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Good morning and thank you for joining JDE Pete's half-year 2023 earnings call. My name is Marian McCarty and I will be your operator for the call. For the duration of the presentation, all participants will be in a listen-only mode and the conference is being recorded. Following the presentation, there will be an opportunity to ask questions. If you do have a question, please press star 1 on your telephone keypad. If you wish to withdraw your question, you may do so by pressing star 2 to cancel. At this time, I would like to turn the conference over to our first speaker, Robert Jensen, Director, Investor Relations for J.D.E. Peets. Please go ahead.

Thank you, Marion. Good morning, everyone, and welcome to J.D.E. Peets' earnings call related to our financial performance for the first half year of 2023. With me are Fabien Simon, CEO, and Scott Gray, CFO. In a moment, Fabien will take you through the operational and financial highlights related to our first half-year business performance and will update you on our outlook for full year 2023. After that, Scott will tell you more about the financial performance in the first half, and after that, we will be happy to answer your questions. Our press release was published at 7 a.m. CET this morning. The release, as well as the slide deck related to this call, are also available for download from the Investors section on our website. A full transcript of this conference call will also be made available in the same section on our website as soon as possible after this call. Before I hand over to Fabien, I'd like to direct your attention to the disclaimer regarding non-IFRS measures and forward-looking statements on slide three. We would kindly like to ask you to read this information carefully. And with that, I gladly hand over the call to you, Fabien.

Thank you, Robin. Welcome and thank you everyone for joining the call today. Looking back at the first half of 2023, I believe that we delivered a satisfactory set of results. In a context where the business environment very much reflected a continuation of the second half of 2022, with both inflation and a post-pandemic transition with consumers spending less time in home, Our financial results are showing a meaningful improvement compared to H2 on both volume mix and adjusted EBIT. Additionally, we are very encouraged to report that the transformation we initiated two and a half years ago is bearing fruit, with now market share outperformance of GDP in the coffee category globally. Delivering this at a time of historical cost inflations and where we made the difficult choices to lead on pricing, I think is a testament to the strength of our portfolio and of our pure player competitive advantage. Here, I would like to take the opportunity to thank our teams across the globe for their passion, dedication, and drive to make this solid set of results possible. It is important to say that we are and will remain humble as we want to perform and create value for the long term. And we are conscious that some areas are not at the standard level we have set for ourselves, such as the pace of recovery of our European performance. So in H1, we delivered an organic sales growth of 3.5%, driven by strong growth in our premium product portfolio, in a way from home, in e-commerce, in the U.S., and overall in the emerging markets. We saw a moderate decline in volume mix, while pricing was up 6.8% in H1, on the back of 16% pricing already taken last year. The volume mix decline is caused by Europe, where we did see improvement versus H2 of last year, but the recovery progressed somewhat slower than expected. Our disciplined approach to pricing, cost control, and mix management increased our absolute gross profit. This helped to absorb part of our advertising spend that increased at a high single-digit level, which is a much lower level than last year. I think this reflects on inflection points on the investment reset, as we now have our spend higher than the 2019 level. which is where we want it to be and where we need it to be. As a result, our adjusted EBIT declined by 3%. In the first half, we also saw the anticipated normalization of our working capital coming through. However, our net leverage remained well below three times. I will come back a bit later on the market share development, but wanted to highlight here three key geographic topics we communicated over the semester. First, in a category with increasingly blurring channels, we are replicating our global model by moving to an integrated omni-channel organization in Europe. This will drive simplicity, efficiency, and is a reconfirmation of our commitment to leverage on the way from home as a channel of brand building. Second, in Russia, after the first step we took in 2022, right at the start of the war in Ukraine, we are now transitioning to a local portfolio that we expect to be completed by the end of the year. Finally, we are excited with the prospect to expand further in emerging markets with the intended acquisition of Maratha Coffee & Tea that we announced a week ago. Here as well, I will come back to both Russia and Maratha in a few slides. But let me now go to the next slide, slide six, and provide a bit more color on our top-line performance. As I alluded to earlier, and besides the ongoing discipline on pricing across all geographies, H1 witnessed another step of transition post-COVID-19. Globally, the industry reported about 4% volume decline in in-home consumptions and further traffic again in away from home. In other words, consumers do not drink less coffee and tea when at home, but are just spending less time at home versus last year. Our revenue per channel is reflecting these trends, with away-from-home growing almost double-digit, and now back to pre-COVID level in absolute, while our in-home organic sales growth was 2%. Outside Europe, we compensated the in-home category decline with market share gains, which explains why three out of our four segments reported revenue growth between 5% and 10%. It is worth noting that globally, we grew aluminum capsule, which is always an attention point from this audience, at double-digit level with solid mid-single-digit volume growth. Similarly, our e-commerce momentum continues with, for example, over 30% growth in DTC. We believe that in H1, we see the inflection points of the post-COVID transition that started in 2022, and as such, explain why we are anticipating some growth acceleration in the second part of the year. But before putting back our H1 in light of our strategic priorities and with more detail on key regions, I would like to share how we see cost inflation evolving. Although many could have hoped that this year would show a meaningful reversal in inflation, the first six months have clearly shown that this is still a meaningful reality we have to deal with in 2023. After two years of elevated level of inflation, as high as 30% of COGS in 2022, we again had to deal with a double-digit level of inflation in H1. Besides high green coffee prices, we are witnessing a spillover of inflation into packaging, salaries, and services. Lately, on the coffee commodity side, in front of some softening of Arabica prices, The market for Robusta is now trading around a 15-year high level, and the cost premium for Responsible Resource Coffee is increasing double-digit. Net-net, we are expecting now a high single-digit cost inflation for the full year. As we demonstrated since 2021, we will be disciplined on how to manage inflation. Further cost inflation will mean further pricing going forward. but basically more modest as we are entering into disinflation. Let's now go to the next slide and have a look at the three strategic imperatives that we are focusing on. As part of building a unique and stronger pure player, one of our objectives is to become more global from a legacy-anchored European business. In H1, Europe represented 57% of total revenue from 70% in 2019. And let me provide here a couple of examples of what we are doing on this front. First, and this is key to me, we focus on building quality market shares as opposed to buying short-term market shares. To do so, we have reset how much and where we invest in brands, innovations, in capabilities and in sustainability. We are building new growth pools in the U.S. and greater China, as well as in some selective emerging markets that are all together growing at a much faster pace than Europe. Next to the organic way, acquisition can accelerate the transition as well. And here, the intended acquisition of Maratha in Brazil is an excellent example of becoming even less dependent to Europe. In a more fragmented world, global development can also lead to local adjustment like in Russia. Transitioning to a local portfolio will lower our overall exposure there on both top line and bottom. Additionally, in a world where the use of distinct channels by customers and consumers is blurring, where consumer facing and relationship is key, we have to adjust. and we are doing it at pace. At the end of H1, 40% of our media spend is digital. And I am very pleased with the acceleration of our e-commerce capabilities and performance, visible with our revenue growing multiple times faster than offline. We had to adjust our organization in Europe as well, in a similar way as in our other regions, to leverage our brand on wherever consumer goes. And that transition is well underway and is expected to be completed by the beginning of Q4. Third, we have to play our part to embed and ensure an inclusive ecosystem as this is the only way to guarantee sustainable value creation over time. We came from far with not much agenda other than a long-term intention in the past. But now I am proud to get ESG embedded throughout the organizations and and now visible into our innovation pipeline and brand meaning. Next to that, we acknowledge that it is important for equity and debt holders to get visibility on where companies stand on ESG. And here again, we made solid progress with holistic external ratings and regular updates on our progress and objectives. Let me go to the next slide and share how much our strategic focus and the disciplined execution of our plan is paying off. The slide shows the last three years' market share evolutions tracked by Nielsen in all the GDP geographies. So at a time when we took the lead on pricing and when private labels are gaining momentum across geographies, we are very pleased to report a slight total market share outperformance. With 5% compounded value retail sales growth since H1 2020, it confirmed that we reshaped J.D.E. Peets from an historical underperformer to now growing at par, if not slightly ahead, of the attractive coffee market. I shared a few times the view that there are likely going to be two long-term global scale winners in this category, with J.D.E. Peets and the current global leader, that I do greatly respect because it sets high standards. And there will be some moments when one will go ahead of the others and vice versa. Today, we are humbled to share that against a high-performing global coffee leader, our share performance can be very competitively benchmarked over the most recent history, as you can see on the right side. I read in these numbers the strength of our portfolio from consumer appeal to pricing power, but as well as the result of the choices we made with a discipline in execution. I guess the next slide will reinforce that point further. On this page, you can, in a very transparent way, see JDIP's market share evolution per geography on the left side and per category on the right side. We have been losing shares in Europe. on the back of retaliation in H2 of last year that we are slowly rebuilding but is not yet completed. But in parallel, our strategic accelerations in the U.S., in APAC, and in LARMEA is more than compensated the share loss in Europe. Not only we did grow more than Europe in these regions, but as well outperformed competition there. What we see lately in LARMEA is negative share performance on the back of recent share loss in Russia of about 200 basis points last two periods, coinciding with the start of our transitions to local bond portfolio, where we noticed very aggressive competitions to get volume from us. In Europe, a good proportion of our share loss is coming from our drive to build quality market share, and refusing to participate in value-destructing activities, especially on the roast and ground category visible on the right-hand chart. Actually, we are focusing our resources on the highest price and higher margin category. Here again, we are very satisfied with the outcome and share gain in single serve, share gain in instant, and share gain in beans, while accepting, without any regret, share losses on some unattractive parts of roast and ground. Now, let me provide you with a bit more color on the post-COVID normalization that impacted category growth in H1. Many industry players, including ourselves, assumed that the post-COVID normalization was out of the equation by the end of 2022. However, we started to realize in the course of H1 this year that the post-COVID normalization together with the focus on less consumption waste and some hunkering down by consumers, was impacting volumes in many parts of the world. In Europe, our volumes were further hampered by the fact that it took longer to rebuild the distribution that we lost following the retailer negotiation at the back end of 2022. And because we continue to focus on quality market share, some volumes were under pressure, as we said no, to unattractive promotional propositions in various European markets. So from here onwards, we believe that overall, the post-COVID normalization is now behind. Similarly, consumers' focus on limiting spoilage and pantry loading will most likely be less significant going forward. In Europe, distribution is now restored at the end of Q2 2023. However, more gradually than expected. What is less clear to us at this moment is whether or not there will be additional volume rebound on some promotional activities that we refuse to participate in in H1. So saying differently. If the requirements remain similar and players accepting to entertain what we consider pure volume gameplay, we will not get volume back, as we will continue to prioritize quality of market share and value for shape. Now let's zoom in on other regions, on other two strategic areas, U.S. and later China. In the U.S., PIT continues its successful trajectory and recorded almost alpha points of additional household penetration from H1 of last year in hot coffee and is gaining share in the majority of the states on the premium segments. Additionally, and leveraging on the successful result of low barista appliance in Europe, we have initiated a new venture. It's a pilot launch in the U.S. market. which we hope to share more at a later stage, either this year or next year. In Greater China, we continue to roll out our successful omnichannel strategy. We do not witness slowdown there. Coffee is still at the early stage in the penetration curve, and JDB portfolio seems appealing to consumers. Our business is growing ahead of many other competitors at a heightened level in H1. We mentioned in the past that Greater China has the potential to be one of the top five largest markets for GDPs. In that journey, H1 marked a nice milestone with Greater China joining the top ten markets for the first time of GDPs in revenue. We also continue to expand in emerging markets through inorganic initiatives, as you can see on this chart here. So last week, We announced the intended acquisitions of Marata's coffee and tea platform in Brazil. There are many things we like about Brazil. It offers an attractive macroeconomic landscape. It is the largest coffee market in the world based on the number of cups consumed, and a market that we do know pretty well with our nationwide leading coffee brand, Spilau. Within this attractive market, Marata is the number two player in the north-northeast regions and generates on a three-year average more than 1.1 billion Brazilian reais of net sales per year. This acquisition would represent a complementary proposition to our existing business in Brazil, which is mainly centered around the southern region. It will also allow us to serve more cups around a full range of price points, in a market that will offer a reservoir of premiumization over time. As a result, the acquisitions offer long-term value creation potential with attractive revenue and cost synergies. This will come with a minimal impact on our performance leverage as Maratha is a well-run company today. That transaction is subject to be It's subject to regulatory approval and other customary closings conditions and is expected to be closed in 2024. Let's now move to the next slide, slide 14, and update you on where we stand with respect to our operation in Russia that I mentioned a few times already. First of all, I would like to reconfirm what I shared at the Dutch Parliament hearing back in February, where we explained the three reasons why we decided since the start of the war to stay in Russia. First, our products, coffee and tea, are essential products for consumers, and selling coffee and tea remains fully compliant with any existing sanctions. The second reason is we have an ethical responsibility for our employees around the world, including the teams in Russia. We employ a bit more than 900 people in Russia who have no part in this war, and would be severely punished if we would shut down our business. Third, if we would decide to leave the country, we would face the real risk that our assets and intellectual property would be nationalized by the Russian state or given to some party in Russia. And if this were to happen, manufacturing and intellectual property would, in effect, permanently benefit a person, company, or state institution in Russia. The other things we did from the start was to run our Russian business as much local for local as possible to create as much flexibility and optionality going forward. And following the actions we already took in 2022, we have recently moved to the next level and have started to transition to a local portfolio of brands, which resulted in a goodwill impairment of the Jacobs brand of €185 million in H1s. We expect these brand transitions to be completed by the end of 2023 and anticipate that this will lead to a substantially lower sales and profit contribution from Russia in the second half of this year, like we started to notice in May and June already. Now, before going to our outlook, I would first like to go to slide 15 to share some highlights on sustainability. I am very pleased with the continued progress we are making there on a topic which is well anchored in our growth and purpose-led strategy. Let me call out a few highlights of this semester here. Following the announced introduction of fully compostable capsules that will be available at the beginning of next year, we lately communicated the upcoming launch of a new paper pack for our soluble coffee branches. which is fully recyclable and is the first of its kind in the coffee market. The related SKU will generate the lowest carbon footprint within the existing range of GDP's product in-home, at about 17 grams of CO2 per service. During this semester, we also deployed carbon and packaging accounting that we introduced at our Capital Market Day in January. and we published our policies on water stewardship and nutrition. And as an other testament to our progress and what we have been doing over the last 18 months, ISS increased our ESG rating and gave us prime status, which moves us right up to the first design in our industry. So before I hand over the call to Scott, I would like to update you on our outlook on the next slide. We expect the business environment to remain volatile for the remainder of 2023. Nevertheless, and encouraged by our top line in the first half of the year, we continue to expect to deliver organic sales growth at the high end of our medium-term range of 3% to 5% for the full year 2023, with growth acceleration and a more balanced contribution from volume mixed price in the second half of the year. However, as there is uncertainty on the impact of the transition from international brands to local brands in Russia, we believe that it is more appropriate to guide our fully organic adjusted EBIT growth in the range of low single-digit increase and low single-digit decrease. Next to that, we expect our net leverage to remain below three times, with a free cash flow of around 400 million euros post-normalization of working capital, and confirming an ongoing run rate of €1 billion on three-year average. Lastly, we continue to aim for a stable dividend. So with that, I will hand over the call to Scott, and I will be back when we start the Q&A.