Telcos, tires and fast food
Deutsche Telekom, Phoenix Group, Michelin, Interparfums, AmRest, STEF, Gamma Communications, NN Group, Bastide
At Lux Opes, we break down the latest company news into quick takes that get straight to the point—what happened, why it matters, and what to watch next.
Deutsche Telekom (DTE Germany): upping the ante—and what they mean for T-Mobile
Starlink just upped the ante in satellite-to-phone. It agreed to buy 50 MHz of AWS-4 spectrum (2–2.2 GHz) from EchoStar, pairing that with technology upgrades it says will multiply today’s direct-to-device efficiency by twenty and boost capacity one hundredfold. The promise: a user experience closer to LTE than the emergency-text demos we’ve seen so far, and a service that complements terrestrial 5G by filling coverage gaps.
The deal isn’t expected to close until late 2027, but the direction is clear. For Deutsche Telekom, the immediate relevance runs through T-Mobile US, already a flagship Starlink partner; AT&T and Verizon have aligned with AST SpaceMobile, which is materially earlier in its constellation build. Even if satellite coverage is used only a sliver of the time for most customers, it’s a rather polished story to sell: fewer dead zones, stronger redundancy, and a premium aura around network reach.
That’s the “complementary” scenario, and it’s the most realistic in the near term. Satellite is still pricier and, crucially, weaker indoors than terrestrial 5G, so it slots naturally as an add-on to macro networks rather than a replacement.
In that frame, T-Mobile’s position looks better, not worse. Satellite capacity would be provisioned to smooth out rural edges, national parks, disaster zones—places where even the best towers struggle—and the commercial bundle (some plans charging modest monthly add-ons) becomes a differentiator rather than a margin drag. Meanwhile, competitors backing a later-stage constellation face timing risk. None of this rewrites Deutsche Telekom’s 2026–2030 narrative, but it supports the “best network, best bundle” pitch where the Un-carrier is strongest.
But there’s a second, more competitive path: Starlink evolving into a full mobile operator. In theory, integrating 6G and satellite could open a far bigger addressable market. In practice, handset-grade performance still lags 5G by a wide margin today, and urban, indoor coverage is the hardest terrain for space-to-phone links. To bridge that, Starlink would likely need either a roaming deal or an MVNO-style arrangement in cities. If that’s where this ends up, T-Mobile is again the natural counterpart, already partnered and widely viewed as the strongest U.S. network.
Net-net, neither path looks structurally damaging for Deutsche Telekom: one is additive to T-Mobile’s proposition; the other would most plausibly morph into a commercial partnership rather than a zero-sum fight. With the stock already reflecting earlier worries about U.S. competition and currency, the satellite headline adds drama but not, yet, a thesis change.
Phoenix Group (PHNX UK): steady cash mechanics, firm solvency, and 2026 targets still within reach
Phoenix’s first-half update was a reminder of why life consolidators are chiefly cash stories. Operating cash generation nudged higher and outpaced expectations, helped by recurring management actions that keep the engine turning even when the bulk annuity market takes a breather. With BPA activity running light through June, excess cash built up, and the company reiterated a floor for full-year excess cash alongside a familiar priority list: pay down debt, protect the balance sheet, and keep optionality for growth. Non-operating cash was softer versus a tough comparator, so total cash generation landed a touch below consensus, but the core trajectory—mid-single-digit operating cash growth this year, a multi-year cash target that is already halfway met—remains intact.
On earnings, the mix was healthy. Adjusted operating profit came in a shade ahead, with Pensions & Savings benefiting from higher assets and a small uptick in margin, while Retirement Solutions rode growth in its contractual service margin and investment result. Costs helped too: run-rate savings are tracking faster than planned, giving management more room to absorb investment and market noise.
The solvency position continues to sit near the top of the target band even after debt repayment, and pro-forma buffers look sensible once you include BPA written since the period end. The dividend drumbeat remains predictable, and leverage is trending the right way, with a clear path below 30% by 2026 if execution holds.
The read-through is straightforward. A quiet first half for BPA didn’t derail the financial plan, and the backlog of activity since June implies the second half should see better through-the-P&L contributions from deals. Cash remains king, solvency is robust, and the 2026 markers—cumulative cash generation and cost savings—look achievable from here.
That said, the equity story is still tied to discipline: prioritizing debt reduction over splashy capital returns, pacing BPA to risk appetite, and delivering the in-house asset shifts without operational friction. Investors won’t get fireworks, but they should get delivery.
Michelin (ML France): softness around, but the 2026 slope looks better
July’s tyre demand didn’t deliver a miracle, and that was largely expected. In short, for both OE passenger and trucks, there’s some improvement in Europe but continued weakness in North America. The full-year profit rhythm remains back-half weighted, with free cash flow similarly skewed, and that’s consistent with guidance and the way this business has tended to cadence through cycles.
The reason Michelin can keep its bearings in a volume slog is the same as ever: price/mix and a business mix skewed to specialties. Management has spent years conditioning the portfolio to defend margins when units wobble, leaning on premium positioning, disciplined pricing, and a richer product blend. That muscle memory continues to show.
While volumes have underwhelmed for longer than anyone would like, the earnings bridge into H2 leans on improving mix, easing input costs, and restructuring benefits that began a few ears ago and should gather more weight into next year. The upshot is a 2025 that looks okay rather than great, and a 2026 that should see earnings growth re-accelerate as specialty segments recover and the self-help measures flow more fully.
North America remains the weak link in OE for both passenger and truck given macro uncertainty and soft Class-8 orders, Europe is nudging in the right direction from a low base, and China is the outlier: passenger OE getting a lift from subsidies aimed at new-energy vehicles, with replacement steady. Replacement dynamics in the West still carry the distortion of pre-tariff imports, but that effect should fade as the year rolls on.
For investors, the checklist is simple: watch September’s run-rate for confirmation of the Q3 sequential lift, track mix and pricing resilience into Q4, and keep an eye on specialty volume recovery as a lead indicator for 2026. Michelin’s balance sheet and shareholder-return stance remain supportive, and the medium-term earnings slope still looks better than the current multiple implies.
Interparfums (ITP France): solid margins, slightly softer sales outlook
Interparfums delivered the kind of first-half that shows why its asset-light model works in choppier demand: profitability held up nicely even as top-line momentum cooled. Operating margin improved to a little over twenty-three percent, helped by a better mix and tight control of brand support. Advertising spend was kept steady as a share of sales, which cushioned earnings without starving launches. Gross margin ticked up too, a reminder that the portfolio’s center of gravity—well-known fashion houses with disciplined distribution—still lends pricing power. Net profit rose, though more modestly than operating profit, reflecting the normal puts and takes below the EBIT line. On the balance sheet, the move from net cash to modest net debt was expected after the Annick Goutal acquisition; what matters is that leverage remains comfortable for a company whose cash generation is typically back-half weighted.
Where guidance changed was on sales, and the tweak is telling about the market mood. Management now sees revenue “around €900m,” a small step down from the prior guidance, effectively acknowledging a softer second half.
It’s consistent with what the company flagged at the end of July: a thinner order book than a year ago and a fragrance market that has cooled from last year’s heat. Add less helpful foreign exchange and tough comparisons in H2, and you get a setup where the scoreboard may not sparkle, but the margins should still look respectable.
Newness isn’t absent—there are launches lined up for Jimmy Choo, Lacoste, and the in-house Solferino line—but the tone is sensibly cautious. Importantly, management also said it is weighing extra measures to shield profitability after tariff rates were lifted again since the AGM, another sign they’re managing for earnings quality rather than chasing every euro of volume.
For investors, the read-through is that the operating engine is intact even as the category takes a breather. Interparfums keeps proving it can flex spending, lean on mix, and avoid heavy fixed costs when sell-out slows. That’s why earnings expectations don’t need a big reset even if revenue lines drift a touch lower than earlier hopes.
The trade-off this year is straightforward: slightly less growth, still-solid profitability. If the market remains in wait-and-see mode on discretionary spending, the company’s job is to land H2 in line with its toned-down top-line message while preserving that comfortable cushion on margin. Do that, and the story into next year can re-center on the pipeline, normalization in the channel, and the contributions from recently added brands rather than macro crosswinds and tariffs.
AmRest (EAT Poland): cee keeps the engine running while france drags, execution now needs to tighten
AmRest’s second quarter showed a split personality: Central and Eastern Europe did the heavy lifting, while parts of Western Europe, and France in particular, weighed on the group’s profitability. Strip out the supply-chain subsidiary sold earlier in the year and the sales line still grew modestly, with Poland again the standout and restaurant openings outpacing closures. That operational pulse translated into healthy EBITDA in CEE and only a small dip in margin despite cost inflation.
The formula here remains familiar—disciplined pricing, a sharpening digital offer, and steady throughput improvements in the core concepts. It’s why the region now accounts for roughly two-thirds of group revenue and most of the profit resilience.
The trouble lies west of Warsaw. Western Europe’s revenue edged down, and the profit picture deteriorated, with France the clear pain point. Even after exiting Pizza Hut—an intentional move to prune a margin-dilutive format—the EBITDA contribution in France collapsed to a sliver, suggesting that what’s left is still underperforming and the local cost base has not reset quickly enough. Spain and Germany offered some ballast with growth, but not enough to offset France’s squeeze.
Net profit for the group missed by a wide margin versus market expectations, less because the restaurants are fundamentally broken and more due to heavier net financial costs and an unusually high effective tax rate in the quarter. Those are fixable over time, but they add urgency to getting Western Europe back on the front foot.
What to watch next is less about the headline growth rate and more about surgical execution. In CEE, the task is to keep momentum without over-opening, protect the nineteen-ish percent EBITDA margin, and continue nudging average ticket and digital mix. In Western Europe, the to-do list is longer: finish the cleanup in France, re-shape Sushi Shop where pressure seems persistent, and be ruthless on underperforming boxes and overhead.
There’s no shortage of levers—menu engineering, labor scheduling, delivery economics, and footprint optimization among them—but investors will want to see evidence of traction by the next couple of quarters. If management can stabilize France and sustain CEE’s cadence, the earnings bridge into next year becomes much easier to believe.
STEF (STF France): a messy first half, but the core engine and investment case remain intact
STEF’s half-year headline numbers disappointed, and the reasons are very specific: one sizeable tax adjustment in Italy, higher tax pressure in France, and integration costs tied to recent Benelux deals.
All three hit at once, masking otherwise decent underlying progress. Revenue grew at a solid clip, with like-for-like gains that show the network is carrying more volume and capturing share. France, which remains the anchor of the group, held its operating margin near five percent thanks to resilient transport activity and fresh wins in the large-retail logistics segment, even as frozen-food warehousing felt a lull from lower fill rates. International, by contrast, swung to a loss, largely because Italy was pressured by subcontracting costs on top of that exceptional VAT adjustment, while Belgium and the Netherlands are still digesting acquisitions.
The cash-flow picture tells a more balanced story. Capital expenditure came down from last year’s peak, and free cash flow, while still slightly negative, improved markedly year on year. That matters because STEF’s long game is built on continuous investment—network densification, site upgrades, automation—that tends to depress margins in the near term and pay back over the following twelve to eighteen months.
Management’s message was clear: the first-half print does not reflect the group’s structural earning power, and they expect profitability markers to improve as integrations bed in and the extraordinary items roll off. The model has weathered many cycles by pairing local operating discipline with a pan-European footprint, and nothing in this half suggests that equation is broken.
From here, it’s about execution and cadence. In France, the goal is to keep the transport business tight on service and yield while ramping the new GMS contracts to full efficiency. Internationally, Italy needs a rapid reset on subcontracting and cost pass-through, and the Benelux platform has to clear integration friction so synergies can show up in the P&L.
None of that is trivial, but it’s also not new terrain for STEF. The company didn’t issue precise guidance, which is par for the course, yet it did flag an internal expectation for better profitability in the coming months. The long-term pillars—leading positions, disciplined pricing, and an investment flywheel that compounds—are still where the equity story lives.
Gamma Communications (GAMA UK): h1 shows slower uk growth but costs remain under tight control
Gamma’s first half was a classic “good housekeeping beats a tougher market” update. Revenue grew double-digit at the group level and profitability tracked broadly in line with what the market was hoping for, even if sales landed a touch shy of consensus. The earnings mix tells the story: adjusted EBITDA came through on plan and adjusted EPS nudged ahead, helped by firm cost discipline and a business model that scales well without a lot of extra overhead. Below the headline, there were the expected exceptional items tied to the main-market move, the Starface acquisition and ERP work, which weighed on reported EBITDA.
Balance-sheet wise, the company remains in a healthy position: still net cash positive after buying Starface, and continuing to retire shares under its ongoing buyback program. Management kept guidance intact and even pointed to the high end for EPS, signaling confidence in how the rest of the year is set up.
The softer note is the UK, where growth decelerated again. Gamma flagged this backdrop back in May, and H1 confirms it: only low single-digit progress in both the indirect and direct channels, with the wider macro and a cautious customer tone slowing new wins and upsell cycles. The good news is that UK margins held up—gross margin stayed just above the halfway mark—which suggests pricing remains disciplined and the mix hasn’t deteriorated.
Outside the UK, the strategy to build a broader European footprint is quietly doing its job, with Starface adding capability and optionality in Germany, even if the near-term contribution is modest. The step up from AIM to the LSE main market and the FTSE 250 inclusion haven’t yet translated into a rerating, but they do expand the potential shareholder base over time.
From here, the watch-list is straightforward. First, stabilization in UK growth: even a modest re-acceleration would go a long way toward rebuilding confidence. Second, proof that the continental strategy can add a second engine—Starface integration milestones, cross-sell into existing partners, and a steadier bookings cadence. Third, continued cost control to keep EPS at the higher end of the guided range if revenue stays patchy.
None of this requires a change in playbook; it requires execution and a slightly more helpful demand environment. Gamma has the balance sheet, the partner network, and the operating discipline to navigate a slower patch.
NN Group (NN Netherlands): excess capital building again, setting the stage for bigger buybacks
NN’s mid-year picture was one of quiet balance-sheet momentum. The solvency ratio came in a little better than expected, helped by a new longevity reinsurance deal on a sizable defined-benefit block. That lift, on top of steady underlying capital generation, sets NN up to finish the year with a healthier buffer than many had penciled in. Management also nudged its outlook for operating capital generation higher, reflecting a touch of outperformance in Dutch life and a lighter capital load at the bank, even as non-life timing effects shift some recognition into the second half.
The thread running through it all is that excess capital is rebuilding, not just holding up, which matters a lot for what NN can return to shareholders over the next couple of years.
NN hasn’t formally changed the share buyback yet, but the improved solvency, a firmer run-rate in capital generation, and a still-disciplined stance on Dutch pension buyouts point to more room for distributions without stretching the balance sheet.
The company has been cautious on buyouts—its return assumptions are stricter than some peers—so it hasn’t chased volume at any price. That restraint keeps powder dry for other uses of capital and reduces the risk of re-risking the asset mix at the wrong time. There’s also a strategic optionality angle: NN will at least look at opportunities like a potential Ethias process in Belgium if it comes to market, while staying anchored to its capital and return hurdles.
What should investors focus on next? First, confirmation that solvency can land near the two-hundreds by year-end even after the usual year-end moves and hybrid normalization ahead of 2026. Second, clarity on how the EIOPA review flows through; NN’s early read is that negatives can be offset with management actions, which, if borne out, removes a lingering macro-technical overhang. Third, the February cadence on distributions: if the annual buyback does rise as anticipated and the dividend remains predictable, NN’s total capital return could sit around the comfortable ~70% of operating capital generation that long-only investors like to see.
Add in stable non-life delivery and steady new business value in Dutch life, and the setup into 2026 looks cleaner than it did a year ago. The big picture hasn’t changed: this is a capital-return story first, supported by a conservatively run balance sheet and selective growth rather than headline-grabbing M&A.
Bastide (BLC France): steady finish to the year, margin guide intact, portfolio slimming de-risks the path
Bastide closed its financial year with a quarter that was reassuringly in line: sales grew solidly on an organic basis, and full-year revenue landed where management said it would after stripping out businesses that are being sold. More importantly, the company reiterated its operating margin goal for the year, a signal that pricing, mix, and operational discipline are offsetting the usual healthcare headwinds.
Under the surface, the growth engines did what they were supposed to do. The ARD activities (respiratory and related therapies) kept up a double-digit pace, with good traction across Italy, France, and Canada as the network expands regionally. Nutrition and infusion also advanced, helped by share gains in diabetes. Home care cooled a little into year-end—unsurprising given quarterly noise and prior compares—but stayed positive.
The other leg of the story is housekeeping. Bastide is slimming the portfolio with a string of disposals (Baywater, Dorge Medic, Dyna Médical, Medsoft, Cicadum) that are slated to close in the first half of the new year. The rationale is straightforward: focus on the higher-return core, reduce complexity, and use proceeds to bring leverage back below three times post-IFRS-16. That balance-sheet goal looks within reach, and it matters because it gives the company more flexibility to keep investing in growth while withstanding pricing changes like the five percent cut in sleep-apnea tariffs that kicked in on 1 April.
Management also reiterated that the €500m revenue milestone for the new year remains on track despite those pricing effects and the reduced scope—another small proof point that the core can carry more of the load.
Looking ahead, the questions are practical rather than existential. Can Bastide keep ARD and NIP humming in the low-to-mid teens, offsetting any softness elsewhere? Will the tariff reset in sleep apnoea be neutralized through mix, efficiency, and procurement as the year progresses? And will the divestments close cleanly so the leverage line falls on schedule?
The company’s communication suggests confidence on all three, and the full-year margin marker—north of nine percent—puts a floor under earnings expectations as the year gets underway. The investment case isn’t about heroics; it’s about a tighter, more focused portfolio compounding modest growth into steady margin delivery, with a cleaner balance sheet as the safety net.
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The satellite spectrum move really does seem like a diferential advantage for T-Mobile over the AST SpaceMobile partnerships. Even in a worst case scenrio where Starlink evolves into a full operator, T-Mobile is positioned as the obvious roaming partner given the existing infrastructure and relationship. The indoor coverage limitations keep this complementary for now, but the optionality is valuable.