Welcome to the Watches of Switzerland Q3 trading update. My name is Juan, and I will be coordinating your call today. If you would like to ask a question during the presentation, you may do so by pressing star one on your telephone keypad. I will now hand over to our CEO, Brian Duffy, to begin. Please, Brian, go ahead. Thank you, Juan, and good morning, everybody. Thanks for joining us. I'm joined by Bill Floydd, who's our CFO, appointed at the start of January. Bill joined us from the Rank Organisation. There's also Anders Romberg, our former CFO, who'll be retiring at the end of February. Bill and Anders are working a transition over this couple of months. Also Caroline Browne, who's our finance director. We've got a bit of finance firepower so if they can't answer your questions, we're in serious trouble. Assuming everybody's been through our RNS and reviewed the numbers, I'll just add a wee bit of color to what you've seen already. What I noticed is obviously the market's strong, continues to be strong, and is characterized by demand exceeding supply. We can never fully evaluate demand overall, but our feeling is that if anything, demand is getting further ahead of supply overall. We delivered 28% growth on last year, 20% in the U.K., 45% in the U.S. Really important to point out the change in mix that's happening. We have a super high demand brands as we're calling them now Rolex, Patek, and Audemars. Clearly what we sell in those brands reflects what we get in the way of intake. The intake from those brands has been completely in line with what was indicated for the calendar year. Obviously the sales on those brands just reflect the phasing of that intake overall. The other brands and all other similar brands that include Cartier, Omega, Breitling, TAG Heuer, Panerai, IWC, really great brands. We had a really fantastically strong performance with them, U.K. up 79% or 78%, excuse me. In the U.S. up to 114%, so a tripling of the business that we did with those brands in the quarter. Overall, as a group more than doubled to 112% on last year. We also had a great quarter on luxury jewelry. In the U.K. we were up almost 56%. There's great work getting done by our buying and merchandising team and product development and selection. In the U.S., we were up a staggering 172%, again, almost three times last year. The U.S. numbers, good underlying numbers from Mayors, following the relaunch that we did of the Mayors brands, but also a really important contribution from our new business in Betteridge, who do a fantastic business on jewelry and clearly particularly strong over the holiday season. We also opened our first BVLGARI monobrand store in Miami, which has got off to a fantastic start again. Overall our jewelry business up to 88.4%. What we clearly further got to know our new businesses, our new colleagues with the five stores that we announced that we'd acquired during the year. Very pleased with how that integration and development of those businesses are going and a lot to look forward to, I think, from them in the future. Very pleased to announce our first steps into the EU market. You'll all recall what our plan is, that the EU would become an important part of our business in the years ahead. Our strategy is to enter Europe with a combination of acquisitions and monobrand. The deals that we're able to announce at this point are monobrand that we've contracted to open in Stockholm, Copenhagen, and Dublin. We then looking at our outlook and guidance for the balance of the year, we now have, you know, around 12 weeks to go. We have visibility on supply for the balance of the year. We have the benefit of pricing, particularly Rolex pricing that was implemented in January. Good strong performance in Q3, and it's all led to us being able to now improve our guidance to say that we'll be at the top end of the previous guidance that we gave on both sales and profitability. Our teams are doing an amazing job. Everywhere is an inspiration. Again, I had the pleasure of seeing quite a few of them in the U.S. last week, doing a fantastic job, and we were delighted to give them a wee surprise in December by giving everybody 50 shares in the company. Regardless of level, everybody got 50 shares, U.K. and U.S. We were also pleased to implement and commence a new share save scheme that went out in January. Great uptake in participation on that from all of our colleagues. Really great that all our colleagues are getting the opportunity of being actively interested in our shares. Also delighted that we've had our foundation fully registered in December. We've had two board meetings with our boards. We have GBP 3 million of funds that have been given from the company, GBP one and a half million from last year, GBP one and a half million this year. We've made a first round of donations in December and January to charities, U.K. and U.S. food banks. Crisis, who obviously work with the homeless. Prince & Princess of Wales Hospice in Glasgow, and also the Prince's Trust that we've been working with for many years. Delighted to be able to have done that. I've been delighted with a lot so far. At this point, we'd be delighted to take your questions. Thank you. As a reminder, if you would like to ask a question, please press star followed by one on your telephone keypads now. If you change your mind, please press star followed by number two. When preparing to ask a question, please ensure your phone is unmuted locally. The first question comes from Melania Grippo from BNP Paribas. Please, Melania, your line is now open. Good morning, everyone. This is Melania Grippo from BNP Paribas Exane. I have two question. First, I would like to ask you if you have seen any changes in the environment in both U.S. and U.K. Is there anything that you can tell us? Have you seen any changes in customer behavior or willingness to spend? My second question is on the announced entrance on the European market. Can you tell us if these stores, these six stores, are multi-brand or they also include monobrand? More or less, how much we should account in terms of space for these stores? Thank you. I mean, the first one's easy, Melania. We haven't really seen any change. We had a good Christmas season. It was strong. I think as we reported to you a quarter ago, it started early in November. I think people were happy to be spending and maybe just, you know, motivated by concerns about availability. It started early November, carried on good momentum, both U.K. and U.S. January's carried on with good momentum overall. We honestly haven't seen any change in sentiment or behavior influencing our business overall. The EU stores are monobrand only. They're not multi-brand. We have obviously the next year's numbers and, you know, we're not giving out any specific numbers at this point. We'll give you an update on our plans and our views of fiscal 2023 at our year-end. Thank you. Thank you. Our next question comes from Kate Calvert from Investec. Please, Kate, your line is now open. Good morning, everyone. Hope everyone's well. A couple from me. The first one is, how did the sales mix in the third quarter compare to history, in terms of mix between the super high demand brands and the other brands? My second question is, have you got any views on shortages creeping into other brands? There's been quite a few press articles out there. My final question is on the 5 stores you bought at the end of last year in the U.S., how much could you actually do to the stores in the third quarter in terms of reformatting them, putting different stock in? Or did you sort of basically just sell through the stock that came with them? Thank you. Hi, Kate. We'll answer that in a slightly different order. Your last question, what we'll be able to do with the five stores. Both Minneapolis and the store in Texas, we rebadged and we reformatted. They're both Watches of Switzerland stores now. Upgraded the furniture. Did change the brand mix somewhat. There's only so much you can do short term, but we were able to change the brand mix. For example, in Minneapolis, we took jewelry out. It's a Watches of Switzerland store now. The jewelry that was there before was relatively inexpensive and really not making the contribution. In any event, we're calling it Watches of Switzerland, so delighted with both of them. Betteridge, we practically couldn't and wouldn't do anything. It was a very strong season for them. It's, you know, beautiful stores in Bethpage, in Connecticut and Vail and Aspen. We have plans to expand all three. You know, this will take time to organize and negotiate with landlords, with brands and do all of our own planning and so on. Big plans for all of them. Bethpage at this point, we haven't changed. Anders, you wanna comment on the mix? Thanks, Kate. The abnormality in our sales is predominantly related to last year, where we disproportionately had good supply into the supply-constrained brands and we actively were pursuing click and collect. The penetration of that segment of our business in last year's number was higher than what we normally see. Versus FY 2020, the prior year, obviously, last year spiked up by about 10 points or so. This year we've gone down further than what we were in FY 2020. The growth that we see coming through is entirely driven by the non-supply-constrained brands as well as the jewelry. Your second question, Kate, shortages. I mean, first of all, to have delivered the level of growth that we did on those other brands, we clearly anticipated having a strong period. Importantly, you know, bought in early to good stock levels that enabled us to do that overall. You know, I think the industry in total is enjoying a good period, and inevitably it puts some pressure on production and components and so on. Nothing that unusual. Could we have done with more Cartier Santos and Must? Yes. Could we have done with more Bond watches? Yes. Could we have done with more Endurance Pro from Breitling? Yes. None of it's exceptional. Our feeling is that even the shortages that we've had, production is catching up and we think, you know, by the end of our financial year we'll be in a good situation. I think really importantly, you know, for us as big partners to these big brands, we are looking to longer-term commitments, longer-term forecasting. I think we've proven the value of that actually with what we've done over this year to date so far. Not a concern. If anything, getting better overall in terms of supply. Thank you very much. Thank you. Our next question comes from Katherine Parker from Jefferies. Please, Katherine, your line is now open. Good morning, everyone, and thank you for taking my questions. My first question is on the European expansion. You've obviously given the three countries for your monobrand store rollout. I wondered if the three same countries would be your prime choices for a multi-brand Watches of Switzerland store, and whether there's any chance of that occurring in fiscal year 2023 as well. My second question is on jewelry. I believe that Betteridge has a higher penetration of jewelry than the Mayors store network, and has been particularly strong in the quarter. I wondered if there's any kind of takeaways from like a merchandising perspective or brand mix or price points that you could apply across the rest of the portfolio. My final question is on Rolex agencies. Of these stores that you acquired in the U.S., at the first half, could you confirm how many of those have the Rolex agencies already? If any don't, if there's potential to integrate Rolex into those stores? For expansion, as I said earlier, the strategy is a combination of acquisition and monobrand acquisitions. It has to be done continually. You know, our priority always would be Rolex agencies and looking at acquisitions. Yes, possible that we would look to represent Rolex in those markets, but obviously it's not completely up to us. We've got to, you know, do our work and see how we can effectively make that happen. We'd like to make it happen. As you might find that, you know, Scandinavia or the Nordics being our first move surprising. What I'd say to that is, you know, Anders and I have great experience of the Nordics as markets with Ralph Lauren and a great success there. They are markets that we think have underinvested from a retail standpoint. There's obviously a lot of wealth and affluence there and good market trends. We've always felt positive about the combined Nordics market overall. Yes, we will look to be fully representative over time in those markets. It's a really good point and question on Betteridge. We actually spent all day Friday with partners with us last week and all day Friday with them, going through the very subject of jewelry and seeing everything that we can learn from the great success that they have. They've been in the markets a long time, are keeping the Betteridge name. Have great reputation in the markets that we're in, very affluent markets. I don't know if you know Greenwich, Connecticut, but it's a very affluent New York suburb, effectively. They've been there for generations. We are learning from them. The average price point, by the way, of what we sold in jewelry was double from last year in the U.S. and largely because of Betteridge. Yes, great things to learn. The market overall, the U.S. market for jewelry, by the way, is one of the best in the world. As some people characterize it as being half of the world market when you look at diamonds. A lot of good things to learn. Also delighted with the success that we've had with our first BVLGARI store as well. The whole subject of jewelry is getting a lot more attention from us based on what we've experienced and the acquisition of Betteridge. In terms of Rolex agencies and acquisitions, the one in Minneapolis was a Rolex agency. The one in Texas is not, but we have exclusivity for that mall, which we now have, and we had pre-agreed that Rolex would come with us into that mall in Dallas, the Plano town. Betteridge has two Rolex and two Patek agencies across the three stores. You know, they're always looking to see where we can expand the representation of Rolex, Patek, Audemars, but also Cartier and the other brands that we've talked about. Thank you. Great. Okay. Thank you. Our next question comes from Richard Taylor from Barclays. Please, Richard, your line is now open. Thanks very much. Morning, all. On the monobrand, should we read anything into the markets that you've entered there in terms of where you'd like to make acquisitions or are they potentially unrelated? Secondly, on the price increases, Rolex, Patek and so on, have there been any change in the margins that you achieve on these sales following the price increases? Do you get all the benefit yourselves or does the gross margin change a bit as the price goes up? Thanks very much. In terms of priority in acquisitions, I think we're open to any acquisition in the EU that comes at the right price. We're not discriminating against any market. It would of course be a benefit to get scale in the markets where we're opening up the monobrand. In terms of our new margins, obviously we had a margin compression two years ago here in the U.K., where Rolex took some of the margins back as part of the price increase in the U.S. and the further consolidation of agencies driving the productivity and allocation by existing price point. They took another 2 points out of our margin as part of that price increase. In the U.S. In the U.S. From January. Yeah. Sort of net of between the price increases and the margin contraction, what does that mean for you as a business? You know, like match the growth. Well, we obviously held our guidance and actually put it up to the high end in terms of profitability for the year. We don't see it having an adverse impact on this fiscal year. Obviously our Rolex business is bigger than the U.K. The price increase and the benefit on ongoing profitability per unit plus the stock that we've acquired at the previous and in the U.S. is a bit more of an offset. This links back to what we said in conjunction with the LRP, that we hadn't included any, you know, sort of pricing in our long range plan as beneficial from a margin perspective. Because our belief was that at various stages throughout that journey, there might be, you know, changes as productivity reaches new levels from the brands. This is, you know, just proves our theory, I guess. Thank you. Okay. Thank you. As a reminder, to ask any further question, please press star followed by one on your telephone keypads now. The next question comes from Carina Schuster from Goldman Sachs. Please Carina, your line is now open. Hi there. Thank you for taking my question. I have two. One is more for follow-up on the previous question. You know, we have seen Rolex doing price increases and also Patek Philippe also cited in the press in terms of price increases. Are you seeing some of the other less supply constrained brands in the traditional sense, following suit in terms of price increases? And just your thoughts on the pricing environment more broadly, for this year would be fantastic. And then the second question is to Floyd, if I may. I know it's early days in you joining the company, but it'd be great to hear what excites you most about Watches of Switzerland and the transition. Thank you. Yeah. That's gonna be an easy one for Bill. It's clearly working with. I think there will be further price movements, by the way. We've had Omega price increase along with Rolex and Tudor price increase revised. And the underlying conditions, strong Swiss franc, increasing commodity prices, increasing, you know, gold, diamonds, whatever. I think the conditions are such that it would make a lot of sense for all the brands to relook at their pricing. But we'll hear more I think in the months ahead. Very little movement at this point from Richemont or from the LVMH Group or from Breitling. But we'll see. All we know about at this point, Rolex, Patek, Tudor, and Omega. Audemars took their pricing up by 6% in the U.S., but it's obviously only one point of distribution, so not really material. Yeah. Okay. Bill? Morning, Carina. Morning, everyone. Yes, I started beginning of January. It's been, first of all, I just wanna say it's been great having Anders here to help me through the first couple of months. It's been a very helpful start from my point of view. I've spent most of my time trying to meet as many of the people in the organization as I can, get out to the stores within the U.S. and Florida last week, getting an early sense of that. I have to say it's a fabulous organization. Brian and the team have done a great job. You know, what I'm looking forward to most of all is the scale of the opportunity that we have over the next few years in the U.K., in the U.S., and in Europe is brilliant. Really looking forward to helping everybody execute on that. Okay. That's really helpful. Thank you. We currently have no further questions, so I will hand over Brian Duffy for any final remarks. Thanks, man. Very little to add. I'm delighted with the quarter overall. The view is that uncertainty and disruption is on the way out, and we're not expecting any further disruption. As a matter of fact, normality we think is at some point in the horizon and getting closer. What that might mean, we've been through all of our budgets now and looking to finalize them and present them to our board in the weeks ahead and that will form the guidance that we speak to you about at the end of this year. Market's good. Our momentum's good. We're really committed to the long range plan that we presented to you all. You know, just great job done by our teams everywhere. Great to have Bill on board and the transition. I think it's working very well with him and Anders. All good. Thanks for your support. Thanks for joining us. That's all we have to say. Thank you. This concludes today's call. Thank you so much for joining. You may now disconnect your lines.