Good morning. Welcome to MÁDARA Cosmetics Investor Webinar. We will start with the presentation, after which we will be addressing your questions. You are kindly invited to submit them in writing through the Q&A window below the presentation, or raise your hand and be unmuted after the presentation is over. In case you would like to re-watch the session, the recording will be available shortly after the call. Now, let me introduce today's hosts. Gunta Šulte, member of the management board and the CEO, and Tatjana Nagle, member of the management board and the CFO. The floor is yours. Thank you very much, and good morning, everybody, on this rainy day. As usual, we are very happy to welcome you on the investors update on how MÁDARA Cosmetics has been proceeding in the first half of the year. Without further ado, I will now move on to some legal disclaimers. To today's agenda, as usual, you see myself, I am CEO of the company, Gunta Šulte, and also a member of the management board. Here with me, as usual, is Tatjana Nagle, who is chief financial officer of the company and also a member of the management board. Today, we are happy to share maybe in more details how the first half of the year has been for MÁDARA Cosmetics. So, going through key highlights, key numbers, and then also a sneak peek of what is to be expected in the second half of the year. As usual, you will have also a link to the full unaudited report of financial statements for the first half of the year in the active link in the presentation. Without further ado, I am happy to share that first half of the year has been really, I would call it, a trajectory changing and success for MÁDARA, and I am really, really proud of what the team, in combined effort, has achieved. I think this is a testament of all the previous years' commitment to doubling down on e-commerce. So we are happy to report double-digit growth both in our revenue or turnover, and then also growth in our efficiency, which has been a relentless work in the background. I have been already on previous webinars explained and told why company shifting to e-commerce first approach. By this, I do not mean only the e-commerce as MÁDARA Cosmetics store standalone. I mean by e-commerce, all the ecosystem that is surrounding it. So meaning MÁDARA Cosmetics store, meaning marketplaces, meaning third party or B2B pure players. We see this as a fastest evolving segments or channel in the industry, where the decision-making is taking place and where the shopping is taking place. So, I am very happy to announce that we really grew double digit in e-commerce, and that was the driving force for growth for MÁDARA in the first six months. We saw a really tremendous growth in one of our categories, which is haircare. To much extent, it was also driven by one single product that went viral, which is Micro-Keratin Silk Hair Mist, and you see it on the bottom right corner of the slide. This particular product grew multiple times, and this was not an accident. This was basically a relentless work of team finding the angles and products that we can really boost and grow online. This trend started in TikTok, but it really grew in the only positive way as, let's say, this positive virus that took over also the other ecosystem of e-commerce, meaning, we saw the first positive spillovers on our direct e-commerce store on marketplaces like Amazon, like TikTok. Then we also saw fantastic spillover for our physical retail, both for MÁDARA retail stores that we have here in Latvia, but also other physical players across the Europe. It is really the way to go. With that, I am also very pleased to inform that we are further continuing commitment of diversifying online channels. We started already last year of opening the first TikTok Shop in United Kingdom. This is a resource-heavy process and heavy channel, so I am not going to lie, it is not victory from day one. You really have to invest to unlock the channel. So we cannot make too many at the same time, given the also task that we want to be efficient in how we operate. So this is resource and finance heavy. With that, we have also taken commitment this year to enter another TikTok Shop in Germany. But what I am even more proud to present today is that because of MÁDARA Cosmetics team work with the TikTok Shop Europe, because it is different than TikTok U.K., we have really unlocked for the entire Latvian businesses to sell on TikTok European shops. It is not only Germany. There is TikTok Shop France, there is TikTok Shop Spain, et cetera, to sell their goods from Latvia. It was not possible before. You had to open your warehouse or ship goods from that particular country. Because of teams, discussions, and work with TikTok Europe team, this obstacle is now removed and, ourselves, we are starting operations literally now in September. But I think it is again, a very positive spillover that we are able to contribute to wider e-commerce community in the region. Another highlight has been really in successful innovations, and here we doubled down on stick format. We launched a stick format of our best-selling product, CC cream. That product is called CC GO. Also having SPF 30, six shades, and we launched it in April, and it has been by far the best-selling innovation of year to date. Then also another innovative format in stick format, yeah, packaging. It is a Dewy Stick, which is a caffeine-infused gel-based serum in the stick format. Again, having a very positive take-off in our B2B and also e-commerce channels. Last but not least, even despite I am saying e-commerce first, B2B is and will be a very important pillar for MÁDARA, and I think it is also making brand alive in physical retail. Not only physical, because by B2B we also mean online B2B partners, which is not only almost half contributing to our turnover, but also a major or big part profit contributor as well. So I am very happy to share that we also grew in most of our markets. Particularly, I am very happy to share that Finland is finally back to growth. We changed beginning of the year operating model in this particular market, which is one of, let us say, most saturated markets for MÁDARA. The other one is Latvia. In these high-saturation markets, to be honest, it is very difficult to change the trajectory because it is quite saturated already in terms of our presence. However, despite the fact that we have been declining for multiple years in the market, we took, or MÁDARA Cosmetics team took over e-commerce of that market, of Finnish market. Transmeri is continuing to operate in physical retail, and we see finally brand being back to growth. We see multiple times increase in new user acquisition, which again will bring positive spillover to physical retail. With that, jumping also on the next sub-point on B2B footprint is that also Transmeri has had major success of adding another major retail chain to MÁDARA's B2B client list. K-Citymarket, but not only that, we had two major wins in France. We started cooperation with It is almost a monopoly, but monopoly may be not the right word. It is a major player in professional haircare or specializing in haircare products. The chain is called Bleu Libellule, but with a really extensive physical retail of more than 400 physical outlets in France. We started with them as one of the few skincare brands that they are introduced within their retail channels. Another partner I am very proud of is starting cooperation with Monoprix, which is upper premium retail chain. We started first half of the year with 30 stores and literally now are adding another 30 stores with MÁDARA makeup products. Last but not least, because the list is actually longer, here are just a few biggest names. We also started an extended cooperation with BENU Pharmacies, in this particular case in Netherlands, because we already have successful partnership in Latvia. With that, I am giving floor now to Tatjana to tell more about numbers. [Non-English content]. Hello, dear shareholders. Key numbers from my side, and I am really happy to share such numbers with you. If we look at the revenue, then we achieved growth of more than 17%, which is EUR 13.36 million. As you remember, the guidance for the year was +10% in revenue. I am super happy that in the first half of the year, we managed to over exceed. If we look at the profitability numbers, then there is also a major improvement. If we look at the EBITDA, then it almost doubled compared to the same period last year. It was EUR 1.51 million. Also, if we look at the pre-tax profit, then here is also a growth of roughly 300%. Also here is a major improvement in comparison to the first half of the last year. The EBITDA margin is also improving. Last year in the first half, it was 7%. Year was about 10%. What we see in the first half of this year, then it is 11%. Here I have to stress that it wasn't just luck. It was really disciplined work to achieve these improvements. Of course, one part is revenue growth, another part is cost discipline. If you look at the P&L statement, what you can see is administration costs have decreased. If you look at sales costs, then the growth of sales cost is much lower than the revenue growth. Yes, overall, a number of transformations were done within the company to improve efficiency. If we look at the markets and maybe a bit more about the revenue stream, then overall, the proportions between these big segments, sales in Latvia, sales in the European Union, and outside the European Union, have not changed dramatically. So Latvian market still is the largest market, although we have candidates to become number one markets as well outside Latvia. Here one revenue stream and profit stream is MÁDARA brand. MÁDARA grew by 13% combined, and then contract manufacturing segment grew by 50%. Here we have Selfnamed Mossa as the main drivers for growth. If we focus more on MÁDARA brand, which is and will remain the core of the business, then here what we see is that, in Latvia, which is the biggest market, revenue remained stable. Here we have to admit and understand that in Latvia, we are quite a mature brand, so it's very hard to report big increases. Rather, for Latvia, it's important to remain stable and not to drop. Here I'm happy that we remain stable and that there are no big negative changes. If we look at the markets outside Latvia, then what we saw is that our top markets reported in total +20% growth and these markets account for 45% of our brand turnover. The markets are Germany, France, Czech Republic, Spain, Finland. Here Gunta already mentioned that we had very nice results in Finland also. The operating model has changed, with the MÁDARA team taking over direct e-commerce. We are happy to report that we had +20% growth in Finland. Also there are some outperforming markets, so it is Czech Republic and Slovakia together, as they are operated by one distributor. Also, we are continuing a growth pattern in Spain. Spain grew by 51%. Also in France, we are doing 21% growth. In Germany, growth for this half of the year was weaker, where mainly e-commerce struggled to achieve high growth. So, the growth is much milder. Also if we look at global arena, here we are happy to continue our expansion in Saudi Arabia. Also we made market entry in Singapore market. If we look more closer at the channels, and here maybe more about e-commerce, then what we see is that our direct e-commerce share is increasing. There is 2 percentage point increase in compared to the same period last year. Now e-commerce share is 40% of the revenue, and the revenue growth of this segment was 24%. Here, one channel is our own online store, which grew by 16%. Then another sales channel internally, we call them marketplaces. Basically what we have here, Amazon, TikTok Shop, Zalando. All of these combined, reported +100% growth in turnover. Again, coming back to Gunta's point, what we see is that we can achieve much faster growth in e-commerce, and it is very important to continue to develop these segments. If we look at our own online store and how we did there is of course more metrics, compared to other channels. Basically there are some markets which are continuing to outperform. I am super happy to see that we continue growth trend in Spain. Also what is important to note and where we see a bigger shift is in our online market, the proportion of new customers and repeated customers. There is 7 percentage point increase of new customers. Again, referring back to Gunta's point on e-com strategy and working on new client acquisition and finding new angles and unlocking the correct ways to approach new customers, where this season, it happened to be our Micro-Keratin Silk Hair Mist. It really helped to achieve increase in new customer growth. Super happy for that. Yes, we can go to products. Yes. Thank you. I will take over from here, more explaining in detail what happened with our product categories. Overall, alongside with the innovations I already mentioned, we launched in total 10 new products in MÁDARA portfolio in the first half of the year, which contributed to more than half a million in turnover. Jumping on the picture to the right, I think we have had some really more visible shifts in product category split than if compared to previous reports. We really see two categories accelerating, and this is also visible in how they are, let us say, taking bigger share within our portfolio, which I am very pleased about because the more we diversify in terms of internal portfolio performance, the better it is for the company. We see really substantial growth in share for haircare products by 6 percentage points. Again, this is going back to the starting from one product which gave positive spillover for the entire haircare category. Another category which continued acceleration was makeup, and this is a lot thanks to CC GO launch in stick format. Respectively, because the pie is 100%, then other categories which grew less, then obviously their share decreased, which is logical. What I want to emphasize is that we see really market trend and also a growing demand in stick format products, both skincare, makeup, sun care, and this is why company has made a prepayment and is bringing in-house our own stick or more advanced stick filling machine. We already have one, but it is rather, let us say, specific and limited in terms of output. We are upgrading ourselves and bringing more higher pace and higher versatility filling machine from Germany, which is arriving second half of the year, and the team is really excited that we can really then increase the playground in stick formats. Like I mentioned, it is not only, let us say, the visible products that were showed, but really the opportunities are much wider, and we can also increase the production output for our mascaras, concealers with this filling machine. What I am also very honored to see and humbled to see is really a global level, unpaid, unasked recognition from really a global stage. We have had these mentions already in the past, and I was also very honored to see our team's efforts recognized by one of highest-paid supermodels in the world. She was mentioning MÁDARA Skin Equal Soft Glow Foundation, and we were presented in multiple Vogue channels, Vogue France channels, which is one of the most prominent Vogues in the globe. Again, this came as a very positive surprise for the team because it was not aimed or it was not targeted. It came entirely organic and really, I think, reemphasized that product comes first, product quality comes first, and product functionality comes first. Then as a, let us say, positive additional point that we bring is that we are clean and certified, but really that the product performance has to be there ultimately, and this is what I think we see both in positive numbers in the growth of revenue and new customer acquisition. We also see this in more, let us say, soft organic mentions that we get from world-class mentions. Then maybe just to show what were other innovations we, or renovations that we did in the first half of the year. Another major trend in skincare is exosomes. We launched Exosome Longevity Radiance Peptide Serum. A massive project for the team was actually rebrand for one of the first products that brand had launched, which is Deep Moisture line. Deep Moisture line got even better formula, more relevant formula for nowadays consumer, better packaging, more recyclable packaging. The entire line was relaunched. Already mentioned innovations in stick format, so six shades of CC GO, and then also Dewy Stick. The last two were definitely the stars of this first half of the year. Then just a quick sneak peek of what is to be expected for the upcoming second half of the year then. We are not changing the course, so it is further acceleration of our e-commerce channels, and I emphasize in multiple forum that it is really like I mentioned, it is both working on new user acquisition for our direct e-commerce shop, but it is also diversifying marketplaces. We are starting operations in Germany in TikTok Shop literally now in September. With that, we are also starting different platforms for affiliate marketing that should and will bring new user acquisition for our direct e-commerce. Then we are further bringing in new products. For the second half of the year, the focus will be on lip care, eyelash treatment, and another core line relaunch, which will be SOS skincare line. What is happening in the background or behind the curtains that maybe is not visible to the outside world, but which is fundamentally important that we maintain or even further improve our operational efficiency is process automations. This is happening on multiple frontiers. Mainly e-commerce planning and manufacturing is covered this year. So, really working on full scale automation in terms of how the process and data flows and also bringing AI layers where relevant. With that, we are maintaining our commitment of growing at least 10% for this year, equaling to at least EUR 25.5 million and delivering efficient growth and sustainably efficient growth. So, maintaining double-digit EBITDA margin, which we believe is a good prerequisite for further future growth. With that, thank you very much. This is the end of the presentation. Thank you so much. We will now be continuing with the questions and answer session. Participants, please submit your questions either in writing through the Q&A window that you see below, or alternatively, please raise your hand and you will be unmuted. We will start with the first question that we have received. Yep. I can take it. Where do you see MÁDARA Cosmetics in three to five years? Thank you. Here I have to be very careful not to give any external commitments and numbers. I think definitely this course that we have started of, first of all, becoming a dominant e-com player, and I think this is very important for brand as such because this is where consumers are leaning towards. It is further growing and doubling down on e-commerce channels. Is it our own or is it third party will be very important, and it is also very important that we continue finding markets that deliver growth, like Tatjana mentioned outside these saturated markets. I really expect that in a couple of years' times, we already reach saturation in some other key European markets and then discover new ones. Having said that, I think ultimately for us, it is important that we deliver excellent product, and this is where team will continue to invest in the back office. It is really product excellence that we deliver functionally amazing formulations and products. On top, we do it in a cleaner and more sustainable way. So e-commerce growth, further geographical diversification, and excellent product. Thank you. Are you considering manufacturing or outsourcing outside of Latvia as well? I can take that as well. We already historically had some marginal cases where we had tried it with contract manufacturing. One was for, Tatjana, correct me if I am wrong, but I think it was for eye patches. So the mask format that you put under your eyes. Now we are actually co-manufacturing with Faber-Castell, our eyebrow and eye pencils. This is the only product that is manufactured with third party. Having said that, going through these discussions and experiences with third party manufacturers, we really, at this point, don't see much of added value, speed, or cost benefit to go outside. We really believe our R&D capabilities are really world-class in what we do. I can't be that arrogant to say never in the future, but I don't see it as a strategic shift in the nearest years. Okay. Thank you. At the moment, no questions have come in. We will pause for a minute to give everyone an opportunity to submit any final ones. One more. Are there any lessons you can take from PrimePrometics? Plenty. To be honest, I am really, really proud that Latvia has had such a success case in the cosmetics industry. Because to be honest, it is not easy to achieve. What and how we are treating when discussing about PrimePrometics and team, it is really exception that we all look up to. We really have to understand it is a completely different business operating model. It is almost mono market. It is purely e-commerce. It is fully outsourced manufacturing, and it is really unfair to compare apples to apples. However, what we can take, and I think it is a fantastic lesson from PrimePrometics, is really how they do and treat their content and how they can scale their content. I think this is one of the learning lessons that they have mastered. It is beyond any other player here in Latvia, how to really scale in content and user acquisition. Thank you. All questions have been addressed. That concludes our Q&A session and also the webinar in general. Participants, thank you for being with us today. Thank you.