Ladies and gentlemen, welcome to the Richemont Full Year 2023 Interim Results Presentation. I'm Alice, your call operator. The conference must not be recorded for publication or broadcast. At this time, it is my pleasure to hand over to Sophie Cagnard, Group Corporate Communications and Investor Relations Director. Please go ahead. Thank you, Alice, and good morning, everyone. Thank you for joining us for Richemont's half year results presentation for the period ended 3rd of September 2022. Here with us today are Jérôme Lambert, Group Chief Executive Officer; Burkhart Grund, Group Chief Finance Officer; Cyrille Vigneron, Cartier Chief Executive Officer; and James Fraser, Investor Relations Executive. Sorry, James. We would like to remind you that the company announcement and results presentation can be downloaded from richemont.com and that the replay of this audio webcast will be available on our website today at 3:00 P.M. Geneva time. Before we begin, I would like to draw your attention to the disclaimer on our presentation and company announcement regarding forward-looking statements. Turning now to the presentation, Burkhart will begin by discussing key highlights and group sales. I will then provide further detail on the performance of our Maisons. Finally, Burkhart will take you through the financials and offer some concluding remarks. This presentation will then be followed by a Q&A session. I will now hand the call over to Burkhart. Thank you, Sophie. Good morning to everyone listening, and thank you for joining us today. Before going into the financials, I would like to highlight that following the announcement last August of the agreement to sell a controlling interest in YNAP to Farfetch and Alabbar to create a neutral industry platform, YNAP's results for the period ended 30th of September 2022 are presented as discontinued operations, and its assets and liabilities are transferred to assets or liabilities held for sale in accordance with IFRS rules. Remember that this agreement is subject to a number of conditions, including the receipt of certain antitrust approvals. As a consequence, Watchfinder's results are now reported within the other business area. Prior year period and H1 income statement figures have been represented accordingly. Sales for the six-month period ended September 2022 for our continuing operations grew by strong double digits, with a 16% increase at constant exchange rates and 24% increase at actual exchange rates. Sales were positively impacted by favorable currency movements during the period, adding 8 percentage points to group sales growth. Operating profit increased by 26% over the prior year period to EUR 2.7 billion, delivering an enhanced operating margin of 28.1%. This represents a 30 basis point gain in operating margin over the first half of last year. Profit from continuing operations rose by 40% to EUR 2.1 billion. Cash flow from operating activities at EUR 1.5 billion was robust. Our net cash position at EUR 4.8 billion was solid, especially considering the EUR 1.9 billion euro dividend cash outflow in September, which represented an EUR 800 million-EUR 1,000 million euro year-on-year increase. The strong sales trends seen in the first quarter of our financial year continued into the second quarter, such that half-year sales grew at double digits across all business areas, channels and regions at actual rates, except for Asia Pacific, where reported sales increased by 3%. The strongest sales increases came from the Americas, Europe and Japan region-wise, and from our directly operated boutiques channel-wise. The strong operating profit from continuing operations reflects the benefits of past decisions. Along with watch inventory buybacks, we effectively managed the sell-in, sell-out ratio while optimizing our wholesale network. These actions have led to a sound inventory position and stronger partnerships with our multi-brand retail partners. Improved manufacturing processes have provided more agility to better address changes in demand. In parallel, we embarked on our digital transformation journey, providing another route to market, which has proved particularly beneficial when stores temporarily closed. This has enabled us to aspire to realizing our luxury retail vision, where frontiers between bricks and mortar retail and online retail disappear. The recent agreement with Farfetch and Alabbar was a key milestone in our progress. More on this later. We continued to advance on our ambitious sustainability goals, focusing on reducing our environmental footprint, amplifying our social handprint, and refining our governance. We're ahead of schedule on our 2025 goal to source 100% of renewable electricity, are refining our human rights strategy, and have undertaken proactive engagement with stakeholders, including NGOs. More on that later as well. Let me now discuss the group sales performance in more detail, first by region and then by distribution channel. Unless otherwise stated, all comments refer to year-on-year changes at constant exchange rates. Almost all regions showed strong double-digit increases, led by Japan in terms of rate of increase. Thereafter, Europe and the Americas. 76% sales increase in Japan was driven primarily by local clientele. Sales were also supported by a nascent return of tourists, primarily from Southeast Asia and also from a favorable comparison base due to boutique closures in the prior year period. Sales in Europe, up 45%, benefited from inbound American and Middle Eastern tourist spending and robust domestic demand. Sales in the Americas region rose by 22% with a significant growth of 29% experienced in the first quarter of our financial year, softening to 14% in the second quarter as American tourists were traveling to and buying in Europe. Sales to the American clientele overall remained strong. The largest contribution to the overall sales increase in value terms came from the Americas and Europe. The momentum in Asia-Pacific improved significantly, with second quarter sales up 6%, leading to the sales decline for the six-month period moderating to 5%. Although continued health restrictions in parts of China weighed on sales, the region benefited from sharp sales growth in other markets such as Australia, Singapore, South Korea and Thailand. Group has a well-balanced geographical mix. Asia-Pacific represented 39% of group sales. The Americas, 23%. Europe, 22%. Japan and the Middle East and Africa together 16%. It is worth noting that the Americas share of group sales has surpassed that of Europe, and the U.S. is at par with mainland China. Let us now turn to sales by distribution channel. Retail delivered the strongest channel performance, with sales increasing by 21%. This strong performance was driven by double-digit sales increases across all business areas and regionally by the Americas, Europe and Japan. Momentum accelerated in the second quarter, particularly at the jewelry Maisons and specialist watchmakers. Retail sales contribution to group sales rose by three percentage points to 67%, excuse me, compared to the prior year period, making retail by far the largest contributor to group sales. Online retail sales at 6% of group sales increased by 9%, with growth across all business areas. Growth was particularly strong at the specialist watchmakers, where almost all Maisons showed significant double-digit sales increases. Within the regions, Japan and the Middle East and Africa registered the sharpest progression rates, albeit from a relatively low base. The Americas, up double digit, remained the largest contributor to online retail sales. Now moving to wholesale sales, which includes sales to monobrand franchise partners, to third-party multi-brand retail partners, as well as sales to agents in addition to royalty income. 27% of group sales. Wholesale sales rose by 6% versus the prior year period. Fashion and accessories Maisons contributed much of this growth, with most Maisons posting double-digit increases. Almost all regions posted strong double-digit growth, led by Europe and Japan. Direct-to-client sales, which represent sales in our directly operated stores and online retail sales, grew the contribution to group sales to 73%. The DTC rate was highest at the jewelry Maisons at 83% and above 50%, both for the specialist watchmakers and the fashion and accessories Maisons. This high level of direct interaction enables us to better know our clients, hence serve them better now and in the future. Over to you, Sophie. Thank you, Burkhart. We now review the business areas with all comparisons at actual rates. Let me start with the jewelry Maisons, which include Buccellati, Cartier and Van Cleef & Arpels. Sales increased by 24% with double-digit growth in almost all regions, led by Europe and Japan, with an acceleration from the first quarter to the second quarter. Direct-to-client sales represented 83% of sales, with three percentage point increase off of the prior period as both retail and online retail sales outperformed. The operating result rose by 22%, a direct consequence of strong sales growth, gross margin due to pricing power and targeted investments into distribution and communication. Operating margin amounted to 37.1%. Let us look at the main developments over the past six months. The jewelry Maisons posted excellent performance across all product categories. Jewelry sales were sustained by iconic collections which included Trinity and Clash at Cartier, Alhambra and Fauna at Van Cleef & Arpels, and Opera Tulle and Macri at Buccellati, to name a few. Watch sales included notable performance from the Tank and Santos collections at Cartier and Poetic Complications at Van Cleef & Arpels. The retail network was further developed during the first half of the year. New openings included Chengdu IFS and Singapore Marina Bay Sands for Buccellati, Nanjing Deji Plaza for Cartier, Van Cleef & Arpels first stores in New Zealand in Auckland, and first flagship store in Seoul, Cheongdam-dong. The renovation program continued notably at Cartier with new Fifth Avenue, New York and Paris Rue de la Paix, which reopened on 28th of October after two years of major renovations. Buccellati's website was relaunched with an enhanced user experience and a new e-commerce capability. The segment's focus on sustainability continued during the period. Cartier, within the context of the group's 1.5-degree climate strategy, reinforced its measures to reduce the environmental footprint of its worldwide operations by having all stores and manufacturing sites newly built or under renovation LEED certified by working on sourcing 100% renewable energy and removing single-use plastics. Van Cleef & Arpels progressed in its objective of 100% RJC chain of custody certified finished goods products with approximately three-quarters of suppliers already certified. Buccellati is nearing completion of a process for becoming RJC certified. Let us now review our Specialist Watchmakers business area, where sales in the first half grew by 22% versus the prior year period. This solid growth was driven by double-digit increases in almost all regions and a strong increase in direct-to-client sales. Sales in all channels grew with particularly significant growth in retail and online retail. The operating results increased 35% to EUR 506 million, leading to 240 basis points operating margin improvement to 24.8%. This achievement was driven by solid sales growth and strong cost discipline. All Maisons grew sales during the period, with excellent performance of iconic collections such as the A. Lange & Söhne Lange 1, Baume & Mercier Riviera, IWC Pilot's Watch, Jaeger-LeCoultre Reverso, Panerai Submersible, Piaget Polo, Roger Dubuis Excalibur, and Vacheron Constantin Traditionnelle. Direct-to-client sales increased to 54% this year from 47% of Specialist Watchmakers sales for the same period last year. As part of a network development, there was a net increase of 12 directly owned stores and 9 franchise stores, mainly in Europe and Asia Pacific. New openings included Panerai in Zürich Bahnhofstrasse, IWC in Dubai Mall, and among the renovations, Vacheron Constantin in Dubai Mall. There was also continued development of e-commerce capabilities and services, with notably the go live of e-commerce and customer relationship centers for Panerai and IWC in Mexico. In terms of development within the multi-brand environment, the TimeVallée retail concept was rolled out further with 9 new boutiques in the first half of this year, compared with seven openings in the first half of last year, almost all in China. Finally, let me share that we have put in place a strong governance mechanism through a newly launched Specialist Watchmakers Sustainability Committee to provide our watch Maisons with guidance and leadership on ESG topics. In September, the Watches and Culture Sustainability Forum was held in Geneva to promote sustainability in the watch industry, notably around climate change, biodiversity, equality, and inclusion. Let us move to the other business area, which includes the Fashion and Accessories Maisons, Watchfinder & Co., the Group's watch component manufacturing, and real estate activities. Sales rose by 27% year-on-year, with most Maisons and regions posting significant increases. Regional growth was particularly noteworthy in the Americas and the Middle East and Africa. All channels saw higher sales led by wholesale, owing to increased recognition for renewed creativity and relevance from international wholesale buyers, notably from the U.S. Operating profit amounted to EUR 56 million, up 33% over the prior period. Excluding a real estate transaction in the prior period, operating profit grew triple digits. Operating margin was 4.3%. Almost all Maisons recorded significant growth, supported by strong contributions from both new and existing collections in our Fashion & Accessories Maisons. New collections included the Montblanc Extreme, Leverline, Chloé Fall 2022 and Alaïa Summer/Fall 2022 collections. Existing collections received notable contributions in clothing from G/FORE at Peter Millar in leather goods from the Chloé Nama line and Delvaux Le Mutin small leather bag, as well as from Montblanc Meisterstück within writing instruments. Chloé recorded good growth alongside Montblanc that benefited from an improvement in travel retail and strong and successful product launches, as well as stepped-up merchandising competence. Alaïa, Delvaux, and Peter Millar have all seen particularly solid performances during the first half. The Maisons have continued the upgrading of their retail network with notable retail openings, including Chloé MixC mall in Shenzhen, the first ever boutique in the Middle East in Dubai Mall, and Peter Millar in Charlotte, North Carolina. Notable renovations including the Alaïa boutique in Dubai Mall, as well as Montblanc selection stores on the Champs-Élysées in Paris. Sustainability initiatives are also underway across the Maisons and are focusing on improving transparency and traceability of our products. Significant progress has already been achieved in leather. Watchfinder, which is now part of the other business area, further strengthened its international operations with new shops in France, Switzerland, and the U.S. To better serve our clients on a global basis, Watchfinder has a new servicing hub in Madrid and a U.S. logistics hub in Dallas. There was a further rollout of its watch trading program through the jewelry Maisons and the specialist watchmakers. This concludes the review of the first half performance of each business area. Burkhart, over to you. Thank you, Sophie. Let me walk you through the rest of the P&L, starting with gross profit. Gross profit was up 27% on last year, leading to an enhanced gross margin of 68.9%. The 140 basis points increase reflected favorable currency movements, geographical mix, and a larger share of retail sales, as well as price increases that altogether more than offset higher input costs and inflationary pressures throughout the supply chain. Let us now look at net operating expenses, which rose by 28%, a rate slightly above the 24% sales progression rate. Given the particularly subdued level of OpEx increases in H1 of last year, followed by a marked increase in H2, notably related to headcount, this is a good outcome. Selling and distribution expenses increased by 27% at actual exchange rates and by 19% at constant exchange rates. They represented 22.8% of sales, a slight increase versus 22.3% of sales in H1 2022. The increase was driven by higher retail sales affecting variable costs such as leases and commissions, and the growth of the group's retail operations. Communication expenses were up by 33% year-over-year at actual exchange rates and by 24% at constant exchange rates, reflecting reinforced investments in communication to support sales growth and build brand equity. As a percentage of sales, they amounted to 8.3%. This ratio is 60 basis points higher than in the prior year period, but still below the more normalized range of 9%-10% for the full year. Fulfillment expenses, that is, that are the cost of fulfilling online orders from our Maisons and Watchfinder, rose by 33% year-on-year at actual exchange rates. With YNAP expenses now shown in discontinued operations, fulfillment expenses represented only 1% of sales in the current and prior year periods. Administrative expenses were 24% higher than in the prior year period at actual exchange rates, and 15% at constant exchange rates. The higher spending was in line with the increase in sales and largely reflected a stronger Swiss franc, increased logistics, and IT-related expenses. As a percentage of sales, administrative expenses remained at 8% in line with the prior year period. Overall, net operating expenses amounted to 40.8% of group sales. This leads us to operating profit, which at EUR 2.7 billion increased by 26%, reflecting higher sales, improved gross profit, and controlled operating expenses. As a result, operating margin increased by thirty basis points to 28.1% of sales. Let us now review the rest of the P&L items below the operating profit line, starting with finance costs. Net finance costs eased by EUR 180 million to now EUR 202 million, mainly explained by two items. First, there was a positive EUR 150 million reversal in the line net foreign exchange gain on monetary items, moving from a EUR 55 million loss in the prior year period to a EUR 95 million gain this half year. Secondly, fair value adjustments reduced by EUR 88 million, reflecting reduced fair value losses on the convertible note and options related to the Farfetch investments. Following the announcement of the agreement with Farfetch and Alabbar on August 24 to sell a controlling interest in YNAP, subject to a number of conditions, including the receipt of certain antitrust approvals, YNAP is reclassified to discontinued operations. The assets and liabilities have been reclassified to assets held for sale and liabilities held for sale on the balance sheet, while the results for the year to date are presented as discontinued operations. For comparative purposes, all prior period and H1 income statement figures have been represented to reflect this change. During the first half, sales from discontinued operations, mainly composed of YNAP sales excluding inter-segment sales, increased by 11% at actual exchange rates and by 4% at constant exchange rates. Growth at YNAP was led by Net-a-Porter and Mr Porter, while Yoox grew revenues by mid-single digits and expanded its marketplace offering with the introduction of the home and art category. Feng Mao revenues grew at high double digits compared to the prior period, with the Net-a-Porter Tmall flagship store now retailing over 400 brands. Factoring in the EUR 2.7 billion non-cash asset write-down, operating result from discontinued operations translated into a EUR 2.9 billion loss. Profit for the period from continuing operations increased by 40% to EUR 2.1 billion, mainly reflecting the higher operating profit. After the EUR 2.9 billion loss from discontinued operations, the loss for the period amounted to EUR 766 million. Our effective tax rate for the first half of the financial year from continuing operations was 18%. It is in line with our expectations of the full-year tax effect, absent any special unforeseen items occurring in the second half of the year, and is within an envisaged 18%-21% range. Cash flow generated from operating activities was EUR 241 million lower than the prior year period at EUR 1,540 million. The increase in operating profit from continuing operations was more than offset by additional investments in working capital, including in precious metal inventories, partly impacted by a stronger Swiss franc versus the euro, as well as higher levels of receivables due to strong sales growth. Let us now turn to our gross capital expenditure. Investments totaled EUR 377 million, a 38% increase over the prior year period. At 3.5% of sales, capital expenditure was slightly higher than the 3.1% ratio in the prior year period. 47% of gross capital expenditure related to point of sales investments, mostly renovations and relocations of directly operated stores. New store openings beyond the ones previously mentioned include Van Cleef & Arpels in San Francisco, A. Lange & Söhne in Boston, Alaïa in Tokyo, and Chloé in Shanghai. It also included relocations and renovations such as Cartier in Seoul, Vacheron Constantin Dubai Mall, Delvaux in Paris, and Montblanc as well in Seoul. Manufacturing spend increased to 19% of the overall spend and was mostly related to Cartier and Van Cleef & Arpels to support their strong growth. Other investments made up 34% of CapEx and included IT investments predominantly. Let us now turn to free cash flow. Free cash inflow of EUR 808 million reflected lower cash flow from operating activities and higher capital expenditures, mostly offset by lower net acquisitions of other non-current assets. The prior year period included the investment in the China joint venture with Alibaba and Farfetch. Our balance sheet remains strong. Shareholders' equity accounts for 46% of the total. Net cash amounted to EUR 4,763 million on the thirtieth of September 2022, a EUR 488 million decrease compared to the thirty-first of March 2022, which is more than explained by the dividend cash outflow. The dividend payment of EUR 1,851 million reflects an ordinary dividend of 2.25 CHF per A-share, plus a special dividend of 1 CHF per A-share, which was approved by shareholders at the AGM in September. Special dividend is a recognition of the excellent performance achieved and a gesture towards our loyal long-term shareholders. I would now like to provide an update on our sustainability program viewed through the ESG lens, starting with the E for environment. In line with our ambitions to reduce emissions, we are on track to source 100% renewable electricity for the group before the end of 2025. Europe, our objective is to reach a 10% energy saving target for gas and electricity in offices and boutiques in the next six months. This will be achieved by a series of energy-saving measures, including reducing temperatures by a minimum of 1% across all sites. Top priority for Richemont over the coming years is to safeguard biodiversity. We are currently working with biodiversity experts to conduct a materiality assessment to identify key materials and supply chain elements in terms of its impact. This will form the group's biodiversity targets as well as our strategy to meet these targets. We aim to finalize our strategy in the latter part of 2023, and we'll keep stakeholders updated in due course. Looking at the social element of ESG, we have reviewed and updated key internal policies to ensure that respect for human rights is embedded into our decision-making processes and our engagement with suppliers. One such policy is our Supplier Code of Conduct, which is required to be signed by our suppliers. The code now better reflects emerging best practice, notably in the areas of business and human rights and whistleblowing. We are introducing this December the Richemont Speak Up platform, open to external and internal stakeholders, in line with the UN Guiding Principles on Business and Human Rights and the EU Whistleblower Directive. In parallel, we are further refining our human rights strategy. Governance remains core to our sustainability ambitions, and with the appointment of our first Chief Sustainability Officer at the start of this calendar year, we have now embarked on the next phase of our sustainability strategy. This year's sustainability report was redesigned to our ESG ambitions and will continue to be grounded in the UN's Sustainable Development Goals. To prepare for the integrated reporting requirements due in calendar year 2024, that is to say, in our fiscal year 2025 reporting, we have aligned the external assurance process for all voluntary and mandatory ESG reporting with our financial reporting. We believe that companies should be a force for good in society in general, and the communities in which they operate in particular. In this context, we're in constant dialogue with our key stakeholders to ensure alignment of objectives. Most recently, we have stepped up engagement with NGOs on the topics of climate, circularity, and human rights. In August, we announced a partnership between Farfetch, Alibaba, and Richemont to accelerate our Maisons luxury retail ambition and turn YNAP into a neutral industry-wide platform for the benefit of all brands and end clients. At the completion of the initial stage, which is subject to a number of conditions, including the receipt of certain antitrust approvals, YNAP is to be co-owned by Farfetch with 47.5%, Alibaba with 3.2%, and Richemont with 49.3%. Both Richemont Maisons and YNAP are to adopt Farfetch Platform Solutions, or FPS, a leading integrated omni-channel platform. For the Richemont Maisons, FPS will power their websites and provide an integrated solution between their online and physical retail operations. Several Richemont Maisons will also open e-concessions on the Farfetch marketplace, widening their offering to attract and retain more customers while optimizing working capital needs and meeting brand partners' requirements to establish a direct relationship with end clients. For YNAP, this will help accelerate its shift towards a hybrid retail marketplace model. Accessing a technology natively built on three P with integrations with most of the luxury brand partners YNAP works with, will save precious implementation time. An additional benefit for Richemont is to achieve economies of scale by running a single standard and benefiting from innovations across all stores simultaneously. As for the next step, there will be no action taken until antitrust clearance is received. We will, in time, start studying how best to potentially adopt Farfetch Platform Solutions. Lately, analysts and investors have asked how Richemont is likely to face, to fare during a significant downturn, whether we have become more resilient compared to 2008. I cannot respond directly to that question given the number of unknowns, but we can highlight how different Richemont is today compared to 2008. First, with more than EUR 19 billion in sales and EUR 3.4 billion in operating profit for our 2022 financial year, we have experienced a step change compared to fiscal 2008 sales, an operating profit of EUR 2.7 billion and EUR 0.8 billion respectively. We have progressed strategically from being very wholesale distribution-driven to becoming online and physical retail distribution-focused. The proportion of wholesale sales has halved 20%-27%. Online retail sales have emerged to reach 6% of group sales. Overall, our direct-to-client sales have increased from 42%-73% of group sales. This high level of direct client interaction enables us to know who our end clients are, understand their needs, and receive insights on the evolution of the level of demand to appropriately adapt the group's production and investments. In 2008, watches were predominant, representing 48% of sales, compared to jewelry at only 24%. Today, the weighting between watches and jewelry is more balanced, with jewelry having increased share to 48% of group sales and watches accounting for 37% of group sales. With Cartier, Van Cleef & Arpels, Buccellati, and Piaget, Richemont is in a strong position to capture the growing demand for branded jewelry in a market which is so vastly unbranded. It is not solely a matter of Richemont versus peers, but it is the branded versus the unbranded market, with the conversion to branded likely to be a strong, sustainable trend. We have continued to evolve our offering with both higher and more welcoming price points, as well as different collections that appeal to different customer groups. This pricing architecture allows scalability across price points for our customers. This was consistent in balanced pricing around the world and across our markets. Based on the prices seen at auction and strength of demand, many of our Maisons collections have reached iconic status, the latest being Submersible at Panerai and Traditionnelle at Vacheron Constantin. As we have strategically extended our global reach, the weight of the Americas and Asia Pacific has increased, such that these two regions contribute 62% of group sales compared to 40% in 2008. Sales are broadly equally split between Europe, Greater China, and the Americas, with Southeast Asia being roughly the size of combined Japan and the Middle East. This emergence of five engines makes the group more resilient than in 2008. In terms of individual markets, today, the US is roughly the size of Mainland China, which itself is close to Europe at around EUR 2 billion each for the half year. We have been first movers to introduce better discipline in the management of our watch inventory, now managed through the sell-in, sell-out KPI. Our watch inventory within our multi-brand retailers and at Richemont continues to be in a healthy state today as a result. The quality of our watch distribution with fewer partners, but more partnership has been enhanced. In parallel, we have gained an agility and flexibility in our manufacturing entities and supply chain, enabling us to better adjust to meet changes in demand. The most visible displays of this were first seen during the Hong Kong events that disrupted sales in this important watch market, and then of course, during the COVID pandemic outbreak, where we initially had to stop all non-essential production to subsequently ramp up as market emerged from lockdowns. As a result of this transformation, Richemont's operational performance has been strong since we all entered the COVID pandemic. If we examine the performance of our watches and jewelry combined over the last five years, these two product categories have generated strong growth, delivering a CAGR of 11% compared with 6% for the closest peer. Similarly, if we look specifically at the sales of watches as a product category, Richemont has outperformed the watch market when looking at the Swiss watch export data, especially since 2019. This, whatever the price points. Before turning over to the Q&A, I would like to summarize and offer some concluding remarks. For the first half of this year, Richemont showed excellent operational and financial performance, with sales close to the EUR 10 billion mark, driven by double-digit increases across all business areas and distribution channels. Operating profit from continuing operations also increased by double digits to over EUR 2.7 billion, translating into an improved operating margin of 28.1%. The solid performance was underpinned by a unique portfolio of enduring Maisons. All business areas grew markedly by double digits and profitably. The jewelry Maisons consolidated their strength with a 37.1% operating margin. The specialist watchmaker's ongoing transformation of the business model is successfully translating into higher profits with a 24.8% operating margin. At the fashion and accessory Maisons with other, almost all Maisons grew sales strongly, and the business area generated a 4.3% operating margin. There, we are looking to build scale and invest for the long term. In addition, with the agreement reached with Farfetch and Alabbar, we have progressed significantly in our luxury retail agenda. YNAP and our Maisons will adopt Farfetch Platform Solutions to realize the luxury retail vision, all conditional on receiving regulatory approvals. Regarding sustainability, we are stepping up our ambition, refining our strategies, and improving key internal policies. Our team is working on all required ESG aspects to ensure we remain focused on delivering sustainable, responsible, and profitable growth. Finally, we have a strong balance sheet to weather economic cycles and seize opportunities that may arise. Uncertainties abound, but we look to the future with vigilance and confidence. This concludes our presentation. Thank you for your attention, and I will now hand back over to Sophie. Thank you, Burkhart. We will start the Q&A session shortly. Before raising your questions, please announce your name and company name and try to restrict yourself to two questions. Thank you. Floor is now open for questions. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. The first question comes from the line of Ashley Wallace with Bank of America. Please go ahead. Hello, Ashley. Oh, good morning, Sophie. Hello, Sophie. Hi, Burkhart. I have two questions, actually. They're both around the growth margin bridge chart that you presented today, which is really helpful. Thank you for the incremental granularity. My first question just relates to the fact that within that bridge chart, it shows that there is growth margin pressure coming from utilization and other. Can you help us understand what exactly that is? Then my second question is on the FX and the impact on gross margin, which was positive in half one. Can you help us understand a little bit how we should think about the FX factors going into your gross margin into the second half? So if that will still be a positive contribution. Actually, let me just answer the first question first. That depends on how the exchange rates go in the second half, which we don't know, and, as you know, we don't project this out. I cannot really answer that question. With regards to the first question, in the gross margin bridge, we have a positive FX impact, which we have flagged here in the gross margin bridge. Then we have, to date for the first half, and once again, I'm careful on that, we have a favorable country and channel mix effect, which we have in the middle column there. Obviously with Europe and Japan up and China relatively subdued or even down in real terms in the first half, we have a positive channel country mix coming out of that. Channel mix, more retail, less wholesale also benefits, but to a lesser extent. In this column we also have aggregated the positive impact we see or we have from the price increases that our Maisons have done. Price increases have been in the area of 4%-8% over this year, meaning the first six, seven months of this year. We've done them in two waves. The impact we have, that is, you see a negative impact here in the third column is exactly why we do these price increases, which is the adverse effect of, you know, raw material price increases, especially gold, where we see the biggest impact at the jewelry Maisons. In our books, gold price has increased over the prior year, impacting our gross margin now with about a 14% increase. That is what we see in that third column. Or fourth column, actually. Okay. It's mainly raw material price increases rather than underutilization of production is the biggest factor. Well, there is no underutilization of production. We are stretched on the other side, actually. Okay. Still struggling in some of our Maisons to rebuild inventory, and there is no underutilization of capacities whatsoever. We're short in product in some areas. Okay, thank you. Thank you, Ashley. Maybe connected to that. Sorry if you don't mind, Sophie, just one really quick follow-up. What was the amount of the precious metal purchase you made in the first half? Call this out in terms of, like, the inventory, the impact on inventory going up was to do with the precious metal purchases. Okay. Yeah. No, no, that's an easy one. I mean, you know, we, with the outbreak of war or the invasion of Ukraine, to be specific, you know, we have obviously looked at critical inventory categories in terms of raw material. You know, we've spoken at length in May about what we've done on the diamond sourcing side. Not only to be compliant, but also to diversify our sourcing strategy. We've also looked at other raw materials such as platinum and rhodium, yes, and we've increased our holdings of these raw materials. That's why we focus on cash generation, so that in challenging situations, we can actually have the means at our disposal to upgrade or upsize our inventory holdings in these critical materials, and that's what we've done. Perfect. Thank you. Thank you. you. Thank you, Ashley. We can move to the next question. The next question comes from the line of Edouard Aubin with Morgan Stanley. Please go ahead. Hello. Good morning, Edouard. Yeah. Good morning, guys. Edouard Aubin, Morgan Stanley. Congrats for the really great set of results. I have two questions on jewelry Maisons margin, because obviously that was a key topic of discussion during the full year results back in May. The first question, Burkhart, is you were able to more or less maintain a historic high, you know, margin, operating margin levels for jewelry Maisons despite the step-up in marketing and I guess bonus as well. What were the offsets, you know, to that? Was it the gross margin expansion mostly, or you got some operating leverage as well? That's question one. Looking ahead, you know, if you look at, on average, you know, the second half tends to be, I know there is wide dispersion, but on average tends to be around 300 basis points lower than the first half. I know you don't like to guide, but, you know, is there any reason to believe that, you know, the seasonality would not be the same this year than in previous year? More long-term related to that, again, I know you don't like to guide, but in the past you indicated to the market that you think jewelry Maisons should be around 30%-35%. Type of range in terms of margin, you know, are you ready now to revise upward in the 35%-40%, or at least in the around 35% type of, you know, long-term range? Thank you. Well, I can revise that to a 20%-50% range if that helps your modeling. No, I mean, I think, you know, we're still comfortable with that range, especially, you know, given what we've been saying over a number of years now that it's a category in which you have to consistently deploy capital into. Especially now into a category which, yes, has very sound underlying growth drivers. You know, the unbranded versus branded part of the market is still quite big. It is, and has become a category which, as we've discussed a number of times over the last years, is highly attractive to competitors now. You know, we've always said that we are willing to spend whatever we need to spend to maintain our leading position. In that context, that's the best I can give you, that we're still comfortable with that range at this point in time. Coming back to H1, yes, you're right, pricing power, meaning increased enhanced gross margin, has helped or enabled the jewelry Maisons to maintain their operating margin more or less in the same range, above 37%. That has been what has played out here. Now, the cost increases, and that applies across the board and across the business areas for the continuing operations have mainly been driven by full-year effects of increased investment into people and store networks in the second half of last year. So it's a two-thirds, one-third. So we have a full-year effect that explains more or less two-thirds of the cost increase on the fixed cost side, and about one-third is ongoing investments or additional investments in people and network. Guidance for the second half of the year. You know, A, we don't really like giving guidance. B, I think there are so many uncertainties out there that I'm a bit hard pressed to be helpful on that element. You know the business cycle, you know the H1, H2 cycle. Directionally, that is what we're looking at, that we're gonna have a, you know, on the operating contribution side, a lower second half than in the first half. Okay. Thank you. Yes, thank you. Thank you, Edouard. We can move to the next question, please. The next question comes from the line of Zuzanna Pusz with UBS. Please go ahead. Good morning, Zuzanna. Hey. Good morning, Sophie and Burkhart. I have two questions. Jérôme and Cyrille. Sorry? Jérôme and Cyrille are here as well. Hello, Zuzanna. James. Yes, hello. Hi, Cyrille. I have two questions. I think one you will like, the other one you may not necessarily like. The first one is on the consumer. I've seen some headlines, you were talking a little bit about the consumer trading up. Would you be able to maybe share some high-level thoughts around what you're seeing by maybe age group, by nationality, anything interesting you could call out around the consumer behavior? I think specifically if you believe that perhaps in an inflationary environment, jewelry and watches tend to actually benefit more, so that whole argument about higher cyclicality is even more flawed in this environment. The second question, which sorry, I have to ask, but would you be able to give us maybe any color on the exit rate? I know you don't like commenting on specific months, but, you know, we always have to ask, and we always try to understand how we should think of the next quarter. You know, anything high level, if October was in line with Q2, was it a bit lower, higher? Anything you could share would be very helpful. Thank you. Thank you, Zuzanna. Hello, Zuzanna. It's Cyrille speaking. When it comes to the consumer, what we have seen in the past two years, first have been, you know, a very strong growth. It was two years ago on Chinese customers domestically and lately also with American customers, whether they buy in the United States or in Europe. Since the last year, we have seen basically a coming up also of customers from Japan, from Korea, Singapore, Thailand, Australia, so basically everywhere. In age group, we have seen also across the board and an increasing trend from young customers to buy expensive pieces. Basically with the buying customers tendency to go upmarket, we see on strong products and brands, so ours, but not only ours, waiting lists on key products or on limited edition or launches. This has been basically in all countries. We see more, yes, trading up and then increasingly young customers coming in on our radar. This has been also visible, I say, in new developing areas, and I mentioned so. Southeast Asia, Middle East, Far East. Coming back of Japanese customers, very sharp, from this year. We see not only that for watches and jewelry, but also across other categories. If you see the result of key players in the market, I guess some fashion accessories are also doing well. The key is more to have strong brands and Maisons compared to the others. It's not only for watches and jewelry, but watches and jewelry are doing pretty well. Jérôme Lambert speaking for the half. How was the last weeks after the half. What we can see here from the end of September is very strong trend in retail, two-digit maintained. We see it in many geographies, as we highlighted as well in the report, and it is no change. While China is still under pressure, we see a very solid and strong development in many other continents. Burkhart highlighted Japan, tremendous strong trend, Middle East or Southeast Asia, Europe. It's broadly on that. That said we know that we are meeting in November and December, very strong comparative ahead of us. And that's what we have to see. I think it's a very good point, Jérôme, that you make. Remember, our Q3, which is the Q4 calendar year, is not only in general terms our biggest selling quarter, but also we've had very strong growth across many of the geographies that are still performing well today. We're running against tough comps here. As Jérôme said, broadly in line, but with a normalizing trend due to higher comps, you know, after the close of our second quarter. Good. Excellent. Thank you very much. Thank you. We can move to the next question, please. Thank you. The next question comes from the line of Louise Singlehurst with Goldman Sachs. Please go ahead. Hello, Louise. Hi. Good morning. Morning, everyone. Morning, Louise. My question is, did my- We can't hear you very well, Louise. Can you hear me now? Is that better? Yeah. Yeah. Now it's better. Can you hear me okay? Great. Yeah. Thank you. You must all be absolutely delighted with the performance in the first half, so thank you for taking my questions. Two follow-ups for me, if I could do. Just on the margin point, Burkhart, I suppose the key question is just to double-check. I think I know the answer from the commentary that you've given, but is there any particular phasing of costs from first half into second half? It sounds as though there was quite good cost control in the first half, but any particular projects we should be aware of going into the second half? Or we think we're back to a normalized phasing, just to make sure it's a normal path seasonally, first half, second half. The second question was a follow-up to Cyrille, if I may, on the cohort, particularly at Cartier. Are you seeing a slowdown in the number of new customers coming on board? Is it more of a point of getting a higher spending within existing customers? Or any points across the regions or category that you can call out between the watches and jewelry side? Thank you. Yeah. Louise, Burkhart here. On the first question, nothing to flag up at this point in time. On our side, so we don't see a slowing down on the range of new customers. We see across buying trends for both new customers and young customers and existing ones, so there is no change in there. Great. Thank you. Could I just ask a quick follow-up on pricing? The 4%-8%, can you just remind us where you are in terms of the regional pricing differences? I know that you always try to have a global price policy, but given the move in FX, is there more scope for price increases, I guess, in the obvious place being Europe? Thank you. It's Cyrille again. We try to stay within the bandwidth about 0%-5% on pricing, before tax, with the currency move tending to be slightly higher than that in the United States and in China. When we do price increase, we take into account the natural price differential coming from currencies as well. Meaning not to have necessarily all across, but mostly in the regions, of course, with a European base, and then to see, depending on the country and currency, how to adjust in the best way possible. Louise, remember we always target a very tight band around the either European or Swiss, you know, anchor points for prices. It's been more challenging. Recently ... the last 12 months, or six to 12 months than in previous periods, but we still stick to that pricing philosophy and apply it. Great. Thank you. Thank you, Louise. Let's move to the next question, please. The next question comes from the line of Charmaine Yap with Redburn. Please go ahead. Hello, Charmaine. Hi there. Good morning. Yes, I also have two questions, slightly different one. Number one is, can you talk about your presence or exposure in Hainan, please? Are you present there? Is it through wholesale arrangements? How big is it? Or just give us a feel and how has that developed after this, the disruptions in August. And then also a follow-up on in terms of the consumer. You talked about newer consumers, younger, but also do you think that this is a reflection of anything that you've done in terms of product, marketing, price points, or do you think it's just like a reflection of the strong brand that you've nurtured over the years? I'm trying to get a feel of if, was there anything special that or changed, materially changed from the product and branding side of things, or is it just a strong consumer? Thank you. Jérôme Lambert speaking. Hainan indeed is a very interesting territory, or has been as well a very interesting territory for its quick growth over the last two years. Having said that, our Maisons are present there through our franchisee and external partner. Here, our exposure is linked to, in this case, the wholesale top line development and dynamic. We always monitor the stock there, so somehow the evolution of the sales will reflect, in this case, the evolution of the sell-out without stocking effect. As you can see as well, the growth in the last quarter and in the whole semester as being more driven by retail and somehow the less important this year of Hainan in our business is being largely compensated by the dynamic in retail. That's what you have already seen during the whole H1. For the time being, we don't see worsen or better trend for the months to come. If there is a place where it's even more volatile in this volatile world, it's definitely Hainan. But it's fully under control, and it has been fully absorbed, as you can see in the numbers during H1. It's Cyrille speaking. Hainan had been strongly developing and it's a priority of the Chinese government, and infrastructure both in Sanya and Haikou in the north. There are many developments of mall. In the midterm, it will be one of the important trading areas with also free trade agreements between the rest of mainland China. We continue to invest mostly indirectly because cannot have full license now in both Sanya and Haikou, and in the short term remains volatile, but probably would be one of the area to open first and probably will resume trading quite rapidly when the anti-COVID policy softens. That's just for Hainan. It will remain a long-term growth and short-term volatile move. When it comes to the overall change in customer base, there are two things. Of course, the old element to doing some global rebranding exercise that we did in the past five years have borne fruit, and so being well in demand for younger customers. Overall, and thanks to awareness and development of social media, we see an appetite from young customers to expensive products including watches, for instance, very early age to complications and so forth. We see that for us, but also our colleagues in the watch division. There are two factors, of course, how the brand itself can be demanded and relevant for young people. On that we do pretty well. On the other side, the appetite for young customers for sophisticated pieces and that they are looking for. We see, especially Middle East, in China now also in Korea, where young customers go for pieces that we would expect them in the past to come later in their life cycle. To confirm what Cyrille says, for the other watch colleagues, there are strong growth in the last 12 months is primarily coming from this younger generation in the new geographies with this new multi-local approach. Indeed, it's something we can confirm. Thank you. Can I just follow up to see, in Hainan, do you mean you are there just in watches or do you also have presence in jewelry, through wholesale arrangements, franchisees rather than multi-brand? The both categories or just watches? Jewelry as well. We have a mono-brand boutique in Sanya, which is dealing everything. It's just a franchise store, but it's doing everything, and there will be new stores coming in Haikou. It's just the same model that is applied by the regulatory environment there. We cannot step out of that. Obviously, we would prefer to run our own retail operations. There are some other areas in the region where travel retail is also operated through partners. Thank you, Charmaine. We can move to the next question. The next question comes from the line of Luca Solca with Bernstein. Please go ahead. Hello, Luca. Morning, Luca. Hello, Sophie. Good morning. Good morning to you all, and thank you for taking my question again. Luca Solca from Bernstein. I wonder if you could give us a bit of perspective on Chinese demand and more with a focus on its reactivity. What we see from our own analysis of in-store traffic is that once lockdowns are removed, consumers come back quite quickly. I wonder if you see any sort of underlying slowdown or macroeconomic related reason to be more prudent about Chinese demand coming back. Is the current performance in China, in your understanding, more related to COVID-19 lockdowns, and if they were removed, then Chinese demand could be coming back rather quickly? The second question is, on what you've been reporting, this morning, that you continue to be alert, on M&A opportunities. I remember that at one point you mentioned that you feel, or Johann Rupert mentioned that he agreed that, in fashion and leather goods, there's a need for Richemont to build scale. I wonder if, M&A could potentially be a tool, to address that issue or if you're focusing now your M&A attention, to the high luxury portion of the market. Thank you very much indeed. I will thank you for the question, Jérôme Lambert speaking. Just for China, sir, it's a very large question in some way. In China, if there is one thing that we've been learning throughout the last, not only three months but thirty years, it is that it's a country where new theories are written every month. So I won't try to write a new one a priori. What I can say is that we see a stronger demand in e-commerce and at a quicker pace since the end of summer. If it would have to give a signal that the demand is in China or present and is strong, it's probably a factor that we could highlight and an element that could bring us to say that without measures linked to the zero-COVID policy, we could bring a potential positive element. You know that travel in China is today very disrupted. Of course, we see a lot China's roads, international tourism, but the in-country tourism or in-country travel is so very important for activity, for retail, for activity into the country, but also for island like Hainan or others where the activity is being very disrupted by the measures. If measures are removed, there will be less barriers to our business, less disruption, and it will ease the business. That's what I would say. Do we read something else. It's Cyrille to add on that. If we would remove the stores that were closed on a like-for-like basis for the stores open, that it will be still in positive territory. We have done a high jewelry event in Shanghai, and those customers who could come were very buoyant and had very good result even compared to previous year. If all the stores would got reopen, we can get the result to be better than what they were. Then can there be some impact on the overall economic disruption? We don't know. We have to see how the softening of the COVID policy brings, if it lasts and how it can come in the next month. We cannot guide on that. We have to see how it unfolds. Luca- Luca. Yeah, sorry, Luca. On your second question, I mean, I can't really be helpful here. You know, I can only say, you know, no change in our approach. We monitor, we look at, you know, all the opportunities that might present itself in the market and then, you know, take our view on that basis. Can't be more helpful than that. Fair enough. Thank you very much indeed. Thanks. Thank you, Luca. Moving to the next question, please. The next question comes from the line of Antoine Belge with Exane BNP Paribas. Please go ahead. Good morning, Antoine. Yes, good morning. Good morning. A few questions on China. I think in Q2, Asia was up 6%, but was China negative. Also, you mentioned that negative mix impact from China underperforming. Can you remind us why the growth margins are lower in China and by how many points? Finally, a question maybe for Cyrille, because you touched upon China reopening internally, but what would be, in your view, the consequence of Chinese traveling again in Europe and the rest of the world? Is it pretty neutral for you because you tend to have the same price and it would be just a transfer of consumption? Do you think that for some reason it would lead to, you know, more spending from the Chinese overall? Thank you. Yes. Antoine, let me just try to tackle the first two questions. First one, China in Q1 was highly negative, around 30% down. In the first half, meaning our second quarter, China was up 9%. This is at actual rates. So if you go back to constant rates, actually China in the second quarter was flattish. Very, very low single digit actually. Basically on the same level. Now China, we don't break out, you know, profitability levels by market or by major market. What we do have is, you know, we have higher landing costs in China, as we all have. Which over time will gradually lower because, you know, there are agreements, for example, in the watch space over a 10-year period of time to reduce duties. It's a duty-driven impact in this case, positive that we have or slightly positive that we have, on our gross margin, in the first half. The third question on China, if travel restrictions, outbound travel restrictions fall and what would be the impact, let's say, on China itself and on other regions, speculative, but I probably hand that over to my colleagues, either Cyrille or Jérôme. Yeah. Just on our historically, when our borders reopen, it brings the demand to a higher level, at least during a period of time. The opportunity of traveling, changing the journey and creating available time for shopping has always a positive impact, at least at start on the demand level. Cyrille? Yes. We can expect this to restart first in Asia. Chinese are traveling to Hainan and Hong Kong and Korea and Thailand and Japan. This probably will create a positive move. Europe will come probably later. As far as then if the Chinese economy, which has been kind of a constrained, then has to re-expand, and then this expansion will create a global demand and it will increase. Difficult to know which part will be in domestic China, will part be just nearby. We can expect the Chinese customers to grow, especially if the renminbi remains high, which is quite likely for the time being. Yeah. This is actually just kind of expressing our view based on, let's say, past experiences, right? Travel has slight net increase of purchasing. Secondly, regional tourism has been very much the focus of our mainland Chinese customers pre-COVID, meaning Japan and you know, the other geographies. In a way, the near abroad for mainland Chinese customers. Hainan is a completely new dimension now compared to three to five years ago. That we'll have to find out together. There might be a higher proportion of sales that remain within China. We simply don't have these data points yet. That needs to be proven. All of that is on the assumption that at one point in time, zero-COVID policy in China is weakened and international travel, both outbound and probably for business purposes, inbound is lifted or improved. These are a lot of what-if scenarios. Obviously, we discuss them. Obviously, we are prepared for that. Today, the growth that we have over the last 12, 18, 24 months is mainly driven by local customers. We see a very strong shift in Europe. We see if you look at the performance of Japan, for example, right now, it's almost 100% driven by local customers. Tiny bit of travel coming in, but most of the performances you see are driven by local customers. Okay. Antoine. Thank you very much. Maybe one slight follow-up because so if you're quite bullish about you know Chinese travel internationally doesn't cause it to sort of cause a sort of issue on the way you will maintain the good experience for the local consumer in Europe. Because in Europe for instance I think your sales are now back to normal without Chinese. Yeah they're probably going to be a bit of an issue about the traffic in the store. Antoine, just one disclaimer here. We're not bullish. We're just saying what if, and what if COVID, zero COVID is weakened or abandoned as a policy, and what if Chinese, mainland Chinese customers travel again? This is what we have observed and experienced in the past, and this is what, based on current knowledge, we would expect to happen in terms of flows again. We have not expressed our view on a quantum of it, et cetera, et cetera. Let's just be very careful here. We're still in a very early step, you know, with the measures announced this morning. They are weakenings. We don't know what the impact can be. We'll have to find out. if to add on that, let's say the Proximity move will probably go faster. For the rest, you know, to come to Europe, the Chinese visitors need to have visa, and they need to have also travel agency to have the license to move and to book the capacity. Usually when things reopen, there is at least six months before things can really materialize. As you probably know, the airline company and airports, many have also problems in addressing volumes and number of passengers. Again, many of the aircraft also have to re-expand their capacity, and then the hotels as well and many. There will be a part where the things will redevelop mostly close to China and then probably to Dubai and then probably later to Europe. We'll have time to see how it comes. It will not come overnight. It cannot because of visa, because of airplanes, and because of travel agencies. Thank you very much. Antoine, we can move to the next question, please. The next question comes from the line of Rogerio Fujimori with Stifel. Please go ahead. Oh, hi, Sophie, Burkhart, and James. I have a follow-up on the jewelry Maisons and the specialist watchmakers. For the jewelry Maisons, what is the magnitude of the contribution to growth we should expect for the full year from the increased retail space based on H1 and the pipeline of reopenings for H2? I can see in slide 43, four internal, for Cartier, six, Internal openings for Van Cleef in H1. We are aware of the big flagship reopenings recently, and it looks like the U.S. is a big priority for the company. If you could elaborate on that, would be great. Then on specialist watchmakers, I think you recently disclosed that Vacheron was approaching EUR 1 billion revenue mark. Do you see actually the high-end watch Maisons like Vacheron outperforming the more aspirational watch brands like say, Baume & Mercier or Montblanc? Or has the performance been uniform across price segments? Related to this high greater scale in specialist watchmakers, is the mid- to high-teens% still the long-term margin potential for this division? Thank you. I will first answer, so it's Cyrille. Have to realize that our retail network has been very stable for the past four, five years. We have gone through a full renovation program, and we reopen. There are some relocations, some scrap and build policy, but overall, there is not kind of a geographic expansion which is so massive. We think in the coming months of future, there are some areas where we need a little more mini store, but not so many, and it will not come so much in the next half. The growth is more organic growth of demand developing. Fortunately also, the renovated store are well received by our customers, and they perform well. It's not a question of expanding the network, it's just organic growth. On the other jewel Maisons, I think it's probably similar, even if Van Cleef had a very compact network and probably is expanding a little bit more. For the rest. Sorry, if I might just step in quickly. I fully agree with what Cyrille said. For Cartier it's more a scrap and build with a very slight extension. Van Cleef is, I would say, finalizing their footprint over the next few years, where they have some stores to open or geographies to cover in Europe. Third Maison, Buccellati is a very different story, very different phase of their growth cycle or expansion cycle, where we actually have opened some stores in China and Southeast Asia, first store in the Middle East, to actually cover white spots. We're really in different phases of the life cycle here. Jérôme Lambert speaking. When it comes to the specialist watchmaking Maison, we have more than one Maison that have a large size. I won't comment that information that you mentioned saying one Maison is closer to a certain level of turnover. What I would more tend to say is that we see growth in a large number of Maison within the specialist watchmaker. It more link to other factors than just size. One common between all of them is to be multilingual. If you build your dynamic on more than one territory with the volatilities that we know these days, you have better chance on a long-term period to benefit from the fact that China, U.S., Middle East, Europe can have differentiated growth trend. The second factor is definitely the capability for this Maison to accelerate their direct-to-client dimension. Some of our Maison has very quickly accelerated their direct to client approach. You have in our in the appendix of the presentation of today, the boutique and the evolution of the boutique per Maison will give you a good reading of who through that can have a quick growth. As you mentioned, Baume & Mercier, the Maison has been quite active, quite strong in its growth rates this year. All right. Small size, the small scale, but the iconization with the Riviera is quite successful. At their own scale and then their own contribution, they are not below the trend that we see with the others. It's more multilocal or more DTC and more iconization and the strength of this iconization are that create differentiated growth. Size is probably less of a matter, particularly in a year like this year with the volatilities that we have around. I agree. Rogerio, your last question, let me just remind you what I said is that midterm, you know, we said we see there's a potential to go from, you know, from a range of 17-20, you know, to go to the higher end of that range. But, and you know, and then we'll take stock and we will, you know, have a look at what we believe is the right level of investment that we need to put into these Maisons and where it will bring us in terms of operating contribution. And that might well go above that level. As Jérôme was saying, or as we have said over many years, we are building the Maisons for the long term. We have to invest consistently into our Maisons so that we are able to build brand equity. That starts with a product, and that continues across the quality of our distribution, be it physical or digital. Because only strong brand equity with strong products will drive top line and actually pricing power. And that is what the Maisons have been doing in the watch space over the last five-six years. It was painful decision to buy back the inventory to address quality issues in the distribution network. As we said in our presentation, we believe that both watches in the specialist watchmaker division at Cartier, which were facing the same challenges, that these strong actions that were taken and the very consistent and disciplined execution of the strategy ever since has led to a strong enhanced brand equity. Iconization of product lines drives desire and demand for these watches to higher levels. That is what we've been experiencing, reaping the benefits of past decisions over the last few years. This transforms today into enhanced operating contribution. You see the numbers for the half year. Obviously, for the full year, they won't be at that level. As we know, we have a strong investment cycle in the second half with Watches and Wonders. We have, you know, higher communication spend in the second half. Directionally, we are seeing that we have rebuilt operating contribution, and we expect that to continue. When we reach the 20%, we'll have another conversation. Thank you, Rogerio, and thank you, Burkhart. We'll move to the next question, please. The next question comes from the line of Carole Madjo with Barclays. Please go ahead. Hello, Carole. Good morning, Jérôme Lambert speaking. It's a very interesting question because there are many models around as you know well, and then you have Maisons today out of Richemont that are only wholesale. Or at least there is one big one with a crown in its name that is quite known. You have Maisons that tend to be completely retail or pure like AP, the APs, or the Richard completely. Completely if you take a Richard Mille Maison, in this case. And within our portfolio as the brand Maisons, we have the different models. There will always be one limit, which is in certain territory we don't have subsidiaries and we have a presence, and it can. It's a franchisee shop with a partner. There will be most probably always a remaining 5%-10% for most of the Maisons that will remain structurally in terms of business. Is there a limit to retailization, which is internal shop, external shop for certain Maison? No. For certain of our Maisons, their distribution will be quasi exclusively mono-branded, because from their side, from their exclusivity, from the service that they need to give in terms of scarcity of product, monobrand shop with partner or internal boutique is the best solution. Not to forget that the digital penetration is progressing as well for the specialist watchmaker, and the growth rate in digital sales or in e-commerce for the specialist watchmaker is very, very strong. A very large two-digit. It's still a small penetration rate, but it is very, very strong. I would say for certain Maisons, no limit comes to this retailization. But that said, for many of the Maisons we'll keep a hybrid model, and we'll keep an approach where we'll have internal boutique, franchisee, and multi-brand. Because they have a very large number of clients, and they have quite a spread of that clientele in many, many large territories and geographies. If you take the U.S. and you take a Maison like IWC or Panerai, we want to give a good service of our client all through the U.S., and we have excellent partner to make it. Therefore, we'll have as well external boutique next to our internal boutique and in certain geography as well, some remarkable and very strong multi-brand shop. Here again, the channel is not the driver for us. The driver is always the client. For certain Maisons, the best way to get to the clients, the best route to the end client, is not always the direct one. That said as well, we opened a flagship boutique with IWC in Zurich, more recently in Dubai, and they have an amazing commercial activity. Besides that, some of these boutiques has yearly traffic that pass the hundreds of thousands of visitors. The impact that you have in terms of bringing new clients to your boutique, explaining your world and your environment at a scale which is five-digit in terms of end client or end prospect or people being interested in the product, it's unique. That's what DTC can bring as well, and what DTC brings as additional source of growth for Maison. Okay. What's on the question of pricing? When it comes to the pricing before December, which is not a good moment to change, but after that we will act if necessary. You know, there are some inflationary trends and the price of gold, which is also priced in dollar and diamonds, and then the overall inflation of cost of goods. Also have to bear in mind a lot of our cost of goods is in Swiss franc, which is pretty strong as well. If we need to increase it again, we might. We'll see in the coming three-five months. Thank you. We can move to the next question, please. The next question comes from the line of Thomas Chauvet with Citi Research. Please go ahead. Good morning, Thomas. Good morning, everyone. Good morning. A few follow-ups, please. Firstly, on the US consumer, I think in the media interview this morning, Cyrille, in your article, was quoted as saying the US consumer was slowing. Are you seeing a bit more volume pressure in entry price points, which is, you know, what some of your fashion peers are experiencing? I think Cyrille mentioned earlier there was trading up towards higher price points. Secondly, last month, one of your shareholders requested for Chairman Johann Rupert to elaborate on the succession plan. Johann Rupert discussed this in a press interview to Finanz und Wirtschaft. I guess you don't- We can't hear you, Thomas. Thomas? Thomas, we cannot hear you. We could not hear you know, for the last few minutes. Can you repeat? The second question was such a pleasurable one. Sorry. Is that better now? Yes. Yes. Your voice come through. Yeah, we can hear you now. I'll repeat the second one. Sorry about this. Last month, one of your shareholders asked for Johann Rupert to elaborate on the succession plan that he referred to in a press interview to Finanz und Wirtschaft. I guess you don't intend to respond to that request and Johann Rupert's not here today, but is there anything you want to add to that? Just to follow up on pricing, sorry, on the profitability of the watch category, can you comment whether category watches were more profitable than your specialist watchmaker business in the first half? Is that now a reflection of, you know, scale, higher DTC penetration, maybe the share of quartz watches in the mix? Thank you. It's Cyrille speaking. Don't get me wrong, I didn't say that U.S. customers were slowing down. It's the growth rate has been, and Burkhart mentioned normalizing, meaning you still double-digit growth on high comparable. The growth percentage is a bit softer than before on high comparable. It doesn't mean the customer is slowing down. They are not. They continue to grow. They grow in the U.S., and they grow also in the rest of the world, where they have been very buoyant, especially in Europe. In terms of a so-called quote-unquote "enterprise product," we don't see any pressure, meaning that all categories have been growing and we have even facing some shortages in some products. There is no, I think big differences in our product category. We are in the fine jewelry segment and we're not in silver, we're not in. Price point that might have different kind of customer base, but we don't see that. Okay. Sorry, Thomas, on the second question, you're right. We do not have a comment to make on that. Third question, sorry, can you remind what you said? The profitability of Cartier watches compared to the other Swiss watchmakers. that we don't break down profitability. Having watches and jewelry which are strong means it's been profitable on both sides. We don't make breakdown by product category. No. Okay. Thank you, Thomas. Thank you. Thank you. We can move to the next question, please. That will be the last question I think, given the time. Maybe two more. Alice, can you bring the next person in? The next question comes from the line of Patrik Schwendimann with Zürcher Kantonalbank. Please go ahead. Hello, Patrik. Hi, Sophie. Patrik Schwendimann, Zürcher Kantonalbank. Good morning, Burkhart. Good morning, Jérôme, Cyrille, and James. A question maybe for Cyrille, what do you think is the current percentage part of branded jewelry, and how much was it two years ago? That's my first question. Second question, the global luxury consumer still seems to have enough money to spend. What do you think are the reasons behind that? Thank you. The difference between jewelry and watches is that we have less kind of a global view on the market, because for watches, luxury watches come from Switzerland, and there are some statistics of Swiss export. We can measure quite well their market share. When it comes to jewelry, many things are not so visible, so difficult to draw a global picture. It's safe to say that branded jewelry overall would be at 20%. The more we come to the part which would be more kind of a fine jewelry, it's higher because many players are producing some kind of cheap products. You have to see also whether you consider some brands as branded or not, especially in China, whether you consider Chow Tai Fook, Chow Sang Sang, Luk Fook, the part of their activity, and that's quite difficult. In Japan, whether you consider Mikimoto and Tasaki, probably yes. If we consider Yondoshi or Vendome Aoyama, probably no. It's a bit difficult to draw specific lines in there, say what it was two years ago and what it is now. What we see is the attraction for branded jewelry is growing and growing basically everywhere. We don't have formal statistics that we'd say we can measure them precisely. Thank you, Cyrille. Thank you, Patrik. I think we can move to the next question. Which was it? The next question comes from the line of Reyneke van Wyk with SBG Securities. Please go ahead. Hello, Rey. Good. Good evening. I'm glad that I've made it kind of here now. Very nice. We're in Australia. I'll be there in two weeks. Wonderful. Just a quick one. On the online sales growth was 9% as opposed to the group sales of 16%. So that lagged. Also if I tied it with the expansion of brick-and-mortar stores, am I reading it right between the lines that you are probably getting a bit more optimistic again of brick-and-mortar versus online, or is this just a temporary situation? Jérôme Lambert speaking. Thank you for your question, particularly at that time of the day for you. Just one thing to keep in mind are you have and you're close to geographically. In China in March and April, partly May, we had this year a very severe disruption of all the supply chain. Digital penetration is important in China, and China is an important territory. In the percentage, the performance is also reflecting these weeks of quasi interruption of e-commerce. In proportion, China is more important in e-commerce than retail, brick-and-mortar retail of China in the absolute total. Here you have a distortion created by that relative importance. When it comes to digital extension, I think that. Well, not only I think. What we have been investing this year in the development of our call centers around the world, in the different continents, is showing that we remain very active into creating this new route to client, more hybrid than ever, where direct contact with people from our Maison in brick-and-mortar or through the phone is important, or more system sales throughout all what have been built recently and will be further built with Farfetch for the future. Here I would tend to say that we remain quite equal and quite balanced in the approach, but we do believe 100% that it's very strategic and crucial to keep investing in the new route for clients. If I might add to that, I think it's also just a market or customer reality today, that we're still a bit in a reopening phase. You know, we spoke about Japan. Once you're able to serve your customers in your stores, you have a very strong increase in store traffic, and I'd say, normalization of traffic in your online stores. If you look at external reference points, you know, the online distributors, they all have had a boom in the first 12-18 months of COVID and have in the last 12 months, seen a return to much lower growth rates. Usually, if you look at a revenue line somewhere in the low- to mid-single digits, which is the current, you know, growth rate across most of the online distributors. That means, yes, there is a trend back into stores. Obviously, we then have markets that are disrupted, like China, where we see, you know, through rolling lockdowns, where we see that online is actually performing stronger. It's really that dynamic that is playing out. The nature of the retail store engagement with customers has changed a bit over the last 12-18 months. We have many more appointments which actually drives the transformation into sales rate much higher because actually the customer treatment is enhanced. It's prepared. It's suited to the customer's needs. The product assortment is targeted. So customer has, let's say, remunerates that with a much higher transformation rate into sales. But the digital or the retail, you can look at it from two different perspectives. You can see it as separate distribution channels, or you can see it as one distribution channel, and it doesn't really matter where the transaction happens. It is purely the customer's choice. Our, in a way, that's our conviction is that we have to build this multi-stakeholder ecosystem around the customer, and then the customer chooses at which given point in time he or she will transact in a physical store or in a digital store. We really see it as one channel. Excellent. Okay. Thank you. Thank you very much. Thanks, Rey. Thank you. Have a good night's sleep. Thank you very much. Thanks. Well, I think it now concludes our Q&A session. Thank you very much for your participation, and we look forward to speak to you very soon, and obviously in the meantime, to read your analyst reports. Have a good day. Bye-bye. Thank you. Thank you.