Good morning, ladies and gentlemen. My name is Lori, and I'll be your conference operator today. At this time, I would like to welcome everyone to Coty's second quarter fiscal 2021 results conference call. As a reminder, this conference call is being recorded today, February ninth, 2021. On today's call are Sue Nabi, Chief Executive Officer, and Laurent Mercier, Chief Financial Officer. I would like to remind you that many of the comments today may contain forward-looking statements. Please refer to Coty's earnings release and the reports filed with the SEC, where the company lists factors that could cause actual results to differ materially from these forward-looking statements. In addition, except where noted, the discussion of Coty's financial results and Coty's expectations reflect certain adjustments as specified in the non-GAAP financial measures section of the company's release. I will now turn the call over to Ms. Nabi. Ladies and gentlemen, having completed another quarter, I'm very pleased to share with you the substantial progress Coty has continued to make strategically, financially, and on its organization. This amplifies the improvements Coty made in the first quarter and confirms that Coty is emerging from the COVID-19 crisis much stronger, more nimble, and well-positioned to capitalize on the eventual market recovery. Our Q2 profit and net debt came in well ahead of expectations. Our adjusted operating income and EBITDA grew high single digits versus last year as we continued executing on our cost reduction program with approximately $80 million of savings delivered in the quarter, consistent with the first quarter. The strong savings delivery in the first half of 2021, coupled with the acceleration of certain projects into the year, give us confidence to raise our savings target for the year to approximately $300 million, compared to the previous target of over $200 million. At the same time, the successful closing of the Wella transaction and strong free cash flow drove our financial debt down to $4.8 billion, with an economic net debt of $3.6 billion when taking into account the value of our retained Wella stake. At the same time, despite the resurgence of COVID-19 and related lockdowns in multiple parts of the world, we delivered Q2 revenues in line with expectations, including a one percentage point improvement in like-for-like trends to -18%. Most importantly, we made tangible progress on our strategic priorities, which, as you recall, include, one, moving our e-commerce business from a catch-up mode to a momentum mode. Second, building out our presence in China. Three, strengthening our foothold in white space opportunities, including prestige, cosmetics, and skincare. Four, building market-leading innovation, and as a result, strengthening our core prestige fragrance business and stabilizing market share in our mass beauty business. Building on the progress last quarter, we continued to strengthen our executive leadership team in recent months, including Stefano Curti, joining as Chief Brands Officer, Consumer Beauty. Alexis Vaganay, promoted Chief Commercial Officer, Consumer Beauty. Laurent Mercier elevated to Coty CFO, and Stéphane Delbos promoted to Chief Procurement Officer. The new Coty team is now in place, bringing strong beauty and business experience, deep knowledge of Coty, and relevant knowledge of new areas like skincare. At the same time, we are supported by a strong and female majority board of directors, including the recent addition of two new directors, Anna Adeola Makanju and Mariasun Aramburuzabala Larregui. Let me now spend some time reviewing our recent revenue trends, as well as provide more details on our strategic progress. Our second quarter sales came in line with expectations, even as the environment was disrupted in many parts of the world by a resurgence of COVID-19. This resurgence and the lockdowns announced in early November had been a key reason why we had suggested that sales trends would improve moderately in the second quarter, and this played out as expected with like-for-like sales down -18% compared to -19% in the first quarter. Within this framework, we saw diverging trends across our channels. Our prestige business, which accounts for approximately 60% of our overall sales, declined at -16% like-for-like in Q2, which was a meaningful sequential improvement of nine percentage points versus Q1. Excluding travel retail, which remains heavily impacted by COVID, our prestige business declined at -9%. During Q2, we continued to see the trend of resurging prestige fragrance demand in several markets, particularly in the U.S., where luxury fragrances once again outperformed luxury skincare and luxury cosmetics, as well as many parts of Asia, including China, Australia, Singapore, and Thailand. This improvement in the prestige fragrance category, coupled with the growing contribution from our Gucci and Burberry cosmetics line, which are becoming the second leg of our prestige portfolio, help drive this sequential improvement in our prestige business. At the same time, our mass business decelerated in Q2 to -22% like-for-like. With the uptick of COVID cases and shutdowns coinciding with the holiday season and usual social occasions, there was a pronounced deceleration in mass cosmetics category trends in most markets. This, coupled with some trade restocking benefit in Q1, drove the deceleration in our mass business. From a regional perspective now, the Americas, which account for 40% of our revenues, continued their relative outperformance. I'm excited to share that our U.S. prestige business returned to growth, this helped partially offset the mass beauty weakness, resulting in a 7% like-for-like decline in the overall Americas. EMEA, which accounts for nearly half of our business, remained heavily pressured by COVID and multiple lockdowns, driving a mid-20s decline in our like-for-like sales. In Asia Pacific, half of the -17% like-for-like decline was driven by the pressure in travel retail. While our sell-in for the region was negatively impacted by our continued cuts in low-quality distribution, the sell-out of our prestige brands across the Asia Pacific region was very strong, in many cases outperforming the market. While the headline number showed some improvement in sales trends, I'm pleased to say that we have continued to make very tangible progress on the strategic priorities we shared with you on the past two earnings calls. One of these priorities centered on accelerating our digital and e-commerce capabilities with a strategic focus on direct-to-consumer. Building on the momentum in Q1, our second quarter e-commerce sales grew 40% year-over-year, with the e-commerce penetration reaching 19% and helping overall margins. This growth was broad-based, with over 50% online revenue growth in the Americas, 30% growth in Europe, 45% growth in prestige, and 20% growth in mass. U.S. was the fastest growing market, with over 60% e-commerce revenue growth fiscal year to date. EMEA is our largest e-commerce region and the number one contributor to growth. While in APAC, we continue to reduce low-quality sales and distribution. Finally, travel retail e-com is beginning to accelerate. At the brand level, our e-commerce powerhouses include Hugo Boss in luxury and Rimmel in mass, with booming e-com businesses from Sally Hansen and Chloé Fragrances. Underpinning this e-commerce momentum were multiple initiatives and of course, digital activations. As one of only 15 companies globally to be admitted to Amazon's Global Vendor Management Program, we have been working very closely with Amazon to share data, improve service levels, and trial new programs. One of these initiatives was Vendor Flex Warehousing, where Amazon set up a fulfillment operation inside a Coty warehouse in the U.K. This drove down the delivery lead time from seven days to three days, which is a critical driver for consumer purchases. In the U.S., we have also initiated our first Spanish language Amazon media campaign, resulting in an uptick in consumers in this critical demographic, with 70% of them new to our brands. These initiatives, amongst many others, helped Coty double our market share of Amazon's mass beauty business with brands like COVERGIRL consistently outperforming its peers at this critical customer. We also work closely with Snapchat on best-in-class activations, including snap ads for COVERGIRL Clean Fresh makeup line, Marc Jacobs Perfect fragrance, as well as Sally Hansen nail polish try-on lens. The efforts resulted in sales across these product lines significantly over-indexing to Gen Z consumers. Finally, our creative TikTok campaigns for Marc Jacobs Perfect fragrance and COVERGIRL Clean Fresh makeup have each garnered close to 10 billion views, further cementing both launches with younger consumers. In fact, the Marc Jacobs campaign surpassed TikTok beauty averages in video views, engagements, and engagement rates for the entire first half of calendar 2020. Now our second strategic priority, which is expanding our footprint in China. We have continued to drive this effort with two powerful and beautiful brands in our prestige portfolio, Gucci and Burberry, both of which are highly desired by Chinese consumers. We are laser-focused on building out the beauty franchises of both brands by expanding their cosmetic assortment, engaging key opinion leaders, and building excitement through in-store and of course, digital activations. In Q2 and entering Q3, we saw their momentum accelerate. Even a sell-out for our overall prestige business in China grew strongly. Sell-out for Gucci Beauty and Burberry Beauty grew strong double digits. Other prestige brands driving strong sell-out in China include Calvin Klein on JD.com, Chloé, as well as a year-to-date performance in Tiffany. As we discussed on the last call, at the end of Q2, we launched Gucci's first liquid foundation, formulated specifically for Chinese consumers. The excitement is also evident on social media, with Gucci makeup ranked number three amongst all beauty brands, and number two amongst makeup brands in social buzz. This week, we are adding a key pillar in Gucci's China strategy with the opening of the Gucci Beauty flagship store on Tmall, overnight bringing Gucci Beauty to over 700 million Chinese consumers. While this is a soft opening, with a grand opening and full support planned for March, April, we see tremendous potential for Gucci on Tmall in the coming years. At the same time, we have been moving quickly to capitalize on the moving tourist activity and luxury purchases in Hainan, Sanya Island. We have opened three doors in Hainan, with three more planned in the second half of this fiscal year. As sales have continued to build up in these doors, Gucci makeup is already accounting for over 50% of our sell-out. Our third strategic priority is expanding into white space opportunities, including prestige cosmetics and of course, skincare. I have already discussed the strong momentum we have seen in Gucci makeup in China. However, this success is mirrored in many parts of the world. In the second quarter, Gucci makeup retail sales grew by five times in China, doubled in the U.S., and tripled Thailand and Singapore. In the first month of launch, the Gucci Liquid Foundation sold over 35,000 units globally. Burberry Beauty sell-out likewise grew by close to +50% in China. On the skincare side, our U.S.-centric philosophy brand grew in Q2 thanks to strong momentum, in particular on DTC and e-commerce. As for Kylie Cosmetics, the business continues to perform consistently with Q2 revenues in line with Q1. It's evident that consumer engagement with Kylie and her products remains very, very strong. The Kylie Skin Advent Calendar and Skincare Fridges, each priced at over $100, both sold out in roughly five minutes. Harnessing the social listening capabilities on Kylie's DTC site and tapping into the current consumer desire for self-care, we launched Kylie's rose-scented bath collection during the quarter, which reached over $1 million in sales in one day. The incredibly fast sell-out on these launches confirm that we continue to strengthen the drop model, which is critical to a personality-driven DTC brand like Kylie Cosmetics. At the same time, we are strengthening the fundamentals and building the brand for long-term growth. This is evident in skincare, where we continue to see good momentum with the Kylie Skin direct-to-consumer website, with revenues up versus first quarter and versus the prior year. As COVID-related lockdowns begin to lift, we are optimistic about the potential of Kylie Skin in retailers across the U.S., Europe, and Australia, supported by our unique brand installations. Looking forward, it's important to note that Kylie's prior manufacturing arrangement for its color cosmetics line with a third-party manufacturer recently expired. We are working with Kylie on a new cosmetics line to be launched this coming summer 2021, which will also be a great opportunity to significantly improve the consumer experience with one website portal developed and supported by Coty, offering the full collection of Kylie's beauty products across cosmetics and skincare. In the meantime, we continue to focus on building the Kylie Skin business with new launches and activations planned for the coming months. Altogether, we have continued to make progress in expanding into the white spaces opportunities of prestige, cosmetics, and skincare with these two categories already accounting for 8% of our revenues in the first half of 2021, up from 6% in fiscal 2020. Our fourth strategic priority, and a key in making Coty a product-centric company, is to continue building market-leading innovation that builds on the universality and deep equity of our brand portfolio. With the conclusion of calendar 2020, I am thrilled that Marc Jacobs Perfect Fragrance has ended the year as the number one fragrance launch across the U.S., U.K., Canada, and Australia. In fact, Perfect is tracking to be the largest Coty fragrance launch in the U.S. for the past 15 years. This speaks not only to the appeal of its messaging, celebrating self-expression, authenticity, individuality, but also to the quality of its juice, packaging, and very, very unique media activation. Another fragrance this year has been Hugo Boss Alive. Launched at the start of the calendar year, this has been the number one fragrance launch in Germany and has also underpinned 30% growth for Hugo Boss female fragrance business in the U.K. On the mass side now, we have continued to build on the success of the first two mass clean beauty lines we introduced under the COVERGIRL brand with the recent launch of COVERGIRL Lash Blast Clean Mascara, part of our effort to concentrate on the two leading categories of COVERGIRL eyes and face makeup. Building on the iconic Lash Blast franchise, this new volumizing mascara has a clean, vegan formula free from contested ingredients. It's also certified cruelty-free, a key pillar for COVERGIRL. While still in early stages of the launch, this new mascara is seeing strong success. Already a top three COVERGIRL SKU at the key retailers, and providing a halo effect on Amazon with a 10% lift to the total Lash Blast franchise. The launch is also over-indexing with Gen Z and Hispanic consumers, a key part of the market we were missing previously. In conjunction with the launch of Lash Blast Clean Mascara, in the coming days, we will begin airing the first part of the new COVERGIRL image and positioning that has been fine-tuned during Q2. The new campaign reinforces our strategic work over the past year to steadily build COVERGIRL's clean pillar, which began with Clean Fresh Foundation last spring, followed by Clean Fresh Pressed Powder, and now the Lash Blast Clean Mascara. Finally, on Rimmel, we recently revamped a core pillar, the Lasting Finish 25hr Foundation. Boasting full coverage, a long-lasting, and of course, mask-friendly transfer-proof formula with hydrating ingredients, this revamp has helped Rimmel regain its spot as the number one foundation in the U.K. market. It also nearly doubled sales for the franchise in Australia. Our final strategic priority is accelerating our core prestige fragrance portfolio and stabilizing market share in our mass beauty portfolio. Building on the recovery emerging in the first quarter, we're happy to report that prestige fragrance category is back to growth in several markets, including in the U.S., China, Australia, Singapore, Thailand. In many cases, outperforming prestige skincare and prestige makeup. This outperformance appears to be driven by consumers redirecting their discretionary spending to mood-boosting categories with a higher emotional appeal, while also indulging in self-gifting. Against this backdrop, Coty brands such as Gucci, Burberry, and Marc Jacobs has seen strong sell-out growth ranging from high single digits to double digits, depending on the markets. Noting the strong momentum behind artisanal fragrances in many parts of the world, this is an area where we intend to expand quite quickly with several projects underway for several of our brands. On the mass beauty side now, while much work remains to be done, we're making progress towards our objective of stabilizing our market share. Broadly, the North America and Europe mass beauty market, particularly cosmetics, remain pressured by resurgence of COVID, and this is driving weakness in our mass beauty portfolio. At the same time, though, we are progressing on the market share side. While Coty's portfolio globally lost an average of 100 basis points of market share in the first nine months of calendar 2020, in the last quarter, the market share decline narrowed to approximately 80 basis points. Central to this share stabilization is the tremendous growth that our mass brands are seeing online, particularly on Amazon, even as performance in brick and mortar is more pressured. Also underpinning the improvement are multiple brand country combinations. Sally Hansen continues being strong in the U.S., U.K., Canada, Australia, and Italy, driven by franchises such as Miracle Gel or the clean Good. Kind. Pure. line and nail treatment products. Rimmel continues to strengthen its position as the U.K.'s number one makeup brand, seeing no less than 18 months of market share growth, while also winning in Italy and Poland. bruno banani fragrances continue to win in its core German markets. In Brazil, sell-out of our portfolio of local brands has been growing in the double digits in recent months, two times the level of the market, led by brands such as Monange in deodorants and Risqué in nail. Broadly, on a brand and strategy level, we have finalized our brand equity and geographic mapping for each of our core color cosmetic brands, as well as adidas, which we intend to share in the coming months. The progress in stabilizing our mass market share confirms that we are starting to see results from our dual strategy of making each and every brand positioned on Coty's key drivers of self-expression on the one side and healthy, clean alternatives on the other side. Let me now turn it over to Laurent to comment on our financial results and of course, outlook. Thank you, Sue. Having been with Coty for those three years in different capacities, I had the pleasure to work closely with Pierre-André Térisse for the past two years. I am excited to continue building on what we started together and lead as CFO this next phase of growth and transformation. Before I go into our profit delivery for the quarter, let me first touch on how we will be measuring and discussing our performance going forward. First, we will now use adjusted EBITDA as our main KPI for profits, with EBITDA based on adjusted operating income plus depreciation and non-cash stock compensation in order to more directly drive and highlight our focus on cash flow and deleveraging, which remain key priorities. Second, we have decided to recognize our retained 40% Wella stake on a fair value basis going forward, recording only the changes in fair value in the P&L. With this in mind, let's turn to the shape of the P&L in Q2. Our Q2 gross margin of 58.7% was stable with Q1 2021 and in line with fiscal year 2020 average. The adjusted operating income of $188 million for continuing operations was well ahead of consensus expectations of approximately $160 million. This translated to adjusted EBITDA of $284 million for continuing operations with a margin of 20.1%, up 400 basis points year-over-year. Including our Wella cost reimbursement, the adjusted EBITDA totaled $294 million, or a 20.8% margin. The achievement of 6% profit growth despite double-digit sales decline and stranded cost was supported by the combination of, A. very focused marketing investment at approximately 20% of net revenues and in line with Q1 as we continued our pay-as-we-go marketing deployment strategy. B. strong fixed cost reduction as part of our broader cost reduction program. Looking at our cost reduction progress in more detail. In Q2, our fixed cost decreased by 12% year-over-year. We achieved approximately $80 million of savings in Q2, a level consistent with Q1. As a result, we have achieved $160 million of savings year- to- date. The biggest component of the savings delivered in H1 2021 has been headcount reduction, accounting for close to 30%. Beyond that, the biggest contributors have been significant cuts in business services, including consultants, recruiters, IT, real estate, and facility management costs, followed by direct and indirect procurement savings across cost of goods and A&CP. While not impacting fiscal year 2021 savings delivery, we recently announced the consolidation of our fragrance manufacturing footprint with the closing of our German plant to be completed by summer 2022. This was a difficult decision to take, but a necessary one to address the overcapacity in our supply network. This consolidates our fragrance manufacturing into two remaining plants in Spain and France. The strong delivery in H1 2021, coupled with the acceleration of certain projects into the year, are driving an increase to the savings target for fiscal year 2021, now expected to be approximately $300 million compared to the previous target of over $200 million. We remain on track for our saving target of $600 million by end of fiscal year 2023. Turning now to EPS. With adjusted EBITDA for the quarter of $284 million, less $96 million in depreciation and non-cash stock compensation, close to $60 million of interest expense, an 8.5% adjusted effective tax rate, and two months of net income contribution from Wella, the Q2 diluted adjusted EPS for total Coty ended at $0.17. For H1 2021, based on $450 million of adjusted EBITDA, $180 million of depreciation and stock compensation, roughly $120 million of interest expense, and an adjusted effective tax rate of 12.5%, the diluted adjusted EPS for total Coty ended at $0.28. In the same period, the reported EPS came in at a negative $0.10, impacted by the Wella transaction cost and restructuring accruals under the cost reduction program. To help frame the various puts and takes in EPS going forward, there are a few things to keep in mind. First, it's worth noting that while depreciation is likely to stay fairly steady, the stock compensation component will step up beginning in Q3. Second, on the tax line, we've had a few positive discrete items in H1 2021, but for the year, we continue to expect an adjusted effective tax rate in the low twenties. Third, as stated earlier, beginning in Q3, we will not show the earnings of Wella in our P&L, but we'll instead record any changes in Wella's fair market value. Finally, on the convertible preferred stock, so far, we have been opting to accrue the coupon, resulting in incremental dilution. Going forward, we intend to pay the coupon in cash, allowing the diluted share count to stabilize. Looking now at free cash flow for the quarter, which came in very strong at approximately $390 million, up $26 million versus the prior year. Underpinning this solid performance was strong operating income and EBITDA for the quarter, coupled with two months of contribution from Wella. We also continued our strong working capital and CapEx management in the quarter, including material reduction. At the same time, it's important to point out that the completion of the Wella transaction within the quarter and the finalized working capital transfers resulted in $200 million of positive working capital benefits in Q2, which will reverse next quarter. Turning now to our capital structure. I am happy to report that with the successful completion of the Wella transaction, with gross proceeds of $2.9 billion and our strong free cash flow of $389 million, our net debt at the end of Q2 stood at $4.8 billion. This, in fact, included over $300 million of negative impact on our debt from foreign exchange. Factoring in our retained stake in Wella, valued at quarter end at approximately $1.2 billion, our economic net debt fell to approximately $3.6 billion. We also maintain comfortable headroom under our financial debt covenants. Our capital structure remains very attractive, with key maturities in 2023 and 2025, and a cost of debt below 4%. It is important to highlight that with our net debt closing below $5 billion, this is a true milestone for Coty and sets up for continued improvement in the coming years. Turning now to our fiscal year 2021 outlook. Despite continued disruption to sales channels and short-term orders related to the COVID-19 pandemic, we remain focused on our strategic priorities. With cost savings expected to reach approximately $300 million for this fiscal year, and having in mind revenue trends and our intention to step up investment, we now expect adjusted EBITDA of $750 million for fiscal year 2021. With the financial net debt that has now crossed below $5 billion, we will continue to derive our leverage ratio towards 5 x by the end of calendar year 2021, in line with our prior guidance. Let me now turn it over to Sue for some concluding remarks. Thank you very much, Laurent. With the new Coty team now in place, it's clear to me that a stronger Coty is continuing to emerge. In the current volatile context, our focus is on optimizing short-term revenues and, of course, sell-outs. As we continue to control our costs and debt, we are shifting our focus now to accelerating our top line, guided by our strategic pillars. One, digital and e-commerce acceleration. Second, building out our presence in China. Three, expanding into white space opportunities, including prestige cosmetics and skincare, and of course, strengthening our core fragrance and cosmetic businesses through leading innovation and improved execution. The additional fiscal 2021 cost savings will enable the profit delivery we have guided to, while at the same time increasing our commercial investment in the second half of fiscal 2021. In fact, we are like a boat setting sail now and letting go all of excess weight. The lighter we emerge from this crisis, the faster we will go, knowing how desirable many of our brands are. As we have finalized our strategic review, including new growth opportunities, brand equity mapping, and a repositioning plan for our core mass brands, we plan to share our strategic priorities around accelerating growth in mid-April with a full investor day planned for fall 2021. I'm really excited by the tremendous opportunities and exciting journey ahead for Coty, and look forward to sharing this vision in the coming months. Thank you very much for your time, and we are now pleased to take any questions. Thank you. At this time i'd like to remind everyone if you would like to ask a question press star then number one on your telephone keypad. If your question has been answered and you like to remove yourself from the queue, press the pound key. Our first question comes from the line of Olivia Tong of Bank of America. Great. Thanks. Good morning. Wanted to ask about cost and then wanted to ask about China. On cost, can you just talk about what drove the incremental savings? Is it additional headcount reductions, more manufacturing consolidation, advertising, media efficiencies? Then can you talk about the redeployment of that investment towards investment to drive growth in key markets or channels like e-commerce? Now that you have four months left in the year, what's your view in terms of getting back to margins more in line with 2019? Then I have a follow-up. Thank you. Okay. Hello, Olivia. On cost, incremental savings as I explained, is really across all initiatives. We really continue intensifying headcount reductions, but also on all non-people cost. We continue the journey, and we really accelerate all the actions we initiated in H1. It's not one specific bucket or another, is really all across the board. Now to answer your question on margins, definitely what we are aiming at, is a high single digit, and you see the result in H1, which confirms this trajectory. Great. Thanks. I wanted to talk a little bit about, the expansion of Gucci Beauty onto Tmall and your view on the opportunity there, if there are other brands in your portfolio that you think could resonate particularly well in China, and how much investment you think that would necessitate in your view. Just also, what about the social media brands like Kylie and KKW? How do you think about their potential in China? Overarchingly, how do you think about the opportunity for profitability long-term in China? Thank you. Hello, Olivia, this is Sue speaking. To answer the first question about China and the Tmall soft opening that we're doing at the moment. The great news is that we have now a range under Gucci Beauty brand, but same thing under Burberry brand, by the way. Under Gucci brand, we have now a comprehensive range. We were operating on areas such as lipsticks, powders, pencils, mascara, which are, I would say, a tiny part of the market. Now with the launch of the new foundation, Fluide De Beauté, that's arrived in January, we are suddenly operating on the biggest chunk of the market. The results that we have had during January, which is the first month, are outstanding. We sold 35,000 units in a very, very little number of locations globally and especially in APAC and in China. The feedback is absolutely great about the product. We, of course, are super excited by the new door that's opening because suddenly Gucci Beauty, super desirable image and line is now plugged into a huge, huge, I would say, machine that's called Tmall Pavilion, that will give us the reach of 700+ million users in China. You can imagine when a super desirable brand that's putting on the market the best quality products on the right areas of the market meets the power of Tmall, there is clearly big potential for Gucci, but also Burberry and overall for our luxury business in general. Clearly the next steps we are thinking about is how can we operate skincare in this area of the world, but also on Tmall. To answer your questions about Kim and Kylie, when it comes to Kylie general line, the line is delivering consistently with the first quarter. Skincare is accelerating between the first and the second quarter globally and versus last year. We are at the moment adapting the products of Kylie line to the Asian Chinese market so that when we go there, we go with the right offer precisely for the, I would say, customers of this area of the world that has very, very specific needs. When it comes to Kim Kardashian line, which is scheduled for fiscal 2022, skincare line, it's going to be a line, hopefully, that's going to have everything that's needed to compete on the Chinese and Asian market. Our next question comes from the line of Wendy Nicholson of Citi. Hi. Good morning. My first question- Good morning. Sue, maybe just has to do with the level of internal controls at the company. I think historically one thing that made the story so frustrating was that often there was guidance given or there were targets for certain launches or expectations that then the company failed to deliver upon, and there were things like massive SKU assortment that the company just didn't have any ability to manage. I'm wondering, just as you come in with your new management team, do you think you need to make investments in IT or infrastructure just so that when you're putting a lot of money behind something like COVERGIRL, you have an accurate read on how that launch is doing, just so that you can adapt and pivot and shift, as need be? Hi, Wendy. Thank you for this question. We've been saying that since this, I would say, pandemic started, we've been really revisiting everything we are doing at Coty, starting from the way we create products, and nothing goes out if it's not, as I usually love to say, new, better, and different, which is really something that was not the case in the past. A good way to avoid, as you said, overstocks is to do products that sell. This is, I would say, basic, but it was probably not always respected in the past. The second thing we have been doing, and we are doing on a monthly basis today, is called pay-as-we-go sessions. This is probably the first time, I don't know what's happening in other companies, but from my past experiences, it's the first time that this goes up to the level of the CEO with a top-down, bottom-up way of working to make sure we are putting our money on bets that are really bets we all believe in, but not only believe in, bets that have tests and studies and anything that needs to be done to confirm that we are putting money behind products and launches that are going to deliver and ideally over-deliver. This is one of the main reasons I have been sometimes postponing some of the launches because I felt they were not ready, either in terms of formulation, in terms of cleanliness, sustainability, or in terms simply of non-efficient advertising. This is really something that we are putting in place at a company level, at different levels of the company, and this goes up to the CEO level, which is, I think, unseen anywhere else. That's all fair, that sounds great. Hopefully that works better than it has in the past. My second question is, kind of the biggest bear thesis on the stock right now is that you are cutting advertising to sort of make the numbers and show higher EBITDA growth in the short term, but that that's not actually going to be good for the business. Can you talk about kind of a target level of advertising? I know you said you expect to increase that, but in terms of your overall spending, do you think you have the right approach to investing in the business while at the same time, managing to show EBITDA growth and that it's not going to be a trade-off between the two? Thanks so much. Thank you, Wendy. As you know, as we said it earlier during the presentation of the results, the main areas of cost savings were headcount reduction on one side and business services on the other side. We are doing everything to protect what we call the A&CP, and specifically the working media. As Laurent mentioned, the working media for the second quarter were in line with the ones from the first quarter, around 20%, A&CP in general. Working media, we try to preserve as much as possible. The good news is that during Q3, what we are targeting is being at the level in absolute value of what we have been spending in terms of working media during the year 2019, which is pre-pandemic. This is really something that is super important as you have mentioned it, and this is going to allow us to invest, I would say, working media on fewer but bigger initiatives since we are going to be using amounts of money that are what we used to spend in normal years. It's a big change. This is again, in a way correcting the feeling that you mentioned at the beginning of the question. We are not cutting on working media. On non-working media, we are doing a lot of renegotiation and what we call other A&CP, which usually are about BAs and anything we do in stores. We are adapting to the situation of the different regions. As you can imagine, we've been super flexible to lower this bucket when it comes to travel retail, and we're happy we've been able to do it because today, stores are closed, and we're doing exactly the same thing on other areas in the world where other A&CP can very flexibly, easily be resetted up or down. Our next question comes from the line of Andrea Teixeira of JP Morgan. [Foreign language]. Hi. Thank you, and good morning. I appreciate the comments about Kylie. Can you please elaborate more about the plans ahead and also to the Kim Kardashian skincare embedded in your outlook and the timing of those launches? Just as a second, just a clarification on fragrances, what is the typical percentage of sales of fragrances in the month of December? I understand on a normalized basis about 50%. You seem obviously upbeat with the momentum, and Gucci, and how confident are you are as you keep growing this area, offsetting the mass makeup declines in the next few quarters, despite the seasonally weaker performance and potentially this stocking? Thank you. To answer the first question, I'll do question after question. The first question is about Kylie and Kim Kardashian West beauty businesses. When it comes to Kylie, as you know, there was a manufacturing agreement that has recently expired. We intend to launch new cosmetics lines under the Kylie Jenner Beauty around next summer, and this is clearly, I would say, the next step for this line. We continue to do our very successful drop model. This is really something that the Kardashians in general, and Kylie Jenner specifically invented some years ago, which is a key driver of traffic and therefore, sales on our DTC websites. We are continuing in this area, and new cosmetics line arriving in next summer. When it comes to Kim Kardashian, and again, we are clearly positioning these two brands very differently. Kylie becoming a key destination for any beauty need when it comes to Gen Z and millennials. This is the way we're going to expand Kylie in the future, and it's going to be across several categories and not linked to specific categories. When it comes to Kim, we are progressing very well hand in hand with Kim in creating, hopefully, a skincare line that's going to be again, new, better, and different, and bringing to her hundreds and hundreds of millions of followers around the world, the ability to access the latest dermatological or ingredient or I would say, health, skin health trends that her followers are looking for. This is what's going to happen on Kylie on one side and on Kim on the other side. When it comes to the fragrance business, this size of the business, we think that the prestige fragrance category strength in certain markets should continue, seeing that the U.S. and China through January are doing still very well. The other reason that gives me confidence. We've been watching one key launch that we have done at Coty. It's Perfect by Marc Jacobs. We said it during the call earlier, this launch is probably Coty's biggest fragrance launch in the last 15 years. You have to think that the biggest fragrance launch happened in the middle of a pandemic. What made it the biggest launch in the history of Coty? It's simply because we've been shifting the way we do launches totally to a new mindset, a new way of doing things. First, the advertising has nothing to do with the classical one spokesperson advertising that is usually, I would say, the common standard in the industry. We've been using 40 people from all ethnicities, ages, genders, whatever you want, and these people promoted the fragrance online. For me, this has been a powerful way to replace the lack of store visits to test and smell the fragrance. If you listen and hear these people and their audiences sharing, for those who bought online the products, they were sharing to each other why they love the scents, et cetera. In a way, they are virtually inventing fragrance testing. For me, it's going to last. I strongly believe it's going to last. This campaign had on TikTok more than 10 billion views. It's clearly surpassing all TikTok standards. It shows us a new way to sell fragrances that's, in a way, not being stopped by the lack of testing that usually is the case when you launch a fragrance. I'm quite confident for the future on this topic. Our next question comes from the line of Steph Wissink of Jefferies. Thank you. Good morning, everyone. Our question is twofold. It is first on gross margins. We are wondering, Laurent, if you can spend a little time just sharing with us where gross margins landed relative to your expectations. They came in a bit below where we were expecting, and I just wanted to reconcile if that is partly related to the cost restructuring and where that is located within the P&L. Secondly, on your EBITDA guidance for the year, I think you mentioned in your press release that the current quarter is pacing on trend in terms of where your sales expectations are, but could you help us think through again the body of the P&L and where we should expect some of the puts and takes between gross margin and OpEx as we look at the back half versus the first half? Thank you. Okay. Hello, Steph. Thanks for your question. Gross margin, definitely, the big impact is related to COVID-19 pandemic. It's definitely that, of course, lower volumes is impacting fixed cost absorption. This is something that we had anticipated in our Q2 equation. It's creating also some tension on gross to net and also to some extent on mix. Of course, as Sue mentioned, Europe is facing the lockdown and big markets and big brands. These are really related to the COVID-19. We anticipated definitely in our equation. Now definitely, to answer your point on productivity, in our gross margin, we have some positive productivity from supply chain and procurement, and this is helping to mitigate part of the negative COVID-19 headwinds. Now building on what's next, definitely step by step, these negative COVID headwinds will disappear, while at the same time, the productivity and part of this $300 million savings will start to reflect in the gross margin improvement. This is just to give you some flavor on gross margin, but as you could see, we are in line with our Q1 EBITDA guidance. Definitely the equation is really, as we mentioned, is definitely we are delivering the $300 million savings. This is really the work we are doing, and we delivered 18 Q1, 18 Q2. Now what we are working together with Sue and the executive committee is, of course, as Sue mentioned, with the pay- as- we- go, we are reallocating some of these savings, very targeted way to the actions which are working on the working media and where we have a very good ROI. This is really the triangle we are building. Savings, target investment, and then delivering the EBITDA that we are sharing with you today. Our next question comes from the line of Robert Ottenstein of Evercore. Great. Thank you very much. You identified main digital initiatives, I think is your number one strategic priority, which obviously makes a tremendous amount of sense. Can you talk about kind of where you are, where you think you are in terms of your investment curve? Obviously, this is an area that requires a lot of technology, a lot of upskilling of the workforce, kind of a general change of how you do business in general. Perhaps if you can tell us kind of where you are in that progression, how much more you need to invest to get where you need to be. Thank you. Hello, good morning, Robert. This is Sue speaking. You're right to say again that the e-com net revenues are growing super fast at 40%, plus 40% again. The penetration is Today, reaching the level of 19%, clearly driven by our luxury business, but our mass business is also doing very well, especially at e-retailers such as Amazon. We have areas like Americas that are having +50% growth, EMEA +30%. Prestige, as I said it before, is driving the growth as +45%, and mass is also +20%. In terms of what is needed to go to the next step, as you know, we've been for the first time announcing the arrival of the first Chief Digital Officer at Coty, Jean-Denis Mariani, who joined the company in November. Jean-Denis is doing huge progress with his teams worldwide to put in place what needs to be put in place in terms first of having all the assets that this area of the business is requiring. Some call it CARs. It's about content and the right investment and the right assets, et cetera. This is something that we are going to accelerate in the next months and think about the best way to organize this in-house here at Coty. This is how I see it. It's clearly an area where there is wind behind us. We have the brands. Most of our brands have huge followings on Instagram. I was calculating the other day that if you add our own brands plus the fashion houses that we are working with, and if you add also our, I would say personalities, we have a reach of 700 million people. If you add this 700 million people reach, and you add next to it the new Tmall opening that we have just done, for Coty in the last, I would say two to three years, suddenly there is a direct way to address consumers that are as numerous as 1.4 billion people around the world. It's a super strong opportunity, and you're right, we'll need to finance this. This is clearly part of our key priorities, and pay- as- we- go that Laurent mentioned several times, it's not only about where do we put our money in terms of advertising, and clearly we've been shifting strongly media towards digital. It's also in terms of CapEx and investments for the future that we are doing exactly at this time of the moment. Our next question comes from the line of Lauren Lieberman of Barclays. Thanks very much. Good morning. Good morning. I was curious if you could talk a little bit about the Singles Day shopping holiday. To what degree do you think that that contributed to some of the outsized performance in the quarter? Also, I'm curious about activations, and maybe it was too soon, with the Tmall launch more coming this quarter for Gucci. I'm curious the activations there and then also plans looking ahead to Lunar New Year. Maybe the business isn't quite there yet, but I was curious to learn a bit about that. Thanks. Morning, Lauren. You're right. We are doing a soft launch at the moment at Tmall. We are putting in place the different assets, the products, et cetera. We are not yet into this super high, I would say promotional moments that are happening in China and in the Asian world. We'll see this hopefully happening. We'll see hopefully how we are going to benefit full potential from this launch at Tmall, probably around the end of the third quarter, beginning of the fourth quarter. This is one. Second, we will need to find our way to be part of this highly promotional moment because we are operating highly desirable and highly, I would say, luxurious and prestigious brands. This is something that we are working hard to make sure we are still having the same level of excitement, et cetera, without compromising the image of our brands. We can, of course, we are starting to think about some other brands that are already into that game, such as adidas or Calvin Klein, which are doing very, very big, but they are not at the moment big drivers of the growth in China. Our next question comes from the line of Faiza Alwy of Deutsche Bank. Yes. Hi, good morning. A couple of related questions for you, Sue. First is, how are you thinking about the evolution of the makeup category as we exit COVID? You've previously talked about the skinification of makeup, and it does seem that every small makeup brand has launched a skincare brand. Maybe you can talk about how this is impacting your approach to reinvestments, because I hear you talking a lot about marketing and commercial investments, which are apparent. But as we think about skincare, in my mind at least, it seems like efficacy and performance really matters for consumer retention. Would love to get your perspective around this. Do you agree with the premise? And where do you think the company is in terms of R&D expertise, product quality? Is this an area where you think more investments need to be made, or are you satisfied with where you are? Thank you very much for your question. Again, thank you for asking me about R&D, because this is really a topic that's dear to my heart. I'm an engineer, so I love to spend time with R&D people and scientists, and also with the people who are operating our different factories. What I've been seeing is really fabulous IPs owned by Coty R&D. I've been mentioning this probably in the previous call, but Coty owns key IPs in terms of long wear, if you speak about makeup. The success of brands such as Outlast by COVERGIRL, Lasting Finish 25 Hours at Rimmel, or many others are clearly based on this uniqueness in terms of IP that we do own at Coty. We also own a lot of IPs when it comes to what I call environmental protection, be it from the sun, from blue light, or from pollution. This is clearly something that the company has been continuing to progress on thanks to Lancaster, and we intend to expand this knowhow to numerous number of brands, skincare, but also makeup brands that are being more and more skinified, in other words. We have also IPs in the areas of ingredients inspired by dermatology, to make it simple. This area is an area where, again, Lancaster and Coty R&D has been operating for years and years. People are all talking about retinol since a few years now, and it's going to be higher and higher. Lancaster, for your information, was the inventor of vectorization of retinol in a skincare product, something like 20 or 25 years ago. This is really an area that the company has knowhow in, has expertise in, and has intellectual property in. We're going to build the skinification of makeup and the skinification of Coty business based on these key IPs that we own at Coty today. When it comes to the skinification of the makeup category, again, what we are seeing is that what's doing well in our business are what we call clean, healthy, and sustainable alternatives. COVERGIRL is leading the way in America in this area. Clean Fresh Makeup, number one foundation launch in 2020. The Clean Fresh powder that we launched in September was the number one powder. We are just launching right now Lash Blast Clean, the first mascara with clean, vegan, cruelty-free formulation, adapted for sensitive eyes, et cetera. This area of the business is clearly an area that's not only attracting, I would say, all consumers, but also strongly and over-indexing, I would say, Gen Z consumers and Hispanic consumers. This is an area that we intend to accelerate in the future. Thinking about skincare, of course, not only on our, I would say, color cosmetics brands, but also we can think about adidas, which is another brand of Coty portfolio, where we see a huge potential in terms of self-care, body care, and anything around fitness, beauty, related to beauty. This is the way I see the future of the company, confident on the ability to build on this, and you said it, on this efficacy, ingredient-led, science-led categories in several areas of our businesses, mass beauty, adidas, but also in our prestige skincare with brands such as Lancaster and philosophy, but also Kim and Kylie developing their future in skincare. Thank you. We have reached the allotted time for questions and answers for today. We thank you for participating in Coty's earnings conference call and webcast. You may now disconnect your lines and have a wonderful day.