Get, get cracking. Delighted to welcome Nestlé to the Barclays Consumer Staples Conference. François-Xavier Roger, Group CFO of Nestlé and previously, EMEA, North America. So it's a fireside chat format and there will be a breakout next quarter, so please do join us at the end. Welcome, gentlemen. I think we're gonna start with you, François, on the topic of real internal growth. We've seen well mix negative last few quarters. You sounded confident about it turning positive in the second half. Would it be more Q3 or Q4 weighted? And can you maybe explain the building blocks behind your confidence about the back half? And then, you know, looking forward, can we get back to the, you know, the, the, the, you know, 3-4% with internal growth in, into next year? What needs to happen to get into that kind of zone? Okay. Good point to start, Warren. Clearly, in H2 2023, we are at an inflection point after two semesters of negative RIG developments. Part of it last year was linked to high comps in the previous year, and part of it is linked to this portfolio optimization program that we have embarked upon about a year ago. We expect indeed to be back to positive territories as far as RIG is concerned for H2. Mm-hmm. I'm not saying for Q3, because Q3 has 1 less trading day, so it could have obviously some minimal impact on the downside. Positive RIG development expected in H2 this year, driven by four main reasons. The main one, one of the reasons is obviously the fact that we have easier comps last year. Then we have not done a lot of pricing since April, actually, and we don't expect to do much pricing going forward. Maybe on a selective basis for some categories, but we still see some input cost inflation, like for cocoa, for sugar, for robusta coffee, for example. We are raising investments for A&P in H2, about 100 basis points more than in the same period of last year. And we are starting to get the benefit of this portfolio optimization program. The idea is really to redirect the resources that we have spent on low margin, low rotation items, and to refocus them on high margin, high rotation items. Which we have seen really very interesting increase of our service levels in the beginning of the year, which should translate in H2 into more positive RIG development as well. So we are confident on getting there in H2 this year, and this is a transition point towards going back to our model, the model that we had before, with mid-single digit growth, which we will get. So the future I can tell you, if it is 2024, 2025, we'll see, with a little bit of pricing, even though we don't value pricing per se, because pricing is a mere passing score of whatever we receive. But, positive volume development that we need to get over time, we are not there yet, but we need to get there. We need to get to where we were before, COVID, which is around 1%-1.5%. And then the largest component of our growth should come from mix. And well, mix has been very positive lately, and has even increased during COVID and during inflationary times. Okay. I mean, back in your CMD in Barcelona, last, I think last November, you said that on the SKUs, it would be 20 basis points accretive to group organic growth in 2023. Is that still the case, or because you're exiting Canadian frozen food quicker, that might not happen? And then the other element is then growing the head or the billionaire brands, which I guess is just as important. Where are we on that kind of... Is it Project Tasty, I think you use, is the code name you call it, internally. But yeah, where are you on the whole picture compared to what you said in Barcelona? So we are really executing and delivering as per the plan. So we are accelerating some of this program, and Steve is accelerating the exit of Canada Frozen. So we do expect to deliver this 20 basis points. I don't know if it will be exactly 20 basis points, because, you know, as part of this positive benefit that we get from this portfolio pruning exercise, as I said, we have seen a significant increase of our service level, which is very good news, but it's coming as a consequence of some other factors as well. So there is an improvement, for example, in transportation, shipping, availability of raw material, packaging material, which may help a little bit and contribute a bit as well in that. As far as the saving program is concerned, this Tasty program, where we have taken out about CHF 1 billion of cost last year, it will be the same this year. So we are really progressing extremely well with this program. It will continue for a few more years, maybe not to the same extent, but we continue to be very active in that space. I'm not. I would not focus too much in this program, Tasty, on, you know, the SKU rationalization, the cutting the tail, as we say. We have done that it well for years. I'm less interested in that. I'm much more interested in the growing the head, where we redirect these resources to improve our service level, to really support high volume, high margin product. This is really where we can generate much more value than cutting the tail, which always happens anyway. Okay. Mainly into advertising spend, because you've now disclosed it separately, so obviously it's a focus for us. You've said that you're going to increase spend by more than 100 basis points in the second half. That's a pretty big jump. Can you tell us a little bit about where that spend is going to go, what innovations you're looking at to really get behind, and what kind of returns do you expect on that uplift in terms of RIG? Okay. So we value A&P- Mm-hmm. As a good growth factor for the future, we were at a very low level last year, of 6.9%. By the way, we have started to disclose the amount of A&P since the beginning of this year. So 6.9% was clearly a low level, given that anyway, we were-- we had some supply chain constraints last year. So there was no point in advertising for some categories like pet care in the U.S., in Europe, like Coffee mate, like Perrier. Since we had capacity constraint, there was no point in advertising for products we could not sell. So clearly, 6.9% was too low a level, so we started to really ramp up our investment in Q2, and we expect to increase our investment by about 100 basis points, certainly behind innovation. I mean, a lot has to do as well with brand building. We'll be working on the brand personality, brand attributes, with some benefit that we would get in the short term, but since a lot of it has to do with brand building, I mean, we will see the benefit as well over the medium term. So we will continue to increase our marketing investment further than the second half of this year. We expect to go back to where we were a few years back, which means that we will need to ramp up even further the investment in 2024 as well. Just one thing as well is that we should not look only at A&P on its own. So we look at A&P and trade spend, and I'm talking of performance trade spend, which is everything that goes to the consumer, excluding discounts that go to retailer. So the total amount, the total consideration for A&P and trade spend is close to CHF 30 billion, so it's a huge amount. By the way, last year, we did increase that amount in absolute value. We decreased marketing, but we refocused a little bit more on trade spend at a time when we did an exceptionally high level of pricing, 8%, after basically 15-20 years of no pricing or deflation. We thought it was very important to make our products more affordable and more accessible. As a consequence, we focus more on trade spend than on marketing. This year, in terms of trade spend, we have increased again, a little bit less, but a bit in absolute value, still in H1, and we will increase our trade spend for the full year 2023. Okay, and so moving on to gross margins, because you're out there saying the gross margin at some point will return to 50%. In the second half of last year, it was 44.5%, so that's 550 basis points, which is a massive increase in gross margin. I think there's a bit of confusion out there about, you know, your cost base, although it's coming down a bit, it's still quite elevated, but you're still saying that it's, there's a big jump in gross margins. Some people are having some issues triangulating that. Are there other elements outside of COGS, which are helping? I'm just trying to get a sense of, you know, your big cost buckets on dairy, coffee, cocoa, wage inflation. How do we actually get back to that 50%, and how quickly? I know you don't think it's a year, but some sort of sense would be, would be helpful. To try to help you, let me give you a little bit of picture of the situation last year, actually. Last year, we did receive about CHF 8 billion, Swiss francs of additional cost in terms of raw material, packaging material, transportation, energy, salary, and wages. It's big. Even for a company the size of Nestlé, CHF 8 billion is a lot. By the way, we passed on to consumers CHF 8 billion of pricing, but that led to 160 basis points of gross margin decline last year, and 400 basis points over the last two years. This year, in 2023, we are still receiving a few billion of input cost inflation. This is less than what we had last year, but still a few billion, largely front-loaded in H1, which means we will have less in H2. But already in H1, you could see that because we had still a reasonable amount of pricing, partly, that we see from last year as well. But so we will have more pricing than input cost inflation this year, which means that our gross margin will start to increase, which has already been a reality in the first half of the year, where we have increased, in H1 2023, our gross margin by about 120 basis points over the second half of last year, and it will continue increasing in the latter part of the year. So if we look at it, it's far too early to talk about deflation. Once again, this year, a few billion Swiss franc additional cost. If we look at our agricultural commodities, the baskets for Nestlé, it went down by about 25%. Today, it's about 25% lower than the peak of last year. And you see from the peak of last year. But it is still 30% higher than the average last five years. So which is, and it's still 40% higher than where we were back in 2019. So it's certainly not the time to talk about deflation price decreases because of the significant decrease that we have seen in gross margin, we start recovering, and the fact that we still see a high level of input cost inflation. By the way, we still have some items increasing, like sugar, like cocoa, like robusta for coffee. So it must be certain items that decline, like energy, like transportation, but net-net, still a few billions up in terms of input cost inflation in 2023. Okay. And Steve, maybe turning to you, can you discuss a little bit, in general terms, where the U.S. consumer is, especially in light of housing costs, you know, changes in student loan repayment schedules? We're hearing a lot about that in the U.S. We've heard some other U.S. food companies talking about consumers hunkering down and being careful on food waste. You know, where are we seeing pressure points in your portfolio? What trends are we seeing kind of by channel, you know, private label? Can you just maybe set the scene of what you're seeing on the ground, with regards to the U.S. consumer? Well, look, the U.S. consumer has actually been far more resilient than I think anybody thought they were going to be. And so as they've come through this incredible wave of pricing and inflation across every single part of their spend, right? Whether it's housing or fuel or whatever it is, and the spending levels are maintained, employment stays good, wage growth is okay, right? But overall, they've actually been pretty stable and very resilient. When we look at it, though, we're starting to finally see where all of the final COVID subsidies, the SNAP reductions, the student loan repayment programs coming off to where the market will actually have to rebalance in terms of real income in the wallet versus consumption. And so I think there'll be a little bit of adjustment. You see that the big population states came off April, May, in terms of the final kind of COVID extension of subsidies. And you see it takes the consumer a little bit of time to adjust to that. But overall, I would say the consumer's been incredibly resilient the last couple of years, and has managed through this inflation wave very, very well. And when we look across volumes in North America, it's held pretty stable. Some of our big categories like pet, coffee, creamer, actually have grown volume through this entire period. And so whereas you move down the kind of socioeconomic chain, you see more impact. Obviously, the inflation's a bigger part of their overall wallet, so you see higher elasticities in categories like frozen or frozen pizza, where the—it's more of a middle-class consumer that really is more impacted by that. So, but I think across the basket, the consumer continues to actually surprise to the upside. When you think about private label, clearly, there's been a regain of private label share over the last, you know, 12 months or so, but it's really been just kind of recovering what they lost through COVID. I think there was a move to brands, whether for trust, or for safety, or quality, whatever drove the consumer sentiment to push towards big brands through COVID, and you see that come back. And, but it is stabilizing. Actually, we're starting to see that actually flatten out. So I think we'll move into 2024 with a consumer that's worried. You know, the one that worries me the most is the sheer cost of housing and the impact of that to the broader consumers. I think the cost of ownership has actually doubled the cost of rent, with approximately 10% in our part of the country and 15%-20%. So that challenge, I think, is still to be absorbed and understood as we look across the consumer. Maybe can we dig into some of the U.S. categories? I do want to touch on U.S. frozen. We heard some more positive comments about market shares in the last quarter. Could you elaborate how some of the big brands like Stouffer's and Lean Cuisine, and Hot Pockets, DiGiorno are doing? Can you get U.S. frozen role mix consistently back into positive territory? And this whole shift out of Canada into U.S. on service levels, is that already starting to make a meaningful difference in terms of the U.S. frozen economics? Yeah. So the... I'll go to the Canadian decision that we made to exit. It was really around what is an ability to win and what is the part of the category that creates value for us, and a focus on the big businesses. We were about 90% service on our frozen food business in the U.S. for most of the last three years, and so the ability to exit that business and then put those manufactured cases into the U.S. business has actually been great. So now, if you look across our frozen platform, we're actually at, you know, 98%-99%, where we wanna be from a service standpoint. And it, you know, it's just from a cost standpoint, to manufacture in the U.S. and distribute in Canada is a tough economic model with the currency. That decision actually has enabled us to focus. But when you look at frozen in general from a share standpoint, Stouffer's is actually positive year to date. Lean Cuisine is positive. You know, the category is coming down, but when you look at the category, you know, you had a massive ramp-up in kind of what we call an at-home revolution as you moved through COVID, and you actually shifted. If you take total food and beverage occasion, and you say, "Look, 80% of those, or historically, 78% of those were in home." That went to 83% in the peak of the pandemic. You've actually still held half of that. So that 5-point growth, you still have 3% of those occasions still fit in out-of-home. So as you come down, the volumes are higher than they were four years ago. I think you get a little bit of rebalance as out-of-home recovers and you come back. But the ability to drive these businesses there, it goes back to the same thing: you gotta drive relevance in new brands, deliver great quality for money, and for a lot of those portions of the segment, they tend to be more mainstream, so value becomes a much bigger part of the equation to drive growth. And they play a different role for us in the sense of the portfolio. They're never our high growth, high single digits other than in the pricing growth, part of the portfolio, but they're very high ROIC businesses, and we actually really focus on to help fuel the big growth drivers like pet, coffee, creamer. Can I talk about US pet food? Yeah. There's obviously been some competitive comments about more cautious tones around either trading down or, you know, pet adoption rates changing. Can you maybe address that? Are you seeing at Nestlé any of the same challenges, or is your issue still one of capacity, issues? And where are we on kind of US pet food share? And we can see the scanner data, but it obviously cover e-com, which is a key channel. And what's your outlook for US pet food role mix as pricing begins to kind of roll over? Thank you. Yeah, for us in pet, where I, you know, it was by far the most resilient category as you moved through all the pricing and all the supply. We've been incredibly supply constrained in that business for the last three years. We're building capacity. Some of it's online now. The new factory comes online at the end of this year. Another one will come online in 2024. And so we still have supply runway to actually catch up on. But when you look at the category, we're a bit unique, and it's actually true across most of our categories in North America, is we actually try to play across all of the stratas in the category. And so take coffee, you know, even if we move away from pet for a second, we go from Nespresso to Starbucks to Nescafé, and the range per cup goes from $1 to $0.05. Even at the bottom end on Nescafé, Nescafé grew 13% last year and actually grew positive RIG. And so same thing in pet, we can move through the entire tier. So if there's trade down, they actually trade down within our family of brands, and we see some of that, but we still see premium actually growing. Our Pro Plan, Purina ONE, and Fancy Feast are actually doing very well and growing on the premium end of that segment. And so for us, we're a little more bullish. If you look at pet population, it's basically average 1% growth for the last three years. You know, it came back down slightly. The good news is, it's, it's a little more dog-weighted, right now, but it's not so much that it's dog-weighted, it's that it's big dog-weighted. So we've all decided we don't want little dogs anymore. We're gonna go big Labs or, you know, Swiss mountain dogs, and, which is good. They eat more food, and so we like that. We like the big dog approach. So you see some of that actually coming into the marketplace that will actually help drive that as well. But, we're a little more bullish on our ability for me to grow that category. It'll obviously come down, like all categories have to come down off of the spikes that it's been through the last, 24 months. But I think it'll still be a very high single-digit category that will continue to drive growth through premiumization and across the category. The fundamental consumer trend of humanization and bringing that pet member into the family gets stronger and stronger over time. François, on the same topic, on pet CapEx, I mean, you're increasing pet CapEx by CHF 3 billion between 2022 and 2024. I think CHF 3 billion is going into the U.S. CHF 3 billion's a massive number on pet. What is the payback on that spend? You know, you spend the money, well, when do you expect to get that money back, how quickly? So as a general rule, internally, we are targeting to get a payback period that's about three years to 3.5 years, which is where we were back into 2019 and 2020. It has deteriorated a bit lately because we saw an inflation for construction material that was significantly higher than general inflation. If you look at most of these plants are, that we are building now in the U.S., the inflation for construction material was 2.2x higher than general inflation. So it led to a slight deterioration of the payback period, which we see as temporary. I mean, well, our intention is to come back to these 3-3.5 years, which is, I would say, a decent target in our industry. Okay. I think if you go back historically, it was actually one of the lower spin rates across our businesses was pet. We actually were pretty down in capital for several years, and so there's a bit of catch-up capital on that too. So it's a bit of a bubble in the cycle. I'm sure there'll be plenty of questions on pet in the breakout. Yeah. But we'll move on to coffee and US coffee. Can you talk about how Nestlé is doing in the US coffee market, particularly how Vertuo is doing? You've obviously acquired Seattle's Best, as well. You know, you got Starbucks. Where's the growth gonna come from in US coffee for you guys over the next 12 months? Yeah, coffee is an interesting category. Vertuo continues to do very well, and Nespresso business in the U.S. actually continues to perform at a very high level and continues to gain household penetration across the market. And so we're very pleased with Nespresso in terms of serving the super premium segment of the category. But again, we have then moved down into Starbucks, and what you see is consumers continue to adopt single pod versions of coffee, whether it's Nespresso or Keurig, or as they trade down onto the Keurig system. We're the largest pod on the Keurig system with our Starbucks brand, and that business continues to do well. We're growing share in that. But actually, you know, the one piece that kinda suffered a little bit through the pricing code was in roasted ground, where consumers kinda retrenched a little bit on the roasted ground side. But you're starting to see now that actually turn back in terms of positive share territory. Seattle's Best was, you know, it was part of the original license deal that we had with Starbucks, but, you know, to, it's, it's a great brand with great coffee credentials, but needs a bit of reimagination and it being deprioritized for Starbucks as a parent company, Starbucks. And, and for us, we think there's a big opportunity both out of home and in home, to reimagine that brand and, and push those credentials across the portfolio. And then Nescafé continues to be a growth driver. It's been an incredibly strong business for years in the U.S., and it's a very attractive part of the category. We have tremendous network of ensuring supply around the world, and we continue to grow with not just Hispanic households, but also value-seeking consumer households at a very reasonable cup of coffee. Another category I want to touch on is vitamins, minerals, and supplements. You've got the Atrium business in the U.S., you've bought Bountiful with those brands. How is that going? Because there was a little bit of a perception that you kind of bought it slightly on the top of the cycle and, you know, the household penetration of VMS is, has come down, and Nestlé got some quite big targets for improvement in the second half of the year at a global level, but clearly, you know, so U.S. is a big part of that. Are you confident about returning to kind of strong growth in VMS in the back half? And how is Bountiful Atrium doing, just more generally? Let me take that one. Yeah, if you look at the U.S., which is where we have about 80% of our VMS, vitamin, minerals, and supplement market. The market increased by volume by about 30% in the course of 2020 and 2021. We were not really sure that we would be able to retain most of it, but if you look at it post-COVID, the market has not really deflated that much by maybe 5% max. Yeah, so frankly speaking, we are very happy to see what has happened in the category and during COVID, we even gained market share, so we have outperformed the market as well. So a little bit of softness, but frankly speaking, we are way above the level where we were back in 2019. As far as Bountiful is concerned, we are in line with our acquisition plan. Mm-hmm. Even slightly better. We had factored in the fact that the market would probably go down post-COVID, which is exactly what happened. I think we have a super brand architecture now. Steve was talking about what we have in coffee with Nespresso as a super premium brand, Starbucks as a premium brand, and Nescafé as a mainstream brand. We have exactly the same within Nestlé Health Science and VMS, more specifically with Solgar and the Garden of Life, for example, that's super premium brand, and then we have the Bountiful Company in the mainstream segment. Then we have Puritan's Pride in the affordability segment. These brand complement each other pricing-wise, exactly as you were saying for coffee. But they complement each other, same as in coffee, because they don't compete on the same shelves. We have different distribution network as well. I think that we have, in my opinion, a very nice positioning on a very nice business. How do you build out the non-U.S. business for VMS? Are you going to kind of roll brands into other areas, or do you see an inorganic opportunity through M&A to try and globalize the VMS platform? We did a little bit of M&A. We made an acquisition in Brazil. Lately, we made this one acquisition in New Zealand as well. That being said, we don't mind making some of these brands that we built in the U.S. to travel. Some of them are already well established outside of the U.S. If you look at Solgar and the Garden of Life, they are already present brands like Pure. Yeah, so the idea is exactly the same as what we have done with Starbucks as well, where, you know, we built that business. It was predominantly a U.S. business with $2 billion of sales originally. Now, we have doubled the business, and most of the growth came from the globalization of the business, given that we can really leverage on our outstanding geographic footprint. So the idea is the same. Let's be careful, though, because I'm, I'm not saying that any of these brands would travel as easily as Starbucks, because obviously, we leverage on the, on the equity of the Starbucks brand. But now take another example, which is Vital Proteins, where we have done extremely well outside of the U.S. already, given that we have doubled the size of the business almost in 18 months after the acquisition. Okay. You've recently sold PALFORZIA this week, the peanut allergy business. You've written it down already. How much does that divestment help you achieve your 18% margin target for Nestlé Health Science by 2025? I think the margin is 13% today. And then can you maybe explain a bit more detail how you're going to use the Bountiful backbone to extract the synergies? Just trying to understand how do we get from 13% to 18%, and how much does PALFORZIA help you? I assume it was loss-making. Okay. So last year, for Nestlé Health Science, we had an operating margin that was around 13%. If we were, if we had not had that PALFORZIA, it would have been more in the 14%. Mm-hmm. And then I'm super confident of the fact that we would get above the 18% of margin by 2025, because a lot of it is coming from cost synergies. Mm-hmm. Let's make a pause with Nestlé Health Science, probably for a few years in terms of acquisition, and let's really extract the synergies, because we bought six or seven different businesses, predominantly in the U.S., with six or seven different organization, head offices, IT system, manufacturing footprint, and so forth. And really, by combining all of this organization, we can get probably very close to $400 million of savings. Mm-hmm. Within the U.S., it's within a single country, within the U.S., which is relatively easy to execute, so I'm not really worried about that, and that will naturally bring us to 18%, which, by the way, should be for a business like Nestlé Health Science, a first step, because they have to go up and up to 20%. Okay. I want to just ask you about confectionery also. There does seem to be a desire to shift the confectionery portfolio away from kind of mass market, sugary products, maybe a bit more towards gifting, a bit more towards premium. Can you— Oh, you got Kit Kat, which is a great brand, right? We all know that. But outside of Kit Kat, can you, how do you actually address those growing segments? Can you do that organically, or would you consider inorganic moves to try and position yourself more premium in confectionery long term? For confectionery, like for other categories, we always prefer to do it organically. Mm-hmm. I think we have a good platform with Kit Kat. Yeah. If you look at it, when we bought that asset from Rowntree's, what, 30 years ago? It was present in eight countries. Today, it's present in 80 countries. It's the second largest confectionery brand in the world with our partner in the U.S., which is quite impressive, what we have done. And I think that the brand has been really stretched and really well premiumized. So we always favor organic growth. That being said, we don't discount, and we don't eliminate, even for a company, for a category like confectionery, which is a smaller one for us. We, we do look permanently at opportunities. I think we have a duty to look at external opportunities when they present themselves. Okay. And maybe turning to, we're a bit short on time, but two other, two or three other questions. One is on Europe. The real internal growth, I think, most recently was, I think, -4% in the second quarter, and you had a lot of pricing coming through at the end of the first quarter, so I can imagine there was some elasticity. But can you just address the question around which categories are under most pressure in Europe? Where are you seeing down trade in private label pressure, and is there any reason to be a bit more optimistic about the outlook for Europe on RIG and pricing in the second half and really into next year as well? We were actually quite worried about Europe at the beginning of the year because we were having some concern about a possible energy crisis and energy shortage. It did not crystallize, at least to the extent that we were fearing. So indeed, our performance in Q2 in terms of RIG and volume was certainly negative. But it comes, as you know, in Europe, we can do price increases basically once a year. So we did that at the end of Q1. As a consequence, we do more, and for a few weeks, it had a little bit of impact on sales and volume. In addition to that, there were some technical issues with one less trading. There was the timing of Easter and because of our exposure to confectionery in Europe. So if you exclude all of that, we think we are really confident about Europe and the second part of the year, which would be certainly better than what we have seen in Q2. The categories where we have been suffering a little bit more, is categories where we are less premiumized, more commoditized. I would mention two, dairy, to a certain extent, as well as food. So, obviously, whenever we are well premiumized, we are suffering less in those times with significant price increases, because obviously, high-end customers can afford to take more pricing than the mainstream offerings. A question for you, Steve, on plant-based. It's been, again, a bit of a topic in the food companies at the conference. Can you just maybe update us on your views about plant-based meats and also plant-based dairy, and what you're doing in sort of both spheres and how you see the landscape evolving? It's obviously had a big step down. Does it continue going down? Does it stabilize? You know, what's your view? Yeah, I mean, clearly, the plant-based meat analogs, if you just focus on that part, kind of have skyrocket and then, and then a pretty hard fall. So for us, I think there'll always be some market in it. It's more about how attractive is that portion of the market in terms of the meat analogs. So for us, that wasn't really over-indexed actually in our portfolio anywhere. Where we've seen really strong growth in plant-based is actually in our plant-based side, like especially our plant-based creamers. Our creamer business actually is in more cups of coffee than we're in coffee, actually. So the plant-based growth in that have actually developed a multi-hundred million dollar business in a pretty short period of time. So we've seen really strong growth in plant-based on plant-based beverages. But on the kind of meat analog side, I do think it'll settle at some point, and there'll be some portion of the market, but, I think still to be determined how attractive that portion will be from, you know, from an overall margin standpoint. Okay, I'm going to try to squeeze two more in. The other topic that's been quite big in the conference has been the anti-obesity medicines, the GLP-1 drugs, and, you know, obviously, different companies have been asked about it. It's very nascent, but I was wondering whether you guys have an initial view or have some sort of perspective that you can share with us in terms of how it may play out in, in terms of some of your, your categories and behaviors, particularly in- Sure. because it's mainly U.S. I think it's 75% of consumers are female on these drugs. So how would that potentially... Is it a positive? Is it a negative? Is it neutral? You know, are you, are you- Yeah. Are you tracking it? Yeah, clearly watching that. I think—you know, we try to put our consumer weeks stay true north in terms of really just staying focused on how they evolve. Look, I think ultimately, it could be a real breakthrough for what is an incredibly costly disease across the population. So from just a sheer positive result, I think we're very positive on it. I think we look at it actually from the other side in terms of creating opportunities. It, you know, as these drugs in terms of lower consumption needs, there's a real opportunity to actually fill those needs and not partner necessarily directly with the pharma companies on it, but to actually meet the needs of the lower consumption businesses. Like, if you look at lunches, we're actually growing share today on lunches, but that kind of meal is exactly what you end up eating on these kind of drugs. So that's, I think, an opportunity that we see in this business. The second piece is just in sheer healthcare costs. I mean, when you look at your healthcare costs today across North America, it's driven by obesity-related diseases, hypertension, diabetes, cardiac care, and the ability to significantly reduce those through the application of these drugs will have a pretty material effect on the bill. We can deliver the same benefits for actually a lower cost. It probably will take time because you need time to see the health benefit of those. So it'll be a little bit of spike, I think, in the beginning, but ultimately should be a couple of different opportunities for us across the business. I think these weight loss drugs are good, good for society and for people affected by this disease. The impact on the industry might be a little bit less than maybe what some believe, given that the compliance rate is actually relatively low from what we can see already from the usage of these drugs. And you have a dropout rate, which is close to 70%, unfortunately, I would say, because these drugs are efficient and relatively affordable. The other thing is that if it were going to impact the industry, Nestlé would probably be less impacted than others. It's not that we would be immune to it, but we are not that present in what is called the center of the plate, because this is about reducing calorie intake, and we are not really very, very present in the business of calories. If you look at our business, our main business is coffee, not really involved, pet care, not. Infant nutrition, not concerned. Water, not either. Culinary, what we do is not really about calories. So where we are a little bit more exposed is certainly with confectionery, which is a smaller category for us, and obviously, a bit in the U.S. with the frozen and the, and prepared meals. So we are probably less exposed than most of the, most of the industry, I would say. Okay. It's interesting color. And just a final question, one for you, François. Obviously, you have been at Nestlé eight years. Yes. And you, you are stepping down, you're not going to tell us where you're going. But, but what advice would you give your successor, Anna Manz, who's coming in as CFO? When you look back at Nestlé in a few time, a few years' time, you know, when she's obviously taking on the mantle that, that you've had for eight years, you know, what does success look like? Is there any particular observations from your seat that could be, like, a real unlock, advice that you'd give, her? Well, I think we have done a lot as a team over the last eight years in accelerating our growth, improving our margin, really reshaping our portfolio with a massive change in the organization, and, and the company has changed a lot. We are far less capital intensive, far less labor intensive than we were. We have done a lot of work as well in capital efficiency. We have reduced our direct tax rate. A lot of these things is what I call hard stuff, which we can easily measure, and reduce our cost base, for example, as well. Some of it we need to go through, and we need to do more. We do more in portfolio management. We do more in terms of cost efficiency, margin lifting, accelerating our growth, and so forth. But some of these issues will be more difficult to deliver on the same way. So I believe that where the new creation drivers will be in the future is more about soft stuff, which is around digitalization, data analytics. And since we were talking, as part of your first question about A&P, A&P and trade spend, we spend about CHF 30 billion a year. So if you think about it, if we can improve, which we can do in my opinion, we have a very big data analytics and digitalization. If we can improve the return that we get by 10%, it's CHF 3 billion additional, not, not necessarily margin or profit, but that we can really reinvest behind growth. So I think that this is really one of the key growth drivers that we will have to, in the future. I think Anna, coming from a company where data management is extremely important, I think that she's very, very quick to handle that for us. Okay. Thank you, gentlemen. I think we're going to cut it there, and we're going to move into the breakout. So please join us. Thank you.