Compagnie Financière Tradition S.A.

Good morning, everyone, and welcome to Richemont's 2025 full-year results presentation. Thank you for joining us in person in Geneva and virtually by webcast. I am Alessandra Girolami, Group Investor Relations Director, and joining me today are Johan Ruppert, Chairman, Nicolas Boss, CEO, and Burkhard Grun CFO. As usual, the company announcement and results presentation can be downloaded from richmond.com and the replay of the webcasts will be available on our website today from 3 p.m. Geneva time. Before we begin, please take note of the forward-looking statements in our ad hoc announcement and on slide two of our presentation. Turning now to the presentation, Nicolas will begin by discussing the year's highlights and group sales. Burkhardt will then review our business areas and group financials, and Nicolas will finish with some concluded remarks. The presentation will then be followed by a Q&A session open to participants present in the room. I will now hand over to Nicolas.

Thank you, Alexandra, and good morning to everyone. Thank you for joining us today. In fiscal year 25, Richemont delivered a robust performance in an uncertain macroeconomic environment, and I would like to start by warmly thanking our teams for their dedication throughout the year. Let's now go over our key numbers. Sales reached €21.4 billion, an all-time high for the group, up 4% at actual and constant exchange rates. Operating profits stood at 4.5 billion euros, down 7% compared to the prior year, or down 4%, excluding unfavorable foreign exchange movements. Profit from continuing operations at 3.8 billion euros was 1% lower than the prior year. Cash flow from operating activities amounted to 4.4 billion euros. Finally, our net cash position remained robust at 8.3 billion euros. Turning to our highlights, following a resilient first half, we saw sales performance accelerate in the second half, with a 10% rise in Q3, followed by plus 7% in Q4. Overall, sales were up 4% over the year. The Drury Maison, the group's largest business area, posted a high single-digit increase for the year, led by double-digit growth in the second half. Combined with a solid performance in fashion and accessories, this more than offset the decline seen at the specialist watchmakers. Over the year, we saw double-digit growth in all our regions, except Asia-Pacific, which remained impacted by soft demand in China. This led to the further rebalancing of our regional footprint, thereby enhancing the resilience of the group. Moving to our financial performance, we posted 4.5 billion euros of operating profit, down 7% versus the prior year. The decline in operating profit largely reflected the impact of external headwinds, including higher raw materials costs, notably gold, and unfavorable foreign exchange movements, as well as lower sales at the specialist watchmaker, weakening fixed cost absorption. Also included were 72 million euros of non-recurring charges and other one-time items that Burkhart will take you through later. Adjusted for these, the decline in operating profit was actually very limited. This overall robust performance was underpinned by a rise in operating profit during the second half thanks to the strong sales growth mentioned earlier, particularly at Jury Maison, and as a result of ongoing cost discipline. Additionally, over the year, Richemont renewed its executive leadership and governance. We have expanded and deepened the expertise of the Senior Executive Committee with the respective nominations of Catherine and Louis at the helm of our largest Maison, Van Cleef & Appels & Cartier, and of Marie Aude as our dedicated Chief People Officer. I am equally proud that, as part of our long-term succession planning, we were able to implement smooth senior management transitions at several of our Maisons. Contributing to the stability of the business, we have drawn from our top talent pool that combines both broad industry expertise and extensive group experience. With a reinforced governance and talented teams around us, I am confident that we are fully equipped to navigate the current uncertainty while continuing to build the group's future. On this note and before handing back to Burkhardt, I would like to spend a moment on how we are investing to support the business for the long term. First, we continued to selectively expand our networks, further strengthening our local anchoring in key cities and our proximity with local clienteles, for a total of 25 net new internal boutiques, including 8 from Vernier. In parallel, we pursued a targeted program of renovations, relocations and extensions across all regions and business areas, striving to offer an enhanced client experience in the best locations. In Fiscal Year 25, we dedicated close to 500 million euros to CAPEX, to our distribution network, and another 200 million to the acquisition of two real estate assets in prime locations in London. Second, we've strategically invested in our manufacturing capacity, focusing on the Drury Maison to support business growth and increase agility. Additional capacity was created for Cartier in Valenza, in Italy, New ateliers were acquired by Van Cleef & Arpels in France, and Buccellati proceeded with the integration of previously acquired workshops in Italy. In total, 400 million euros were spent on manufacturing capex during the year, a significant increase on the prior year. Overall, the vast majority of our 1,400 new colleagues recruited last year were for roles in distribution and manufacturing. Third, we continue to invest to preserve rare artisanal skills and foster young talent creativity through educational programs. To mention a few examples, over 170 apprentices are currently enrolled in our watchmaking course in Switzerland, whilst every year our Creative Academy in Milan trains 20 of the best young designers in different luxury domains and has been doing so for over 20 years. Another example is Dunhill's new craft apprenticeship program, which, in partnership with two highly regarded colleges, will help maintain expertise in traditional techniques for leather and pipe production. With its opening in Dubai this year, l'Ecole des Arts Joyeux, the school for jewelry art supported by Van Cleef & Arpels, will aim at sharing the jewelry culture and its savoir-faire to an even wider audience in the Middle East. In addition, many of our maisons contributed actively to Homo Faber, a biannual major event that brought together over 400 artisans in Venice last September. Lastly, the objective of our communication strategy is to continue building brand desirability over time. This includes our participation to the renowned annual Watches and Wonders event, where we showcase the innovation and creativity anchored in the heritage of our maisons. And it also includes relevant and impactful high-jury events, such as the Nature Sauvage, Lilo Trésor collections, and the Prince of Goldsmiths exhibition in Venice, respectively at Cartier Van Cleef & Apples and Buccellati. When it comes to communications, we make no compromise on investments needed to nurture our brands, but remain disciplined with the way we allocate them. This has helped us maintain a stable ratio of communication expenses over sales at around 10% last year. Let me now walk you through the group sales performance in more detail, first by region and then by distribution channel. Unless otherwise stated, all commands refer to year-on-year changes at constant exchange rates. All regions grew double digits over the year, with the exception of Asia-Pacific. Sales in Europe increased by double digits, with stronger growth in the second half. The performance was fueled by robust local demand and double-digit growth in tourist spending, particularly from North America and the Middle East. All channels and all main markets posted growth with notable performances in France, Italy, and Spain. Fourth quarter sales grew by 13%. Sales in Europe made up 23% of group sales, slightly up from the prior year. Asia-Pacific sales were 13% lower than the prior year, with a softer decline in the second half. The performance was largely due to a 23% decline in China, Hong Kong, and macro combined, affected by continued weak demand in the market. Excluding China, the rest of the region posted growth, led by a double-digit increase in sales for the South Korean market. Jewelry maison and online retail sales showed the highest resilience during the year, while specialist watchmakers were strongly impacted by their exposures to the Chinese clientele. Fourth quarter sales for the region were down by 7%. Sales in Asia-Pacific represented 33% of group sales, down from 40% the year before. Turning to the Americas, sales increased by 15% with growth across all business areas and channels, benefiting from robust domestic demand throughout the year. This was particularly the case in the second half, despite a mixed macroeconomic backdrop. Fourth quarter sales were up by 16%. The Americas contributed 25% of group sales, up from 22% a year earlier. Now Japan. Japan grew by 30% and posted the strongest regional increase for the third consecutive year. This was fueled by strong domestic and tourist demand, notably from mainland Chinese clients. It is worth noting that fourth quarter sales in Japan grew by 22% against a particularly challenging comparative of plus 41% in the prior year period. Japan's contribution to group sales increased by two points to 10%. In the Middle East and Africa, sales rose by 14%, with growth across all channels, driven by higher spend from both local and tourist clients. The United Arab Emirates market was a notable contributor to growth. Fourth quarter sales rose by 14%, as did sales for the full year. Sales in the Middle East and Africa region represented 9% of group sales, up one point over the previous year. Looking more broadly, all regions contributed strongly, with the exception of Asia-Pacific. The Americas grew their sales by over 700 million euros, Europe and Japan by over 400 million euros each. The strong contributions from these regions more than offset the decline in Asia-Pacific, underscoring the value of our diversified regional footprint. Let us now turn to sales by distribution channel, with growth expressed at constant exchange rates. Retail represented 70% of group sales, up by one point compared to the prior year. Retail sales increased by 6%, led by a strong performance at the jewelry maison, and double-digit increases in all regions except Asia-Pacific. Online retail contributed 6% of group sales in line with the prior year. Sales rose by 11%, benefiting from strong performance at the jewelry and fashion and accessory maisons. Regionally, Asia Pacific recorded a slight decline that was more than offset by very solid increases in all other regions. Finally, the wholesale channel represented 24% of the total, with sales down by 3%. This decline was led by specialist watchmakers and regionally by Asia Pacific, with growth in all other regions. Overall, direct-to-client sales, combining sales in directly operated stores and online, made up 76% of the group, an increase of 170 basis points versus the prior year. Of note, jewelry maison sales through directly operated stores now approached 85%. With this, I now hand over to Burkhardt, who will take you through the year's highlights by business area. Over to you, Burkhardt.

Thank you, Nicolas. I will now review the business areas with all comparisons at actual rates unless otherwise specified. Let me start with the jewelry maisons, which include Buccellati, Cartier, Van Cleef & Arpels, and Vernier now being consolidated from October of last year onwards. Sales were up by 8% for the year to 15.3 billion euros. All regions grew double digits except for Asia Pacific, led by robust direct-to-client sales. The second half experienced faster growth, with a remarkable 14% growth in the third quarter, followed by 11% in the fourth quarter, all at constant rates. The Julie Misons generated an operating result of 4.9 billion euros, up by 4%, or by 6% at constant rates compared to the prior year. Higher sales, notably in the second half, combined with disciplined operating costs and targeted price increases, helped mitigate the impact of higher raw material costs, particularly gold. In addition, as Nicolas detailed earlier, we continue to invest in distribution and manufacturing capacity to support the long-term growth of the Maisons. Operating margin remained very solid at close to 32%. Let us now look at the key developments of the year. Sales growth was fueled by the Maisons' iconic jewelry and watch collections. Those notably included strong performances from the Pantera and Trinity collections at Cartier, the Alhambra and Perle lines at Van Cleef & Arpels, and Macri at Bucciarati. Several novelties were launched across collections, like the Love Medium and Hinge, and Juste un Clou in white gold at Cartier, Frivol rose gold and Perle diamonds at Van Cleef & Arpels, and several opera tulle and blossoms editions at Bucciarati. And complementing our leading maisons, we are happy to welcome the Italian Jewelry Maison Vernier, which brings its distinctive savoir-faire and innovative design-driven jewelry to the group. Our high jewelry collections have continued to showcase their creativity and quality craftsmanship, nurturing desirability through the launch of, Nicolas mentioned it, Nature Sauvage et Quartier, and the Lilo Trésor collection at Van Cleef & Arpels. Our maisons continue to upgrade and expand their store network. Major reopenings at Cartier took place in the Dubai Mall in the UAE and at South Coast Plaza in the U.S. New addresses and prime locations included Amsterdam and Madison Avenue in New York for Van Cleef & Arpels and Sayowool Coex and a flagship store in Riyadh for Bucciarati. Let us now turn to specialist watchmakers, where sales were down 13% at both constant and actual rates to now 3.3 billion euros. The overall decline was reflective of the performance in Asia Pacific, the specialist watchmaker's largest region, where sales were 27% lower than the prior year. This was primarily driven by weak demand in China, Hong Kong, and Macau combined. Excluding China, specialist watchmaker sales were stable at constant rates and 1% down at actual rates. The Americas and Japan both showed solid growth, while sales in Europe and the Middle East and Africa were largely stable. It is worth noting the softer rate of decline in the second half at minus 9%, mainly owing to double-digit growth in the Americas. This included a fourth quarter at minus 10 at actual rates and at minus 11 at constant rates, partly impacted by targeted buybacks in mainland China. The operating result of the business error declined to 175 million euros. While the Maison's demonstrated discipline on operating expenses, notably in communication, the decline in sales had a significant deleveraging impact on both production and fixed operating costs. In addition, the continuously strengthening Swiss franc weighed on the operating results, as most of the Maison's production and headquarters are located in Switzerland. Overall, the operating margin reached 5.3% for the year. Specialist watchmaker Maison saw a varied performance depending on the individual regional exposure and product mix. Alain Enzeune and Vacheron Constantin showed the most resilience over the course of the year. In a context of fluctuating demand, our maisons have continued to closely monitor the inventory in the trade and managed to retain an overall balanced sell-in, sell-out ratio of 100%. The maisons have remained true to their distinctive DNA by launching novelties inspired by heritage and fueled by innovation. An example of this has been the new historic 222 timepiece of Vacheron Constantin, created in stainless steel, marking the start of its 270th anniversary celebration. Specialist watchmakers continue to improve the distribution network through targeted new points of sale and renovations across regions. To name but a few, IWC opened flagship stores in Paris and New York, and Piaget renovated several stores under their new concept in Asia and the Middle East. At the same time, Panerai optimized its footprint in Asia Pacific, mainly in China, with the closure of four internal boutiques. Lastly, targeted efforts were made to elevate client engagements, supported by strong events. Those included the Erlangen-Zöhne sponsorship of the Concours d'Elegance, bringing together automobile and watch enthusiasts, and Jaeger-LeCoultre's Precision Pioneer exhibition, which welcomed visitors to an immersive experience in watchmaking craftsmanship. Let us now move to the other business area, comprising the group's fashion and accessories maisons, watch find and go, the group's watch component, manufacturing, and real estate activities. Sales reached 2.8 billion euros for the year, up 7% at both actual and constant exchange rates, underpinned by faster growth in the second half. All regions grew, other than Asia-Pacific, with notably double-digit performances in the Americas, Europe, and the Middle East and Africa. All channels saw their sales increase, with online retail growing the most. Overall, the other business area reported an operating loss for the year of 102 million euros, resulting in an operating margin of minus 3.7%. Excluding targeted inventory provisioning, fashion and accessories maisons posted a minus 2% operating margin in line with the first half. The Maisons continue to invest in their desirability and visibility, as well as in an e-commerce solution replatforming, triggered by the YNAB sales process. Going into the business highlights, I will start with Alaia, which recorded another year of strong growth, particularly in leather goods, with the success of products such as the Tackle Bag and La Ballerine shoes. Similarly, Peter Millar saw its solid momentum continue. Overall, ready-to-wear sales rose by double digits across the maisons, which is an encouraging performance at Chloé. More broadly, the recent collections showed continued designer creativity across product categories, leading to increased desirability. Gianvito Rossi, our Italian luxury shoemaker, celebrated their first anniversary with us in February with a very encouraging performance. Watchfinder enjoyed solid growth and continued its collaboration with the other maisons, with the launch of a certified pre-owned program with Vacheron Constantin. Select expansions of the retail network notably included the new flagship stores for Alaya in Paris, Paris, Rue du Faubourg Saint-Honoré, and for Montblanc in Chengdu. G4 opened several new stores, of which one in Los Angeles, while Gianvito Rossi relocated the New York Boutique to a prime location on Madison Avenue. Let me now walk you through the rest of the P&L, starting with the gross profit. Gross profit rose by 2% in absolute terms to 14.3 billion euros, but declined as a percentage of sales by 120 basis points to 66.9%. The main impact came from higher production costs owing to raw material cost increases, notably for gold. We also made the decision to proceed with targeted buybacks in mainland China at two specialist watchmaker maisons, as well as stock provisioning and fashion and accessories, further impacting the gross margin. These adverse effects were partly mitigated by the positive effects of targeted price increases, as well as beneficial channel and product mix. In addition, unfavorable foreign exchange movements, mainly from the Japanese yen, Chinese renminbi, and Swiss franc, amounted to a 35 basis point negative impact. Excluding foreign exchange rates movements, gross margin was down 80 basis points for the year. Now let's look at the operating expenses, which were 7% higher than the prior year, reflecting our continued investments in the business while being disciplined on costs. I will now take you through the expenses by category. First, selling and distribution expenses increased by 7% at actual rates, accounting for 26.3% of sales. This was a 90 basis point rise compared to the prior year, mainly due to the next word expansion of fiscal year 24 and 25, as well as salary increases. Communication expenses rose by 4% compared to the prior year. Despite the phasing impact of the annual Watches and Wonders event, communication costs remained stable as a percentage of sales at 9.8%. Administrative and other expenses rose by 7% and represented 9.9% of group sales. The increase was driven by higher salary costs, valuation adjustments on acquisitions, and the impact from a strong Swiss franc. Also included were 72 million euros of non-recurring charges, mainly related to provisions for legal disputes and impairments of goodwill. Overall, net operating expenses amounted to 46% of group sales. This resulted in an operating profit of 4.6, sorry, 4.5 billion euros, down by 7% at actual exchange rates and by 4% at constant exchange rates. Excluding the 72 million euros of non-recurring charges that I mentioned earlier, in addition to targeted inventory provisioning and buybacks, the underlying operating profit was very robust at 4.6 billion euros, down only 2% at constant exchange rates. It is worth noting that operating profit in the second half was up versus the prior year period, led by strong performance at the jewelry maisons and healthy cost discipline. Let us now review the rest of the profit and loss items below the operating profit line, starting with finance costs. Net finance costs improved to 53 million euros for the year from 178 million euros a year earlier. This 125 million euro improvement was the result of two main items that partly offset each other. First, a favorable change of fair value adjustments, accounting for 396 million euros, reflecting gains on the group's investments in externally managed bond and money market funds. And secondly, the non-recurrence of the write-down of the Farfetch convertible note. Second element, a 258 million euro negative evolution of the contribution of our foreign exchange hedging program. Turning now to discontinued operations, which consist of YNAB. Sales were down by 13% at actual rates and by 14% at constant rates. The loss for the year at one billion euros largely reflected the 954 million euro write-down of the carrying value of YNAB assets in the context of the sale to MyTheresa. This was an improvement compared to the 1.3 billion euros communicated at our first half results, partly reflecting the evolution of MyTheresa's share price since then. Let me take this opportunity to say a few words on YNAB. As you know, the transaction closed a bit less than a month ago on the 23rd of April. As agreed in the terms of the transaction, Richemont received a 33% stake in the newly created Lux Experience, corresponding to 49.7 million shares of MyTheresa or Lux Experience. YNAB was left with a net cash position of 555 million euros, implying a 426 million euro cash out for Richemont. The group granted a six-year RCF to YNAB for 100 million euros. Fiscal 26 interim results will include the final result on disposal, as well as customary post-closing price adjustments, and YNAB will be deconsolidated from the closing date. We truly believe that this transaction will offer an excellent future for YNAB, with Lux Experience set to become one of the leading global digital luxury platforms. Now returning to our fiscal 25 results, let's review the profit for the year. Profit from continuing operations stood at 3.8 billion euros, down 1% versus the prior year. This included the improvement in net finance costs that I just described, a higher share of equity accounted contributions, and a lower tax impact. The group's effective tax rate for the year was 16.5%, lower than we had anticipated, mostly driven by non-cash accounting items. Overall, and after taking into account reduced losses from discontinued operations, profit for the year rose by 17% to 2.8 billion euros. Cash flow generated from operating activities came in at 4.4 billion euros, down 253 million euros. This 5% decrease mostly reflected the evolution of the operating profit from continuing operations, slightly higher cash taxes, and a marginal change in working capital requirements, partly mitigated by reduced operating loss from discontinued operations. Let us now turn to gross capital expenditure, which amounted to 1.2 billion euros, up 16% versus the prior year. The investments in our distribution network represented 41% of gross capital expenditure and were largely dedicated to the upgrade and extension of the internal boutique network. Manufacturing accounted for over a third of our investments, a strong increase versus the prior year with the expansion of our Julie Maison's capacity, primarily in France, Switzerland, and Italy. Other investments, including IT, made up 24% of CapEx. Overall, CapEx represented 5% of sales, up from 4.4% in the prior year, mainly due to the increased investment in manufacturing capacity that I have just mentioned. Now to the review of free cash flow. At 2.2 billion euros, free cash flow was 0.6 billion euros lower than in the prior year. 40% of the reduction, that is to say about 253 million euros, came from the cash flow from operating activities that I described earlier. The remainder mainly came from high investment in our operations, combining a 153 million euro increase in capex with a 187 million euros outlay for select real estate investments that Nicola mentioned earlier. Our balance sheet remained very solid, with shareholders' equity accounting for 54% of the total. Net cash amounted to 8.3 billion euros at the year end, an increase of 0.8 billion euros over the prior year. Let me now finish with the dividends. The board has proposed a dividend of three Swiss francs for one A share or 10 B shares, which represents a 9% increase of the ordinary dividend over the prior year. This will be submitted for shareholders approval at the group's annual general meeting on the 10th of September, 2025. So thank you for your attention and I now hand over to Nicola for the conclusion.