Grande Interview - Bertrand Dumazy (Edenred) : Le climat des affaires au plus mal en France

Good evening Edvig.

First of all, where are we? We are present in 45 countries on all continents of the world. So this observation is very fine by geography, and we serve 60 million employees in the world as the leader, as you said, of employee benefits. So in fact, we see in each of our clients who are employers the evolution of their employees. And it is true that everywhere in the world, but more particularly in Europe, and this is the first trend, the unemployment rate is increasing. So we see in our portfolios on a historical cohort fewer employees to serve. So we have an increasing unemployment rate, particularly in Europe. The second thing we observe is a great nervousness regarding purchasing power. That is to say that inflation, the toothpaste has come out of the tube. You are not unaware that since the end of Covid, food inflation is around 25% and we predict 5% more with the conflict in the Middle East. And so we face employers and employees who are very concerned about the evolution of purchasing power. And since our job is to give food purchasing power, we see it and we observe it every day. However, there are differences by geographic area. It is particularly strong in Europe. Less so in the United States and Latin America. In the United States, we must recognize that they have had a train of inflation for a few years, so nothing new under the sun. And in Latin America, these are countries that have lived with a lot of inflation for a very long time. So in fact, it is a bit of normal life on the continent of North and South America. It is new and it has returned to Europe. And in Asia, on the other hand, inflation is well under control.

Well, France, we observe perhaps a bit more acutely. First, we see the unfortunate rise in the unemployment rate since we see it in the number of employees we serve, in fact, portfolios that are shrinking, and that affects first interns, fixed-term contracts, temporary work. So the large temporary work agencies are all clients of Edenred, and in fact they employ fewer people today than they did a year ago. And the second thing is that all polls show, and we see it in the populations concerned, the first concern of the French is the cost of living and being able to live properly, with the first subject being food purchasing power.

Yes, it's your brand. But now, for us, it's meal vouchers. We'll see because there is the possibility of using them on Sundays. Is it a good idea or not? First, you need to know that 20% of French people today can use their meal voucher on Sundays. Why? Because the meal voucher is actually the equivalent of the cafeteria for those who don't have one. And when you work on Sundays, the employer gives access to meal vouchers on Sundays as if I went to work, I had a cafeteria. So already, 20% of French workers can use it on Sundays on a derogation. Is it a good idea to expand? In any case, it was one of the proposals. Yes, I think it's a good idea to modernize, but we must still keep in mind, and it's very important, the social purpose of the meal voucher: it's food purchasing power at work, and it's the employer who finances this food purchasing power for at least 60%. So if we denature its use too much, at some point the employer might say, 'I'm here to pay for your food at work, not outside of work for your family.' Yes. So on Sundays, why not? And we must be very careful not to denature it because if we denature the food purchasing power at work, it's a social benefit that could disappear. So yes to modernization, no to denaturation of the social purpose.

I am neutral. [laughter]

Yes. There you go. [laughter]

Yes. So the first factor of growth is that our second product line, which is called mobility solutions, we are the world leader in fuel card and energy card solutions. In fact, these solutions have enormous traction everywhere in the world, and so this product line grew by more than 10% in the first quarter, in line with what we also produced in 2025. So it's the continuation of the penetration of our solutions, and behind that there is an element which is the electrification of fleets. When you have an Edenred card or application, you have access to 1 million charging stations for example in Europe, and in fact the electrification of the fleet amplifies the use of our solutions. You saw that the Prime Minister revealed his electrification plan with measures to push the purchase of electric vehicles, especially for fleets for companies. Do you observe that? So, we observe it and we are fully in it. That is to say that one of the big growth factors of Edenred is fleet electrification solutions. So if you use Edenred everywhere in Europe, we will help you, as a company, to install the charging stations. We will put behind the software solutions that will allow you to maintain them, but also to consolidate them. That is, you are a fleet manager and you have on your mobile phone all the consumption per vehicle, knowing that fleet managers will have for a very long time a so-called hybrid fleet, i.e., electric and thermal vehicles. And so the consolidation, access to the stations, but the consolidation of consumption is highly sought after by our corporate clients. And precisely, the fuel card, do you see companies saying 'Wait, given the increase in price at the pump, I'm removing them'? What movement? It's exactly the opposite. And that's why we are growing by 10%. That is, when you have a fuel card, even now, it's because a fuel card allows you to do what? As a fleet manager, to control who spends what and when. And human nature is quite creative and sometimes it doesn't use fuel properly. And especially the second thing is that with the fuel card, you have access to a lower price per liter. That is, you will have access to alternative networks where the price of fuel is cheaper. And that's why control plus access to a liter at a price that has roughly increased by 20% makes our solutions even more critical for fleet managers.

So, we are flying by the seat of our pants, and we gave a slightly wide range. But when we look at the good traction we had in the first quarter, in continuity with what we had before, we are confident in our ability to achieve that.

France makes 14% of the group's revenue.

60%. Yes, okay. We'll talk about Italy which shot itself in the foot, in your foot, earlier. What about the impact it had on your stock price? So you gained 4%? Yes. You had, I think you are very proud of it, it does you good, I'll say it for you, 17 sessions of increase. What does that make you feel about returning to the CAC 40? We'll explain that precisely because of Italy, where Italy had a cap on your commissions. That very heavily weighed on your stock, which lost 15% in one session from memory. And so you left the CAC 40. Yes. And what do you say? You say, when will we go back?

First of all, I think of Jacques Chirac who had this wonderful expression: 'Despise the highs, darn the lows.' So we are in the process of darning quietly. That is, quarter after quarter, Edenred's growth continues, and so the financial markets understand that even if there can be a regulatory change with a repricing, the Edenred group is present in so many countries with so many different product lines that we are able to compensate. And so it's the rediscovery of Edenred's resilience. So we are darning our lows with this demonstration of Edenred's resilience. Secondly, the CAC 40 is not an objective in itself.

So that's another subject, but on the first one, the government repriced the system to give it very great longevity. The repricing is painful at the start for Edenred and the other market players. In the medium and long term, it is very good. That is, now we have clear rules. You don't see very well. Yes. All right, you're right, it's very good because for now. That is, now with these rules, the employer will pay a higher share than before, and the dynamics of the Italian market in employee benefits will continue. Why? Because the market is very under-penetrated. You have roughly on medium-sized companies twice less penetration in Italy than in France. The second thing is that at the same time, the Italian government said, 'We want to give more food purchasing power at work to Italians,' and they increased the face value by 25%. Okay. Okay. But if I take the criticisms anyway, we've approached you. So this operation cost me 120 million euros. Yes, indeed. Suspicion of abuse of dominant position on meal vouchers. You put in place, you would have put in place a complex strategy to transfer unjustified costs to large retail chains, and then unilateral change of the electronic voucher acceptance terms. The list is a bit longer. I'll stop there.

Yes. There, there, it's the big black points. What happened? What did you do? What did your Italian subsidiary do? So what our Italian subsidiary did, is when the government said, 'Now for merchants it's 5% and no more.' In fact, the Italian government took part of the subject because a commercial contract with a distributor has a transaction price but also other things. There are reimbursement deadlines and integration fees. From the moment it's only 5%, the Italian boss, precisely, can no longer offer the integration fees. Hmm. And so he now charges the market price for integration fees of our systems into their cash register systems. Where is it? Where is the investigation?

Okay. 120 million, that's what it cost you? So no, that was that. Yes. 120 million was the repricing of the system. Yes. And on 2026, what will happen? So on 2026, what impact will it have on 2026? Well, it's 120 million, 60 million in 2025, 60 million in 2026, but if you remove that, we are growing double digits in Italy. Growth in double digits again because our products are popular as food purchasing power at work. And we have other product lines, that is, we also do solutions called welfare, which are growing even stronger. And we have mobility solutions, so our famous energy cards, which are also growing double digits. There is also Brazil, Brazil which also has a cap on your commissions. If I insist on this cap side because it's the question you might dread, because there will be a reform of meal vouchers, normally in the summer in France. Yes. So in Brazil, in fact, there are two countries in the world where the system was unbalanced, that is, where the employer was paying less than what he should give to his employee. So if I am your employee and you must give 100 meal vouchers in these two countries, they are the only two countries in the world, the employer gave less than 100. And so it happens that the merchant initially had to pay the difference plus our commissions. That's why in these two countries, the governments said, 'Stop, we rebalance the system and we're off again.' In France, we are not at all in that. Brazil, how much does it cost you? How much will it cost you? Listen, Brazil at worst will cost us between 150 and 170 million euros. Yes, indeed. But it's again a one-time effect, and the market is growing double digits. So in the first quarter of 2026, Edenred, apart from that, grew double digits in Brazil because, like in Italy, the solutions are popular.

Yes. There is the reform this summer in France this time. Yes. Even if France is only 14%, we'll remind you. Finally, it's still restaurant, it's 8%. Yes. Do you fear that there will also be a cap on your commission, which is how much currently? So in France, public commissions are around 4%. Yes. Public what? That is, there is a public rate, and then depending on volumes, there are negotiations. So it can't be more than that. Okay. OK. And so, we know that you are lobbying a lot to avoid too great a modification of this reform. How do you see it? How do you perceive it? And what are your concerns? Or on the contrary, listen, the reform as we understood it is a good reform. That is, it's been 2 years, 2 and a half years that there have been several consultations with several ministers. Each time, the consultations and the conclusion arrive at roughly the same thing. In France, the priority is the end of paper. All countries in the world no longer have paper meal vouchers. Let's move to digital in this country. The last paper ticket in Brazil was in 2016. In 2016? Yes, but Brazil is very advanced. Yes. So it's a very good thing for everyone. No more paper. The user will be able to pay to the exact euro, will be able to pay easily with his card, his mobile phone, and that makes cash register and checkout facilities for merchants. So that's priority number one in the reform. Priority number two is to ensure that the system remains well balanced, that is, it doesn't become unbalanced. You see the balance issue. Yes. But yes, and so rebates to employers will be prohibited, which is a very good thing. That helps avoid in 20 years finding ourselves in the Italian or Brazilian situation. That's why this reform is a good reform. It's been discussed for 2 years. Now, it must be presented and voted on, so that we have a stable framework and can invest. I remind you that in France, only 25% of workers have meal vouchers, 25% have a cafeteria, and 50% have nothing. The challenge is that I can invest. I have 400 salespeople in France, I want more to develop the market.

No, I will not modify it, I will amplify it. Amplify it. Well, you'll tell us how. Thank you, Bertrand Dumazy, for being with us. So the boss of Edenred who is very happy with his stock market comeback and all his prospects.