Pernod Ricard SA (RI) Earnings Call Transcript & Summary

[Interpreted] Good afternoon to everybody, ladies, gentlemen, dear shareholders, the entire management team and the group's directors are joining me in welcoming you to this year's Pernod Ricard AGM 2022. As you will see, a certain number of words recur more frequently than others over the next 2 hours. As always, we'll be talking about performance and strategy. But more so than in previous AGMs, we'll be talking about records or symbolic thresholds that we've exceeded. This is a good way of celebrating the 90th anniversary of the brand created by my grandfather, Paul Ricard. And what we have covered -- the ground we've covered since -- thanks to the commitment of the Pernod Ricard Group's 19,000 employees. Let me take this opportunity to thank them once again and to pay tribute to them because we would not have achieved or we've achieved without them. This AGM has been convened in compliance with legal provisions and regulatory requirements in force. There have been no requests to include resolutions on our agenda. Since the publication of the notice of meeting in the -- on the 5th of October. We've drawn up an attendance sheet, which has been signed by the shareholders present and the proxy holders as provided by law. I can now declare this year's AGM open. As the Chairman of the Annual General Meeting, I propose to set up with the AGM's bureau. And I'm going to ask madam, Patricia Ricard Giron, representing the Paul Ricard's company; and Priscilla Maters representing the Bruxelles Lambert Group to act as tellers for today's meeting. I'd like to appoint Anne-Marie Poliquin, as Secretary for today's AGM. Are also present at the Central Bureau, Patricia Barbizet, who is the Senior Independent shareholder -- Senior Independent Director, I should say; and Helene de Tissot, Chief Financial Officer in-charge of IT and Operations. The statutory auditors are represented by Caroline Bruno Diaz from KPMG and [ Mark Dewalt ] from Deloitte. I haven't got the quorum by the way. Maybe somebody can hand it to me. I see that the temporary quorum is 79.21% of all shares, representing 203,538,533 shares with voting rights. How many shareholders are represented? Do we have the number? Just waiting for the correct number of shareholders represented. Well, in all events, we will give you the final quorum before we start voting on the resolutions that look later on. So the ordinary AGM has a quorum required by law. The digital version of the legal documents have been made available to the members and are available on the bureau. Instructions have been made available to the shareholders as required by law. Today's AGM is, therefore, declared validly constituted and can duly conduct the business on its agenda. I'd like to remind you that this AGM has been convened to deliberate on the resolutions mentioned on Page 42 of the Notice of Meeting, which you received when you signed in on the attendance sheet. We're now going to give you the group's management report. But before that, I'd like to underline just how important it is for us and for me, in particular, to have close relationships with you. A year ago, almost to the day, I suggested you come to visit our new head office, [ cote d Island ]. Well, I've been fortunate enough to meet a certain number of people present here today in the room. And the -- on the occasion of the first few visits, we are very keen to maintain this level of dialogue, which has always been something the group's management has been very keen on us indeed have you to shareholders, in particular, through the AGM, but also in the form of invitations that we sent out to you. The page devoted to you on our website, but also the newsletter you received are opportunities for you to be constantly informed about what's happening in the group. The members of the premium club and in fact, you'll find a desk in the hall, if you like to join the premium club, receive an invitation in December to come and visit our site, [indiscernible] we're already working on other initiatives of this type. And we'll keep you informed in the weeks and months to come. As you know, it is not a very customary in France. Public transport is disrupted. I'd like to thank the people here today for making that additional efforts to get here. To give us food for thought, we've also been keen to include shareholders following us via the website by giving them the opportunity to submit questions by e-mail. So if they haven't already submitted questions, I'd like to invite them to do so via the address, you'll see on the screen, [email protected]. We'll select a number of these questions at the time of the Q&A session, as indeed, we will be taking questions from the room here today. Okay. Down to business. I have organized this management report in 3 parts. The first is what I would call a historical year, you will soon see why. In the course of which we will remind you of everything we've achieved in terms of performance this year. The second I have called a resilient group with the winning formula. So behind this historical year, this great performance, there is a winning formula. And I'd like to tell you more about it, just to convince you as to how confident we are about the future despite the environment that is somewhat disrupted. And the third and final part is on our long-term strategy. This is a strategy which will enable us to create value over time. So how do we deal with a year that I have qualified as historical? Well, three words some of our performance over the last 3 years, record performance -- or record/better performance. Diversified performance, and I'll elaborate on that. And finally, sustainable performance that, too, I will develop in a few minutes. So concerning records. Well, we've exceeded the symbolic threshold of EUR 10 billion revenue, at EUR 10.7 billion. We've also achieved the highest level of growth, both nominal and organic in over 20 years. So you see that our revenue has grown by 17%, that's organic growth. And thanks to the currency effect, Helene will tell you more about that. We have increased our revenue by a normal 21%. Another threshold we've exceeded is the EUR 3 billion mark in recurring operating income. This too is a record in terms of organic growth, that is 19%. And in terms of normal growth, that is 25% recurring operating income. The operating margin also reached a record level at 28.3% of our revenue. And finally, let's not forget, free cash flow, which is just as important, has reached a record level at EUR 1.8 billion. However, over and beyond these figures, to my mind, it's the quality behind these figures, that's really important. If I can qualify that, really what I'm talking about is the balance and the highly diversified level of revenue. All our regions have grown by double digits. Over 12% organic growth in America, Europe up 19%, again, organic growth. And Asia and the rest of the world, also up 19%, again, organic growth. And if we dwell for a few seconds on our, what we call our key must-win markets, of which there are 4. The U.S.A. was up 8%. China rose 5%. India expanded by 26%. These 3 markets all reached record levels of revenue. And finally, Global Travel Retail sold by 48%. This gives us global growth of 17% with gains in market share in virtually all countries. I talked about diversified growth. It is a geographical diversity, but there's also diversified growth in terms of brands and categories. We've growth right across the board. 80% of our growth comes from 6 different categories. This is borne by all categories, by all price segments, by all distribution channels and between an equal share of emerging and mature markets. So Scotch whisky, for instance, which is a little over 20% of our business, grew by 25%. Irish whiskey, which is about 12% of our revenue, rose by 23%. Indian whiskeys, almost 10% of our business, rose by 19%. Vodka rose by 19%. Gin by 31%. And Cognac and brandys by 8%. And if you see what I mean by diversified performance. It's a really key part of our strategy in a volatile world with different sorts of cycles. But if we're agile in the way we allocate and reallocate our resources, we will continue to reap the benefits of opportunities that arise and continue to grow our top line. I can't resist the temptation of talking to you about 4 brands that have reached symbolic thresholds. In fact, another threshold of exceeded is over 2 billion bottles produced and sold this year. And I can tell you that our supply chain people have done a remarkable job. Speaking of symbolic threshold, we just exceeded the 1 million cases -- 9-liter cases with Lillet. Lillet on the right, this is wonderful little jewel in the Bordeaux crown that we bought in 2008. At the time, they produced 40,000 cases. We've since multiplied that by 25 to 1 million cases. This is -- we see the group's [indiscernible] the clout of its distribution network, which enables us to make a small local jewels are regional brands and then national brands and then international, even in global brands. We've also exceeded another symbolic threshold, that's 9 million cases of Ballantine's whisky. Last threshold we've reached is the 10 million cases of Jameson Irish Whiskey. When Irish Distillers merged Pernod Ricard in 1998, there were less than 500,000 cases. We've since multiplied that by 22 to exceed the symbolic threshold of 10 million cases. And finally, Absolut, which has exceeded the symbolic level of 12 million cases. I'd like to take this opportunity to show you the most -- the biggest marketing campaign in the last 10 years. This is called Born to Mix. It's an Absolut's marketing campaign. Video, please. [Presentation]

[Interpreted] Now we have achieved record growth, but it's also sustainable growth. I'm sure you'll have read in one of our press releases that we are about to invest in Midleton and the South of Ireland. We're about to invest EUR 50 million. Between now and 2026, we will have achieved carbon neutrality in our current distillery. To that, we intend to add a further investment of EUR 250 million to build a new -- brand-new carbon-neutral distillery. Again, in Midleton, this is to meet the strong demand for Jameson. I'd like to take this opportunity to invite you to view another video concerning these investments in the Midleton distillery. Video, please. [Presentation]

[Interpreted] So the group is investing more and more in decarbonation projects, particularly our distilleries, not just in Ireland, of course, but also in the U.K., Scotland or Canada. For instance, we've announced that we will invest EUR 100 million in Scotland in 2 of our strategic distilleries, Aberlour and Miltonduff. This is a single malt distillery. But also in production sites with more sustainable distillation technologies, but also to increase our production capacity because just like Jameson, our Scotch whiskys are also growing very rapidly. Just a quick technical comment. We have a technology called mechanical recompression of vapor, MVR. This is what we apply. So if you -- the boiling is at a very, very -- requires a very high level of intensity and a lot of carbon. So this enables the energy to be recuperated from steam used in alcohol and to reboil the [indiscernible]. This considerably reduces our carbon production. This is how we can contribute to decarbonation. So after a historical year, record year, we have a resilient group with a winning formula. Now I think this resilience and this winning formula are essential to our current environment. I'm sure you'll all have noticed that the environment is disrupted. We could talk about geopolitical tensions. We could talk about war. We could talk about the macroeconomic environment, which is volatile. Various problems along the supply chain or by change, of course, the return of inflation, the acceleration in climate change, which is really at the -- for the very first time, the general public's main concern. So after these recent months, I think we're in a semipermanent or cycle of crisis with all sorts of in-depth disruptions. Now Pernod Ricard has reaped the benefits of a, let's say, a favorable climate in recent years, but I can assure you that we are equally well equipped to continue our growth despite the challenges facing us. The reason for this is that our business model is based on a winning formula, a winning formula that leaves us very confident about the future. First of all, there's a number of underlying factors because of our industry between demographics, consumption and I'll elaborate on these. We also have competitive advantages that are unique. But we that makes -- that's our strength, be it the brand portfolio, be it the unparalleled distribution network or more importantly than anything else, our staff and our corporate culture and our values. Again, more about that later on. But for the moment, let's begin with the demographics. Last year -- I mentioned this already. The trends are unchanged. The demographics continue to grow. The population of age to enjoy your drinks is increasing. The middle classes are growing in the large emerging countries, and particularly China and India. Because extraordinary figure I'd like to quote, every year the population of age grows by 20 million to 25 million people in India alone. We are #1 in the Indian market with a market share in excess of 45% in the segment in which we operate. So the demographics are favorable to us in the wine and spirits market. Consumption, which I would characterize with 3 words: growth, premiumization and resilience. The consumption of spirits, the first time 2021 spirits became the biggest segment in alcohol, which includes beers and wines of the 33% -- from 33%, we increased that share to 42% in 2021. Likewise, the premiumization with premium or premium-plus projects -- products, we have grown, whereas anything below those levels have either stabilized or declined structurally speaking. In terms of resilience, while the global spirits market between 2019 and 2021, that market has grown by 11% in those 2 years. So the positive demographic dynamics, consumption been growing more and more upmarket, and all these have worked in our favor. A positive factor is, of course, the competitive advantage, the unique competitive advantages that we have. Let me begin by mentioning our remarkable brand portfolio is actually the broadest portfolio of its type in the sector. It's the most complete as far as it covers all these moments of conviviality, all these opportunities to celebrate, all price categories, too, but also all market segments. In this brand pyramid we have, we have a very well-established brand or what we call our blockbusters with huge growth potential. We also have a number of new categories such as specialty brands, which are part of -- well, let's say, the consequence of our M&A road map. And of course, over and beyond international and global brands, we have also got the ability to build strong local and regional brands, even very strong local and regional brands. Just take this opportunity to do a little bit of advertising, of course. A lot of our brands are now present in an American series produced by Netflix. It's a TV reality program called Drink Masters. It's a remake of Top Chef. But in this instance, we're talking about baristas, barmen and mixologists. This is the first program of its type. This actually raises the whole skill of bartending to levels never achieved before. So we would see our powerful brands at the heart of the whole experience of mixology, very encouraging. So I'd suggest you take a look at that on Netflix as one of the top 10 series on Netflix. You'll see that the way cocktails are appreciated to be it in the aesthetics, the virostatics, the taste, the creativity involved in making these cocktails. And of course, the very soul of the cocktail, which comes from the ingredients. But please don't hesitate to talk about Drink Masters around you. It's because we have a huge portfolio of brands that we can provide such a magnificent bar in this series. Well, of course, to sell our brands, you need people in the field. You need a customer-facing people. Here, we feel that we have an unparalleled distribution network with truly global presence and while we're in over 70 countries, but we have a direct presence with our own people in 75 of these countries. Very strong presence in emerging markets. When I mentioned India earlier on, where we have a market share of 45%, but also in China, where we have a market share of 45% in the segment we operate in. Now in these 2 brands, we're the only company to have a strong leadership. We're actually drawing -- benefiting 2/3 of the growth in these markets in years to come. We also have omnichannel or multichannel distribution capacities. Of course, our distribution network is very much in evidence with brand creators perceived as a great asset. These creators feel that over and beyond their creativity, this would endow them with a global distribution channel. This has meant that in recent years, we have been able to reinforce ourselves, thanks to our clout, the various acquisitions we made between 2016 and 2021, be it American whiskeys, where we multiplied revenue by 3. Gin, for instance, were we multiplied our revenue [ mostly 47 ], by 5, by 5, then by 3. And in recent months, we entered in 2 partnerships. Indeed, we made a number of acquisitions too or increased our stake in Southern brands, for instance, with brands like the Belaire sparkling wine or the Bombo Rum in France, [indiscernible] a classified growth. Tequila brands or -- but -- be the companies, the Whiskey Exchange, for instance, platforms. So our M&A activity is aimed at one, reinforcing our presence in certain key markets. Two, accelerating our business in certain categories. And three, at diversifying our distribution networks. In fact, they are the 3 partnerships or recent acquisitions announced over the last 3 weeks. The first of this is not new, of course, because we already had a stake in sovereign brands, but we have increased our stake in this company, which is in spirits, probably the fastest-growing company of -- or at least one of the very fastest-growing companies in the U.S. founded by the Berish Brothers. It's Brett Berish sitting beside me on the photograph. We also acquired a majority stake in the tequila brand called Codigo, about 100,000 cases a year in the U.S. And we also acquired a stake in a subtle brand, a Mexican brand called Nocheluna. This is in partnership with Lenny Kravitz. So we have the brand portfolio. We have the distribution network. And obviously, the Pernod Ricard specific strength is our people, our culture, our values. This year, again, we've demonstrated that our people, our greatest strength, as I said in my introduction, and our results would not be what they are without -- out of the 19,000 staff. Well, everyone works unflinchingly because we have invested in working conditions by focusing on well-being. Health and safety are at the core of our concerns. We foster inclusion. We offer career paths and performance-sharing schemes. And when you do all that, which is what we do, people remain and they engage, they commit to the company. To achieve our CSR environmental objectives, I do know that I can rely on the engagement of all our people wherever they are in the world. I suggest we take a look at a quick video. It's about those who are pioneers, the community which we call the catalyst [Foreign Language], who contribute to the acceleration of CSR efforts across the group. Video, please. [Presentation]

[Interpreted] Quite a transition to a key element in our strategy. CSR, it revolves around 4 items, 4 pillars I may say that have to do with the Sustainable Development Goals of the United Nations. CSR is our identity. My grandfather created the Paul Ricard Oceanographic Institute in 1966 at the originally, the idea was to fight pollution in the Mediterranean. And Patricia here is the Chairwoman of the institute now. CSR is our [Foreign Language]. We have to preserve the [ turvas ] that produce 125 ingredients that we use in our products. The challenge of the energy transition is an opportunity. It is a challenge to us, and we must optimize our processes. Therefore, we must sustainably change our habits, our behavior. This has to do with our collective responsibility as a corporation, but also as citizens. And I'm happy to confirm that we joined the EcoWatt initiative for responsible electricity consumption in France in the coming months. We are making great strides forward in achieving our environmental road map. One of the pillars has to do with turvas. Our industry is heavily dependent upon farming to produce aniseed hubs, guava, wheat, potatoes, beetroot and so on and so forth. All of these ingredients are using our products. And kind of the turvas are and have been a concern ever since the company was incepted. And it is, therefore, in keeping with that concern that we have rolled out many initiatives worldwide to preserve biodiversity and secure sustainable farming. The group set up a 3-pronged action plan to map these ingredients, identify the risks that bear upon the turvas and deploy biodiversity of projects towards regenerative farming practices. All our wine-growing areas involve partnerships. This helps us better understand local context and include best practices. Pernod Ricard is, therefore, a pioneering group when it comes to the preservation of biodiversity. And I'm not the only one saying that. There are experts such as Sébastien Roumegous, Chairman of Biosphères, which is a company that specializes in regenerative farming project. And I'll give him the floor right now. Sébastien?

[Interpreted] Good afternoon, everyone. Thank you very much for giving me the opportunity to speak at this AGM. I think this is landmark moment. We worked for quite a few large groups and CSR, sustainable development, regenerative farming, economic resilience and added value. And that is good news because I've been working in sustainable development for 10 years, and I'm very happy about the momentum we're experiencing because this is unique in the history of human kind to have to be aligned when it comes to observing the situation and finding the right solutions. Very happy to be with you. And I suggest we explore regenerative farming within a few minutes. And I'll try to show you what we are doing with and for Pernod Ricard. Biosphères is a company I set up roughly 10 years ago. Now we have a staff of about 40. We work both in France and internationally. And our mission is to secure and simplify the transition towards regenerative agriculture. I'll explain what that is all about. But obviously, when you move from one way of producing to another, there transition is required. And you have to set up a kind of engineering process. It can be complex, especially when you're talking about market verticals, various ingredients, large or small farming surfaces and so on. When it comes to the situation of farming practice, I often show these photographs. You see farming landscape can look like this. Overall in winter and the spring, when you drive through farmland, you can see brown land, which is kind of bare. It's part of our culture. And yet, it is a problem because it does lead to erosion. You see that there's not much going on in terms of living beings. Therefore, the ecosystem is kind of shattered. The challenge taken up by regenerative farming is to produce both quantitatively and qualitatively. We have done that amazingly over the past few decades. But in the coming years, we must produce while preserving the essential functions of the ecosystem. Regenerative farming is based on 3 pillars. The first pillar is the soil. As a matter of fact, I recommend you a film called Mission Régénération -- Mission Regeneration. The regeneration of soil has to do with regenerating the skin of the earth. There must be active biodiversity at the surface of the earth. So there are stars like the worm the -- but there are microbiological creatures as well. And also, we need farming practice to protect the soil and to constantly improve its quality. So the plant, it can be barley, potatoes, wheat, maize, whatever. So the plant feeds are on the soil. And that is why we have to start with the soil in order to save on ingoing products. You have -- you need quality in the soil for your plants to be quality plants. So the soil, the plant and then the landscape. It's more complex. There's multiple factors involved. And therefore, landscape means this landscape infrastructure, whereby you can have an impact on the micro climate. There's been a lot of draught lately. You have to foster the water cycle and minimize droughts 40% of what produces oceans is produced through the perspiration of plants, which is why with regenerative farming, we transition from fields where we focus on plants to sharing resources with other plants. You have plants, and between the apricot trees there is nothing, but you can cover them, cover up what's between the trees. It's not just about reducing pesticides, it's about feeding, providing energy to these insects and all these animals. And the plant is the beginning of the feed chain, it feeds on water and the sun to produce energy. And we need that energy. That's the energy we do feed on based on photosynthesis. And in wine growing. Now here, we work for Pernod Ricard. The transition is from an area where we reduce what is between the plants. Here, you have -- we feed this soil between the wines. And that is done with practices such as this one. We also work on reducing pesticides. We work on agroforestry. And our approach to the landscape is such that surface can be lost, but what matters is the restoration of the balance, the living balance. So soil, plant, landscape, those are the 3 pillars, and it's great to work with that. And then our collaboration with Pernod Ricard has been going on for 3 years. It involves all wine-growing practices. We started with France, then Armenia. Next week, we're going to Argentina. So all in all, it's a worldwide experience on the back of COVID and we are moving on to other vineyards in New Zealand, Australia and elsewhere. 3 years ago, Pernod Ricard's pioneer launching something comprehensive. You see the programs launched in 2020, 360 audit of the activities. We looked at all the vineyards and we set up an experimentation program. Whenever there is a change, you need a pilot, of course. And we are right in that phase, pilot phase. We are setting up the practices. We assess the economic social impact and so on. And from next year, we shall move up to scale with all the wine growers because, of course, there are emblematic sites where you produce grapes. But of course, there are all the wine-growing partners. There are thousands of them who provide grapes to be processed. And that means moving to scale. And that is the enventure we're going to start next year. There you are. So this is farming tomorrow. Actually, the fields are green and no longer brown with green plants that stabilize the living being. It's good for the water cycle. 40% of the water from the -- on the planet that comes from the plants going to the cloud. There are solutions. We know them. And with groups like Pernod Ricard, I think that the private sector will make it possible to move to scale. So I'm very, very happy to be able to contribute to this adventure alongside Pernod Ricard. Thank you very much.

[Interpreted] Thank you very much, Sébastien. Heartfelt thanks. We can make a difference in that area. The 120 ingredients I mentioned earlier, from over 350 terroirs, the 800,000 hectares. So we're not talking small scale here. I think that we can indeed make a difference in that regard. The second pillar, making most of our people, and extol the virtues of our people. And we work on that unflinching. As a matter of fact, I'm very happy to announce that we've already reached -- we've bridged the gender pay gap. And we have more and more women in executive positions. Profit sharing is at a record level this year in our French subsidiaries. And we've also successfully conducted the second shareholding -- employee shareholding program across 24 markets. So now every other employee in the group is a shareholder of Pernod Ricard. And shares into the profit and the group's performance. All these efforts contribute to the recognition of the attractiveness of our employer brand. And as a matter of fact, we've just been ranked among the world's best employers by Forbes, which is a fine recognition indeed. And this is important when it comes to attracting talents moving forward. And we also focus on communities. We have trained over 6,500 barmen and barmaids to responsible consumption in the Bar World of Tomorrow program. At this point, I suggest we take a look at a quick video that explains the engagement of our people when it comes to mobilize them to embody our CSR vision. The video was shot during our Responsive All Day in June, the theme of which was biodiversity. Video, please. [Presentation]

[Interpreted] Okay. The third pillar has to do with circularity. Here, you have 3 concrete examples of what we do. For instance, we announced the gradual elimination of secondary packaging across our Indian portfolio. Here we're looking at EUR 0.5 billion items per year. More recently, we announced that Chivas Brothers, the elimination of 2,000 tons of cardboard in the next fiscal year, i.e., 780 tons of CO2 emissions with the gradual elimination of Chivas 12 cardboard boxes starting this fall. As a matter of fact, we've advertised for that, as you can see. And finally, we have a private project and its circular distribution with a great start-up called ecoSPIRITS. And we are testing this in Hong Kong and Singapore with Absolut Beefeater and Havana Club. Our industry vision is a world where there's more responsible alcohol consumption. And that is the fourth pillar being responsible. That's a key element in our CSR strategy. We have digital labeling, very proud of that, a pioneering initiative. This QR code is being deployed in our pilot bottles, Jameson, Martell, Absolut, Ballantine's in Europe, and it will eventually extend across the group's portfolio worldwide as of next year and the global rollout will take place in 2024. This will allow all consumers to have information about our products and about responsible consumption wherever they may be in the world. So responsibility involves transparency. And we are also requesting that all our subsidiaries contribute to responsible consumption initiatives of which there is the "Drink More… Water" campaign, which was seen by over 180 million people all over the world. Okay. Now I'm reaching the third and final chapter of the management report and the chapters entitled a long-term value creation strategy. Our transformation began in 2015. Let me come back to the foundations of the Pernod Ricard Group. So we have a portfolio, distribution network culture teams, all of that unrivaled. In the past, we were focused on growth. So we launched the mindset for growth strategy a few years back. That was in 2015. Once we achieve that, we entered the next phase 2018 to 2022, Transform & Accelerate, another strategic plan. And in addition to growth, we were contemplating profitable growth. So obviously, what matters most is top line growth. But then, of course, we look at operating margin. We want growth both in the top line and in the bottom line. And more recently, at the Capital Market Day, just before the summer, we announced the current strategic project. It prefers to deliver profitable growth. And profitable growth -- so we call stretched profitable growth and it is indeed more ambitious. We are aiming for the higher end of the growth bracket that we could deliver. And in order to achieve that, we presented the Conviviality Platform concept. The Conviviality Platform revolves around 6 growth levers. 3 of them account for 80% of what we do, 3 levers, i.e., the efficiency of our portfolio and marketing investments, I'll come back to that. Secondly, the optimization of pricing, revenue growth management, promotions effectiveness. And the third area is the acceleration of prestige and top end products. And 20% of our focus, it sits with the growth of the future, which there are 3. The first is new categories, innovation, therefore, new products, for instance, ready-to-drink products, RTDs in the U.S., which are growing strongly. The second one is the route to market. The B2C, direct-to-consumer, alternative distribution channels, which I broached upon a moment ago. And the third area for the future is experience and service. Because consumers above and beyond the brands want a genuine experiences and services. And in order to accomplish all that effectively on a large scale, we use technology and data algorithms. Algorithms do enable us to be effective and very quickly so on a very large scale. Today there are algorithms about promotions effectiveness. We have 32 criteria, which we enrich. And the algorithm recommends the ways to maximize promotions based on criteria such as the type of promotion, the type of the discount and so on and so forth, frequency, duration and so on, even temperature. The list goes on. And this is a -- on artificial intelligence process, which is quite remarkable indeed. And that is what is going to enable us to accelerate our growth. When I say that our strategy is a winning one and it delivers over time. When we had the mindset for growth project, we reached 6%. And then we focused on operating margin in addition to that and from 2018, 2019, Transform & Accelerate, profitable growth. And then finally, and I think we can go for the top end of the bracket, plus 7%. We believe that, that is a trajectory that is quite sensible and we can do that with technology and data that is what we need to be so ambitious. And if it delivers in terms of growth and profit, obviously, it must be seen, it must be reflected in the share price. Here, you have earnings per share, dividend per share since 2016. You see the share price, you see plus 14% for the dividend over the period. Pernod Ricard share price since 2014 has doubled, plus 100%, whereas the CAC increased 37%, 41% as far as the food and beverage stocks index is concerned in Europe. And then you see the total shareholder return, which has been doing very well, too. So growth has been delivering. Well, before giving the floor to Hélène de Tissot, I'd just like to share you a few views about -- with you about our position as creators of conviviality. While I've talked about performance and clearly, we have performed. But what also matters more and more so is the development of what we call brand capital. This is the image of a company whose products you want to buy, but also the image of a company who's most talented people, its youngest people in particular, are keen to work and commit to. That's our ambition to become the reference group in our sector, but not just in our sector. That presupposes taking on our responsibilities as a company with hundreds of millions of men and women -- as much more than you think it's actually the whole vision of the world. Our vision at Pernod Ricard is a vision of the world of wines and spirits. We will have carried out our ecological environmental transition by gaining in quality, naturalness, genuineness. This is a world in which the consumption of alcohol will be more responsible, and we're working on that. This is a world in which conviviality will win over isolation and social isolation -- conviviality at times of celebration, but also in the more simple day-to-day moments. Our group brings together men and women who over and beyond the borders and the differences between them, actually, share values, aspirations, a world that we share together. So conviviality has always been a value despite our fragmented society and the temptation to isolate. Well, self conviviality has become something urgent, something to fight for. Pernod Ricard is very proud to wage this war. Proud to be the group that acts as a link between the particular area of its brand, contributes to bring men and women together despite the cultural, social, geographic distances that separate us. All our employees are now known as convivialist. Our vision of the future is a world in which should everything changes and everything is challenged. We invariably come back to what it is that keeps us together. It's the desire to be together. This conviviality that my grandfather and my family was so keen on, that's all our convivialist are so keen on has brought you together here today in the [indiscernible]. I think it has still a lot of potential to reveal. Now that are the few words I wanted to share with you before. Giving the floor to Hélène de Tissot to give you a detailed presentation of our group's financial performance.

[Interpreted] Thank you, Alexandre. Good afternoon, everybody. My part of this is much more technical. I apologize. I'm going to tell you about the consolidated financial accounts for the period 2021, 2022. Let me begin with this summary. Our performance was excellent, a record year, as Alexandre said. We reached a record revenue of EUR 10.2 billion, up over 17%, that's organic growth. So it's been solid, diversified with market share gains in most countries. Price increases in mid-single digits on average. Current operating or recurring operating income is also at a record level at EUR 3 billion. That's organic growth of 19% and the operating margin was improved by 52 basis points. Free cash flow also reached a record level. Free cash flow from recurring operation of EUR 1.9 billion. And of course, the shareholder return has accelerated today's dividend, which you will be voting on later on is a proposal of EUR 4.12 per share, which is up 32% on last year. Key figures. Revenue up 17%, that's organic growth and a normal growth of 21%. Positive currency translation impact of EUR 300 million. The current recurring operation -- operating income was up 19%. Internal growth or normal growth of 19%. Net recurring income after tax and financial expense was EUR 2.124 billion, up 32%. Net income of almost EUR 2 billion, up 53%, thanks to the strong growth of our recurring operating income, financial expense and positive currency translation. Free cash flow of EUR 1.8 billion, up 11% over the previous financial period. Revenue by region now. Double-digit growth in all our regions. America, up 12% for the period with very strong growth in North America and indeed in Latin America. Also Travel Retail, Asia and the rest of the world, up strongly 19%, driven largely by India, Turkey, China and Sub-Saharan Africa. Performance in Korea and Japan were also very good. In Europe, growth was excellent at -- up 19%, thanks to Spain, Germany, Poland and the U.K. Also a very good pickup in Travel Retail. Let's now look at the breakdown of revenue by category. All our categories of Spirits achieved a double-digit growth. International Strategic Brands rose by an excellent 18%, driven by Jameson, Ballantine's, Absolut and Martell. Local static brands, up 18%, driven by Seagram, Kahlua, Olmeca and Seagram's Gin. Specialty Brands continued to post strong growth of 24%. Thanks largely to American whiskey, the Gin portfolio and Agave based drinks. So Specialty Brands doubled their contribution to overall sales by comparison with the 2018, '19. They now account for 6% of our revenue. They were only 3% back then. Wine performed less well, largely due to the low yield of the harvest in New Zealand. Propose now to look at the income statement. You know the revenue figure of EUR 10.7 billion, gross margin up 17% on last year, with a percentage margin of 60%, up 12 basis points, thanks to the positive mix price combination and a good control of our fixed costs. Advertising and promotional sales up 17% with a good allocation of our investments between the brands, markets and distribution channels. The ratio of our advertising and promotional sales was 16%. Structure costs rose 14% with targeted investments, particularly due to recruitment to help out with our digital transformation. As a result, the recurring operating income of EUR 3.024 billion was up 19%, an operating margin of 28.3% of revenue, up 52 basis points by comparison with the previous financial period. Net income attributable to the group, EUR 3 billion -- at EUR 2 billion, I apologize. Net income group share was up 53%, largely due to the strong growth of our profit from recurring operations, our financial expense and the positive impact of currency translation. I now propose to look at how our net debt has evolved. The gearing is down. We were at 2.6, a multiple of 2.6, we're now down to 2.4. Despite the increase of net debt by EUR 1.2 billion over the period with a strong free cash flow of EUR 1.8 billion, which has funded acquisitions for a total of slightly over EUR 600 million. I mentioned the investments that involve a cash out. This is in Sovereign Brands, the Whiskey Exchange and [indiscernible]. Dividend payout was EUR 863 million, and of course, the share buyback plan for a total of EUR 750 million. Increasing net debt involved a number of more technical aspects, in particular, the negative currency translation effect, EUR 562 million because of the strengthening of the dollar against the euro. Now moving on to the statutory accounts of the parent company, Pernod Ricard SA. The net result is a positive EUR 1.835 billion, which is an increase of EUR 1.2 billion over the previous period, mainly due to a sharp increase in intra-group dividends. Speaking of the dividend. Today we propose to approve the payout of a dividend of EUR 4.12 per share, which is perfectly in line with the policy of paying out 50% of the net recurring operations. That's up 32% on last year. We also announced a new share buyback program for the current financial period '22, '23 for an amount of between EUR 500 million and EUR 750 million. We've already launched a first tranche in recent days for EUR 150 million, which should be completed by the 22nd of November next. At the end of June 2022, we had bought back approximately EUR 1.25 billion since the 2019-2020 financial period. A few words now, if I may, about the start of this current financial year is the first quarter of the period 2022, 2023. In the first quarter revenue rose a normal 22%. That's organic growth of 11% with a strong price impact of plus 7%. This is good, strong, diversified growth in all our markets. The distribution figures are good, with expedition, phasing or shipping phased, very strong growth in China, India, good dynamics in Europe with a very good tourist season, which has sustained demand in -- on trade. So a strong price impact, 7%. And of course, these are price increases that were passed until last year. Also increased prices started this year in the United States. Travel Retail has continued its recovery. Volumes are up in all 3 regions, leaving aside Russia and Ukraine. Thank you for your attention. Let me now give the floor back to Alexandre Ricard to say a few words about the outlook for the current financial period.

[Interpreted] Thank you, Hélène. As for the current year and the outlook. Well, in a volatile environment, we expect nonetheless, strong diversified growth, not as strong as maybe in the first quarter, a more normalized type of growth shall we say. So we will continue our investment policy and investing in our brands, investing approximately 16% of our revenue in marketing. We will continue to invest in structure costs in particular, as Helene said, to support our digital transformation plans. Strong priority to pricing initiatives, that's what we call revenue growth management but also operational efficiency in a highly inflationary environment. Finally, based on current exchange rates, we expect that the ForEx impact will be highly positive. Let me now give the floor to Patricia Barbizet to tell us about the group's governance.

Thank you, Alexandre. Dear shareholders, I'm very happy to be -- is that better? I'm very happy to be with you this afternoon. And I'm speaking as the senior independent director, but also as Chair of the Nominations and Governance Committee. In this capacity, may I remind you that the roles and tasks of the Senior Independent Director are defined in the Board's bylaws, which can be found on our website. Let me begin by telling you about our Board of Directors. You have the 14 directors on the screen here. Of these 14, we have 2 employees representing the employees, Maria Jesus Carasco Lopez and Bryce [indiscernible]. As you see on the screen, the Board of Directors is diversified with a lot of complementarity. And as part and parcel of Pernod Ricard's strategy, the skills of the directors cover the following areas, in particular, finance; audit and mergers and acquisitions; senior management strategy; digital and technologies; CSO and human resources; innovation; knowledge of the industry and of consumers; and finally, governance and compliance. The proportion of women and the proportion of independent directors would be pointed out to you in a few seconds. The rates are actually stable, and it will be maintained unchanged after this meeting. In the course of the last financial period, we met 8 times with an attendance rate of 100%. We're very happy to meet again at The Island. That's our new head office. Come back to the main activities of the Board over the financial period in question. In particular, we tracked the group's business. We reported regularly on the health and safety policy, and of course, its implementation in the group's different subsidiaries. We reviewed the group's strategy and growth. We closed the accounts, that's the interim and annual accounts. We assessed the variable compensation of the Chairman and CEO for the period '21, '22. We determine the compensation policy for '22, '23. These are, of course, discussions that took place without the presence of our Chairman and CEO. We organized an executive session to review, in particular, how the Board and its committees operate the performance of our Chairman and CEO and of course, the succession plan. We've also been keeping an eye on the different committees' work. We discussed the -- all matters concerning the health of the group's employees, particularly in relation to COVID-19, the impact of remote working. We reviewed the whole issue of diversity, quality and inclusion and discussed the results of the ISEA survey. As a Senior Independent Director, I met our main investors to talk about the governance of our company. I also chaired the executive session in July 21, and I [ okayed ] that the internal assessment of the Board's operations on the basis of individual discussions with each of our directors. A report of this assessment was then drawn up and given to the Nominations and Governance Committee, but also to the Board of Directors. And I propose to talk to you about the 5 committees more specifically. These are the committees to which the Board [ interests ] preparation of special topics. I want to say a few words about what they do and for all [indiscernible] intents and purpose, I'll tell you about the number of independent directors, which is always equal to or higher than the recommendations of the French Employees Federation, the Afep-MEDEF Code. So as you see on the screen, the attendance rate for each of our committees was 100%. During the year, the Audit Committee, first of all, examined the proposed interim and annual accounts, updated the risk map, reviewed the group's internal control and approved the audit plan for the current period, that's 2022, '23. And of course, kept an eye on the rollout of the group's compliance program. Concerning the Nominations and Governance Committee. This year, the committee reviewed the independence of the various directors, reviewed the group's talent management policy and the planned succession, particularly for the main senior managers, reviewed the group's policy on diversity, professional equality and employee equality, and reviewed the auto assessment the Board of Directors and its committees. The Compensation Committee now. The main activities of the Compensation Committee are on the screen. We reviewed the variable component of the Chairman and CEO's compensation and kept an eye on the consistency of this criteria. We proposed the general attribution policy and the long-term investment policy of the group, and analyzed market practices and trends concerning compensation of Chairman and CEO and directors in general. Fourth committee is the Strategy Committee. Strategy Committee reviewed market performance and the key categories and took part in the continuation -- continued rollout of the group's strategic plan called Transform & Accelerate, Season 2. The CSR Committee reviewed the group's CSR strategy, reviewed a number of objectives concerning our CSR strategy, net 0 carbon for scopes 1, 2 and 3 by 2050 was advised of projects being developed in the group to meet these CSR strategic goals and, of course, continued with the CSR report. So all the committees and the Board worked on a very great variety of subjects, which, of course, go hand in hand with the group's development. This presentation of the group's governance is now complete. Let me call on Kory Sorenson, who is Chair of the Compensation Committee, to join me here on stage to talk to you about the policy concerning the Chairman and CEO's compensation.

Good afternoon. As Chair of the Compensation Committee, I'm going to talk to you about the compensation policy concerning the Executive Director. I will give you detailed information on the ex post votes on the eighth resolution. And of course, the ex ante votes in the ninth resolution. You'll find all the information in the universal registration document on Pages 65 to 80 in the French version. The components of compensation paid or attributed to Alexandre Ricard for the financial period 21/'22 mentioned in the eighth resolution include a fixed annual compensation of EUR 1,250,000. That's since the 1st of July 2021, a variable component of EUR 2.25 million, which is equivalent of 180% of its fixed component for a target of 110% and a maximum of 180%. The details of achievement of each of these criteria is mentioned on Page 71 and 72 of the French version of the universal registration document. There's also the attribution of 11,534 performance-based shares, including 600,771 shares, which are subject to internal performance criteria, 4,763 shares subject to external performance criteria. The compensation also includes the attribution of 1,986 performance-based shares for an IFRS value of EUR 322,815, as well as the payment -- cash payment of EUR 323,000. Finally, Alexandre Ricard also has a company car and a providence fund and health expenses. I should also add that Alexandre Ricard does not receive any compensation as Chairman of the Board. Let me now move on to the compensation policy for the Executive Director for the current period 2022, '23, which is covered in the ninth resolution. On the recommendation of the Compensation Committee, the Board ensures that the compensation policy is balanced, is a courageous performance, it reflects the group's strategy and abides by the social interest and, indeed, the interest of employees. As is the case every year, Alexandre Ricard's compensation was reviewed and compared with those of his main competitors. This confirmed us in the view that his compensation is balanced, includes a significant variable component, which is an incitation to achieve performance, adapted with his responsibilities or to his responsibilities and is consistent with the leadership that Alexandre Ricard has shown. The Board of Directors has, thus, on the recommendation of the Compensation Committee decided at its meeting of October 31 of this year to leave the compensation policy of the Executive Director unchanged and to maintain the following components for the financial period 2022, '23. So fixed component of EUR 1.25 million; an annual variable component with a target of 130% of the compensation component when objectives are reached with a maximum of 180%. The attribution of performance-based shares shall not exceed 150% of his annual fixed compensation. Additional compensation in the form of a top hat pension, corresponding 20% of his annual fixed and variable compensation composed by half of performance-based shares and the other half composed of an amount paid in cash to be invested in dedicated investment media for his supplementary pension. Concerning these deferred components, the Board of Directors recommends that the following arrangements be maintained: a no compete clause, a forced departure clause, subject to performance criteria. The combination of these 2 clauses may not exceed 24 months of fixed and variable compensation. In the light of these elements, we propose that you approve resolutions 8 and 9. Thank you.

Thank you, Patricia. Thank you, Kory, for these presentations. Now I would like to give the floor to Mrs. Caroline Bruno-Diaz from KPMG to speak on behalf of the statutory auditors in presenting the statutory auditor's report.

Thank you, Chairman. Ladies and gentlemen, dear shareholders, speaking on behalf of all the statutory auditors, KPMG and Deloitte, it is my pleasure to report on the work that we have done for the fiscal year ended 30 June 2022. We published several reports. And in compliance with what is usually done this AGM. I will not read them out in full but I will summarize them to you. The report on the consolidated and parent company accounts have been made available to you in the AGM documents. They are to be found on Pages 254 and 281 to 183 of the universal registration document. We would like to remind you that the purpose of our work is to obtain reasonable assurance regarding the truthfulness of the accounts that they are a truthful reflection of the company's business and that there are no significant anomalies. Therefore, our 2 firms have worked in all the significant entities of the group. Following our work, we presented our conclusions to the financial department, to senior management, to the Audit Committee and to the Board. The report on the consolidated accounts and the parent company accounts states the key items. For the consolidated accounts, there's the evaluation of the brands and tax risk. The report on the accounts will feature the description of all the risks identified and the response that we have found. In conclusion, the consolidated accounts give a truthful reflection of the company's business in compliance with IFRS requirements. It gives a truthful reflection of the group situation as at June 30, 2022. We have thus published our report without any reservation. We hereby -- we certify the accounts accordingly. Regarding the annual accounts, the key point of our audit had to do with the assessment of participation of securities. This can be found in the report on annual accounts. Following our work, we certified the accounts of your company without any reservation and with one observation regarding the change in the accounting method pertaining to the booking of pension commitments. The report on the accounts also features the conclusions of some verifications according to the law, verifications that we have done regarding the information required in the management report. In that regard, we can certify that the information supplied is truthful when it comes to the compensation and benefits granted to the Executive Director and in compliance with the annual accounts as far as lead time for payment is concerned. In compliance with the new requirements, we found that the electronic format requirements in Europe were indeed complied with. At this point, I would like to move on to our special report on related party agreements. You can find that on Page 284 of the universal registration document. In summary, there was no new related party agreements submitted to the approval of the AGM. In our report, we point out the related party agreement that had already been approved by the AGM in previous years and the execution of which carried through during the fiscal year elapsed. Ladies and gentlemen, dear shareholders, thank you for your attention. And I give the floor back to the Chairman.

Thank you very much for this presentation. Now I would like to give the floor to Anne-Marie Poliquin, who is the Secretary of the AGM. She will present the resolutions that we will submit to you. This year, there are no resolutions under the extraordinary AGM because this is indeed an ordinary Annual General Meeting.

Thank you, Alexandre. Good afternoon, ladies and gentlemen. Now I'm going to give you a summary presentation of the resolutions that are submitted to you. The full text of the resolutions can be found on -- from Page 45 of the invitation that was given to you. In the brochures, Alexandre says only resolutions under the ordinary AGM will be submitted to you. Therefore, I will speak much less than last year. The first resolution has to do with the approval of the parent company accounts of Pernod Ricard SA for fiscal '21, '22. In resolution 2, we are asking you to approve the consolidated accounts of Pernod Ricard for the same fiscal year ended June 30, 2022. Resolution 3 has to do with the appropriation of profit. As Helene mentioned earlier, the dividend can be set at EUR 4.12 per share in accordance with your agreement. An interim dividend was paid on July 8, 2022. The balance, that is to say EUR 2.56 per share, will be detached on November 25, 2022, with a record date on November 28, 2022, and settled on the 29th of November. Under resolution 4, we are looking at the renewal of the directorship of Mrs. Patricia Barbizet for a period of 4 years. Under the fifth resolution, we are looking at the renewal of directorship of Mr. Ian Gallienne for 4 years. Under resolution 6, you will have to vote upon the renewal of KPMG SA as a full standing statutory auditors for 6 fiscal years. In compliance with the law and our articles of incorporation modified at the AGM 2018 under resolution 7, we suggest that the mandate of Salustro Reydel as substitute statutory auditor not be renewed. Resolution 8, approval of the fixed and variable components of the compensation and every benefit granted or to be granted for fiscal 2020, 2021 to Mr. Alexandre Ricard, Chairman and CEO. All the components can be found in the universal registration document in Pages 68 to 74. Under resolution 9, we will ask you to vote upon the approval of the components of the compensation policy applicable to Mr. Alexandre Ricard for fiscal 2022-2023. The components of the policy are presented in Pages 75 to 80 in the universal registration document. Under resolution 10, we are asking you to approve the information pertaining to the compensation to be paid or paid out to all the executive directors for fiscal '21-'22. The information can be found in the universal registration document in Pages 81 to 83. Resolution 11 has to do with the approval of the compensation policy components applicable for fiscal '22-'23 to the executive directors. The information can be found in Pages 83 and 84 of the universal registration document. Resolution 12 has to do with the authorization to be given to the Board to trade in its own shares. This is capped at 10% of the share capital. This would be given for a period of 18 months with a maximum purchasing price of EUR 320 -- EUR 120 per share. Under Resolution 13, we are asking you to approve the related party agreements under articles 225-38 et seq. of the Code of Commerce. And as presented by the statutory auditors, no new related party agreement was entered in fiscal '21-'22. Finally, under resolution 14, we are dealing with the powers to carry out the required legal formalities. I've completed my presentation, and I give the floor back to the Chairman, Mr. Alexandre Ricard.

Thank you very much, Anne-Marie. At this point, I suggest we open the discussion. Before our exchange, I would like to tell you that 10 questions were sent to you in writing by the [indiscernible] FIR on October 17. This year, the Board, which met on November 10, decided to respond in writing and to publish the responses on the website of the company before the opening of the AGM. The idea, of course, is to have as much time as possible to have a discussion with you. The answers can be found on our website under the AGM section. Okay. I hereby open the Q&A session with the shareholders.

I work for the association of individual shareholders. You shared records with us. I would also like to share with you the record broken by individual shareholders. In spite of the transportation strike, there are quite a few people in attendance. Some people must have come yesterday in order to attend this meeting and listen to what you said. And my 3 questions, which is not a record, I only have 3. First, you launched a limited edition for the 120 years of the Belle Epoque on Conviviality Perrier. What is your champagne strategy given the fierce competition out there in spite of the fact that the years were deemed exceptional? My second question. Last year, you acquired the Whiskey Exchange, an online marketplace with 2,000 products. What market share have you won against Diageo? My third question. The Indian administration is claiming the equivalent of EUR 250 million from the local subsidiary, Pernod Ricard, on the grounds that it underestimated the import value of concentrate for many years in order to minimize duties to be paid. Isn't this a new obstacle in a country that you consider as a major growth relay and which you were already facing certain accusations? Thank you in advance for your responses.

Thank you for your questions, sir. Again, we are very happy to see the efforts you have made to attend this meeting in spite of the strike. I will answer the first 2 questions. Helene will answer the third one. Regarding Perrier-Jouet and Belle Epoque, in particular, the strategy is extremely clear. We are looking at a value strategy. We are moving up the range. It's top of the range strategy in terms of the products that we offer and also in terms of the price that we charge because as you know, as you have read in the press, supply and demand are identical. There may be more demand than supply as a matter of fact. And managing scarcity is something that's nice actually. Regarding the Whiskey Exchange. The strategy consisted in entering an alternative route to market which remains very independent, by the way. And that's very important because the bulk of the Whiskey Exchange is not with our brands. We have market share in the Whiskey Exchange, and we follow that closely, of course, as we also follow our market share in our stores and so on. We do not publicize this information, but the Whiskey Exchange platform, which is #1 outside the U.S. as far as I know, is a huge growth lever to beautiful alternative route to market with an omnichannel approach, if I may say so. Regarding the third question, Helene, what can you say?

I'll try to be brief. You referred to information that was found in the media about a dispute that we have today with the Indian customs authorities. To put things in perspective, India is a key market for -- we are the leader in our price segment. We have invested for over 20 years in India. And we amplified what Seagram has initiated in 2008. The environment in India is complex, especially in terms of regulations, if I may say so, and I am answering your question. Our performance in India is essentially achieved through our portfolio of Indian whiskeys. These are whiskeys produced in India, and the quality is remarkable because we do add scotch whiskey to it. And that is precisely the subject of the dispute because we do import the scotch whiskey concentrate into India. So that is where the dispute arises regarding the value of these ingredients, and we do pay customers. It is in compliance with the Indian legislation. So the -- we must be aligned with the customer authorities regarding the import value we have followed. All the regulations are global standards, by the way, and we are currently having discussions with the Indian customs authorities. This information is not public because we are doing this in court. And we are trying to find a solution with them. Again, India is a key market. We are there to stay, and we follow the Indian regulations. And the idea is -- sorry, the short answer is it's all about the import value of the Scotch whiskey concentrate.

Okay. Moving on to the next question.

Good afternoon. [ Louis Mot ]. I have been a shareholder since -- well, Pernod Ricard was bottling Coca-Cola. You said that you were pursuing a value strategy. But isn't the name Pernod Ricard an impediment because you have premium brands that are as fine as those of Mr. Arnault, and being in the beverage section in [indiscernible] magazine may not be ideal. You have international brands. You did not mention Ricard once, not even Pernod. Wouldn't it be high time to ask while help Indian and Chinese investors with more simple brand names, Aberlour, [ Moment ], so on, or original brands, like Ricard or Pernod. Because it seems that on the global market, investors in France there's only the premium market, very high value like LVMH, Kering and Hermes that people are interested in. Wouldn't it be high time to put your name in line with your strategy?

Well, first of all, I'd like to thank you for your loyalty in the long term. Make no mistake, product brand names and the corporate name Pernod Ricard are 2 different things. Pernod Ricard is the merger of 2 family companies, Pernod on the one hand, Ricard on the other in 1975. And the vision was quite straightforward. The idea is to stop fighting in 1 category of Pastis and 1 single market, France and go join forces to conquer the world and other spirits categories. The vision, through the efforts of all my predecessors and all the teams who contributed to the Pernod Ricard history, has been an accomplishment. In 1975, 5% of Pernod Ricard sales was abroad, and it was roughly 5% in other categories in Pastis. It's the same figure. [indiscernible] around, 5% is the proportion of Pernod Ricard in France and 95% abroad. And same thing for categories. Pastis is a mere 5%, whereas other categories are at 95%. And thank goodness, this vision was an accomplishment because if we had stayed to Pastis in France, we wouldn't be here talking to you today, and you wouldn't be asking any questions. Pernod Ricard attracts talent. Pernod Ricard sort of rhymes with conviviality. The people in the group whose engagement rate is amazing, love the story of Pernod Ricard. There's a film we produced for the 40th anniversary of the group. It's a 1-hour film, and all the employees who joined the group joined it because they know the story, they watched the film. They're part of the history, those are our roots. So we could be called chauvinists or anything else, but it's not the same thing you see. The targets are different. The consumer goes into a store, buys a brand, a bottle of Chivas, a bottle of Martell, a bottle of Royal Salute. They don't buy Pernod Ricard. You see they buy a bottle of a brand that has its own history, its own heritage, its own soul, spirit, if you'll excuse the pun. And our marketing teams work on the story of all our brands to engage with consumers. And our HR people, our communication staff, our Investor Relations teams work on the corporate brand name. And in the world of investors, bankers, of which there are a few in attendance, by the way, and the world of shareholders and talents, Pernod Ricard is a well-known marquee name. It's a brand name. And conviviality is a notion that is spreading like wildfire, especially in countries far from France, Pernod Ricard in China with 45% market share. Pernod Ricard is well known in China, of course. And to come back to India, to go full circle. In India, it was called Seagram's India. When we went ahead with the acquisition, we bought out Seagram's in 2001. There was an adamant request of the Indians a few years later, and that brought about a name change. We were prepared to keep the name Seagram's India. Seagram's is a very powerful name in India, by the way, or it was. But our Indian teams on the ground requested actually demanded the name Pernod Ricard. So now we do attract many talents, not only in the industry but from other industries as well. We are a very attractive company. We had the best employer award granted by Forbes, first-time ever. And we're the only company in the spirits industry in that ranking by the way. Okay. Back to question. Next question, please.

Good afternoon, Chairman. My name is [ John Hisha ], I'm an individual shareholder. Well, like last year, I will congratulate you on these marvelous results. You've explained the results well, no need to dwell on that. We're all delighted that everything is going so well. One other thing I would like to point out is that every second employee is a shareholder, which is good on top of everything else. I have 4 short questions, somewhat peculiar I haven't got Mr. Du Solange's technical know-how, but a few questions I'd like to raise. A few things strike me as unusual. Of course, I got the registration document, which I browsed quickly, but you I always refer to your grandfather, a remarkable man indeed, who was at the start of this whole adventure. Now I didn't read the universal registration document. But your uncle, Patrick Ricard, did something extraordinary, too. At the start in the early days, Pernod Ricard wasn't a big company. But he bought out Seagram, as you just said, who were #5 in the sector, much smaller. So you became #5. Then Allied Domecq, number two, again, on Patrick Ricard, that was quite an achievement. The great performance then was, of course, the Absolut acquisition and so on. So I'm a little surprised that you never refer to Patrick Ricard. So just a question in passing. The second thing, maybe a little more unusual. In all these videos you've shown us, they're all in English. Fine. You have American culture, and I congratulated you on that last year. But maybe you could think about the poor old folks here who did A levels here in France and who struggle with English. Admittedly, they're subtitled. All the same. There's only 1 person who spoke French in the individuals, only one. Third little thing, second last -- third and second last point. I don't understand. I mean you're not alone, but it's the first time, I'm sure there's a simple answer to this. How come -- how come your directors have the number of shares they have, which is fine. But you don't talk about your employees? You don't tell us what shares the employees have. I don't understand the rationale behind this? Why you, like other companies, don't tell us how many shares employee directors have? I presume they have some, but you don't tell us what shares they have. And fourth and final question, I don't want to hog the mic. Last year, I asked you about visiting the head office, and you replied, indeed I also received a reply in writing that I would be invited, among the first to be invited. Well, I haven't received anything. So I'm renewing my question, if I may, please. Thank you. And thank you for the quality of your management and the answers that you will have given before my questions.

Thank you for your question. Let me begin by your comment concerning my uncle, Patrick Ricard. Earlier on, when I said that we are proud of our past history, and if we are where we are today, it's thanks to all my predecessors and all the people who've been involved in building up the company. Patrick, he used to say, well, it's the teams, it's the teams. He used to say when we had new recruits at the head office, at the time, it was on a much more human scale. We're less than, if I remember correctly, 90 of us at head office. He used to take the opportunity to have lunch with each and every new recruit. And he did exactly the same with me in July 2003, when I joined head office. He -- we had a very, very enjoyable lunch together. Something he wanted to tell me just at the end of our -- towards the end of a lunch, he's telling me it's important that you understand that you're embarking on an extraordinary adventure. Adventure that is all down to remarkable people, remarkable teams. My uncle Patrick had this great belief in human beings, people. People were at the forefront of his heart at all times. But believe me, in the course of interviews, I often say this, Patrick, I'm talking in-house. Well, we have his photograph in all our subsidiaries, every single subsidiary, in our auditorium on the ground floor of The Island. It's called the Patrick Ricard auditorium. And a certain number of quotations are on the walls of our head office. Indeed, the walls of a number of our subsidiaries, too. Believe me, Patrick Ricard was a remarkable man who continues to inspire me day in, day out. We had a cocktail of our former executives. I see quite a few of them are here today. But nearly everybody who's here yesterday, where we talked once again and yet again about Patrick. Believe me, Patrick Ricard is very much on the minds of all our employees and very much in my mind, in particular. Okay. Concerning the language issue you raised. It's true that over 85% of our employees do not speak French. That's my first point, over 85%. Secondly, a certain number of employees at Pernod Ricard France do not speak French. This is how international we have become. Thirdly, 95% of our business is outside of France. So the simple solution is to add subtitles in French. You know our video on the Responsible Day, which involves 20,000 people, of whom 95% do not speak French. It's difficult to express how they live this experience in French. So we put subtitles on. Now when we film French advertisements, well, we haven't [ gotten any ] because we have a little law called the Evin law, whereby you cannot film advertising in France. So we weren't going to film videos just for the AGM. So yes, sure, we show you the Absolut ad. We have the Chinese version, if you prefer. But we do not have a French version because the French ad is a poster. And it's a poster of the way we advertise posters in France is highly regulated, too, again, by the so-called Evin law. So the content of these videos comes from abroad. And it gives you some idea of the fact that 95% of our business is outside of France. Certainly, we have some great things to show about France from time to time. But next year, we won't have any hesitations about showing you videos on initiatives taken by Pernod Ricard France. We have the Chairman and CEO and former Chairman and CEO, both present here today. As for our directors who have shares, there's no obligation to disclose how many shares they have. There's -- I don't know if they have or haven't. Indeed, I don't need to know. So as there's no duty to do so, we just tend to protect their privacy. We ask our directors to buy shares to ensure they are aligned with our interest and your interest. But if we were to do that with our employee directors, there will be 3 different barriers. So we don't have the same requirements of employees on the Board. And if I conclude with your question regarding visiting the head office. I remember that it was you who suggested the idea. I met quite a few people who came to visit head office, and it will be with great pleasure that we welcome you. And if I'm there and not abroad when you come and visit, I will come and say hello to you. But please get in touch with our people. There's the premium club in the hall outside here and then make sure you get an official invitation from them. And it will be a great pleasure to welcome you. You'll find that you will not regret it. It's well worth the trip. So there's a question from the back of the room, I think it's #4.

Thank you, Chairman. Good afternoon. You began today's Annual General Meeting by saying how attached you are to individual shareholding. Your share has exceeded the EUR 200 mark. I think it's currently about [ EUR 183 ]. Would it not be a good idea to split the share as Michelin did this year in order to make it easier to -- for a small shareholder -- individual shareholders to buy the share.

Helene, do you like to take that?

Thank you, madam, for your question. You're talking about splitting the [ nominal ] is not under consideration. The effect for impact for shareholders is neutral. We're delighted to having shareholders and so many of you here today. But our share price increase is very consistent, we believe, with I think has played a major role in our historical performance. Thank you.

Number two.

Chairman, you said how keen you were to preserve [ terroir ] as happened of Normandy, I was wondering if you have any attachment to Calvados.

Thank you for your question. There was a time -- a long time ago actually, when we had a Calvados called [ Busnel ]. But that's a long time ago. The brand is no longer in our portfolio. As things stand, we have no plans to reinvest in Calvados. A number of large categories that we are focusing on, but most recently, the tequila category, which is absolutely taking off. So it's important not to miss the boat with this category. I'm not saying we will never, but what I can say is that we have no plans at present to invest in Calvados. Question from the back of the room.

Good afternoon, Chairman. I asked if I could take the floor. Subsequent to the -- a number of people who refer to your grandfather and reference to your grandfather and uncle. To the best of my knowledge, the family owns approximately 15% of the share capital. The employees, I believe, are on about 2% of the share capital. Do you not -- are you not afraid that at a time when the LVMH, Hermes and other American companies are buying up companies for billions, have you no fear of losing your status as a somewhat family-owned company without having to acquire 50% of the share capital? Without going that far, you could well have an investor who, with 15% or 20% of the capital would, let's say, overshadow the family-owned side of the Pernod Ricard.

Thank you for your question. There are several things I could say about that. First of all, the best way to protect the share capital of the company is through strong performance and the highest possible share price. Believe me, this is what we have been focusing on day in, day out. Our success has made the group expensive, and that's important. Secondly, the -- SA Pernod Ricard, which is the referenced shareholder, the historical long-term shareholder, which supports our strategy and SA Paul Ricard, has I think 21% or 22% of the voting rights in Pernod Ricard. In fact, in the registration document, you will see that over the last year, the company had the support of the entire family, which actually acquired 1.3 billion shares in Pernod Ricard. We also have long-standing loyal shareholders, beginning with the biggest of them all after SA Pernod Ricard, which is the GBL Group, [indiscernible], who bought into the share capital back in 2006, represented by Priscilla here today. They have been supportive of us. And as far as I know, they are very glad to be on board. So that's the important thing. It's to have loyal, long-term shareholders, including you, individual shareholders, but also a high level of performance that makes Pernod group, the Pernod Ricard Group, a very enviable group, but one that isn't there for the taking. Let's move to number 3.

Good afternoon, Jean [indiscernible] from Avis, the newspaper. I represent readers who have entrusted us with proxies. You talked about the environment earlier on. Could you quantify CO2 emissions or how your group's decarbonation plan is progressing? Do you have that kind of data? Is that data available? Secondly, you didn't talk about -- well, when talking about compensation, are these considerations taken into account as a compensation criteria?

Thank you. And in fact, I have a subscription to [indiscernible]. The simple answer to your 2 questions is yes and yes. To your first question, in the registration document, beginning Page 101 to 158 of the French version. Therefore 58 pages on our CSR criteria. In fact, the first chapter is devoted to environmental considerations. We provide details of our emissions, where they come from. And most importantly, our commitments as for carbon emissions. To keep it very simple, our commitment is to reduce our scope 1 and 2 emissions. I apologize, to reduce them by 54% by 2030, also to achieve carbon neutrality, all scopes combined, by 2050. This is something we keep track of consistently regularly and which is part of the variable components of the criteria for the various compensation of our senior managers. Not just in the form of bonuses, but also in the form of performance-based shares that may or may not be attributed. Obviously, everybody is encouraged to become involved and the criteria are tracked very transparently. Have I fully answered that question? Well, we have time for one last question maybe from the front of the room.

Good afternoon, Chairman. Congratulations for your presentation. I would like to raise a question about the Evin law that you mentioned earlier on. I attended the junior sports event recently and very high levels of sports event for juniors. But I was very shocked by the fact that a major brand of alcohol had implemented a whole very elaborate strategy to encourage young people to drink. These were young people under age. I'd like to know what your position is. could you please tell us what you were doing to ensure that people under age are protected? And that the Evin law is fully abided by?

Well, frankly, I'm shocked to hear what you've just said because we have made a very firm commitment. This is, remember, the fourth pillar of our CSR strategy, which is what we call responsible consumption. Now it's very clear cut, the rule is 0 alcohol for people under age. It's 0 tolerance and 0 consumption. Let's be very simple about this. We're currently working on laws which will be on all our labels. And it will be very simple. Prohibited under 18 years of age. So our policy is very, very steadfast here. We do not market to minors. We do not sell to minors. And of course, when we organize training, I'm talking about the bar world of tomorrow, which is a training program for bar men, we make sure that they fully grasp how important it is never to serve alcohol to people under age. So from my point of view, it's crystal clear. I don't think I can be any more clear than that. Apparently, we haven't received any questions by e-mail. So thank you all for your questions. I find that very important. So thank you for giving me the opportunity to answer your questions. So I now declare the Q&A session ended. And we will now move on to the resolutions. This year, once again, you'll be voting on tablets. You will find that very simple. In fact, we have a short video to explain how these voting devices should be used. [Presentation]

Perfect. Okay. Before we move on to the resolutions, let me give you the quorum. At 2 p.m., it was 79.39%, representing 203,987,623 shares for over 8,000 shareholders present or represented. And now, I'd like to tell you that the final quorum is at 79.41%. Okay. Let's move on to the resolutions. Resolution 1. So excuse me, approval of the parent company accounts for the fiscal year ended June 30, 2022. Please vote. [Voting]

Time is up. The resolution is carried. Resolution 2, approval of the consolidated accounts for the fiscal year ended June 30, 2022. Please vote. [Voting]

Time is up. The resolution is carried. Resolution 3, appropriation of profit for the fiscal year ended on June 30, 2022, and setting of the dividend. Please vote. [Voting]

Time is up. The resolution is carried. Resolution 4, renewal of the directorship of Ms. Patricia Barbizet. Please vote. [Voting]

Resolution is carried. Resolution 5, renewal of the directorship of Mr. Ian Gallienne. Please vote. [Voting]

Resolution is carried. Resolution 6, renewal of the term of office of KPMG as full standing statutory auditor. Please vote. [Voting]

The resolution is carried. Resolution 7, nonrenewal of the term of office of Salustro Reydel as substitute statutory auditor. Please vote. [Voting]

Time is up. The resolution is carried. Resolution 8, approval of the fixed and variable components of the total compensation and benefits either granted or to be granted for fiscal 2020, 2021 to Alexandre Ricard, Chairman and CEO. Please vote. [Voting]

The resolution is carried. Resolution 9, approval of the compensation policy items applicable to Mr. Alexandre Ricard, Chairman and CEO. Please vote. [Voting]

Resolution is carried. Resolution 10, approval of the information pertaining to the compensation of the executive directors. Please vote. [Voting]

Time is up, excuse me. Time is up. The resolution is carried. Resolution 11, approval of the items of the compensation policy applicable to the executive directors. Please vote. [Voting]

Time's up. Resolution is carried. Resolution 12, authorization granted to the Board to trade in the company's shares. Please vote. [Voting]

The resolution is carried. Resolution 13, approval of the agreements under Articles 225-38 at [indiscernible] French Code de Commerce. Please vote. [Voting]

Time is up. Resolution is carried. Resolution, final resolution, powers for formalities. Please vote. [Voting]

The resolution is carried. There we are. Okay. Well, thank you so much for your attendance. Again, I would like to reiterate my confidence in our brands, our teams, our sustainable and responsible trajectory. Never has Pernod Ricard had such a bright future. Thank you for being here and supporting us. Have a great day. Since there is no more business on the agenda, I hereby close the meeting at 19 minutes past 4 p.m. Thank you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]