EssilorLuxottica Société anonyme (EL) Earnings Call Transcript & Summary

Good morning, everybody. I'd like to welcome you to this Annual Shareholders' Meeting for EssilorLuxottica, and thank you for attending. It is with great pride that I declare our sixth ASM open with Paul and alongside us, all the executives of the group. With Leonardo Del Vecchio, we dreamed of a great group, a European champion, full of young talented people, innovation and technology. Today, we are celebrating the fact that this dream has come true. 6 years past since EssilorLuxottica was established today or created. Still with the same enthusiasm, we are working with determination to continue to achieve our shared vision. Paul and I would like to thank all our colleagues for the results they have achieved and to express our deepest gratitude for your support and your trust. I'm now going to hand over to Mr. Alexander Lunshof, Secretary to the meeting for the legal and technical formalities. Thank you.

Thank you, Mr. Chair. Dear shareholders, welcome to you all. I'd like to, first of all, draw your attention to the public nature of this general shareholder meeting, where there are a number of journalists attending in the room. It is forbidden to film or broadcast images of this meeting without prior authorization from the company. This meeting will be broadcasted later by the company's website starting from 6:30 this evening. Before we go into the presentations of all the speakers I propose that we compose the Executive Bureau of the meeting, of which Mr. Francesco Milleri will show its presidency in his capacity as Chairman of the Board of Directors. To fulfill the position of scrutineers, I'm going to ask 2 shareholders present with their largest number of votes and who have accepted to fulfill this position. Mr. Romolo Bardin, representing the reference, the lead shareholder, Delfin; and Ms. Virginie Mercier Pitre, representing Valoptec Association. I'd like to thank them for accepting the position of scrutineers. I'd like to thank Mr. Francesco Milleri and the scrutineers for having appointed me as Secretary to the meeting. The statutory auditors of our company are in attendance, in particular, Mr. Jean-Luc Barlet from the firm of Mazars, who will present the reports concerning the resolutions submitted to your approval. The provisional quorum amounts to 83.28% of shareholders. The general meeting having convened more than 25% of shares with voting rights and is now legally constituted and can deliberate legally both for the ordinary and extraordinary agenda. The final quorum will be announced before we vote on resolutions. The Executive Bureau of the meeting has available to you the newspapers in which the convocation and the prior notification of the meeting, stipulated by law along with all the documents stipulated by current statutes. All prior documents have been made available at the head -- the company's headquarters and on the website under Legal and Regulatories and Conditions. Shareholders were able to vote via Internet before the Annual Shareholders Meeting on the secure dedicated website, which opened on the 12th of April and which closed yesterday at 3:00 p.m. in accordance with current legislation. This meeting will be organized in the form of presentations. In particular, those by Mr. Francesco Milleri, Chairman and Chief Executive; and Paul du Saillant, Deputy Chief Executive, to be followed by the presentation by Mr. Stefano Grassi, concerning the 2023 annual results. And then by Stefano Genco, who will present an insight into Nuance Audio, a new disruptive technology that is at the crossroads of Vision and Audition; and Pierluigi Longo, who will present the vision and strategy of EssilorLuxottica for the digital transformation of the eye sight health sector. Elena Dimichino and Anurag Hans will talk about the noteworthy events in 2023 in terms of sustainable development and the EssilorLuxottica mission. In conclusion, I will hand over to Andrea Zappia, Chair of the Committee of Nomination and Compensation and to Jean-Luc Barlet, the statutory auditor. This will be followed by a session of questions and answers and votes on the draft resolutions. The agenda is first displayed behind me on the screen. I therefore suggest that we have a brief summary. The 34 resolutions proposed by the Board of Directors include 24 resolutions under the ordinary session of the meeting. Resolutions 1 to 3 concern the approval of the company and annual consolidated accounts and the allocation of results. Resolution 4 is intended to cover the agreements and regulatory commitments submitted to your approval as per legislation regulations. Resolutions 5 to 7 are intended to improve the compensation factors paid during 2023 to the company offices, say-on-pay or we call exposed. Resolutions 8 to 10 are intended to approve the compensation policy paid in 2023, 2 company officers, the say-on-pay or ex anti-vote. Resolutions 5 to 10 were specifically reviewed and adopted upon the proposal of the Nominations and Compensation Committee. Mr. Andrea Zappia will report on the committee's work on these compensation factors. Resolutions 11 to 22 are intended to appoint members of the Board. Resolution 23 concerns the appointment of PricewaterhouseCoopers Audit as the statutory auditor to certify the information concerning sustainability. Resolution 24 is intended to renew the authorization enabling the company to buy back its own shares. Then there will be 9 extraordinary resolutions. Resolution 25 concerns the authorization to be given to the Board of Directors to reduce the company's capital by canceling treasury shares. Resolutions 26 to 31 are intended to implement a range -- a comprehensive range of financial delegations to give the Board of Directors the requisite and flexibility under strictly defined limits to make the most of the operations that may occur. Each of these resolutions make it possible to increase capital equating to specific conditions and terms with a specific ceiling. Resolution 31 defines a global ceiling for all operations if they had to be combined. Resolution 32 is intended to renew the delegation of authority granted to the Board of Directors to decide on the increase in capital by issuing shares reserved or restricted to members of a corporate savings plan with the elimination of preferential subscription rights. Resolution 33 is intended to authorize the Board of Directors to award freely current shares, known as performance shares to members of the staff and/or company officers and executives. Finally, the last resolution, #34, under the ordinary system concerns the authority required for the legal formalities following the decisions made by the Annual Shareholders' Meeting. And now I'm going to hand over to Mr. Francesco Milleri, Chairman and Chief Executive Officer of EssilorLuxottica.

And now let's start with our presentation, which will give you more color on the strong result we have achieved as EssilorLuxottica. 6 years ago, we merged Essilor and Luxottica, 2 industry pioneers and leading global company. After 6 years, after 2 Board mandates with the acquisition of GrandVision and more than 100 other M&A transactions, we have built a vertical integrated powerhouse unlike anything else in the world. Today, we are among the top 10 CAC 40 companies, but EssilorLuxottica still remains a young company, a start-up with plenty of opportunities ahead from med to tech from luxury to digital. We are well on our way. I'm proud to share today an update on the key numbers we presented the last year that better describe what we achieved since the merge. This figure tell us a great story of success. Market capitalization. When we announced the merge on October 1, 2018, Essilor Luxottica had a market cap of EUR 46 billion. Today, it's above EUR 90 billion. But our aim is to cross soon the EUR 100 billion milestone. Revenues. In 2018, our pro forma revenues was approximately EUR 16 billion. We closed 2023 with a EUR 25.4 billion revenues, a 57% increase. Net income. It amounted to EUR 1.8 billion 6 years ago. Today is EUR 2.9 billion with a 66% increase. Dividends. In 2018, we paid EUR 0.9 billion in dividends. 6 years later, we have doubled that value, distributing dividend for EUR 1.8 billion. Employees and employee shareholders. We had 140,000 employees at the birth of EssilorLuxottica. Today, we are a global community of more than 200,000 people. Nearly half of our employees around the globe are shareholder of the company. They are 80,000 today, almost double in the original community, reflecting their confidence in our group. In 6 years, we have redistributed to all our employees, EUR 4 billion. Of the value created, EUR 1 billion just in 2023 in the form annual performance bonus, performance shares, share matching, profit sharing and dividends, all this on top of ordinary remuneration. And the share price have moved in the last 6 years with the same pace. We closed last Friday at the EUR 203 or EUR 203 per share, almost doubling our first trading day in French Stock Exchange. As you see, despite the difficult and a certain time we have gone through, the pandemic, ongoing conflict in Ukraine and in the Middle East, growing inflection and more. Our group -- your group is stronger than ever. We have built the only end-to-end player in the industry. Think about it. EssilorLuxottica has a leading presence across all geographies, all business segments and all trade channels. We are one of the leading specialty retailers in the world. We realized our vision of EssilorLuxottica as an open, collaborative and omnichannel company capable of elevating the whole industry, bringing every player with us. To continue writing this beautiful story of our industry and to expand beyond boundaries, we have a clear vision based on 3 main strategic drivers. First, AI and wearable, [indiscernible], especially with a multi-model AI is showing that -- is showing what our future in wearable may look like, and free, easy to use and voice activate interaction within AI based digital companion with style and comfort. In our future, we see more and more simple, light comfortable pair of good-looking glasses with a tech hut inside. We have a real opportunity to build both, our daily universe and growing Metaverse around our product. Finding new synergy and convergence with other industry and categories. One of the most highly anticipated tech products of the year is our Nuance Audio, which bring together sight and sound into one single product. Then med-tech and big data, which are closely connected. Something you may not think about is the fact that hundreds of millions of consumer interact with our brands every day and hundreds of millions of data every day help us to predict consumer trends and market needs and to develop our innovation path. Varilux XR, the new lens technology we launched last year is an example of the way Big data is improving our product. For us, this is a gateway to med-tech, we are increasingly going into software and services for the vision care space, advanced diagnostics, telemedicine and more. HELIX, our new digital division and VisionX, launching soon in North America will transform the way high care practices use modern technology to run their business. This kind of transformation is one we want to lead even beyond our industry. And to close the loop, our iconic brands loved by people everywhere in the world. We manage today more than 150 brands from eyewear to lens technology and retail banners. Our house brands together with our long-lasting licenses will support our growth in the years to come. They will be our ambassador of style and innovation to consumers everywhere. And now with this clear ambition in mind, I hand over to Paul who will give more color on our assets. Thank you.

Thank you, Francesco. Hello, and welcome to everyone. It's always a great pleasure to be with you. This event, as you've seen in our strategic vision which Francesco has just talked about, made it possible for us to carry on in 2023, the solid growth at 7% that we experienced since 2021, driven by our unique position and bold position at the intersection of multiple categories, spectacles, digital, med-tech and now hearing solutions. As you've understood, this makes EssilorLuxottica a group that is entirely unique within our sector and beyond. I wanted to share with you 6 key priorities that are the major assets for our company. Firstly, innovation. You know how much it lies at the heart of our strategy. Francesco talked to you about the 3 major initiatives in the fields of med-tech and big data that we announced to the market in 2023, which will shape our future. But at EssilorLuxottica innovation also means a high degree of inventiveness at the heart of our products and our brands. So we have continued to develop new categories, for example, managing myopia with Stellest. We launched our biggest pipeline of innovations to date with a new Varilux, the XR series based on artificial intelligence and digital twin, more recently, transitions, [indiscernible] and Ray-Ban Reverse products that are really innovative. We've also added alongside the very major marks that we are proud to have [indiscernible] other iconic brands in our portfolio in 1 year as Swarovsky, [indiscernible], Ferrari, Jimmy Choo, Moncler and in collaboration with all of those people with Roger Federer, while reviewing over the long term, specific agreements with our historic partners, such as Michael Kors and recently Dolce&Gabana. You can see a lot of dynamism in the core of the product offering and brand offering. And I wanted to mention in passing that one of the things -- one of our [indiscernible] things, we will be presenting to the -- they'll be there at the Olympic Games through all our ambassadors with a dedicated space at the [indiscernible]. Now this growth is based on deep industrial know-how that's key and which we will strengthen with significant investments we have done in recent years. In 2023, we launched 2 key industrial campuses, 1 in Thailand and the other in Mexico as well as a prescription laboratory in the Paris region, just 20 kilometers south of here, that is home to the best technologies and will be a global worldwide reference. Our strong commitment in sustainable development lies at the heart of these projects with considerable investment in our carbon footprint certification -- lead certification and optimization in all forms. Third priority, the creation of a unified company. And it's important that we've mentioned this to you. It's a huge task that we have done through all our colleagues worldwide. The integration of GrandVision continued with great efficiency in the last year and contribute to the development of the market. We have continued to unify our IT infrastructure, supply chain and cover and consolidate our teams through all over the world. And through the Leonardo platform, an initiative that is very highly innovative initiative. Our ecosystem of online training. We have created a shared culture, a platform of shared knowledge for all our [indiscernible] and players in the industry. Over 2.7 million hours of training were given last year. Let's talk now of our presence in the heart of our markets. It can be expressed now through relations with partners with 300,000 professionals -- eye care professionals, third parties who are our clients and who are supported by the full division of professional solutions that, as you'll see in the figures later, had very good progress. But in the market, we're also present with 18,000 shops in the world and 73 e-commerce platforms. And we are constantly developing them, 2 examples last year in the direct-to-consumer activity, the Chalhoub activity we created in the Gulf area and more recently, the acquisition of Washin, Megane in Japan, an important milestone to move our market of eyewear distribution in those countries. Elena and Anurag are going to tell you more about sustainable development and the progress we have made in our program, Eyes on the Planet and all the OneSight EssilorLuxottica Foundation activity. To close, our teams. You know how much the human dimension is dear to our heart, both for Francesco and myself and also all the leaders in this company. Now 3 things we need to consider and bear in mind. We have consolidated our organization around the team of outstanding leaders who are managing 200,000 coworkers who are both skilled, rich in diversity, inclusive culture and very much committed. I think about our teams in Israel and in the Ukraine, facing a very challenging situation right now. At the beginning of this year, we deployed new values, both strong and modern which represent us and to which we adhere. They are derived from the collective work conducted by 100,000 people bringing together our values and expressing them around a common culture. Finally, as Francesco already has said, we continue reinforcing our -- we've got shareholding program, thanks to your trust with 2 programs boost, trying to include as many colleagues as we can and the performance shares, which are targeting 5,000 managers based on the company's performance. 80,000 people are involved in 86 countries. This is unique. In total, 30,000 people are also members of the Valoptec Association, which speaks volumes regarding their trust in the group strategy and how committed they are. These are the main ideas I wanted to share with you to add to the strategic vision we've already shared. EssilorLuxottica is in an ideal position to continue grabbing all the opportunities and to continue on this beautiful industrial and human adventure path. I would like to give the floor to Alexander. But before that, I would like to show you a video which illustrates the beautiful community, which we have at our disposal across the world. Thank you very much for your attention. [Presentation]

Thank you very much, Francesco. Thank you, Paul. I'd like to give the floor to Stefano Grassi, who is going to speak English and share with you the annual 2023 financial results for EssilorLuxottica.

Ladies and gentlemen, good morning, ladies and gentlemen, shareholders. I'm very happy to meet you today to share with you the results that we have achieved during this record year. Our turnover has grown during this year, and we have been able to retain a strong profitability and a robust cash flow generation. Let's start with the 2023 results, and there are really 4 numbers, that better describe our 2023 results. The first number is 7.1%. That number represents our growth at constant currency for the full year 2023. The third consecutive year on which our revenue growth exceeded 7% at constant currency. The second number is represented by our profitability. 16.9% is our adjusted operating margin at constant currency, 10 basis point improvement compared to the 2022 level. The third number, EUR 2.4 billion. That is the free cash flow generation that EssilorLuxottica delivered last year, EUR 140 million more than the result that we achieved in 2022. The fourth number is represented by growth, 22%, that is the increase in our dividend per share that we are proposing today for your approval for a dividend at EUR 3.95 per share. Now let's start taking a closer look to our performance beginning with 2023 in the top line and afterwards, we'll take a closer look to our profitability. Our revenue are represented here broken down through the 4 different geographies. The white circle that you see on the slide is represented by our growth at constant currency, 7.1%. The number that you see right next to it, 3.7% represent our growth at current exchange results. The difference between constant and current and current results is represented by the devaluation that we've seen in few currencies, namely the U.S. dollar, namely the Turkish lira against euro during the course of 2023. And that's why we sit on some currency headwinds during the course of 2023. But in order for you to better appreciate and understand our underlying performance, it's important that we focus on constant currency results, the golden column that you see right in the middle of the page. North America, the biggest geography, 43% of our revenue base delivered a top line growth of 4.2%. Both professional solution B2B and direct-to-consumer delivered mid-single-digit growth during 2023. When we look at North America B2B, our growth driver was our main distribution channel with the ECP, the eye care professional that represents about 50% of a revenue base on the B2B channel. Moving to the direct-to-consumer. We have 2 polarized picture, on 1 side, strong performance of our optical retail banner, LensCrafters, Pearle Vision, Target Optical and our EyeMed insurance. While on the other side, beginning from the second quarter of last year, we started the experience of softness in the demand of Sun, in particular, on our Sunglass Hut division. Moving to Europe now, 8.2% revenue growth 11 consecutive quarter of growth in this region. We were double digit in Eastern Europe. We were double digit in Turkey. We were high single digits in Italy, in Spain, in South Africa, and we were in the mid-single-digit growth in France, in U.K. and in the Middle East. So as you can see, a very compelling picture for our EMEA region everywhere. On the Professional Solutions side, strong delivery of our lens business, strong delivery of our Sun luxury frame portfolio in the course of 2023. While when we look at our direct-to-consumer channel, I would say strong delivery on GrandVision, the integration of GrandVision that progressed at a high pace, integration on the front end of the business with assortment with new stores, front-end and back-end integration. And on the other side, we have another outstanding year of Sunglass Hut that deliver a double-digit growth in the region. The third and best performing region for the year is Asia Pacific. So we move east now. 14.3% in Asia Pacific region, double-digit every single quarter in 2023. We experienced a rebound in China after 2022 that was very challenging due to the COVID restrictions. We were double digit there. We were double digit in India, in Japan and in Korea. Our biggest assets in China, the Stellest lens for myopia, management delivered more than 1.5 million pair of lenses just in 2023, representing more than 15% of our revenue base in Greater China, a category to just a few years back, didn't even exist. Moving to the fourth region. Latin America, our top line at constant currency was just a touch below double digit, 9.9%, double digit on direct-to-consumer retail banners and high single digit on our Professional Solutions division, very much positive, I would say, across all the countries that make up this region. Now this is the breakdown by geography. In the following slide, you would see the same total, but with the division with the breakdown between 2 operating business units, the professional solution, B2B side and the direct to consumer. As you can see, both of them deliver high single-digit growth at constant currency. And I can tell you that within each of the 4 regions, both professional solution and direct-to-consumer deliver solid growth at constant and current exchange results. This is the picture for the revenue. Let me walk you through the next couple of slides, what was our profitability results for the full year 2023. This is our profit and loss. There are a variety of numbers here, but to help you to get the proper direction, I would ask you to focus on the golden column, as usual, the constant effects results, and I would ask you to focus on the 3 white circles that you see on this slide. The first one, represented by our top line, 7.1%. We already commented that before. The other 2 representing first, the operating profit adjusted growth, '23 versus '22. As you can see, it's 7.7% up, meaning that we are growing operating profit before taxes at a faster pace than our revenue, meaning that we are in the accretion territory, 10 basis points at constant currency. Good management of our operating expenses basis. And I would say good management also below the operating profit since you see that our group net profit grew in excess of 9% for the full year 2023. Tight management of our interest expense and a favorable tax rate allowed us to grow at a faster pace our net profit at constant currency. When you look at our results, the current exchange results, clearly, you have the impact of the currency headwinds, which are true for the top line and are even more so are true for a bottom line. Now, it's important that we focus on operating profit. And I think it's important to understand the underlying dynamic that we see in the operating profit between 2022 and 2023. So this slide very much represents a bridge. From the left-hand side, you have the 2022 margin rate for EssilorLuxottica, 16.8%. Then you have 3 building blocks. The first one is the inflation that hit EssilorLuxottica in 2023. Inflation is inflation mainly on labor. More than 40% of our cost base is labor. And obviously, that has an impact on our profitability when you have an inflationary environment. but we were capable, thanks to price mix, thanks to the synergy delivery derived from the integration of GrandVision into the EssilorLuxottica platform, thanks to the strong operating efficiency to more than compensate the headwinds coming from the inflation. The middle box that you see over there, 270 basis points represent the delivery of those operating efficiencies and synergies. But we didn't rest on that delivery. We also wanted to invest in the key areas that we believe are strategic for the long-term health of EssilorLuxottica. The investment on Ray-Ban Meta the diversification of our manufacturing footprint in Thailand, in France, in Mexico, the continuous investments for getting ready for the licenses that we launched in 2023, and Brunello Cucinelli, Jimmy Choo, Swarovski, Ferrari and Moncler that we're going to launch in 2024. Those investments that we call strategic investments accounts for about 50 basis points in our profitability. So you can see that our landing point for the full year 2023 is 16.9%, 10 basis points accretion compared to the 16.8% that we had in 2022. The last chapter related to currencies. As I mentioned before, currency created some headwinds in our results, in the top line, but also in our profitability. And that's why you see the 40 basis points, very much due to currency devaluation that reduced the margin from 16.9% to the 16.5% margin rate. So this is the picture for the full year 2023. Let me now give you a little snapshot on how we start 2024 and this is the revenue breakdown, very identical, I would say, break down that what you've seen before through the full region. We started the year at a solid pace. 5.5% was our revenue growth at constant currency. And this revenue growth happened on top of the toughest comparison base. Q1 2023 was the best quarter for EssilorLuxottica with revenue that grew 8.6%, so we delivered strong growth against a tough comparison base. In North America, as growth was close to 2% at constant currency. Clearly, we have a tough comparison base here in the U.S. We have the good delivery of the frame business, positive on land side. And on the direct-to-consumer, we continue to see pretty much the same trend, strong optical retail banner a bit of softness on the Sunglass Hut part. EMEA, it's another outstanding, I would say, remarkable growth of 8.5%. Further acceleration compared to the 8.2% that we commented for the full year 2023. We continue to see strong B2B and stronger direct-to-consumer in both Sun and Optical. The third region is Asia-Pacific, 8.2%. We were double digit in China, double-digit in Japan, double digit in Korea. The Optical Shanghai Fair was a great success. It's the most important optical event in China, where we have more than 1,600 guests that joined our standard at the Shanghai Fair. We launched a new collection Ray-Ban Asian fit. We had a lot of discussion around myopia with a key opinion leader fully engaged on stage. The last region is another double-digit growth story. It's Latin America. Very pleased with the performance that we are seeing over there. So if there are in a way to describe the way we want to start 2024, I would use confidence and commitment, confident commitment to deliver another outstanding year for EssilorLuxottica. Thank you.

[Interpreted] Thank you very much, Stefano. Now I'd like to hand over to Mr. Stefano Genco, Director of Super Audio and Nuance Audio. Stefano will also speak in English and will be presenting Nuance Audio. [Presentation]

Today, I'm pleased to introduce you to an audio, our disruptive technology in the space of hearing. So Nuance is a pair of eyeglasses with complete invisible solutions included in the time post. I'm wearing new one and no one will ever understand that this is a pair of glasses that is meant also for supporting my hearing. With the Nuance, we aim to solve the mild to moderate hearing loss, that, as you can see from this chart is affecting 1.2 billion people in the world out of 1.6 people that has any kind of hearing loss. If you project this data at 2050, those numbers will become 2.4 billion people, of which roughly 2 billion affected by mild-to-moderate loss. So this is the size of our opportunity. As we have seen in the video mild to moderate hearing losses that kind of hearing loss that are causing issues when people are in noising environment. So they start missing some words. They start asking, can you repeat, please? They start asking, it's too noisy here, why you are whispering and so on. Those kind of consumer that has mild to moderate hearing loss at the end, they don't have any solution available in the market because the traditional hearing solutions are meant for people with upper moderate to severe hearing loss. And there are different reasons behind this. So the first one is that because they are looking for invisibility, complete invisibility because they don't want to go around with the traditional hearing solutions because they don't want to be perceived as older than what they are. And this is, believe me, the main reason that is -- with which the traditional industry is fighting. So Nuance is clearly going in this direction. The second super important factor is the hearing noise. So technically speaking, we call this directivity, directivity activity means that, of course, you want to listen in noising environment what you see. And with our Nuance glasses, this is perfectly explained. So what you see is what you hear amplifying. There is a cone of roughly 20 degrees that is almost like a laser pointing. So if you are in a noising environment, so surrounded by any kind of noise. And you look at the eyes of someone that is close to you, you will feel amplified only the voice of the people that is talking in front of you. And when it comes to this specific super important factor that is directivity, Nuance is the best product that you can find in the market. The third important factory is comfort because wearing hearing solutions, even if you overcome the stigma is not easy, going around with something that is into your ear for all day long is not easy for anyone, even if you are just wearing let me say, AirPods. After a couple of hours, we want to get rid of it. In our case, as you can see, the solution is -- it's not just invisible, but my ears are completely free. So by the way, I will continue listening with my nuance glasses, what is in front of me, Amplified, plus I will continue hearing what is around me through my ears. And again, this is something unique. If you have a traditional hearing solutions, your ear canal is blocked. Everything comes through your hearing aids and this is something that is not natural. Best value. So in other words, pricing, the price that we will have at launch in the U.S. is going to be less than 1/4 of a pair of traditional hearing solutions in the U.S. market. And we are planning to have similar pricing points also in the other regions. Simplicity. This is another super important lever. So when it comes to traditional hearing solutions, we have to embark in different appointments with the audiologist, meaning that the first time you have to spend roughly an hour with the audiologists in a store. And then subsequently, you have to come back any given week for roughly 1 month. So if you combine all these moments that you will spend in the store, it's roughly 2.5 hours. In the case of Nuance, it's 1 single minute that will be done through 1 app. So super easy app. You put the glasses, push a button, and then the system will do what it has to do to calibrate one by one for your need in that single minute. And then size, of course, for us is super important. So we are not launching just 1 model, 1 size and 1 color, but different colors and sizes and styles at launch. So you will have 6 combinations, but this is just the beginning, meaning that in the months to come after the launch, we will have new models and new colors. So Nuance targets. If you compare Nuance with the target that is served at the moment, via the traditional industry. You see that the lady on the right side of the slide is roughly 75 years old, and she must be health conscious. Why I said that because this is the only reason to embark nowadays into the purchase of a traditional hearing solution because of the stigma, the price, the comfort, all the levers that I mentioned. In our case, we aim to serve different customers starting from a very young target. For example, the working professional that could be 50, it could be even 40. When you are exposed to noisy environment, maybe you are able to listen but you have -- you are exposed to a certain listening fatigue. With Nuance, this fatigue is not anymore there. What you see is what you hear amplified, as I said. And this is something that, believe me, if you are in a credit environment, you can enjoy even if you are 30 years old. So we aim to serve those customers and also the active senior that, let me say, should be 75 plus, so the target that is in the middle between the other 2. We are at launch in the U.S., we will start serving our customers through our retail stores. So of course, we are planning to launch in all our chains there, meaning LensCrafters, Target Optical and Pearle and at the same time, we are talking with all the biggest wholesalers in our space. I'm having a lot of meetings. We are already attending all their conventions to presenting product. And of course, we let people try the system because the most important thing at the end is to try the system and to enjoy the experience. And for the first time in our history, we are going to serve also the audiological industry. So again, we are already in contact with the top 5 players in the industry. with some of them, we are already not just talking, but planning to have at launch in their stores, Nuance because for them, it's going to be a new product and the possibility to serve that customers that again, are maybe younger or maybe are mild to moderate, and that today are not able to find any solution in a traditional hearing aid store. So this is our launch plan. We will launch it in the U.S. for the simple reason that in the U.S. There is the OTC, over-the-counter category for the hearing aids. So we will classify with the FDA. We are already in the process, our Nuance product as OTC, and subsequently, so beginning of next year, we will start. We will launch it in Europe and in the rest of the world as traditional hearing solution.Thank you.

[Interpreted] Thank you, Stefano. I'm now going to hand over to Pierluigi Longo, Director of Mergers and Acquisitions and Business Innovation. He will present the vision and strategy for the digital transformation of the visual, the eye health center, and he will also speak in English. [Presentation]

I'm very happy to be here again after 5 years. My last time at the general meeting was in '19. I had the pleasure to tell you about the details over the integration plan of EssilorLuxottica. A lot has happened since then, and thank you to the contribution of all our people and teams. Today, we are much stronger, more united and with a new organization with a unique positioning in the market. Today, I'm here to tell you more about our new innovation strategy. Since the integration, EssilorLuxottica continued to pursue the commitment to innovate our services and products in the interest of all of our customers and partners. As you heard from all my colleagues, we are fully devoted to achieve durable growth, leveraging on new technologies, embracing innovation and staying ahead of trends in all the segments of our industry, both current and future ones. This means investing in research and development, adopting cutting-edge technologies such as advanced analytics, artificial intelligence, machine learning to anticipate future demands and to bring changes and transformation to the entire market. With this in mind, we are venturing more and more in the digital solution and med tech space with the ambition of positioning the company as a relevant player in the market. Digital innovation is a key pillar and a key enabler of our group strategy. We will continue to leverage our new technologies to accelerate the pace of our innovation in the next years. As part of our strategy, we will continue to introduce innovative digital and medical tools to address the changing and various needs of our customers and partners, both in the medical and in the retail field. As you can see from the screen, amongst the various projects we are developing, our main focus is on the following transformation application. A new Teleoptometry platform, which is live already in the U.S., which has been completely developed by our teams, which allow doctors to perform medical and eye exam remotely, but with a unique and immersive patient experience. It's like having the doctors with you while it is at home or in another store. We are also developing advanced clinical diagnostic tools which can identify ahead of time, potential pathologies of the eyes based on machine learning and data analytics. This will allow doctors to refer a patient to specialists in case of the diagnosis, which are dangerous. Last but not least, we aim at completely revolutionizing the way our optical partners and doctors manage their stores. Introducing a new digital innovative and state-of-the-art IT platform that we named Vision X. Vision X integrates all the different modules and software solutions, which today are needed by doctors and used by doctors and optical retailers to run their practices. We were creating a new centralized deck, allowing them to have a simplified access to a variety of tools such as patient booking, electronic health care records, lens and frame ordering solution, practice management systems, revenue cycle management tools. For the ones knowledgeable and familiar with the eye care and vision care industry, these are critical tools for the doctors and the optical retailers to run their practice and interact with the consumer or patient. As part of this exciting journey, in 2023, we launched this new division, which we call Alex, dedicated to providing a holistic technology offer to all doctors' community and optical retailers. Alex is our innovation hub, our digital factory, our center of excellence is the new house for our talented and skilled people focused on software and med tech solution to foster creativity and collaboration between teams and people, which were located in different functions and in different geographies. With Alex, we will accelerate technology adoption in the optical market for the benefits of the doctors and of the patients. we will also improve the patient and doctor journey by merging medical and IT solutions, we will create a new software to facilitate the interaction and the interconnection of the different players and operators of the market but with an open platform approach. So everybody is invited to join and will be able to have a dialogue with the different stakeholders. This will translate for doctors, for patients, for optical shops in a higher efficiency in a higher productivity, a better medical and in-store experience and a high attention to customer and patient needs. I'm looking forward to meet you again next year to tell you more about this fantastic new chapter of EssilorLuxottica. With this, I hand it over back to Alexander. Enjoy the rest of the day.

[Interpreted] I would like to give the floor now to Elena Dimichino, who is Sustainable Development VP, and she will talk about the Eyes on the Planet program. She will speak English. [Presentation]

Good morning. It's a pleasure to be here and share with you our progress around sustainability. When in 2021, we launched our sustainability program Eyes on the Planet, we committed to addressing sustainability at each stage of EssilorLuxottica's value chain, starting from its vertically integrated business model. Eyes on the Planet, which is, in fact, our program is a matter of taking care of the environment, of territories of people, of communities fully respecting everyone everybody. And this is also the basis of the program and of its 5 pillars: carbon, Circularity, Inclusion, Ethics and World Sight. So 5 key areas that are at the core of our sustainability journey. So within the most significant accomplishments over last year, definitely, it is worth mentioning that we reached the carbon neutrality in our direct operations, direct activities in Europe, meaning Scope 1 and Scope 2 emissions, and we are setting the stage to become Scope 1 and Scope 2 carbon neutral worldwide by 2025. But how did we get there? By continuing to improve our energy efficiency in our facilities and by continuing to increase the use of renewable energy, whether it is purchased or self-produced. And actually, we have continued to increase the self-production of renewable energy at a double-digit pace, also last year. On circularity, well by continuing to our actions on Ecodesign, continue to take opportunities on the reuse and recycle -- assets. And on the wastewater management, the combination of all these factors have allowed us to improve our waste [ valorize the ] rate to 63%. Just a couple of examples to be a bit more concrete. Ecodesign. On Ecodesign, this has allowed us to avoid 1,250 tons of plastic in our lens manufacturing Varilux -- the latest Varilux XR series is a great example of this. We continued our internal opportunities to recycle scraps deriving from the frame manufacturing. And this has allowed us to internally recycle over 90 tons of scraps last year. And then we continue to increase the penetration of alternative biobased materials. I think about biobased acetate, Bio-Nylon, biocircularbio circular polycarbonate. Again, nice improvement also in the penetration of Bio-Nylon in our frames and lenses. But then you see when we enter the social dimension of Eyes on the Planet. I believe it is important to remind the role that the Leonardo platform is playing in building our inclusive learning culture inside and outside our company. 2.7 million of education hours are equal to over 43% increase last year. And this included live sessions on to celebrate Earth Day, International Womens, the World children's and a Global awareness campaign on diversity inclusion topics. And all this is coupled with the common culture that the group has built with the launch of our share value, but also with the launch of our new Cosmetics and of the business partners code of conduct. So Eyes on the Planet, as on the planet is the name of a journey and is a longer-term responsibility that belongs to all of us. As said before, we are on track to reach our 2025 carbon neutrality objective worldwide. But you see 2025 is around the corner. So what we did last year was also to commit to setting a near-term size near-term emission reduction targets according to the science-based target initiative to further reduce our emissions in line with the Paris Agreement objectives. And this will also mean that we will have to address what we call the Scope 3 emissions. How to do that, while we will have to engage our suppliers and business partners on our climate journey. So I think is about the constant, let me say, extension of the life cycle of our products, but also making our business model more and more circular. And this is coupled with these other important topic that I mentioned before, that is Ecodesign and basically the fact that we continue to shift from phosphate-based materials to bio-based materials or recycled materials and also to continue to embed eco design in our product developments by 2025. My last point is more something new that we have recently launched and the inclusion board, that actually is comprised of senior executives across different functions and geographies to provide accountability guidance and advocacy across the different diversity, equity and inclusion topics. And I'm a proud member of it. So my goal today was more to remind that every step that we take with Eyes on the Planet is the result of careful planning and investment. Each project initiatives that you see is the result of an important journey that is entailing a strong collaborative mindset across different functions and geographies worldwide, in line with our being an open company and in line with our mission of helping people see more and be more. So, thank you.

[Interpreted] I'm now going to hand over to Anurag Hans, Director of the mission and of OneSight EssilorLuxottica Foundation. Anurag who will also be speaking in English will be presenting the achievements all 2023 to contribute to eliminating poor vision uncorrected poor vision.

And hello, everyone. It is my pleasure to be here with you today to share an update on the impactful initiatives carried out by the group and the OneSight EssilorLuxottica Foundation in 2023, initiatives and actions that help us advance our mission of helping everyone everywhere, see more and be more. In 2023 alone, the group, along with its partners, provided 14 million people in underserved communities with a life-changing pair of classes. That translates to changing everything for 26 people in need every single minute, simply by giving them good vision. The scale of our activities makes us the largest foundation focused on refractive era in terms of impact and reach and 2023 was the biggest year by far of impacting our shared history. Because of our actions at the end of 2023, nearly 72 million people now have clear vision in underserved communities because they see more their lives have changed, helping them to be better students, to be more productive, to be more confident, simply put, be more in life. Nearly 28,000 optical points in rural areas have been established, providing young people in remote communities with a chance to earn a livelihood by providing vision care to their fellow community members. And at the end of 2023, our impact had been felt in 130 countries, and we are on track to expanding that to 138 countries in 2024. This kind of scale, reach and impact, combined with the experience and expertise and dedication of our teams globally, is why governments multilateral organizations, NGOs, other corporate foundations seek to partner with us. We welcome such partnerships that have helped us create unprecedented awareness of the need for Vision Care. In India, for example, we are working with state governments and localized strategies, including the integration of Vision Care into existing health care services. In India and in Africa, we are pioneering a new approach to enhance the delivery of Vision Care in remote communities through our teleconsultation model, connecting Vision Care providers in rural areas to optometrists who can be based in urban areas. We believe that our leadership in deploying such innovative approaches can substantially reduce the main barrier to Vision Care in these communities, which is a lack of technical manpower. Thanks to this and many other actions of our teams 2024, is going to be the first year when we will equip more than 1 million underserved community members in Africa in 1 year. 2023 was also our biggest year of serving underserved communities here in Europe, working with old friends like the Special Olympics the Roche Foundation here in France and new partners like the United Nations High Commissioner for Refugees or UNHCR, we equipped over 87,000 people here in Europe in need, including France and Italy. Our partnership with UNHCR will provide more than 100,000 refugees with Vision Care to the need over the next 2 years. We've already run clinics in Moldova, in Greece, in Italy, with many more to come. We also continue to advocate Provision Care at the highest level. Last year, on the sidelines of the UN General Assembly, the OneSight EssilorLuxotticaa Foundation raised the awareness for a global lack of eyeglasses and the commitment to deliver high-quality vision care senses. This and more, coupled with our global capacity, ensure that we are well positioned to help governments to take action on World Health Organization spec strategy, which was launched in 2023. And I look forward to sharing more with you in the near future. Support for our work and the foundation has never been stronger from within EssilorLuxotticaa. We are working towards a world where millions of consumers, thousands of customers, hundreds of suppliers, brands and ambassadors are all part of our story. We've seen firsthand the power of superstars like the French football icon,Kylian Mbappé. And the Indian Cricket Captain, Rohit Sharma who have joined us in our calls, where 1 social media post from these people can reach 6 million and inform them and encourage them to go and get their eyes checked. We've seen the power of thousands of our retail colleagues who take great pride in telling their customers about the work that we're doing and asking them to join us in our efforts. And we've seen the dedication of thousands of employee volunteers who contribute their time and share their skills in what was our biggest year for voluntarism within EssilorLuxotticaa, Incredible opportunities await us in 2024. It's within our power to help the world see more and be more because we know the power of good vision, it changes everything. [Presentation]

[Interpreted] Thank you, Anurag. I'm now going to hand over to Andrea Zappia, Chairman of Nominations and Compensation Committee, who will also be speaking in English.

Ladies and gentlemen, good morning, and thank you for your attention. I'd like to take you through today the work that the Nomination and Compensation Committee has done in the past year. But first of all, like to thank also those shareholders that have been patient enough to listen to us and have given us a lot of inputs already last year that we already see they are incorporated during already this year and more to come to improve the work we did. Now last year, we really focused on trying to really continue providing this company with the support it needs to its leadership. And this is about providing the right stability while supporting, as you have seen, the high degree of innovation this company provides on which build a fantastic performance. So today, I'm going to take you through 4 key points. The first one is the compensation of 2023. The second one is about the renewal of the Board of Directors. The third one is the compensation for the key corporate officer for the period of '24 to '27. And finally, the last point is about the employee shareholding plan. So starting from the compensation of corporate officers that tackle and to go back to tackle the fifth resolution and the -- which is the commission of 2023 and the sixth and summer resolution rate specifically on the 23 compensation of the Chairman and the Deputy Executive Officer. Can we back to the previous slide please, this one. So as you can see on the screen, the compensation reflects what approved last year. It is the result also of an outstanding performance as both Francesco and Paul and Stefano highlighted earlier. 80% of the performance is related to the variable form to financial results and 20% to the 1 of corporate responsibility. The overall achievement was under 40%, reflecting this great performance. As a reminder for everyone, the CSR targets are related to CO2 reduction which was taken as an indicator as clearly recognizable one. Now let's spend a bit more time into the results achieved by the corporate officer and that are part of the -- of this compensation. Starting from the financial results. You see here the comparison result '23 to 2019. We used 2019 and on 2020 because 2020 was clearly affected by COVID. And so 2019 was a much solid and stronger base. You can see the evolution of the revenue grew from EUR 17.4 billion, EUR 25.4 billion, which is a 46% increase. The capitalization, the market cap grew by 39% and the collaborators, the employees grew to [ 203,000 ] plus 26% is an indicator of complexity of the business. Now as we do our job as a committee, we look at our peers. We created a benchmark panel of companies and we measure their growth and their compensation. So when you look at the compensation we propose, this is always benchmarked in this respect. If we look at the performance of these peers, we see that the company has overperformed and has now reached compared 46% to 27% in revenue growth and 39% to 16% in the market. But success is not only the financial results, you have heard a lot previously about this, but I think it's good to remember these 3 points. First of all, 80,000 colleagues, employees at EssilorLuxottica are active shareholders as well, which means sharing the benefits of this growth which also means more and more buy-in and support the strategies that the leadership provides. The second point, and Elena just show it is that the company reached the carbon-neutral result in 2023. And the third one is the one that we are just seeing is that 72 million people around the world by the foundation actions, are now being helped in their vision. These figures has tripled since 2018. That's for the results of 2023. Let's now move to the second point, which is the corporate governance and the Board proposal we have for you. So first of all, when -- this year, as you probably know, is the end of the cycle, the last Monday closed today. And as a committee, we have to decide how do we face the next one. So as everything we do, we started with information. So we assessed how this board has performed over these 3 years, how it's components, the skill set of the board members, and we came out to the conclusion that we're going to share very, very quickly. First of all, starting from our Board composition. 58% is made by independent providing a for good governance, a good independent view. All the committee are led by Chaired by -- sorry, just going ahead, and the percent of the chairperson of the committee are independent. 42% of the board members are women. And there are 5 different nationalities presented. On top of this, the results are director representing Valoptec, which is the employee shareholder Association and 2 directors representing the employees. So given all of this, we recommend the extension for the next 3 years for -- I will see now how we do it, of the composition of the same board members of the previous cycle. I'll now introduce all of them because each of them is related to a specific resolution. Of course, very well Francesco and Paul that have been sharing this meeting. And after them, is Romolo Bardin, which is a non-independent Director, Romulo is here in the first row, Jean-Luc Biamont, which is our leading independent director, Marie-Christine Coisne-Roquette and José Gonzalo, both independent directors; Virginie Mercier Pitr that is the no independent director representing Valoptec, Mario Notari, non-Independent Director; Swati Piramal, Independent Director as Cristina Scocchia, also Independent Director; and Nathalie von Siemens, and finally, myself, also Independent Director. Then we have Margot Bard and Sebastien Brown, who are the presenters presenting the employees whose terms will end on September 21, 2024. The group working Council will appoint to direct represent employees for a 3-year term. So while we recommend to extend all the Board members, we are also introducing a new approach with a staggered renewal approach. And this is also something that was agreed and supported by a lot of the insights we received from shareholders a year ago. Our recommendation is, therefore, that 4 board members will be extended for 3 years. And these are Francesco, Paul, Jean-Luc and Marie-Christine Coisne-Roquette Well, everybody else will be extended for 2 years. This is very important because give the chance from 2026 to have every year a minimum number of 4 Board of Directors that will come up for renewal, allowing the company to adjust the competence in the Board and supported for better the development of EssilorLuxottica. This also support having, at the same time, continuity as we said earlier, as well as the ability to inject fresh blood into the board. Now before going ahead, I also would like to mention 1 point has been raised during also our meetings with shareholders, which is the combination of the Chairman and CEO roles into 1. This decision was taken when sadly, Mr. Del Vecchio passed away, and I would like also to take the chance to really pay a tribute to Mr. Del Vecchio today. At the time, we really we don't have a choice. It was very important to provide continuity and we ask Francesco to take both responsibility on, and Francesco kindly accepted the weight of the role at the time. Over the last 18 months, we have seen his governance in action, and we are very pleased with the results, not just the financial results as you have seen but the speed that dynamism, the agility of the company in this period. And therefore, we are very confident to recommend to keep go ahead with this in this way. And we think that it's fundamental to provide the continuity and the decision-making we need going forward. So that's it for the corporate governance. We now move to the third point I want to share with you today, which is the compensation from '24 to '27. First of all, let's clarify, this is a compensation for the mandate of the 3 years. It is part of the resolution #8, #9 and #10. As for the Board of Directors, resolution under rate, the compensation remained stable for the next mandate. Resolution 9 and 10 in related to the compensation policy for the Chairman and Chief Executive Officer and the Deputy Chief Executive Officer. The committee has decided to recommend a variation in this compensation, and I'm going to take you through it now. First of all, why we do it. Francesco and Paul has led the transformation of the company in a brilliant way. I think as a Board, we have all witnessed this, supported these meetings, and the results are a proof of the outstanding work that has been done by both of them. We put together, the company put together 2 European leaders has now created a global leader that is not only becoming an become by far the undisputed leader in the eyewear market, but is now entering new segments, as you have seen today. Nuance Audio or the Ray-Ban Meta are 2 great weakness of this. Second point is of our works that we want to make sure that the interest of shareholders and the focus of management is fully aligned. And therefore, 80% of their compensation is very related to the results that is shared and expected by the shareholder. We also think that in a moment of this, which is a moment that combine continuity, as we discussed earlier, but also a point of inflection as the company steps into new categories. The ability to have the this 2 leaders going forward in the next mandate is fundamental. And so we need to have something that is appealing for them, which leads to a competitive remuneration. As I said earlier, as we said, compensation, we look at benchmarks. And we have decided to positioned the Chairman and CEO in the 75th percentile of this metric. So we are not at the super top even if honestly, when you look at the performance of the company compared to the peers, we are at the very top. But we think this is the right level that we to propose. So going to this -- having said this, now let's move to the numbers of the compensation. The fixed salary goes to $2.1 million for Francesco and EUR 1.350 million for Paul. There are variable bonus goes to 150% and 125% and the action, the performance shares is 200,000 and 45,000, respectively. We discussed about having alignment with the shareholder. I'm going to share with you now the way we will measure the variable compensation, both the yearly bonus as well as the performance shares. Now we created a set of KPIs. We try to minimize the duplication of these KPIs between short and longer term. It's a work done with my colleague at the committee clearly. And we decided to allow 40% for benefit of EPS, earnings per share, sorry, 30% to revenue growth and 30% to the operating margin. The longer-term performance instead is measured now this time with 3 KPIs rather than 1. This is, again, one of the request and a suggestion coming from our meeting with shareholders. And instead of measuring it only through the share price, we have now introduced 2 more parameters, which are the CSR, which we discussed quite a lot of the committee. You remember that in this year, the CSR targets were in the bonus. We decided to move into the long term because we think the impact of CSR metrics are more in the long term and 40% to EPS, which is the only KPI, the 1 indicator, which is duplicated, but it's also considered the most important by our shareholders. We also introduced several changes in the overall policy and this to follow again suggestions from conversation with shareholders. I will be -- sorry, -- in terms of the change we did, we introduced a clawback performance, which is particularly important. We use a prorated principal at retirement of the executives. We introduced, as you've seen before, 3 different KPIs and not on only for the share plan. And we also introduced 2 extra conditions. One is the noncompete is now subject to Board approval and the other one, which we think is important is the introduction of stricter indicators for the annual performance out of the 3-year cycle. Last point, which I am personally particularly proud of is the success of the employee salary shareholder plan. Your approval is required and other resolution to approve the co-investment plan and Resolution 32 and instead the long-term incentive plan, which is Resolution 33. That was extremely important, the long-term incentive plan align the performance of the all the leaders of the company to the 1 of the key executives and the co-investment plan is a way to share the success of the company to more and more employees in the company is committed to expand this very broadly. That's the end of my presentation, and I hope it's been clear enough and have a good day.

[Interpreted] Thank you, Andrea. And to close the list of presentations, I would like to ask our statutory auditors who join me, especially Mr. Jean-Luc Barlet is going to share with you the synthesis of their work.

[Interpreted] Ladies and gentlemen, dear shareholders, hello. I have the honor of introducing in the name of the secretary auditors [indiscernible] reports, which we prepared for you for the mixed ASM, which is meeting today. All of our reports have been made available by the company and can be found in the universal document which is submitted to the market supervisory authority and published on the EssilorLuxottica website. And I would like to summarize the reports and statements for the ordinary part of the ASM. Our audit reports regarding the accounts and the regulated conventions and the main retribution programs and our 4 special reports for the extraordinary part. Our reports on the consolidated accounts -- consolidated financial statements, and the company's financial statements. The idea is to have a reasonable insurance and our accounts are established in compliance with the accounting rules which are applicable and give a loyal image of the consolidated situation of the group at the end of the fiscal year have taken into consideration the specificities and characteristics of your group. Our audit approach has been shared with your financial management and submitted to the Audit Committee. The work has been submitted with a detailed report to the Risk Committee on February 12, 2024. And the accounts have been closed during the Board meeting, 14th of February 2024. In terms of this, we released a certification with our reserve on the individual and consolidated accounts for the fiscal year closed on 31st of December 2023. Our report on the account submits the most important items and highlight them. As you can see, the key items are the valuation of the recoverable value for the acquisition -- test of goodwill intangible assets, valuation of litigation reserves and uncertain tax position and contingent liabilities. And regarding annual accounts, the only highlight point in the order the valuation of equity investment. Our report on the accounts include for each item, a description of the risks identified and our responses thereto can be found in our reports. Regarding the specific verification required by law, we have summarized on this page, the nature and extent of our verifications. And all of our conclusions can be found in the table which is shown on the screen. We now don't have no matters to report and no observations to make following these observations. Regarding our special report on related party agreements. We inform you that a [indiscernible] contract has been signed with Covivio S.A., a service contract, which was authorized by your Board, which met on 15th of May 2023. And the idea is for Covivio S.A. to provide assistance in managing EssilorLuxottica Real Estate assays. This contract has been authorized by your Board of Directors on May 15, resolution #4. We also have a single agreement, which has already been approved in prior years and which has been pursued during the last year. I am referring to a noncompete agreement concluded on -- between your company and Mr. Francesco Milleri. We also have released a certificate regarding the total amount of the retributions and remuneration paid to the highest paid employees. And finally, regarding the extraordinary part, we have released 4 reports, Resolutions 25 to 33, the report regarding authorizations or the additions required by your Board for securities operations does not need a special report the conditions in which the resolutions 26 and 31 are not fixed. And therefore, we have no observations. The resolutions are likely in the future to have an influence on your company's equity. We will, therefore, write additional reports when these authorizations will be used by your Board. Ladies and gentlemen, this is the end of my presentation regarding our report, and I thank you for your attention.

Thank you to our Jean-Luc and thank you to our statutory auditors for their work in 2023. We now move on to the Q&A session. [Operator Instructions] I would like to draw your attention to the fact that we received a number of written questions before the ASM meeting. The Board of Directors has approved the answers provided to those written questions and the answers have been posted yesterday on the company's website, and so that we have more time for exchanges with the shareholders present today. We will not read the questions and answers posted on the website. Therefore, we can start asking for the audience whether they have any questions. We will take 5 questions before we answer in order to organize ourselves in a more efficient way so that more people will be able to ask questions. So please limit yourself to one question so that everybody gets a chance to ask questions. Please note that the questions being asked should be relative to the agenda of today's ASM so that more people will be able to talk. So please ask your questions in a very short and precise way. When you ask a question, please introduce yourselves.

[Interpreted] In the room we have [ Dennis ] who will circulate the microphones. So please wait for a microphone before you ask a question. Are there any questions from the audience?

[Interpreted] I'm an individual shareholder. I had a question and an observation to begin with. You have shown products which are relatively high deck. Ribbon store is nuanced. And I believe that -- I mean, my observation is following. You succeeded with other players failed in the field of technology. And I believe you have not sufficiently publicized that you won an award in the Las Vegas meeting. You impressed [indiscernible] who's been organizing the Las Vegas trade fair, and you have been acknowledged by him. So congratulations. But my question is the following. How do you think of improving the autonomy of your eyewear, so that the eyewear can be used for longer, I'm talking about batteries and energy consumption. How can you make sure that you will be able to -- people will be able to use this technology for longer?

[Interpreted] I'm a shareholder since the 1990s. It's a pleasure to be here with you in this room, which is the best in those we've chosen in the past. I have 4 very quick questions. First of all, congratulations for the solid results of 2023. In 2024, growth, can it be double digit? Or will it be double digit only through acquisitions? Second question, I'd like to ask, is there still an interest in Marcolina. We saw from the values that they were in favor, but perhaps this is too much. And then the third question. So the profit, we've saved EUR 42 million in shares -- EUR 142 million. What is this saving due to? This was the gross profit. Last question. I'm very happy to see that all the members Board have been reconfirmed to top profile people. I would have seen all 12, all of them are here present today. Apparently, someone is missing. This is just you understand who has to remain 3 years and now has to remain for 2 years. And the last proposal, a few years ago, the Fiat Chrysler Stellantis Group did a spin-off of Ferrari, and it was listed separately. Now Ferrari is worth EUR 76 million in market cap capitalization compared to EUR 69.7 million of Stellantis, it's more than the former holding company. So the Ferrari of EssilorLuxottica probably is Ray-Ban. Would it be plausible to think of a spin-off of Ray-Ban, listing it directly? Or is this science fiction in the financial field. Congratulations for your work and always inspiring ourselves to the principal values and vision of Mr. Del Vecchio.

[Interpreted] Yes. I just point to the Secretary of the meeting. The complication I think is extremely sober on the brocher. I think you could add some colors and some information and not just cite the universal registration document. Now here's my question. With regard to the share buyback, there is a project that's been underway in France to tax. These drop build to tax these buybacks. What is the position of EssilorLuxottica on this matter? May this lead to a reduction in these buybacks? A final point, have you in France and perhaps in other countries in Europe, it is difficult to have -- get an appointment with an ophthalmologist. The profession is less well staffed than before, unfortunately, as in other sectors -- medical sectors, do you think that the company is considering to act to encourage the studies of ophthalmology and to promote students in this field.

[Interpreted] I can see at the bottom of the end of the room. Microphone 3.

[Interpreted] My congratulations for Nuance. So I'd like to know if it's already available. Can it be connected to a telephone into account? And what's the real saving when you have extensive corrections to dilute both for vision and for hearing?

[Interpreted] Thank you. An additional question from microphone number 4.

[Interpreted] I am [indiscernible], I left EssilorLuxottica, I returned from it a few months. I have a question concerning the Instruments division, which is particularly sensitive to this division because I spent 50 years of my life in it, and I'd like to know what future you have installed for this division?

[Interpreted] Let's move on to the answers now. I tried translation that is looking at. So first, thanks for the congratulations. We are very proud to our new product, Nuance. It was really a big challenge that has really started 2 years ago. So in a very short term, we are bringing to the market a brand-new product. And thanks also for remind us the CS success and the Capital Health presentation. We have Senator from U.S. very really enthusiastic and proud that we are taking care to another problem that in U.S., but around the world is really strong and difficult to correct. And our company, we would like to take the same commitment that we took on the vision also on the audiological part because there are a lot of people around the world they cannot really afford traditional hearing aids and they cannot correct and that bring people really to remain isolated and start very early really to the generative -- neurodegenerative pathology because of the disease relief. So we are very proud of that. Is something that we have to improve. As usual is our first product. It will be available in U.S. in -- at the end of the year and after September, October and then I -- will be available in Europe in the next year. We are quite satisfied about performance of battery, amplifier speakers and also the algorithm that we have. And as you know, is coming from research center that we have in Israel. And the company the Nuance that we acquired and we integrated in our company. So, of course, in 1 year or 6 months, maybe we will come out with a second release as you noticed, for Ray-Ban meta, the second one is much better than the first one. I believe we learned a lot during the process of building together with the Meta company, we learn a lot about integration of technology, electronics into the eyewear. And so that experience help us to start from the beginning with a very good and performing product. So we believe that Nuance will be a success. But at the same time, we have the teams are working on the next product, next generation of product and also to really expand our portfolio of product on the hearing aids. Thank you.

So I'll take the 2 questions. I guess 1 related to the tax rate. And there was another question related to the share buyback. so when we look at our tax rate on a reported basis, the benefit that we got in 2023 is related to release of a provision that was set due to litigation and discussion with the French tax authority. As we reach a settlement, in 2023, we released the excess of that provision to the profit and loss and created the benefit. Well, when we look at our tax rate on an adjusted basis, you compare the 2023 level with a pre-COVID of 2019, for example, the tax rate is broadly aligned. The other question related to buyback. I think right now we observe and read the debate that it's happening in France. We're not in a position to evaluate the impact. However, I think it's important to highlight that the buyback program that we're putting in place it's dedicated to employee shareholders. And that's important because I think there will be probably distinctions between the purpose of the shares buyback program to preserve the companies that put in place those program to grant shares to the employees.

Spin-off. So far, we didn't really think about that. We have been heritage to put all together, to grow altogether. All the pieces are a part of a big puzzle that can work if they stay together and tight. I don't see in the short term a spin-off of some of our brands because as you can see, we use technology, brand and platform in a really integrated way. It's not the case of maximize financial results but building a real solid long-term company for all the stakeholders, but who knows. About -- I don't want to comment on marketing because it's ongoing. And so we have been part of the discussion. So we will see what happened about that is not really a strategic part for us. As you understood, we love a lot our origin based on frame and lenses, but the company now is taking a slightly different direction. And already, we have on frame and brands, close to 31 different brands, that cover almost all the segments. But at the same time, I would like to reinsure all our shareholders that we are really focused on the M&A, and I hope we will show to the market that our activity, it will be strong and fast in the here to come.

Yes, I can take the instrument question. Clearly, the instrument division of EssilorLuxottica is a key asset of the company that we plan to expand into, to invest into through internal development and potentially through a buildup to combine the net take strategy of the group and connect that with what also Pierluigi Longo explained earlier of creating platform, starting from the eye exam for the full vision care journey of the consumer. So clearly, the instrument division is part of the future and a key asset we want to invest in. I can connect also to the question on the ophthalmologist. Yes, this is [indiscernible] or that we support that we think we should invest in and that is part of this vision care need that is becoming more and more [Foreign Language]. [Interpreted] My apologies. I have actually started off in English, and I'm going to move into French now. So the whole issue of ophthalmologists, clearly, it's a field in which the group [indiscernible] support, which we -- there should be studies that should be bolstered to consolidate this part of mission, which is very important in the consumer journey. I wanted to go back to a quick point that was very important that Stefano mentioned, in the share buybacks. In the position of the group, we don't know as clearly Stefano said, if there are any draft bills or not. But the purpose of the share buyback at EssilorLuxottica is to help employee shareholders. And quite clearly, our position is that this part of the share buyback should be protected to continue to support what works really well in France. The development of employee shareholders. So our position is very clear. If we have to have one.

More members are here showing very high consideration. I really -- I ask all the Board members to stand up and sure to everybody. So... And really, I have to thank all our Board members for their support. Most of the results depend on their support and the capability really to take the right decision in the right time. That is so important, and this is why we really altogether, we supported the renewal of this board. I don't know, sometimes in the future, we will force to replace someone of them, and they will be very tough and hard to find someone at the same level of the Board members that we have now.

[Interpreted] We still have a bit of time if there are any other questions. I can see one from the floor over there, number one.

[indiscernible] I am a shareholder. First of all, congratulations to all the Board and I took note of the Board that is very composite, and I paid more attention to the Board when I realized that there is a part of the Board, which is going to last for 3 years and part of the Board, which is going to last 2 years. And Mr. Zappia gave some explanations related to the -- to the corporate governance. Still, I have some doubts because I'm wondering what is -- if you're thinking even that the Board is performing, what is your succession plan since you have part of the Board just lasting another part, which is not lasting. So what is your succession plan if you have meetings related to the succession plan of this new entity, which is an integrated entity. So another point related to the articles of incorporation, and the right that the maximum age for the President is 95, okay? So a person who is 95 according to the statistics is not plays for a president, which is plays an active role. So which is more of a representative President, which might well be. But in this very moment, we have active presidents. So there is one question related to the corporate governance. The second question is related to Meta and Ray-Ban. First of all, congratulations for the fact that you proceeded very fast in the direction of high-tech glasses, okay? Still, I see that the Meta, the name itself, is considered as a brand because, as you know, in this industry, in the eyewear industry, people by brands besides technology, they buy a frame because also there are brands. And I have to say, I must confess that maybe the Meta brand has not been very lucky in the past few years. I just put on the side the fact that they changed the name from Facebook into Meta, but they did it for a rationale into the metaverse. But just recently, also the visibility that they have in the financial markets is not beneficiary for the Ray-Ban brand. This is my point of view, needless to say that you just need to walk into an electronic stores in the United States and see how the Meta Ray-Ban is exposed compared to the way the Ray-Ban brand is exposed in own stores or just independent stores.

[Interpreted] Number 4.

[Interpreted] Yes, Mark [indiscernible], an individual shareholder. I have a question, which is, will your hearing aids are going to be covered by the health system, the National Health System and what's the extent of that coverage?

[Interpreted] I think there's another question. No? Number 3, over there.

Sorry, I didn't hear whether somebody actually answered concerning Nuance in English. Would it be possible for you to answer in Italian because I would definitely understand much better your Italian compared to your English, I do apologize the same. And I'm wondering whether you actually need someone to test this new equipment. I'm willing to actually test it for you, if you wish.

[Interpreted] I think we've got all the questions and we can start answering, about staggering. With regard to staggering, the fact that the terms will be will be different within the Board. It's actually recommended and this is why we are going to apply this system to comply with the recommendations. We did not comply with it for a few years for the purpose of integrating everybody. But now we're going back to this staggering system in such a way that we will ensure there is continuity in the Board evolution. There is an appointment committee, and it will be in charge of identifying the best candidate and making sure that the Board will be replaced in a progressive manner in such a way that there will be complementary to between the Board members. As I speak, 4 people will be appointed for 3 years. Mr. Milleri, Mr. du Saillant, Mr. Biamonti and Mrs. Coisne-Roquette will be appointed as directors. And the other directors will be appointed for 2 years. And in 2 years, there will be more appointments in a staggered way so that in 2027, we can renew every year, 1/3 of the directors.

Ray-Ban versus Meta is a good one, but I have a very simple answer. We are very complementary. I agree that is at the end any technology has to be very easy to use and people has to have confidence with the device that is using. So our approach from the beginning, it was not so easy to explain to Meta, that first has to be a beautiful frame, a beautiful eyewear to be a successful one. And technology has really to be hide inside. Less you see better it is. And technology has to be so powerful to be useful with no very big effort. So now we are splitting the role in a clear way. We are taking care to distribute the Ray-Ban Meta in the future, many other products that will incorporate technology in eyewear through the optical channel with the capability really to take to get -- together the medical part and the super power that now are in our product. But at the same time, we have to recognize that Meta is a wonderful partner. It's a partner that has a very clear long-term vision. It was one of the only entrepreneur that in the last decade, create a totally new world that it did not exist before. Half of our life now is based on social, and that is something so important for us because we believe that our product, our Ray-Ban Meta tomorrow, maybe our new product, they will be really a gateway between our real life and our metaverse or social life. They will bring the 2 things together. And Mark Zuckerberg as entrepreneur, you really gave to us the right vision years ago. So what we achieved now is we are proud of that. Style is our side, but we learn a lot on technology, and we learn a lot how to reach the customer and support the customer to social devices and social part of their life. Thank you.

[Interpreted] There was also a question on Nuance. On the reimbursement of the hearing aids. Regarding the vision part of Nuance Audio because you understand now it is a normal set of frames with prescription glasses. And now in every single country, obviously, the health insurance will reimburse the eyewear in a different way. And for the audio part, we're going to have to work with the insurance companies to determine how the audio and -- the hearing aid part will be reimbursed and covered by the local insurance. There was a question we should have applied in Italian. I'm sorry, but we've actually lost the habit of replying in Italian. We really, really use Italian in our company. But we willingly will reply, and we take note of your availability to test our products. So thank you.

[Interpreted] Thank you so much. Without -- we'll close the Q&A session, and we will move on to the resolution. Vote. [Voting]

[Interpreted] The final quorum is 83.23%. I suggest we do not read again the resolutions because they have been posted on the company's website and also sent to the shareholders who registered and all the shareholders who requested to obtain the resolutions. A slide summarizing the resolutions will be shown and you will be able to vote with the device that has been handed to you at the beginning the session. The video, which we will see now will explain to you how it works. Please ask the attendants who are present in the room if you have any questions regarding the devices and how they work, how they operate? Ladies and gentlemen, dear shareholders, the device that you were given is personal. The number of voting rights which you hold or representing is downloaded into the device. So all you need to do is push the green, yellow or red. Please. Green is a 4 vote, yellow is abstention and 3 is against, when you're voting against the resolution. After every resolution is read or mentioned, you will be able to vote and you will hear the vote is open. And you will see on the screen of your device a rectangle that will show you the progression bar and how many seconds you have available to vote. When the progression bar reaches the far right end, you will find the vote is closed on the device. And therefore, you will not be able to vote. The results will be displayed on the screen a few seconds after voting is closed. One last information. Please switch off your mobile phones during the entire voting session, and please not forget to give back the devices when you leave the room. For legal and technical reasons, I am kindly asking you not to leave the room during the voting session. Resolution #1, approval of accounts of the fiscal year closed on 21st of December 2023. [Voting]

[Interpreted] Voting closed. Resolution adopted 99.71%. Second resolution, approval of consolidated financial statements for the fiscal year 2023. [Voting]

[Interpreted] The vote is open. Thanks, guys. Resolution is adopted, 99.90%. Resolution #3, allocation of earnings and setting of the dividend. As was we reminded by Stefano Grassi, EUR 3.95 per ordinary share is proposed. The dividend update on June 3, 2023. [Voting]

[Interpreted] Voting is closed. Resolution adopted 99.26%. Fourth resolution. Agreements falling within the scope of Articles L.225-38 and subsequent of the French Commercial Code. Vote is open. [Voting]

[Interpreted] Votes closed. Resolution is approved 96.77%. Fifth resolution. Approval of the information relating to the compensation of executive corporate officers referred to in Article L.22-10-9 I of the French Commercial Code. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 92.64%. Resolution #6, approval of the fixed, variable and exceptional components comprising the total compensation and benefits in kind, paid in or awarded in respect of the year ended December 31, 2023, to Francesco Milleri, Chairman and Chief Executive Officer. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution is approved 86.13%. Resolution #7, Approval of variable and exceptional components comprising the total compensation and benefits in kind paid in or awarded in respect of the year ended December 31, 2023 to Paul du Saillant, Deputy Chief Executive Officer. Voting is open. [Voting]

[Interpreted] Voting is closed. 88.81% Resolution is adopted. Resolution #8, Approval of the compensation policy applicable to the members of the Board of Directors. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution is approved, 99.29%. Resolution #9, Approval of the compensation policy applicable to the Chairman and Chief Executive Officer. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 72.68%. Resolution #10, Approval of the compensation policy applicable to the Deputy Chief Executive Officer. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution is approved 75.32% . Resolution #11, Appointment of Francesco Milleri as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 82.96%. Resolution #12, Appointment of Paul du Saillant as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 98.01%. Resolution #13, Appointment of Mr. Romolo Bardin as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 88.73%. Resolution #14, Appointment of Mr. Jean-Luc Biamonti as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 91.31%. Resolution #15, Appointment of Mrs. Marie-Christine Coisne-Roquette as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 99.73%. Resolution #16, Appointment of Jose Gonzalo as Director. Voting is open. [Voting]

[Interpreted] Voting is closed, resolution approved 97.2%. Resolution #17, Appointment of f Virginie Mercier Pitre as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution is approved 98.26%. Resolution #18, Appointment of Mario Notari as Director. You may vote. [Voting]

[Interpreted] Voting is closed. Resolution approved 98.43%. Resolution #19, Appointment of Mrs. Swati Piramal as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution 92.26%. Resolution #20, Appointment of Cristina Scocchia as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution approved 99.28%. Resolution #21, Appointment of Nathalie von Siemens as Director. Voting is open. [Voting]

[Interpreted] Voting is closed, 98.68% in favor. Resolution #22, Appointment of Andrea Zappia as Director. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution is approved 88.31%. Resolution #23, Appointment of PricewaterhouseCoopers audit as statutory auditor in charge of certifying the sustainability information. [Voting]

[Interpreted] Voting is closed. Resolution approved 98.6%. 24th resolution, Authorization to be granted to the Board of Directors to proceed with the purchase of the company's own ordinary shares. You may vote. [Voting]

[Interpreted] Voting is closed. Resolution approved 99.05%. Resolution #25, Authorization to be granted to the Board of Directors to reduce the share capital by canceling company treasury shares. Voting is open. [Voting]

[Interpreted] Voting is closed, Resolution approved 99.65%. Resolution #26, Delegation of authority to be granted to the Board of Directors to issue, by means of public offerings other than those referred to in paragraph 1 of Article L.411-2 of the French Monetary and Financial Code, ordinary shares and/or equity securities giving access to other equity securities or that confer rights to the allocation of debt securities, and/or securities giving access to equity securities to be issued, without preferential subscription rights but with the option of granting a priority right. The vote is open. [Voting]

[Interpreted] Voting Closed. Resolution adopted 97.66%. Resolution #27, Delegation of authority to be granted to the Board of Directors to issue ordinary shares and/or securities giving access to other equity securities or that confer rights to the allocation of debt securities, and/or securities giving access to equity securities to be issued, without preferential subscription rights, by means of public offering referred to in paragraph 1 of Article L.411-2 of the French Monetary and Financial Code, i.e., through a private placement to qualified investors or a restricted circle of investors. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution adopted 96.42%. Resolution #28, Delegation of authority to be granted to the Board of Directors to raise the number of securities to be issued in connection with capital increases, either with or without preferential subscription rights for shareholders, voting is open. [Voting]

[Interpreted] Voting is closed. Resolution adopted 96.48%. Resolution #29, Delegation of authority to be granted to the Board of Directors to issue up to a maximum of 5% of the share capital. Ordinary shares or equity securities giving access to other equity securities of the company or that confer rights to the allocation of debt securities in consideration for the contributions in kind to the company of equity securities and/or securities giving access to equity securities to be issued granted to the company. Voting is open. [Voting]

[Interpreted] Voting is closed. 98.62%, the resolution is approved. Resolution #30, Delegation of authority to be granted to the Board of Directors to issue ordinary shares and/or equity securities giving access to other equity securities or that confer a right to the allocation of debt securities and/or securities giving access to equity securities to be issued in consideration for security tendered to any public exchange offer initiated by the company. Voting is open. [Voting]

[Interpreted] Voting is closed, 99.09% resolution is adopted. The 31st Resolution, Determination of the overall limit for capital increases to be carried out immediately or at a future date pursuant to delegations of authority. Voting is open. [Voting]

Voting is closed. Resolution adopted 99.54%. Resolution #32, Delegation of authority granted to the Board of Directors for the purpose of deciding capital increases reserved for members of the company savings plan in French Plans d’Epargne d’Entreprise without preferential subscription rights. Voting is open. [Voting]

[Interpreted] Voting is closed. Resolution adopted 99.67%. Resolution #33, Authorization to be granted to the Board of Directors to proceed with the award of free existing shares, also called performance shares – to the benefit of members of the employed staff and/or executive officers, corporate officers. Voting is open. [Voting]

[Interpreted] Voting is closed, Resolution adopted 96.10%. Resolution #34, Powers to carry out formalities. Voting is open. [Voting]

Voting is closed, Resolution adopted 99.99%. This was the last resolution, and I would like to thank and congratulate the Board of Directors who have just recently been appointed. Thank you very much. We can now close the ASM. Thank you very much for attending. Have a very nice day. Goodbye. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]