Welcome, ladies and gentlemen, to the Earnings Call of CEWE Group, following the Publication of the First Half-Year Figures of 2026. I would like to welcome CEO Thomas Mehls and CFO Sirka Hintze, who will speak in a moment and guide us through the figures. Before I hand over to the management board, please note that you have the option of switching your camera on and off. In this case, you will be visible during the entire presentation, but not on the recording. The recording will be stopped before the Q&A session. Having said this, Mr. Mehls, the stage is yours.
Yes. A wonderful and very warm welcome and a very good morning to all of you.
Yeah, also from my side, very warm welcome.
Yes, it's a beautiful day in Oldenburg. The heat is not yet up, so I'm sure we will look into a very beautiful summer day today. You know summer is an important time for our clients to take a lot of pictures, and I hope either you had your holidays already and took a lot of pictures and are in the phase of preparing your personal photo product, or you will be still going on holiday and do so. We have a very good call this morning, so we are proud to announce very good figures for the first half year. The Q2 was a really strong Q2, and also we would like, obviously, to reiterate our very beautiful story of the acquisition we did announce actually during my holidays. I know some of you have been on this call, but not all of you.
So, of course, we will reflect on this acquisition, which we announced in July, where we had this signing. I would say a call with good news for today, and let's start. Let's start with the latest news, which are, of course, no news anymore. But it is important to reflect a little bit to give you, again, our view on why we did so, what is going to happen, what is the outlook for the Kodak Moments acquisition. We acquired the Kodak Alaris, and I will come to that one. It sounds all a bit complicated, but in fact it is very easy. The global instant photo business of Kodak Alaris, which is called Kodak Moments, and which is important, it is a very strong brand, and it is something which will strengthen our brand portfolio here.
So, you know us, we are not only the CEWE brand, we are a so-called house of brands. We are managing a diverse portfolio of brands, may be Pixum, may be WhiteWall, and we will add a really strong and international, and we can say global, a really global brand to our brand portfolio, which of course is based on the iconic Kodak brand. You all will know it. It is a brand which emerged in the film business, which is still very strong. Of course, it had its challenges. But I will show you the Kodak Moments brand is a fresh brand. It is a strong brand, especially in the U.S. It is a young brand also.
Kodak Moments, if you happen to look it up in a dictionary, it is something which found its way into dictionaries, and it is defined as something which is really a moment which is a treasurable moment and which was really this brand was loaded by social media in the past 10 years, especially in the U.S. So, what is Kodak Moments doing? It is very similar to what we call our on-site finishing business. If you happen to live in Germany and you walk into a dm drugstore, for example, you might find our red CEWE Photostations. Or if you happen to live in the U.K. and you walk into a Boots store, you will find our CEWE Photostations. Or if you happen to live in the Netherlands and you walk into a Kruidvat store, you will find them.
If you happen to live in France and you walk into an E.Leclerc, you will find the CEWE Photostations there where you can print on-site. This is why we call it on-site finishing, where you can print on-site your pictures. This is a very similar business, so they provide the hardware, you can see this in the upper right corner, into retail locations. Obviously, they provide the software for this hardware. Obviously, they are products which consumers actually can print on with different designs and forms and shapes and whatnot. But, and I will come to that in a little bit, Kodak Moments also produces the, as we call it is quite a technical term, the consumables.
The media kits which go into this hardware because, if you want to print something, there must be something inside, and I will come to this in a little bit. They have the strong advantage, and this is one of the strategic originals, the strong advantage of having a production facility producing these consumables. You see here for the first time, I would say for the first time in one of our analyst call, actually, we are showing the globe. We are not showing Europe, and I will come to that in a minute. We are showing really the globe because Kodak Moments is serving retailers around the globe, and not only some retailers. Really strong retailers, and you know if you have been to the U.S., and I am sure you have been to the U.S., you know CVS, you know Walmart.
Latin America, Farmacias is one of the strongest drug stores chains in Mexico, Kmart in Australia. Maybe your summer holidays took you to Disneyland Paris, could be, or will take you to Disneyland Paris. Kodak Moments is also very active in amusement parks. Disneyland is a very good example for that one. If you are on the roller coasters, and this is really, I would say, top-notch technology, which is built into Disneyland Paris. You can imagine at the right moment in a rollercoaster, pictures have to be taken. You can see them on screens, you can buy them as a digital product, you can buy them as a printed product. They are also in locations like that. Talking about technology, with this deal, we also bought about 400 patents in the sphere of on-site finishing here. Also very interesting.
Patents are important in today's world, so we also acquired about 400 patents. If I say we did acquire, we have to be sure we will acquire, because yes, we signed the deal, but the closing is not yet done. We will come to that in a minute. Forgive me for this one. Kodak Moments in a more, let us say, fact-based sheet here. What is that company about? It is about EUR 200 million of turnover. We will have 500 new colleagues joining the CEWE Group, including some in the production. I will come to that one in a minute. They are serving about 16,000 points of sales directly, with 37,000 connected CEWE Photostations. We have about 25,000. They serve also a lot more, which are not connected, but that is a different business. They do about 1.5 billion prints annually.
We do in our on-site finishing about 400 million, just to give you a little bit of order of magnitude here. As said, they have a production site in Windsor, Colorado. The main office of Kodak Moments, where most people are being employed, is in Rochester, which is upstate New York. I would say closer to Toronto than to New York City. Again, this is the map. We would have focused a bit more and just showed you the European map, but that is the map you have been used to. This is where the CEWE Group is being present. We are present in most European markets. You know we are the European market leader, and now we will add the global scope of the network of Kodak Moments.
CEWE, your company, well, if you are an investor, and if you are not yet and want to become one, your company will become a real global company, with activities around the globe. The main ones, the key markets there are the U.S., Mexico, Canada, and Australia. This is where most of the revenue outside of Europe, because they are active in Europe as well, outside of Europe is taking place. We are adding really new key markets. Well, I told you what they are doing. It is a brand which connects with consumers at the point of sale. This is something which always made CEWE very special. We talked a lot in these calls about omni, I think it is omni-channel, here, which we are driving. This, of course, strengthened and will strengthen our omni-channel position around the world. It is something which made this company always special.
This is how we grew the business, and this is how we will be growing the business as well. Retail has been important and is still very important for CEWE, which is very different to some of the competitors, which limits them in their growth as well. I told you, and this is nice, these are our photo finishing brands, and now we will add Kodak Moments to that one. We made it a bit bigger and put it more into the center because this is the news, obviously, here. I talked to you about the production. What is production? What does production mean? If we talk about Kodak Moments, it is about, and this is the subline, you see it here on the side, on the sign, the thermal media manufacturing. This is a photo actually in Colorado. This is how it looks.
A bit dry. We know that now in Germany and in Europe it is a bit dry as well here. It is a bit dry. There is not a lot around. It is close to Denver, Colorado, on the footsteps of the Rocky Mountains. Rocky Mountains are quite nice, but down there, pretty dry and, well, a lot of flat land where not a lot is happening, actually. Why thermal media? That is the technique that most CEWE Photostations around the world use in order to print on paper. There is not an inkjet printer or laser printer in there. It is a thermal media. That means there is a so-called ribbon which connects with the paper, and the ribbon brings basically the color of the picture onto the paper. This is a thermal process, which takes place within the CEWE Photostation.
Of course, this material must be produced. This is a photo from the manufacturing site in Windsor, in Colorado, on the so-called wet end. This is a gravure printing machine. It is a huge machine, a lot larger, a lot different to what we used to have here. It is about, I do not know, about 50 m long, if I would guess, and about, I do not know, 8 m high. It is a monster, I would say, with large cylinders. There they print on these ribbons. It is a very thin, I do not know, it is about a tenth of a millimeter. It is a very thin foil, which will then connect with the paper. This is the process which takes place here in the so-called wet end. Then there is a dry end.
Dry means there is no printing, no chemicals involved, where those so-called media kits, which at the end go inside the CEWE Photostations, are being produced. We also at CEWE have these media kits. We have them as well. As of now, we buy them. We buy them from different suppliers. They are all from Asia. We have had challenges also in securing our supply chain. You might remember the crisis we had in the Suez Canal and so on. We had quite huge dependencies. With this step, it is actually a vertical integration, what we are doing, and we make ourselves a bit more independent from these suppliers, which is an important part of the strategic rationale we are doing here. What is happening, and this is what makes this deal a little bit more complicated than just a normal acquisition, it is a carve-out.
There is a company called Kodak Alaris. This Kodak Alaris company actually emerged when Eastman Kodak went bankrupt in 2012, and this company was spun-off. In this company, there are basically two main business units, and in one, there are also two main business fields. So two main business units. One is Alaris. They call it mostly Alaris, not Kodak Alaris anymore. It is a B2B field where they produce scanners. Actually they produce the machine, the hardware, the scanners, on four companies, which have a huge demand of scanning documents, libraries, and things like that. So a totally different business, nothing we are in, and we do not want to be in there, to be quite honest. In the Kodak Moments business unit, they have the Kodak Moments brands, which is this retail photo solution. I talked about this one the last couple of minutes.
Then there is the film, actually distribution analog 35 mm film for cameras, which carries the Kodak Professional brand. We will be carving out this retail photo solution business out of Kodak Alaris. We will take the Kodak Moments brand out of Kodak Alaris. It is a perpetual recurring license from Eastman Kodak, so we do not buy this brand, but it is irrevocable, so it is forever. So forever we are allowed to use and work with this brand. This is the transaction scope, and it does make also for finance this transaction a little bit more complex than others, right?
Yes, absolutely.
Couple of key facts again. I talked about the carve-out here. It is part of Kodak Alaris, and of course, this closing is subject to regulatory approvals. We expect completion, and there are a couple of more closing conditions, as you can imagine in this deal than just regulatory things. The carve-out has to be managed, so within 6- 12 months. That is fair to say. We have transaction pre-closing cost. You saw that in the announcement of our figures. That is part of the deal. Nothing special about it. It is well calculated in our ROI calculations, so nothing to worry about. You need to hire a couple of lawyers. You need to hire a couple of people which do due diligence. We do not want to run, and you do not want us to run blind into such an acquisition.
We need a good contract. We need a good due diligence, and obviously, there is some costs associated with that one. The purchase price, we communicated that, so the enterprise value is about EUR 88 million, and then, of course, there is an equity, there is a bridge then, and we assume that there will be a cash out of about a little bit more than EUR 70 million, depending on the final bridge there. Profitability, yes, this currently, because it is something which was owned by private equity for a long time. They have not invested. They have not really been growing. They have not acquired new retail partners. New retail partners use a little bit of an investment there. We will start with a single-digit profitability. It is a profitable business.
We did not acquire anything which is distressed or something like this, but it is something which will get a lot more profitable under our hood. This is important to note here. Strategic rationale, and I think I reflected a little bit already in my speech here. It is really the combining strength of two strong brands. CEWE is very strong in Europe, and to be quite honest, non-existing outside Europe. Kodak Moments is very strong outside Europe. It is something we see the opportunity, and our instant photo business is growing, and we will be having a stronger growth right here, and obviously also adding more geographies brings growth to us, but we will be growing the Kodak Moments business. It is not about acquiring a stable business, it is about acquiring a growth platform here. This is the second point here.
We want to scale the business geographically, adding more retailers. We have a huge chance for adding a real growth engine to the CEWE business. It is a very high strategic fit. If we talk about strategic fit, we also have to talk about people. I realize I did not talk about people, but that is also very important. If we do an acquisition, we look really closely to the people. Will those people fit our culture? Can we build a combined company here, which is based on the same values? We found very passionate people, very enthusiastic people about photo, very enthusiastic people about us acquiring that business, very enthusiastic about that. Quality-driven people. This is really a great bunch of people which will be joining the CEWE Group. We are very proud, and that was important for us as well.
We can talk about revenue, we can talk about profitability, we can talk about strategy, but to have the right people on board is really important, and we have the feeling that this group of people fits perfectly to our group of people here. Again, omni-channel is a very important point. We have been driving forward this omni-channel approach. If you look at what we do with our retailers here, we see a lot of chances to add exactly the same notion to Kodak Moments. Again, part of the growth story here. We believe in retail. We see it every day what is happening here. It is the entry point for many people connecting with our brands. I just invite you to go into these retailers, look into the retailers, and see what especially young people are doing.
Gen Z, this is the target group of on-site printing. If you go into any dm around noontime, you see a lot of people after school, young girls especially, looking at beauty products and printing pictures. This is a really highly attractive target group, which we will be adding, actually. We are addressing the target group with CEWE, but adding geographically here with this acquisition. I talked about the international expansion. New core markets are being added to our portfolio. First, the U.S., Canada, Mexico, and Australia. Really strong markets, and we see a lot of potential for growth, especially in these markets. May there be even more growth options. You have been seeing that there is India on the map, there is China on the map. Looking at the current revenues, which Kodak Moments does in these markets, this is currently rather small.
There might be even more potential there, but this is not factored into our thoughts as of now. But we might be looking in, I don't know, one-three years into that as well and see if there is more potential there. I talked about the vertical integration. It is more control, it is value creation, it is securing the supply chain. A very important step here for us to be more vertically integrated in this important business field. What is going to happen. Signing, it is not today. It was back about, what, three weeks ago, something this. We did the signing. Obviously, we are in the preparation now for closing. They are in the preparation for closing. We are really on full throttle here.
There are a lot of things which needs to be done, but obviously, we have a high interest to shorten this period of time as much as possible. They have a high interest in shorten that one. I can't tell you. There are so many dependency on there, but we expect about 6- 12 months to closing. Then it is about integration and growing the business. Really, this is a growth case which we acquired. This is a growth case which adds profits already, and will be adding profitability as well. There are a lot of scaling options in there, so we are very strong about this one. This case changes the CEWE Group dramatically for the better. Really, for the better. Yeah, isn't that nice. It is about Kodak Moments.
The CEWE brand is about joy, and we thought, isn't that nice that we can create moments of joy together now? This is what it's all about. These two brands, really, and these two businesses fit very well together. Going a little bit more into the strategic perspective here. We also completed our sale of the commercial online print. To be quite frank, this is also only a couple of weeks ago. It's not like half a year or a year or two years ago. This is just a couple of weeks ago. We changed the scope of the strategy. Not the strategy, because we talked to you. The two of us talked to you about a year now about what we are going to do with CEWE.
We told you we're going to focus on photo finishing, and obviously to focus on something means where you don't focus, where you maybe defocus in some ways. It's always easier to say what you want to do, but if you say what you want to do, you also need to say what you don't want to do anymore. This is what we did. We did a very nice transaction on the commercial online print division. We have been seeing some cost in H1 2026 here, and you will see that in Sirka's presentation. There will be a strong benefit coming up in the second half of the year in Q3.
The closing has been done beginning of July, and obviously we expect a pretty high nice effect, we will come back to that one, which you can see and will be seeing in our Q3 figures. This was strategically very well for the CEWE Group, but it was also operational as a deal, was a very good deal for the CEWE Group. This, for us, it's almost forgotten, Sirka, a little bit, but it's the first time in our analyst call that we can actually talk about the closing being done here, and this has a high impact, but it's something very consistent to the strategic rationale which we have been talking to you for the past 12 months. We sold that. It's closed. It says here, yeah, completed effective July 2nd. We are a photo finishing company. We are a brand company.
We are a house of brands focusing on photo finishing, and now we are global. Yeah, the sale, it says here, also improved CEWE's financial figures. You can say that we talked to you about that one. Now combining all these things together, I think you will be looking at a very strong growth engine within the CEWE company. Now let's look a little bit to our results.
Okay. With this being said, you probably might remember all the strategic discussions and information we gave to you. Coming now back to our results here to the existing business, we completed first steps, but also you can see here that we showed the numbers with numbers of our commercial online printing and excluding. Under accounting ruling, we are going ahead with a reclassification under IFRS 5 and take certain effects already out. On the other hand, the cash came only in on July 2nd, so after finishing the first half year. That is why Thomas mentioned that the effect will, from a profitability point of view, only be seen if we finish the consolidation by the third quarter. What can we conclude of our business of the Q2?
We can see here a significant growth in our revenues, which is, I would say, especially under these circumstances, that the German market is very difficult for a lot of e-commerce business, but we still see with this as a core market, we can also see here, compared to the previous year, a significant growth of 6%, excluding our commercial online business. The EBIT is, from an operational perspective, comparable to what we have seen in the previous quarters, which is typical for our season. A good and solid result on the one hand. On the other hand, we, of course, due to our activities of the first half year, I would say, we spent some money for getting our strategic direction implemented, and this is not for free, of course. The transaction costs, you can see here, will be loaded on our P&L as well.
We have to show also these effects, but still, at a later stage, you will see that we stay with our predictions and plans. We do not take these things away, but we come later to that. The group EBIT for Q2, solid operational was EUR 3 million, and then corrected by transaction costs for the sale, and of course, also the transaction costs that we had to anticipate for getting the signing of our acquisition of Stardust. A proportion of that amount will be compensated by the seller at a later stage. But still we had to reflect this. That is why we have a reported EBIT of the Q2 of EUR -7.4 million. Having the look on our first half year, in addition to all the activities we had, we can see a strong operational first half year.
The first quarter was a bit tougher than the second one. If you would ask our people, they would say, "No, it was the other way around," because we had really a lot of things here to prepare and get under control, I must say. Operational-wise, we are really satisfied, and also from a result point of view, we are not unhappy with our profitability, which is, of course, under, and we shared it over the last months also, market-wise, cost-wise, it is something where we have to be very focused and concentrated on steering all our activities with higher logistic costs, higher material costs. All this is also falling into our field, so we have really to manage these circumstances.
We promised, and I mentioned it in the beginning, as long as you talk at least also to me on these investors conferences, we were sharing that we are focusing on our photofinishing business. I guess we not only took ourself in the management from a management perspective, a favor also for the team at our commercial online printing business. They have now, I guess, a harbor where they can also develop and a flourishing business in a way that they have their hometown found with Cimpress. That is why we can now focus on our photo finishing business, which will be strengthened by the addition of Kodak Moments.
We will have furthermore insights of that in the future while we are preparing the closing, and then later the integration and really implementing the growth. I guess also for the people at Kodak Moments, it is maybe also a good move because we have a heart for pictures and photos. Operating performance, as I said, the turnover continued more than expected, and the result is on a typical seasonal level. That is why we stay with the guidance for this quarter. Especially also the expected turnover growth.
We will, of course, have a closer look at the third quarter. It is expected to stay at the line what we have communicated. EUR 782 million-EUR 810 million and the EBIT will stay in the range as what we have communicated. Let us talk a little bit more about photo finishing. I am happy to announce that, again, we have kicked off our international CEWE Photo Award, which is the biggest on Earth. This year we have decided to donate EUR 0.10 to UNICEF, and so we are happy and very curious to what will achieve our, I would say our, how you say the, special, our-
The amounts of pictures uploaded?
The pictures and what we will see there. Pretty nice and we are very curious. Then also, we are proudly present our new product, which was the winner of our internal Innovation Days. It is developed together with Swarovski, and it shows here in the video, you can see that a lot of Swarovski crystals are at the surface of a picture and creates a very sparkling moment if you look at the picture. It was, as I said, the winner of our innovational process. The wall art will be presented in 200 selected, especially bigger stores of Swarovski. It also creates, of course, a higher visibility of our product. Coming back from this sparkling moment, coming back to the business segment, photo finishing itself, and here it is underlining what I have said before.
7.5% increase in turnover alone in Q2. Usually that period is for taking pictures, and obviously, our customers were already on the way of creating photo books. You can see also here an increase of sold photo books by 1.5%, and also with a turnover increase of 3%, and also the turnover per photo, we will see it later, continued. We are very happy to see this. We always have in mind what is coming up with the season, and if we have a good and strong year, we are happy and looking forward for the season because usually this trend is not really changing. Looking at the EBIT, I explained a little bit, EUR 1.7 million, EUR 2 million, the transaction costs for our acquisition. But overall, the operational result stays comparable to last year.
The seasonality of our business is significant, and this is a very typical second quarter for us. Here it comes to a conclusion of the first half year. As we have a weaker first quarter, you can see the turnover growth of 4.5%. All in all, it is not changing the overall picture, and it sums up what was said before. Photo finishing turnover per quarter, here you can see also visualized what I have said before, a good growth in the turnover following the trend. We are happy to see that the growth is steadily going absolutely in the right direction and is a little bit in the second quarter above the target range. EBIT wise, also for us from an operational perspective, no surprise. Completely within the range and our expectations.
The number of prints and the turnover created by the photo finishing, you can see here also that we were over what we had planned. The increase, you can see here, what is driving the turnover in photo finishing is not only the number, but also the value of the photos, which is following to what we have seen, especially in the second half of last year. Very good. Summarizing here and aligning the number of total prints increasing, and also the value. Here, you can also see a little bit the impact of the first quarter. 4.5%, which we are happy about. Number of photo books, which is our core product, and especially we are happy about that the higher value of the photo books continues to increase.
That is especially from our discussions, that we are having a high focus in making our photo books more attractive to customers, creating new features within the photo book, increasing the premiumization of the products. This is now also a good reflection here in the numbers, here summarized for the first half year. Last time in our presentation, we will start. Yes, last time.
The very last time, yeah.
We are going ahead and report a little bit about our commercial online print. We always communicated the challenges of that business unit, which is driven by the overall market decline and also where our, I would say, manufacturing power or technique and the qualification of our people obviously make a good success out of it. This is still what we see in the first half year combined, so that the EBIT is on a level where not really something is really earned, but it is also from a turnover-wise, the loss of business is not significant. So they stay with the amount of business, which is already, I would say, an outstanding performance of team and technique in these declining markets.
We wish and hope that for the second half year of that business, so that they keep going, and also can take some positive effects out of the acquisitions interested. Retail. You probably had a little bit of question mark, because also Thomas mentioned, so we are focusing also on retail business. So we are investing, we are developing our stores, and we also took the decision to have the product portfolio in these stores more focused on higher margin photo products, like frames or photo albums, which are closer to our core business. Also because of the, we call it hard hardware, the expensive cameras, where we cannot compete with other suppliers like the Amazons and other specific suppliers for that. So we are reducing by that decision, focusing on a different product range. We are reducing a little bit the turnover.
From an EBIT perspective, if you go on the next page, for the first half year, you can see it is not so bad, and we are heading towards the break even, and hope that this decision for it is really the retail business, and so that we are developing it from a margin perspective in the right direction. It is like our other segment. It is very small. It is just that have also a segment where we can put what is not really directly connected to our business. You can see here, we had a little bit higher profitability because of the improvement in the earnings coming out of the property lettings. Nothing more to be said on that. That leads me to the financial details. Having a view on the P&L year for the Q2. It is showing or translating what we have said before into numbers.
The increase of revenue you can see, but also you can see, of course here, the group wide view on our cost impacts. You have seen EUR 3 million more material costs. You have seen the transaction costs, and also we have hired a little bit more people for the photo finishing business, so also the increase of personal costs you can see here. We come later a little bit more to the effects on our cash flow. We have not only acquired something, we have not only sold something, we have also implemented S/4HANA. It was, as you maybe all know, the last month before you go live, and we had a big bang implementation. We went live with all our businesses in all the countries at the same day. We got prepared for that.
With the cut-over planning and the migration, so also from an operational point of view, we had a little bit to fill our storages and making sure that we are, from an operational point of view, are prepared for that. I can tell you we had a very smooth go live, and so we were all the time very curious to see what is going to happen, but not really big things happened, so all was fine. All our plans went in the right direction. The operational expenses are mainly driven by the advisory costs here and higher IT expenses, of course. Also, we took a bit more speed on getting the things done for the S/4HANA implementation on the last mile. This is, of course, also reflected in the cost basis.
If you have a look into our balance sheets, you can see that we have obviously something going on on our asset basis. You remember that in the first quarter, we bought properties in U.K. and in Germany, and on the other hand, we sold the business and also the facility at our SAXOPRINT in Dresden. Then we did the reclassification under IFRS 5 because then you hold the assets for short-term basis, and that is why you can see here the jump in the current assets compared to previous year. That is reflected here. All in all, the relations within the balance sheet are changing. On the liability side, you can see that the retained earnings and the balance sheet result of also the dividend payouts, so also the shares we bought back.
The effects you can see, all in all, the balance sheet sum stays at the same level, whereas the equity ratio is increasing now to 71.2%. As I said, the free cash flow is reduced towards minus EUR 18.3 million. This is mainly driven due to the working capital effects we had and payouts, also to get prepared for paying earlier. The accounts payables were paid with a higher speed to not having an unfortunate situation with suppliers, of course, but also for getting our things into storage to be prepared for any delays just in case we are not ready with our new accounting system here. That is why, all in all, the cash flow from the operating activities look a bit different.
Also, we prepared you already in our last call that this is something what was planned, so no surprise for us. The cash flow from investing activities decreased by nearly EUR 2 million and is mainly reflected by lower capital expenditures on property plant and equipment. All in all then, the free cash flow is shrinking further. The return on capital employed last time diluted, and it still remains on a solid level at 16.5%. These figures will be changed in the next upcoming times, I would say.
Yes. Thank you very much, Sirka, for the quick run through our figures, and let us sum it up a little bit. We did dispose our commercial online print activities. We did acquire Kodak Moments, and we launched S/4HANA. All of that was happening in Q2. As you said, it was a stressful Q2 for many of our people here, but we delivered good results, operational as well, which is very important here. Yes, you did see some effects on the balance sheet, on the cash flow activities, also due to the S/4HANA launch. Nothing to worry about. We are very confident about what we have seen in Q2, and I will tell you, we are confirming our outlook going forward as well.
To be honest, this story which we have here, and many of you have followed us through many of these years, this will look even stronger if we are able then to really add the Kodak Moments business to that one. Usually, we do not believe in hockey sticks, but it will have the form of a hockey stick a little bit if we add this EUR 200 million turnover here after closing. Our story continues, and this very clearly our story will accelerate. With this acquisition, our story will accelerate. I think here, if we go on the next slide as well, you do not even notice the disposal of the commercial online print activities, but I can tell you in a positive way, you will notice our acquisition of Kodak Moments on the revenue side as well as on the profit side.
We are confirming our 2026 outlook as of now. This includes also, well, that was too quick, I thought. That was too quick. This includes also our targets in photos, in CEWE PHOTOBOOK, in operational investments, and so on. We are strong about this business. We are strong about the acquisition. We are strong about CEWE, I think that's fair to say here. Just to remember if some of you might have forgotten, and this was something we were hinting to, this is something we will post in Q3. Obviously, we will deconsolidate. I think that's the right technical term here. We will deconsolidate the commercial online print segment. You know that we did have, the cash is already here, but you didn't see that on the free cash flow because it did arrive in July.
As we said, there was the closing in July, and you will see the effect of the deconsolidation. It will be quite strong. We did communicate openly about this one, and this is something you can be looking forward to in Q3. I think that's fair to say. This being said, happy customers. I think we can stay a little bit on this chart here, and you can say, well, this is just the chart. No. This is, in a nutshell, in a picture, our strategy. Because everything we do here now at CEWE, in Oldenburg, in all of our countries, is geared towards end customers. That was not the case with commercial online print. The whole company now is behind this picture. Before, our commercial online printing colleagues said, "Well, our customers are, I don't know, buying centers at larger corporations," for example, and so on.
This is really what drives us. If you had a look into our offices, you would see in some of the hallways already we've put up Christmas trees. Yes, you can say we are nuts, and of course we are nuts, but with 35 degrees, tomorrow it's forecasted to be 35 degrees here in Oldenburg, our people have to prepare Christmas campaigns, and we need. Coming back from holidays, the school holidays, today is the first day without school holidays in Lower Saxony here. Those people have to prepare the Christmas campaigns, and we have to get them somehow in the mood. One of these small little details, we are putting up Christmas trees so that these consumers and these customers will be happy and looking at their individualized photo products underneath the Christmas tree.
Thank you very much for your attention, and we are looking forward to your questions.