Welcome to our media Q&A for full year results 2025. Thank you for joining us this morning. This is Christoph speaking. I'm joined by Philipp Navratil and Anna Manz this morning. I trust you have all had a chance to watch the investor Q&A this morning and the presentation, so we will move straight into your questions. But before we begin, please take a moment to review the disclaimer on your screen. Thank you. Now, if you would like to ask a question, please raise your hand on your Zoom feature. When I call your name, you can unmute yourself and go ahead with your question, and once your question has been answered, you will be automatically put back on mute. To ensure that everyone has a chance to ask a question and to contribute to this session, please limit yourself to two questions at a time. Now, we're waiting for the first question to come in. First question is from, Matthias Benz, the NZZ. Good morning, Matthias. Please go ahead. Good morning. Can you hear me? Yes, perfectly. Great. So thanks for your time. I have a question on Nespresso. As Nestlé Health Sciences will disappear as a separate unit, should that not also mean that Nespresso will actually disappear as a globally managed business because it's integrated into the new coffee pillar? And the second question would be, as you now focus more on these four pillars of product categories, will there be new heads for these four pillars? Thanks. Yeah. I'll take those, Matthias. Good, good to have you. Look, on Nespresso, and should that be folded in some way to coffee? Look, no, it's not the case. You know, Nespresso, if you look at it, Nespresso has a very distinct business model in that sense. So Nespresso is a direct-to-consumer business. Since the very beginning, it's 40 years now, this year, Nespresso, and since the very beginning, it's a direct-to-consumer business. It is a business that is based on a system and so there is many reasons to keep this business as a globally managed business. Also, if you look at it, how it is set up from the very beginning, all of the production is here in Switzerland, and then we drive a successful global, true global brand that looks the same in each and every market from Switzerland. So for the time being, we don't see any reason to integrate that. And then there is, anyway, very good collaboration with coffee already. If you look at it, what we have launched, you know, in the Nespresso factories, we produce also the capsules that are branded under Starbucks and under Nescafé. And so there is obviously already an overlap that we collaborate from the Nespresso part with the broader coffee business to drive, again, a category growth, not only the brand Nespresso, but the category, which is portion coffee, which we are by far the number one company, and Nespresso is the number one brand in this space. So that's to Nespresso. And then the four pillars. Look, now the four pillars, they don't have a P&L responsibilities. The four pillars, you can look at them as strategic business units, as we have had up to now. So there will be a head of the coffee strategic business unit. There is one person in place. This is the position that I have had in the past. There is a head of the strategic business unit for pet food. There will be a head of the strategic business unit for the unified nutrition one, and then on food and snacks, and each one of those has a head of the strategic business units. And the head of all of that is David Rennie, who leads strategic business units and sales and marketing at Nestlé. So there's not a case to build a new structure around this. It's about driving clarity and focus for driving growth in the company. Thanks a lot. The next question is from Alexander Marrow, Reuters. Alex, please go ahead. Hi there. Thanks for taking my question. Just on the sale of the remaining ice cream businesses, can you give an idea of how much, how valuable these assets are that you're looking to sell? And any more clarity on the sort of timing of a deal. And does this mean that you're not planning to exit the JV with Froneri, or are you doubling down on that? Thank you. Yeah, I can give you, I can give you some of those, some of those numbers. Look, the ice cream business, we have said it's, it's in six markets. It's, this is shy of CHF 1 billion in terms of, in terms of sales, and, and we'll, we'll, we'll, get that. It's a staggered approach, so because it's six markets in different geographies, we will, we will get, those, integrated into, into Froneri during this year and the beginning of next year. This is, this is what, what the plan is. And, and there is, there is, there is no, there is no plans to exit the JV with Froneri. We're really happy with the performance, that, Froneri is driving. Selling the remaining ice cream business of Nestlé into Froneri is our strong belief that Froneri is the right owner for those businesses and we own half of Froneri, and we're happy with the job they're doing so far. Very good. The next question is from Ivo Ruch, Finanz und Wirtschaft. Ivo, please go ahead. Ivo. Good morning, everyone. Thank you. So my question is also regarding the new strategic pillars. Can we assume now that your assessment of the portfolio is now kind of finished, or do you have further adjustments in mind, given there are some still some weak businesses in your portfolio? Or should we assume that, I mean, looking forward, you're constantly reviewing all of the businesses as you did in the past couple of weeks? Yeah, look, it's a good question. Look, it's never finished, is it? And what we are doing, I mean, we're not constantly looking at it, but periodically, with Anna and the team and the board, we're looking obviously at the whole portfolio and look if we need to take action. What we are doing is quite substantial if you look at it. You know, ice cream, we have mainstream VMS that will move forward soon. Waters, we have announced that that is now has now been launched. And all of these processes, obviously, it's quite a distraction for the company. So for time being, there's nothing new to announce. We will periodically review our portfolio, and we will shape it to make sure we have the right profile to deliver the growth. But the company is really what we're focusing on at the moment is truly on growth, which we believe is the largest opportunity we have to drive shareholder value going forward. And, you know, each of those processes is a distraction, so we take them step by step. But for time being, there's nothing new to announce, and we're periodically reviewing where we need to review, and we'll take the decisions quickly, without, you know, without a lot of, you know, with a data-based approach if we need to action something. Perfect. We'll be moving to CNN. Hanna Ziady from CNN. Please, Hanna, go ahead. Hi there. Thanks. Can you hear me? Yes, we c an hear you. Great. Thank you. I'm afraid I wasn't able to join the investor call this morning, so apologies if this will be a repetition for you. But two questions, if I may. One is on ice cream, just whether the sort of push by consumers towards, you know, healthier lifestyles and the rise of these GLP-1 drugs, does that have anything to do with the sale of this, or does the sort of sale process long predate that? Can you just comment on, you know, whether that's played any role in your thinking? And then just one question, if I may, on the infant formula recalls. I realize that, you know, there's an ongoing process there, at least in France, which, with French health authorities investigating the deaths of three infants who were believed to have consumed the recalled products. Can you just speak to, you know, is Nestlé in contact with French health authorities? Is the company implicated potentially? I realize there's no link yet been made, but, is it Nestlé's products that are implicated or another company's products? And then just any, you know, any new developments with regard to the formula recall, and any ongoing investigations would be great. Thank you. Yeah, good. Thanks, thanks for the question, Hanna. Look, on ice cream, no, it has nothing to do with GLP-1. You know, interestingly enough, the ice cream category shows still, you know, mid-single-digit growth consistently. So that category has not yet been affected. And I believe, while GLP-1 patients, they might, you know, eat less ice cream, they will change how they will eat it and how often. And Froneri is focused on that category and will be the best owner. But GLP has not been a thought for us. It's really, we have six remaining businesses. We have sold all the rest to Froneri, and those six have been or are a distraction for us, if you look at the rest of our portfolio, and that was behind it. And we believe Froneri will be the right company to drive the right focus and the drive, the right marketing to drive this to growth. So not GLP-1 connected. Look, on your question on infant formula. Look, first of all, we obviously we're saddened by the news that you know, three babies have died. There is no link today to any infant formula product, nor to Nestlé nor to anyone else's. There is an investigation ongoing, and as far as we know, we have not been contacted by the authorities, and inform as we go. But to date, there is no clear link, and Nestlé has not been implicated. As I have said before, our main focus is quality, safety, and the quality of our products and the health and safety of our consumers, and that has always been at the center of what we do. Also, during this recall, as we were the first in the industry to recall our products, and the industry followed suit, almost a month later. So we were always guided by the principle of consumer safety at the center of everything we do. The next question is from Thomas Oswald, AWP. Good morning, Thomas. Thomas, you can unmute yourself. Yes, good morning. Yeah, good morning. Can you hear me? Hello again. Thanks for taking the question. I have a follow-up to the infant formula recall. Are you taking any legal action against your supplier in China? And maybe have you made any provisions for potential legal cases, which you're maybe facing? Yeah. Thank you, Thomas. Look, we will obviously reserve the right to take legal actions. We have not done that so far. Focus of the company has been on the recall and is now on replenishing the stocks. That is where we're focused on, and then we will see what needs to be done on the legal side. And we have not done any provision so far. So we'll work that through as we need, but focus is really on getting the market restocked. That is where we're focused on at the moment. An additional question from Madeleine Speed, Financial Times. Good morning, Madeleine. Hi, morning. I wanted to ask what the focusing on four businesses means in practice? What in concrete terms will that change? And then the second question is on the L'Oréal stake. There's obviously a lot of questions from impatient investors about that. What's the rationale for staying in there? Thanks so much. Good. Thanks, Madeleine. I'll talk to four business, and I'll have Anna talk to L'Oréal quickly. Look, the focus on four businesses is truly that. So it's focus for the company. It's focusing on coffee, pet care, nutrition, and food and snacks. This is where we play. And also what it drives is clarity of how we play then in the market. And how we play, and I don't know if you had the chance to listen to our investors' presentation, there was one photograph in there where we showed a store in the Philippines, where all of those four categories or four businesses come together as one in one store, executed in one store. What's very clear is that, you know, when you look at how we execute at Nestlé, the execution, the P&L ownership, the connection to consumers, customers is intrinsically located in the market, so it's owned by the market, close to the consumer. Anything that has to be global needs to be centrally driven from here. Look at brand stewardship, look at long-term brand strategy, ways of working, end-to-end workflows, science-based and technology-based innovation pipelines, et cetera, are globally driven through our strategic business units that are now managed under those four pillars. That gives clarity and focus to the company as a whole, and it's obviously in service to drive our ambition to get the company back to 4%+ organic growth, which should be real internal growth driven. On L'Oréal, Anna, if you can give a bit of color to that one. Yeah, just quickly on that one. Our L'Oréal stake is a financial stake, and, and we are very dispassionate about it. That said, it's performed very well for us, over the years, and for our shareholders. From our perspective, it's not the biggest route to driving shareholder value right now, nor do we need to dispose of it to deleverage, as we're deleveraging irrespective. So our big focus right now is on the biggest driver of shareholder value, which is growth, and everything we're doing is around accelerating growth. Thank you for this. Thanks. Yep. Madeleine, yes? I think we continue with Benjamin Weinmann, CH Media. Yes, good morning, everyone. I also have a question regarding the infant nutrition recall. During your presentation, you mentioned that obviously there's also learnings despite the standards of quality and safety. Can you, in simple terms, explain what are these learnings? What concrete measures are you taking to make sure this won't happen again? And how also would you explain to nervous parents, how could this happen in the first place? And second question regarding the brand stewardship with the new four pillars that you mentioned. You gave the example of Nescafé, that it should look the same way, whether it's in Mexico or Switzerland. So would you say until today, there were too many liberties in the local markets being taken? Yeah, two good questions. So look, I'll start with the infant formula recall. Look, the learnings I think are twofold, and it's very clear, and it's something we have consistently done in the past. But clearly, you know, when we look at our own facilities and everything that we do internally, we have very high-quality standards everywhere, in every factory, each and every factory you go. Many times, and in many places, those standards are higher than would be required by the law or by any local regulation. And obviously, our clear actions is that those same quality standards apply everywhere, that where we have suppliers or people producing for us, and that is true. In this particular instance, obviously, this supplier that supplied this ingredient to us, this was not the case. And it was also not the case because you know, having cereulide in oil is a very rare occurrence, and that it was, that's why it was not on our radar and not on the industry's radar. We found this issue because of our Good Manufacturing Practices and quality standards that go beyond Good Manufacturing Practices, and we're the first in the industry to find the issue. And it was also, as you have seen, it was not something that was regulated by anyone. Has then been regulated by the European Union, and there is now a level that has been put in place from a regulatory point of view. So it's something the learning there is, you know, these risks move, and we have to be one step ahead of identifying these risks. But obviously, I'm very clear, you know, cereulide has nothing to do with infant formula and this is not something that should happen. What I can assure you that Nestlé has always been and is laser focused on the quality of its product and the safety and health of consumers, especially when it comes to infant formula. And, you know, to parents out there, I apologize for the inconvenience that this recall has caused, and we are shipping a safe and utterly controlled product since the recall is done. And, as I said, we have recalled one month earlier than any other company out there, and our product that is out there is safe to consume, and we will keep it that way. The Nescafé example. Then on Nescafé, you look, was there too much liberty out there? Yes, look, there was. And I can talk to this quite, quite well. When I took over the Nescafé strategic business unit, you know, you would look at Nescafé across the world, and it was Nescafé written, but it was not looking the same, it didn't have the same look and feel. And what then a centrally driven unit can do is to have one design that has now been rolled out across the world, and the Nescafé logo and the Nescafé design looks more or less the same everywhere, without obviously losing the local specificities. So might have, you know, freedom in the framework that local markets can still apply. But a global brand, in my view, has to show up as a global brand. The best expression is Nespresso, that it looks the same across the world without any freedom in any framework, but then all other brands have some freedom in the framework to make it look local, but it should be recognizable as a Nescafé. And these are the things that make a lot of sense to have at the global level, while local markets have the freedom to execute the brand as they wish. The next question goes to Daniel Hügli, cash. Daniel, can you hear us? Doesn't seem to work. We will come back to you afterwards, and, we move to. Can you hear me? Ah, yes, we can hear you now. Sorry. I have some technical problems here. Good morning. I have a follow-up question on the L'Oréal stake. I was not able to follow the investor presentation either. I just saw some headlines saying that the sale of L'Oréal stake doesn't have any priority. Can you give us a scenario where this sale of that stake has a priority? We are very focused on delivering shareholder returns, and we start from a perspective of: What is the fastest way that we improve returns for our shareholders? And so our number one priority is doing exactly that, and therefore, our focus, absolutely uniformly across the group, is around accelerating RIG. Because that is what gets our products being eaten and drunk more globally, and accelerating RIG is what also drives margin, it drives cash flow, and it drives returns. So what we said on the call was that was our number one focus. Very good. Next question is from Alain Détraz, 24 Heures. Alain, can you unmute yourself? Otherwise, we will come back and go first with Fabienne Kinzelmann, Bloomberg. Fabienne? Seems to be a technical issue. Fabienne, can you hear us? Yeah, do you hear me now? Yes. Yes. Okay. Good morning again. So, regarding the ice cream business sale, and thanks for confirming the Bloomberg scoop. So, did I get it right that, the ownership structure of Froneri will not change, and that you will keep it like it is today, or is like, w ill the ownership structure change? And then the other question I have, I looked at a corporate governance report and saw, Philipp, that your predecessor received no compensation upon termination, other than his pro-rata base salary, until September 1st. So what I would like to know, i s there still any legal issue to solve with him? Is there anything still w hich has to be settled? Yeah, thanks, Fabienne. Look, on ice cream, so there is no, there's no change to ownership structure at the moment, nothing at all. So, Froneri will be a JV as it is today, and we just transferred those six ice cream businesses. We sell that to Froneri, so nothing will change. On corporate governance question, look, I don't know about any legal action. It's not honestly something I spend my time on. Next question is from Nathalie Olof-Ors, AFP. Natalie, good morning. Natalie, can you hear us and unmute yourself? If not, we will come back and go to Erich Bürgler, BILANZ. Erich, please go ahead. Good morning. Good morning. Good morning. To the Nestlé water business, you're looking for a partnership. What kind of partnership exactly? Is that also gonna be a joint venture? Is it also an option to sell the whole business? And regarding the water brands, I think you still have around 30 water brands, all over the world. Will you drop some of them, some of the local brands? Which one will you keep and bring into this partnership you are working on to establish? Yeah, look, in terms of the partners, we said we initiated a process of a partnership. The partnership can take many forms, so it's not defined yet, but we're looking for a partnership in some way. In terms of brands, it comprises all of the brands, and it's then to the new partner or owner to determine the future of any brands. But it's the perimeter is all of the water brands, global and local. Next question is from Claudia Gnehm, Tages-Anzeiger. Hello, I hope you can hear me? Yes. That Nestlé has Good Manufacturing Practices, and above standard, I mean, this has been written, and it's all over the place, right? Even higher safety standards. So I still wonder, how come that a supplier did not have the same high standards as your own factories? And how can consumers trust that, I mean, this is not happening elsewhere in another factory where you also have another standard. I mean, how can you assure consumers, and how do you explain that they didn't have the same standard? Yeah, look, it's a good question. I understand the anxiety around it. Look, obviously, all of our suppliers have to have the same standards as we have. In this particular case, as I have explained before, it was a not known risk that you know this particular toxin could be found in oil. It was new to us, and it was new to the industry. And hence, you know, when we found out, due to our superior quality and safety practices in our factories, we immediately then went to recall the product, and we acted swiftly and were first to find out and worked closely with authorities, healthcare professionals, and also industry associations to make sure, you know, this is known by the industry. And still then, you know, it took the rest of the industry to recall almost a month after we did. And that is not an excuse, and obviously, we will take these learnings and make sure this doesn't happen again. But it's important to understand that also testing methods and these risks evolve, and we will be one step ahead to make sure we identify these risks everywhere and apply those learnings everywhere. But you can be assured that our quality and safety practices are intact within our factories and within all of our suppliers we're sourcing products at the moment. Thank you. The next question is from Christian Kolbe, Blick. Good morning, Christian. Good morning. Sorry, I've got some technical issues to get into the call, but maybe I ask a question for the second time. The first question is, Nestlé says you are estimating about CHF 200 million impact of the baby formula issue. Other estimates say about CHF 500 million. Why are you sure that the costs won't go up for Nestlé more than the CHF 200 million? And the second one, Michael Beer, the Director of Bundesamt für Lebensmittelsicherheit, says that he's not happy how the companies, not only Nestlé, but all companies, reacted on the issue. And my question is, why it took so long till it was clear that Switzerland was affected or not? I'll leave the first part to Anna on the size of the recall, and I'll take the other one on the speed of the recall. So on the first part, what we said on the call this morning was there is a direct impact of the recall, so that is the cost of the recall or the sales impacted by the recall itself, and the sales or the lost sales due to out of stocks of 20 basis points for the year. So that was a very specific statement. We also said that the broader consumer impact was uncertain. We'll, you know, learn more as we go. That said, it's a sector that we know a lot about. We work very closely with doctors and also regulators. That's what has given us confidence to wrap all of that potential impact together in a guidance that we're giving today of around 3% to up to 4%, organic growth. Good. And then, when it comes to the speed of the recall, look, I want to be very clear, we were very fast in recalling when we found out about the issue. And we not only found out about the issue, we also informed authorities, and we informed healthcare professionals and industry associations to make sure, you know, this knowledge gets beyond Nestlé, because we knew that the supplier that we sourced this ingredient from was a supplier that would also source to other companies. But that's another story. What we have done over the holidays, when we found out about the issue, we immediately worked together with authorities and recalled as fast as we could. So, and that includes Switzerland. So there was no delay that I'm aware of that, you know, we have waited and seen. When the issue was detected, we immediately recalled, and we informed authorities to make sure these products are off shelf and consumers are informed and are kept safe. So we moved fast. Others didn't. And maybe the critique is in on that side. But Nestlé was really fast, and I'm proud of this, and I'm proud of how our team reacted to recall swiftly and, you know, always with the consumer's health at the center of everything we do. We can take three short questions. First, Klaus Bonanomi, SRF. Klaus, please go ahead. Klaus, we will get back to you. Looks like we have a technical issue. We are back to Matthias Benz, and then Hanna Ziady, and then go back to Klaus if he's around, and then we need to close. Matthias, please go ahead. I have a question on the German supplier of this ARA oil. Why did you choose him in the first place? Was that for cost reasons? The second question would be, was it the only supplier you had, or were there different suppliers for that product? Thanks. Yeah, thanks for the question. Look, and they're linked, because there was, in the past, only one supplier, and, which is a risk, obviously, in such an ingredient. And we chose the supplier that then generated the issue to have a second supplier in place. The supplier was checked and audited and was vetted and was cleared by our quality assurance. And obviously, what happened then, that they somehow in the process didn't have the process in control. But it was not about the cost reason at all. It was about making sure that we have, you know, that we can ensure supply of this important ingredient to produce infant formula. There are several suppliers, so now we have stopped sourcing from that concerned supplier, and we source from other suppliers. All of the ARA oil that comes into our factory is now tested. So we test the oil before it goes into production, and we test during production, and we test when the product comes out of production. So we are 100% sure that all of our products are 100% safe to be consumed by babies out there. We're gonna take a question from Hanna Ziady, CNN. Hi, thank you so much for coming back to me. Just to go back to ice cream, you mentioned that it was a distraction. Can you say just a little bit more on, on why it is that you're actually selling this business? Because, sort of echoes a little bit maybe the reasons that Unilever gave, you know, several years ago, which kind of came down to, I think, ice cream, as they called it, distinct characteristics. So, you know, it's season-dependent. The supply chain can be more complex 'cause it needs to be able to support frozen goods. Is that, you know, or your, or your reasons some of the same as that? Or can you just sort of spell out a little bit more why sell ice cream? Yeah, sure. Look, it is a distraction. When I say it's a distraction, it's something that we're not focused on because we only have six scattered businesses across the world, and this is an ice cream business. As you said yourself, you know, it's seasonal, it's frozen supply chain, it is highly brand driven, and you need some scale to drive this. And Froneri has exactly that. And that was when, in the first time when we set up the Froneri business, that was the idea. And we held on to those six businesses because we thought we could drive, you know, growth. And looking at it now, we have these six businesses which, you know, they don't have any global scale. We cannot, we cannot drive this, the same way that Froneri can. And that's why we think because all of that, Froneri has all of those capabilities. They know exactly how to drive a seasonal business. They have, scale, they have the knowledge, and, and they have the brands, and they have shown this in all other markets where, we have sold them our business, that they can drive, great growth, and success. And so the same should happen with those, six businesses. So that, that's what I mean with, with the distraction. So we will not, you know, invest more in those businesses where we don't have the capabilities and the scale that we need to be successful, and Froneri has. And so they are the right owner for those great six businesses, because they're great six businesses, and they have a lot of potential. Thank you. Before we conclude, let's try Klaus Bonanomi again, whether we can connect. Klaus? Doesn't seem to be the case. There seems to be a technical problem. Sorry for that. Thank you so much for your participation this morning. Our lines are open. If you have any further questions, call our media relations number. We're happy to assist, and we wish you a great day. Thank you so much.