Beiersdorf Ag

Thank you, Sasha. Good morning, and welcome to Biosdorf's third quarter conference call. Thank you for joining us at such an early hour. This is Christopher Sheldon, and I'm here with our CEO, Vincent Vanery, as well as our CFO, Astrid Herrmann. We would like to share with you Biosdorf's sales performance for the first nine months of 2024. We will start with a presentation and the business review, followed by a Q&A session. And with that, I'd like to hand over to Vincent.

Thank you, Christopher, and good morning. Welcome to today's conference call. Astrid and I will now guide you through our financial figures at group and brand level regarding our nine-month NQ3 performance before we then share an outlook for the coming months. At the end, we'll open the floor for your questions. In the first nine months of 2024, BuysOff continued to deliver strong growth and achieved an organic sales increase of plus 6.5% at group level. Given the current market dynamics, this steady performance is in line with our expectations and reaffirms our confidence in our guidance for the full year. Our consumer sales grew by 7.3%, while Teza delivered 3.1% of growth. Our Icon Nivea continued its outstanding performance around the globe throughout the year and grew by 9.4%. Our key categories performed well, and this broad-based success was further driven by growth in all key regions. For Dermabranche, Eucerin, and Aquaphor achieved very strong organic sales growth of 8.8% in the first three quarters, despite a very high comparison based in 2023 and the unfavorable impact of Argentina. In the third quarter, this was powered by double-digit growth on a global level, an outstanding resurgence performance in North America, and the successful launch of our breakthrough anti-aging innovation, EpiCellin. The healthcare business, which comprises the Onzaplast and Elastoplast plaster brands, reported substantial sales growth of 5.1%. Tales of La Prairie, declined by 7.3% in organic terms in the first three quarters. This decrease was mainly driven by the continued weakness of the greater China ecosystem and its negative impact on the travel retail market. In this demanding environment, La Prairie again managed to outperform the market and gain significant market share. Now let us zoom on the third quarter performance of a consumer business. I will share an update on our reinvigorated North America business, the double-digit sales growth of Eucerin and Aquaphor, and the ongoing strong performance of our global icon Nivea. These positive results are even more noteworthy given the very high comparison base from last year. In the third quarter of 2023, we achieved outstanding sales growth with our Nivea and our Derma businesses and recorded one of the strongest quarters ever for Nivea in Europe. Our focus on skin care continues to pay off. All these, guided by our win-with-care strategy and paired with a strong outlook and exciting innovation pipeline, fuels our confidence in our full-year guidance. In North America, like many of our peers, we experienced a challenging first half of the year. I'm delighted to now report that our North America business regained its strength and achieved fantastic double-digit growth of 11.1% between July and September. Both our U.S. and Canadian businesses delivered a double-digit performance. Especially, our Derma brands contributed to these results with an impressive growth rate of 19.6% in the U.S. in the third quarter. Nivea also further increased its growth momentum throughout the year. In North America, a key market in our wind with care strategy, we continue to expand our brand presence, which is visible both in sales growth and market share. In the third quarter, Aquaphor continued its stellar performance and grew by 16% in organic terms. Usurin contributed strongly as well with a recently launched face care range, further gaining momentum. It has already been successfully rolled out at major retailers such as Amazon, Walgreens, CVS, Target, and Kroger. As we look ahead to the next year, we are excited about the upcoming launch of our Usuin Tiamidol product range in North America, which has tremendous economic potential for this key region. Now to our icon. Nivea delivered impressive growth of 9.4% year-to-date, outperforming key competitors in the market. This confirms that we are fully on track to reach our target for the full year. Sales in both the skincare and personal care categories increased significantly. In addition to the face care and sun businesses, the categories body care and they all performed particularly well. This broad-based success was driven by continued double digit sales growth in emerging markets with all other key regions growing as well. Nivea continued its strong organic growth in Q3 with 5.9% compared to an exceptional Q3 in 2023. Last year's Q3 saw record growth in Western Europe on the back of a double-digit price increase in a high inflationary environment and a catch-up effect following customer sanctions. Looking ahead, we are very excited about our strong innovation pipeline for Nivea. In addition to the ongoing sustainable product transformation, 2025 will be the year with the strongest launch and relaunch pipeline in the history of Nivea. We'll further leverage the success of our Luminous 630 franchise, introduce our epigenetics innovation to Nivea, and enter the market with several other products. Over 45% of our Nivea sales in 2025 will be impacted by these innovations and renovations. This pipeline and well-balanced growth via price and volume makes us confident that we will be able to continue our strong growth on Nivea for the remainder of this year and beyond. Following the consistent strategic globalization and digitalization of our iconic brand in recent years, Nivea's power, its global presence, trusted brand name, and continued development form an extremely robust, crisis-resistant, and dependable pillar of our business. Moving on to our derma business, I'm pleased to share that our derma brands returned to double-jit growth of 10% in the third quarter, significantly ahead of competition. This increase was primarily driven by the success of the North America business, where our derma sales grew by 19.6%. from a global category perspective, particularly using face care and body care, perform strongly. Looking at the first three quarters in total, we are very pleased with the organic sales growth of 8.8%, especially given the very high comparison base in 2023 and the unfavorable effect of Argentina. Our highly successful Tiamido range remains a key driver here and is still showing fantastic growth rates five years after its launch. Face care, as well as double-digit growth in Suncare and Aquaphor, contributed to this outstanding nine-month performance. Given our strong derma innovation pipeline and expansion plans, you remain confident for the full year and 2025. We launched Eucerin in India just last week. We'll further expand the Tiamidol product range around the globe. We'll continue our Eucerin face care rollout in the U.S., and we'll further accelerate the rollout of a breakthrough anti-aging innovation, EpiCellin. Now let's take a closer look at the launch EpiCellin, which we presented to you at the Capital Markets Day. In our H1 call, I stated that we aim to make this our biggest launch ever and already predicted that it will have a strong business impact. And I would like to say I did not exaggerate. Since the launch of EpiCellin in September, We are now present across Europe in some emerging market countries, a total of 32 countries. We have already reached over 80% of our anticipated global sales forecast for 2024. These fantastic first results are above our ambitious plan. For instance, in our key market Germany, the Eucerin Epigenetic Serum is already the number one bestseller in the entire dermocosmetic market. It also holds number one anti-aging positions in countries such as the UK, Belgium, Spain, Austria, and Chile. I cannot wait to talk to you again about the further launch of this groundbreaking innovation in our full-year results call in February. Now to the sales of our luxury brand, La Prairie. La Prairie sales declined by 8% in the third quarter. Throughout 2024, this decrease was mainly driven by the continued weakness of the greater China ecosystem, both in mainland China and in Hainan, and its subsequent negative impact on the travel retail market. This strongly impacts consumption and then also affects the luxury skincare market and how La Prairie sells. With the Chinese luxury and travel retail market down in the third quarter, La Prairie managed to outperform in this challenging environment and gain market shares in most geographies, namely China, brick and mortar, and online, the U.S., travel retail, and Japan. We remain cautious in the short-term outlook, but continue to see China as a key opportunity for La Prairie to generate growth in the medium and long term. Having said this, I would also like to point out that buyers' exposure to luxury in China today is rather limited. Different to our competitors, we believe to generate between 10% and 30% of their sales with luxury in China, we are well below 5%. Our focus with La Prairie continues to be on gaining market shares as proven in previous quarters. The key for La Prairie's success is a focus on breakthrough innovations such as the premium price La Prairie's New Life Matrix Oat Rejuvenation Cream. This cream encapsulates the alliance with Clinique La Prairie, the legendary Swiss longevity clinic. It was launched in September and shows encouraging first sales results in China and other markets. At the same time, we bring entry-level products such as the skin caviar mix to the market, which we successfully introduced in the first half of 2024. These two products are only two examples of our expanding product range, thereby recruiting new and younger consumers with entry-level propositions into the brand, whilst also offering high-end innovations at a premium price to existing consumers. We're also changing the look and feel of our point of sale, the way we communicate online and offline, and we are modernizing our brand image. Now to the performance of Chantecaille. I'm pleased to share that we have been able to continue the brand's growth trajectory and retain our momentum throughout the year. Following organic sales growth of 4.4% in the first half of 2024, we increased our sales by 4.9%, in the third quarter. Key contributors were Shantuka's expansion through retail and the launch in mainland China. Our strategy for Shantuka in China to focus on digital channels first paid off. The partnership with China leading e-commerce platform Tmall and our collaboration with the Chinese celebrity Beilu created a perfect environment for the domestic launch. This was followed by a commercial pop-up experience in Shanghai evolving the famous actress, singer, and model. At the results, Chantecaille was ranked the number six most influential international boutique brand in China in September. The financial results of this orchestrated launch fill us with great confidence. After this summary across our brand's portfolio, now over to you, D'Astrid.

Thank you so much, Vincent. Thank you so much, Vincent. Let's begin with the sales development at the segment and group levels. In the first three quarters, Biosurf Consumer Division recorded organic sales growth of plus 7.3%. Due to negative foreign exchange effects, nominal sales growth amounted to plus 4.4%. Arteza Division concluded the same period with organic sales growth of plus 3.1% or plus 2.2% in nominal terms. Together, this results in plus 6.5% organic sales growth for the group, or plus 4.0% nominal growth. Following an excellent first half in 2024, our consumer division has continued to deliver strong growth in the third quarter, further enhancing last year's remarkable achievements amidst the ongoing challenges in the luxury markets. While our third quarter experienced a slight moderation due to the significant price increases in the third quarter last year, we are fully on track and confident to deliver our full year guidance. Let's review the performance of our brands within the consumer segment. Vincent has already provided details on the year-to-date development, so I will focus on the performance for the third quarter. Nivea continued to achieve strong growth of plus 5.9%, even on the back of an exceptional performance in the third quarter last year. As Vincent alluded, to earlier, it was a record quarter for Nevaeh in Europe. The plus 5.9% growth this quarter is fully in line with our expectations for the full year. The growth was widespread across all key regions with a well-balanced contribution from both price and volume. Both our skincare and personal care categories contributed to the success. We are excited to announce that Derma returned to impressive double-digit growth of 10% in Q3, an outstanding achievement, especially in light of last year's exceptional performance. This strong growth rebound can be attributed to the remarkable progress of our derma business in the U.S., as well as the successful introduction of our epigenetics line. Both Userin and Aquaphor have surpassed market performance in terms of both revenue and market share. Our healthcare division achieved remarkable growth of plus 7.7%, significantly outpacing the market and strengthening our leading position. Key growth drivers included our top markets, Germany, Australia, Indonesia, and particularly the UK, which delivered an exceptional quarter. Even though the situation for La Prairie and the luxury market in China continues to be difficult, the strong performance of our other brands helped to more than offset these temporary setbacks. As a result, our consumer business achieved growth of plus 5.7%, reinforcing our confidence in delivering our full-year guidance. Similarly, our TESA business reported solid growth of plus 3.5% in the third quarter, despite the increasing headwinds across its key sectors. At the group level, we are pleased to report sales growth of plus 5.3%, I will now move on to the consumer sales performance by region. At the regional level, all regions and sub-regions were on a growth trajectory in the first nine months. Europe experienced a growth of plus 5.2% in the first nine months, aligning well with our expectations. Following an exceptional performance and notable price increases in Western Europe during the third quarter of the previous year, we are very pleased with these results. it's important to note that these figures also count for the ongoing slower performance in China's travel retail sector, which is reflected in Western Europe's results. Meanwhile, Eastern Europe continues to demonstrate ongoing double-digit growth. After a brief slowdown in our North American business, we returned to double-digit growth in the third quarter, turning our year-to-date performance positive once again. Latin America remains robust despite the well-known challenges in Argentina, with Nivea gaining momentum and Derma achieving outstanding results in Brazil, consistently accelerating quarter after quarter from a strong base. The Africa-Asia-Australia region also achieved impressive double-digit growth in the first nine months, despite the ongoing challenges in the Asian luxury market. Nivea was a key driver of this growth in Africa and the Middle East. I'm pleased to share that TESA has achieved an organic revenue growth of plus 3.1% in the first nine months and plus 3.5% in Q3. This growth was primarily driven by Asia and positive developments in our electronics and printing and packaging solution sectors. TESA is facing a challenging environment in both the industry and consumer segments. The automotive industry has been suffering lately, especially in Europe and in the area of e-mobility. As already announced at our H1 results in August, the electronics business saw exceptional growth in Q2, which was mainly driven by positive phasing effects of sales shifting from Q3 and Q4 to Q2. Teza's consumer business is experiencing lower traffic in DIY stores driven by cautious consumer sentiments across Europe. Nevertheless, Teza has been able to demonstrate solid growth figures despite these headwinds and continues to gain market shares. As a result, we remain cautiously optimistic for Tezos growth in a challenging market environment for Q4 and confirm our guidance. Over to you, Vincent.

Thank you, Astrid. So given the dynamic market environment, buyers of performance and sales results in the first nine months of the year are fully in line with our expectations. Therefore, we once again confirm our sales and EBIT guidance for the full year 2024. We expect organic sales growth in a range of 6 to 8 percent in the consumer business segment. The EBIT margin, excluding special factors in the consumer business segment, is expected to be 50 basis points above the previous year's level. We expect sales growth above the market in the TESA business segment, which translates into anticipated organic sales growth in a range of 2 to 5 percent. The EBIT margin, excluding special factors, is expected to be at the level of the previous years. Based on the forecast of the two business segments, group organic sales growth is expected to be in the range of 6% to 8%. BioServe anticipates the consolidated EBIT margin, excluding special factors, to be slightly above the previous year level. Thank you very much for your interest in BioServe financial performance from January to September 2024. Astrid and I are now looking forward to your questions. To start the Q&A session, I will now hand over to Christopher.

Thank you, Vincent. You will now have the opportunity to ask questions. If you wish to ask a question, please press star 1 on your telephone. And please remember that we have a maximum of two questions per caller. And the first one in line is Ian Simpson from Barclays. Ian, please go ahead. Your line is open.

Thank you very much. A couple of questions from me please. I wondered if you could talk a little bit more about what Suncare did in the Q3 and whether that was a tailwind or a headwind to Nivea and Derma and just give us a little bit more colour as to both market and your performance in that category. And then my second question is that you called out a few times that you had a very tough comp in Q3. It looks like the comp gets a fair bit easier in Q4. And I noticed the sort of references to a strong Q4. I just wondered how we should think about the phasing of your overall growth in consumer as we go into the end of the year. Thank you very much.

So, Yann, on your first question, we add, you know, The Suncare, in fact, evolved positively in the first semester. If you remember, we grew double-digit. And because also the Sun season was not so good in the summer, we had a negative quarter. The good news is that we were able to manage extremely well our stocks. They are taken into account in both Q2 and Q3. And at the end of the nine months, we are growing double-digit on E3 and Sun, and we are growing high single-digit on EVS and Sun. So it will be a good year for us, despite... you know, a third quarter below expectation. On the comparative, I mean, you're right to mention that. You know, just to remind you what happened last year, and last year we had a... something like a 12% price increase in Europe. We grew in countries like France and Germany by 24% because of the price increase and also because we're back on shelf in some major retailers. They listed us because of the price increase. So this kind of comparative was obviously very strong in Q3. And you are right to mention that normally the Q4 is more favorable in terms of comparative. This is why we are optimistic for the fourth quarter.

Thank you very much. And the next one in line is Celine Panotti from J.P. Morgan. Celine, please go ahead. Your line is open.

Yes, good morning. I'm sorry, I may have missed your previous question, but I first start with the strong growth that you have had in the U.S., and you mentioned DERMA growing double-digit. Obviously, one of your competitors has been seeing some destructing in the in the U.S. and in Denmark. So I just want to understand what has driven that strong double-digit? Was it really you widening your distribution? Can you talk about what the sell-out growth is and whether you're happy with your level of inventory and what should we expect in terms of run rate as we look in the fourth quarter and your view on the growth for the derma market globally as we look into maybe 2025. And then I think you were just answering the question about Q4 re-acceleration. I think you said strong, easy comparative. I mean, could you, unless you've done it, but could you give us a steer on whether you're still very happy to be at the top end of that 6 to 8 bracket? Thank you.

to uh celine i think the the as you heard you know a few days ago obviously the u.s market has slowed down over the last three months and both in the mass market and the derma market this did not prevent us from achieving the the 19.6 percent growth that that you you saw in the quarter what is i think very positive for us it's not only we have our legacy business aqua 4 growing 60 percent but when you look at your serene we grow 26 percent and this is not only driven by the very good health of the body business. We are gaining market share, by the way, on both Aquaphor and Usurin in the body market, and this is extremely positive. But also the success, this is the second year of Usurin Sun that we launched two years ago, and the new kid on the blog, the launch of Usurin Face, We managed to have also target listing USUINFACE in the third quarter. This is extremely important for us. So if you put all three businesses, we are not only growing very strongly in selling, but we are also gaining a market share on both Nivea, USUIN and Aquaphor. So this is making us... optimistic not only for the derma us business in the fourth quarter but also overall for the derma global business because on top of that we benefit from the effect of epicellin which will be fully fully leveraged in the fourth quarter regarding your question about the q4 as i mentioned as an answer to yan is true that on europe we have a easier comparative because again in q3 2023 we had an exceptional growth due to price increase and the and the fact that we are back on shelf in France and Germany with many retailers. So we are optimistic for Q4. This is why, as I said last time and I said, I think, even six months ago, I would be disappointed if we were not reaching the upper level of the guidance for consumers in 2024.

All right. Can I just ask a follow-up on epicillin? Any indication you can give us in terms of sales that you expect for this year? And I think you did say in a previous call that you were expecting epithelial launch to be four to five times as successful as Tiamidol in the first year. Do you still track there or do you think it could be even better?

But you know, we take the first step of this launch, which is selene. And we will clearly oversell episeline versus thiamidone and even versus the figure I gave you last time. So very happy with the selene. Obviously, what is important is the sellout. I gave you the figures of Germany and a few European countries. Even I heard this morning that in France, this is the highest ever sell-out level we had on the brand history in France. So all sell-out figures are pretty optimistic. That second tick, I would say, is positive. The third tick will be obviously the repurchase. which will happen in the first quarter. We had extraordinary test results, you know, when we tested the product, so we are pretty confident that it will be, I would say, really the moment of truth in the first quarter of 2025. Are, you know, all those people who bought the product once willing to rebuy the product? And that will be the moment when we can be even more clear on the fact that this is really a breakthrough innovation, and I hope, you know, the best ever launch of Biosoft.

Thank you.

Thank you. And the next question comes from Karel at Kepler. Karel, please go ahead. Your line is open.

Yes, good morning. Thanks for taking the question. I have a question on the La Prairie business. Can you tell a bit more on the innovations you're launching here at lower price point? Is it already addressing different consumers or is that a tempting offer for new ones? And the other thing is in general it feels that your innovation agenda for the portfolio Nivea and Usuin is very, very heavy. going into 2025. Can you tell a bit more how you plan to face and support this all? Thank you.

First question, I think we are really trying to have a much wider approach. And I think the two launches I'm mentioning are good examples of that. On the one hand, You have the La Prairie Matrix, you know, the Matrix Oat Regeneration Green. We are selling the product at €2,000. So obviously the most expensive product we ever launched at La Prairie. And it's very interesting when you look at the first results. You see that we are able to have 20% of the consumers in China are, in fact, either new or they used to be consumers and coming back, 20%, which is a very good figure. But on top of that, you have 70% of the people buying this product who are also buying another product. And that's really good because this is exactly what we want to do with the VVIP, what we call the millionaires. willing to to be loyal to the brand and to benefit from the the best innovation on the other hand we're coming with a mist which is sold at 170 euro so obviously an entry price for la prairie which is allowing us to recruit we had 80 percent of the people buying the product which are new to the brand we made a huge success on tmall tiktok doing and and jd and that's obviously the way we want to develop the brand so i think every time this this uh combination of extremely ambitious and high-priced innovation and also being able to have consumers trying the product for the cheaper price. So far so good and we hope to see some good launches in the year to come. On your second question, we are extremely happy with the plan for 2025 on all brands. The interesting thing is that we used to be relying only on launches, and that's great to have launches, but we have also a core business which needs to be animated, and we have transformed dramatically the way we look at our core portfolio. We are able, for example, next year to relaunch our body line, and Nivea Body is one of the biggest businesses for Nivea. We are relaunching our black and white deodorant line. So we are really animating, as I said, 45% of the portfolio in order to be sure that we are bringing new news to the consumers on each and every category. We have phased the plan in a way that we are able to have every quarter the right support plan, and we are going more and more into digital, into influencer marketing. So not only to be able to support every quarter the right number of products, but also to be able to have a much more sustainability of the launch plan and not launching something and then moving to something else. This is why you see some kind of optimism on our brands. Thank you.

Yes, clear. Thanks. The next one in line is Victoria Petra from Bank of America. Vika, please go ahead. Your line is open.

Okay. Thank you very much for the comments. When you were providing guidance in the beginning of the year, I assume your expectations on La Prairie were very different from what we're seeing in the nine months and in the third quarter, yet you're keeping your margin targets unchanged. What are the offsetting factors while you're still in line despite the dilutive impact on La Prairie? And my second question is a little bit of a follow-up on Celine's question on derma. How is your underlying market growing? Because we see very different results on dermatological beauty from various players, and everyone is saying they're gaining market share. What is different? How do you define this market for you? Is it outside of moisturizing? Is there anything specific apart from... user and face launch in the US. Thank you so much.

Victoria, Astrid will take the first question. I will take the second one.

Yes, thank you so much for your question in terms of margin targets. You are right. Obviously, our LaParis business is a profitable business, adding significantly to our delivery. That said, we also have other businesses that are very, very profitable. We're particularly happy with a very, very strong delivery of our European business, which has been able to really help us offset the significant headwinds in luxury. Additionally, we've really worked on managing our costs through value engineering initiatives, obviously through buying at the best cost we can, and we've managed our overheads very, very tightly while continuing to invest quite heavily in marketing budgets. we've been able to really compensate the headwinds through all these activities I just mentioned.

On the second question, Victoria, what we are seeing, obviously, is a normalized derma market, which I think we're expecting. So if you look at North America, the market is growing at 3%. If you look at Europe, you are more into the 7%. So healthy market, but no more the 10%, 15% we had in the past. I think what is happening, and it's obviously a great opportunity for a company like us, You have this magic triangle. On the one hand, you have the pharmacies or the drugstores, and this is clearly a retail environment which is extremely favorable for derma brands. On the second part, you have the dermatologists, could be also the derma influencers. This is really a trend which is developing. So the prescription, the recommendation is important. And the third thing, which is the most important one, there's a premium for companies coming with innovation. When you come with thiaminol, there is no anti-spot market, but you create a market. When you come with epigenetics, you might enter a red ocean market, but you have a great opportunity to come with a new offer, endorsed by dermatologists. We saw that in the big derma conference in Amsterdam, that we can sell at a nice price. So the good thing in this market is it's clearly a market where... you need to have not only the strength of a dermatologist network, of a strong retail network, but also to be endorsed as innovators. And this is why a company like BioSurf, which has been the first company entering derma, more than 80 years ago, as a strong asset, and this is what you see today. So innovation is coming. Epizidine is spreading across the world. Tiamidol is coming already to the U.S., and as you know, I'm working also on expanding that to China. So all of that is making us believe that more than ever, Derma will be a growth driver for 2025 and onwards.

Maybe just on that, a very quick follow-up on the China licensing on TME Dole. Where do we stand? When should we expect the first kind of sales launch in China outside of cross-border online?

Yeah, Victoria, we are progressing. I'm even myself flying to China in one week. We are progressing. We have some questions we answer. The plan we have, the hope we have, that we'll get regulatory approval in the coming weeks. And then we have one year to develop the formula and get the regulatory approval of the formula, which should be easier as soon as the ingredient is approved, which means a launch for 2026. And when we get the regulatory approval, we will, of course, cascade the ingredient, not only on Nivea Yusrin, but also La Prairie and Chantecaille.

Thank you very much.

And the next question is from Rogerio Fujimori from Stiefel.

Please go ahead.

Your line is open.

Thank you. Good morning, everyone. I have a follow-up on La Prairie. I was wondering if you could break down your minus 8% like-for-like in Q3 in the Chinese ecosystem and outside China, and also help us to think about Q4 in China and Asia travel retail, considering trade stock levels at the end of Q3 and Golden Week trading. And then finally, just curious to hear how you're protecting the brand against parallel trading risks in China, flagged by one of your luxury peers. Thank you.

Thank you, Roger. I mean, if you look at the performance of Rapry, obviously, china is impacting us and not only china brick and mortar but also china travel retail you know we are getting market share but when you are in the for example brick and mortar china the market is as minus 20 percent we are gaining market share but we are at minus 15. so it remains negative when you look at ainan the market is as minus 35 percent we are doing minus 25 percent we are better but still you know losing a business and and not not growing in this market what is positive i would say regarding la prairie is that we are not only growing strongly, for example, on e-commerce. You know, if you look at e-commerce, China, it's flattish. We are expecting double 11, but it's flattish. We are growing at plus 30 percent. We opened doing TikTok last year. We see also fantastic growth in Japan. We are going to 34 percent. So really moving well. And we have also good performance in the US. So if you look outside the China, the ecosystem, the core ecosystem, we are doing pretty well. Are we expecting a recovering Q4? No, not really. We have anticipated that travel retail will not go back to growth. We are anticipating that brick and mortar will be also negative, but we also have good things happening in the rest of the world, particularly, for example, in the U.S. or in Japan. This is why we are expecting to do slightly better, but absolutely no miracle on La Prairie in the last quarter. On your question about parallel, we are pretty solid on that. We are attacking. We are suing everybody which is trying to copy us. We have a team on the ground being extremely aggressive against any kind of copy and parallel trade. We also, as you might remember, we were happy to see the Daegu being reduced. We consider that the Daegu phenomenon was... arming the brand equity, and so it was of course a hit for our figures, but we welcomed the fact that there was much more control. So all in all, we are pretty happy with the way we support the brand and we protect the brand. You have also to remember, Roggio, that La Prairie is one of the only luxury skincare brands which is not promoted. So we are not also playing with double 11 like some of our competitors with 80% price discount. You find La Prairie every day, everywhere at the same price, which is also limiting the game you could see with some of my competitors' brands.

Very helpful. Thank you. The next question is from Molly Wilenzig from Jefferies. Molly, please go ahead. Your line is open.

Good morning, Astrid, Vincent. Given your comments on Western Europe, could you talk about the volume-value split for Nivea in the third quarter? And also, just coming back on U.S. derma, when will we see epithelium launch in the U.S.? And maybe more broadly, how does the launch of Eucerin, Face, and Sun help you work with dermfluencers to the benefit of the global business?

Thank you. Molly, I will take your first question. We see a very balanced picture in terms of pricing and volume in the third quarter. So that's very, very promising. Obviously, we see nice volume growth, which we want to see. You know that also in previous years, we had nice volume growth. Clearly, pricing is not as high as it was in the previous period, but it's a very, very balanced picture.

Your second question, Marie, is in fact we have an history with Aquaphor of relying a lot, I mean they were not called Derma Influencer, but they are in fact Derma Influencer, relying a lot on this brand, you know, on this spokesperson for the brand, and we are expanding the model to the rest of the portfolio. We are in fact something like 80% of our media investment is in precision marketing and influencer marketing. We have not yet, you know, initiated a strong campaign on your screen face because we're waiting to get the target listing. We're very strong on Amazon, but not yet on the rest of the portfolio. So we are starting right now. The fact also that we signed, you know, a global deal with OMD, our media agency with a strong expertise in this area is helping us because we are not best in class before. So this will be also the way we will drive the brand in 2025. And hopefully, you know, obviously the launch of Tia Middle, which is a great, unique proposition, you know, which is much more original than what exists in the market today, will give us a lot of opportunities to mobilize their influencers.

And the next question is from Elisabeth Agladoun from Reuters. Please go ahead. Your line is open.

Hi. Thank you for taking my question. So my question is also a follow-up on La Prairie. Are you planning to adjust the strategy for La Prairie to mitigate the China luxury impact? Are there other regions where La Prairie is actually performing better and that would compensate for the weakness in China? Thank you.

Obviously, China is so important for La Prairie as well as for other brands. when you have such a business declining WG, it is difficult to compensate it. What I think is making us more optimistic for 2025 is not only the fact that we have clean stocks everywhere, which is so we are now really in a position where sell-out equals sell-in, the fact also that we have some geographies. I was mentioning Japan, which is really good news for us. dramatically small in japan we are growing extremely strongly 35 as i said is also helping us because we are also recruiting a very interesting vip in this country but also we have some nice plan you know in the u.s with online for example you know we have some some Very nice opportunities. We are not selling today La Prairie online in the U.S. except on laprairie.com, which is really a minor e-retailer, so big opportunities there. And also, we have some good prospects in Europe. We are opening new doors. We have some good deals also with department stores. We are reopening some stores that we left a few years ago because now we are in a better position to negotiate the placement. So again, we are not expecting a miracle on La Prairie, but we are more optimistic now that we were. six months ago, because, you know, we are moving out of this dramatic, you know, ups and downs, destocking, restocking, Inan, COVID, and everything. So, again, no other optimism, but a good feeling about 2024 and 5, and also the fact that Shantuka also is doing well. That's also, for us, important in luxury business. So we are reasonably optimistic regarding luxury next year for buyers.

Thank you.

That's all from my side.

The next question is from Ulrike Dauer at Dow Jones. Ulrike, please go ahead.

Your line is open. Thanks for taking my question. I had a follow-up question on your remarks. You'll be disappointed if not reaching the upper-ending consumer. That refers to the organic growth target, like the target range 6% to 8%. And I have a second question.

Yes, that is related to our organic growth guidance, yes, which is 6% to 8%, and we hope to be towards the upper end of that, yes.

Okay, cool. One more question on Chantecaille. Now you have two luxury cosmetic brands in China despite a weak economic environment and a sluggish demand. Do you think that's strategically wise, and why don't you think Chantecaille... as a new brand competitor could prevent La Prairie from staging a stronger recovery or delay it.

Well, you know, Rico, the market is big enough in China to have at least two brands finding their way in China. There is the situation of La Prairie that we have to fix, and you can imagine also that with the level of gross margin we have, we can really finance the turnaround of La Prairie within the P&L of La Prairie. And we have a nice story starting from zero, which is Santa Kai, but we have seen that, you know, the... The equity of the brand, the story of the way Enchantekai was built, the philanthropy, the animus is something which resonates extremely well in China. When I look at the sales here today, I can tell you it's pretty surprising. It's already our third biggest brand in China. So let's see what happens, but we launched it online, we are opening now, we will open in 25 in the Q1 some department stores, but we'll do that in a very reasonable way, in order to be sure that we don't run too fast and we don't burn money for nothing. So no issue having two brands on such a big market. And again, as I said, it's a small market for us, and it's less than 5% of our sales, but we still believe there are some great opportunities for luxury brands, and particularly for La Prairie and Chantecaille.

Okay. So, you know, no competition in the same sector, although there's two both luxury brands.

But, you know, La Prairie, the average price is around 1,000 euros. The average price of Chantecaille is around 120 euros. So we're not really fighting in the same channel. It's very different, and this is why we don't see any risk of cannibalism. And I must admit also we are not that big, so we still have a big part of the market which can be conquered by both brands.

Okay, great. Thanks. Can I ask one more question?

Go ahead.

You have time for one? Okay. Okay. There was some speculation that you would probably need to cut some marketing spend in order to reach the margin goal in consumer. You confirmed that goal. You think it's reachable without capping marketing spend in relation to sales, or will you limit marketing spend somewhat in the fourth quarter?

No, there is no such intent at all. We absolutely have already, all through the year, always committed that we want to support our brands and our growth, and we are doing that. Thank you. Thanks so much.

Thank you. And then we have the last questions coming from Misha Omanadze from BNP Paribas. Misha, please go ahead. Your line is open.

Good morning. Thanks for taking my question. Vincent, you commented on your expectation for luxury in 2025, but speaking more broadly from an overall consumer segment perspective, how confident are you in your ability to outperform the market next year? And thinking through the prism of your brands, how would you rank them in terms of the major drivers of growth next year? Thanks.

I think, Michel, we are entering into obviously more normal years. We are not expecting big inflation, of course, so there is no reason why we're going to do big price increases. We don't see any risk in terms of supply. We had a much better year in 2024 in terms of supply. We didn't have bottlenecks, so we are pretty safe there. We are back to the level of growth we had before COVID, which is a pretty nice growth for beauty. I clearly see today, I'm absolutely confident with the fact that Nivea and Usurin will continue to to over-perform the market. I mean, we mentioned Nivea would have expected, you know, the mass market brand to grow 9% and you see that it's not the same for other big mass market brands. We have 45% of the portfolio new or innovated. We have big, big innovations coming. We're also changing the look and feel of our campaigns. We're investing more in digital marketing. So Nivea will stay more than ever the pillar, you know, of Biozoic. But when you see Derma, the huge opportunities we have for derma not only where we are and obviously the launch of epicelin but also the continuous support of thiaminol is helping us but also new countries india is just the first one india is a pleasure for me i used to launch uh you know always 10 to 15 years after my main competitor this time we are the first one which is a pretty good news and we have an ambition in israel so we'll continue to grow and we'll continue to over the perform I'm also very comfortable with Chantecaille also because we're starting from a low base and we have also a huge opportunity in terms of white spaces. We are today in three countries and we have La Prairie. We are seeing some good signs. We are not over-optimistic, but the job which is done by the new leadership, by the team, the fact that we are moving away from these ups and downs of the past, the fact that we have some new projects online in the U.S., that we have some new countries. I forgot to mention we are also launching La Prairie in India. which is also an interesting market, all of that is confirming that we will overperform the market in 2025 like we have done in 2024, 2023, 2022, and 2021. So I'm pretty optimistic for the year to come.

Very clear. Thank you.

Thank you for all your questions. This concludes our third quarter conference call. Biosoft's next investor relations event will be the release of our 2024 full-year figures on February 27, 2025. We appreciate your interest in Biosdov. Thank you, and goodbye.