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Operator: Good day, ladies and gentlemen, and welcome to Intertek Full Year Results 2025. [Operator Instructions] I would like to remind all participants that this call is being recorded. [Operator Instructions] I will now hand over to Andre Lacroix, Chief Executive Officer, to start the presentation.
André Lacroix: Good morning to you all, and thanks for joining us on our call. I have with me Colm Deasy, our CFO; and Denis Moreau, our VP of Investor Relations. 2025 marks the third consecutive year of double-digit EPS growth, and I would like to start our presentation today by recognizing all my colleagues around the world for the strong delivery of our AAA differentiated strategy for growth. Here are the key takeaways from our call today. In 2025, we have converted a 4.3% revenue growth into 10.1% EPS growth with a strong margin progression of 90 basis points. Cash conversion was excellent at 110%, providing us with the funds to invest GBP 300 million in growth and returned GBP 602 million to our shareholders. Following the launch of our AAA strategy 3 years ago, our earnings per share have grown 2x faster than revenue. Our margin progression of 240 basis points was ahead of target, and we have delivered a cumulative operating cash flow of GBP 2.3 billion. Importantly, we have increased dividend per share by 17% per year on average in the last 3 years. In 2026, we're expecting a strong performance with mid-single-digit like-for-like revenue growth, further margin progression, strong earnings growth and a strong cash generation. Let's start with the highlights of our 2025 performance. We have delivered indeed a strong financial performance. Our revenue growth was robust, up 4.3% at constant rate and 1.1% at actual rate. Operating margin was excellent at 18.1%, up year-on-year by 90 basis points. Operating profit growth was strong, up by 9.3% at constant rate and 5% at actual rate. EPS grew at 10.1% at constant rate. ROIC was excellent, 21.3% and our organic ROIC increased by 70 basis points. And as I said earlier, our cash conversion was excellent at 110%. Let's now discuss our like-for-like revenue growth performance. The demand for our ATIC solution was robust and our like-for-like revenue growth of 3.9% at constant rate was driven by both volume and price. Our like-for-like growth in consumer products, corporate insurance, health and safety and industry infrastructure combined, which represent 90% of the group's earnings was 5.4%. The World of Energy performance was driven by 2 factors. First, a very demanding base with 8% like-for-like revenue growth in 2024 and 8.7% like-for-like revenue growth in '23 as well, as you know, a slowdown in transportation technology in the second half of 2025. In the last 3 years, as you can see on the slide, our group mid-single-digit like-for-like revenue growth was broad-based and in line with our AAA targets. The acquisitions we've made are performing very well. We've made 7 acquisitions in the last 3 years to strengthen our IT value proposition in high-growth and high-margin sectors. These investments are value accretive to the group, having delivered in aggregate a margin of 34% in 2025. We are truly excited about the consolidation opportunities in our industry and we will continue to target high-quality businesses. Indeed, 2 weeks ago, we've acquired Aerial PV, a drone-based inspection business to strengthen our value proposition in the solar energy. And last week, we've acquired QTEST in Colombia to expand our Intertek electrical network in Latin America. In the industry, Intertek is recognized for its science-based customer excellence with our ATIC premium offering, delivering a superior customer service. Our high-margin and capital-light assurance business solution is the fastest-growing business. From a geographic standpoint, we've benefited in the last few years from broad-based revenue growth within each region. There's been a lot of discussion about the economy in China, and let me give you an update on the performance of our China business. We had a very strong business in China, operating a diversified portfolio with scale positions across all of our business lines. We've delivered a like-for-like revenue growth of 5.4% in 2025, in line with our 3-year like-for-like revenue growth of 5.6%. We are extremely pleased with our margin performance of 18.1%, which was up 90 basis points at constant currency. We have benefited from portfolio mix, fixed cost leverage linked to growth, productivity improvements, our restructuring programs and of course, our accretive investments. These positive margin drivers were partially offset by the cost inflation and our investments in growth. A few years ago, we announced a cost reduction program to target productivity opportunities based on operational streamlining and technology upgrade initiatives. Our restructuring program has delivered GBP 13 million savings in 2023, GBP 11 million in 2024 and GBP 6 million in 2025. We expect an GBP 8 million benefit in '26 from the restructuring that we have done in 2025. In the last few years, we've increased our margin by 80 basis points on average per year, well ahead of our AAA targets. I will now hand over to Colm to discuss our full year results in detail.
Colm Deasy: Thank you, Andre. In summary, in 2025, the group delivered a strong financial performance. Total revenue grew to GBP 3.4 billion, up 4.3% at constant currency and 1.1% at actual rates. Sterling strengthened compared to major currencies impacting our revenue growth by a negative 320 basis points. Operating profit at constant rates was up 9.3% to GBP 620 million, with operating margin of 18.1%, up year-on-year by 90 basis points at constant currency and 70 basis points at actual rates. Diluted earnings per share were 253.5p with growth of 10.1% at constant rates and 5.4% at actual rates. Now turning to cash flow and net debt. Group delivered adjusted cash from operations of GBP 762 million, down from our '24 peak, largely due to EBITDA being impacted by translation and, of course, lower working capital change than the prior year. Adjusted free cash flow was GBP 352 million, down from our '24 peak due to a lower cash generated from operations, higher interest and borrowing costs, higher cash tax outflow following our strong EPS progression and higher CapEx investments. Turning to our financial guidance for '26. We expect net finance costs to be in the range of GBP 71 million to GBP 72 million, excluding FX. We expect our effective tax rate to be between 25.5% and 26.5%, our minority interest to be between GBP 21 million and GBP 22 million and our CapEx investment to be in the range of GBP 150 million to GBP 160 million. Our financial net debt guidance prior to any material movements in FX or M&A is GBP 930 million to GBP 980 million. I will hand back to Andre now.
André Lacroix: Thank you, Colm. And I'll summarize our performance by division. All comments will be at constant currency. Our Consumer Products delivered a stellar performance in 2025 with GBP 983 million in terms of revenue, up year-on-year by 6.2%. Our 6.3% like-for-like revenue growth was driven by high single-digit like-for-like in Softline, mid-single-digit like-for-like in Hardlines, mid-single-digit like-for-like in Electrical and double-digit like-for-like in GTS. Operating profit was up 11% to GBP 299 million with a margin of 30.4%, up year-on-year by 250 basis points as we continue to benefit from a strong operating leverage and productivity gains. In 2026, we expect the Consumer Product division to deliver mid-single-digit like-for-like revenue growth. We grew revenue in our Corporate Assurance business by 6.8% to GBP 514 million. Our like-for-like revenue growth was driven by high single-digit like-for-like in Business Assurance and low single-digit like-for-like in Assurance. Operating profit was GBP 116 million, up year-on-year by 3% and our slight margin reduction after a strong 2024 was driven by mix and investment in growth. In 2026, we expect our Corporate Assurance division to deliver high single-digit like-for-like revenue growth. Health and Safety delivered a revenue of GBP 347 million, an increase year-on-year of 5.5%. Our 2.4% like-for-like revenue growth was driven by double-digit like-for-like in Food, low single-digit like-for-like in AgriWorld and negative low single-digit like-for-like in Chemical & Pharma after a strong baseline effect in '23 and '24 and a temporary project delays by some of our clients. Operating profit rose 2% to GBP 45 million with a margin of 13%, slightly down year-on-year after a strong 2024, driven by mix. In 2026, we expect our Health and Safety division to deliver low single-digit like-for-like revenue growth. Revenue in Industry Infrastructure increased 5.3% to GBP 858 million and our 4.7% like-for-like revenue growth was driven by a stellar performance from Minerals, double-digit like-for-like revenue growth, mid-single-digit like-for-like in Industry Services and low single-digit like-for-like in Building & Construction with a strong second half. Operating profit of GBP 95 million was up 24%, and our margin was up 170 basis points as we benefit from operating leverage, productivity gains and portfolio mix. In 2026, we expect our Industry Infrastructure business to deliver mid-single-digit like-for-like revenue growth. Revenue in our World of Energy business were GBP 729 million, 1.3% lower than '24. Our like-for-like revenue performance was driven by low single-digit like-for-like in Caleb Brett after a strong '24 and '23, where we reported high single-digit like-for-like revenue growth. Negative high single-digit like-for-like in TT was due to a temporary reduction of investments by some of our clients and a negative high single-digit like-for-like in our CEA business was due to a baseline effect following a strong double-digit like-for-like performance in 2024. Operating profit was GBP 63 million, down 15% due to mix and, of course, a lower revenue in TT and CEA. In 2026, we expect our Water and Energy division to deliver low single-digit like-for-like revenue growth. Three years ago, in 2023, we introduced our AAA differentiated strategy for growth to unlock the significant value growth opportunities ahead. And today, I would like to step back and give you a strategic update on where we are and how excited we are about the future. Our AAA strategy is all about being the best every single day for every stakeholder. We want to be the most trusted partner for our clients. We want our employees to be fully engaged. We want to demonstrate sustainable excellence in all of our operations and community. And of course, we want to deliver durable value creation for our shareholders. Our AAA commitment to all stakeholders is simple, demanding and compelling, quality growth assured. Our clients invite us into the most critical parts of the value chain because they know that our science, our independence and our ethics are nonnegotiable. Our high-quality portfolio with leading scale position is growing in structurally attractive markets where regulation, complexity and innovation are rising year after year. We target quality revenue growth, focusing on selling our ATIC solutions in high-growth and high-margin segments. Our quality revenue growth, combined with strong fixed cost control, productivity gains and disciplined investment in growth deliver continuous margin progression, resulting in strong earnings growth, which we convert into excellent cash generation. That's how the Intertek earnings models compound value over time. That's how the Intertek earnings models deliver durable quality growth. 10 years ago, we recognized that TIC solutions were necessary but not sufficient to give a superior customer service to our clients given the complexity in their global operations. We invented ATIC and today, we are the premium leader in risk-based Quality Assurance. Our systemic end-to-end Quality Assurance, combined with our scientific technical expertise is what makes us truly unique and the best in the industry. Our ATIC approach is industry agnostic, and let me show you some examples on how ATIC works across categories. Here, you can see how ATIC works for a T-shirt in the Softline industry part of our Consumer Products division. Here, you can see how ATIC works for the development of data center, the high-growth areas for electrical and building construction operations. In the fast-growing energy storage market, ATIC solutions are, of course, mission-critical for the performance and safety of batteries. And here, you can see from an ATIC standpoint, how it works in attractive LNG sector, which plays, as you know, a significant role in the energy transition. Our growth model has compounded significant value over time. Our earnings per share have grown at an average of 10% since 2004. Outstanding financial performance starts, of course, with the trust of our clients based on our science-based customer excellence advantage. At the bottom of the slide, you can see a few examples of our Your BMAs campaigns where our clients acknowledge publicly the trust they have in Intertek. And of course, there are many more examples on our website. We are very excited about the growth opportunities ahead. Every day in every industry, we pursue 3 type of growth opportunities. In the outsourced Quality Assurance market, we are targeting higher penetration with existing clients as well as the acquisitions of new clients. In in-house Quality Assurance market, outsourcing remains a significant opportunity. Of course, the most exciting growth areas is the untapped opportunity based on the Quality Assurance work that our clients don't do today and will do moving forward. Our clients indeed invest more today than 10 years ago in Quality Assurance, but they still do not invest enough given the increased risks in their operations. That's why our role of independent quality assure is mission-critical for the world to operate safely. Regulation on quality, safety and sustainability are tightening. Supply chains have become more global and more complex. The energy transition and electrifications are creating new growth opportunities. For sure, innovation cycles are shortening in all categories and consumers are demanding more choice and high-quality choices driving SKU proliferation. Finally, digitization and data-driven assurance increase the value of our science-based ATIC intelligence. Over the years, we have built a high-growth quality portfolio to seize these opportunities in every single of our business line. Moving forward, at the group level, we continue to expect to deliver mid-single-digit like-for-like revenue growth. Let me explain how we'll do that, starting with Consumer Products. Consumer Products, our largest division in revenue and profit has reported like-for-like revenue growth of 5.2% between '23 and '25, ahead of our guidance. As a result, we are upgrading our corporate guidance for Consumer Products to deliver mid-single-digit like-for-like revenue growth in the medium term. In the medium term, we continue to expect high single-digit to double-digit like-for-like growth in Corporate Assurance, mid-single-digit to high single-digit like-for-like growth in Health and Safety and Industry Infrastructure and low single-digit to mid-single-digit like-for-like growth in the World of Energy. Margin accretive revenue growth is central to the way we manage performance at Intertek. Between '15 and 2025, we have step changed our margin performance, having increased our reported margin by 220 basis points. Indeed, we have benefited from our portfolio mix and strong pricing power. We've delivered consistent revenue growth with good operating leverage. We've reduced our fixed costs, both at the operating and management levels. We have reinvented our processes to increase productivity. Our CapEx and M&A investments were made in high-growth and high-margin sectors, and these positive margin drivers were partially offset by the cost of inflation and the investments that we've made to accelerate growth. The margin accretion potential ahead is significant, and we are on track to deliver our 18.5% plus margin target. On cash and shareholder returns, we've also made significant progress between '15 and 2025 with our end-to-end cash performance management. The opportunity ahead is also significant from a cash generation and in terms of return for our shareholders. We'll continue to, of course, be very, very disciplined in terms of cash management on a daily basis. Being the best every day for our customers is mission-critical to deliver quality growth for our shareholders. We do regular customer research monitoring our performance versus our peers, and I can proudly say that Intertek is positioned as the absolute premium leader in Quality Assurance. Being the best for our customers gives us the opportunity to benefit from growing recurring revenues with our existing clients as well as win with new clients, giving us strong reputation in the industry. To deliver superior return, as we just discussed, we consistently convert our revenue growth into faster earnings growth and strong cash generation. On that slide, we provide a benchmark of our performance versus our 2 peers, and I'm pleased to report that Intertek stands out with best-in-class productivity metrics, margin and returns in the industry. Of course, a key component of our superior returns is our accretive capital allocation. We allocate CapEx in working capital, targeting 4% to 5% of our revenue to support growth. And since 2015, we've invested more than GBP 1.2 billion in CapEx. In terms of shareholder returns, our goal is to grow dividend over time with a payout ratio of around 65%. Selective acquisitions to strengthen our leadership positions are important, and we've invested since '15, GBP 1.4 billion in M&A. Lastly, our goal is to operate with a leverage target of 1.3 to 1.8 net debt to EBITDA and return excess capital when it cannot be deployed at attractive returns. Our high-quality cash compound earnings model that we just discussed has played and will continue to play an essential part in unlocking the value ahead and delivering quality growth. We have good visibility on the structural growth drivers to deliver our revenue growth targets. We are confident that we'll deliver the substantial upside to our medium-term target in terms of margin of 18.5%. We have step changed the cash generation of the group and our disciplined capital allocation policy is, as we just discussed, accretive. We'll continue to benefit year after year from the compounding effect of mid-single-digit like-for-like revenue growth, margin accretion, excellent free cash flow and disciplined investments. This is how we'll deliver durable quality growth and unlock significant value ahead. Over the years, we've built 5 enduring competitive advantage, which underpin our confidence moving forward. We operate a high-quality growth portfolio poised for global growth with leading scale position in attractive industries. We are the premium leader in Quality Assurance with our superior ATIC offering, giving us the trust of our clients. Our high-quality cash compound earnings model, deliver industry-leading productivity and returns and our high-performance science-based organization continue to attract the best talent in the industry. And finally, we operate with doing business the right way. This is part of our culture, and this is supported by strong controls, strong compliance and a tight governance. Before taking your questions, let's discuss guidance for 2026 and beyond. We're entering 2026 with confidence in the last 3 years. As we just discussed, we've accelerated our revenue growth to 6% per year and have grown EPS 2x faster than revenue at 12%. Operating margin has expanded by 240 basis points. We've increased EPS by 17% a year, and we have delivered GBP 2.3 billion in operating cash flow and GBP 1.1 billion in free cash flow. We've invested GBP 396 million in CapEx, GBP 211 million in acquisitions and returned almost GBP 1 billion to our shareholders. And above all, we have delivered an excellent ROIC with a 3 average of 21.4%. Our growth momentum was strong throughout 2025. And in 2026, we expect to deliver mid-single-digit like-for-like revenue growth at constant currency with high single-digit like-for-like in Corporate Assurance, mid-single-digit like-for-like in Consumer Products, Industry and Infrastructure and low single-digit like-for-like in Health and Safety and the World of Energy. We are targeting further margin progression, which combined with expected revenue growth will deliver strong earnings growth. Cash discipline will remain in place and will deliver a strong free cash flow. We plan to invest around GBP 150 million to GBP 160 million in CapEx. As you would expect, we continue to focus on delivering a strong ROIC. In terms of currency, the average sterling rate in the last 6 months applied to the full year results of 2025 will be broadly neutral at the revenue and operating level. Beyond '26, of course, the value growth opportunity is significant. We continue to expect our like-for-like revenue to be at mid-single digit and will benefit from value-accretive M&As. Margin accretive revenue growth, as we just discussed, will remain a top priority, and we are confident that there is upside to our 18.5% plus margin target. We remain very disciplined in terms of cash conversion and cash allocation to seize the organic and inorganic opportunities in the market. And of course, we'll continue to reward our shareholders with a 65% dividend payout ratio. In summary, the value growth opportunity ahead is significant. Our AAA strategy is about being the best all the time, and our commitment to all of our stakeholders is simple, demanding and compelling, quality growth assured. That's what our AAA differential strategy growth is all about. We'll now take any questions that you might have.
Operator: [Operator Instructions] We'll take our first question from Rory McKenzie with UBS.
Rory Mckenzie: It's Rory here from UBS. Firstly, I appreciate it's only 2 months, but can you just help us get from the November to December exit rate of 1.9% organic growth to your guidance of mid-single-digit growth for this year overall? I know your outlook comments suggested that some areas are supposed to pick up quite a bit. So could you maybe just give us some more detail on what caused that high single-digit decline in World of Energy in the end of last year and what you're seeing so far this year? And also why Corporate Assurance slowed and why you see a pickup? And then secondly, obviously, it was good to see the strong adjusted EBITA margin progression, but also restructuring charges, I think, have increased quite a bit. H2 was the highest run rate we've seen for several years. Can you share more about where those programs are targeted and why you decided to expense them this year? And also just what should we expect in terms of the payback from those charges?
André Lacroix: Of course. Look, in terms of like-for-like revenue growth, there is no question that in the second half and particularly in November, December, we faced a very demanding base when it comes to the World of Energy. As I just explained, the World of Energy had a very, very, very strong '23 and '24. Just to remind everyone about the data, we had a '23 like-for-like of 8.7% in 2023 with 9.6% in November, December 2023. And then in 2024, the like-for-like revenue growth of World of Energy was 8%, and it was 10.7% in November, December last year. So if you basically put the November, December like-for-like revenue growth, which is the first part of your question in context, if you basically take that baseline effect into consideration, recognizing, of course, as I said earlier, that we saw a demand reduction in the transportation technology industry, our like-for-like revenue growth was 4.7% ex the World of Energy in November, December and was 5.4% in the full year 2025. So from my perspective, yes, you might call it a slowdown in the month of November, December, but a good reason for that. The reason why we are confident about mid-single-digit like-for-like revenue growth is pretty clear from our perspective. Let's go through each division one at a time. If you look at Consumer Products, there is no question that it's a stellar performance in all segments within Consumer Products. We have done super well in Electrical for many, many, many years, and we continue to innovate and drive growth in our all electrical operations around the world. There is no question that we've made tremendous progress in Softlines, and you can see from the numbers that we are gaining market share in the industry. We've won a lot of new contracts. And Hardlines is performing very well, but also quite a lot of new contracts, and VTS is in a good place. So from a pure consumer product standpoint, there is no question that we are very, very comfortable with our guidance for the year. Looking at Corporate Assurance. Corporate Assurance essentially always has a bit of a slowdown in November, December because this is the period where we are at peak capacity, and it's very difficult to basically go beyond the auditors capacity that we had. Having said that, the backlog is strong, and we are very, very comfortable with the guidance we are giving. And as I said earlier in the call, we are investing in expanding our auditors capacity to deliver the orders we have in the backlog. Within Health and Safety, there is no question that Food continues to be outperforming everyone in the industry. We are very, very proud of the double-digit revenue growth, and we don't expect Food to basically slow down. There is no question that there was a bit of slowdown in Chemical & Pharma in 2025 for all the reasons we talked about, but we expect that to basically bottom out in the first half and start growing in the second half. We are obviously seeing an increased order momentum from all of our clients given the temporary cuts they've done in 2025. When it comes to Industry and Infrastructure, and we are obviously comfortable with the guidance that we've just talked about with a stronger H2 than H1, if I were to say it differently. If I look at Industry and Infrastructure, look, Minerals is going from strength to strength. You would have seen our double-digit revenue growth performance well ahead of anybody in the industry. And this is because we are winning new contracts. A lot of our sourcing opportunities are coming our way, given our science-based customer excellence advantage. And here, we're going to have another very, very good year. Moody continues to thrive. And pleasingly, as expected, we've seen a rebound in terms of demand with building and construction that has a stronger H2 than H1. And here, the backlog is very, very, very good indeed. As far as the world of energy is concerned, I'm not concerned about Caleb Brett nor am I concerned about CEA. Transportation Technology, which is the automotive industry will take time to recover, but we expect the demand to start improving in the second half. So when you go division by division, you can see why we're guiding the way we are guiding and mid-single-digit like-for-like is really what we believe we will deliver in '26 after having delivered that for 3 consecutive years in the last 3 years. When it comes to restructuring, very, very important questions. As you know, 2025 was the fourth year of our restructuring program. We have another year to go. And our view is that we give the operations maximum times to fix some of the issues. But at one point of time, we need to make decisions for underperforming units. And we have taken some decisions. We've obviously taken some cost reduction in TT and CMP given the trajectory that we have seen. We've continued to streamline our overheads. We continue to streamline the operational management within our units, reducing essentially a number of layers. And then there were a few sites that come and I felt we had to basically get out of because after having tried for 2.5 years, the results were not compelling and they were starting to destroy value. So that's basically what I could say to these 2 questions. Thank you, Rory.
Operator: Our next question comes from Suhasini Varanasi with Goldman Sachs.
Suhasini Varanasi: Just a couple for me, please. As a reminder, the restructuring charges that you took below the line, I think I missed it, but could you help us understand the quantum of the benefit you expect to SG&A in 2026? And just to help us understand the exit rate versus the early trends, is it possible to give us some color on early trading in Jan, Feb this year?
André Lacroix: The benefit in 2026 from the restructuring we did in '25 is GBP 8 million. In terms of trading, I typically don't comment on short-term trading. But as I just said to Rory, I'm not worried about the like-for-like momentum for the group in 2026. So we're in a good place.
Operator: Our next question comes from Annelies Vermeulen with Morgan Stanley.
Annelies Vermeulen: I have 2 questions, please. So firstly, on Transportation Technologies, you talked about customers temporary reduction of investments, but we've also seen some of the OEMs make quite big decisions around moving away from EVs, for example. So when you think about that business, do you think that there will be any need for restructuring as you try and position it to match where the growth actually is in the market? And what gives you confidence on that recovery in the second half based on what you can see today? And then secondly, just on capital allocation, no new share buyback today despite the still quite low leverage. So can we infer from that, that you expect to continue to do more deals in 2026? And how does the pipeline look in terms of what you're looking for specifically?
André Lacroix: All right. Of course. Let me just double-click on TT because that's the first question you're asking. Essentially, if you look at the global automotive industry and if you look at the European brands, including here JLR, the American brands and the Chinese and Japanese brands, the Chinese market and the U.S. market have always been the biggest but also the most lucrative market for Western OEMs. And essentially, the reason why we've seen a very quick wave of restructuring across all OEMs in Europe and in U.K. here, but also in the U.S. is essentially for 2 reasons, right? The Western OEMs have basically lost massive market share in China because the Chinese OEMs have an advantage in terms of electric vehicles. So the electric vehicle segment and hybrid segment continue to grow globally. The issue is that the OEMs are losing market share in China. And for the European OEMs, the tariff obviously have increased the cost of doing business in North America, which is the second most lucrative market for all OEMs here in Europe and the U.K. So that's why you've seen this massive cost cutting in terms of R&D projects and people and dividend in the short term because these OEMs had to basically deal with short-term cash pressure. When you step back and if you look at where our footprint is for Intertek in terms of Transportation Technology, we are very strong in the United States. We are strong in China, and we've got, I would say, decent operations in Europe. Looking at the investment moving forward, I don't think that OEMs will stop investing on EV and hybrids for all markets outside of the United States because the demand continues to be very, very robust and all the Western OEMs need to dial up their EV and hybrid capabilities to compete against Chinese OEMs. The U.S., of course, we have never expected a huge growth for electric vehicles. And this is a market where the traditional combustion engine will continue to play a big role. I mean the good news for us is that in the U.S., that's exactly what we do in the automotive industry. So we are quite well positioned. My view is that OEMs cannot stop investing in R&D to improve their market share. And we believe that they will resume investments step by step. So we are optimistic for the second half of 2026. As far as the capital allocation question, we did our share buyback last year because our net debt-to-EBITDA leverage was way below our target range. Now we are at 1.3 at the bottom of our target. We basically believe that the opportunities to create additional value for our shareholders through M&A is increasing. We've seen the demand increase in terms of good businesses being for sale. We've done quite a few acquisitions, as you know, in 2025 and the last few weeks. And we believe that being at 1.3 net debt to EBITDA, we are in a good place to putting, if you want our cash to work and deliver superior returns, provide, of course, the opportunities are very significant. If at the end of 2026, we are in a situation where our leverage is below our target and below the threshold -- minimum threshold in our target, obviously, we will reconsider with the Board. But we've always said that if the group is below the minimum threshold of 1.3, we will obviously return excess cash that can be deployed for strong returns. But again, as I said in the presentation, you have seen the returns that we delivered in the last 3 years with the acquisition that we made, it's really accretive to the group. And if we find the right opportunities, we will seize this. We'll remain very, very disciplined, and we'll take a view at the end of when we sit with the Board if there is excess cash that we need to return cash to shareholders. All right.
Operator: The next question comes from Virginia Montorsi, Bank of America.
Virginia Montorsi: I just had 2 quick ones. One is on the margins, particularly in Corporate Assurance and Health and Safety. You've mentioned in the press release some portfolio mix effect. So could you help us understand how to think about these 2 divisions margin-wise for 2026? And then the second one, when we think about CapEx, it's increased slightly year-on-year and your guidance for next year is slightly higher. What are your priorities CapEx-wise for this year?
André Lacroix: All right. Look, I think if you look at the mix effect within Corporate Assurance essentially that we have 2 big businesses, Business Assurance and Assurance and the like-for-like revenue growth was a bit lower on Assurance than on Corporate Assurance on Business Assurance, and this is what the mix effect was all about. And as I said, there was more than mix. We are investing in technology and auditors capability. And in terms of Health and Safety, there is no question that the mix effect was driven by Chemical & Pharma, which was down year-on-year, and it's a really high-margin business for us. We do not guide in terms of margin by division for the year. We give you a guidance for the overall group. We expect, obviously, to deliver margin accretive revenue growth in most of our businesses and there are opportunities in 2026 for both business -- Corporate Assurance, sorry, and Health and Safety to do better.
Virginia Montorsi: And can I ask on CapEx?
André Lacroix: Yes. I mean the CapEx question is pretty simple to think about it, right? We are in a unique position when it comes to seeing growth opportunities in each of our business lines. And we have obviously opened new sites in Asia Pacific, in Latin America and also in Europe. We have expanded certain of our sites in terms of building additional capacity. We, of course, have invested in technology. We are using technology to innovate and augment our value proposition. And lastly, maintenance continue to be important, and we continue also to make some investment, as you would expect in the group in terms of overall IT strategy. So that's basically what we are doing. It's pretty broad-based. There is no single business line at Intertek that doesn't have opportunities to grow with good CapEx investments, and that's what we are doing. You can see with all the announcements that we are making around the world, the type of investments we've done in 2025.
Operator: Our next question comes from James Rowland Clark with Barclays.
James Clark: You talked about the healthy M&A pipeline earlier. Can you just elaborate on how deep this pipeline is that you decided that, that is the priority for capital allocation right now? And how far out do you think this takes the business in terms of the sort of run rate of bolt-on deals for the foreseeable future? My second question is on margins. It's another very strong year within the Corporate Consumer Products division in terms of margin progress. You've spoken earlier about growing a little faster in Assurance, adding auditors and also you're guiding higher on growth in consumer products. Do we assume that the opportunity for margin growth is still there in those 2 divisions? Or are you adding lots of capacity to drive the growth that will maybe delay the sort of operating leverage coming through in those 2 divisions in 2026? And then my final question is on free cash flow. It looks like working capital was the reason that free cash flow was down 15% year-on-year. Are you now happy with the working capital sort of base to run off for 2026, i.e., payables and receivables days are in a normalized position now for 2026?
André Lacroix: Well, thank you very much. I'll take these questions, starting with the third one. Look, I mean, you're right. I mean, we've made so much progress on cash over the last 10 years that we are now in the territory of incremental gains. But we are truly continuous improvement driven organization, and we'll continue to look at opportunities for better cash generation moving forward. There is no question that we can do much better than what we've done over the years, but we are talking about incremental gains. So I would never say that our working capital is the best you can get. I would say it's a very, very good working capital, but we are going to go for incremental gains step by step. And you're absolutely right. The free cash flow was impacted largely by the lower change of working capital between '24 and '25 compared to what happened between '23 and '24. We had a stellar cash performance in '24, as you know. In terms of margin, as I said to the previous question, we do not guide in terms of margin. But the way we operate internally is margin accretive revenue growth is central to how we deliver value for our stakeholders, right? And look, there are opportunities even within consumer products, even with Corporate Assurance to invest and continue to improve margin. And that's the way we are running the company. That's the way people are incentivized because essentially, to basically improve your margin, you've got quite a lot of levers you can pull if you run an operation. It starts with the quality of your portfolio strategy. Are you targeting the high growth, high-margin segments in the industry so that the IP that our engineers and scientists have to offer to the market are basically priced at a higher price points and are targeted to high-growth areas. The second thing is, of course, you've got to stay very, very disciplined in terms of pricing. We are the premium leader as I was explaining during the presentation, wouldn't have the productivity metrics that we have in terms of revenue per headcount, operating profit per headcount and free cash flow per headcount if we didn't have a very disciplined volume price mix management. In addition to that, the fixed cost leverage continues to be playing a big role when you want to drive margin accretion. And despite the fact that you are investing in new opportunities, you should basically always target some productivity improvement. So net-net, we expect our teams to drive margin growth year in, year out. We do not always get there for reasons that we've just talked about, but that's the way we are running the company, and that's the way the incentive scheme is based and this is why we are obviously in the situation where we're in, in terms of margin performance. In terms of M&A, look, we are very disciplined in terms of M&A. We don't have any goals. We don't say we're going to do x number of M&As. We want to be ultra, ultra careful on how we select these businesses. We only target high-quality businesses. And we believe the environment is obviously more positive for M&A in 2026 than it was in '25 and certainly in 2024. And therefore, we want to keep some firepower given the fact that we had a good place with our net debt to EBITDA at 1.3 level to seize the opportunities coming our way. Having said that, we have built lots of bilateral relationships around the world. That's our preferred way of operating. That's how we did, for instance, Envirolab, that's how we did QTEST. That's how we did Suplilab, that's how we did Aerial PV. And building this relationship takes time, and you need to make sure that the owner is ready to monetize her or his asset base at the right time. We, of course, participate in processes, which tend to be very, very competitive and there are situations where we win. But we don't have any quantified goal. It's got to make sense acquisition by acquisition. And the positive news is that we've got a very, very good integration approach. You've seen the return we delivered from acquisitions. We are very clear about where we want to invest. We target high-growth, high-margin sectors. that will augment the IP of Intertek. And we believe that 2026 will be a good year. But I can assure you, we're not going to rush to make acquisition just because we want to say we've done M&As. We do M&As if it makes sense all the way.
Operator: Our next question comes from Victoria Chang with JPMorgan.
Victoria Chang: I have 2 questions, please. And the first one is with the U.S. IEEPA tariff ruling last week and the introduction of the Section 122 blanket tariffs on U.S. trading partners, do you see any impact of this to your consumer testing business maybe in terms of delayed decision-making or pull forward of SKU testing to take advantage of the lower tariff rates on certain products in Asia? And my second question is on your initial thoughts on AI implementation in the business, please, how you're thinking about rolling out AI across the business to deliver efficiencies? And are there particular areas or business lines where you expect to see the most benefit in terms of the cost base?
André Lacroix: All right. I think on tariff, there is no question that the news is better news for China and India than it was a few weeks ago. As you know, we are in the swing of the supply chains of our clients. We are working very closely with them. We've launched SupplyTek in 2025 to basically help our clients figure out what they could do to reengineer their supply chain based on the change potentially of economics, creating new routes, replacing routes. I would say the overriding position within our clients is wait and see. They've made no big decision because the agenda has been moving around. Having said that, there is no question that we are having lots, lots, lots of meetings with our consulting teams, helping clients to figure out would these tariff situations settle at what is expected to settle at, what it will mean in terms of economics and potentially new routes. But the overriding situation is let's not rush and take our time. And you can understand why because these supply chain changes are very, very costly, very risky, very, very timely and people only want to change their supply chain if it really makes sense not for tomorrow, but for many, many years to come. As far as -- of course, we continue to monitor that. But the net news of the new decision is that it's incrementally better for the economics in China and India. In terms of AI, look, we are called Intertek, so we use technology to augment everything we do for our clients internally. And of course, we are investing on AI. If you were to be here in the office with us here next to our conference room, we have a lab, AI lab that is made of engineers that are providing support to our teams around the world to make sure that we develop the right AI solutions for our business. How do we think about AI at Intertek? First of all, we believe there is a significant opportunity to help our clients manage the risk associated to the investment they are making in AI. If you basically take the technology company aside and largely some other industries like medical devices or defense, AI is pretty new for most corporations. I'm not talking about using large language models, which are third-party large language models. Everybody understand that, but developing your own AI algorithms and using agents to basically either improve your customer service, drive more sales or, of course, work on productivity. So that's why we've launched AI2, which is an independent end-to-end AI assurance program to help our customers operate smarter and safer and with the right trusted AI algorithm. This is the external opportunity, if you want. And this is, of course, very, very good news for us. And here, I would say we are at the cutting edge of what's happening in the industry. I think we are the only company to do that, competing with lots of very, very, very big companies like consulting firms and Big Four because we do have the expertise. In terms of using AI on how we do business, there is no question that we are looking at AI to augment the way we deliver total quality assurance for our clients, right? And I'll give you a few examples in a second. There is no question that we are looking at AI on how to improve our productivity, and I'll give you some examples on how we are seeing some benefits from a productivity standpoint. And then finally, we are looking at AI to basically get faster to the right insights and decision-making by doing data science at scale in all parts of the organization to basically see the opportunities or the issues faster and therefore, make better decisions. As you know, we've built an incredible database of financial, nonfinancial indicators that we call 5x 5. This gives us a real depth and breadth of reach in the operations. And this is where AI investments that we are making are making a big difference for us to basically look at some of the big trends and deviations and you understand all of this. When it comes to using AI on how to augment the total quality assurance value proposition of our clients, there is no question that all of our large-scale data-based platforms, the SaaS platform we've launched over the years, we have a very, very, very good position to differentiate ourselves. And we are already using AI to, for instance, provide better targeted people assurance training with our Alchemy solutions. We are using AI to help our clients use platforms like SourceClear and Intertek and RiskAware, which are SaaS-based platforms where essentially it's all about intelligent document processing, getting the right risk-based quality assurance analysis on the trends and therefore, as a client, making some pretty big decision in terms of where you are in your testing investment or assurance investments to be. When it comes to the internal use, we have invested over the years. We use Harvey, for instance, which is a pretty good platform to review client contracts to basically look at large documents when we do DD inside the data room for M&A. And then going into the operational opportunities. Anywhere where we have pretty well qualified digitized process, AI can help us obviously make much, much, much faster decisions and gain some productivity. So the areas that we're looking at, for instance, is in terms of marketing, how do you basically qualify the right leads much faster. Another area, which is an obvious opportunity for us is the quality reviews of our test report, but also our audit report, very, very important area of opportunity where we are investing a lot is resource management. So if you think about scheduling of auditors for BA or if you look at scheduling of inspectors for Caleb Brett or Moody's. And then there is no question that when it comes to global market access, we use AI to accelerate the speed at which we provide the right testing protocols to our clients when they want to go to market in other industries or in other markets -- in other geographies, sorry. And then the real opportunities is data science, right? How do you basically take the work we do for our clients in Geochemistry and Minerals. We do a lot of work for them, and most of our clients do not basically use most of the data. Well, with the intelligence we have on Geochemistry, we can help our clients go beyond the test report. So we are very, very, very excited. Obviously, early days, but I would say that we are at the cutting edge of AI in the industry at Intertek.
Operator: [Operator Instructions] We'll take our next question from Karl Green with RBC.
Karl Green: Just a couple of follow-up questions around the restructuring costs in the year. I just wanted to clarify, did I hear correctly that the SG&A benefits expected for 2026 would be GBP 8 million. And if so, that ratio between the GBP 37 million of charges and the SG&A savings of almost 5:1 suggests that there's possibly savings in other cost buckets beyond SG&A. Is that correct?
André Lacroix: The 8 million is the total savings we expect in our cost base in 2020 -- yes, in 2026.
Karl Green: That's good total cost. Okay. And then just for this year, this fiscal year, fiscal '26, how should we be thinking about likely P&L charges for restructuring costs? Obviously, it's been a consistent feature for the last few years as you've gone through this program. What ballpark number would you point people towards this year?
André Lacroix: Look, we do not guide regarding restructuring costs. This is a process that Colm and I go case by case. We only do that when we believe it's the best way moving forward. I wouldn't want to give you any numbers because, frankly speaking, we're going to take every opportunity at its face value, and we'll do it very, very rigorously. We've got some clear rules on how we book this. As you can imagine, we always announce our results fully audited. So that's been through the mute review of our auditors. But this is our final year of the 5-year program we announced a few years ago, but we'll continue to be very, very rigorous. So I wouldn't want to give you any number at this stage.
Operator: We'll take our last question from Ben Wild with Deutsche Bank.
Ben Wild: Just one remaining for me. I think if I look back at the November trading update and compare with where you ended the year on net financial debt, you ended GBP 20 million above the guide that you gave in November. Just to understand, is there a one-off effect that reverses next year on the free cash flow? Or is there anything else that resulted in the difference between the November guide and the result?
André Lacroix: It's a fair question. When we give the net debt guidance, we never include the M&A. So as you know, between November statement and year-end, we did an additional acquisition. So that's the only difference. There is nothing more to that.
Operator: There are no further questions on the webinar. I'll now hand back over to management for closing remarks.
André Lacroix: Well, thank you very much for your time today. I know it's a busy day. Of course, we are available would you have any follow-up questions. Thank you very much, and have a good day.
Operator: Thank you for joining today's call. We're no longer live. Have a nice day.