Ladies and gentlemen, thank you for holding, and welcome to the Sika Food Group Event Call. During the presentation, all participants are in listen only mode. And later we will conduct a question and answer session. I would like to hand over the conference to Mr. Hope from Ashlar.
Go ahead, please, sir.
Thank you, and thanks, everyone, for dialing in on this, presentation on our half year figures 2020. I would like you to take you through the presentation that we have made, which you can download from our website, for about let's say, 20 minutes and after that, there's sufficient time for questions and answers. And I would like to start on sheet number 3 to explain a little bit more about the, development of the, of the net sales. Of course, it has been a very strange first half year of course, we grow with, of course, a major impact of COVID-nineteen. And the measures taken by, by local governments in the Netherlands and Belgium, to address the outbreak.
And that had a huge impact on many of the customer segments that we service as sligro in both countries. In the end, we see that after the first half year, we have a 17% decline in sales. A little bit over 20% organically because some of it was compensated, of course, by the acquisition of the quake that we did last year. But of course, also in the Quaker, sales added, which is now 42,000,000 well, without COVID, we have expected that to be, let's say, 10,000,000 dollars, $15,000,000 higher. So besides the organic impact COVID, of course, also in the acquired, net sales from the quaker, there is an inherent COVID impact.
We do see a gradual improvement in, in the net sales development. So immediately after the COVID-nineteen outbreak and the effects in the Netherlands and Belgium of mid March, we saw that, our, our sales drop with 55% and is slowly recovering to 35%. That doesn't match with the overall, minus 17 over the first half year. That's because these percentages reflect the net sales, excluding tobacco sales, and tobacco sales, which we typically have as a service product to petrol outlets, they they remained at, 100% even showed a positive index. And as those sales are roughly 10% of our business, that had a very distorting effect on the development So the quality turnover was reduced by a 55% back up to 35 by the end of June.
And fortunately, and that's a little bit forward looking. We see that, as of July, that trend improved further, luckily, because again, a number of measures were, were relieved, in the Dutch market, which means that the hospitality sector is is improving further. I will say a little bit more about that later on in this presentation. Well, so we saw that in the Petrol segment and Healthcare, the decline was was limited in hospitality, roughly 90% of the business disappeared overnight. Unfortunately, at this time, we are roughly, around 90% back.
So only a 10% decline in hospitality. Catering and events, business catering specifically has declined significantly and also events, of course, and they are still to date at very low levels. So roughly 25% of what it, what it used to be. And that's, of course, the effect that people work from home and not in the offices and major events are not yet allowed. So that part of the business is still at a very low rate compared to the levels last year.
Fortunately, we are one of the players in the food service market that have both, delivery and cash in carry, in their portfolio. The big chunk of the decline was in the delivery part of the business. So we saw minus 75% at the low point Casing carry more or less managed to stay afloat, and today shows positive indexes compared to last year. And that means that the, the mix delivery for SKUs has been significantly compared to last year. Where, with a 68% delivery was very dominant last year, we see that, the gap was closed from to 59, 41% cash in carry.
And then of course, there's also positive impact on gross margin. And as mentioned, the Graker also, of course, was hit. So the acquisition turnover would have been higher without COVID. On the next slide, we see this in the graphical form, where we see that we started the year quite successful with the turnover levels above 2019 than the major dip with the biggest impact in April and then the recovery from that moment onwards. Which fortunately, it's extended into July as, as well.
On sheet number 5, the summary of the measures that we've taken to cope with the, with the loss in net sales. I think we've managed, we've mentioned most of these measures already in previous press releases, but these measures, altogether, have helped us during these last few months. To keep an EBITDA level above 0. So positive results, which means that we didn't have a cash outflow from the operating results of course, net profit was impacted severely, but our focus was not as much on profit, but more on cash. So having a cash neutral or cash positive operation was the primary goal.
And we succeeded to get to that in all of the months during COVID, to a large extent, with diminishing impact of government support. So that meant that in June, we, no longer make use of the, the Dutch government subsidies under the MOW arrangement and still we had a positive EBITDA. So we see that the recovery is in progress, and of course, we hope that that will, we'll be able to extend that into second half of the year. But of course, we want to remain flexible. So in the second half of the year, we prepare for a longer recovery period, further adaptation of the, of the organization.
And of course, also getting the financing in order to support that. And, well, at least preparing for a potential 2nd wave, which could happen, and to make sure that we then have sufficient flexibility in the organization on the one hand and sufficient funding in place on the other hand to, to get through that, that period. And we think we will be successful in that in the second half of the year. Then moving along to sheet number 6 on gross margin, had gross margin as a percentage of sales has declined a specific because of all the mix impacts, but also because we had an extra amount of shrinkage Of course, we have a lot of fresh products in our supply chain, and with a certain a drop in sales overnight, of course, before we have the supply chain in order, that takes a while, and that led to an additional 3,000,000 shrinkage as compared to, to last year. Looking to other operating income on sheet number 7, not a lot of, big items in, in 2020.
We sold off, some real estate objects some, which, were in the sale and leaseback. So we have a cost in the future. But also we sold 3 locations, that were on our assets for sale list, which we, which we were able to divest. On one of the items, on a 2 of the items, we had a booked profit of around 1,000,000, which is presented here on the other operating income. And of course, in the comparables last year in the first half of the year, we still received a fee for the services that we have received from the consortium that bought N Pay, which is now, as of the second half of last year completely gone.
So in the comparables, that's a 1,000,000 difference. Then looking at the operating cost we have to bear in mind. It's going to sheet number 8. Of course, that we have a consolidation effect of the quaker, which adds roughly 11,000,000 in, in, in cost, specifically on, on, on employee expenses. But you can see that we were able, from that level to reduce costs significantly, combination of subsidies in the Netherlands and Belgium.
But on the other hand, severe measures that we've taken to scale down staffing costs, flexible staffing and also transportation costs. One impact, of course, here is also the provision for bad debt a amount of 1,000,000 was added additionally to that provision as a result of the position of the current receivables. And, and the loans with, with customers. We are not too, too disappointed about that level. And we tried to facilitate our customers whenever possible to give them some, delayed payment terms to, to 1st be able to recover that business before they started to pay the old balances with, with Fugrove, and we see that we get a lot of appreciation in return and also that most of our customers are able to, to fulfill the repayment schedules that we have agreed So we see that the money is coming in, and we don't run into huge problems.
But of course, a $3,000,000 additional provision is, is it's quite a lot of money still, but much less than we anticipated at the start of this, this, this crisis. If we then go through depreciation and amortization, have we we put some of the software in Belgium, all software in Belgium out of use, and we have successfully launched our new, web environment on SAP, which means that the old environment will be put out of use, and we have some remaining book value of that, which is now fully amortized. In the first half of the year. On the other hand, we see an increase of the lease related expenses of course, in the last couple of years, we've done quite a lot of, still on leaseback transactions. And of course, that increases the lease amounts in this in this part of the P and L.
On the other end of this year, of course, an extraordinary item is the impairment on Belgium. And I want to go to the next slide to explain a little bit more about this. Does this mean that we don't have any confidence anymore in Belgium no, I would say on the contrary, we think we can be very successful in Belgium. And straight as it may seem, we think that the after effects of COVID and the impact it will have on the market at a competitive landscape will put us into better position eventually. But of course, we also have to do the impairment analysis on a technical basis.
We knew at the end of 2019, as explained in our annual accounts, that the headroom in Belgium was, was quite limited. And we see, of course, that with the impact on specifically on the short term, of COVID and the recovery phase in 2021. In combination with an increased risk profile. And as a result of that, a higher WACC, the outcome of the impairment calculation is that we are not able to recover the full investment base in the next 5 years. We will eventually expect, but of course, we have to take, the, the impairment into our accounts based on the outcome that we have today.
And that leads to an impairment of the, of, of some of the elements in, in, in Belgium. It is mainly goodwill, So the full goodwill that we paid for YancePC IPC is now, impaired including also the other intangibles on customer relationships, the locations, the other intangibles on the locations that we have built in the brand names remains and will be advertised through the P and L in the next, in the next years, as we have done so in the last couple of years. That doesn't, of course, mean that we are, happy with this. It's just, and it's not the only technical effect. Of course, we fully realize that, we still have to prove that we can get built into a profitable situation.
We think we are doing the right things to get there. But, the results so far are not on the level that we expected, but we think that we will be, we will manage that in the right direction in the next couple of years. Then on page number 11, a number of remarks on the financial income and expenses, not a lot of strange things. Of course, the fiscal position with a, hitting the result. It's, of course, also a little bit atypical, as presented here, and this includes also a release also deferred tax liability related to the impairment that I just elaborated on.
But for the rest no specific items to be mentioned, on this slide. On sheet number 12, we put in, an EBITDA bridge from reported to the EBITDA we used for our covenant calculation. It's a question that we received a few times from various investors and analysts. So we thought we would include it here in the presentation, to show how we get from reported EBITDA to the one we used for the covenants calculation. On seat number 13, I think, yeah, of course, the summary of net profit and how that translates into earnings per share, we already, announced and was also confirmed during the general meeting that we won't pay the closing dividend for 2019.
And that we stick at the interim dividend that we paid out during 2019. We also communicated with an update on the financing that, well, on the one hand, as a result of the new financing agreement, we, we would not pay an interim dividend in 2020, but we also already announced that we do not see a basis in the results of 2020. To pay a dividend altogether over, over 2020. So also not in, in 2021. And I think the results that we presented at the the midyear support that, that, that remark.
So we give full priority to recovery up the financial position And of course, as we will recover again in the course of 2021, then we will see what the opportunities for dividend will be going forward. Then maybe to, uh-uh, in these times, the more important table to show, which is the cash flow statement on sheet number 14, there we clearly see the impact of, of COVID and the impact of our efforts. So on the one hand, of course, we see that, the operating flow from operating activities is down significantly as a result, of course, of the lower operating results we managed the working capital, more or less at a stable level compared to compared to a half year ago. So no big changes in that. Of course, we also used the opportunity to defer payments of, wage taxes and duties, and we will, pay those in the in the months of July June.
For the rest of the year, we won't be use of any delay. So by the end of the year, we we will have paid all, all amounts due. Another important point is, of course, the investments. We have reduced the investment levels to the maximum extent. But of course, we have finalized a number of projects that we were working on on one hand, of course, the all the distribution network changes, that we required for the Heineken Seadrill integration that is now, almost finalized, which means that the Apex program related to that.
So also almost finalized in the first half of the year, we still spent 1,000,000 on that which is, of course, we cover to, to a large extent by the divestment of these assets in the sale and leaseback transaction. But it means going forward that, also in light of recovery from COVID, but also plant regular business going forward, the CapEx levels of Figuero will come down to, much lower levels compared to the last 3 years going forward. And then of course, will help in the further recovery of our financial position going forward. Then, on the next sheet, there's a segmentation of the cash flow. I think there's not a lot to add to that, statement.
Just a split up between the Netherlands and Belgian. Then on sheet number 16, a few words on the financing side. Of course, when we saw what happened to our business mid March, we made new forecast and anticipate it with the knowledge at that time that we could run into issues on the governance that we have in our financing agreements. So we immediately started, discussions with our banks and our financing partners, to get some more headroom in case, these, these forecasts would materialize. Before the end of the first half of the year, we came to an agreement with both banks and the use for P financing partners.
To, to have at least, some more headroom available in case we would break through the covenants, unfortunately, the efforts we put in and the measures we took to, to safeguard financial position have paid off to such an extent that in the end, we did not meet this, this extension, and we ended up at a leverage ratio of 2.5 where in the original agreements, the level was a maximum of 3.0. So we did not meet the extended headroom that was provided. We are very happy and grateful to the funding partners that were willing to support us to this extent And of course, there's still a lot of uncertainty to come, but with the current feasibility, we also expect that we can stay within, the the limits of the covenants by the end of this year. But of course, still, a lot can happen in, in a short period of time. As the first half of twenty twenty, as shown.
But we are not too pessimistic about that. It also means that, we have sufficient liquidity available to fulfill our repayment obligations by the end of the year. Which is a repayment of $75,000,000, on the USPP, deal that we did in 2010 and a scheduled repayment term of $10,000,000 on terminal. So, we have sufficient liquidity to cover for those repayments. In the second half of the year, we are going to revisit the funding structure that we already planned pre COVID, and we're going to finalize those discussions in the second half of the year.
To have a more structural, midterm funding structure in place, again, that also supports the ambitions of legal funding. In the next sheet, we see the segment figures. I think I will skip that and go on to sheet number 18. A short update on where we are in view of the claim that was put forward by Jumbo and co op, the consortium that both ente I think the positioning is well known to the market. We had a preliminary hearing session, a few weeks ago in which we were able to confirm our position and we feel that we have a strong position in this case.
So we don't expect that there is a chance for the consortium to put their claim forward successfully. This is also the reason why we have not provided for, any amounts in, in our results, I think, because we think in the end, this claim will not be successful. And, going to, some more information on what we've done in the Netherlands. On June 20, you could see the, for us, most relevant, economic indicators, consumer confidence and, unemployment. Of course, COVID had a major impact on consumer confidence and we see a turn in the trend line of the unemployment rates We think this will also be a factor going forward in our markets after the big impact of of COVID.
So it's something that will, of course, have an impact on future development of the market. Actually, number 20 month, I wanted to summarize that the most important developments, what what did we see happening in the first half of the year, of course, the shift some food service to retail. So people no longer eating in, in restaurants about eating at home. This had a big impact on the supermarket development. We've played a role in this for a short period of time.
We opened up our cash and carry for the public, but also we shut down again once the hospitality sector could reopen on June 1st. The measures we've taken, I already addressed those in the previous sheet. But I think also important that during the the last couple of months. We did put a strong focus on continuing the most important strategic programs and we could even accelerate the integration of the creative. We plan to integrate, in the first quarter of 2021.
We will now be able to do that in October of this year. And also the integration of the Heineken premises was was, at a higher speed, which meant that last week, we closed the last Heinke distribution center. So now all of the old locations of Heineken are integrated in the network of SQL. So as soon as business starts picking up again, we see this already happening in June, July. We expect to benefit from the fact that it's all integrated already.
Of course, we spent also a considerable time and effort on the SAP implementation, on two ends. 1, the online environment, which is, migrated to SAP Hybris, that has gone live as planned. Around the half year. So the first two customers are onboarded and, in the second half of the year, all of the customers or she grow and also the combined customers with Swidwar and Heineken will be onboarded in the second half of the year on this new SAP platform. So that was the 1st big go live under SAP.
Which we've done successfully. But on the other end, we see that the preparations on the ERP landscape and the next phase, which is the preparation for go lives, requires are people to be, available also on premise, and that in these times of COVID is very difficult. So as a result of that, we have pushed bonds, the goal lies to, to next year. On the other end, I think we have been very successful so far in the build of the system, which is, which is almost finalized for the first proposed title. We will now to work on integration and testing, on the other hand, we have prepared our business in terms of process alignment already to, to fit, the new way of working in, in SAP, which are a few very important elements of change that are already in progress in the organization pre go live.
So we expect to go live with our ERP landscape in the second quarter of, of 2021 and then have the full rollout in Belgium, around around summer completed. If we then look at the creative, also there are as mentioned, sheet number 22 we were able to speed up the integration process, one other thing that has changed is In the first instance, we kept the transportation capacity to ourselves. In the acquisition of the breakup because we believe that in the end, it would be good for fleet growth to have at least a portion of the transportation owned and not just, hired, with external partners. We still believe that is a good strategy, but not at this moment because hanging on to the equipment of, of the great transportation, would have meant significant CapEx. So we're placing roughly 50 trucks, this year, and it also involves 45 people that, of course, in these times, do not have a lot of work.
So we decided to transfer these employees to 2 of our transportation partners and at a later stage, we will see about, setting up our own transportation component. If that still suits our strategy. So we had a different point of view on this in relation to COVID. Well, on the Heineken partnership, I think I've already told quite a lot, on sheet 23 you can read some of the steps that we have taken and will be taken, into course of this year on sheet number 24 we see that, the rollout and the integration is done as planned, and also finalized So the last three elements are in the center of the Netherlands, in Vienna, and we are opening a new distribution center. And then we will have some optimization and we will transfer, our shield mover and account only facilities from, Denbos to, to New York High, which is also more or less in, in the center of the Netherlands.
And as explained, we will have, the great integration into our GreenOak Service in Amsterdam. These are still scheduled for the rest of the year, but all the Heineken distribution centers, as mentioned, with course, the last one was integrated. On C25, we can see the, the network development of sites As mentioned, we postponed the cash and carry refurbishment to the 3.00 in Hilton and Anen to next year, probably also, we will postpone that 1 year further. On the delivery service, we finalized Salt and LEAPAC, Nasif and Neder And we are in the final stages of, of finishing Vianan, which is already at least location, which we are now preparing for, to make it a delivery service of sleep grow. That's still to be planned.
And then the main, changes related to the Heineken integration, the CapEx program is is finalized. On the next sheets, we give some more insights on where we are with our cash and carry next generation project. Of course, ongoing trend in the market is that market is moving towards delivery and moving away from cash and carry. Of course, at some point, that will get to, to a halt, but we know that we have to take set up authentication garage doors to meet that new future. And it means, implementing areas of digitalization implementing areas of delivery from the cash and carry location, but also changing the setup and infrastructure in the number of square meters, product range, etcetera, etcetera.
And the whole of that is under the umbrella, next generation Cashing carry. Which you can see in the next couple of slides that, now we'll quickly run through them maybe on sheet number 28. Can see that how we are going to approach customers in true of the omnichannel setup, customer orders online or customer purchases in the outlet but it still means he can have different variations in either collect or get delivered from either of the the elements in the network. And that looks very promising. So on the next C29, you see that already in half the cash and carry outlets.
We have implemented delivery from cash and carry outlets, which is embraced by our customer So delivery on a structural basis is done by the delivery service. So every week in order or every week 2 deliveries or more that is done through the specific, delivery network, but we also have some customers that have, the bulk of their shopping in cash and carry but every 3, 4 weeks need a 1 off, big delivery. And we don't do that in the delivery service. We do that from the cash environment. And that's welcomed by our customers, warmly, and we see that this is developing in a positive way for Schneakers.
So we will keep on moving ahead in this direction. On the other hand, we see that we can be more optimal in promotions by the use of online, which would show the team number 30 and beyond. But I will continue of the timing to to your intelligence, which is presented each from Chief Number 37. I think similar patterns in the economic parameters consumer confidence down, unemployment. We don't have the figures yet of Q2, but it is to be expected that unemployment will go up in Belgium as well.
As a result of COVID and the post COVID, economic circumstances. In Belgium, we saw on sheet number 38 that in Java, which is care and cure segment, more health care related, the net sales, were not dropping to the extent as we saw on the Netherlands on the other end, on the cigarette IPC side, which is, of course, more hospitality and catering related that we saw big chunks of the turnover and diminishing. Of course, also fortunately, in Belgian, the recovery has started, in Belgian, the cash and carry area are open to the public, at least until September 1st. So a bit longer period than the Netherlands, and that helps in the recovery of the business in Belgium as well. On the next sheet, we see that we have done the signing update intent and, and Liaish.
So we didn't do the full makeover of the outlets to await, the SAP implementation first and then with the full remodeling of, of, Kent and Lias to, to the look and feel that we already have in Antwerp available we finalized the headquarters refurbishment in Oslo. And we decided to sell off our premises in Bridge, we were not confident that we would get a permit to establish a cash carry on those premises So we were able to sell it off at book value, and we will look for other opportunities going forward. And those are specifically mentioned at the bottom of the sheet, So in 2020, 2021, we will look for the delivery service outlets in the area of hand so that in the combination of the former Yaho warehouse in Ozawa and a new delivery set up in Ghent, we will, we will be able to cover most of the geography in Belgium, specifically for English. And on the other hand, we are looking for cash and carry environment is in the area of lows and Brussels in Belgium. And although we have insights, a lock on, on on CapEx, and we will make our choices very specific.
We know that growth in Belgium is essential to establish a profitable and a good position in Belgium. So we will be looking to expand the network if a good opportunity, good location, comes along. Then we have a few seats from the update on SAP, but I think in a more general sense. I've already explained the most important elements of it, including the last few pages from 43 onwards on the new online environment. So with this new online environment, on SAP, we are able to to have a faster, more customer friendly interaction, but also from a commercial perspective by integrating this Hydro website and the ordering sites into one portal we will have, a renewed force to, to help our customers and also to bank on the integration of Heineken in Seadrill as already planned.
On SEAT number 46, you can see the rollout that we planned for the rest of this year. And then by the end of the year, almost all customers of Slico and Heineken combined will be on the new platforms. Then the last sheet, I want to highlight is the outlook for this year, it's on sheet number 48 we think there will be continued pressure, although it is diminishing, as we speak, on the markets, Of course, we also have to take into account that there might be a second wave, but we do expect that the measures taken will not be as severe as the ones we've seen in the first half of the year, but of course, that has some uncertainty in it. On the other hand, we also know that after the COVID crisis, we will roll into a more of an economic downturn which of course will have its impact on consumer confidence and unemployment, which will also have an effect on our market. So That's why we also think that we'll take at least until the second half of twenty twenty one before we see a recovery of turnovers to the levels before, COVID we will adapt our organization in view of this.
So we will see where we can make the organization smaller. And more flexible, it also means that we continue in the tight cost control and targeted investment So keeping CapEx at the lowest possible level, but, invest in the opportunities we really believe in have also an impact for longer term profitability. Of course, you will also further look for integration opportunities of work done in the Netherlands and Belgium. And we already announced that by the end of last year, but in view of the reduced growth levels in Belgium, we would look for opportunities to combine Belgium and Netherlands activities on IT. This was already the intention on supply chain, we see more and more opportunities, but also on the level of purchasing and, a format management, we think we can do, we can do a lot more in a more Belgian, Netherlands approach instead of separated for Belgium and the Netherlands, which will have a cost benefit going forward.
If it is required to cope with another wave, then at least it's in place. If the other, if the second wave does not come, we will use this situation to recover faster and improve our position going forward. And, now we also expect with an increased volume to bank on, the Heineken integration and the delivery and new setup of the ordering website as we have, launched it recently. We won't make any forecast for the full year results, but in general, a few things to say about this. We have seen a recovery during the second quarter of the year.
We expect that will extend in the month of July. And then we will be at the level of roughly, we think, 80% of the levels we saw in 2019. So minus 20 We would think that will be the level for the third quarter of the year in terms of sales. And then we expect only limited improvement until the end of the year. So by the end of the year, we expect to be around, let's say, 85 between 85% 90% of 2019 levels.
And then we expect as for 2021, it will take until the end of the year, before we get back to 100. That doesn't necessarily mean that the market will go back to 100, but we do expect that as a result of the impact of COVID, which was severe for hydro, which is severe for hydro, but is also severe for all the other competitors in the market that in the course of next year, the competitive landscape will change significantly either by withdrawal or bankruptcies of number of competitors and maybe there might be acquisition opportunities. Anyhow, we think we can, benefit from further consolidation in the market, which for Seadrill means that we will have some recovery, out of those areas. As well in the course of 2021. That concludes my presentation.
And I would now like to give you the opportunity to ask any questions you may have. Please go ahead.
And the first question is from Mr. David Thomas, GED. Go ahead, please, sir.
Thank you very much and good afternoon. Some questions on your, on your statements you just made. Could you comment perhaps on, how trading conditions in June July so far compared to your, to your, initial estimates, your forecast? Second question is then, if I'm not mistaken, you, earlier on, say, a couple of months ago, you said intended to raise prices in 2020, partly because of, cost inflation. Did you already succeed at increasing prices?
If so, could you please share some some of your experiences on that? And, third question is, do you considering also the the dual height trends in hospitality, which was improving. But do do you have any updated thoughts on the the hospitality industry being permanently weakened, or do you, consider chances to be to have, diminished? Thank you.
Okay. Thank you. Well, I can, on the first question is, so how does the trends relate to our initial estimates Of course, we have been adjusting and readjusting our estimates, month after month. But, if we look at what, what we thought would happen, in the second part of March, early April period, then the recovery as we see it in June July is faster than we expected. So we saw a more gradual improvement, from the mine 55, step wise to, to more increased levels in the end of the year.
And we see that with the relief of the measures, by the government, that the impact is bigger and more positive in June July. So that is at least a promising how Then on raising prices, if I recall, correctly, we specifically mentioned that, of course, we see that in the supply chain, as a result of shortage and, of course, increased ask for certain specific products and, like, gloves, cleaning materials, etcetera, etcetera, that our suppliers are also increasing prices, and we make the choice that we follow those prices and then increase. We did not, implement, put forward a general price increase overall. So on those elements, and specifically, of course, product sourced from Asia, which were, limited available or specific product groups, where I've seen non cost price increases that we followed, but we did not do a, a, in general, overall price increase. And then your third question, yeah, we see that the hospitality sector is is improving significantly.
So from minus 90%, at start of the COVID measures. It's now, we can get around the level of minus 10, which is promising. But of course, we see that the big shakeout is going on amongst, our customers. So a number of outlets is not able to cope with the COVID crisis others are. In the end, it's all about the volume that consumers are willing to spend in the out of home market So, that is much more determining how that will work out for seed growth.
Because in the end, of course, with our market share, if one outlet stops, then the volume will move to another. But there, of course, a recession scenario and pressure on the overall market course, we'll still have some impact. So we do think that in the next couple of years, the next 12 to 18 months yeah, there will still be some impact of, of of a recession following COVID, on on this part of the market. For us, the main market to watch in that respect is the catering market and especially the business catering market, because there, of course, we see that, there's no, big recovery yet in that segment, which is also a big segment for us. Because many people are working from home and not in the offices.
So, also not enjoying lunch, in the offices. And, yeah, we don't know how behavior will change, going forward and how sustainable the the the the working from home will be and what the impact eventually will be on the catering market. So that's still one to watch. Which has some uncertainty in it for us. I think I covered your questions with that.
The next question is from Mr. Halm Lohasek, ING. Go ahead please.
But, thank you for taking my question. I have a a question regarding the recovery in Belgium versus Netherlands as a joint budget has been this, difference in both countries, are there the differences you're noticing, on in both markets and in one? And secondly, also I would like to know how are you able to improve your position in the market due to COVID nineteen? On the Belgian markets? Thank you.
Well, we, to start with the first question, I think, for large, if we look at that big chunks, the development in the markets in Netherlands and Belgium has been more or less similar. But of course, in the Netherlands, we are already in all geographies in the Netherlands present and in a wide variety of customer segments. So that we see a more even dip, but also more even recovery. In Belgium, of course, the big chunk of the turnovers to 50 half more or less is Yava. Yava is more for the institutional market.
So there we saw less of a decline, in sligo IPC. Yes. So and we're and, hence, and the ASH, we saw a bigger decline and now also a slow recovery. The measures in place by both the Dutch and Belgian government, more or less have similar types of effects. We do see, however, that in Belgium, we, have an an an, a big chunk of our business in some of the big cities in Belgium, which also depend significantly on tourism, which is really low at this moment.
So if we look at it today, we see that recovery in Belgium is bit slower than it is in the Netherlands as we see it. If we then look at a competitive landscape in Belgium, we see there's a, a, still a big variety in players, only a few bigger players And we see that the impact on Figuero is, of course, severe, also on Figuero in Belgium. The impact is severe. But of course, sligro in Belgium can benefit from the strength of the group in that sense and will survive and will stay afloat. Which I doubt will be the case for all of the competitors in the market.
So we anticipate that not only among our customer base, we will see a shakeout, but, well, this, this COVID crisis and the, the, the economic downturn following this crisis will, in our view, cause also a, a safeguard on the supplier side. Which is then a potential opportunity for us to pick up the business and strengthen our position in Belgium. Ladies
and gentlemen, is there any additional questions? Please press star 1. And there's another question from Mister David Police. Go ahead, please, sir.
Yes. Yes. Thank you, operator. One question on the on the refinancing or actually two or three questions maybe. In today's results presentation, you mentioned, that we'll do the temporary, new covenant level within the for your net debt ratio, 4 instead 3 previously.
You didn't earlier you previously didn't disclose that in the press release of July 1st where you, published the, the new financing agreement. What is this adjusted ratio, the only change in the covenants or have there been any other changes in conditions that have been agreed upon? And the second question related to this refinancing is, the stretch ratio, just to be sure on that, the stretch ratio of 4, was that only in place for the half year covenant test, and we'll see how, therefore, have to comply at year end to a ratio of 3 Thank you.
Yes. So, your first question is, so indeed, it was a temporary increase, for the 36 period. And that had a lot to do with the effect that, of course, for many of the use would be note holders repayment is scheduled for December this year, which means that their horizon does not go beyond 3112. For, you are correct that for the remaining use for keyholder that we have, the covenant is still at 3.0. So by the end of the year, under the current circumstances, we have to comply with 3 year.00.
In our current outlook, we expect to be able to do so. But still, we wanna, continue the discussions with, with this partner also with our banks. To, to make sure that if something would happen in the second half of the year, unexpected that we could cope with that. And that's why we will have ongoing discussions in the second half of the year. With the banks, it is already, agreed that we can go up to 3a half, going forward.
So that is, increased from 3 to 3a half. But with the USB financing, and of course, the lowest, is the most important one, because that's essentially where you measure yourself against that is still at 3.00 at 31.12. So that's something that we still have to have to discuss about. You asked about other specific conditions. Well, I think we mentioned that, before paying the dividend to to the shareholders, or making huge investment decisions, then, the USDP holders in the 2010 deal would ask for, a repayment of their position first.
So these were taken into account for the rest. There were no specific other limitations entered into the contract. And let's see. I think I've done answered most of your questions.
No further questions at the moment.
Okay. Then I would like to, thank you all for joining in on this, on this call. On October 22nd, and then, a previous version of the press release it was stated October 23rd on Friday, but it should be October 22nd on Thursday. Then we will publish our Q3 training update, with more news on the development of our, of our sales in, in the third quarter. So for now, thank you all.
Enjoy your holidays for those who still have to, have to do that, and hope to, to hear from you again. Thank you.
Thank you for attending. You may now disconnect the line. Have a nice day.