Rubis SCA (Euronext:RUI) Q2 2026 Earnings Call

0:00 Welcome to the Ruby 2026 half-year results presentation. For the first part of the conference, the participants will be in listen-only mode. During the questions and answers session, participants will be able to ask questions by filling in the form at the bottom of the live page or orally by clicking on the participation button in the player labeled as request to speak. Then, you will be notified when to ask your question. Now, I will hand the conference over to the speakers to begin today's conference. Please go ahead. Good morning, everyone. I'm very delighted to be with you this morning to present Ruby's 2026 health care results, which are very robust. I'm joined by Jean-Christian Bergeron, Managing Partner and CEO of Ruby's Energy, and Marc Jacquot, Managing Partner and Group CFO.

0:52 Thank you for being with us today. I will start with the key highlights of the first half. Jean-Christian will then take you through the operational review before Marc comments on the financial performance. I will then come back for the wrap-up and Jean-Christian will present the outlook before we open floor to your questions. So let's start with the key messages of this H1. Ruby delivered another strong operating performance in H1 2026. What matters here is not only the level of growth, but also the exceptional quality of the team's execution despite the volatile and uncertain environment.

1:44 All product categories and origins contributed positively. This once again demonstrates the strength of our diversified model across In energy distribution, volumes were up 9% and growth margin was up 16%. This was not only volume growth, but also mixed pricing discipline and efficient inventory management in a very volatile all-price environment. Photosol continued to develop in line with this trajectory, with the secured portfolio up 20-22% year-on-year to 1.5 gigawatts, while power EBDA increased by 13% to 25 million euros.

2:45 At group level, this translated into EBDA of 434 million euros, up 18%, and Next Income Group share of 191 million euros, up 17%. Cash flow from operating activities came to 223 million euros. This was lower year on year, but it should be raised in context. The decrease mainly reflects higher working capital needs due to higher oil prices over the period. It does not change the underlying quality of Reviscash's generation profile. The balance sheet remains healthy, capital allocations remain disciplined, and the first half is strong enough for us to upgrade our 2026 EBITDA guidance to a range of 775 to 825 million euros. In short, H1-2026 demonstrates three things.

3:55 Strong delivery, effective execution in a volatile environment, and a growth underpinned by strong fundamentals. I will now hand over to Jean-Christian for the operational review.

4:09 Thank you, Clarisse. Good morning, all. The main point I would like to make is that performance was well balanced across our activities and territories. So SPG, Fuels and Bitunel all contributed to profitable growth, but each with different drivers. And that is exactly the strengths of our model. We are not dependent on one market, one product or any single driver of performance. So starting with SPG, volumes were broadly stable, as you can see, up 1%, and growth margin increased by 9%, reflecting a more profitable business mix and strong execution across our key markets. So in Europe, growth in France and Spain, driven by a continuing momentum in the gas and further market share gains, largely offset software demand in Portugal and Switzerland.

5:06 In Africa, profitability improved quite significantly in South Africa, supported by Customer growth across both segments, the packed, the cylinders, and the bulk segment. While Morocco benefited from a progressive recovery of industrial demand, mainly ceramics, improved sourcing conditions and disciplined commercial management. More broadly, LPG continues to illustrate the strengths of our model. Our historical positions are quite concentrated in markets that still offer attractive growth potential, while our teams remain focused on value rather than volume.

5:51 Through portfolio optimization, sourcing excellence, pricing discipline, and strong operational execution, we continue to expand earnings at a faster pace than volumes. Now moving to fuels. Volumes. increased by 6% and gross margin grew by 13%. So retail activity benefited from a strong traffic trend across East Africa, by the way, not only in Kenya, but also in Uganda, Rwanda, Zambia. And that was also supported by a more favorable pricing framework. The continued recovery in IT also contributed positively to the performance.

6:37 In CNI, commercial and industrial activity, it was another quite meaningful contribution, especially in Kenya and Haiti, offsetting the impact of increased price competition, price pressure, I would say, in Guyana and to some extent in Jamaica. Finally, aviation continued to deliver a very solid momentum across the Caribbean, and that is supported by the sustained growth of the tourism sector. Before leaving fuels, let me briefly highlight the strong progress we are making in Lubricants. Lubricants continue to establish themselves as one of our key growth engines for the future.

7:22 I am pleased to report that the business is developing fully aligned with our expectations, with already very encouraging results in Kenya and significant opportunities for further expansion across East Africa and other markets on the continent. Turning now to Bitumen, the business, as you can see, delivered a very, very strong first half with volumes up 44% and gross margin up 54%. And this performance was driven by continued growth across Africa, notably South Africa and Gabon. but also in most of our other African markets with maybe the exception of Nigeria where we experienced kind of slowdown in demand. However, profitability in Nigeria remained very strong and favorable project mix and excellent operational execution. So the increase in vitamin volumes also reflects our expansion into Europe, as you know, operations in Europe Antwerp are progressing according to plan and we are particularly encouraged by the positive feedback we continue to receive from customers regarding both quality of our products and the level of service we provide to them.

8:46 This definitely reinforces our confidence in the long-term prospects of the business in Europe. But as always, with B2M it's important to remember that this is a project-driven Our business performance can vary from one period to another depending on project timing and execution. So nevertheless, we remain structurally very confident in this activity. Demand continues to be supported by significant infrastructure needs across our markets. Why would this benefit from a differentiated logistics platform that provides a clear and competitive advantage? So overall, the first half once again demonstrates the resilience and growth potential of our energy distribution business.

9:36 Across LPG, fuels and bitumen, we successfully capture market opportunities where conditions were favorable, while maintaining pricing discipline in more competitive environments. Importantly, our performance is not only driven by execution. Our core businesses are well positioned in markets with attractive long-term growth fundamentals. At the same time, we continue to develop new growth engines, including, as I said, lubricants, but also non-fuel retail activities within our service station network and solar and broader energy solutions for industrial customers. We'll get back to that in a moment. So together these initiatives are expanding our growth opportunities, enhancing the quality of our earnings and reinforcing our capacity to create sustainable value over the long term.

10:32 Turning now to renewable energies, Photosol reached a very important milestone in the first half with the start-up of the Cray Solar Plant. At 200 MW peak, it is the second largest solar plant in France, and this represents a significant step forward in the ramp-up of the photocell portfolio. Assets in operation increased by 32%, while electricity production rose by 28%. This is exactly the type of progress we want to see projects moving from development into operation, and gradually making a growing contribution to cash generation. The 6-year portfolio reached 1.5GW peak, up 22% year-on-year, while forward EBITDA increased by 13% to 25 million euros. These results definitely demonstrate that the Photosol platform continues to mature and that the value embedded in the portfolio is increasing increasingly translating into operating performance.

11:44 International diversification is also progressing and we have a 44 MW peak currently under construction in Italy. We remain disciplined in our expansion strategy. Our objective is not growth The sake of growth is the development of projects that meet our technical, economic and risk-return criteria. So as I said before, Biéron Photosol Renewable Energy is also developing renewable energy solutions that are closely connected to our existing customer base, our CNI customers, including sustainable aviation fuel, for instance in Kenya or in the French Antilles, solar solutions for commercial and industrial customers for instance in Jamaica or in East Africa.

12:30 So as a result, our renewable energy activities are developing along two complementary tracks. First, utility scale solar through photosol, and second, customer-driven energy solutions through this energy in Africa and the Caribbean. Marc, over to you to speak about the financial results of the first half. Thank you.

12:56 Thank you, Jean-Christian. The operating momentum described in the previous section translated into strong financial results for the first half. EBITDA increased by 18% to 434 million euros, mainly driven by retail and marketing. This reflects strong demand with volumes of 9% as well as efficient inventory management, pricing discipline and improved margins across most of our activities. Net income group share increased by 17% to 191 million euros, showing that the operating performance translated directly into the income statement.

13:48 Cash flow from operating activities stood at 159 million euros. As expected, it was impacted by higher working capital requirements, mainly linked to the increase in oil prices over the period, as well as the payment to the French Competition Authority of the 64 million euros Corsica signed. Importantly, before changing working capital, the cash generated by the business was up more than 15% compared to last year. After 90 million euros of capex, net of photos and non-recourse financing, and excluding the coffee caffeine, free cash flows to that 75 million euros. This remains a solid level in the context of higher working capital requirements and helps us Keep our balance sheet healthy and give us the capacity to finance future growth.

14:52 Looking now at the EBITDA bridge, EBITDA increased by 65 million euros year-on-year, or 18%, with retail and marketing contributing 59 million euros of that increase. Let's focus on the main elements, starting with Africa. It contributed the most with volumes up 3% and EBITDA up 33% to 122 million euros. This was supported by two main factors. The first, return margin improvement in East Africa following regulated margin adjustments. And second, Solid commercial momentum, both in fuel and LPG in the distributed markets.

15:42 Bitumen was also a key contributor with higher volumes and margin, notably in South Africa, Gabon and Angola. Moving now to the Caribbean, volumes went up 10% and ABDA increased by 12% to 124 million euros. Haiti continued its recovery in both volumes and margins. Volume also increased across the rest of the region, but unit margins were lower, reflecting the weaker U.S. dollar against the euro and the pricing pressure in Guyana and Jamaica.

16:27 Finally, Europe. EBITDA increased by 25% to 78 million euros. boosted by the contribution from the new bitumen activity. Excluding bitumen, volumes were flat, with unit margins benefiting slightly from robust autogas sales. Support and services was boldly stable, down 2%, while renewable electricity production increased by 42%, reflecting the growing contribution of photosol assets in operation and a good solar load factor in H1.

17:17 Let's now look at our P&L, which is quite straightforward for this first half. As you can see on the top of the TNL, EBITDA reached €434 million of 18% and EBIT increased by €54 million of 21% to €307 million. Our DNA increased, mainly reflecting our new bitumen activity in Europe and the growing number of solar assets in operation. The cost of net financial debt only increased a bit, mainly reflecting new plans commissioned at Photosol. Other financial income and expenses were mostly linked to the hyperinflation infinity and interest income on the receivables from the sale of a bid terminal to iSquare Capital.

18:10 Overall, proceeds before tax increased by 19% and net income group share reached 191 million euros at 17% year-on-year. The tax rate was slightly higher than last year at 2025, benefited from some income tax at a reduced rate. So the message here is quite simple. The strong operating performance translated directly in our income statement. Turning now to the net debt and cash regeneration. The group maintained healthy balance sheets. Corporate leverage stood at 1.3 times EBITDA at the end of June 2026, despite higher working capital requirements linked to the all-price environment and the payment of the dividend in June.

19:07 Adjusted free cash flow, net of 4,000 non-recourse financing, which is 75 million euros, 69 million euros lower year on year. This mainly reflects the 173 million euros in adjusted working capital requirements. When I say adjusted, it's excluding the 64 million cost of cash fine paid in May. Corporate net financial debt stood at €885 million, representing two times the EBITDA. Our ungrown revolving credit facility amounted to €333 million. This gives us the financial flexibility to continue investing selectively while preserving a solid balance sheet and disciplined capital allocation.

20:06 Thank you, Marc. Before moving to the output that will be presented by Jean-Christian, here are the key takeaways from the first half. So first, H1 2026, as you have understood, was very strong, with a DBA of 18% to 434 million euros and less income group share up 17% to 191 million euros. Second, this performance is driven by several factors. A strong demand everywhere, effective execution, a favorable business mix, and efficient inventory management in a volatile all-price environment.

20:57 Third, cash flow from operations was impacting by working capital in the context of volatile and high oil prices, but the underlying cash generation profile remains robust. The balance sheet is healthy and stable with corporate net financial debt at 1.3 times EBITDA. And finally, the first six months enable us to upgrade our EBITDA guidance to a range of 775, to 825 million euros. This reflects our confidence in the group's operating trajectory while remaining mindful of high oil prices, more competitive pricing conditions in some markets, and of the project-driven nature of bitumen.

21:55 Thank you, Clarice. Looking ahead to the second half of the year, and as already highlighted by you, Clarice, we are confident in raising our 2026 guidance based on the key assumptions which have not changed. So the upgraded guidance is justified, of course, not only by our strong first half performance, but also by our positive outlook for the remainder of the year. In the Caribbean, we expect the continued recovery of our IET operations supported by tourism growth and the ongoing development of the Guyana and Surinam economies, while the pricing environment is expected to remain more challenging in Jamaica and Guyana. In Africa, we anticipate continued growth in East Africa, both in terms of volumes and margin, as well as increasing bitumen volumes across Most of the geographies, particularly in South Africa, in contrast, I said it before, even in Nigeria is expected to remain under pressure during the second half.

22:56 In Europe, our bitumen operations should continue to ramp up, delivering strong volume with lower margins, as you know. At the same time, LPG volumes are expected to remain resilient. Auto growth is likely to moderate compared with the strong trend In the first half. So against this backdrop and taking into account the strengths of our first half performance, we now expect to be in the range of 775 million euros to 825 million euros compared to the previous guidance. So to conclude, H1 2026 once again demonstrates the strength and resilience of Rubik's business model diversified, cash generative, operationally disciplined and well positioned to capture long-term growth opportunities while maintaining a strong NLC balance sheet.

23:55 So thank you for your attention and we will now be happy to take your questions. If you wish to ask a question, please either fill in the form at the bottom of the live page or click on the audio participation button in the player labeled as request to speak and wait until you are notified to ask your question. Hi everyone, so we have our first set of questions from Emmanuel Metteau. The first one is about working capital evolution over H2 based on current oil prices. The second one is regarding the situation in Nigeria in the bitumen business for H2. And the last one is about Photoshock's 2027 roadmap and is it realistic?

24:58 Thank you, Emmanuel, for your question. Regarding the working capital evolution in H2, I would say, in general, changing working capital varies, and depending mainly on inventory levels and oil price evolution. So, this first quarter, the main drivers of the increase in working capital was The price of the product increased a lot. A few effects on the volumes as well, but in the majority it was linked to the evolution of the oil price. That is the first comment. So in H2, when you see the barrel today at $100, of course it could have a slightly negative impact compared to H2.

25:54 to the beginning of the year. If it comes back to the 90 level, the change in working capital should be flat in the second half and if it goes down, it will have a positive impact, roughly. Second comment on the working capital, keep in mind that the number used in the cash flow statement includes the payment of the Corsica sign, so for 64 million euros. I will let Jean-Christian comment on Nigeria.

26:32 Thank you. On Nigeria, we just acknowledge the tough situation in terms of volumes for the first half and we see a second half more or less within the same trend. I just want to appreciate the fact that despite volumes a bit on the lower side we have a very positive unit margin so in terms of P&L impact it would not be visible at all in 2026 once again you know that bitumen is not something that we can fully be in control of because you can have new projects you can have projects which are a bit delayed there are many many factors And in Nigeria, for the time being, and we have election next year, so it might also lead to a kind of uncertainty, we have a couple of slowdowns in different projects that we are working on. So nothing, I would say, concerning the long term, but yes, for sure, in 2026, Nigeria will not be the best in class in terms of volumes. But once again, I do insist on that, profitability will remain at a very steady level.

27:51 And regarding your question on Photosol 2027, we remain confident in Photosol's trajectory in its 2027 EBITDA target. The teams are delivering in line with our expectations and the project takes Up to seven years to be built, so we have a pretty good visibility on that. While the environment is more challenging than anticipated, but the underlying trend supporting the development of new weapons remains quite positive. And I'm thinking here about electrification of the economy in Europe, development of data centers, you know, We are adapting pragmatically the base of our investments to the current environment.

28:54 Some of the capex initially planned for 2024-2027 period may be deployed over a longer period of time. As for the rest of our business, we adjust to the situation we face, pragmatically. Maybe following on Photosol, we have two questions, one from Jean-Luc Comas at JCCAD and the other one from Nicolas Royaux at Pompon-Pas. The first one is, your development costs have declined between age 125 and 26. Is this trend set to continue? And the second one about Photosol, Can you elaborate on why power and ETA increased not in line with your prediction

29:47 in H1? In terms of development culture, we reduce a little bit the pace of our development. But the trend is the development culture should be in between. I would say the difference between Power BDA and Consolidated APDA should be between 20 and 20 million euros. So no drastic changes, but we reduced it a bit. And the other question? What about Power BDA versus production?

30:24 So there is a small difference between Power IBDA and the production linked to the PRAI project. The PRAI project was commissioned progressively and went through an extended testing phase. And during this period, a meaningful part of the production was sold at relatively low spot prices, rather than under the higher contract tariffs. So it creates a small discrepancy at this quarter. And still on SotoSol, there's a question about redesigning SotoSol's capex. Is it reflecting lower activity in the French market? And do you expect international to rank up?

31:11 The lower level of CAPEX in H1 mainly reflects the paving of construction projects rather than a change in development for this quarter. For the rest of 2026, we see that H2 will be higher than H1. But again, you know, as I was mentioning, we are adjusting the CAPEX program of Photosome to take into consideration the political environment in France. We then have several questions on margins.

31:57 The first one is about unit margin for the lubricant business and the non-show retail business in Africa.

32:06 Well, first of all, I would like to... Remind you our commitment to grow the lubricant cells. I said it before, just to give you on the first half we have increased our lubricant cells by 20%, so we are definitely getting there. The unit margins, obviously I'm not I'm going to disclose them because it's a bit confidential, but they are very strong, as you know, if you know the lubricant business. So it's becoming, step by step, a key contributor to our postpartum. And we continue to... In terms of non-fuel income, you know our strategy to create a full and comprehensive ecosystem in our service stations.

32:53 So today we have more than 550 shops. We have more than 60 in the pipeline. So we continue to grow. We are also developing partnerships. with a well-known brand, mainly food brand and car maintenance brand. And we have 150 partnerships in the pipe. So you can see the momentum is very strong and we are expecting, again, a strong contribution from the non-dual activities in our gross margins. So this is today where we stand. We said it last time that these are two new growth drivers for the company and we are delivering that. We have two other questions on margins. The first one from the second one from . The unit margin in retail and marketing is down both in Europe and the Caribbean.

33:49 Could you give us the main reports for each region and what to expect for H2? And the second one is how much of the gross margin improvement in H1 comes from structural factors versus temporary inventory data?

34:05 In terms of retail margins, so Europe is not significant because the volumes are very low, but you may know that in Corsica we are suffering a lot because of the pricing policy from Total Energy. So that's a fact, we cannot do much about that, but of course it has a very strong negative impact in terms of unit margin. We are trying to follow the pricing policy, not fully. So the impact is negative both in terms of margin and volumes. So we hope the situation will change, but we obviously have no clear indication regarding the total energy strategy in terms of pricing. Now in the Caribbean, there is a bit of pricing issues. Pressure in two countries, Guyana and Jamaica.

34:51 In these two countries, you have state oil companies impacting the pricing at the pump. In Jamaica, it's the Petrogen Refinery giving some lower price and we try to compete. Obviously, when you want to protect your volumes, you need to reduce your price at the pump. Therefore, a kind of reduced unit margin and same in Guyana. So we don't know what is going to happen in the second half, but we are a bit cautious and we prefer to consider that we continue to meet some more difficult situation. Now, if you look at the other question.

35:37 H1, Rosemont, Jeanne Proulx. That's true.

35:39 It's definitely structural. We have some positive, I would say, margin evolution in East Africa. You remember the commitment that the government of Kenya took two years ago to support the industry in increasing the unit margin. They did the job. Thank you for that, by the way. and we are now much comfortable and we can continue to invest and to grow the business and we have also in Zambia some positive news also in terms of unit margins. So, all in all, a combination of volumes and better unit margins, we are very confident that it's very promising We don't have so much of, I would say, inventory positive effects in terms of retail activities because it's most of the time a regulated framework. So the plus and the minus in terms of positive or negative inventory effects are taken into account by the pricing structure as far as retail is concerned.

37:00 We have a question about the level of CAPEX to anticipate for the full 2026 Usually what we say for Rebis Energy is that the level of CAPEX is normative one is between 180 million euros and 200 million euros so we will be in this range and for Photosol, as mentioned, H2 will be higher than H1. Now we have two questions about the impact of interest rates on the group and how sensible we are to interest rate solutions.

37:48 You know the good news is that our leverage and our debt is quite low so the impact is limited because our base is low and in terms of coverage we have two-thirds of our debt that is covered through swaths or tunnels. Elisa from Finance Connect is asking us to give some color about the different impacts of changes in refining margins on our business and also change and inflation.

38:36 At this level we only have the SARA refinery and you know that it's a refinery where the net income is guaranteed by the government of There is no positive or negative impact of the margins. Now, if you look at the big picture, definitely what is quite new is that despite the increase in the oil price, we also see a strong increase in the refining margins worldwide. So it has a negative impact, obviously, on the end price to customers. And the only question we have, and that we have obviously anticipated that in our guidance, is to see what kind of positive or negative impact the pricing of our products is going to affect positively or negatively the demand for petroleum products.

39:38 That's where if obviously refining margins are very high, therefore the price to end customers will be also higher. It might have a negative impact on the demand. Impossible to say, of course, but we are very careful about how the situation is evolving in the coming months. Another question about emerging economies and the changes in Europe versus Europe. In the macro-environment. We...

40:23 You know, we have 40% of the group ADDA that is exposed to euros, and 50% is exposed to USB, so we have some translation effects. And the rule of thumb that we have is that one cent, you know, of change in the euro dollar creates a 3 million euros variation in the EBITDA. This is something you can keep in mind. Last question from Moab about the support and services business. Is there further rules to respect?

41:07 You know, the support and services business is mostly driven by our fleet and of the freight rate. So this business must remain stable and it will remain stable in the future. A question from Emmanuel Matteau about is there any citable M&A deal under consideration? Emmanuel. M&A in the coming years, it will be a question of opportunity, match with our existing business, and valuation, of course. We have the agility, the capacity and liquidity to see opportunities in the market, but we need to find a good match. So, what we can say today is the potential areas of interest include Independent players in LPG or Fuels in Africa or Caribbean.

42:15 Opportunities in Europe if we have synergy with our existing business. And of course, extension in bitumen as we have done it in Europe. We could find some other opportunities to increase our bitumen European business. So that's all I can say today, for instance. If we go further in interesting M&A targets, we will be informed by the right medium. This ends the question and answer session, so I hand the conference back to the speakers for any closing remarks.

43:03 Thank you all for being with us today. We are happy to answer any other questions you may have. Do not hesitate to send an email or to call me. And we'll be on the road in the coming days, today in Paris, next week in the US, and the week after in Asia. I'll see you soon. Thanks a lot. Thank you.