Beiersdorf Ag

Ladies and gentlemen, welcome to the PIASOF H1 Results 2025 conference call. I am Valentina De Coro's call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and 1 on your telephone. For operator assistance, please press star and 0. The conference must not be recorded for publication or broadcasting. At this time, it's my pleasure to hand over to Christopher Sheldon, Head of Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining us this morning for the presentation of our first half-year results 2025. I'm here with our CEO, Vincent Vanery, and our CFO, Astrid Herrmann. As always, we will start with the presentation of our results, followed by a Q&A session. And with that, I would like to hand over to Vincent.

Thank you, Christopher. Good morning, everyone, and thank you for joining us to this conference call. Astrid and I will now present an overview of our financial performance and key developments for the first half of 2025. Balzo showed a solid performance in the first half year despite a challenging market environment. Market growth, especially in the emerging markets, was slower than expected due to broader economic uncertainties, geopolitical effects, and a lower consumer confidence. Our core brand Nivea navigated a weaker mass market and faced a tough comparison base in 2024. This resulted in a disappointing performance below our expectations in the first half of this year, especially in the second quarter. Our Derma business, on the other hand, once again set a benchmark in the industry. Performing against tougher market conditions, Derma continued its growth trajectory from Q1 2021 and achieved outstanding double-digit sales growth in Q2. Our strategy of launching breakthrough innovations across our global brands and expanding into wide spaces continues to pay off. This is our expertise and our strength, and we have demonstrated it with the outstanding success of our anti-aging ingredient, Epicillin, under Eucerin. This gives us great confidence that the launch of Epicillin under Nivea will be even more successful and boost our sales in the second half of 2025. Looking at our luxury brand, La Prairie, we saw some positive signs in China during the second quarter, while other markets remained soft, particularly the U.S. and travel retail. Altogether, amid a volatile market environment, we continue to advance on our path towards global leadership in skincare, because skincare is what we know and do best. Although we aim for strong growth, our skincare performance outpaced that of our key competitors. Reviewing our sales performance, the first half of the year showed a mixed picture for our brand portfolio, framed by volatile and demanding market dynamics. Nivea grew by 1% organically in the first six months, impacted by slower markets and a high prior year comparison base of 11.1%. While the first quarter of 2025 showed a solid performance, the second quarter did not meet our expectations. With 12.2%, our Derma business delivered again a strong double-digit organic growth despite a softer market environment. Driven by innovation and expansion into wide spaces, our Derma brands continue to be our current growth powerhouse. The healthcare business, which primarily comprises the Anzaplast and Lasoplast brands, delivered strong organic sales growth of 8.4%, a significant improvement compared to 4% in H1 2024. The increase was again innovation-led and mainly driven by the launch of the new and innovative second skin protection plaster in the first half year. As planned, La Prairie was able to decelerate the sales decline over the past months. After a drop in sales of minus 17.5% in the first quarter, the second quarter was at minus 1.5%, leading to minus 10.7% in the first half year 2025. All in all, in the challenging market environment, the consumer business achieved sales growth of 1.9%. TESA reached 3% sales growth in the first half of the year, due to the high performing electronics business. This results in a group organic sales growth of 2.1%. Nivea fell below our expectations in H1, which is the results of a mix of expected and unexpected factors. We are comparing against an exceptionally strong first half year, 2024, where Nivea grew 11.1%. As we move into the second half of the year, the comparison-based softens, giving us a more favorable setup in the coming quarters, together with a stronger second half-year innovation pipeline. In China, we have taken bold steps to reset and refocus the Nivea brand, moving away from price-sensitive personal care segments towards premium skin care and grow through a digital-first approach. These planned measures are on track but continue to impact or short-term results. In addition, the mass market did not grow as anticipated. Former growth drivers, particularly emerging markets in Eastern Europe, have slowed significantly, with market value growth moving from double-digit to mid-single-digit, and volume growth in emerging markets declining from mid-single-digit to nearly zero. This was due to economic uncertainties and more cautious consumer spending. The unpredictable nature of US tariffs has been adding further uncertainty. Like many of our larger competitors, we are facing increased competition from local brands. Many of these small brands are based on a simple ingredient story and have shorter life cycles. We have successfully navigated similar competitive pressures in the past, and we plan to continue to do so through breakthrough innovations and product launches in many markets. Our derma business is a showcase for success on a global scale through innovation based on skin science. Our double-digit sales growth continued through Q2 at an impressive 13.3%. We gained market shares across all regions and outperformed the market by 2.1 times. Expanding into wide space market was the key driver of our business in the first half year. In North America, our biggest market for Derma, we delivered strong double-digit growth of 11.6%. This was mainly driven by the continued success of Tiamidol. The launch of the Usurin Radiantone collection in early 2025 shows excellent traction. The entry of Usurin in domestic China seeded expectations with an outstanding 61.9% organic sales growth in the first half of the year. And there is more to come. Following the official approval of a patented ingredient here in China last year, we are ready to unlock the full potential of this market. The key driver of these results was epicillin, which reactivates youth genes to reverse signs of aging. In less than a year after the launch last September, we have taken number one positions in many markets across the globe. In Germany, Mexico, Brazil, and Chile, our Eucerin epigenetic serum has become the number one anti-aging product in the respective markets. We have not only reached number one positions in many markets, the true power of innovation lies in how it resonates with consumers and performs against top products from peers over time. Our repurchase rates are impressive across markets, with a 51% top score in Thailand, followed by France, Germany, and Mexico. While a cumulative 23% of consumers in Germany have repurchased the epigenetic serum since launch, an outstanding 37% of consumers who bought the product in the first months of launch have repurchased it in the meantime. This is three times higher than other top innovative products in the market. Further growth potential is expected as we continue to route Eucerin Epicillin across the world and unlock the full consumer potential. Now it's time for Nivea to bring Epicillin to a new level. By launching Epicillin in our iconic brand, we tap into even greater potential as we enter the mass market and make these breakthrough integrations available to a large, attractive consumer base. Introducing the Nivea epigenetic serum is a major milestone in our innovation strategy and a game changer in the mass anti-aging market. We are extremely excited about this launch. Longevity is top of mind for consumers, and our goal is to lead the way in longevity science by cutting-edge research based on real consumer insights. By leveraging the power of epigenetics, with our breakthrough ingredient, epithelium, we provide an effective solution for more youthful skin already today. For us, true skin longevity means scientifically proven ingredients that target the root causes of aging. The Nivea, the launch of the Nivea Epigenetics Serum is underway. Starting in September, consumers in Europe will benefit from this innovation which is scientifically proven to reverse skin age by reactivating new cell functions. And we are fast. By the end of 2025, Nivea epigenetic serum will already be available in 30 countries worldwide. This ambitious launch plan, realized in just a few months, reflects the strengths of our organization. With Usurin, we have seen that this product can truly make a difference. With Nivea, we make this difference even more accessible, which is why we aim to roll out the product globally as quickly as possible. I look forward to sharing the results with you in our future quarterly course. Innovation will pave the way for a stronger second half of the year for Nivea. With a strong innovation pipeline ready to be rolled out, we are confident to improve our growth and gain market share in the coming months. We expect net sales from launches to be almost double the 2024 level. As already mentioned, the market entry of the Nivea epigenetic serum is anticipated to be the biggest launch ever for Biosoft. Other examples are the launch of the derma-controlled deodorant range, which brings skin care expertise and personal care performance together. I will come back to that in a moment. And the new Skin Glow range with Tiamidol, building on the success of Nivea Lumina 630, this new range makes our hyperpigmentation ingredient available to a broader, more diverse consumer base. Coming to La Prairie, the luxury brand was able to decelerate the decline in sales over the past few months. The second quarter showed encouraging dynamics with organic sales growth of minus 1.5%, after a minus 17.5% in the first quarter of this year. Overall, the brand recorded an organic decline in sales of minus 10.7% in the first half year of 2025. In China, La Prairie managed to grow by 3% in the second quarter amid a volatile market environment. This result was driven by the continued outstanding performance of our online business, of plus 36% organic sales growth in the second quarter. However, despite first signs of improvement in China, other regions remain challenged. The market in the U.S. and travel retail were negative in Q2. We expect market conditions to remain volatile in the coming months and are therefore cautious in our outlook. Shantakai delivered outstanding double-digit sales growth of 16.1% in the first half of 2025. The already impressive performance in the first quarter was followed by organic sales growth of 16.3% in the second quarter. The U.S. contributed to this result with plus 15.3% growth. Following the record time launch of Shantuka in China in 2024, we are on track with our business in the market, particularly in e-commerce, where we continue to build momentum. In May this year, we took the next step by opening our first brick-and-mortar boutique in Shanghai, the key milestone in our growing presence and commitment to the Chinese market. Altogether, our skincare business grew by 2.6% organically in the first half of the year. While we certainly aspire to drive stronger growth, we perform better than our key competitors in this category, even in certain market environments. Because it is skincare expertise that sets Biosoft apart. It's not just what we do, it's what we do best. We focus on what matters most to our consumers. We target future-defining skincare needs, from hyperpigmentation to aging skin, with innovations that make a difference. Take Tiamidol, for example, our patented solution designed to reduce pigmentation marks. It's a global growth driver across our key brands. And EpiCellin, after years of pioneering research in epigenetics, we are setting new standards with our H-Club technology and the breakthrough anti-age ingredient. And we deliver with EpiCellin in Usurin and now with Nivea. With our innovative product offering, we attract consumers across the world and are able to expand into wide spaces with success. Take India as an example. With the right assortment and launch strategy, we were able to successfully introduce Usurin and lift Nivea to new heights. In this highly competitive market, our business grew by more than 30% in the first half of the year. And we are succeeding in effectively competing against private labels. Take Suncare. In Suncare, we have managed to successfully outperform the market and gain market share this season across our key markets, most prominently in Europe, the largest region for Nivea SN. Here we grew by 12.7% in the first half year. Our deodorant business is one of our long-standing contributors to BioServe's success. With the launch of the DermaControl deodorant range, we are bringing something truly new to our consumers. For the first time, we are combining high-performance personal care with our trusted skincare promise. The result? superior skincare without compromising on efficacy. Now over to you, Astrid, for the results of our TASER segment and the financial for the first half of the year.