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Operator: Hello, everybody, and thank you for joining us today. Today's call will begin shortly. Thank you for standing by. Hello, everyone, and welcome to Whitbread's FY '27 Interim Results. My name is Lydia, and I'll be your operator today. [Operator Instructions] I'll now hand you over to Dominic Paul, Chief Executive Officer, to begin. Please go ahead.
Dominic Paul: Thank you, Lydia. Good morning, everyone, and thank you for joining the call for our FY '27 interim results. I'm joined by Hemant Patel, our Group CFO, and we look forward to answering your questions shortly. Hopefully, you've been through our release and have had a chance to listen to our results presentation this morning. Before we open up the call for Q&A, I thought I would pull out a few key points. Starting with our first half results. In the U.K., we have delivered a strong trading performance with accommodation sales growth up 3% versus last year, and we have increased our outperformance versus the market. With the delivery of GBP 39 million of efficiencies and AGP-related reductions in our cost base, U.K. operating costs were flat versus last year despite industry-wide inflationary pressures, including the unexpected hike in business rates. As a result, U.K. EBITDA was up 1%, demonstrating the strength of our model. In Germany, we opened 1,800 rooms and delivered double-digit accommodation sales growth that was ahead of the wider market, which was back versus last year. Despite the majority of the previously guided one-off impact falling in the first half, Germany EBITDA still increased by 10%. Now turning to current trading. First, in the U.K., our strong trading momentum has continued during the first 5 weeks with total accommodation sales up 4.5% and RevPAR up 3.2%, and we continued to outperform the market. Food and beverage sales were down 37%, in line with our expectations with the closure of all remaining branded restaurants in September. And in Germany, we delivered total accommodation sales growth of 31% and RevPAR growth of 10%, and we outperformed the market. We are confident in driving a positive second half performance in Germany and remain on course to deliver profitability this year. Alongside our strong trading momentum, we have achieved a lot in the first half, and we have laid the foundations for the delivery of our 5-year plan that will deliver higher margins, cash flow and returns and generate GBP 2 billion of cash flow available for shareholders by FY '31. We have made excellent strategic progress against each of the key initiatives and our Accelerating Growth Plan is transforming our business. Our dynamic approach to capital allocation is key to the delivery of our plans, ensuring that we will always deliver an attractive spread of return over our cost of capital, and we are targeting at least 15% returns on all of our growth investment. So in summary, we're trading strongly with market outperformance in both the U.K. and Germany, and our forward booked position is ahead of last year. We are executing at pace, delivering the tangible results and increasing momentum across all areas of our business. As a result, we remain confident in the full year outlook and the delivery of our 5-year plan. Finally, you will have seen today that we have written to all shareholders recommending them to vote against the resolution proposing the election of the Corvex nominee to the Whitbread Board. Our position is simple. We've got the right plan. The plan is already in flight and gaining momentum, and our business has a highly experienced and strong Board. Corvex's agenda will significantly distract us from delivering our plan, and we believe these distractions will be to the detriment of shareholders. Now we do have a lot of people on our call today. So before I move to Q&A, in the interest of time, could I ask you to keep to a maximum of 2 each. With that, I'll now hand back to Lydia to host the Q&A. Thank you, Lydia.
Operator: [Operator Instructions] Our first question today comes from Jamie Rollo with Morgan Stanley.
Jamie Rollo: The first question is just on costs. You generated about two-thirds of the GBP 60 million efficiencies in the first half. You've beaten your efficiency targets for each of the last 2 years. Do you think there's upside to that GBP 60 million number? And is there any early steer on FY '28 costs, particularly on the energy side? And then the other question on disposal proceeds. Clearly, you've maintained your target for GBP 450 million to GBP 500 million, which leaves quite a lot of wood to be chopped in the second half of the year. Could you just give us a flavor for where your confidence comes from in meeting that number? I see you've given a couple of sale and leaseback yield examples, but just talk about demand for sale and leasebacks given the current gilt environment and sort of timing of that second half disposal process.
Dominic Paul: Thanks, Jamie. Let me answer the first part to it, and then I'll hand over to Hemant. I mean, on the efficiency numbers, of course, you're absolutely right, GBP 39 million delivered in the first half, full year target of GBP 60 million. We've got a really strong track record of delivering efficiencies. It's one of the key pillars of our plan, GBP 250 million worth of efficiencies over the next 5 years. And we are increasingly confident about our ability to drive material cost efficiencies. And I think we did very well to get ahead of that when we announced our updated efficiency plan a couple of years ago. So as you know, we do have a track record of delivering our efficiency numbers. We're very confident of hitting that GBP 60 million, and we will continue to stay focused on driving continued efficiencies. What I think is really important is we're making -- this is not blunt cost cutting. We're making really smart decisions about rewiring and adjusting our business to make it as efficient as possible. And technology is also really helping us in that area. So it's going to be one of the key drivers of the plan. We feel very good about the efficiency plans we've got moving forward. In terms of sale and leaseback, I mean, the short answer is we feel confident in our position on getting to the guided number for this year. Hemant can add a bit of color to that.
Hemant Patel: Yes. I mean on efficiency, Jamie, you're right. We've delivered two-thirds of the program so far this year. A lot of that has so far this first half. A lot of that's come from initiatives that landed last year, so completely transforming our food and beverage supply chain, our labor forecasting, the way we support customers in our contact center, et cetera. So we're seeing the benefits of all that come through. We've got many more initiatives this year, as Dom has talked about, including how the check-in process, front desk and a digital journey for guests. All of that is coming through. We're still expecting GBP 60 million. It isn't easy. It's great that we've been able to beat our targets in the past, but it's not something we should take for granted, and we're working hard to get to the GBP 60 million this year. I'm happy with the phasing of the plan this year. It's great to get ahead of it, but GBP 60 million is still our expected target. We're not giving guidance on next year yet. We're fully hedged this year on energy, well hedged next year. So I'm happy with where we are. But in January, when we get to our Q3 results, we'll give you a lot more detail on inflation next year and our efficiency targets as well to have a much better understanding of the program and also the contracts that we have signed for next year. And then just building a little bit more on the disposal proceeds. You're right, there's a lot we still need to deliver. We're still actually confident of the GBP 450 million to GBP 500 million for the full year. We've delivered GBP 20-odd million in the first half, actually GBP 30 million since then, since the balance sheet date as well as selling 57 restaurants and another hotel as well. The vast majority of our target, we are in discussion on and well proceeded with. So we're feeling very confident. We're obviously very aware of the fact that gilt rates are elevated and might well remain so. What we won't do is do a deal where we don't think is the right -- gives the right balance of shareholder value. What we're trying to do here is recycle capital at kind of 4% to 5% cap rates into 15% returning programs like the Accelerating Growth Plan. That's the intention of this. What we won't do is do that blindly. We'll be able to manage how we engage disposal proceeds, but also how we end up spending capital if necessary. So we'll watch that. But at the moment, we're still very confident with the GBP 450 million to GBP 500 million.
Operator: Our next question comes from Leo Carrington with Citi.
Leo Carrington: Firstly, can I just ask on the Germany pipeline? It's much reduced partly with the openings in H1. I think this puts your open and pipeline rooms around the 5-year target. Is this where you might stop with growth in Germany? Is this where the scale could be appropriate? Or do we expect more thereafter? And then secondly, on top of the activist, a few comments. I guess you've alluded to this, but what is actually wrong about or what element of the activist plan would be distracting? Is there something that they're specifically looking for which you've already taken off the table in arriving at this new 5-year plan?
Dominic Paul: Thanks, Leo. Two really good questions. So let me talk a little bit about the capital allocation plan that we've got and why we're so confident in it. So if you look at the capital that we are going to spend within the 5-year plan, it's actually focused on 3 key areas, the growth capital. So the significant area is accelerating growth plan. And that is truly transformative for our business, removing the drag of unprofitable or less profitable restaurants, replacing them with high-returning extension rooms. It's really accretive for our business, and it simplifies our business. So back to Jamie's question earlier about efficiencies, having a focused hotel group that is simpler and higher returning becomes a much more efficient and profitable business is one of the pillars of the 5-year plan we've got. The next area is U.K. new room growth. Now we've already taken a number of sites out of the U.K. pipeline. We took GBP 500 million worth of growth CapEx out of the U.K. And remember, we'd also slimmed the pipeline down during COVID. That gives us high confidence that the sites that we're investing moving forward in this 5-year plan will be north of 15% returns. And we've got data to support that. The hotels that we've opened over the past few years are already generating circa 13.5% return. They're not fully mature yet. So we have high confidence that those sites, the sites we are investing in and opening in exclusive catchment areas where there isn't cannibalization and are overall very accretive to both our returns and profitability. The third area then for the growth capital is Germany. And actually, if you look at Germany, we've taken GBP 500 million out of growth capital for Germany during the 5 years, which leaves GBP 200 million, GBP 100 million of which will be spent this year. So over the remaining 4 years, we're effectively only spending GBP 100 million worth of growth capital in Germany. The good news is that capital is really focused on the high-returning areas from all of the lessons that we've learned in being in Germany for the last 10 years and specifically over the past few years. So then where we end up with Germany actually is a business of scale. So as of today, we're having this call, we've got 75 hotels open in Germany. So we are creating -- we've already created a business of scale. That means we're getting efficiencies. Moving forward, investing in sites where we have high confidence will generate accretive returns moving to a tenant or leasehold model. You put all of that together, investing in sites where we get north of 15%, recycling capital at a significantly lower rate than that. That's one of the drivers for the significant cash flow creation, shareholder returns creation and an increase in margins and returns. So you're right, the Germany pipeline has come down somewhat. We've guided to 18,000 rooms by the end of full year '31, but it's a higher returning, more profitable business. And the data points to support the delivery of that are clear to see in the results today, see the momentum from both the sales point of view, but actually results point of view in Germany supports that. So that's kind of your first question. And the second question was activist and Corvex. So really interesting, isn't it? I mean we got hammered in the U.K. budget last year on the back of being hammered on the budget before, so the year before. So we had a GBP 60-odd million increase in employment costs, primarily driven by national insurance. And then the budget last year, frankly, the government appeared to have made a mistake and hit the hotel business rates particularly hard. So that's GBP 160 million worth of extra costs that came through in that budget over what now is the next 2 years. And we have 2 ways of reacting to that. You kind of continue with the plan we had, and we adjust our plan quite dramatically in order to actually more than offset those increased costs and deliver materially higher margins returns over the next 5 years. And obviously, that's exactly what we did. And we spent multiple months doing a very detailed piece of work literally straight after the budget last year, supported and guided by a world-class Board and 3 global investment banks. And we came up with what we believe is a very strong plan, which we outlined in April, which will not only more than offset the increase in these costs, it will strengthen our position in both the U.K. and Germany to drive material increases in margins and returns. So we've got a very strong plan. The announcement today, you can see we've got real momentum building in the delivery of that plan. We are literally kicking off every single area of the 5-year plan in terms of delivery. And we have a world-class Board, and we have further strengthened our Board over the last 12 months with a number of really positive additions to our Board. In parallel to that, we have had noise from Corvex. So earlier in the year, they announced that we should do a strategic review. But we already said we would do a strategic review, which we outlined in April. At a similar time, they said that we should put the company up for sale, which is a bit ironic. We're a public company. Obviously, a public company always has to be open for a sale. And then more recently, Corvex has come out and said actually, they don't think we should put the company up for sell, but we should do a strategic review and that we should give them a Board seat. And when we step back and we look at the plan that we've got, which is going to deliver material increase in returns for shareholders, the momentum we've got and the fact that we have a world-class Board, we cannot see that giving a Board seat to an activist investor that appears to be changing their mind and that the Board nominee doesn't appear to offer any material accretive skill set to our Board can be the right thing to do. So our message today is unanimous from the Board, which is we've got the right plan. We've got momentum in delivering the plan. We've got a world-class Board. In terms of distraction, yes, going back over a business review, which we've already done in enormous detail, following the agenda for one shareholder, not all shareholders, yes, that would be distracting. And that risks the delivery of the plan. And let's be completely clear, we're here to deliver the plan, and we're here to deliver significant increases in returns for our shareholders. We're confident of being able to do that, and we don't need distraction.
Operator: Our next question is from Jaina Mistry with Barclays.
Jaina Mistry: Congratulations on the results. Two questions. First one, I wanted to ask about your Q2 RevPAR outperformance in the U.K. because I think it's the strongest that it's been in a very long time, 270 bps. What's driving this? Do you see this as a sustainable run rate? I'm just -- I'm conscious that in your current trading, it's narrowed slightly to 100 bps. So just walk us through what's driving it and how we should think about H2 there? And then question number two, could you remind us how hedged you are on utilities for FY '27 and FY '28?
Dominic Paul: Thanks, Jaina. Yes, I mean, we're really pleased and proud of the results that we've announced today because we think it really shows the strength of the plan that we've got, but also the execution of that. And of course, the RevPAR performance is one of the key ways of measuring that. And you're absolutely right in Q2, our outperformance versus the market widened. I mean this does ebb and flow. And of course, it's -- we're not in control of what our competitors do. We're in control of what we do. So it's quite hard to call what will happen to that outperformance other than the fact that we're very confident that we will continue to outperform the market. What really drove it in Q2? I think there are a few things going on. So we're seeing a lot of dislocation in the U.K. market at the moment. These cost increases that we've been talking about, the business rates and the national insurance. This is an industry-wide issue. Of course, this is not just us. I think we have been particularly rapid at coming up with a plan that will mitigate those cost increases and frankly, better at doing that than our competitors. And we're seeing the industry generally going through a period where they're struggling with cost increases. So you can see -- you'll have seen in the STR data for the independent sector, the numbers are not encouraging for the independent sector. We think that's going to hasten the decline of the independent sector. You can see that's creating very beautiful supply growth for the U.K. And Travelodge, you will have seen from their numbers are also going through a tough patch at the moment. So I think there are a few things happening. The first thing is with every set of industry challenges, it creates opportunity, and we've grabbed that opportunity. We've grabbed that opportunity to really solidify our position in the U.K. market. Our commercial trading engine is doing exceptionally well, the strength of our brand, our revenue management. And it shows that we've got strong pricing power, which is a combination of strength of brand, consistency of experience and we believe the best global revenue management system. You put those things together. And by the way, increasing focus on ancillary revenues, and you can see how we can deliver an outperformance. And then behind the scenes, the efficiencies that we're driving, the simplification in our business, the ability to invest in technology that's going to drive competitive market performance, that is fortressing our business versus the competitive set, and we believe sets us up exceptionally well to deliver a very strong performance over the coming years. So it's a mixture of the industry going through a fairly tough time and our performance and the focus on our performance, I think, being really, really strong. And then from an inflation point of view, a hedging point of view, I'll hand over to Hemant.
Hemant Patel: Yes, Jaina, I mean it's pretty simple. We're fully hedged this year. And we haven't given any guidance yet, and we'll give some more guidance in January for next year. But at this stage, I'd say I'm very comfortable. We're well hedged next year. So I'm comfortable with the positioning. Obviously, very aware of what's happening with utility, gas and electricity pricing, and we'll monitor that carefully, and we'll make sure that we hedge appropriately.
Operator: Our next question is from Tim Barrett with Deutsche Numis.
Timothy Barrett: I just had a question -- first question actually also about the RevPAR trend. What wasn't brought out in that answer was London, and it looks like you were close to 5% in Q2, which is kind of the inverse of what we're seeing in the STR data. So just really wondering what's going on in London and sustainability there. Question two, apologies for mentioning the government again. But since we all spoke, the visitor levy has come out. And I just want to just get to your understanding of that. It feels like it's potentially uncapped. People I talked to think it could be around 5% on average. Do you think you have the pricing power to pass that on in due course?
Dominic Paul: Thanks, Tim. A couple of things on London. So as I think you know, we under-index in London in terms of sites and when we look at our kind of national footprint. And London is a fantastic market for us. There are the recent openings that we've done have been particularly strong, give us high confidence that the new sites are going to deliver north of 15%. So when you look at our performance in London, you have to remember we're under-indexing there. I also think London is one of those markets where there's always strong underlying demand. I mean you'll see London at the moment, lots of business travelers, both within the U.K. coming to London, but also coming from overseas. And of course, there's always a strong amount of tourist travel coming into London as well. You put those things together and the fact that we under-index, it means we can strongly outperform the market. The new sites that we've got coming on, this is a great example of the level of detail, obviously, that we go through on a site-by-site basis. And the new sites that we've got opening up in London, prime locations in areas where we're under-indexed and we have high confidence we can deliver very accretive returns for the group. So that's the fundamental reason for our performance in London. And then when you talk about the visitor levy, of course, we're not in favor of the visitor levy. We've made that clear to the government. A couple of things. One, if it comes into effect, it will be 2028. We believe it will be capped, although initially, they said it was capped. There was then some rolling back from that. We do already have visitor levy in a number of areas. Scotland would be one of those things. We were very quick to get ahead of this. So we made system changes to ensure that the price is shown separately to the customer when they come to checkout, which means we pass all of that cost along. So if we look at the visitor levy, no, we're not in favor of it. It's another tax for U.K. consumers. Yes, we've set our business up to be able to pass on that cost. We also think we've got more pricing power than our competitors. And actually, we'll probably hit them harder overall. But we're already set up to show to customers that is a separate cost.
Hemant Patel: Yes. And then just a couple of points to add to that. On your first question on London, we did put some supply, as Dominic says, the market also put some supply. And what we were able to do there because of our commercial engine pricing power is take significantly more rate. So it's a very rate outperformance to the market. We outperformed the market by something like 7% in that quarter. Rate driven because of our commercial engine, we took so much more rate than the rest of the competition. And the other point on the visitor levy, as Dominic said, we've seen -- we're seeing this in [ Manchester and Liverpool ]. We've got good evidence to say we're able to pass that and pass the price on based on our performance. Again, one of the benefits of our strong commercial engine, our really excellent pricing system and our scale means we've been able to do that really well.
Operator: Our next question is from Kate Xiao with Bank of America.
Kate Xiao: I wanted to ask you about rooms growth, U.K. network expansion. Obviously, you have a 1,000 room guidance, but that's growth. If I look at what you did in the first half, the new openings are on track, but you also closed slightly more than that. I guess any thoughts on your U.K. net rooms growth? Anything you can share there would be helpful. The second question is kind of related. Obviously, you showed in your presentation deck, Slide 9, your U.K. average ROCE has improved to 13%, but that's still below the 15%, which is the hurdle you have for your incremental CapEx. I was just wondering if that means you would look to close a bit more of the U.K. existing network as a result of that.
Dominic Paul: Thanks, Kate. Let me answer the second part of the question, and then I'll hand over to Hemant to answer the first part of the question. I mean if you look at U.K. returns, we are highly confident of driving a 500 basis point increase in returns. And that is because we're fundamentally improving the quality of our business. So let me give you an example, Accelerating Growth Plan. We're removing the drag of the unprofitable or less profitable restaurants and replacing them with highly profitable extension rooms. That's a material driver of improved returns for our business. That site that was previously had the drag of restaurants attached to it becomes a much more profitable, efficient site, and that drives up significant improvements in returns. We're also improving the overall quality of our estate. You're right, there's always some churn that we do where we move out generally smaller subscale type hotels. And then we replace them with newer, more modern, more efficient, larger footprint hotels that have a much higher return on capital and a much higher profitability. So the -- and then we've got Germany, which is moving from a headwind where we've been losing money over the past few years to now a profitable business that is going to increase that profit over the next few years. We then, of course, got our commercial engine driving strong RevPAR and overall sales growth and then really underpinned by a really strong best in global class efficiency engine. So we're improving the quality of our business and then making material strategic improvements to our business that drive this 500 basis points return. And that's what gives us so much confidence. And actually, we think makes us quite an unusual U.K. business that it is improving -- we are improving the quality of the underlying business so much over the next 4.5 years. And that's really what gives us both the confidence in driving returns, but also explains why the returns are increasing so much. In terms of room growth...
Hemant Patel: Yes. I mean, nothing changed in terms of where we're going to get to this plan. We've got 96,000 rooms where we're expecting to get to in the U.K. with the reduced pipeline that we've been discussing. That's made up of these higher returning hotels, particularly focused on London and the Southeast where our market share is much lower, as Dominic just talked about. It's made up of rooms from AGP -- the AGP program, extension rooms. It's also, as we guided in the net, out of about 1,500 room exits as well as part of the 5-year plan, where the AGP are closing -- we're extending also taking some rooms out, obviously, it's part of that program, but we've netted that off to give you that in terms of the impact of that and the guidance. Also some low-returning sites, as Dominic talked about. We don't tend to model those low returning sites. When we take a site out -- it tends to be sites where we're able to migrate most of the trade. And therefore, actually the profitability impact of closing some of these smaller hotels is negligible. So we don't need to model that, which is why we give you the gross room additions. But this year, we're still going to get to 1,000 underlying rooms plus 750 rooms for the Accelerating Growth Plan.
Operator: The next question is from Richard Clarke with Bernstein.
Richard Clarke: I guess one thing that's not been mentioned today is your 2 purchases of the Future Inns in Bristol and Plymouth. Is that a broader trend that there may be some opportunistic opportunities to buy in some freehold sites, either your own or ones from third parties given the state of the U.K. market, the rate environment, et cetera? And then second question, on Slide 26, I think you've got a new definition of ROCE called capitalized lease ROCE in footnote 2. Just wondering how are you capitalizing lease in that definition? And is that the ROCE that you're using for the 15% target on future development? Or is it your other ROCE, which is stripped out the capitalized leases?
Dominic Paul: Thanks, Richard. Let me answer your first question, and then I'll hand over to Hemant. I mean, we are -- we're very, very specific about any new site that we sign off. As I said, post-COVID, we did a [ trawl ] through our pipeline and removed any sites that we felt weren't going to deliver increased returns. Then when we have the increase in business rates, we did that process again as part of the business review that we did at the end of last year, which we announced in April, where we took out quite significant GBP 500 million worth of growth capital in the U.K. to ensure that the sites that we were opening in the future, we were absolutely confident we're going to deliver accretive north of 15% returns. We're generally quite cautious about doing conversions. We like -- we generally like new build because we can make that site super efficient and get scale at the site that drives some cost efficiencies, but also and therefore, the profitability returns on that site. But occasionally, conversions do come up, which are really interesting and those 2 sites fell into that category. It gives us an opportunity effectively to open hotels very quickly after purchasing, spend relatively little -- relatively minimal CapEx on those sites and have an immediately profitable and high returning site. So occasionally, those kind of things come up, but we reject many, many more than that we accept because we are returns focused, and we have a very high bar for these sites.
Hemant Patel: Your question on capitalized lease. This is a definition we use internally in our investment appraisal process that allows us to compare leasehold acquisitions with freehold acquisitions. Obviously, cash flows are very different for those types -- for each type and the accounting is very different. But we need to make sure that when we are taking a new lease on, we're looking at it to make sure it's adding shareholder value. We think about the rent cover. So the [indiscernible] rent cover to make sure we've got a strong cover there and it's adding value overall and to make sure these not too expensive. We also then look at it as if it were an investment upfront, so we capitalize the lease and we, therefore, very prudently trying to get leasehold sites the equivalent of this 15% return on capital that we were looking for the freehold sites as well. So this is just an internal definition that we're using as part of our investment appraisal process. Our overall ROCE calculation is much simpler than that. It's a pre-IFRS 16 view of the world and lets the -- follows the cash flows effectively. So this is prudent. I guess what I'm trying to say is our investment appraisal process is very, very prudent, and it should drive higher returns on capital than we would -- we're targeting internally for shareholders.
Operator: And our last question today comes from Jaafar Mestari with BNP Paribas.
Jaafar Mestari: I have 2, if that's all right. The first one, just on your exits from branded restaurants. Some of the press reports on recent disposals get a bit confusing, an operator like Common Table taking on 57 of your exited restaurants. They're also buying a hotel in the package and then they're talking about rethinking the right menus for hotel guests and building new things together. So I'm aware there's different buckets in AGP. But could you maybe explain some of these edge cases? I thought the main model was closing down the restaurants, converting whatever space you can to high returns rooms and then opening your own more efficient integrated restaurants within the remaining space. Is that still the main model? And then on cost phasing, you've talked about cost efficiencies being 2/3, 1/3 between H1 and H2. So that's helped a little bit. Could you help us understand the potential phasing on some of the other costs? So top of my mind, the GBP 10 million rebranding cost in Germany. Was that all in H1? There's a GBP 40 million disruption from the accelerated AGP in the U.K. Is that, on the other hand, mostly going to be in H2? Lease cost increases with the transactions being back-end loaded, will lease costs increase more in H2 than H1? Just trying to understand if H1 was a little bit helped by those phasing items, please.
Dominic Paul: Thanks, Jaafar. Let me answer the first question about AGP and then Hemant will answer probably some of your second question, but I might have to take it offline to help you through that. So on the first question, a really good question on Accelerating Growth Plan. It's a very, very good data point and evidence of our returns-led focus overall as a business. So if I step back from Accelerating Growth Plan, I talk about what we've done. So we have circa 430 branded restaurants, just about okay pre-COVID, but clearly, as a group, a headwind to us as a group coming out of COVID and therefore, loss-making. We looked at every single site in excruciating detail. And our findings was that roughly half of those sites, it made huge financial sense to build extensions. These are sites which have very high occupancy, particularly during the week, driving high RevPAR and the accretion of adding extension rooms to that hotel at the same time as removing the drag of branded restaurant literally transformed the economics of that site. At the same time as we're doing that to that site, building the extension room. So we've already got over 50 of these sites now open. So we've got good data to support the fact they're performing well. At the same time as building extensions, we built an integrated food and beverage area. Guests really like that proposition. It basically serves breakfast and dinner. It's a tailored menu for our hotel guests, super efficient for us to deliver, but guests like it. So this is a perfect example of a strategic shift that is better for our guests and better for our shareholders. So very exciting. There was another group of sites serving 200s where when we looked at it, we could build extension rooms on those sites. But actually, we wouldn't get a strong enough return on capital. And that's either because the catchment area wouldn't really support a significant size extension or would only be full at certain times of the year like the summer. So we've taken a very returns-led approach and said in those sites, we're not going to build extension. We don't get a strong enough return on capital. We're going to sell the restaurant to someone else who can operate that restaurant. And one of the announcements or deals that we did over the past few months was selling 57 of those branded restaurants to a new operator. This is fantastic news. It means that the majority of those sites are going to be operated by another restaurant operator. They will be serving a dinner menu for the local community, but also for our guests. At the same time, we will build a small and highly efficient breakfast room in our hotel to ensure that we always future-proof that hotel for offering a breakfast for our hotel guests. We know how important that is, and it drives RevPAR growth. So the end position on those sites is you end up with our hotel with a superefficient breakfast room delivering the breakfast the guests want, and then a pub next door operated by someone else that can offer dinner for our guests or for the local community. That's a really nice model and it's a lot better for us than us operating that restaurant ourselves. Now there is time taken to build those breakfast rooms. So in the intervening period, we have a contract with that operator to serve breakfast for our guests for an interim period. But then moving forward, we end up with a highly profitable hotel because we removed the drag of the unprofitable restaurant, a breakfast proposition absolutely secured for our guests, driving high guest satisfaction. And then a local pub next door serving a decent evening meal for our guests and the local community. It is a really good outcome and solution for us. And I think that the pace that we're executing AGP is frankly phenomenal. It's a complicated program. It is the most transformative program, and we're making really good progress. Thank you, Jaafar and then...
Hemant Patel: On cost saving, Jaafar. I mean you've identified most of the kind of key factors. The cost saving program, the efficiency program is probably the biggest one. Yes, GBP 40 million year-on-year effect in the first half of the year, GBP 20 million in the second half of the year. And that's because I said lots of the delivery in the first half has come from programs that started last year, in fact, we pulled forward last year to get more of those cost savings in earlier. Clearly, they build into the base of the cost base permanently going forward, but the year-on-year phasing is, as you said. AGP is quite lumpy. There is the first phase that we've been working through. And then the second phase obviously has a big impact as we start closing restaurants before we fully take the cost out. We saw some of that impact in Q2. We'll see a lot of that in Q3, but then we'll see the cost coming out in Q4. And then lease costs, will be more back-end weighted right at the end of the year. Obviously, the lease costs will start to come up a little bit. Happy to take you offline. Dominic can help you offline with that in a bit more detail. I think the biggest thing is the overall efficiency number, as we said. So there's a little bit of kind of like front half phasing benefit from that. But I think we've got a clear understanding where we think consensus land based on discussions that we have with you and your colleagues.
Dominic Paul: And as you probably saw in our presentation, this year is a year of heavy lifting, particularly on AGP, where we start seeing the benefits come through quite clearly next year. So let me just sum -- I think that was the last question, let me just summarize where we are. We have a great plan. It's going to deliver material increases in margins returns and GBP 2 billion for shareholders by full year -- by 2031. We've got momentum in delivering the plan, and you can see that from our results today. And we've got a world-class Board focused on delivery of this plan for all shareholders. So I really appreciate all of your time today. Thank you for the questions. I'm sure we'll have some follow-up questions, but we appreciate the time, and thank you for joining.
Operator: Thank you very much. This concludes our call today. Thank you for joining. You may now disconnect your lines.
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