Good afternoon. This is the Chorus Call conference operator. Welcome, thank you for joining the Intercos Group full year 2022 results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Renato Semerari, CEO. Please go ahead, sir. Thank you very much. Good evening, everybody. Very pleased to speak to you today. In a year marked by unexpected disruptions coming on top of the expected supply chain instability, Intercos achieved very strong results. Q4 came in better than expected and allowed us to close 2022 with net sales at +24% versus year ago, +19% at constant rates. Adjusted EBITDA at +20% versus year ago with a 14.6% margin. Adjusted net income at +25% versus year ago. Net debt slamming for the first time, the EUR 100 million threshold and closing at EUR 91 million with a low 0.74 leverage on EBITDA. Good confirmations on the ESG front with the EcoVadis rating coming back again with a Platinum medal, putting us in the top 1% of companies in our sector on a global basis. Based on the above results that you can see summarized at page four of our presentation, we will propose to our shareholders assembly the distribution of EUR 16 million in dividends with a payout ratio of about 36% of net profit. Zooming on the Q4 results, if you move to page five, you will see that in Q4, we have achieved a +27% net sales growth, +22% at constant rates, with a 15.6% EBITDA margin, which is clearly an acceleration versus the previous quarters of the year. This translates to fixed cost absorption linked to volume, as well as to the pricing activities we've carried out in the course of 2022 to compensate as much as we could inflation. Let's now look at net sales results in more details. If you turn your page, you will find our results by business unit. Q4 saw makeup continuing on its fast pace and hair and body accelerating while skincare continued suffering from the China issues. Makeup confirmed weighing over 65% on total sales, while hair and body gained weight over skincare, thanks to the impact of the delayed projects we mentioned from semester one, and also the first quarter of production for Dolce&Gabbana. Makeup recorded in the quarter a +30% increase over a year ago to close the fiscal at +31%, which I judge a very, very strong result. The Western world, the EMEA and U.S., were the main drivers, thanks to the excellent performance of emerging brands and multinationals that we will see in a moment. Hair and body went up to +47% to close the fiscal at +24%. On the other hand, skincare registered a slight decline, which led to a modest growth in the fiscal at +2%. Moving to the next page, you will see the results by region. Q4 was marked by the exceptional performance of EMEA, followed by Americas. EMEA went back to 50% of total sales, with America at over 30% in terms of weight. EMEA went up by 38% in the quarter to close the fiscal at +24%. Americas grew 29% in the quarter, closing the year at +34%. Asia was flat in the quarter, closing the year with a double-digit growth at +10%. Given the difficulties of the year, I judge as a very strong result that in our case was clearly led and tracing to the Korea exceptional performance in the year. Moving to our customer types, emerging brands confirmed their role as growth drivers, now weighing over 40% of total sales. Multinationals also displayed double-digit increases, reducing however their weight to 44% of total. Retailers lost share of total sales, this was mainly tracing to retailers from China that affected the overall result of this cluster of clients. Q4 was marked by exponential growth of emerging brands at +71%, which closed the year at +45%. Multinationals confirmed their double digit pace with Q4 at +13% and fiscal at +19%. Retailers registered the first negative quarter of the year, -10%, still closing the fiscal slightly positive. I now pass the stage to Pietro, who will take you through more details in the financials. Now let's give a closer look to the P&L and the cash generation of the group in this fiscal year. As already pointed out by Renato, we had an incredible year with sales up 24% on prior year, +19% on constant currency. Also what is very important to point out that even on value-added sales, we basically had the same growth with a +23%. We had a wonderful acceleration in the last quarter with sales up 27%, 22% at constant currency. Basically, this growth was mainly achieved through an increase in volumes. We have been able to grow in all geographical areas and in business units. We are back to a level which is much higher than what we have achieved in 2019. Very important to point out is the gross margin that we have been able to keep basically flat on versus a year ago at 21.4%. That gave us the possibility to achieve EUR 122 million of EBITDA growing 20% on prior year. What I would like to point out is the result that we have achieved in adjusted net income. Adjusted net income was at 51.3%, 6.1% on sales. This is also thanks to the financial expenses that remained basically flat versus a year ago, thanks to the favorable condition that we have on our credit lines that we have hedged back in 2020. Very important also is the cash that we have generated in the year. The cash conversion is at 30%, this gave us the possibility to reach a low level of net debt below EUR 100 million with a leverage ratio at 0.74. If you flip the page to page 10, you can see the profitability by business unit. Makeup was had an incredible year. We have been able to increase the EBITDA generated in this business unit by 34%. This despite the inflation that we had and all of the supply chain difficulties that we had to go through. Strong sales that we have generated gave us the possibility to absorb better all of our fixed costs. We have been able to increase the profitability up to 15.7% on sales. Skincare was basically flat. It was following in terms of profitability and in terms of EBITDA generated. This followed basically the same result that we had on sales. Hair and body, as you know, we have hair and body is mainly skewed to contract manufacturing. Here we are much more exposed to all of the variations that we have in product mix, production efficiency, and also the heat that we might have from the cost of energy increasing. For this reason, here we had a downturn in the profitability. It is important to point out that in the second half of the fiscal year, we have been able to generate a positive gap versus year ago with a EUR +1.1 million that decreased the negative gap that we had versus one year ago. If we give a look to the cash flow. Cash flow, we generated EUR 36 million of cash, EUR +6 million versus a year ago. This despite the higher level of CapEx that we incurred in during this fiscal year. As already announced, we are increasing the level of investments in the group. We have increased the CapEx by EUR 12 million, and also despite the higher absorption of working capital, also due to the increased level of inventories that on the other hand allowed us to being able to generate production and income. Okay, if you turn the page, we're now gonna look at the outlook and guidance. Overall, I must say, I'm really scared to say it, for scaramantic reasons, that the picture ahead looks certainly better than what we had last year at the same point in time. In the sense that, yes, there are clouds about possible recession, it looks like it could be faster and less intense than what was predicted at one point. Yes, we're gonna still have inflation, it looks like at least from a raw materials and energy standpoint, especially in U.S. and Europe, the inflation peak has been reached already. We need to expect wages going up, that for sure, but that should be a more predictable kind of inflation going forward than the one we have been witnessing in the past 12 months. The great absent of 2022, which is China, now that the COVID measures have been released, should allow us to see a rebound of the Chinese market, especially in the second semester of the year. This looks a global environment that leave us quite optimistic about the future. First of all, we said it several times already, but I want to underline it once more. We are in an industry that has always shown resilience during economic downturns. We believe that our diversification in terms of market segments, customers, geographies, will allow us to benefit from this resilience. The second point is that in the past 12 months, we've been able to show our pricing power, we have been increasing prices twice in the course of the year. Since we expect that we know that wages are going to go up, we just conclude that all the negotiations for a further price increase that will become visible starting Q2 of this year, that will allow us to offset the impact of wages increases that we are expecting. The last point is that as anybody in this industry, we are very happy about the reopening of China. The rebound of the Chinese market will help the industry to grow, and will help also Intercos to grow, especially in consideration of the fact that we still have ample room for improvement in terms of market share in China. We look at China as a growth engine for Intercos in the future. Given all this, and given the trend of order intake that we have had so far, we are giving guidance in terms of net sales for fiscal 2023 at constant currency to grow between +8% and +11% versus fiscal 2022. As I said, we have kept seeing orders coming in at a very strong pace. We have not seen any significant slowdown, you will see that in a second. On the other hand, I still believe that we will see a softening of order entry at one point in time, 'cause the we have a lot to digest in terms of order book, and we need to shorten the lead time of deliveries to our clients, to regain a very sustainable position in terms of service. If you move to the following page, you will see the trend of order intake. The last number you saw, I think, was related to the period September, October to the 2022, which we had, where we had EUR 109 million worth of orders excluding hair and body. In November, December, we registered the all-time high in terms of order entry on a bimonthly basis, reaching EUR 123 million, and followed by a still strong EUR 112 million in the period of January, February. There was a peak, but the peak was not followed by a sharp decline. It was followed by another strong bimonth. I must also say that the forecast, as you know, the hair and body business is not on a firm purchase order system, but is based on rolling forecast. When we look at the rolling forecast in hair and body, we also see a very positive evolution for our for our business there. If you turn to the next page, you will see the status of our order book at the end of February. We have in our books, orders for EUR 327 million. This is a 3% increase versus the order book of last year. Very solid. Again, we need to work, and we are working hard to digest a bit of this order book, which is still higher than what it should be to provide clients with the speed to market that they are expecting in our industry. I think that that's all on our side. We are ready to get questions. This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone with a question may press star and one at this time. The first question is from Anna Frontani of Berenberg. Please go ahead. Good afternoon, Renato, Pietro, Andrea, and congratulations on the results. I would have three questions for you today. The first one, if you can please quantify the contribution from pricing and volume to your top line growth. I appreciate Pietro said it was mainly volume driven, if you have the numbers, it would be super helpful. Second question on the supply chain, if you can provide an update on the lead times, at the time of the nine-month results, you said that you didn't see an improvement, but that you were better equipped to deal with the status of the supply chain. My question is, has anything changed? The third question is related to the health and sustainability of growth in emerging brands, because we have seen a lot of successful story when it comes to emerging brands in the past years. It is also true that recently some smaller influencer TikTok brands have taken some steps back. Can I ask what do you see from your side and how potentially Intercos would be affected in case of these beauty influencer brands falling out of fashion? Okay. Ciao, Anna, first of all, thanks for your questions. All in all, answering to your question, our growth was mostly volume driven. All in all, pricing accounted on a global basis at 4% of the total. It's a limited impact all in all. Volume has really been the year for us this year. Supply chain lead times. Well, things are not really improving in terms of lead times. They have improved substantially in terms of reliability of supplies. Now we are able to start shortening the lead times to our clients, thanks to the inventory we've built in a more predictable arrival date of raw materials and packaging materials. If your question is though, are we back to a normal delivery time to client? The answer is no. We are still a good three, four weeks longer than what we should, what we should have. That's why I'm saying that, you know, we're working hard to shorten this lead time. We don't believe that the industry can stay with these lead times for long, we need to find ways to be more reactive no matter what, no matter how long the lead times of raw materials are to be faster in producing and delivering to our clients. We're working on that. We are doing improvements. We are not yet where we should be. Emerging brands, first of all, I forgot, and I apologize for that, to mention that as of Q1 of next year, you will see some movements in the brackets of our reporting between multinational and emerging brands and retailers to reflect what has happened in the past year or so, with multinationals buying certain emerging brands. Not to name anybody. Charlotte Tilbury has been bought by Puig, Chantecaille has been bought by Beiersdorf and so on and so forth. At least one important retailer took a different distribution avenue and went to a multi-brand distribution channels in certain geographies. We will move from retailer to emerging brand. Obviously, when we will present you the data of quarter one, we will do a reconciliation of what it was of the past so that the numbers you will be seeing are comparable. Coming back to your question, emerging brands, we are not seeing any weakness in the emerging brands. We are, all in all, we are following. Yes, there are a couple of Californian emerging brands that are not as, you know, growing or successful as they used to be. In the meantime, we had other emerging brands that have grown significantly and are still in a very positive phase. As you know, we are quite picky in terms of what are the emerging brands we decide to work on. We tend to select the ones we believe have the highest potential. Obviously, we have done some wrong choices in the past, but by and large, we have been pretty accurate, and we've been spotting the right ones. Also, now that China is reopening, we are expecting some of the most successful emerging brands that are working with us to go massively into China, into new regions, especially into China. We know that because they request our ask all the regulatory documentation needed for the Chinese registrations. We know this is coming and it's real. Am I afraid of what is gonna happen in fiscal 2023 in the emerging brands? No, I'm not. Will we have some emerging brands suffering? Yes, for sure. You know, all in all, I think that the roster of emerging brands we're serving is very solid. I hope I've answered to all your question. Yes, very clearly. Thank you, Renato. The next question is from Kate Rusanova of UBS. Good evening, Renato and Pietro. I have three questions. First of all, a quick follow-up on the potential of western emerging brands in Asia. Is this more of a medium-term ambition, or we can already see some material benefits of that in 2023? My second question is related to the Dolce&Gabbana partnership. Do you now have more visibility on the potential size of this opportunity? How material was it in the fourth quarter? Since packaging is a considerable cost component for fragrances, how do you expect this to impact the operating margins for the group? Did it already have an impact on hair and body division in Q4, margin-wise? Lastly, continuing on margins, in your outlook, you do not talk about profit development this year. Why is that? Are you comfortable with the current consensus for 40 basis points, adjusted EBITDA margin expansion year-on-year? Thank you. Hi, Kate. Thank you for your questions. Western emerging brands in Asia, as I said, we know who is going because they need a lot of documentation to do the registration. Some of them are already present, but in a very marginal way. I'm expecting them to start pushing and investing with consumers and marketing activities to expand in China now that things are opening up. Do I know how much is that going to weigh? No, it's too soon to assess. As you know, China is just back from the Chinese New Year. The market is still a bit wobbling. I think the first moment of truth will be the big e-commerce event of mid-June. We will see there if the brands have restarted investing in marketing and promotional efforts in a serious way. We will see what is the stance and the attitude of these emerging brands at that point. You know, in terms of pipeline alone, having new brands coming into such a large market of, like China cannot have a negative impact on us. It can only be positive. Obviously, the more they invest, the more they grow, the better for us, but that's a bit too early to assess. Dolce&Gabbana, I always said, since we signed the contract that we were expecting Dolce&Gabbana to be in the top five, top 10, sorry, of our clients. It's confirming that. The forecast we have from Dolce&Gabbana is absolutely in line with that forecast. It's not going to be even at the bottom of the top 10 list. It's gonna be higher up in that scale. I won't give you numbers. Again, it's a brand that works with rolling forecast. It's not like for makeup and skincare, where I can give you a precise figure that cannot be withdrawn. The forecast is very interesting. We're very happy about that. Yes, margin is gonna be impacted because of the packaging costs in Dolce&Gabbana case. That will certainly have an impact on the profitability of the hair and body division. Will also have an impact, and we said it also back in when we met last time. I don't remember. November. November. It's gonna have an impact on the profitability in general of the company this year. Yes, we should be expecting normally a margin improvement linked to the volumes growth that we are expecting. This will be largely offset by this impact in a good proportion. We do not expect a margin expansion in the proportion of what you just mentioned, 40 basis points. We expect it to be lower than that. Thank you. The next question is from Rashad Kawan of Morgan Stanley. Hey, good morning, Renato, and or good afternoon, Renato and Pietro. Thanks again and congratulations on the results. Just a couple from me. The first is on China. Can you tell us how you performed there in Q4 in the full year? I know you talked a little bit about the dynamics this year, but maybe talk about what you're seeing so far in Q1 in terms of dynamics. I know in the release you talk about the expectation of growth being second half weighted. Should we take that to assume that your overall kind of 8%-11% organic growth guidance to also be kind of more second half weighted? Just kind of in the same vein, I mean, with Korea being such a strong performer in 2022, do you expect that to continue this year? Maybe if you can remind us how big Korea is in your portfolio? That's the first question. The second will be a lot briefer, I promise. Maybe talk about if you're seeing any signs of premiumization trends slowing down or whether things are still continuing in terms of premium versus mass and masstige. Thank you very much. Thank you. I'll tackle first your first question, which is a bit more than one question. China ended the year with single digit decline in the region of -6%, -7%. Honestly, I don't have here the result of the of the quarter. You know, all in all, I just saw the results of Cosmax. You know, we did a lot better than them in in China. Okay, sorry. The quarter was -9%, and we ended the fiscal at -7% in China. On the other hand, Korea grew 40% in the fiscal with Q4, there was also double digit up. I finish with Asia, and I then talk about the phasing of the guidance you just mentioned. We expect next year China to rebound, as I said. We expect Korea to consolidate the growth of this year. Korea, we expect to see still growth from Korea, but more in the single-digit zone than the +40% of this year, which was, you know, abnormal in terms of growth. We need to consolidate and move on. All in all, we expect Asia to be again in double-digit zone with different drivers, this time driven more than by China than by Korea. Going to the phasing, in reality, we will see more growth in the first semester than in the second semester. It's gonna be an upfront growth more than a growth that is skewed to the second semester. I know that China, and I just said that China will help in the second semester, but reality is that the base we have because of the first semester of last year, is a lot easier than the base we have in the second semester. For that reason, we expect faster pace in the first semester than in the second semester. I hope I've answered all the points you raised in the first question. I'll come to premiumization or trading down in the market. No, we have not seen any sign of any of that. Reality is that if I look at, for instance, the market data from U.S., which still is the market we look very closely because it's the number one market for color on a global basis. Makeup in mass ended the year at +10%, if I remember well. In prestige, it ended at +18%. There have been no real signs of trading down so far. When we speak with clients, and, you know, this is the week where we're gonna see more clients because of Cosmoprof here in Bologna, and we have our own beauty event starting tomorrow. I will know more at the end of this week. The reality is that with all the clients we've been speaking, we are not seeing any signs of slowdown in the market in general. I hope I've answered everything, otherwise, we're here. That's great. Thanks a lot, Renato. Thank you. The next question is from Mikheil Omanadze of BNP Paribas. Please go ahead. Hi, all. Thanks for taking time for my questions. I have three. First one is on the pricing. In very broad terms, what is the magnitude of pricing actions that you have taken this year that will start from Q2? The second question is on your top line guidance. Does not your comment around the Dolce&Gabbana's potential size mean that this +8%-11% like-for-like guidance is rather modest for the remainder of the business? I presume that incremental Dolce&Gabbana sales for three quarters are in the guidance, right? The third question will be around the order book. I was just wondering what sort of order book at the end of 2023 does your like-for-like guidance imply. Thank you. Hi, Misha. Pricing, we have done as an average of +4% in the Western world. It's a lot lower in Asia, is in the region of +2%. I'm always talking reorders, that is, you know, I know that I've said it several times, but when you do your math, it's important that you consider that this only touches 70% of our sales because, you know, new projects are priced when they come. This is the pricing that we've agreed on average with clients. Clearly there are, you know, not all clients are exactly at the same level, but on average, this is what you should have in mind. Yes, Dolce&Gabbana obviously is in our guidance. You know, the remainder of the business, as you say, is not gonna be small. In reality, Dolce&Gabbana is gonna be an important client, but I can swear that it's not enough to make our +8% or +11% guidance. We need to grow a lot more than that with a lot more clients. Remember that every year, we have some clients that all go a bit off the charts and have very high growth. We had a couple of them this year that performed even better than what we are Dolce&Gabbana to deliver. All in all, we are expecting growth from a multitude of clients, not just Dolce&Gabbana. The last question, I'm afraid I've not understood and, you know, in the order book at the end of 2023, I have no clue on where it's gonna end. There are different ways to look at it. To be honest, I hope I to see the order book lower than what is today. I hope it's gonna be smaller for the simple fact that that will mean that we've been able to reduce lead time of deliveries to client and we've been digesting the backlog that we had accumulated in the most difficult months of the year. If the order book goes down because we don't have orders anymore, obviously I'm not gonna be happy. You know, if we have an ordering flow that overall remains strong and consistent, and we end with a smaller, even significantly lower order book than what we have today, I will be a happy man, and I will be spending a lot less time with our clients to calm them down because they're waiting for product. I can only give you hopes, or my personal hopes more than what is gonna happen. That one, I'm afraid I cannot give you an answer. That's very helpful. Thank you very much. The next question is from Francesco Brilli of Intermonte. Good evening, Renato, Pietro, and Andrea. Thanks for taking my question. A couple of questions from my side. The first one is on skincare. Was wondering which kind of recovery are you assuming on your guidance for 2023 for this segment of skincare? If you are seeing some improving trends even in the first months of 2023. The second one is on pricing. You mentioned a 4% average pricing positive impact in 2022. Assuming the carryover of the increases of last year and the additional one for to offset the wages, should we assume something similar from pricing also in 2023? The last one is on M&A. In light of the very low leverage ratio that you have, if you are accelerating or assessing closely some potential targets right now. Thank you. Thank you, Francesco. Skincare guidance, we as you know, we do not give guidance by business unit. It will go a bit too much into details. Obviously, we have an objective to speed up the growth of skincare. As you know, we had very strong performances of skincare in 2020 and in 2021. You know, aside from what has happened in China, it's quite physiological that, you know, you need to consolidate at a certain level before you can restart and re-accelerate. We are obviously looking at the reopening of China as enabler of a faster pace of growth in skincare. You know, ideally we would like to go back to the pace we had in the two previous years. That's gonna be what we work against, you know, it's all dependent on now how quickly things will move also in China and the speed and reactivity of that market. Pricing, no, I mean the 4% again, I repeat myself. If we, if we had 4% in the Western world and 3% in Asia on reorder, which is 70%, it's clear that you're not gonna have, on a P&L point of view, a 4% impact on the top line. It's gonna be more, you know, 2.5%-3% something percent in terms of volume. The growth will still have to come mostly from volume. This is what we work to get. It's our objective every single year. This is gonna hold true for 2023 as well. The third point of M&A, yes, you're right, our leverage ratio is low. We always said we are interested in M&A. We will always be very, how to say? Actively looking. Actively looking at opportunities that are right for us. We will, we will be even more so now that we have a even lower leverage than last year. To be honest, you know, I would be lying to you if I would say that we didn't do it, we didn't do acquisitions in 2022 because we had leverage. We were already at a low leverage in a low leverage position. It's a matter of the right conjunction between the opportunities that come to the market and our ability to have a competitive bid that is not overtaken by someone more aggressive than us. We hope that, again, and I said it in the past already, I hope that the raising, the raise of interest rates, the cost of money that isn't that low as it used to be, would make especially private equity come down in terms of price tags that they put on M&A opportunities. yes, we will be looking at them. That's very clear. Thank you. You're welcome. The next question is from Beltrán Palazuelo of DLTV. Please go ahead. Hello, good afternoon, Renato, Pietro, and Andrea. Thank you for taking my questions. I have three, if I may. I remember our first meeting in Madrid, December of last year. You were stating that you were wanting to increase prices maybe 6%-7%, and maybe the increase would be 5%-6%. I wanna hear that the prices are only increasing 4% in Western and 2% in Asia, but it's what I would willing to know how the conversations went. The second question, I think, your medium to long-term target is 20% of EBITDA margin. When will we start seeing, let's say, the EBITDA margin increase? The question just to understand the return of the growth. Apart from the maintenance CapEx, let's say the growth CapEx that goes over there, what returns, what organic returns does that CapEx have? Thank you very much. Okay, good evening and thanks for your questions. On pricing, I don't remember exactly what we said and what we were referring to in terms of price increases. As you know, we had done two in 2022. One at the beginning of the year, actually at the end of 2021, beginning of 2022, then we did the energy surcharge at the end. All in all, I just stated how much was the price impact on the total of the P&L. Remember that we always have this, a bit of a disconnect because when we talk about price increases, it's natural for us to think about reorders. I recognize that it's not as obvious to you that we're only talking about a portion of what we do, a large portion, but still not the totality of it. You know, as I said, the pricing impact this year was 4%. This is the P&L impact of the price increases, which means that on the reorders was higher than that. It was not happening in one go. It was a six months distance, one from the other. Now, the new price increase that we have negotiated is going to enter into force. It will have, largely speaking, around 3% impact. The negotiation has not been easy, but not because we were raising prices again Is that because we were raising prices when the first signs of inflation having reached the peak on certain elements like energy, like, transportation and things like that. There was a bit more reluctancy from clients saying, you know, "But now things are going better, things are stabilizing. Why are you raising prices again?" We had the usual discussions. We, we explained them, the wages impact that it's natural, when you have, an inflation like this in the economy, in general, it's obvious that you need to raise, your salaries to retain your talents. At the end, I must say that it went, it went through, pretty well. We didn't have any major fight with any client. It went pretty well. The second point you raised is when are we going to reach 20% EBITDA margin? I wish I knew, and I had a date to give you. Obviously, we're working every year to improve our profitability. Last year we had a huge impact from the production inefficiencies. We had impact from inflation volatility and parts of inflation that we hadn't anticipated, like energy spike linked to the war. This year we will have an impact that has been consciously taken, and it was driven by the decision to take on board the Dolce&Gabbana business that will have a dilutive effect on our P&L and on our margins. We are still convinced that we took the right decision because we are still a small company. We still need to grow, and growing top line always comes with a high priority in our decision-making process. We expect some margins improvement this year. It's not gonna be what we would have ideally loved to show you because of this dilutive effect, but, you know, we should see some basis points of improvement this year. The last point is about CapEx. I don't know Okay. Return on invested capital. We come from return on invested capital that we had at the end of 2019 at close to be 16%. Obviously, we went down during the COVID period to 8%, and now we are on a trajectory of increasing the return on invested capital. Today, we are at 12%, and the target that we have is to go back to the old ratios that we had back in 2019. Okay, thank you very much for your answers. All the support from here. You're welcome. You're welcome. As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question is from Roberto Casoni of Otus Capital. Please go ahead. Hello. Hi, good evening all. Happy to have you. Hello. I have, it was a very interesting Q&A session. Most of my questions have been answered. I just have been left with one. I mean, you keep talking about price increases, and you keep reminding us the price increases is on the reorders. Now, given the fact that, if any, I know that you're trying to grow top line, but there is a clear trend among emerging brands as well as China reopening. I just want to understand how is your pricing, your level of competitiveness when discussing on a new project. I'm talking about the remaining 30% of your P&L that is actually is a new project, a new product. Given the fact that you're possibly not the largest worldwide, but you're becoming one, clearly a point of reference. There are not many that are able to execute globally in the way you do. I mean, how? Can we expect better conditions? Is there a time for you to impose better conditions when it comes to discuss new projects with customers, either new or old customers? How is the competition in this moment behaving from this point of view? Thank you. Ciao, Roberto. Thanks for your question. Pricing competitiveness, you're touching a sore point. We've never been competitive, to be very blunt. We are known in the market for better innovation, better quality, and higher prices. That's our positioning, and that's witnessed by, and or demonstrated by the fact that our percentage of prestige in our total sales is clearly a lot higher, almost double the market split. The ones, the clients that are really fiercely competing on price tend not to come to us. We tend not to go to them because we know there is a mismatch there. This said, if you look also in the mass market arena, brands are coming to us, not the cheapest mass market brands, because they know they get better products, all in all, in general. Now, it's clear that if someone wants a, you know, standard gloss, he will likely not come to us. There are competitors that are cheaper than us, that can provide you with a standard gloss at a cheaper price. You know, that's not our positioning. That's never been our positioning. It will never be our positioning. Is this cutting out a part of the market from us? Yes, it is, especially in China, where, as you know, most of the local brands are fiercely competing in the mass market arena on price, we tend not to be the right supplier for them. We target much more the prestige segment, the masstige segment, or the higher mass market price points, that's why you have Chinese brands that have done a very deliberate strategy, where they buy their standard portfolio from Chinese competitors that are a lot cheaper than us, they tend to buy from us some unique products that allow them to be advertising on a higher ground to project a better image for their brand. That's a reality. Have I seen more competition in pricing this year? No. I've seen it probably in Asia. I think that, you know, especially our big Korean competitors have been a bit more reluctant to raise prices than what we've done. If I've not mistaken, Cosmax just published ending the year with a 6% EBITDA margin, that, you know, tends to show the fact that they have been not particularly active on pricing. There could be other reasons behind the numbers, and I've not studied that well enough to give you an answer. All in all, pricing competition, we've always had, especially in China, but we also had it in the Western world. We're not worried by that. What we are really keen to do is to have a clear idea of what are the pricing points every brand can afford, so that we can propose to them formulas that are matching their cost of goods target. That's the key. If their cost of goods target is too low for us, we'll be very frank and transparent, and we'll tell them to them. Perfect. That's very clear. Thank you very much, Renato. Thank you, Roberto. For any further questions, please press star and one on your telephone. Gentlemen, there are no more questions registered at this time. Okay. Thank you very much, everybody. Thanks. Thanks. Speak to you soon, I guess. Thank you. Thanks a lot. Have a nice evening.