Good afternoon, this is the Chorus Call conference operator. Welcome, and thank you for joining the OVS first half 2022 financial 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. Stefano Beraldo, Chief Executive Officer of OVS. Please go ahead, sir. Good afternoon to everybody, and thanks for being here with us. I try to be short. Maybe I start by making a couple of comments about the general mood that characterize the first half. Also was supposed to be a difficult half for us in a very challenging market with a high inflation impacting salaries and consumer spending. All the negative aspect regarding gasoline cost, energy bill, war, a little bit of pandemic were already in place in the first half, and we expected to face a challenging environment. It has been a six months at first half, healthier than we expected. Thanks, partially to great weather condition in the month of May, but also thanks to what we believe is becoming a kind of consistent attitude of our customer to privilege OVS, even because OVS is a bit repositioning its image in a better profile, being able to attract the customer coming from a higher price point. Probably thanks to the general difficulties in terms of purchasing power of our customer base and of Italians in general. Having been able to reposition the brand with new stores, with the change of store image, a new logo, Piombo collections, is attracting the new customer. This is visible from our CRM data, and this is also visible once we classify our pricing points. We are witnessing an increased mix in the turnover of higher prices, thanks to the fact that the new collection of Piombo, the new brand that we are introducing, are more and more preferred by new customers. So thanks to this, we have been able to more than compensate the heavy headwinds that we had in terms of cost, generating a very solid margin. We sold so much in season. This is the period where we had the highest sell-through ever and the highest percentage of full price sales compared to the total sales. We have been forced to minimize the discounts in the period of July and August, also because we were getting out of stock in many categories. As a result, I think that we had a great profitability increase and a great momentum in our relation with the customers. Maybe one aspect that I want to point out. For the first time in I believe 17 years that I'm in this company, I'm managing this company, the kid segment is moving slower than man and woman. The adult in the first six months has been able to generate a positive like for like double digit, either in women and men. Within this, the highest prices, the items with a higher price, generated a +35% increase. The lower performance of kids is mostly explained by huge delay in deliveries, which impacted the first three months of the year in terms of deliveries and which expired basically in May. We suffered, I believe, at least 4% or 5% loss of sales in kids because of this. A couple of comments on how we see the future. Clearly, we are aware that we are in a very gloomy situation with all the external factors still against our industry. Energy cost increase, raw material cost increase, logistic cost increase. At the end of the day, we have been able to partially mitigate, and we will show you during the discussion a little bit more in detail along the lines of these improvements. Thanks to that and thanks to the fact that we believe that we will continue to benefit from the general downtrending, that the increased inflationary pressure will activate the consumer habits. I believe that we will continue to be able to post a good result in the second half, not in the same extent that we had in the first half. We believe that the advantage versus last year that we have been able to achieve in the first half is so huge, that it will be very unlikely that we will lose entirely this advantage. We are convinced that we will be able to deliver also a decent second part of the year in a very challenging environment. I hand over to Francesco Leoncini to walk you through the main aspect of our presentation. Yeah. Thank you, Stefano. I just conclude page number 2 of the highlights with the point on sustainability, because we are very proud that for the second year in a row OVS was awarded the premium as best as most transparent company in the fashion industry, over 250 brands that were part of the survey. For us, it's really a matter of pride of all the things that we do day by day in order to have the most sustainable supply chain possible. I move to page number 3 where we start entering into the details of the second quarter. This is a quarter that we can compare also versus last year without having to make special correction for the lockdowns. In fact, last year there were just three weekends in the month of May of closure in the shopping malls, but for the rest was the first quarter free of restrictions. In this, let me say, comparable situation, our sales were 10% up, as said by Stefano, thanks to the good weather in the month of May, but also, and maybe even more to the acceptance of the new collection on the adult segment. This led to EUR 18 million increase in the quarter in terms of gross margin. That was partially eroded in terms of additional costs for about EUR 10 million. Energy is hitting us in the quarter. The impact was EUR 4 million. We had some inflation on the rest, but as you can see, the number is not exploding, also because the declining quantity have in itself a possibility to reduce the cost, for what is related to that element. For instance, the man-hours needed in order to put the goods, the merchandising to the stores, the number of trucks that we have to use to bring the goods to the store. In that light, OVS really managed to reduce as much as possible the quantities needs, and to limit the impact of the inflationary effect that was on energy in a direct way, but also on the other elements. In the quarter, the EBITDA is growing by almost EUR 8 million. Then we can see that this increase is even higher at level of profit before tax, because thanks to the improvement in the financial structure, the financial cost is much lower than the previous year. Overall, the profit before tax is growing EUR 11 million plus 33% versus previous year. If we move on page number 4, we have the full view of the semester that, as told by Stefano, we see an increase in EBITDA of over EUR 20 million, and overall a positive impact also in terms of net income from EUR 13 million last year to EUR 32 million this year. Of course, if you have any additional question on the numbers of the total semester, we will have at the end a possibility to intervene. One element that I think is good to mention is the gross margin, because we managed to keep the gross margin above 58% and in line with last year when we grew by almost 90 basis points versus 2019. Thanks to a careful management of markdown that now is becoming really a common practice for the company, we are achieving an additional improvement in terms of profitability. Page number 5 provides a breakdown by channel, and here we can see that all the channels are growing, both in terms of sales and in terms of EBITDA. In particular, I would mention franchising is growing by more than 30%, and this is also our preferred way to grow at the moment because we managed to grow without a deep capital requirement in terms of CapEx for opening the new stores. In terms of a view by brand, we saw Upim. All brands are growing. OVS mostly thanks to the performance like for like in the stores. Upim also thanks to the boost that they have by the new openings and the franchising in the franchising channel. In terms of EBITDA, we see a +31% on OVS and a +67% on the Upim side. I move to page 6 and start to comment a little bit about the working capital. The first element are the trade receivables that are growing significantly, but this +24% that we are experiencing, as said, is strongly linked to the performance of the growth of the business. Actually, the DSO are reducing. We are, let me say, just experiencing a profitable growth of this channel. Some words more on inventory, because in the past, OVS suffered of growing inventories, because of its difficulties in achieving very high sell-through during the season. This is not at all the case for this number. Because breaking down, let me say by three major blocks, the future season, the incoming season, the end of the spring-summer and the old stock, we see that the incoming season is growing by more than EUR 100 million, and the others are strongly reducing. In order to avoid the delays that we experienced in the first quarter, in the first half of the year, we decided to anticipate the purchase of the full winter season. We have more stock today than normal, but it's just an anticipation of one month to one month and a half with respect to the ordinary business. This is just brand-new stock that put us in a very safe condition in terms of not missing, not having delays in deliveries in the next six months. By the way, this growth in inventory being related to fresh goods is also matched one to one in terms of trade payables that are growing even more, EUR 150 million. Half of it basically related to the growth in inventory and the rest related to the progressive normalization of the business. All in all, the working capital is declining, so it's freeing up cash versus one year ago for EUR 53 million. In terms of investments, page 7, we see a total which is in line with last year, with a little bit change in terms of mix, with more focus to the existing network, on which we are investing EUR 3 million more. This is also something that we see is really appreciated by clients because all the structured stores, renovated stores are performing 6-7 points better than the rest, the comparable part of the network. In terms of new openings, maybe it's worthwhile to highlight the flagship in Napoli Scarlatti, which is going to be, let me say, the best store in Southern Italy, but is also, let me say, the best expression of OVS as a platform with external brands being present, with also the first physical experiment of ClioMakeUp, which is a top performing perfumery at the moment with more than EUR 3 million, 3 million followers. The result of the store is even better than expected, highlighting that the interest in physical store in beautiful physical stores by the client is really still present. In terms of brand acquisition, I think that most of you had the news that at the end of the summer, we purchased the brand Les Copains. It will be accounted in the month of September, so it's not yet in that figures. I move to page number 8 for a summary of cash flow. This is the cash flow of the first semester, and we are comparing with 2021 that was benefiting of the extraordinary condition of the stocking and also in terms of, let me say, other liabilities. There were some advantage in terms of VAT that make the comparison with 2021 so not meaningful. Nonetheless, in these six months, we generated a positive EBITDA, positive operating cash flow of EUR 3.4 million. That compares to a minus 20 million, minus 19.6 million in 2029. We are 24 million better also in terms of cash generation. This also allowed us to use a part of the cash in order to distribute dividends, 111 million distributed in the month of June, and also starting the buyback for 12 million. This buyback is also continuing, and maybe we can comment at the end that the board of directors also decided to continue investing in our shares, given the current evaluation and the strong overall financial performance. On page 9, we have a summary of what once was the worst page maybe of this document, no? A couple of years ago, we had a leverage ratio at the end of the COVID of 5. Maybe some of you will remember. Now we are commenting a leverage ratio of 1.35, 1.36. A very safe condition, despite the fact that, as said, the net financial debt already includes EUR 23 million investment for dividends and buyback. A situation that allow us, as also we saw in the previous slide, to reduce the cash out for interest, and so focusing more on the core business. I conclude on page number 10 with the outlook for the second half. As said by Stefano, the external environment is really challenging, but also as it was in the first semester. We proved to have a correct brand positioning able to attract new customers from the bridge segments above us. The initial start, the good start of this fall season, especially in the last few days, when finally we had also an autumnal weather outside, are confirming our capability to perform well also in the second semester. In addition, on the cost side, OVS was more proactive than reactive, let me say, in terms of hedging on the euro/dollar exchange rate, in terms of hedging on the sea shipment, which was maybe the first spike in terms of inflation already one year ago. At that moment, we decided to sign a three years contract for 50% of our needs, and we managed to obtain tariffs that are above 50% lower of what is the current spot rate. And also, as usual, let me say, booked 50% of the energy that we need for the stores at the price at the beginning of the year. Also on that side, we are managing to absorb a big portion of the inertial cost increase that are affecting the retail sector in this moment. In consideration of that, I guess this is the sense, more or less, of the document. Our view, the management view for the full year is a significant improvement versus 2021. With that, I leave the word to Stefano to questions, if any. No, thank you, Francesco. I think that now we open the discussion, so we are ready for your question. Thank you. This is the Chorus Call 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 touch tone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Francesco Brilli with Intermonte. Please go ahead. Good evening. Thanks for taking my question, and congratulations for your results for the first semester. I've three questions from my side. The first one is if you can provide us with some additional color or indication on the components of the growth of the semester in terms of pricing and volumes, perhaps. In particular on the mix, I was wondering if the excellent profitability that you saw in the first semester is also linked to a strong performance of Piombo or more in general in the higher lines versus other brands in your portfolio. The second one is on back on the inventories, which grew for the anticipation of new collections. Maybe you can provide us with some color on the purchase condition of these new in collections, if you have seen a significant increase in cost of goods, and a color on this. I have a more general last question. You commented on consumer trends and very robust acquisition of new customer, also pushed by the down trading of consumer. I wanted to know if you continue to see these acquisition trends in the last weeks, and if you have evidence perhaps from your CRM on the fact that this new customer is in a certain sense acquired and not occasional buyers for you. Probably if you have specific action to enhance retention of consumer retention. Thank you. Okay, thank you. As far as concerned, the first question, I think I said that we had more or less the expected result from the equation volume and prices. Now, we maybe made a small mistake in assuming that in kids we might have less sensitivity, but at the end of the story, the sensitivity is more or less the same. The result is that we had more or less a 5% decrease in volumes in the period of the year, which is comparable with last year. If we consider also the first part of 2021, when we had some store closures, the comparison became meaningless. If we compare what happened in the last four months of the quarter, where the result has been fully comparable. We experienced more or less -5% volume, +7% value. This By 7% prices? Yeah, price, sorry. By 7% prices. The total being approximately +2%. This has been generated in terms of mix, as I said, broadly in favor of adults, where we experienced a better result with lower quantity decrease and higher price increase. We have been able to keep the prices of kids a bit mitigated compared to the price increase in adults, because we believe that adults can decide to pay even more because we are offering them a higher quality. While mothers, when they buy for kids, they want to have a consistent and affordable quality and price. Decisions are more influenced by price and quality than in adults, where decision is influenced more by quality and then price. As a result of it, we had this lower decrease of volume compared to the higher increase in prices. I insist, I believe that this has been possible mostly because we introduced new stores in the store. For instance, this was the first period where we introduced Piombo women, and this brings me to the second part of your question. Piombo women is clearly perceived as a higher quality component of our collection compared to the average. The average price is a bit higher, like 15, 20% higher compared to the average of the women. The success of Piombo women that coupled the success of Piombo men demonstrates that we have new customer or old customer attracted by better quality items. In terms of impact of purchasing conditions, we are experiencing in the second half more or less the same cost increase that we experienced in the first half. There is a small increase compared to the first half. In this moment, we are witnessing a more stable or even declining trend in some raw material. Not enough to make an estimation on what will happen in the full cost of goods for next year, but we have initial evidence that apparently the incredible hike in the cost of cotton and all the other material we are using is taking a different direction hopefully. In terms of consumer trend, yes, we have evidence that we have new customers. As I said, from the CRM data, it's clear that we are attracting new customer in the price ranges, which are the highest one. We have also evidence from our CRM data that these are occasional customers. I think that what is happening in the market is a general trading down process. As I said, we are benefiting from it, mostly in the adult. In the kids, we believe that for the first time, we suffered in the first half because we might have had a much higher turnover if we shouldn't have experienced in the first part of the year, about EUR 40 million delay in deliveries that has been filled in terms of gap compared to the requirements only in the month of May, as I said. I think that to conclude this part of discussion about the component result, very good, for the first time, very good, excellent performance of women and men compared to kids. The less exciting performance of kids is mostly generated by late delivery, so nothing dangerous, apparently. For now, that's it. I hope that I've been useful to you. Thank you. The next question is from Andrea Bonfà with Banca Akros. Please go ahead. Hello, good afternoon to everybody. My first question is related to the potential acquisition of Coin. If you can just comment on what are the rationale behind, because I mean, for us, as all analysts, our memories are of asset which has never been able to really perform. So if you can give us your view or your vision on this potential asset. The second one is related to your comments on how the Q3 is performing and your general expectation for H2. You said qualitatively decent H2, but is there the case you are still expecting a decline in H2 EBITDA year-on-year? Do you also aim to perform in line or even above in light of your, let's say tailwind of the first half. The third question is on working capital. It's quite clear your comments on the presentation that you're being helped by the payables, but it seems that a lot of the improvement is coming from that item. If you can further comment on that, what will be the final structure at the end of the year for the three items, stocks, debt versus client and payables? Thank you very much. Okay, I'll try to be as fast as possible because the question should require maybe a longer answer, but I try to be very, very fast. The rationale for Coin today is that OVS today is a company totally different compared to eight years ago. OVS has basically vertically integrated the department store. It seems a paradox, but Upim is a department store with a lot of private label and with some international brand like Esprit or like Jack & Jones or Springfield inside Upim. Has perfumery, Upim has home decoration. OVS group today is not what it was eight or nine years ago once we carved out Coin. At that point in time, there were no synergy and no reason to keep the two entities together. Today, we have a business opportunity, which I described shortly now, and also Coin has great locations that might be in some case converted into Upim. In some case could host our collection like Stefanel, which today is present very successfully in about 10 Coin, something like that, I don't remember. The same Black Open might be introduced in Coin or Gamma, which could perfectly fit with Coin customer base. The rationale is that. Regarding the status of our possible acquisition, we are still standing. We are running our due diligence process. We are not happy. We want also to see how Coin will terminate the full year. We are close to year-end, and so we take our time. There is no hurry. The second question regarding the second half of the year. We don't think that we will continue to perform at the same pace that we generated in the first half. I assume that we will lose something compared to last year if we want to be prudent. We are ready to do even more than last year. It means that in term of merchandising, we are ready for a good result also in term of like for like. Let's suppose a 0% like for like, that would be incredibly favorable given the external condition. We are ready with our cost base, with our labor cost, with our all the variables of the business also to tackle a -2% or -3%. That's why we are obviously more prudent in the second half compared to what we have done in the first half. We believe that some of the external conditions will be even worse compared to the first, and we would be very happy to confirm the second half of last year, but we are ready to do it. It will depend very much on the consumer demand, difficult to predict. In terms of working capital, I prefer Francesco answer to this question. Please, Francesco. Yes, thank you. In terms of receivables, I would say they will follow the business as they did in the first quarter, in the first half. We expect, let me say, this growth to be confirmed also in the second semester because the business is growing, and so we expect something like that going forward. I think that the core of the question, in fact, was on inventory and payables. If we split the portion of payables related to the inventory, we expect a sort of a match. We have not yet decided, let me say, the planning of shipments for the spring/summer 2023, but should we decide to anticipate also that side of shipments, we will see a parallel growth in terms of payables. If we decide to come back progressively to, let me say, the ordinary timing, we will see a decrease pari passu with the inventory side. While the quota of normalization on the rest of the payables, the ones related to all the services that we have in our stores, this should be already, let me say, at an ordinary level, and we expect to keep it also the second part of the year. Okay, thank you very much. The next question is from Luca Ostini, with 1AM West Please go ahead. Good afternoon, everyone. Just a couple of questions. The first one, you already mentioned the success of Piombo on the women. Can you tell us what is the penetration of the Piombo collection inside the women, how it is on men, and how further it can go considering that is a success? You're just at the early stage, especially on women. Then I have a follow-up question. We are silent because we have not a precise position, but between 10% and 15%. Francesco is showing me some result, no? Yes. Maybe more on the men that is discussed before because just to remember for winter is going to be the third season with Piombo men. We see a constant growth year-over-year vis-a-vis that more customers see the product, love the product. More or less, we are in the range of 15% on the men and 10% on women, taking only let me say, of course, the external part of the assortment. We are discussing in these days with the team to enlarge the size dedicated to Piombo Women for sure, given the great success of the acceptance of Piombo Women. You can expect that another 5 or 6% of increase in the women will be achieved also from the next seasons. We will launch Piombo Kids in the first half of 2023, and we are aiming to increase globally the presence of Piombo brand in the next coming season and years. Depending on the results that we will continue to generate. In principle, Piombo might achieve 20-25% of the space and maybe even 30% of the sales. This will be gradual. We don't want to lose the connection with the customer, which is looking for a less aspirational style, because Piombo is aspirational, and we want to continue to be consistent in offering also to more traditional customers something that will be in line with their needs. Okay, thank you very much, and congratulations for the success of Piombo. My follow-up question is, are you still working to get more brands under your umbrella in OVS? We are open to new brands. In this moment, we launched very successfully the line of backpack called JanSport. It's the most important accessory of West Group, is the most distributed backpack in the U.S. market among students and not only. They decided to ask us to be the privileged partner to introduce this product in the Italian market, and we are happy to do it. We have just recently acquired Les Copains, and we will develop a collection that differently from Stefanel will be entirely devoted to our stores, for sure to the best Upim. We are wondering if we might introduce Les Copains also in some OVS. We are discussing this in this period. We are still open, and there will be new brand for sure. In this moment, we are happy to announce that we introduced the second physical corner ever opened by ClioMakeUp in Parma. It has been a tremendous success in terms of sales and new customers visiting OVS. The 30th of May, we will open the third corner of ClioMakeUp in Messina. There will be continuously new additions to our brands, even if the DNA of the turnover, the most important part of the turnover, will always be generated by our own brands. Well, never say always, but in the medium term at least, it will be generated by our own brands, either well-known like Piombo or Les Copains, so real brands, or private label like Baby Angel or Grand & Hills. Okay, thank you very much. Just a follow-up question on Coin. Is there a timetable for closing the deal or an expected timetable? We have a timetable. There is an exclusivity that will expire, if I'm not wrong, in November. I'm not sure. That's it. Okay. Thank you. Thank you very much, and well done. Thank you. The next question is from Domenico Ghilotti with Equita. Please go ahead. Good afternoon. My first question is on the comparison of your performance with the market. You know better than me on how your performance has been different from the market situation. What have you seen in terms of competitive arena in the last so in this month? Second question is on the cost inflation. Is it correct that for the energy cost, we should expect an even stronger impact going into the second half because you are hedged only at 50%, and then. On the logistic cost, it's not clear to me if, let's say, the mitigants are preventing the additional cost increase in the second half versus first half in 2023 compared to 2022. Last question is a clarification on your comments. Basically, if I understand properly, you are planning for like for like that could be even flattish, but you are feeling confident to have some improvement in EBITDA even if you get something negative like for like in the second half. Because you had a gap in the first half that you do not expect to fully offset even in, say, the weaker scenario. I answer to the first and to the third question, and I leave Francesco to the second. In terms of market, to be honest, according to our last figures, we have not increased our market share that much in this first part of the year. The reason is twofold. The market didn't perform very badly in general, contrary to what it did last year. We increased dramatically market share last year, and it was not obvious that we should have been able to maintain this market share because some player has been able to readjust mistakes or late deliveries, or store closures, or other problems. We were ready to see that in 2022, our market share should have been stabilized and maybe hopefully ready to increase next year. What happened was different from what we expected. We increased again our market share in adult. This is the key factor situation. We didn't increase our market share in kids. The positive color about this is that, as I said a couple of times, in kids, it is our problem, late deliveries, and probably late deliveries even compared to competitors. We suffered more than expected, and that's why we suffered in the first three months of the year. While in adult, we increased market share, thanks to all the decisions that we made, Piombo, Stefanel and those other brand that successfully has been included. The third question, I mean, my expectation about the second half, I'm not expecting as to increase again EBITDA compared to last year, as we did in the first half. I think that if like for like would be negative by 2% or 3%, what might happen is that, depending on the markdown strategy, we might end up with an EBITDA that is gonna be similar or even lower compared to the one that we generated last year. Not that much to sacrifice the bigger part of the advantage that we have created in the first half. I'm not able to say more on perfumery. On the cost, I may be providing some more colors on what already answered by Stefano. It is true, no? The headwind and the cost increase that we are going to have in the second semester could be higher. I have to say the conditional, because first of all, as you can see, the energy prices are so variable day after day that it could even be that towards the end of the year, there could be some maybe improvement, you know. Also the sharp decline of the prices September versus August was material. We expect, that's also one of the elements of our conservative view on the second semester. We expect some worsening in the growth of the costs, both on logistics and on energy. These are, let me say, single-digit elements that should not jeopardize, should not put at risk the whole bulk of the EUR 22 million advantage that we have so far. I hope this can answer the question, but maybe we should have this question in 3 months from now on, the 9 months results, where hopefully we are going to have a much better view on what is taking place on these external factors. Okay. Maybe just a follow-up. I was missing another point that is quite crucial. You are saying that you are seeing consumers in the first weeks or even days of the full winter season, say, behaving quite, say, quite similar to the first part. I wanted to check, say, you didn't see any deterioration really in the attitude of consumers, in the traffic, and the spending. It's really early days, but I wanted to check this. Honestly, what happened is that in the month of August, we were really out of stock. We had maybe 2-3% less compared to 2021, but not because of the customer desire to buy, but because of us. We sold so many items the last part of the full price season. I mean, May and June that we end up with no stock in several categories. We suffered at least 3-4%. If I have to evaluate which has been the consumer attitude in August, and I compare, for instance, the two brands. In Upim, we did extremely well because we had more merchandising compared to OVS, where we had very little things to be sold, to be honest. In terms of margin, this generated a very solid margin of OVS in August because we reduced the markdown compared to last year. In September, we started weakly very weak in the first 10 days because the weather was extremely warm. In the last six days, starting from last Saturday, when weather changed and became normal, things changed totally. Every day we are better than budget now. Really we have less traffic as always, more conversion rate as always, higher average ticket as always in the last I mean, as always in the last 24 months. It's a general trend. Even the e-commerce sales are recovering today with the new collections. In general, we believe that there is a kind of bigger attention to customers to physical store than in the recent past. I think decent news for us. Yes. Okay. Thank you. If now, time is elapsing probably, and if no more question is coming, we are happy to thank everyone attending this conference and looking forward to seeing you and to speaking with you soon, to the next quarter. Thank you. Thank you, everyone, and goodbye. Arrivederci. Thank you. Thank you, ladies and gentlemen. Thank you for joining the conference. It's now over, and you may disconnect your telephones.