Good morning, everybody. Here from Sevenum, and a very warm welcome to our Q3 earnings call. Today, we will take you through three parts: an introduction from me, a business update, and then Hendrik will walk you through the financial update in detail. We will leave plenty of time at the end for Q&A. Let me introduce myself briefly. You will find the key steps of my career on the left-hand side, so I will not walk you through my CV. What you see already, immediately it is obvious, I am not a pharmacist, and I do not come from the pharmaceutical industry. Although my first role at Procter & Gamble 30 years ago in Frankfurt, I was responsible for pharmaceutical business of Vicks cough and cold products and Chlorhexamed. At that time, I saw already 30, 40 pharmacies from inside and did events together with pharmacists.
For more than 25 years then, I have built, managed, scaled e-commerce companies, and each changed its market. AutoScout24, for example, changed how people buy cars. At the beginning, nobody searched on the internet. Today, probably 98% are looking for a car online. eBay brought the secondhand market online. With Parship, we really changed how people find a partner for their life. Finally, Visable. With Visable, we moved B2B trade from in-person affairs to online marketplaces. What they had in common as a key success, scaling, strong teams on the one hand, a clear customer focus, and technology. All things which also apply here at Redcare. Now I became CEO of Redcare two weeks ago, or two and a half weeks ago, on 14th of October, after being a member of its supervisory board since April this year.
You might ask, "Why did he join Redcare?" For me, very clear, there are three main reasons. There are many reasons, but three main reasons. Our purpose of improving people's health. That is amazing. It energized me since I am a supervisory board member, and now even more as a CEO. Second, the market we are in. It is a large market, a growing market for us, and I am very enthusiastic about the chance to be a driver of the digitalization of healthcare. I am always saying we are just at the beginning. It sounds strange, 25 years in the market, but it is just beginning, this era, and I am very happy to be one of the driver in this industry now. Third, our strong position. Redcare has a strong market position, and out of this position, we have several growth opportunities resulting out of this position.
What did I find when I arrived here two and a half weeks ago? It is a great foundation, I found. Redcare is a real online pharmacy at its core. With 25 years of experience, we have a high professional teams, great pharmacists, and impressive logistics. Second, amazing customers. Our customers really love us. An NPS of 75 and sometimes more is an amazing number I have not seen so often since I am in the digital industry. Number three, we have 15 million active customers. That is something you will hear in a minute more detailed, but we surpassed this number of 15 million active customers. With that, we are in a leading position in five out of seven countries we are in, and this gives us multiple growth opportunities. With that foundation, now we scale. First, we will improve execution and achieve excellence in e-commerce basics.
Second, we will use technology and AI for better customer experience and lower cost. Third, we will focus on our key growth levers. Last but not least, growth alone is not enough. We want to grow profitably, backed by operating leverage and a very disciplined cost base. What can you expect from me for the next months? First of all, I will listen. I will listen and learn from all stakeholders, especially our customers, suppliers, from our employees, from the insurers, associations, and others to understand what works well and where can we get better. Second, we will continue to prioritize our Rx growth, that is clear, while exploring more growth levers for the future. For example, retail media. Myself, I founded two retail media companies in the last 25 years. Marketplace in Switzerland, for instance, a country where we are already very strong.
Third, we will enable the organization to scale with fast decision-making, with clear priorities in technology and AI as levers for better customer experience and lower cost. I will keep you updated on our progress latest next time in our year-end meeting. Now, let us move to our business update. Looking on the highlights of the third quarter. We ended September with 15 million active customers, a little bit more than 15 million. 1.5 million more than a year ago, +11%, and half a million more than in June. We added more than a half a million customers in only one single quarter. That is a clear sign for me of trust customers place in us.
In Germany, we now have 1.9 million Rx active customers, 300,000 more than a year ago and more than 100,000 more than last quarter, which also shows that e-Rx adoption in Germany continues to gain traction. Rx revenues in Germany grew 56% in the third quarter. This is slightly below Q2, as expected because we are lapping the introduction of the Rx bonus a year ago. It remains a very high growth rate and is the main reason why we raised our Rx guidance. Last but not least, continue to have a very strong NPS for the whole group at a level of 76. Let us go more into details. Talking first about our non-Rx business in Germany. Looking at our non-Rx in Germany, we see a growth of 9% in Q3 after 12% in Q2.
The step down from Q2 is mainly explained by a soft July, when a heatwave impacted our sales. Still, we strongly gained market share. Gross profit margin improved. You do not see it on the slide, only in the text, but the margin improved by 1.6 percentage points year-on-year and by 0.6 percentage points quarter-on-quarter. The margin pressure has eased. This is really an important step. After a period of real pressure, our non-Rx margin is year-on-year improving. It shows that we can grow non-Rx and protect profitability at the same time. Now looking on our very important Rx business. Rx growth in Germany remains stable on a really high level, growing 56% in Q3. This is similar to the 57% in the first half of this year. In absolute terms, we have even accelerated.
In Q3, we added EUR 17 million of Rx revenues in Germany, compared with EUR 12 million in Q2. What is behind this acceleration in absolute Rx revenues? Let's look on the drivers of this growth. Three KPIs explain this best. The first one is the average Rx basket value. It grew by 19% year- over- year, so customers are spending more per order. Second, customers. We added 123,000 Rx active customers in Germany only in Q3. That is almost double the 65,000 in Q2, taking us around 1.9, nearly 1.86 million. Growth is fueled by new customers and the high stickiness of existing ones. Third, very important, and for me, a very important base for our future growth, customers are happier with the experience. NPS for e-Rx is 78, up from 69 a year ago.
With this, I would like to hand over to Hendrik for the financial update.
Thank you, Peter, and a warm welcome as well from my side. Q3 was full of financial highlights. We had increased our guidance in September due to the strong growth of our Rx business in Germany, and at the same time, we have been able to increase our profitability in Q3 significantly with adjusted EBITDA margin up one percentage point year- over- year. Another major achievement in Q3 was the stabilization of gross profit margin, which decreased by only 30- basis points year- over- year this quarter. As a result, we have been able to achieve, as in Q2, a positive net income.
It is just EUR 1 million, but it makes a difference to report a black number. We have as well good news on cash flow. We generated EUR 15 million of cash flow in Q3. This means that year to date, our cash outflow is only EUR 5 million.
We are getting closer to consistently generating cash. Let's talk about revenue. Total revenue grew 18% in Q3. Non-Rx revenue grew 9%, and this means we have not achieved the double-digit growth that we targeted. This is the result of our increased focus on profitability. We continue to fine-tune the trade-off between long-term growth and short-term profit, and we are at the same time monitoring very closely our market share and will continue to invest in high-value customers. We will ensure that we maintain our leadership position in our five core markets, and especially in Rx in Germany. Let's talk about DACH. Our DACH business had a very strong quarter in Q3. Gross profit margin was stable year over year. This is a great result in a quarter in which Rx continued to gain share of revenue.
It was supported by our retail media business and our marketplace business that is growing significantly faster than our overall business. As a result, as you can see on this slide, the margin expansion in DACH is on track. The adjusted EBITDA margin improved 120- basis points year-over-year, from 3% - 4.2%. We grew revenue by 19% in Q3 in DACH whilst reducing marketing expenses. This contributed 110- basis points to the margin improvement. Obviously, we will not continue to reduce marketing spend rate at this pace, but we see further potential to increase marketing ROI. Operating leverage and other selling and distribution expenses added 30- basis points to the margin this quarter. The next boost in this area will come from the launch of the Sevenum automation in Q1 next year. Looking at international. International revenue grew 13% year-over-year.
This is a decrease versus the 17% in growth in Q2, and it is due to a tough competitive environment without changing the fundamentals of the business. At 13% growth, we continue to gain share in our international markets. We are very happy to see the marketplace business contributing in a meaningful way to the improvement of profitability in international. But we have also encountered challenges in Q3. First, gross profit margin for non-Rx was down 80 basis points due to pricing pressure. Secondly, retail media grew less than top line in Q3. We expect a catch-up in this area in Q4. As a result of lower prices and the miss in retail media, adjusted EBITDA margin was flat year-over-year in international at -0.4%. That is slightly below breakeven.
We have made progress with marketing efficiency and cost per order, but we have more work to do to ease this margin pressure. We will improve our assortment and overall customer experience to have to compete less on price. Looking at the total group again, you see that gross profit margin has stabilized in Q3 after a decrease of 170- basis points in Q2. We see our strategy working. More sophisticated commercial steering, driving growth of profitable customers, and building a strong marketplace business increases our profitability in a sustainable way. The group P&L for Q3 and September year to date shows the result of this strategy. Adjusted EBITDA margin was up 100- basis points in Q3 and up 80- basis points year to date. EBIT was EUR 12 million in Q3 versus a negative EUR 2 million in Q3 last year.
But we have as well lots of work to do to steadily increase our profitability by about 100 basis points every quarter. Our Q3 performance underscores that we make progress, and that we deliver. Moving to cash flow. Our progress with respect to profitability translates into an increased cash flow. We generated EUR 50 million of cash in Q3. This reduces our year-to-date cash outflow to EUR 5 million. Please note, though, that we benefited in Q3 from seasonal effects in working capital, and we will see an increase in Q4. Last but not least, our automation project in Sevenum continues to be on time and on budget, and we have obtained a EUR 40 million loan from Deutsche Bank to fund this project. With this, I hand it back to Peter for the outlook.
Thank you, Hendrik, for these details about our financials. Looking ahead, what do we see? What we currently see is that October non-Rx growth is likely to be below 10% due to a slow ramp-up of cough and cold related sales. We continue with our strategy of more frugality whilst investing in new customers with a high customer lifetime. On our guidance, we confirm our full year 2026 guidance across all metrics, and we target a positive free cash flow in 2027. With that, let me pass back to the operator to open it up for the Q&A.
Thank you. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star then two. Participants are requested to use only handsets while asking a question. Anyone who has a question may press star and one at this time. The first question is from Christian Salis, Cantor Fitzgerald. Please go ahead.
Hey, good morning, everyone. Christian from Cantor. Thanks for taking my questions. I have a couple of topics I would like to ask. The first two questions are on your statements on current trading. You mentioned the non-Rx current trading in October, but you did not speak about the Rx business. Maybe could you also talk about that a little bit and give an indication whether the Q3 run rate on a quarter-over-quarter basis of EUR 17 million was also similar maybe in October? Then, you said October was below 10% year-over-year in non-Rx. Now obviously everybody tries to draw conclusions on the current run rate for Q4. Generally the comp base is getting relatively easy with 9% year-over-year last year.
Could you help us understand a little bit more whether the October run rate is representative for the entire quarter, or was the comparable base in October last year still higher and will be much easier in November, December? Therefore, we should not take the October performance as a benchmark for the entire quarter. Maybe you could split this and talk a little bit more about the monthly phasing, also in the comparable base from last year. That would be the first two questions, and then I have another one on the margin side.
Okay. Thank you, Christian. I will start with the first two. Our guidance reflects prudence, not a structural deceleration. Q4 is a big quarter for us, and we want to preserve our flexibility on pricing and gross margin management. The competitive environment remains intense. Yes, we have started with a slightly softer business below the 10% that we typically target. We will see how this evolves. We know how to increase revenue, but we constantly fine-tune, as we said as well during the presentation, the trade-off between short-term profit and long-term growth. We will continue to do that. We expect the Rx growth, the second part of your question, to decrease quarter-over-quarter. We have discussed this before. We have now a quarter in which we fully lap a quarter with bonus in the prior year.
It is normal that there is a slight deceleration, but we are very happy with how we started into the quarter with our Rx business, and we see continued strength and as well continued increase in new customers.
Okay. Just a little specification or clarification here. When you say deceleration Rx quarter-over-quarter, do you mean the percentage rate year-over-year?
Yeah. The growth rate.
the absolute number in quarter-over-quarter EUR million figures?
No, I mean the absolute. Sorry. The growth rate will come down from the 56% that we had in Q3. In absolute numbers, we continue to grow.
Yeah. Okay.
As I said, I mean it's early. We have just started to introduce a new bonus, but we are happy with the momentum that we have in Rx.
Okay. Then, on the EBITDA margin, I would like to understand the e-Rx impact on the EBITDA margin a little bit better. Obviously, on the gross margin, it has a negative impact because of the mix effect. Probably e-Rx should be your highest margin business segment, right? Could you maybe explain a little bit the impact on this 100- basis points margin improvement on EBITDA in Q3 of e-Rx?
Well, just let me clarify. The Rx business has a lower margin than the non-Rx business. This is due to the high ASP and obviously to the price regulation in this market. The unit economics per order are very similar between non-Rx and Rx. But if you talk about EBITDA margin or gross margin percentage, the Rx business is a lower margin business. Now, we continue to optimize all our businesses. We have as well levers, obviously, on the e-Rx profitability. Our Sevenum automation will help us to reduce the cost per order for all products. So we are working on this, but generally, the increase in Rx is always bad news for EBITDA margin in percentage. However, we are very happy with the unit economics of this business.
We are very happy to invest in this business and to pay for new customers because we see how they actually grow as customers. They buy non-Rx, they are very sticky. Therefore, long term, this is a really important pillar of our growth strategy and as well of our increasing profitability because of the scale that this business provides.
Okay. Then a final question on the gross margin. So there was a very good sequential development. Was there any positive one-off effect in the gross margin in Q3, or are these 30 basis points below prior year, is that also something we could expect for Q4?
Yeah. There's no one-off effect here. This is steady improvement. Every week, or maybe you can even say every day, we improve the commercial steering of our business by becoming more sophisticated, managing the business not with averages, but de-averaging, trying to understand what are the parts of our marketing, of our assortment, that we're happy with and where we should fine-tune. We get better at understanding the competitive dynamics, our price perception. There's a multitude of levers that we improve. Peter called it brilliant e-commerce basics, right? That's really what we're doing, and this is translating into better margin management. Now, we're still exposed to competition. Competition does things, and this is obviously a competitive, fairly transparent market, and we react to that. But there's no one-off effect, and you can expect in Q4 as well an improvement of gross margin.
At the same time, as I said, we are as well closely monitoring that we defend our leadership position. We think it's very important that we are the market leader in all our five big markets, because that will provide us with a scale advantage in the long term, and we will not let that slip. So we are as well happy to be tactical about this and lean in in a quarter if we think it is needed to maintain this leadership position.
But overall, we are on a steady path of every quarter improving our commercial steering, stopping the erosion of gross margin that we have seen in the past, and as well improving our marketing mix, getting better at marketing efficiency and obviously then the whole cost per order theme is as well something that we work on every day with the next big step change, as I said, 0.5 percentage points contribution in 2027 just from the Sevenum automation.
All right. Thank you, Hendrik. That's it from my side.
Thank you.
Thanks.
The next question is from Yannik Siering, MPCM. Please go ahead.
Hi, and good morning. Great, thanks for taking my questions. The first one would be on the Q4 margin and the implied margin in Q4. So you are now at 2.9% after nine months and for the midpoint it would only need around 2.5% in Q4 versus 3.4% in Q3. Is there any specific Q4 cost items that you already see, marketing seasonality maybe? Or is that, again, also rather a simply conservative range that you chose here? The second one would be on Rx, and you mentioned that competition has increased its bonus. What is your view on that? Do you plan to change slightly your customer acquisition costs? Are you reviewing that or are you happy with the growth that you saw recently and with marketing coming down, so to keep basically the marketing ratio that we also saw in the past? And then just one small one.
On the Fixum, did you already see the higher Fixum contributing in Q3? And is the rough guidance still for a positive impact of EUR 3 million in H2? That would be it from my side. Thank you.
Yeah. I will start with the last one. Yes, you are right, Fixum is immediately impacting us. It is roughly EUR 1 million per quarter. Yeah, that falls through to the bottom line and will be the same for the coming months. I will let Peter answer the question on the customer acquisition of the new bonus.
Yeah. Very good question. I mean, the whole bonusing is something we manage actively. We adjust this continuously. We strongly believe that we have the best unit economics in the market, which gives us room to compete on price where it really matters. We do not need to win every price comparison. Customers choose us for service, delivery speed, trust. You see it in our strong NPS we are having. We raised the bonus for new customers in October, that is right, and we will keep fine-tuning it. On the other end, we also balance really the growth and the profit. Our guidance reflects that. That is our view on the whole bonus topic.
Yeah. Coming back to your first question about the EBITDA margin in Q4. We have increased our guidance end of September, and I do not want to constantly, for every small change in the business trajectory, give a new guidance. As you said yourself, we are doing well. We are at 2.9, which is at the upper end. Now, we want to bring home Q4, which is a big quarter for us, and we will keep our options and we will react if needed on prices, on marketing. There are ways to increase the marketing as well to increase momentum for Q1. There are different dials that we move to optimize the business, not just to meet a quarter expectation, but to build a strong business over the long term.
Therefore, I am very confident that the guidance is good and, as you can see as well, we have improved 100- basis points in Q3, so we are on a very good and strong trajectory here.
Great. Thanks a lot.
The next question is from Jan Koch, Deutsche Bank. Please go ahead.
Good morning. Thanks for taking my questions. Sorry in case you have already explained some of my points, I had some technical issues. My first question is on the German non-Rx business, which slowed somewhat in Q3. Was that driven by increased competition, including dm's marketing campaign, or was that just because of the heat wave in Germany? I would also like to come back to your non-Rx remarks on October. Could you give us some context on the comparison base? Your German non-Rx business only grew by 5% in Q4 2025. Was that growth broadly similar across all three months, or did it slow throughout the quarter? Secondly, your automation project is entering its final stage. How do you assess the risk of operational disruptions over the coming months, and what measures are in place to mitigate it?
Another company in the sector reported supply chain issues following a PIV integration system last week, so I'm interested in how you are managing that transition here. You mentioned that you are reviewing your commercial strategy in the international segment. Could you elaborate on what this involves? Finally, a bigger picture question for Peter. You have spent much of your career building and monetizing digital marketplaces. Where do you see the biggest gap between Redcare's current position and its full potential?
Maybe we start with the bigger picture and then going into details about the actual numbers. Talking about marketplaces, what I learned over the last 25 years is the key for successful marketplaces is the customer and if the customer is satisfied. I think here is our biggest strength, that we have so many customers and so many happy customers. I think that's the prerequisite to really start the flywheel. Now looking on marketplaces, happy customers, having the right assortments, the right prices, the right positioning, the right services, and then this flywheel starts. I think we have many of the ingredients you need to have a successful marketplace, but also we are still at the beginning in terms of dynamics. We see it already. We see recommendation. We see our customers coming back strongly.
But compared to what I've seen on other marketplaces, we're still very early stage, so the potential is huge. It's a combination of having the right user experience on the one hand, having the right categories, and a broad variety of categories, as well as the right pricing, and have this dynamic of recommendation, of coming back. We see this in many countries already, as I said, but this is the kind of dynamic we know from other marketplaces. I see also clear indications and dynamics in our marketplace. But as I said, the prerequisite is the satisfied customers, and we are really top here. Look on the NPS numbers as well as the comparison to other players in the market. I'm quite confident that we will also see marketplace dynamics in the near future.
Yeah, I'm happy to take the other question. Starting with non-Rx business trends, especially in Germany. You're right, that overall, the cough and cold season is kicking in later. We had this last year. It seems this is as well the case this year may be due to climate change at large. In the end, what we have seen throughout the year is that the German business is very robust. It swings sometimes. As Peter said, we had a soft July, and then the business came strong in August and September. Now we had a softer start into October. I wouldn't say that because we are lapping a quarter of slower growth, or months of slower growth last year, that this provides a lot of tailwind because the root cause seems to be the same.
I can assure you that so far throughout the year, we have not seen an impact of dm. We obviously respect dm as a competitor. We observe this very closely, but we have not seen them taking business from us. That is for sure not the reason for the non-Rx trends that we observe in Germany. Your second question was about commercial steering in international. This is very similar to what I said about commercial steering in general. We have built very significant businesses, especially in Belgium and in Italy. We are the market leader, and as a CFO, I think it's my role to push now for monetization of this leadership position. It's not knee-jerk changes. We're not doing something fundamentally different, but we are looking more about profitability, and we do this by looking at the different pockets of assortment.
As Peter said, category management is important. We need to understand what our customers like buying from us and what their elasticity is and where we can differentiate from competitors and not only compete on price. We are doing this across the business. In Germany, it is very much driven by Rx being a pillar of the business, bringing in new customers and cross-selling. In international, we do the standards of a retail business, optimizing our portfolio, managing prices, optimizing marketing mix. Then we are building as well in these markets, increasingly, a marketplace business, which is accretive as well to the bottom line. Then your other question was about the Sevenum automation project. Yes, you are right. It is a EUR 100 million project. It is big. It can already be admired in the warehouse today. It is basically fully installed. We are starting to do test runs.
It is a complex operation. But the supplier, Vanderlande, and our own team said that they are really amazed by how well it has been working so far. We are fully on track. It is not yet live. There may be operational hiccups. We will tackle them as they come. But we have a very comprehensive plan for how to do this transition in Q1. So far on green in terms of cost management for this project, but as well operational execution and ramping in 2027.
Great. Very helpful.
Thank you.
Thank you.
The next question from Olivier Calvet, UBS. Please go ahead.
Yes. Hi, Hendrik. Hi, Peter. Good to hear from you. Thanks for taking my questions. I have a few left. First, coming back on the quarter to date, Rx revenue growth in Germany. You commented in the September release around the September rate of growth at around 51%, if I'm not mistaken. Are you saying you saw a slightly lower level of Rx growth in October? I would be curious as to any comments you can provide there, given I think September was a comparable month in terms of the Rx bonus program. Secondly, just looking into next year, if you increase your Rx bonus, can you help us in terms of maybe framing expectations with the margin impact? Would you offset that with further marketing reduction, or how are you thinking about it? Just trying to put some numbers to a potential increase in the rebates.
Thirdly, just on non-Rx, any specific markets, you mentioned your leadership in Italy, Belgium, but any specific markets that were weaker in international this quarter? Then probably just a technical question, but helpful to see the formal guide of positive free cash flow in 2027. Just to help us assess your performance next year relative to these targets, since it's the first time under your tenure, Hendrik, that we see this guidance. You will report your definition of free cash flow will be pre-leases and interest expenses or post those. Just curious to that. Thank you.
Yeah. Starting with your last question, we obviously have the very normal IFRS cash flow statement that you will find in our Q3 reporting.
Yep.
For the management presentation, we have tried to simplify this a little bit to help to show how the EBITDA plus working capital, plus the investment in what I call the productive assets, that is basically our PPE investment and then as well capitalized IT contribute to the cash flow. This is really, I think, what is interesting. Then we have a lot of other items. We had a EUR 60 million redemption of the convertible bond and so on. These are one-offs. They are less interesting. We package it in two different ways. Happy to get feedback from the analyst community, what you find helpful. That is how we do it right now to keep it simple and focus on where we operationally improve our cash flow. Your other question.
Yes, you are right, Rx growth rate, I said it before and I will not provide a more detailed guidance on Rx. The October run rate is below the 50%, and that is as expected. This is within our guidance. We give an update in these meetings. We want to inform the markets that something is not on the guidance overall run rate, which is the case for non-Rx, where we said it is slightly below 10%, but not saying anything about Rx is not meaning bad news. It just means it is working out as expected.
On the international markets, the biggest market by far are Italy and Belgium. There is no other market that would be meaningful impact the trajectory. We have as well a good business in France, but it is still very small, and at this point, a strategic asset more than moving the needle for operational results. Another one, have I forgot a question that you asked?
Just the
On the bonus.
Maybe to clarify. Yeah. But maybe just on the non-Rx part, maybe I wasn't clear. The question was a bit more if you could point to the specific markets that were weaker in Q3, explaining the weaker top-line growth. You mentioned pricing.
In international, we had a soft quarter across all markets. It's not because we fine-tune this basically, right? We constantly manage the trade-off between investing in growth and improving the margin. We, to some extent, steer this, and we have decided in our large markets to not be too aggressive and to be happy with 13% growth. There's not one single market standing out here. To your other question, I can just build on what Peter said. We are not discussing here the details of our commercial strategy. We just introduced a slight change to our bonus scheme for Rx early October. We will observe this and then we will adjust this as the co-payment goes up in 2027, and we constantly optimize this. It's not a secret that higher discounts or boni obviously reduce the margin. Goes without saying. It's very transparent what we're doing.
It is on our website, right? There is no fundamental change planned here. We enjoy very good unit economics. As Peter said as well, we think we have the best unit economics in this market. We can provide if we want to, and if we think that fuels growth for customers that we like, we can as well increase the bonus. At this point, the bonus that we are operating right now is the best benchmark.
Okay. Thanks a lot.
As a reminder for questions, please press star and one on your telephone. We have a follow-up question from Christian Salis, Cantor Fitzgerald. Please go ahead.
Yeah. Two follow-up questions from my side. The first one on CapEx free cash flow again. CapEx was relatively low in Q3. Is this a sustainable run rate going forward, or was there any special effects? Given that free cash flow was positive now in the first nine months, can we also expect free cash flow to be positive in the full year? Second quick question, could you explain the key drivers behind the 19% growth in Rx average basket size, please? Thank you.
Yeah. To your question about cash flow. Cash flow will remain negative in 2026. We have overall EUR 30 million investment in the Sevenum automation. You are right that there is a little bit less in Q3. There will be a little bit more in Q4. But overall, this EUR 30 million of CapEx, which is a one-off, will prevent us from having overall positive cash flow. And we have an increase in working capital. So, in Q3, typically because of seasonality, working capital is lower, but we will have to invest in working capital for the peak season, which is obviously the cold season. So, the coming months and then as well early 2027. But as I said as well, we are targeting a positive cash flow in 2027. And then your other question, sorry. So, what was the other question?
[Inaudible ] Pesticide increased to 19%, if I got it right.
The 19%? Your question is how this is compounded, or?
Yeah. What are the key drivers behind that?
Well, our biggest market by far is Germany. We have shown as well in the presentation the German non-Rx growth, and we are showing the Germany Rx growth. We have as well carved out MediService. MediService has been growing 10%, which is a substantial growth. Our 90% are driven by the strong 56% growth in Rx. That is the driver of the DACH business. Austria is not meaningful in this context, if that is your question.
Okay, thank you.
This was the last question. I would like to turn the conference back over to Peter Schmid von Linstow, CEO, for any closing remarks. Thank you.
First of all, thank you for your questions and joining us today, our Q3 earnings call. What we see, the Q3 shows strong Rx momentum and improving EBITDA margin and more than 15 million active customers. That is a great base. We have more to do, and I look forward to updating you in January about Q4 trading. Have a good day, and thanks again for joining us today.