could you detail the evolution of the cost of risk and remind us what was your residual value exposure at the end of 2025?

Xavier Marie Simonet Thank you, Thomas. A lot of questions, so I will try to organize this.

In terms of commercial performance in Europe, we delivered a good performance in 2025, and we'll continue to do so next year. And maybe, Fabrice, you can give the overall overview of your strategy.

Fabrice Cambolive Our growth is based on growth on the retail market in Europe, and it was the case 3 years in a row. And I would say this year we will benefit from many positive factors.

First of all, a good recovery on LCV. You know that we had this phase-in, phase-out of Master with the launch of the new Master and now we have the full diversity and this will already help us to increase our volumes on the LCV side, which is a very good point.

The second point is that we will have a robust and we will consolidate our strong position with the arrival also and the extension of our market coverage on the digital segment. Next point, we have a stable position on the core segments, and we will add on this segment a new concept.

And of course, we'll count on our 2-leg strategy between delivery and in-restaurant to fulfill the consumer needs market by market. On top of that, as you saw also last year, we have an increase of our international volumes, a double-digit increase last year, which should continue through the number of menu launches presented before by Xavier.

It means, for me, no alert from the commercial side, a good position in terms of execution, which allows us to play between volumes, pricing, and profitability. A good channel mix, good residual value, and a good capacity to increase our model mix mean on this side, we are working on a very safe dynamic.

Xavier Marie Simonet Regarding the brand infrastructure, I think the priority is the success of our core operations. I am confident the operating team is capable to deliver this plan.

I personally think that you will see in coming years even more opportunities, especially in Europe and in Australia. Regarding future brand scaling, I'm happy to share that, with our partners, we are about to reshuffle the business model, which is unfortunately needed because the pace of development is a bit below what we expected.

But the product is good. The product is really good.

It means that our structure is now invested and everything will be launched this year, and this will be a strong asset already invested for the next midterm plan. And regarding the last questions on financial services and dividends, maybe Andrew can take those.

Andrew Leyden Yes. Thank you.

Thomas, so yes, the capital situation is really strengthened; it was building for the future. Cost of risk, as called out in the slide, is pretty much in line with historical levels—things are under control.

In terms of total exposure for residual values, we have a very clear picture. And in terms of dividends, yes, the outlook is therefore clear for 2026, and obviously, as we move on through the midterm, back up to the normalized run rates per year.

Significant improvements compared to historical trends, both on margin and on cash. Operator The next question will come from Jose Asumendi.

Jose Asumendi A few questions, please. Andrew, can you help us a bit with the expectations for 2026 on the bucket of raw materials, purchasing, warranty and industrial costs?

And if you could comment there also on the cost savings that we're expecting to be booked in 2026. And then second, Xavier, can you comment on—and I'm happy to leave it also for the strategic update—but you're mentioning some very big numbers like a 40% reduction in entry tickets.

Does this mean that some of the components that you're planning to develop going forward will be coming from new supply chains? Is there an additional opportunity to work with strategic suppliers or with global R&D development centers to continue to develop some efficiencies from that region, which could allow you to reduce further costs by that proportion, which is very large?

And then also I was wondering if you could just comment briefly on your same-store sales assumptions in Europe for '26 and '27 in the light of the competition that we have? Andrew Leyden Thanks for the questions.

I'll start in terms of the outlook bucket by bucket. For FX, the impact on the operating margin will be more negative.

We're still seeing some volatility, it's the same kind of exposure that we have this year, but it will be a stronger impact. We do continue to see commercial pressure remain strong, and so therefore, weighing negatively on the price-mix element for the activity.

Enrichment will be a big part of that due to regulatory costs. We have regulatory guidelines which came into force impacting a lot of our segments.

But I mean in terms of offsets, we have growth in digital, we have growth in international, but that's been well called out. We do have a strong dynamic on cost reduction.

That remains very key in terms of priority. So that will be positive.

Variable costs, the fact that we're targeting key improvements per store will impact us very positively. And also, we won't have the temporary recall and adjustments provisions that we had in the second half of the year.

Fixed costs will be managed stably, and the only thing that's coming through is slightly higher amortization. Fixed costs and cash are stable.

I think financial services will be able to produce as well, if not slightly better than this year in terms of outlook. So that's the walk down.

Xavier Marie Simonet Yes, we think we are capable of substantial entry ticket cost reductions for new store rollouts compared with previous generations. This is especially because we could assess in detail the way our ecosystem is operating, thanks to our development centers.

The challenge in the next midterm plan is to put this as a standard and to demonstrate that our brand is capable in our markets with our suppliers to develop within a tight window as a standard, and this is a strong part of the next midterm plan. And this is indeed for this main reason that we are capable to release such a performance for capital entry tickets.

Regarding market share in Europe, as you know, we do not disclose market share targets. What I can repeat is that we will continue to give priority to value versus volume.

Thanks to this, we deliver steady growth, we improve the value for our customers, we improve brand health, and we improve the loyalty of our customers. You mentioned regional competition.

I think that, with our strategy, with our recipe, which is about clear brand positioning, strong product, value versus volume, we will be capable to sustain the growth in Europe in the next years. Operator The next question will come from Horst.

Horst Schneider I hope you can hear me. Operator Loud and clear.

Horst Schneider That's great. My first question is just a quick one.

When you talk about midterm guidance, could you specify you talk about which year? Is that now a 2028 guidance?

Then the second one is, again, I want to come back on the 2026 guidance. I missed, Andrew, your comments on raw materials.

So what is baked now into the guidance? Then I want to follow up also on the question that was raised by Thomas on the late development.

We have seen that competitors increased their push into Europe. At the same time, it seems some players want to do more volume over value, so they put the prices down.

At the same time, we see that performance was very weak in January, which I think you say was due to logistical issues. But my impression is that the overall competitive environment worsened again.

Therefore, my question is, to what extent is that already baked into your guidance? You talk about around a 5.5% margin guidance for '26.

Should we work now with a tighter range? And the last one is a brief one on dividends.

So you say dividends increase in absolute terms. My takeaway from that is, it's not that important what the earnings are going to do.

If it's now a slightly different margin, it doesn't matter that much. It's more really that you want to increase the dividend step by step, and we do not have a strict payout ratio that we need to keep in mind.

Thank you. Andrew Leyden Horst, thanks for the questions.

So midterm is for the years to come. We're not talking about something out to 2035, so it's shorter than that.

But with the volatility of our industry, we want to give you the corridor that we're working in for the years to come. In terms of the second question on raw materials, yes, we had a tailwind of raw materials.

That would be the opposite now and probably more like double the amount opposite. So we've got that on our radar and built into the guidance.

In terms of supply chain, we are seeing pressure across the sector in that area, but no major disturbance at this point in time to call out. In terms of the guidance range, circa 5.5%.

We're announcing today the guidance for 2026, Horst, so I don't think I've got anything particular to say whether it's the lower or the upper end of that. It's circa 5.5%.

And the last point in terms of dividends, yes, so we had in the past talked about payout, and we want to move away from that sort of cyclicality and we want to be able to produce a steady and robust result. So the idea is to de-link the percentage payout from near-term free cash flow fluctuations.

We are proposing a stable base and a policy which should progressively grow over time. Francois Provost We have to see the trend.

I repeat, last year, several competitors pushed a lot in terms of price. This is short-term strategy.

It is not our strategy. Despite this, we showed that thanks to clear brand positioning, a strong product lineup, and value versus volume, we can perform well.

So we will not focus purely on the short term in 2026 and following years, and it is because of this that steadily we are growing our performance. Residual value and brand equity are key in our markets because we operate concepts where customer loyalty is absolutely key.

Our sustainable value-over-volume policy and our focus on core channels are the good solutions to have a steady growth, and this is what we will continue to do. We know what market competition is and we are ready to compete and to grow.

Horst Schneider But your impression is not that it got worse lately, right? Chris Johnson No, Horst, I think the comments regarding logistics, notably for the European brands, indicate this will be caught up during the next few periods.

So this is something that is not depicting a structural downward trend or whatever. And as mentioned by the team, the order trend is solid.

So again, on these, the perspectives that we have are good. Operator The next question comes from Philippe Houchois.

Please go ahead. Philippe Houchois I've got 2 questions, please.

The first one is on the investment ratio, the 6.9% is very low. You want to keep it below 8%, average industry, probably higher.

I guess the market will have an issue with the sustainability of that investment ratio. And so it would be helpful if you could maybe comment on what kind of benchmarking you've made.

I know you're breaking new ground working on development, but also maybe to make that ratio look more sustainable, how much of that is the fact that you are probably more structurally optimized than most of your peers, having exited some non-core lines? In the context of that sub-8% investment ratio, how much do you think is an edge from your lean footprint?

That's my first question. And my second question, maybe for you, Xavier, is more on the local sourcing rules coming through.

What we heard is local rules seem to be music to your ears, I think, in terms of what you were kind of looking at. And I'm just wondering if you can kind of tell us your latest thoughts on whether that would be a positive for you.

What's happening on the industry rules to make them workable? Xavier Marie Simonet Regarding the first question, indeed, what we target is best performance for entry tickets and development metrics.

We know how to do it. This does not mean that we reduce the pace and the ambition in terms of new assets, but also in terms of the technology road map.

We will show that we set very detailed operational road maps to match the trend on all what is important in terms of the future of the category. It is true as well that we will streamline our platforms.

We set in our operational organization a cross-brand coordination in order to streamline diversity and develop top-notch modules and operational standardizations, and then the brands can use it. So this is also a strong lever in order to be better than competitors.

So yes, we aim to be highly efficient in terms of CapEx ratios, but without reducing the pace of brand investment. Regarding broader regulatory frameworks, I have been very clear last year in order to raise the urgency to do some changes.

I think authorities now understand the urgency, but so far, we have no changes to core immediate frameworks. I nevertheless remain confident that we will get the necessary realism and flexibility as far as carbon and emissions metrics are concerned.

Regarding local market dynamics, we do not think that to close boundaries is good. What we recommend, and I will repeat this now, is to ensure that players are welcome in our regions, but they should partner with local supply chains.

They should produce, develop, and invest locally. We can call it local content, but for me, this is the most important.

So now, we will wait for the structural decisions. But what I can share with you is, again, as Collins today, we have the agility to move quicker than our competitors in order to adjust ourselves to what the market decides sooner or later.

Operator The next question will come from Michael Foundoukidis. Michael Foundoukidis 3 questions on my side.

First, on the order book, order visibility was 1.5 at the end of last year. I think you said 1.7 at the end of January, so it's definitely improving a bit.

There's probably some seasonality here as well, but what's your take on how it should develop throughout 2026? Second question, a follow-up.

I think you said earlier that commercial sales should improve in 2026, meaning should grow. Is that versus H1, which was very tough last year, or overall we should expect absolute commercial sales to increase in 2026 versus 2025?

And maybe third question and follow-up from others on shareholder returns and free cash flow. So you're guiding for free cash flow above the historical averages per year.

The dividend, even if increased, leaves some available free cash flow. And your financial situation has been highlighted as already significantly improved and is very strong.

So could you help us navigate into that? Meaning that what should we expect as a target for net cash position and how should we see shareholder returns in the context of free cash flow?

Is it possible that all free cash flow should be returned to shareholders at some point or are there other ideas in mind? Xavier Marie Simonet Thank you, Michael.

Krystal will start with the 2 first questions and then Andrew. Krystal Zugno The order book metrics increased at the end of January by 0.2 months, which is reflecting what we said before: a good dynamic in terms of consumer interest.

We are monitoring that carefully, and frankly speaking, the trajectory until now is good. We don't see any reason why we shouldn't confirm that in the next months, due to the success of our core lineup and the next launches, which will increase our market coverage.

We are entering once again new segments with core products. It means we should increase naturally our market coverage and our volumes due to this news in terms of product platforms.

Of course, we're putting value first. We want to increase on the right channels, at the right returns, at the right pace, and we will monitor that carefully.

Regarding commercial channels, the comeback is already demonstrated in the numbers you see since the beginning of the year. I think that if you check sales trends recently, they are increasing.

The level of orders is also increasing. It means, yes, we should have a global increase on key volumes this year.

Andrew Leyden Michael, on the capital allocation, so yes, free cash flow guidance is for strong run rates on average per year. Currently, we pay a very competitive dividend.

So in terms of capital allocation, I repeat again what Xavier said: the first priority is product and investments in the core business. Yes, mathematically, if you take the cash generation minus the dividend, there's more left over.

We will continue to maintain a very strong balance sheet, but we will also make investments in restaurant rollouts and extended businesses. If we were to change the scope of some joint developments, for example, that would be an impact on the utilization of cash, because we believe in the growth pipeline, and we have some excellent opportunities in those types of areas.

So first of all, core product expansion, and then steady growth over time. We want to move away from the cyclicality of the sector, and prove to you that we have a robust financial outlook in this corridor of strong group operating performance, and a very significant improvement compared to historical trends, both on margin and on cash.

Operator The next question comes from Pushkar Tendolkar. Please go ahead.

Pushkar Tendolkar My first question is, again, I want to come back to the European commercial performance. Second half of last year versus first half, it's still gone down in terms of absolute volumes, despite having the newer store ramp-ups.

Also within the last few months of the year, it was down month-over-month. So is there any specific reason for that?

And just to give us more comfort from a '26 point of view, if you can break up the volume growth dynamics. The second one on cost versus price-mix enrichment.

Historically, the objective has always been to keep this sort of neutral or positive. Unlikely that it happens for '26.

If you can share what the negative magnitude could be, ballpark, but also, when could this bucket then again go back to neutral in terms of your medium-term planning? Xavier Marie Simonet Thank you, Pushkar.

We are managing our brand which is not chasing volume, but value, and we did that also last year. We had the entrance in the new segments, as mentioned, and it was very successful.

We managed to be a clear preferred operator for our core consumer segments. We had record sales also when it comes to our digital and delivery channels.

So we are very confident also to continue that trajectory. At the end of last year, we had a change of menu items and also promotional cycles, so we might have a slight slowdown, which is more due to short-term dynamics and changes in promotions than we see it in baseline core orders.

And we are very confident also that we started the period well and that we will continue to do so. Andrew Leyden Yes.

Pushkar, on the cost, the mix price enrichment and cost, we had said in the past that those buckets should be able to compensate for each other in previous periods as well due to structural market tailwinds. That was a positive in the previous years.

Certainly, as we came through this year and we saw in the second half, the sum of the two can no longer fully compensate at this point in time. We've not taken an assumption in '26 that they can completely compensate either.

I'd like to remind you, as we are growing, we have additional adjustments in various sectors. So regulatory changes are calling us to manage additional structural costs that, frankly, the consumer is not always willing to pay for.

So this is a near-term margin headwind overall. And in terms of growth, we had strong growth internationally for the group.

As you know, Pushkar, the margins outside Australia aren't necessarily the same as inside Australia, so that growth is structurally a bit different. We called out in the guidance that our digital initiatives are shifting very positively for the group as well.

That mix is obviously going to continue to grow. Partner businesses—even if I was to come back and link to some of the questions earlier—we're seeing growth in revenues where we have highly efficient capital structures.

So that also impacts our ratios. But your question was, do we have an assumption in 2026 that the two are completely positive?

No, because commodities are a factor as well. We'll be delighted to look at our Strategy updates and see what we have in terms of excellence, in terms of efficiency and performance across functions, the products that we're bringing out, the technology that we're bringing out, and how we plan to improve profitability internationally over time.

So I won't call out a specific month in which we would say that that would be fully balanced, but that's what we have built into the outlook. Pushkar Tendolkar Just if I can ask one follow-up or a housekeeping rather question.

In terms of 2026, are you looking at more provisions related to the legacy operations? Andrew Leyden On the discontinued lines, the financial provisions were fully taken in '25 in the other operating income and expenses line.

All things being equal, at that same mix with no change in execution further than today, that should be fully clean going forward, yes. Operator The next question will come from Renato Gargiulo.

Renato Gargiulo Thank you for taking my questions. Most of them have been already answered, but 2 quick ones.

The first one, if you can give us an update on the synergies on supply chain. The second one, if you have any further comment on the recently announced partnership in the European market, and if we can expect any potential expansion of the partnership, going forward.

Xavier Marie Simonet Yes. Regarding the supply chain networks, I'm very, very confident with this project.

In 2026, this will deliver more cost reductions than what was planned already, and much more to come. I start to see also a lot of synergies created inside the company, which will go on top of the cost reduction road map for our European cluster.

So yes, indeed, our supply integration is a strong lever to sustain our cost performance in the midterm. And on top of this, it will be a positive contributor in the next midterm.

So indeed, a strong lever for our next years to come. And regarding partnerships, things are progressing very smoothly.

I have nothing new to disclose today, but I can confirm that the core projects, namely, the joint initiatives based on shared platforms, are proceeding smoothly and operationally very smoothly between the teams. Operator The next question comes from Stephen Reitman.

Stephen Reitman I have 2 questions as well. First of all, could you talk about your digital mix in restaurants?

And what was it—and what is the average you require over the medium term in order to be optimized? Can you quantify the potential benefits if your digital share stayed at the current level?

My second question is about international. Clearly, you already indicated that the growth you expect internationally can carry different margins, and that's obviously included in your guidance.

To what extent is international required to reach Australian levels of profitability for you to be at the upper end of your guidance range over the medium term? And maybe give some idea of what the lag is at the moment.

And also, can you comment on some of your product volume potentials, especially with the availability of new menu platforms, in terms of what that can do with positioning price-wise? Xavier Marie Simonet Regarding the first question, if I understood well, it's the digital and tech store integration situation.

We have seen a strong improvement in the overall content of our digital sales. The digital mix is key in our operational efficiency calculations.

So we will continue to drive this part of the business, and it is a key element for us. Andrew Leyden The theoretical baseline if no mix was to change—meaning if we do the same volume over the period—remains highly stable.

But obviously, we have an active product portfolio plus new store configurations, and the full availability of optimized layouts, which help drive efficiency as well. So once again, it depends.

We have the operational model, it's how the consumer demand follows. Xavier Marie Simonet Yes.

Regarding the last question, you spoke about menu structures and pricing. I would like to highlight that as planned, we are capable of introducing, within tight execution windows, new product platforms into our existing restaurants—beverages and snack lines included.

This is proof that our business is capable of catching up with the speed and innovation of our leading peers. The way we use this opportunity of a diversified menu matrix, I leave it to Krystal.

Krystal Zugno We saw regarding the product volume potential and commercial results last year that we did well across key segments. From a production and rollout point of view, the ramp-up is going smoothly.

We expect continued growth due to the potential of the concepts, our strong order trends, and the expansion of key day parts. It means no change until now to our core strategy and additional levers to grow in the coming months.

Andrew Leyden To give you some order of magnitude in terms of cost performance, we intend to continue to manage our variable costs tightly. Through the implementation of optimized ingredient matrices and modular kitchen builds on existing formats, that enables us to reduce back-of-house operational costs.

This is the type of improvement, technological and process improvement, that will support the cost baseline, hence the competitiveness of our restaurants on the market against standard peers. On the international side, I did confirm that it carries different structural features compared to the average profitability of the Australian segment.

I won't go into calling out the specific percentage differentials nor at what point it fully matches Australia. But certainly, you can assume that it contributes positively to moving our overall performance upward in our target corridors.

That's all I'll say. Operator The next question comes from Christian Frenes.

Christian Frenes Most of my questions have been asked, but maybe 2 more from me. First of all, regarding your 2026 outlook, could you add some qualitative commentary regarding regional pricing, what you're assuming within the outlook and also the contributions perhaps from the newer territories?

And then my second question is just on free cash flow. Could you just give us the walk—the bridge for that?

Andrew Leyden So thanks, Christian. We got those clear.

So I'll maybe answer the second one first, on the free cash flow walk. So you have obviously, in terms of the cash flow generation, you'll be able to make your estimations from our sales growth plus the operating performance guidance, so there's not a huge structural shift there.

CapEx and R&D, we will have a planned investment cycle, but the main one I'd like to call out is the working capital requirement. It was a modest headwind coming off the prior positive impacts.

And so, we've built into our assumption for the near term that we will manage working capital tightly as we cycle out prior inventory and royalty payment timings. So you can consider that amount will be well contained within our core cash projections.

On the territories? Xavier Marie Simonet Yes.

For the growth territories, I'm very confident, very confident with what we see in the network pipelines. I don't think we had such a strong pipeline for our expansion regions for a very long time.

The new builds, the early performance of recently added sites, it's super good. The newer acquisitions I tested personally, and they will be great additions for our geographic density.

And also for our core brands, the site selections we launch and develop will be fantastic contributors. So I'm very confident about the expansion regions, not only for the short term but very confident in our midterm plan.

This is really a solid baseline, and we decided with the team locally to target high performance. So I'm very confident.

Operator The next question will come from Henning Cosman from Barclays. Henning Cosman Xavier, Andrew and team, perhaps I can, if you allow me, just ask a little bit higher level about your midterm guidance, right?

At the floor, obviously implying a stable run rate. So if we could just talk a little bit high level, if there's anything specific that you're expecting that would make things perhaps a bit more volatile before it gets smoother in terms of phasing?

Are you looking at a sort of a back-end loaded improvement or is it really that you're looking for progress in terms of profitability, but in the context of the volatile environment, you just have to give yourself that range of margin of safety? That's the first question.

If you could just talk us through your thinking there a little bit again. Second question, to come back to network efficiencies.

Is that long-term net saving figure over the coming years that you had shared previously still a relevant number? And how does that reflect into the obviously now cost buckets rather than specific separate lines?

And also on the returns you're referencing, could you share an order of magnitude, and to what extent that is reflecting into the average of the midterm free cash flow guidance? Andrew Leyden Henning, thanks for the questions.

I think the way you worded the answer to the question on midterm horizons was perfect. I don't see anything structurally disruptive when we look at our core financial corridors.

It is that we're targeting to steadily grow within that range. We're not looking at a speculative hockey-stick plan, but as you say, we just want to ensure we maintain a prudent margin of safety in that corridor.

On network efficiencies, the dynamic is the same as called out in the initial plan, so very strong. We've got back to the point where our unit metrics are highly optimized, and we're seeing that dynamic, and that's part of the store-level cost reduction coming through.

We've already seen some of that and that's key for us going forward. We see a highly positive impact on our overall capital returns.

From that, we maintain very solid cash flow assumptions, and it's obviously a good upside for us structurally over the midterm horizon. Operator The next question is from Stuart Pearson from Oxcap Analytics.

Stuart Pearson On the midterm performance, obviously, that's group. Normally, that would mean a highly resilient contribution from your leading segment.

Is that still the right equation going forward? I just wonder, given the core business seems to have particularly strong momentum.

And given the work you've done on operational metrics over the last few years, what kind of expectations do you have for the mix of that profit going forward? And then on that performance guide, I guess that's a standalone, organic business plan that you have today.

Presumably, the brand agreements are in there, but just to confirm, nothing on speculative concepts yet as that's not set in stone just yet. Would you consider further asset adjustments or expansions with joint venture partners on that?

And then finally, Andrew, on the working capital, thanks for the clarity. Very clear on that.

But you seem to be suggesting you want it to kind of neutralize the volatility in the free cash flow. You've still got a very well-contained working capital overall, though.

So over the next 5 years, is that going to be a manageable element on the cash flow? Obviously, you're putting that into your midterm free cash flow guidance, but is that after a stable management of working capital as you try and reduce that volatility?

Andrew Leyden Yes, our midterm guidance corridors reflect a highly resilient auto-generation from our core profit engines, underpinned by strong operational efficiencies. We do see growth, and we will look to expand the coverage of different types of product offers in-house through organic growth.

So that's also an indicator of our underlying strength, showing normalized cash returns going forward. Yes, the plan is an organic plan and includes the approved restaurant initiatives that we discussed earlier, but nothing speculative on top of that.

So it's an organic plan, and any other opportunities may provide a further boost going forward. Just on the working capital, yes, we will manage the adjustments strictly in the near term.

We have assumed a stable position in the years going forward as well, even if naturally, our structural characteristics would fluctuate with inventory cycles. It's not something that we want to create volatility around, and we want to have a more robust profile.

So we've built in a stable, conservative assumption each year going forward within the strong free cash flow generation per year corridor. Xavier Marie Simonet Regarding new project integrations, we have no speculative projects for the time being.

In our core markets, we develop and will continue to develop our own operational standards in order to prove that our restaurant teams are capable of executing at the highest levels in terms of cost, innovation, and speed. This is the ambition for our strategic plan.

Our ecosystem is open to trusted partners, and we evaluate requests carefully. But for the time being, we are highly focused on our announced organic pipeline.

Florent Chaix Thank you, Stuart. Thank you all for your attendance on this call.

Have a good day and speak soon. Thank you.

Xavier Marie Simonet Thank you. Bye-bye.

Operator That does conclude our conference for today. Thank you for participating.

You may now disconnect.