Estee Lauder Companies, Inc. (The)

Good morning, everyone, and welcome to day two of the UBS Global Consumer and Retail Conference here in New York City. My name is Peter Grom. I'm the U.S. Beverage and Household Products Analyst here at UBS, and we are very excited to have the Estee Lauder companies joining us this morning for our keynote. On stage with me are Fabrizio Freyda, Chief Executive Officer.

Good morning.

And Jane Hertzmark-Huddis, Executive Group President. So, Fabrizio, has been CEO for nearly 15 years. Under his leadership, the company has doubled its revenue, diversified geographically, and welcomed new brands into the portfolio and expanded its channel mix, driving the prestige beauty category's growth globally. Jane is an executive group president at the Estee Lauder Company, leading a portfolio of 10 brands, including La Mer, Tom Ford, MAC, Clinique, and others, and she also leads the enterprise-wide strategy for skincare and haircare, and has been with the company for 35 years. That's impressive. Jane and Fabrizio, we're so pleased to have you joining us today at a pivotal time for the company, where it seems like a return to sales and profit growth is on the horizon, albeit with some volatility globally impacting the broader beauty industry. In terms of format for this morning, I have a series of questions that I plan to run through with Fabrizio and Jane during the 45 minutes we have here this morning. So before we start, I am required to read a legal disclaimer. As a research analyst, I'm required to provide certain disclosures relating to the nature of my own relationship and that of UBS with any company on which I express a view on this call today. These disclosures are available at www.ubs.com slash disclosures. Alternatively, please reach out to me and I can provide them to you after the call. In addition, please refer to the slide up here being presented for the Estee Lauder Company's statement regarding forward-looking information and non-GAAP disclosures. All right. So with that, why don't we get started? So Fabrizio, maybe starting with you, there's obviously been a tremendous amount of volatility as we think about the beauty industry over the last few years coming in and out of the pandemic, and especially over the last 12 to 18 months. Has your long-term view on the growth opportunity for the beauty category changed at all in the past year? And then just given the volatility in China, Asia travel retail, how strategically important will these two historic drivers be to your long-term growth going forward? And how do you really see them evolving from where we are today?