Hello and welcome to the Rémy Cointreau full year sales publication. My name is Jess, and I'll be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, there will be the opportunity to ask questions. This can be done by pressing star one on your telephone keypad to register your question at any time. If at any point you require assistance, please press star zero and you will be connected to an operator. I will now hand over to your host, Luca Marotta, CFO, to begin today's call. Thank you. Good morning, everyone. Thank you for being here with us this morning. I think that as you have seen in the press release, we generated an outstanding growth of 27.3% in organic terms this year, representing an increase of +29.4% versus two years ago, 2019-2020. This performance reflects a significant mix price improvement, +9.2%, as well as an exceptional volume growth of 18.2%. As expected and mentioned several times, sales were down 9.4% in the Q4, which represents a growth of +4.2% if you compare the Q4 to the 2019-2020 period. In fact, the quarter has been impacted by the strategic inventory management on Cognac, our decision, and on the Whiskey portfolio as well. The negative calendar effect guidance expected of EUR 6 million represented an impact of three points of growth at group level in Q4. Apart from these specific peculiar effects, the underlying consumption trends remained very robust, both in Americas and in EMEA. When it comes to APAC, Asia Pacific zone, and more particularly to China, the country was affected by some drastic lockdowns in March, but fortunately, this is temporary and is occurring during the low season. The impact of that on the activity is limited. Now looking at overall sales performance by region, starting with Americas. Americas were up +30% this year, boosted by the new consumption paradigm in the US, which translates into a buoyant consumption level as demonstrated by the two-year performance, which stood at sell-in and ship-in basis at +54.2%. 54% higher than two years ago. APAC sales posted a 25.8% sales growth, i.e., +19.8% growth on a two-year basis. This has been driven by the outstanding performance of CLUB, XO, and LOUIS XIII, while the Whiskeys portfolio at the same time continued their strong expansion. Finally, last but not least, EMEA, Europe, Middle East zone, grew on the year at +22.4%, led by the remarkable growth of Cointreau and the Whiskey portfolio, again. We are now almost back to pre-COVID level for the zone, specifically -3.5% if you compare EMEA to two years ago. This was shipment sell-in. In terms of value depletions at group levels, the best approximation of the final consumption result and performance, we recorded a very strong double-digit growth in China and in this EMEA zone over the last twelve months. Talking about the US, depletions were up mid-single digits over the last twelve months, but if we strip out the SOP, which is not our priority in terms of volume growth, depletions were up value depletions at strong double digits. Moreover, to better appreciate this performance, it is key to consider the meaningful base of comparison. What I mean, it means that more than +50% of value growth last year, which clearly shows that and what we call being the new paradigm in the US. In a word, on a two-year basis, in terms of value depletions in the US, we are up +60%, which demonstrates that on top of the huge rise linked to the new paradigm in 2021, the strong dynamics are there, lasting and continued in 2021, 2022, both in terms of volume and value. What I mean is that +60% can be divided in +45% more or less in terms of, over two years in terms of volume depletion and 15 points, 1.5 points of mix price effect, which demonstrates on a mathematical basis how huge our pricing power and valorization power is in the US. To conclude a word on the slide, I'm sure you want to know something about that. I would like to reconfirm our full year guidance, both for our current operating profit in absolute value and our expectations in terms of current operating margin. After this introduction on pages 3 to 7, let's talk a bit about some initiatives that have been undertaken over the last quarter and illustrate our ambition to reinforce our advertising & promotion investment in the second part of the year, particularly on our global priority brands. Let's start with page number 3 and the first result of the new Rémy Martin XO campaign in China. As shared in the previous session, we have launched an important new campaign for XO China beginning of January, embodied by the actor-singer Jay Chou. The objective is to connect with the new generations. So far, the results are very promising through this 360-degree campaign, which generates a lot of buzz and visibility, as you can see in the slide. Some figures, more than 1.3 million of outdoor media in 19 cities, around 440 million impressions on social media, leveraging more than 100 influencers, around 225 million on coverage in terms of press release, and more concretely on a store basis, around 400 stores in 58 tier one and tier two cities equipped with trade visibility. More important, we continue to recruit for our CRM program with that, with more than 10,000 new members. Pandemic forced us to postpone our communication plan, especially some activation in the on trade and some private dinners. As we said for the results in terms of invoicing execution, this is absolutely temporary and will be done in the coming months. Nothing is changing in terms of expectation and execution in China. Page four, a couple of words on LOUIS XIII and the launch of this new campaign mid-March. Following on from its two-part wonders campaign involving various high-profile international artists, LOUIS XIII has made a new film entitled Believe in Time, with the objective to generate a simultaneous buzz around the world. This third opus on the theme of time brings together US performance artist Solange Knowles, Chinese haute couture designer Guo Pei, and Franco singer and director Mati Diop. The result is a powerful film that has been cited in around 1,000 articles worldwide and viewed over 20 million times. Page five, Cointreau. Cointreau in the US. Noting and knowing, more than noting that margarita drinkers love sports and watch sports, we have decided to leverage game day occasion in Q4 to recruit margarita drinkers. Q4, as you know, is full of exciting sporting events in the U.S. from January with the NFL playoffs to March with basketball March Madness. During this activation, Cointreau has reaffirmed its positioning as the essential and unique original ingredient for margarita in both retail and media. Alongside activation in 14 major chains, Total Wine, BevMo!, Spec's, for instance, one of these initiatives was our partnership with one of the most, if not the most, highly engaged sports property, the Bleacher Report, and leveraging our new collaboration with Drew Brees, the former New Orleans Saints quarterback. It is a bit early to have a good vision of results, but so far, sales have been strongly accelerating during this period and were up +90%, compared to two years ago, the week leading up to the Super Bowl. Page 6. Page 6 illustrates how we continue to animate our single malt whiskies in China with nice performance and increasing success. As you know, Bruichladdich is enjoying fantastic success in China within the new generation. It was one of our best performances during the Chinese New Year. In order to enhance brand education, increase its awareness, we've opened our first Bruichladdich stores in a shopping mall in Beijing that will travel around the country. These new concepts that we call Know What is in Your Whiskey is capitalizing on the current strong fashion that we see with consumer to discover the uniqueness of our whiskeys, their histories, their values, and their terroir. In parallel, we have launched just before the Chinese New Year a limited edition called Black Art 9.1 as private dinners in six specific targeted cities. There are not many of those old casks left in the warehouse of Bruichladdich, the distillery on Islay, of this type. This is a 29-year-old Bruichladdich Black Art version 9.1, and the oldest Black Art ever bought. Particularly, at 12,000 bottles available, sold worldwide, that more than 75% were dedicated to China and were sold very quickly. It is a precious item, $600-$700 per bottle. This is volume issue as well. Finally, page number seven is coming back on the launch of The Botanist, first big campaign during the Super Bowl, as already mentioned. Rémy Cointreau has decided to strengthen its presence, investment on The Botanist to boost brand visibility, and this is the delivery. The Botanist is perfectly positioned today to take advantage of the rapid growth in the US gin category and new consumption trends like mixology and premiumization. Its goal to become an undisputed leader in the high-end gin. We will mobilize all necessary resources to achieve that goal. The result of the campaign were really positive. Over 13 million campaign views on YouTube. It was the number two ranked Super Bowl ad for social impact. Outranked big household names such as Google Pixel and also General Motors. It was also the number one most inspirational Super Bowl ad. Now, let's move to slide number 6 and back to figures. Let's start with the 12-month sales analysis. Sales amounted to EUR 1,312.9 million, up EUR 302.6 million year-on-year or +30% on a reported basis. This reflects a very strong organic gain of EUR 276.1 million, i.e., 27.3% organic sales growth, which includes split +18.2 volume effects at group level and 9.2 at price mix. A small scope benefit of EUR 2 million, i.e., a gain of 0.2% linked to the acquisition integration of Lillet and Telmont, and a very positive currency translation impact of EUR 24.5 million on the top line, which means +2.4% gain over full year, including EUR 19.2 million gains in Q4. This gain was largely driven by the Chinese Yuan, which contributed by EUR 17.5 million to the total gain, and to a lesser extent, by the US dollar, which contributed by 2.6 million euro, or the British Pound, EUR 2.3 million. At the same time, some currencies were negative. Japanese yen and Polish zloty posted a slight deterioration of EUR 0.7 million in conversion term. Now, let's go to slide number nine, which shows, as usual, on the left, our organic performance over the past 12 quarters. In red, the 12 months rolling organic performance of our group brands, which stands at 27.7% at the end of the year. Trends have gradually normalized throughout the year. On top of that, our group sales were well above pre-COVID levels, showing a very strong increase, as you can see, of 29.4% compared to 2019/2020. Even Q4, which was impacted by strategic inventory management, our decision and, furthermore, Chinese New Year calendar, stood above Q4 2019/2020 for +4.2%. Now, let's move to our full-year sales growth by region, slide number ten. Our 27.3% organic sales growth at group level was driven by an outstanding performance in Americas, up 30% and 54.2% versus two-year, confirming, I repeat, it's very important, the new US paradigm. A very strong growth in Asia Pacific zone at +25.8% versus last year, i.e., +19.8 compared to two years ago. Despite, and remember that, a collapse compared to two years ago in the travel retail activity, which was important in the impact. EMEA was also strongly up, +22.4% versus last year, benefiting from the rebound of European consumption on the back of the on-trade gradual reopening. On a three-year basis, the performance is now close to pre-COVID level, -3.5, and should be exceeded very shortly. Let's dig in this organic trend by region on slide number 11. Starting with the Americas, whose organic sales were up +30% in 2021/2022. In the US, sales were down low single digits in Q4, strongly impacted by strategic inventory management decision on core metrics, mostly on the SOT, to fully leverage as well the price increases in April and manage the supply sustainability. Apart from this specific effect, consumption remained very robust in both on and off-trade. Throughout the year, it has benefited from the new consumer trends. Notably the upmarket move and the mixology. In light of these excellent results, we end the year with a low level of inventory, especially in VSOP. In parallel, full year value depletions are positive, being up mid-single digits overall or strong double digits if we exclude VSOP, which has been clearly tempered by our decision to foster the high-end segments and 1738 as well. In Canada, sales were up very strong double-digit following a weak Q3. Conversely, Latin America enjoyed a strong double-digit growth in Q4 on the back of the continued recovery of tourism and led by liquors, wine, and spirits. End of March 2022, the Americas accounted for 52% of group sales stable year-on-year. APAC organic sales growth was excellent in 2021-2022 at +25.8% in line with value depletions. China sales were down double digits in Q4, impacted by three factors. First of all, a very high base of comparison. Remember that we are up triple-digit last year, so the base account is meaningful. Second, the Chinese New Year calendar effect, as said, EUR 6 million, which is at APAC regional level, represents around 9 points of growth. Third, strategic inventory management as well on China. Apart from some restriction at the beginning of the quarter and the lockdown in March, consumption remained strong, including the Chinese New Year, which was in line with our expectation and as a result, successful. CLUB, XO and other whiskey portfolio have been the best weapons in China to continue and realize gain in the value market share during this critical period. All in all, very important, we end the year with an extremely low level of inventories. Extremely low, which will give us a lot of agility and responsiveness as the country dynamics restarts. Looking into value depletions, they were up a very strong double digits across the portfolio. The main part of Asia reported a strong double-digit growth in Q4, driven by the gradual lifting of health restriction and the strong performance with LOUIS XIII and Cointreau in Southeast Asia. Conversely, South Korea and Japan were affected by the return of sanitary measures. At the end of March 2022, APAC accounted for 30% group sales stable versus last year. Third region, EMEA organic sales were up +22.4% in 2021-22 in line with value depletions. The overall performance of the quarter was led by Western Europe and Benelux. Western Europe was up double digits in Q4, led by France, Greece and Italy, particularly Cointreau with LOUIS XIII and METAXA. UK was down low single digits in Q4, impacted by once again our strategic inventory management decision on cognac, while Cointreau and LOUIS XIII, so the high end, posted a very strong performance. The rest of the EMEA region, very good dynamics led by LOUIS XIII, Classic Laddie and VSOP. Conversely, Eastern Europe, in particular Russia, was impacted by geopolitical context. At the end of March, EMEA region accounted for 18% of our group overall sales, stable versus last year. Now, let's move to the 12-month sales growth by division, slide 12. Our 37.3% organic sales growth in group level show the broad-based growth with the cognac division up +26.3, i.e., +30.7 over two years. Liquors and spirits being up +31.7 in the year, i.e., 27.5 compared to two years ago. Near one, at the same time, partner brands, which now represent around 3% of our total sales, the rate is stable versus last year, were up at +15.2, i.e., +13.5 compared to two years ago, supported by stronger dynamics in EMEA region. Now, let's begin using the slide number 15 in the analysis by division, starting with cognac. Cognac sales posted an organic growth very strong of 26.3% in 2021-2022, including an exceptional volume increase of +12.5 and outstanding terrific price mix gain of 13.8%. End of March, the cognac division accounted for 72% of our sales, down 1 point year-on-year. Cognac in the Americas. In all North America, cognac sales were up a very strong double digits in 2021-2022. Q4, however, sales were down low single digits impacted by strategic inventory management, mainly focus on VSOP, as you know, and repeat, it is very important. Looking at the rest of portfolio in the US, i.e., 1738, LOUIS XIII, XO, it continued to perform very well in the Q4, enjoying buoyant demand and despite the fact that we tempered our selling clearly before the average price increase that were very important certainly. In terms of sell-outs, the evolution remains very dynamic in on-trade, while off-trade generated a stellar growth in Q4 compared to three years ago. Finally, all in all, value addition were up low single digit over the twelve months and up mid-teens excluding VSOP. More important, I repeat, it was on top of a very high base of comparison. Now look at the same numbers of the last three months. Depletions were up mid-single-digit and increased a very strong double-digit growth excluding the VSOP. The last three months is even accelerating the 12 months, 12 growing months trends. Price mix effects on cognac in North America were strongly positive, as you can see in the spreadsheet, by 10 points in the 12-month period ending March 2022, led by price increase, but as well by positive mix effects. Latin America was also impacted for cognac by strategic inventory management decision via VSOP, 1738 and XO, while Tercet generated very strong performance. Cognac in APAC. In APAC, China recorded a very strong double-digit growth in the year 2021-2022, led in terms of ranges by CLUB, Tercet, and XO. In mainland China, sales were down double-digits as said in Q4, impacted by meaningful high base of comparison. Sales were up triple digits last year and unfavorable calendar for the Chinese New Year, EUR 96 million, and a strategic inventory management decision. While Chinese New Year depletion were in line with expectation led by the off-trade, particularly Club and XO, March, I said, was affected by the implementation of strict lockdowns. However, the impact on the activity has been limited considering that it was and still is low season and, I repeat, we end the year in China with an extremely low level of investments. Looking at other areas, Hong Kong showed positive strength until January, but it was impacted by COVID restrictions since then. Macau generated a very good performance led by 1738 and Club, and Taiwan also recorded strong growth led by 1738 and XO. The main part of Asia, we recorded a very strong double-digit sales growth in 2021-2022, with contrasted trends in the Q4. While the north of Asia was impacted by health restriction, the south part of Asia showed excellent performance led by Three Thirteen. Finally, EMEA is a mature region had cognac sales that generated a double-digit sales growth across the region, particularly Benelux, Germany, France, and UK. In Q4, the overall performance was impacted by, as you know, as I understood, our strategic inventory management decision, notably in Africa and the UK. In parallel, Western Europe and Benelux continued to perform well led by Three Thirteen. Now, let me talk to the largest the spirit division slide number 14. The largest spirit division posted an incredible 31.7% organic sales growth in 2021-22, reflecting an increase of 24.6% in volume and a price mix gain of 7.1%. End of March, largest spirits accounted for 25% of our sales, up 1% compared to previous year. Now let's review the performance of the division by region. In Americas, North America recorded a very strong double-digit sales growth in 2021-22, including growth of a high single digit in Q4, led by whiskey's portfolio, Cointreau and The Botanist, global priority brands. This performance reflects good dynamics in the on-trade channel, while off-trade continued to perform strongly at double digits compared to two years ago. Specifically, Cointreau's value addition were up strong double digits over the last 3 and 12 months compared to last year, representing a terrific stellar growth compared to 2 years ago. Besides that, price mix for Cointreau was flat compared to last year in the last 12 months period ending March, on top of a high single-digit increase of price mix last year. This evolution also reflected some adverse mix format effect linked to the outperformance of the Cointreau 1-liter, which is a off-trade SKU, versus the 75, 750 SKUs, which is more on-trade. In parallel, Latin America recorded a strong performance in Q4, driven by Mount Gay and the whiskey portfolio, on the heels of the gradual recovery of tourism. In EMEA, important region for largest spirit, sales grew a very strong double-digit sales growth in 2021 and 2022, led by all regions and brands. In Q4, sales were up high single digit led by Western Europe and the UK. As said, while on-trade continued to benefit from its recovery, off-trade remained resilient and performed well. Cointreau outperformed in the last quarter, supported by some market share gains in the UK and Western Europe. Whiskey portfolio was partially affected by strategic management decision in the mixed portion lots, where The Botanist showed good dynamics led by travel retail in Europe. APAC. In APAC, which is still has more regional lagers and spirits now, but with the growing whiskey will change. China posted very strong double-digit growth in 2021, 2022, with contrasted trends in Q4 in line with the cognac's performance. Northern Asia was impacted by health restrictions, and the South showed a good performance led by Korea. Last slide of the presentation before Q&A, slide number 15. As usual, we talk about guidance, and we confirm our full-year guidance. As already mentioned, we expect to generate a very strong organic operating profit growth that will be only delivered by H1 outstanding growth as the H2 diminished profitability will be impacted by three elements. Let me just repeat that. First, a meaningful and important increase of our marketing communication spend in second part of the year, in H2. Second, before the price increase that we applied at the beginning of April, the new fiscal year, we strictly manage our strategic inventories allocations of eaux-de-vie and aged spirits, i.e., we manage the inventory of our most accretive brands. Third, the very high base of comparison of H2 last year. All in all, we confirm, reassure on organic improvement for our operating margin, operating cost margin for the full year. A word on scope and FX in terms of impact on the bottom line. For the full year, we expect a negative scope effect on operating profit of EUR 2.4 million, which is a loss, while we now anticipate around EUR 5 million of positive currency impact on operating profit. One last word regarding the start of the year. We feel confident, absolutely confident, very confident in our 2022-2023 outlook, all things alike. The group anticipate a strong start to the year despite the high base of comparison and the context, which is still characterized by the pandemic in China. Thank you for your attention. Now let's go interact with the Q&A. If you would like to ask a question, please press star one on your telephone keypad. Please ensure the line is unmuted locally as you will be advised when to ask your question. Once again, that's star one if you would like to ask a question. The first question comes from the line of Laurence Whyatt from Barclays. Please go ahead. Good morning, Luca. Thank you very much for the questions. Three from me, if that's okay. Firstly, you flagged major price increases across your regions. I was just wondering if there are any specific regions where do you expect more price than others or any brands you'd expect more price than others? And if you could give any sort of quantification to major, does that mean double digits across the board? Secondly, your stock levels, you've given some good indications of the level of inventory, low in the U.S., very low in China. Do you have any indication of how much stock your wholesalers are obliged to hold and when you'd expect that to recover? Should we expect that to all come back in Q1? On VSOP, you've mentioned throughout the presentation that VSOP has been below the rest of cognac. Would you expect VSOP to be declining from here on as you focus your attention on the other higher-priced products? Thank you very much. Thank you for the question, Lau. Allow me to be a bit long on price increase. It's important. I'll be quite precise, magnitude, distinguishing the regions and the major countries. Overall, 2022-2023, start from April, is and will be a strong year of pricing power at group level. Combined price increase and sales mix improvement in terms of channels, in terms of format, in terms of destination, in terms of countries, states inside the US. This is an additional part, is always very accretive and is linked to the strategic inventory management decision we took in advance. Before jumping high, you have to hold your breath. We hold our breath and our performance was impacted in Q4, but gives more magnitude to jump higher. Figures. Inside North America, US, price increase will be for the cognac between high single and double digits, being more on the high single for the entry and the intermediate level and more double. Cointreau, liqueurs and spirits, mid-single. It's important. Whiskeys, a bit higher than low single. Inside China, cognac, the entry part of portfolio is high single, high end, more moderate, more mid-single. Still very, very important price increase. Cointreau in China, low single, and whiskey in China, mid to high single digits. Inside Europe, a little bit more complicated situation because of many, many different country dynamics. Overall, the inflation being inevitable and something which is also supporting our actions directly, will be above general inflation in key markets in cognac. Slightly below or generally matching general inflation in key markets in liqueurs and spirits. We are implementing price increases, we are implementing also in France, which is traditionally a complicated country in terms of price increases, and in line with the inflation in the key countries like U.K. In terms of core, clearly, cognac and global priority brands also in Europe, which we have decided in the past quarter to retain our brands. There will be more linked to the increase of price increases. Also on top of that, which is very important, I'd like to be clear on that, gives us to make a bolder decision to improve our mix in terms of format, in terms of choice of countries, arbitrage, and states also inside the U.S. A very strong pricing year combining strong price increases and important mix targeting goal to realize in 2022, 2023. All in all, without guiding the top line group level for the year, we are confident as you can see. Compared to this year, we expect to have more price mix effect in 2022-2023 compared to 2021-2022, and lower volume impact. Because the cognac growth for this year at very strong double digits can be something that we can target for the medium to long term. The better way to have that is to increase even more our pricing power and our mix position. Second question, stock. End of March by region. U.S., very low on VSOP, maximum two weeks, and quite low also on 1738, maximum one month. But not only for U.S., this is a global take. Something I would like to communicate to you, however, when you are changing gears, you are entering a new game with +60% for the US, +60% you will see that in China compared to 2 years ago in terms of competition. Talking about months in a changing gears mood, and when you have some volatility for different quarters, considering also our decision, not only the external events, does not make a lot of sense. Because what is one month today can be one week or two week in 3 or 6 months. What is important is to analyze the results and the stock position over a longer and more strategic point of view. One, 2 years, 3 years. Quarters are not meaningful, not in terms of performance and not only, but also in terms of finger-pointing, stock performance at a given moment in time. US, so I said, very low, particularly around VSOP and quite low on 1738. China, very, very low. So we think that we are very well positioned compared to our competition in China to profit when the dynamics will start. Also the fact that our wholesaler, also intermediate, export position is very, very low in terms of goods. The direct client market is there. We are there to perform right away, and we are very confident once the dynamics restart to profit from our competitive position and our portfolio in China, being better positioned in a, if I may, quite a better way compared to other competitors. Rest of the world, to close about Europe, performance are catching up with the average of the group. We are not stocking. We still remain very clean on our inventory, particularly in Europe. The levels are not so low like in China or VSOP, but they are very healthy. The correlation between sell-in and Europe and the selling starts to be witnessed month after month, even in this region. A very healthy and low situation in terms of stock. The third question, which is more than financial, more strategic. I think that Éric Vallat will be much better than me to answer to this question during our June results. VSOP is a key pillar of our portfolio. We are not giving up on the VSOP, not at all. It's a jewel, but we are valorizing it. Once again, if we think of that globally, we think much more than that. Our wish is the need of volume expansion because we have to valorize that. Think of VSOP that all along the year will have a volume growth expansion, which is not the core part of this and our strategy, and more the valorization of the products, not only in terms of price, but in terms of positioning on the shelves, in terms of format, going to avoid boxes and very packed SKUs more and more to increase the perceived and intrinsic value of the VSOP reference. It is not our core strategy in terms of volume growth, but still remain one key pillar with much more in terms of valorization at group level, playing as an additional element and a direct positive role, increasing the upper part of the portfolio starting in 1738, that in that case, we'll have also more fuel and more available space and room to be valorized and to be distinguished by the VSOP in terms of positioning, in terms of consumers. Sorry, I was a little bit long, but I answered in a wider way to your question to give some additional, very important, I think, flavor for what will happen in the next coming quarters in this. That's all very pretty clear, Luca. Thank you very much. The next question comes from the line of Olivier Nicolai from Goldman Sachs. Please go ahead. Hi, Olivier. Good morning, Luca, Célia. Just a few questions, please. Three, actually. First of all, could you comment on global duty-free trends, including and also excluding Hainan, and how does it compare to pre-COVID levels? Secondly, on China, you don't seem to be too worried, particularly since it's a low season at the moment for cognac consumption. Could you comment on the current depletion that you're seeing maybe in April in China? And how much of your business is coming from Shanghai or Beijing? And just lastly, a bit of a technical one, but just on FX, you flagged a EUR 5 million positive impact on your EBIT for this year. I assume it's just translational FX or is there a part of transactional FX here? If it's just translational, when can we expect a transactional part to kick in? Is it going to be for next year? If you could quantify, although I'm asking a bit too much now. Thank you. Yes. I will start with the more technical one, the last one. The five million was our best approximation of the impact of operating profits. So it is the combination of bottom line of transaction and conversion. So it is the hedge, including all costs and benefit and impact. For next year, 2022, 2023, it will be a very important element to follow. But it is early. I'll be more precise beginning of June, quite so, because already we covered all our needs. But spot rate of the dollar, for instance, also to Chinese yuan is changing, increasing at this moment. It's quite volatile. In good sense at this moment because we are very exposed to US dollar. All our currencies peg to that. We make some assumption. We don't have other choice but to share with you every quarter, not only starting June. Every quarter we share our expectation in terms of conversion top line, impact on bottom line, which is the mix of conversion and hedging, and try to catch up. It will be a very complicated things to estimate all along the year. Bearing in mind that we are an organic growth group, so we are looking at organic growth level. It's very important that the KPIs, the key KPIs are organic. Previous year exchange rate and so on. I understand the need for you to also try to estimate the published EPS and the P/E along the year. Once again, I will be more precise and end of June, also because the currencies are quite changing every day, in a crazy way at this moment. In terms of travel retail performance. For full year 2021-2022, the performance was very good compared to the previous year, around +50%. But still, if you compare to two years ago, around -60%. The short term is booming, but the values are not meaningful. We continue to increase, but we do not seem to be back to the old level until 2023-2024 or at least 2023-2024. We are increasing our performance but on a very small base compared to the old good days. All regions contributed to this short-term performance, positive performance. With the small exception, which is the Asian travel retail, which is less dynamic, the Americas, and the European travel retail. This is most important because it is in Asia that used to be the most important part when it is talking of the travel retail business. Better on the short term, not yet at the old base level and no normalization, in our opinion, before 2024. In terms of China, can you repeat your question because there was some noise, I didn't understood correctly the question of China. Yeah, no worry. Just yeah, you flagged the presentation that was a low season, so it doesn't really matter too much. If you could comment on the current depletion that you're seeing perhaps in April in China, and also how much of your sales are coming from cities like Shanghai or Beijing. In terms of the actual run rate, both in top line and bottom line, the situation is, in some part of China, blocked. It is not the major part because maximum we can say that 30% is concerned because Guangdong and Fujian are making two-thirds of our sales. We are not so much exposed compared to other peers to Beijing. Shanghai is important but is clearly far less important than Shenzhen and other parts of the country. In terms of consumption, everything is linked to the decision of lockdown because compared to, for instance, Covid in the Western world, you are less free to move to buy. Everything is much more blocked in this part. The good news for you was clear for us is that the weight of Shanghai and Beijing is clearly not so important to compare to the south part of China. Clearly, we have also other elements to consider, not only consumption but the operation, because strict lockdown impact the daily way to do business in terms of logistics, how we move goods or in all China. This is still something that need to be said. Then progressively, maybe it will change in the next coming days or hours, it will be more positive, the dynamics will restart. Once again, because on top of the fact to be less exposed to this, Shanghai and Beijing areas, our stock level, I insist, are very low. Okay, thank you very much. The next question comes from the line of Simon Hales from Citi. Please go ahead. Thank you. Morning, Luca. Morning, Célia. I think three for me as well, I'm afraid. Luca, can I just sort of follow up on those comments just around China at the end there? I wonder if you could just give us any idea of the seasonality over the next sort of two to three months, you know, of your Chinese business. How do we think about sort of April, May, June, July in the context of, you know, of the year? And then related to that, you know, obviously, you know, you've stressed how low inventory levels are, you know, for cognac, you know, in China at the moment. Given what's going on, even if less than 30% of your sales base is being impacted, you know, stay-at-home restrictions, is that stopping wholesalers at the moment wanting to take on more inventory as we come into the Q1 of our fiscal? That's a rather long-winded first question. Then secondly, you know, you've clearly been upweighting investment, you know, across the business, through the year and through the second half of the year. Have any of the situations with regards to the restrictions in China, had any impact or delay to some of your investment plans, in that market? Then finally, I wonder if you could just talk a little bit about your Russia and Ukraine exposure and how you see the impact of that situation there, sort of hitting, you know, sort of the group as we move into the new fiscal year. What costs are you continuing to carry in relation to your import business into those regions? Okay, thank you. China business split and weight in terms of phasing. Mid-Autumn Festival, Chinese New Year, 11.11, 12/12, special days are accounting for two-thirds of the business. Q1 for us. April to June is low season. It's not significant in terms of value, or it is not important. Logistics and global dynamics disruption can limit intermediate movement and restocking, even if we are talking out of the specific lockdown areas. Yes. That is why, even if the global nature of the business is less China and India, our competitors clearly would like to have a progressive lockdown easing situation to be able to restart to work like a normal situation, because otherwise it's not so easy to operate like that. Our teams are very spot on the ground in China, so they think of a whole solution to try to offset some situation following the rules and respecting all the rules. We are there, but clearly, the lockdown conditions are stricter in China compared to Western world and play a role on the way operations are conducted. A&P, regional balance. Yes, we switched some investments in March, more in the U.S. and other parts of Asia. We were very successful as I highlighted, and less in China to avoid to have some direct, not brand long term oriented investments. I'm talking more about the more linked to the volume sales part investment, rebalancing that by regions. You can read. You will see during the June results presentation. I confirm to you that our AMD growth was important in the second part of the year, feeding the ambition not only for this fiscal year, but the starting and supporting the strong rebound compared to two years of the new paradigm and the consumption. In terms of Russia, Ukraine situation. For us, when Peter is speaking, Russia and Ukraine are marginal in terms of weight. We are clearly saddened by the tragic events that have impacted Ukraine, and since the priority of the conflict, our priority has been not on the business, not only on the business, but even more clearly to do everything we can to protect, support, and help our colleagues in both countries. Together with all Comex members of our team across the world, we have expressed our sadness and compassion, but also in more concrete way, mobilized all means to help Ukrainians to get the essential products they need, to give some financial support to our distributor in Ukraine, and also to find the best option to welcome sometimes refugees, not only in France. Also, we've done the same thing with our Russian cooperation, collaboration with our employees. We continue not to sell to Russia. We maintain our operation there to be ready if the situation will allow us to do that, to reopen the operation. Because we are not a political institution, we are clearly attentive to that, but we are there to support all the people and to profit the business in a healthy way when the condition will be there. Concretely, our last shipment in Russia was in January. Since then, we have suspended all our shipment execution plan until further notice. We support all the people in Ukraine and in Russia as well. We believe in diplomatic efforts, and we hope that Ukraine and Russia will find out the peaceful solution of the conflict. In terms of last but not least, as well we said at the beginning, in terms of the impact on our figures, Russia and Ukraine are marginal, less than 1% top line, and not so important in terms of bottom line. In terms of brands, a little bit more important for METAXA, Chivas Regal, and some part of our cognac portfolio. At group level, I repeat, very marginal. That's brilliant. Great, Luca. Thank you. The next question comes from the line of Andrea Pistacchi from Bank of America. Please go ahead. Good morning, Luca. Morning, Célia. Three from me also, please. The first one on the US, where underlying trends clearly remain strong. In fiscal 2022, I think you delivered low single-digit value depletions on what were very difficult comps. Now, this year comps are normal, and you flagged the strong pricing that you're taking. What sort of depletions do you expect in the US? Are you able to quantify the value depletions, and would you expect volume depletions to be positive? The second question, just going back to the point about FX. I mean, without, of course, giving us any number yet, it's premature for the new fiscal year. Can you remind us the hedges? Are they typically 18-24 months out, or are they shorter than that? Please, the last question. You said in your guidance that you're anticipating a strong start to the year. Now, there are a lot of moving parts affecting Q1, the positive underlying trends, the restrictions in China, stock replenishment, et cetera. Can you, I mean, just in broad terms, talk about how these moving parts move in the quarter, and when you say strong, I mean, how strong is strong? I mean, you're not going to give us numbers, but a bit of flavor of how what you mean by strong, please. Thanks. Thank you, Adrian. Let's start once again, if you allow me, with the technical part. I will give you, so far our 2022, 2023 hypothesis, okay? To try to give you some help, but I will adjust this estimation beginning of June, and I will do it again every quarter during the sales conference because it is important, this year, even more than previous year. If you consider that our universe of coverage of hedging is 100 USD and CNY, the other, the whole basket of currencies linked to dollar in a way, have a weight of 91%. We are really very dollar dependent. So far, for 2022, 2023, we hedged 80% of our estimated needs at a granted coverage of 1.18. 1.18 because, as you remember, we cover 24 months in advance, so we have some crystallization of the cost of the option, of the volatility and the time value. Thus, 60% of this 80 is with options, meaning that spot changing, we will progressively reduce this 1.18, or if it is negative, we have a blocking loss point of 1.18. Normal discussion for technicality like that. My personal and our personal estimation for 2022, 2023 at yearly level, so a conversion rate at 1.12. A spot rate at 1.05, that combined with the 1.18 of the 80% with option of the hedge, makes an average all weighted hedged rate at 1.15. At this stage, so far, we have 1.12 in conversion top line and 1.15. It is too early to give you the absolute value that will impact. We have a specific spreadsheet during June presentation. Clearly, if we continue like that, published result in 2022, 2023 will show a much more accelerated impact in bottom line compared to the EUR 5 million of this year. This is clearly linked to our strategy and the fact that the spot rate at this stage is 105, 104. Everything can change because everything is more volatile than ever. I hope it is at least clear. The second point, US depletions for the year. Despite volatility by quarters that will continue to happen because you have to combine strategic management by us, a world in which logistics is very tense and some geopolitical tension, the underlying new paradigm is confirmed. What is... What I mean is that at group level in the US, we target another strong year, both in top line and also in depletion. Having ended the year with a low level in some key SKUs, the catch up and realignment with new paradigm, considering also the complexity of logistics operation, will determine some volatility during the quarter. All in all, i.e., at yearly level, we target a strong year for the US, both in top line, in terms of shipment and in depletions. What is strong for the US? Clearly, we are talking about very high single to double digits, double digit in the years what we already realized over two years, which is quite important. Why do you think 8%, 9%, and 11% is not so big? Don't forget that the new paradigm in US like all over the world, it is our business visibility. We are talking of +60%, maybe +11% over +60% over two years ago. We are accumulating, stratifying, clusterizing additional growth and saying in a world that the user base of account become part of the pyramid forever. In our opinion, it's very important target, which means knowing that we consider the market for the US being mid-single%, continue to gain market share in value. Because all the figures I gave you, top line, shipment, and divisions are value oriented, right? I don't think that we will add another year of double-digit% volume growth. It's not our orientation, because the price and mix increase will be far higher. All over the world and in US in 2022, 2023 compared to the 2021, 2022. That keeps even more profits and for the year 2023, 2024, and 2024, 2025. In terms of what is strong in Q1? Let me allow to be a bit long also that, because it's important to try to explain the way we are thinking to that. First of all, I repeat, we are today fully focused and very confident for the year 2022, 2023. We entered the year with a lot of serenity, calm, zen attitude, even if the global context is very complex. We are very well positioned to take advantage of new paradigm in consumer trends, our market and mixology growth. We can rely, we said, on very strong pricing power, higher positioning, strong brand visibility, and the impact of the fact that our strong advertising promotion long term campaign are becoming effective. In Q1, we expect despite the very high comparison base in China, which remains characterized by the pandemic so far, a strong start to the year. What is strong? It is double digits. We expect a group level combining all opportunity and risk so far in organic sales growth in Q1 at double digits. By region, we expect a strong double-digit growth in the U.S. because consumption is there. We said +60 compared to two years ago, and we are low, so there is a realignment. We continue to monitor the evolution of lockdown in China. As said, when it restarts, the dynamics can be reopened. The underlying demand is there, +60%, same figures over three years, and we are very under stocked compared to our best competitors with the right portfolio, in our opinion, to profit from that. Europe is quite aligned, and it's a little bit more normalized. We have the war in different parts, but so far more normalized than in the past. Starting to compound in terms of performance with the rest of the company. This acceleration will translate if we consider that your currency translation, like increase of stock. I prefer to talk about a realignment because it's not increase of stock. You have 10 people coming to your dinner. Everybody eats one chicken. You have 3. You get 7, 3. Now you do another dinner, 1 week later. You have already all these 10 people, it gives them 6. So you are doubling the stock always, but it's still under reacting to the final demand, which is 10. So even if it's doubling the stock, you are still under stocked. We are in this situation in a lot of countries. The restocking technical effect will be quite low, which is good because with a strong double, it will be strong double in U.S. on the heels of underlying realignment and not on the heels of stock adjustment. 1 to 2 weeks in the SOP, a maximum of 1 to 7 days of the year. We will enjoy a realignment that is not a window dressing restocking impact in the quarter. That's very clear. Andrea, let me allow to end with a final word. Yeah. We have all collectively maybe stepped back and think a little bit, sometimes more strategically. I'm talking to myself, huh? No, not you, myself. Quarters are important. Where is the company? We have to publish results quarterly. We have to talk about metrics. Sometimes also we have to take a step back and have the big picture. Compared to two years ago, 17, okay, pre-pandemic, US +54%. Asia +30%. Europe quite the same level. In terms of depletion, the best across the entire demand, US +60%, of which 45, 15 points over price mix. China +60%, quite the same balance. Europe high single, low double. Stock decrease and realignment. Compared to pre-COVID situation, we are in a new era and results are very robust. Expectations are very, very strong. Clearly, there are a lot of technical elements problems eventually that we have to manage like every company which is changing year, so the execution is more complex. We are in a very good shape. Thank you so much. Brilliant. Thanks, Luca. The next question comes from the line of Travis Stirling from Bernstein. Please go ahead. Hi, Luca. Just one question, Luca. You'll be glad to know. I'm trying to pull together a number of threads you mentioned, Luca. In particular, focusing on the U.S. and the shape of the business as we move into the new fiscal year. I think you mentioned we ended the year with very strong growth or shipment growth for 1738, but VSOP in decline. I know you're short of aged eau de vie, and yet at the same time, you clearly, as you say, you don't want to give up on VSOP. Is it sort of inevitable that in the U.S. at least, you've got to continue to prioritize 1738, and we'll see that pattern going forward of maybe not VSOP in decline, but that the growth will come primarily from 1738? Is that the right way to think about the U.S. business for the next 12 months or so? In volume, yes. We have an expectation to be able, in value with the optimization, VSOP will be maybe slightly positive or equal, flat. In volume, yes, it's not a priority. 1738 will be for the intermediate, the Q1, the H1. On top, we have huge expectation and very good result on the LOUIS XIII and then XO as well. There is a progressive global portfolio up-trading that is there right now. Don't forget, out of cognac that we are starting to realize what we said two years ago, what Éric Vallat said. The journey, medium to long term journey, will be based on cognac, but we also realize as the final goal, the volume driver over the years of our plan will be liqueurs and spirits. Okay, in the UK, parallel, so liqueurs and spirits are starting to overperform compared to cognacs and in the US as well. Cointreau, even if on a very high basis, will be there. With a strong valorization as well, worldwide. Whiskies, it's quite fantastic what happened this year in China and all over the world. The fact that the cognac is important, is the base, but it's not the biggest driver in terms of increase impact gives us additional serenity. Personally, I prefer serenity than confidence. When you are calm and serenity, you are really concerned, but you know, in a zen way, zen attitude. To realize it's important, but VSOP will not be asked for that. It's very important. Understood. Thank you very much, Luca. The next question comes from the line of Chris Pitcher from Redburn. Please go ahead. Good morning, Luca. Thank you for the question. Following up from Trevor's, in terms of how the sales mix is changing in the US, can you give us a sense for how your customer profile is evolving? Is this the same drinkers trading up, or is your balance of customer moving up the income bracket? Perhaps globally, could you give us a sense for how the LOUIS XIII customer is changing? Because you've seen very strong growth globally. Can you give us an idea of what the profile is, sort of by nationality and income bracket, if possible? Just one quick question on currency windfalls. Is your strategy to reinvest any dollar benefit that you may see from transactional gains? Thanks. Okay, I'll start with the Forex once again, because there we have 1 point. Even if we never experienced a very, very strong disruption of positive impact of Forex during my permanence as Financial Director 9 years so far in the Group. The Group is monitored, managed in organic terms, and the Forex positive, negative is always something that is explained but is not changing our strategy on a daily basis. Clearly, if next year we have, I don't know, EUR 40 million, EUR 50 million, EUR 60 million plus or minus in a published result expectation, clearly it's possible that Éric Vallat would ask myself to reduce a bit investment, the overhead, or to increase that, because the magnitude of Forex impact has never been so big. This year, it could be. It could be. We continue to manage the Group in terms of organic terms without taking into account some tactical implication linked to Forex. Consumer change is clearly more sophisticated, clearly more trained. We talked about the COVID pandemic period to be touched in a different way. We have less revenge spenders than we thought, and more conscious consumers, conscious with a trading-down habit compared to the previous expectation. On-trade has been back to our previous expectation, but we didn't lose major brands or volume priority brands, the off-trade resilience. It is more educated and drinks better in terms of volume, drinks less. Indirectly, even if we are sometimes shy, not bullish on that, we are contributing to the ESG footprint indirectly. Our strategy is a positive in terms of ESG. It's very positive because it is a healthy consumption and a lower consumption than other companies, if I may. The journey will drive a better acknowledgment by the consumer, in our opinion, in terms of values. LOUIS XIII is a successful combination of the advertising and promotion, company brand awareness. More widespread in terms of sales is China is still very important, but it's not only China. US has performed very, very well. Some countries in Europe as well. It's widespread. I think we think part of that is the enormous investments that we made and since 2014, 15, with brand ambassador and personal client director, people that on the ground on a day-to-day basis are able to explain, like, taste, enjoy with the director consumer the precious LOUIS XIII. I can say that we switched when I arrived in 2013 in the depths of the China crisis, was a beautiful jewel. Today is a very beautiful drink that is more consumed than before because our consumer has less fear to drink it, they are more at ease drinking that, experiencing that than in the past. You have less respect in the terms of like you have a jewel you keep it in a safe lock. It's less on the safe lock. It's more touchable, more achievable, more down to earth, even if it's a strong price. It means that in terms of education, advertising, promotion, and I insist the activities on a day-to-day to our brand ambassador, our PCD. Not a lot of company who have the courage to put 100 people on the field, but immediately also our organizing to that, to support the progressive journey to the knowledge of that. Now I think that we are collecting the first result. On top, more and more being direct with our operation into freestanding stores and also some economics positive impact. The more will be accredited. Probably in five years we'll have much more sales than in 2012 with Louis XIII, with maybe two-thirds of the volumes we used to do in old days in China with classic gifting. Classic gifting is no more the core business of the Louis XIII. Thank you. There are no further questions in the queue, so I will hand the call back to your host for some closing remarks. Thank you for your questions. Very interesting as usual. I can say see you beginning of June with a set of results. As you understood, we are aligned with the consensus. We see that our profitability will improve compared to previous year. We have expectation, confident, and very good expectation for the next fiscal year as well, top line and bottom line as well. You also have the occasion in June to ask a lot of strategic question to my boss, Frederic Bohler, that he will illustrate how we continue to perform and our track record compared to the ten-year plan. We are right in a slightly better position than two years ago. You have understood that. We are a company which is now operating in a different mood and with different underlying views. Thank you so much, and see you in June. Thank you for joining today's call. You may now disconnect your line.