L'Oréal S.A. (OR) Earnings Call Transcript & Summary

Good morning, everybody, and thank you for joining us, and welcome to this session with the L'Oreal management. We're very pleased to welcome Nicolas Hieronimus, Group CEO and Christophe Babule, Group CFO. We'll have a presentation and then move on to some Q&A afterwards. But thank you very much, gentlemen. Please come and join us on the platform. Thank you.

Thank you very much for your welcome and good morning to everyone. I must say it's pretty exciting to have at last a conference where we are all present in the flesh. So nice meeting you all. And I'm very happy to share with you some news on L'Oreal, but as L'Oreal is about beauty and beauty is often about beautiful images. I'd like to start with a short presentation of L'Oreal. [Presentation]

Here you are with a glimpse of what L'Oreal is. Just a reminder of a few numbers. We are the world leader in beauty with EUR 32 billion in sales, around EUR 5 billion in profit. We sell around 6.5 billion products in the world, have 85,000-plus employees and had at the end of December, EUR 232 billion market cap. It's a bit -- it's lower today and which makes probably -- it's a good entry point. A few other elements on L'Oreal, first of all, the performance of the company has been really stellar over the last 10 years. Our sales have multiplied by 1.6 and our profit by 1.9. And we are a business, which I think is very important to understand, made of 4 separate divisions, 2 major ones, L'Oreal Luxe, which -- and that was the event of 2021 has become the #1 division of L'Oreal Group, which was far from being the case back in the days. The Consumer Products division, which is around the same size. And then we have 2 other, I would say, smaller but very powerful growth engines with our Active Cosmetics division, Dermatology Beauty division and our Professional Products division. We'll talk about that later, but that makes us a pretty balanced business, which is kind of important in today's very VUCA world. As far as L'Oreal's personality, it was created by a chemist. So we are definitely an innovation-driven company with 4,000 researchers. We spent over EUR 1 billion every year in research and more than 3% of our annual sales. We're also a digital-first company. If this thing wants to work. Thank you. Digital-first company with e-commerce representing at the end of 2021 29% our sales growing plus 26%. And of course, that continues to develop even though this year is marked by the rebound of brick-and-mortar. Finally, we are a group, I'm sorry, but this machine is a bit reluctant. The strength of the L'Oreal P&L model is that it's a very accretive P&L model. We -- our focus is top line growth, always has been, always will be. And because we have a very high gross margin over 73% and that we can control our SG&A pretty well and they've gone down as a percentage over the last couple of years regularly, we can both reinvest very strongly behind our brands and fuel that top line growth over and over again and at the same time, deliver regular profit increase as it has been proven over the last couple of years. In -- sorry, if somebody can do something about this, that would be nice. We had a very long track record of overperformance of -- thank you because my thumb is getting pretty fit now. Thank you very much. We've had a very long track record of overperformance of the market, which has accelerated about over the last couple of years. 2019, obviously, 2020, where we showed the first ever when beauty was negative. We had a double -- we did a twice the performance of the market, which was repeated again in 2021,and close enough in the first quarter of this year where we again had a very good performance with a first quarter at 13.5% on the market at plus 8%, which is very important news is the fact that the market is very dynamic. And as you will see, it will remains very dynamic. So our first quarter consolidated net sales were plus 13.5%. And what's interesting is that we are benefiting this year, not -- it hasn't always been the case from very favorable exchange rates which leads us to have a reported a published growth of plus 19%. As far as profit, the company has been regularly improving its profit year after year. We have kind of an average improve of 30 basis points. We are at 19.1% in 2021, so a 50 basis point increase. But in 2020, we managed to keep our profits stable despite the COVID crisis, which showed the resilience of the company. And of course, we will continue to contribute to our shareholder satisfaction by regularly improving the profit of L'Oreal. But talking about shareholders. You also have to talk about the dividend. Again, we've had a very dynamic dividend policy. EUR 4.80 in 2021, with, of course, a loyalty bonus as plus 10%, an increase of dividend of plus 20%. And again, L'Oreal has a clear desire to continue to improve progressively and regularly its dividend. So all in all, as you can see, L'Oreal is a healthy leader contributing to the satisfaction of its shareholders. But I guess you knew that coming here. And if you're here probably your questions about -- are more about the worries about of the moment than about the health of L'Oreal. So I'm going to try to give you in this presentation answers, which -- and you probably have more questions from the room, 2, 3 short-term worries that have other questions I'm getting every time I meet analysts. It's the first one is, is there a consumption slowdown? The second one is what about China? And the third one, which is kind of related to the first one is, what about inflation? Well, I will tell you in a minute that on the 3 items, even though we have to acknowledge that the world has gotten more complicated and is more difficult, we are very confident, very resilient and have positive news on all 3 fronts. If I start with the consumption slowdown, I have to say, and you've probably heard it from the Estée Lauder presentation earlier this morning, and I guess you'll hear it also from Coty later. Beauty is always growing. It's been proven over the year. Actually, it's been 1 year in the history of beauty when the market has been slowing down. It's not because people didn't want to buy beauties just because they couldn't access beauty because stores were closed and they were locked down in their homes. So that was the year 2020. But if you look at the perspective of the beauty market, it's an ever-growing category because beauty is an ideal that you can never achieve. You can always look better and consumers, male and female, are always wanting to look better and to feel better about themselves, which is why this market continues to grow. And it's proven today, again, our estimation, because it's very hard to assess the market with latest panels. But our assessment is that at the end of May, despite the lockdowns in China, the beauty market continues to grow at around 7%. So all channels included, which is very positive, and it's higher than most of the years prior to 2019. So that's part of a rebound. There's also a very clear phenomenon is that people want to enjoy themselves. And you see it in the growth of categories. All categories are growing. Skin care, which is, I would say, the most serious category that has benefited a lot from COVID continues to be positive. So is hair care. But the 2 most dynamic categories, what I would call the socializing categories. Fragrance continues to be stellar at around 20%. And makeup at plus 10%, growing which is already on the bounce back of 2021. And in reality, when you talk about the social categories, there is something you've heard also about, which we call the lipstick index, which was something that was elaborated upon a few years ago that says when times are tough, women tend to consume more of these indulgence categories that make them feel better, that give them affordable pleasures. It's true for fragrance and it's true for lipstick. And I put you here recent sellout data of the lipstick market at the end of April in different markets, and the numbers are just astounding. Of course, it's helped by the fact that masks are being removed and suddenly women can show off their lips. But beyond that, there is this desire to socialize after 2 years of lockdown and to have these little pleasures that makeup provide. So this is really what beauty is about. And you see it globally coming. It's something we talked about at L'Oreal at the end of 2020. Actually, it's taken a bit longer because COVID has remained a bit longer but we think that time has come for the roaring 20s. We don't know how long it's going to last. But clearly, there's an appetite for celebration, for partying, for enjoying yourself. And that's also what consumers say. This is a research that's been done recently that as consumer in different countries, whether they will want to buy more or less of either skin care, hair care, makeup and fragrances and aside from a few countries, and China, this question was asked during the lockdown, so it's probably a bit more negative. But overall, the picture is pretty positive, and you see that consumers want to consume beauty in a way that's more important than they did before. So that's question number one. Question number 2 is what about China. China is very important for the beauty market. It is going to become the #1 beauty market in the world in the decades to come. And of course, it's a market that's very important for L'Oreal. We are the arch leader of this market. We have around 17% market share, probably 30% in luxury. And there were many questions about the impact of this lockdowns. And clearly, with the lockdown of Shanghai that had an impact on our business and on everybody else's business. But in the end, we managed. We managed to go through, first of all, because e-commerce is more than 50% of our business in China. And in many places, you could still buy online and because our teams there are doing great. First quarter -- you know it was a plus 13% for us in China. But what's more important to you is what's happening now. And today, we are not only seeing the reopening of China, but we are continuously beating that market. May, which was a month where Shanghai was still under lockdown, but we saw the market coming back online, in particular, as I was telling you. And on the market, online market that was at plus 5% in May, L'Oreal in sell-through managed to have a plus 30% growth, which is through events that were like the 520 an event that was not initially a beauty event, but which we managed to animate around our brands, a few other brand events. And right now, we are in the middle of the famous 6.18 moment, which is a big beauty consumption for the Beauty market in general. And I can tell you that our teams there are very bullish. The first numbers are positive, very positive. Our brands, L'Oreal and Lancome are in the top 3. Stylenanda from our Korean brand is #1 makeup brand, YSL in #2 in the early days of 6.18. So a lot of enthusiasm. So yes, it's been tough. April was really stopped. May picked up. In June, we see a pretty good dynamics in going ahead. And we remain, therefore, confident that we will be growing despite our size in China, that the market will be growing to like mid-single digit and that we should grow high single digit and maybe above in China because we have the brands that are really loved by the Chinese consumers. The third worry was about inflation. So yes, inflation has an impact. It impacts more our mass market than our luxury market, but we have pressure on cost like any industry. But the great thing about beauty is that it can be valorized. If I looked at our Q1 results, the plus 13.5%, it was 1/3 volume and 2/3 valorization. And that came through both price increases that we have put through on our products. Revenue growth management, mix management, gross-to-net renegotiations with our retailers. But overall, you see that we can both valorize and continue to have a growth in volume, which is very important because that's the number of consumers that we do recruit with our brands. And I gave an example of hair care, but in every category, beauty is valorizing. We do it through our innovations. Of course, all our innovations are accretive. We saw that this tough time was coming. So the brief that our teams have is that any launch, any new products and new products account from probably around 15% on a given year of our business. And if you add the ones of the year before, you're closer to 20%. But they're all accretive. And all the launch plan we have for this year, just put here a few examples are definitely going to be bringing value to the company. So overall, I think we can manage inflation. We have -- we are managing inflation and a very important message, which is very consistent with what I was telling you about the lipstick index is that we see neither slowdown today. No trade down. And if there's a trade down ever, well, we have the mass market products that are there to cater to consumers who may need this to have more affordable products. So these were the answers to the 3 short-term worries, and I'm sure there'll be more questions from the room going ahead. And I'd like to end with maybe 5 reasons for long-term success, aside from everything that I've already said about L'Oreal, which is why this company, which I'm very proud to head is going to continue to grow and develop both its sales and profit in a very dynamic market. The first thing is the power of innovation. We are an innovation machine. We have fantastic researchers, and I'll tell you in a minute, one of our latest transformation as it relates to science, but we will continue to bring products that stimulates consumers' appetite for beauty. Second reason, we have a fantastic portfolio of brands. If again, it can appear on the screen. Thank you. Thank you. We have a great portfolio of brands. You can see there, we have around 30 brands -- 32 brands that are international, big power brands, new little gems that are going to grow in the next years. And if I give you a few examples, we have billionaire brands. We have 8 billionaire brands so that are bigger than EUR 1 billion. Some are even billionaire in just in e-commerce like L'Oreal or Lancome. And these brands are a mix of all distribution channels or licenses for which we have very long-term contracts that are going beyond 2050. So that's very reassuring. And these brands are actually on a regular basis, outpacing the average growth of the group. We have few candidates, brands that will join this prestigious club of billionaire brands, and probably, I don't know if it's going to be this year or next year, but they are very dynamic brands like CeraVe for example, which you've heard of a lot. And we have a few gems in Luxury, in particular, like the Valentino and the Prada license. So big brand portfolio, very powerful and able to cater to the expectations and needs of every beauty consumers on the planet. The third reason for trust is our balance, which is the best vaccine in today's world, in today's VUCA world. As you can see here, the split of our activity, you can see that we have, in terms of geographies, we have a big Europe that's our biggest region, which is growing and where we have our strongest market share. It's our stronghold. We have 2 very big and powerful growth engines, which are North Asia and North America, now about the same size. And we have emerging markets, which remain quite small for L'Oreal relatively, but which are right now growing over 20% and will be a fantastic growth relay for the future. As far as divisions are concerned, I already mentioned it, so I'm not going to elaborate on it, but very balanced. And categories stronghold in skin care, which is the category with the biggest global potential. It has slowed down a bit right now because of China, but it is the category that's going to grow the most because people use skin care until a very later date, but we also are strong in other categories and are the worldwide leader in fragrances, despite this being our smallest of our 3 big categories. We are -- what's interesting is we are a very unique company because we are, at the same time, a luxury group. We are a leading luxury group. We are #2 in the luxury beauty market. We are a major FMCG player that allows us to satisfy to democratize beauty to people with lower purchasing powers. We are also, which is fantastically interesting and powerful right now, a leading dermatological beauty company with the rise of health, the quest for health consumers want these products. And it's not by chance that this division is the fastest growing of the L'Oreal businesses. And finally, we are leaders in Professional Beauty, which is where the group was bought. Finally, reason 4, we are always transforming. L'Oreal is really transforming all the time. We have 2 game-changing transformation going on, beauty tech and sustainability. We are the leading -- we are wanting to be the leading beauty tech company, and we'll be presenting many innovations at VivaTech from tomorrow and our Deputy CEO, Barbara Lavernos, is also in charge of R&I and technology. And that's very important because today, AI is making our science so much more powerful. Right now, we have AI-powered formulation tools, which allows us to reformulate all these products that we need to change either for sustainability reason or for legal reasons in a much accelerated and more efficient way. I'm talking about tech because we also have great partnerships, which have been announced with companies like Verily, Clue or BreezoMeter which allows our science to be much stronger. Finally, I will end with our sustainability transformation. We are accelerating towards green sciences. We are reformulating all our products with our petrochemicals, and we are really moving fast. We are carbon neutral and will become neutral in 2025, but already our major subsidiaries have achieved that goal. All our L'Oreal sites in the U.S.A. became carbon neutral last year and China is already -- has already tick that box. And that's a very important. L'Oreal for the future is a major commitment from our teams. We've been awarded by CDP, the AAA for the sixth consecutive year. I think we are the only company in the world to have this recognition 6 times in a row. But it does not suffice, and we know it's a long fight that we have to continue to promote. And finally, the last reason why we are very confident for the future of L'Oreal is that we have a fantastic team of very passionate, dedicated people who are winning in every country around the world. We are very proud to work for L'Oreal. We do not see the great resignation that some companies are talking about. We see a lot of engagement. And probably it's related to the fact that we have this great mission, which is to create the beauty that moves the world that makes our team very proud to work for L'Oreal. So thank you very much for listening, and now we are ready to take your questions.

Thank you very much, Nicolas, and there should be some microphones which will be coming around if people would like to ask questions. So please do put your hand up if you'd like to ask one now. Perhaps I'll kick off the Q&A session. You've obviously given there some strong figures for China for the month of May. What has been the reason, why would you put that down to your -- take your ability to take that market share? Could you maybe just dig a bit deeper into the demand side as well as the supply side? What happened on the distribution side, particularly in Shanghai through the different months? And why you've come out so strong relative to the market, please?

Well, first of all, just to clarify the numbers I showed our e-commerce numbers. Of course, the brick-and-mortar was closed in Shanghai. So the numbers on brick-and-mortar are not as positive. But overall, we had a positive month in May in China, which I'm not sure was the case for everybody. And I think it's linked to different elements. First of all, as you -- to comment on the supply side we are very spread on China. First of all, we didn't have any distribution center inside Shanghai. And beyond that, we have 3 major distribution centers and 9 other distribution centers spread across the country. So our ability to serve our consumers be it in brick-and-mortar or e-commerce consumers was intact during the lockdown of Shanghai. Second, as I said, e-commerce represents more than 50%, 55% of our business in China. And clearly, we have a very powerful team there that knows how to activate consumers and make them buy our products. And finally, I think that's probably the most important thing. Our brands are loved by the Chinese consumer. L'Oreal Paris is the #1 beauty brand in China. Lancome is the #1 luxury brand in China. And there is a real appetite both for beauty and for our brands in particular. So that allowed us to navigate through these very difficult times. In reality, it was really very difficult for our teams because they were locked down at home and have my thoughts are with them because it has been it's been a hard time. But overall, we've managed to serve our consumers. And what's even more interesting is to see that now that China is reopening with lots of constraints, QR code theft and so on and so forth. We see the early stages of 6.18 that are showing that for us and for other brands, too, by the way, that the appetite for beauty is stronger than ever in China. So long term, after these turbulences, I still -- I'm still confident that this market is going to be the #1 beauty market in the world, and we're going to work very hard to stay the #1 group and the #1 beauty market in the world.

Given the potential for perhaps more iterative, hopefully, smaller lockdowns, but the potential for this to be a little bit more iterative, do you feel comfortable with the distribution infrastructure that you have at the moment? Or do you look to make any changes to that?

Well, I think we -- I feel very confident because we've proven during what was the toughest lockdown and the most unexpected by the way, that we could not only navigate but prevail in this environment where our activities are very spread. So even our teams are spread between 2 cities. Shanghai and Suzhou, and we have -- we can -- and Guangzhou, sorry. We can also animate our business in a very agile manner. So that's one of the things that we've all learn with COVID is that you could work from home, even though it's better to have a one-to-one conversation.

[indiscernible] prior to your [indiscernible]. What implement on respective strategic directives are you pursuing on your margin relatively based [indiscernible] by a long term CEO?

On the margin?

Yes, on the margin, I'm sure [indiscernible].

Well, first of all, you're right to say that it's a story of continuity. We are on a winning team. And we have winning strategy, which we've built building together with Jean-Paul Agon for the past decade. I was deputy and I was in the Executive Committee for more than 14 years. So you should not expect big changes. So I'd like first to reiterate what we want to do is focus on growth, beat the market and regularly deliver margin -- operational -- operating profit improvements, including in 2022 despite all the content that we're talking about. Now there are, of course, areas of opportunity. There are white spaces. I was mentioning the fact that the emerging markets where parts of the world where we were below our usual market share. We have 14% market share worldwide. We're closer to 10% in this parts of the world. And that's a big opportunity that is allowed by the development of e-commerce to be very clear and honest and transparent, we struggled a bit in emerging markets to reach the deep trade because it didn't make sense economically. Today, consumers are on Shopee, on Lazada, on Mercado Libre in Latin America and certainly a huge number of consumers that we can access to through our e-commerce sites and even the virtual try-ons that we've acquired. So emerging markets are going to be a source of growth. Clearly, we've worked at rebalancing our business for many years. It's clear that China was our main growth engine, and we've really reshuffled our U.S. activity over the last 3 years. And now we are really focusing on making sure that our plane flies with 2 big engine roaring more or less at the same speed. And that's a good way to also derisk, if I may call it that way, the L'Oreal business. And clearly, we've made L'Oreal Luxury, the #1 division of the group. We know that there's a big appetite for Luxury around the world that middle classes and upper middle classes are growing, including in China, where there's going to be 300 million more people in the middle classes. So Luxury will remain a focus but to be consistent with what I said, we like to be balanced because there's always a new ascent in current. To be honest, when I look at our Dermatological Beauty Division, which is now the #3 division. It's growing over -- for the last 2 or 3 years, it's been growing between 20% and 30%. That's fantastic. And the fact that we are the only group to have this division dedicated to Dermatological Beauty makes us pretty unique and it's an incredible asset in today's world where people are very worried and focused on health.

Can I please ask to the ease the mic just for the webcast?

What long-term growth opportunities do you see in male beauty products?

I see -- I see 2 types of opportunities. First of all, you have to separate on male beauty. There's male products, and there's male consumption. And if we say that male products are going to be probably 10% of the total beauty market, it goes up to 20%, 25% if you talk about consumption because I'm pretty sure that I don't know whether you're married or not or if you -- but you may be using the same shampoo as your partner. So we -- obviously, we have brands that do sell products to men and with a clear intent without being specific. If I take fruity shampoo or even I take CeraVe cream, it's one of the most unisex products on the market. We have specific male products in fragrance, they're growing very fast and also in skin care in Asia, in particular, male skin care is a bit unique, to be honest, in the Western world, but is very powerful in China, for example, in brands like L'Oreal Paris, Men Experts or Biotherm are growing on men in Asia. And who knows, makeup for men is maybe a potential. We talk a lot about these new Gen Z much more gender fluid using multiple products. And I think this gives a lot of opportunity for other more usage of more traditionally feminine beauty products by male consumers in the years to come.

[indiscernible].

Okay. So you know what, I could answer. But as Christophe Babule has driven very fast through Paris to make it on time, I'll ask him to answer that question so that he didn't risk his life not to speak.

Thank you, Nicolas. So of course, pricing is an even more critical topic in a period of inflation. Now inflation seems to be a very new thing in Europe or in North America. But as you can imagine, when you are already in 150 countries, we've been managing inflation now for many, many years. And so we know how to tackle that because we're showing to you the spread of our growth, how much is due to volume, how much is due to valorization. And this is something, of course, that we monitor very carefully. It was, by the way, the case the same split last year. Last year, we're growing at 16%, and we had also 1/3 in volume and 2/3 on valorization. Now valorization, it's about nominal price increase. And of course, this is linked to the context that we see market by market. But we have also a very strong pricing power due to the fact that every time we put a new product on the market, through the innovation, we tend to put at the right price. And of course, that's a way to keep valorizing overall our brands. And we've been also now for 2 years, investing a lot in revenue growth management. So we have now in some of our countries, not mainly in the U.S. Very good guys able to with the help of artificial intelligence to price rightly the product. So that's a further help, and this is lifting our pricing power in those big markets.

And what we can say is that we've put our price increases at the beginning of the year, Feb, March. And the great thing is that because we have -- I would say we have some slack in our P&L, we are able to do it progressively. So we've increased prices, we've seen that there was absolutely no slowdown or impact on consumption. Actually, people seem to be trading up a bit more than down. So we can do another one in July on the relevant products. So it's a very progressive approach, and we are making sure that we keep growing our volume and our value. And of course, the fact that we have these 4 divisions allows us -- and within the division, different price points allows us to be extremely both accurate and also tactical in the way we manage our price increases. But overall, we will be able to manage this inflation in our P&L and still deliver both the support for our brands, as I showed in my virtual circle chart and the increase in profits.

There's a question at the back there.

Just staying on the same theme of inflation. Can you talk a little more about the different areas of potential inflation, perhaps on the supply chain side and transportation, things like that? And then related to that, you've been making some comments around the potential increase in prices. From a premiumization perspective, how sustainable do you think that is given the pressure that the consumer is facing more broadly?

Well, as far as in what inputs increases, we've had different areas where we were impacted. Obviously, it's impacted a bit more our consumer division and our Professional because you had oil derivatives like -- that are used in shampoos or the price of plastic. So the shampoo sellers, for example, our CPD or Professional Division, we are more impacted than Luxury, even though we had little bit of a increase in glasses, but our negotiation cloud allowed us to mitigate most of it. Actually on fragrance, it's more you saw the explosion of the market. It's plus 20, we're up to 35% in fragrance. So it's more an availability issue that we have to deal with. But again, I think our size and cloud allows us to make the most of the situation, even though it's far from being perfect. So I think it's manageable overall. And as far as valorization, the market continues to valorize and that was before inflation. And I think it will continue. Of course, what we do, and that's why Christophe was referring to the RGM, both people and machines that work on that is that we want to be very, very precise product by product, brand by brand, format by format to make sure that we never lose the consumer and that there's always an offer from the entry price points of CPD to the most -- the EUR 400 Helena Rubinstein cream that sells a lot in China. So we have this very -- sorry, widespread of prices and we make sure, again, that's the message we like to convey. We never lose a consumer. And so far, we've seen rather more market share gains and unit need growth than any showstopper on beauty.

Maybe just ask a question. You mentioned before some of the flex that you might be able to have in the A&P line. Could you maybe discuss the efficacy of your A&P line as well, the efficacy, the online spend that you have as that is also evolving in its own nature.

So Christophe, you're the guy that checks on our marketing teams spend. So maybe you want to answer that.

This is a market of offer. So it's very important to be very active in media and marketing investments. Now with the surge of digital, I can tell you that last year, when you look at our media investment, more than 70% now is purely digital. So when you have more than 70% that is purely digital, there are 2 things. First is super flexible. In countries like China, if you want to add more investment the day after, you can do it. If you feel that you need to lower your investment next week, it's easy to do. So very flexible. And second, of course, much easier to measure the return of investment. So it allows once you have a precise target to drive your investment directly to this target. And you have -- I mean we have developed all the metrics to monitor that by category, by market and it's a way to have a better return of investment on your overall spending. And that's what we do on a daily basis. Actually, in all big markets, we have people dedicated to measure those metrics and to give to all the brands. What is the right way to activate better the consumer with a certain amount of money.

And with always 2 perspectives, which I think is very important, is to measure both the -- try to measure the short-term ROI and the long-term ROI because you can always spend in banner saying, 30% off and come and buy it, and that's making short-term ROI very effective, but it's not building your brands. And as I said, I think one of our biggest assets is our incredible portfolio of brands and the power of attraction of these brands. So what -- when we measure our ROI, we also make sure that we assess as it's not the easiest thing to do. What is going to be the -- what's left to build the brand's equity for the years to come. And so that Gen Z today discovers our brand and falls in love with it the same way the mother did, and that's very, very important. So that's a strong focus of our ROI -- A&P ROI measurement teams.

Okay. Thank you very much. Well, we've come to the end of the session now. So thank you very much indeed, Nicolas, Christophe for making it. Thank you very much, indeed, for joining us today.

Thank you very much for having us.