Carlsberg As Shs A

Ladies and gentlemen, welcome to the Carlsberg FY2025 Financial Statement Conference Call. I am Heli, the conference call operator. I would like to remind you that all the 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 broadcast. At this time, it's my pleasure to hand over to Jakob Arup-Andersen, CEO. Please go ahead.

Thank you very much, operator, and good morning, everyone, and welcome to Carlsberg's full-year 2025 conference call. As said, my name is Jakob Arup-Andersen. I'm the group CEO, and I have with me our group CFO, Ulrike Föhr, and Vice President, Investor Relations, Peter Kontroth. 2025 has been an eventful year. We executed on major initiatives that will shape the future of Carlsberg, while at the same time we navigated through quite a volatile environment in the year. Let me summarize the key headlines for the year. We closed the BritBic transaction in mid of January. We upgraded synergy expectations and over-delivered on expected 2025 synergies. We delivered good underlying gross margin improvement, and we increased our capability investments across the company. As a consequence, we delivered continued solid profit development. We delivered operating margin improvement and improving cash flow, and delivered at the top end of the guidance range. Finally, we increased adjusted EPS by 11%, and we are increasing dividends by 7% to 29 kroners per share. Before going into the usual presentation, I'm going to hand over to Ulrike, who will go through the changes to our reporting that has and will be implemented.

Over to you, Ulrike. Thank you, Jakob. And now please turn to slide three. So as you will have noticed in the release this morning, we have introduced management-defined performance measures, or NPMs, in our review of the performance and the results. And this, we have done for two reasons. Firstly, due to the significant impact from amortization of intangible assets, recognizing the PPA that is related to the BRITVIC acquisition. And secondly, as we're preparing for IFRS 18. So firstly then, BRITVIC has had a significant impact on the group's reported financial results. And as part of the purchase price allocation that is done in accordance with IFRS 3, a significant proportion of the purchase price was allocated to the Pepsi partnership to brands and customer relationships, and all intangible assets that must be amortized. So for 2025, the amortization of these intangible assets amount to some 640 million Danish kroner, and this is of course non-cash. So the amortization of brands is reported in cost of sales, while the amortization of the Pepsi partnership and customer relationships is reported in sales and distribution expenses. In our internal management performance reviews, we don't include the PPA-related amortization, and therefore, to align the internal and external reporting, we provide reported figures adjusted for the PPA-related amortization. And these, we call, these figures we call MPM, and they are short for these management-defined performance measures. And there is a full bridge of MPM and reported on page three in the announcement, and key figures are shown on the next slide. But just to make it perfectly clear, there is no change in our presentations in organic development. And then secondly, as you probably know, the new IFRS 18 reporting requirements will be the mandatory reporting framework from 2027. IFRS 18 will introduce requirements of subtotals, like operating profit, And they will include all income and expenses if they do not meet the definitions of investing, financing, income taxes, or discontinued operations categories. And that means that IFRS 18 does not allow for the use of special items, as these items have to be classified for the functional area where they derive. However, IFRS 18 do open up for the introduction of management-defined performance metrics, or MPMs. in order to improve clarity and consistency in the financial reporting. So to prepare for the new reporting requirements and avoid unnecessary confusion down the line, we have chosen to use this IFRS terminology for the PPA-related adjustments we have done in our 2025 announcement. And we plan then to be early adopters of the new reporting requirements already from this year. And that means that we will report half one in accordance with IFRS 18. And we aim to provide more information on what this means for our future reporting compared to the current framework at a later point. So then on slide four then, we show the reconciliation of MPM with reported figures for 2025. Going forward, organic development and commentary will be based on changes compared to the previous year's reported MPM figures. NPM adjustments will be the PPA-related amortizations, and from 2026, all IFRS 18-related adjustments. Consequently, NPM figures will be fully aligned with our internal KPIs, our incentive schemes, and so on, and will reflect how we run our business. And we will reconcile all NPM adjustments, including the PPA-related amortization, in a new line below EBIT. And this will be somewhat similar to what we today call special items. So with that, over to you, Jakob.