Kering Sa Ord

Good evening everyone and welcome to Caring H1 2026 results. This presentation will be made by Luca de Meo, Jean-Marc Duplaix and Armelle Poulou and will be followed by a Q&A session. Luca, the floor is yours.

Good afternoon everyone and of course thanks for joining us. Before Armelle takes you through the financial results, I would like to share some thoughts on the first half of 2026 and obviously also about the progress we're making across the group. So H1 has been about turning strategy into action and action into results. Three months after our capital market day, we started to execute our brand's playbooks, reduce inventories, optimize our store network, significantly reduce our net debt and improve our key operational and commercial indicators. These actions... Translated into tangible progress in our performance and in fact the group returned to growth in the second quarter despite continuing to optimize its store network. This is particularly significant as we completed 84 net store closures in the first half following 75 net closures in 2025. Sa Ord optimization is not only about reducing our footprints, it is also about upgrading, renovating and elevating our most strategic locations. And the fact that we return to growth while materially reshaping our network demonstrates the improving productivity. Thank you very much. Thank you very much. This is why we remain focused on strengthening our brands and building a more agile, disciplined and effective organization. Our first priority is to reignite the desirability of our houses. Thank you very much. Our ambition is to translate creativity into desirability by ensuring that product, merchandising, pricing architecture, marketing and retail excellence work together as one coherent engine. Let me now share some concrete examples of the progress we have made since our Capital Market Day in April. Starting with Gucci. The Renascimento plan is firmly underway. Thank you very much. Thank you very much. On the desirability front, recent initiatives have been well received. The Primavera fashion show and the Gucci core cruise show in New York at Times Square generated strong global media resonance and ranked first worldwide in earned media value. And this reflects Gucci's ability to be back at the center of the conversation. The creative roadmap is clear. La Familia was designed to reconnect with Gucci's roots. Primavera aims at reigniting fashion leadership and Gucci Core Cruise Collection expands the house appeal. Thank you very much. We continue to bring Gucci's cultural expression to life through La Gucci Vita, a platform that extends the house codes beyond fashion and strengthens relevance, engagement and, of course, desirability. We announced our partnership with Alpine Formula 1 from the 2027 season, which will lead to the launch of Gucci Racing, creating a new platform for visibility and cultural relevance, with new products and experiences in sports as a territory of expansion. Another important milestone came on July 7th with the announcement of the exclusive beauty license agreement between Gucci and L'Oréal, one year ahead of schedule. Thus, we are creating a strong platform for long-term growth. These initiatives are different in nature, but they reflect the same objective – Thank you very much. The House returned to growth in the first semester. We are consolidating fundamentals while working on the key pillars that will drive the next phase of growth. In Asia-Pacific, we are sharpening execution through more localized campaigns and activations. At the same time, we are successfully scaling the men's category through a renewed product and retail strategy, which is also and already translating into Thank you very much. Bottega Veneta continues to be one of the strongest growth engines within the group. Leather goods remain at the core of the strategy. The house continues to enrich its product offer with the recent introduction of the new handbags such as the Barbara or the Madison, further expanding the assortment while the Mini Andiamo has emerged as one of the house's strongest products Thank you very much. Building on this, Bottega Veneta continues to deepen its local engagement through partnerships with leading cultural institutions in Thailand and in South Korea to reinforce its brand integrity in the region. So as we look ahead, I am also pleased to welcome Romain Spitzer, Valenciaga Thank you very much. The priority is to establish a clear and distinctive proposition, reconnect with existing clients and attract new clients and new audiences through a more elevated, feminine and couture-inspired expression of the Balenciaga silhouette. The strong reception of the latest Haute Couture collection a few weeks ago further reinforced Balenciaga's position as one of the few houses with genuine couture authority and creative legitimacy. Balenciaga is also enriching its footwear universe with new propositions such as the Radar, Jet and Triple S2, while continuing to perform strongly in markets such as South Korea, highlighting the brand's relevance in one of the world's most dynamic luxury markets today. McQueen. McQueen is executing its transformation plan focused on simplification and operational discipline while refocusing the brand on its unique British tailoring DNA. This includes the rationalization of the store network with 20 closures in H1 2026, a right sizing of the organization and a greater leverage of Group, Platforms and Shared Capabilities. The recent appointment of Gianfranco Dattis as a CEO, in my opinion, marks an important step in the next phase of the house development. At the same time, the decision to bring the fashion show back to London reflects McQueen's ambition to reconnect more closely with its heritage and reaffirm its unique creative identity. Now Brioni. Brioni continues to demonstrate the value of its unique positioning in sartorial excellence while increasingly contributing its craftsmanship and manufacturing expertise across the group. This includes supporting know-how sharing and industrial synergies and other houses, notably Gucci and Bottega Veneta. The house continues to deliver solid growth, supported by the growing success of Maestria. This is the high-end bespoke offering, which grew by more than 30% year-on-year and now represents nearly a quarter of store sales in H1 2026. Let's turn now to Kering Jewelry, which continues to grow double-digit. At Boucheron, momentum remains particularly strong, reflecting the growing desirability of the Maison. The launch of the 4XS has been a notable success, especially in Asia, demonstrating Boucheron's ability to continuously reinvent its icons. Both Boucheron and Pomellato further reinforced their desirability through their latest high jewelry collections. At Boucheron, the human being collection stood out as a remarkable demonstration of creativity and technical innovation, pushing the boundaries of traditional high jewelry while remaining deeply rooted in the Maison Savoie Faire. At Pomellato, we are amplifying brand visibility through a series of high-profile activations, including a dedicated exhibition at the Palais de Tokyo, further reinforcing its positioning as a benchmark in contemporary fine jewelry. At Chilin, we continue to strengthen the Maison's unique position at the intersection of Chinese culture, fine jewelry, and contemporary luxury markets. Momentum remains particularly strong in Asia-Pacific, with outstanding performance in South Korea. As highlighted during our Capital Market Day, We also see significant growth potentially in jewelry across our fashion houses. The recent high jewelry activation of Gucci in Times Square generated strong client engagement and illustrated the potential for expansion. At the same time, we continue to build a more integrated and scalable jewelry platform already delivering the first sourcing and industrial synergies. In eyewear, we continue to build one of the most successful platforms created in luxury over the last decade. The launch of the first Valentino eyewear collection, supported by high-profile events in Milan and in New York, marks another important step in the expansion of our brand portfolio. Performance in the first half was notably driven by Cartier, and Baibottega Veneta, both of which delivered strong double-digit growth, reflecting the exceptional reception of the latest collection and the continued strength of their brand desirability. Maui Gym and Lindbergh also delivered solid growth, supported by product innovation, strong execution and continued momentum across key markets. Kering Eyewear delivered another period of strong growth and profitability, Demonstrating the strength of our luxury portfolio and our ability to translate brand desirability into category leadership. Alongside our brand initiatives we have been restoring operational rigor across the group. This includes tighter control of inventory, more disciplined management of our retail network, Thank you very much. and Anouk Duranto-Loper as the Deputy CEO of Saint Laurent in charge of product in this fantastic maison. China is a top strategic priority for caring. Last week we were on the ground with our teams to launch a dedicated action plan aimed at accelerating execution and strengthening the relevance of our houses in that important market. Our priority is simple. Thank you very much. while accelerating our capabilities in clienteling, digital engagement and retail excellence. China is evolving, as you know, rapidly and it's becoming more selective, more local and more experience-driven. And in this environment, success is increasingly determined by desirability, relevance and execution. This initiative is built around clear objectives and measurable milestones, strengthening our execution in a country which remains one of the most important growth opportunities for luxury over the long term. Thank you very much. Fashion Week, through a residency program supporting 10 promising Chinese designers, we are investing in the next generation of creativity while deepening local insight and connecting to the next generation of Chinese talents and clients. Restoring long-term performance is also about building stronger common capabilities across the group, I'm convinced. One of the most important changes Thank you very much. Thank you very much. Thank you very much. Balenciaga and Saint Laurent leveraging selected Gucci industrial assets. Beyond driving competitiveness, these initiatives also enhance traceability across our supply chain. So technology is becoming part of caring operating system, helping us make faster, smarter, and more informed decisions across the value chain. This is the ambition also behind augmented caring, combining human expertise with data and AI to improve decision making, enhance execution, and scale best practices across the group. We are not starting... From a blank page, the foundations are already in place, a single cloud-based data platform, digital twins across clients, products, and supply chain, and AI-enabled use cases already delivering tangible results. We are notably deploying advanced planning and inventory management tools, improving visibility, Thank you very much. contribute to our sustainability ambition of driving fair production through resource efficiency, producing closer to demand, reducing waste and making better use of resources across the value chain. In the first half, we have advanced our roadmap around fair production, material innovation and craftsmanship, sustainability, Thank you very much. Thank you very much. Transformation starts with people. It requires a challenger mindset and fresh perspective. This is why we launched Ockering, Gathering high potential talents from across our houses, functions and region and exposing them to some of our most strategic challenges. Several ambitious projects are already moving into implementation. These initiatives span product innovation, AI-powered solutions to enhance client engagement and decision-making, as well as the design of a global event aimed at inspiring and connecting the next generation with luxury. Akkering is a powerful illustration of the energy, the creativity, and the entrepreneurial spirit that exists across the group. Ultimately, the AI-enabled tools we are developing are transforming the way we engage with clients. Client advisors can access relevant client insights and product recommendations through Natural Language Queries, created tailored selections and deliver more personalized experiences. To conclude, the first half of 2026 was about turning strategy into action. We continue to strengthen our houses and we made concrete progress in building a more agile and disciplined organization. Now Armelle, it's time for you to take us through the financial results in more detail.

Thank you Luca, and good evening everyone. Luca has just outlined the action, let me show you the results. The group is back to growth in the second quarter. Profitability improved, our balance sheet is now much stronger. And we did all of this while continuing to invest in the desirability and future growth of our houses. On slide 16, you will find a summary of the key figures for the first six months. Revenue was 7.2 billion euros, up 1% on a comparable basis, with a return to growth in the second quarter. Recurring operating income came to 921 million euros, a 12.8% margin, up 40 basis points year on year, and 300 basis points versus the second half of 2025, delivering on the progressive improvement we had targeted. Free cash flow from operations reached 2.6 billion, including around 800 million from real estate net proceeds and the Gucci Beauty agreement. CapEx amounted to 419 million. Excluding real estate investment, CapEx was €260 million, representing 3.6% of revenue. Net financial debt stood at €3.3 billion at June 30, down €4.7 billion from year-end 2025. All those indicators point in the right direction. On slide 17, first half revenue was down 3% reporting and up 1% comparable. After a stable first quarter, the group posted comparable growth of 2% in Q2, a two-point sequential improvement, and the first quarter of growth in 12 quarters. This acceleration was reflected in better trends across most of our activities. We achieved that while continuing to streamline our network. We ended June with 1,635 stores, down 84 since your end, on top of the net 75 closures completed in 2025. We remain on track to deliver at least 100 net closures this year. Beyond efficiency, these actions sharpen our presence, focusing on fewer, higher quality locations and driving stronger store productivity. Foreign exchange remains a headwind. FX weighted on reporting revenue by close to 4 percentage points over the half, largely concentrated in the first quarter. In Q2, the drag eased to around one point, supported by the appreciation of the Chinese renminbi and the South Korean one. Looking at our regional mix, North America increased its contribution to 24% of group revenue. Western Europe remained stable at 30%, while Asia-Pacific, excluding Japan, was broadly unchanged at 30%. Japan represents 7% of world revenue, and rest of the world decreased to 9%, mainly reflecting the situation in the Middle East. I will come back to this in a moment. On slide 18, you have revenue by segment for Q2 and H1, and sequential trends are positive across the board. Again, fashion and leather goods were stable in Q2 on a comparable basis, a 3-point sequential improvement versus Q1, with trends at Gucci improving by 6 points versus the first quarter, leaving Q2 down 2% year-on-year. Kering Jewelry delivered another outstanding quarter, up 18% comparable versus last year, after 22% in Q1, confirming its role as a growth engine for the group. Kering Eyewear grew 8% comparable versus last year, accelerating slightly from Q1, once again demonstrating the consistency of this business. Corporate and other declined 6% on a comparable basis in Q2. Overall, the return to growth was broad-based. On slide 19, the top line by channel. Retail, including e-commerce, accounted for 73% of group revenue. It was broadly stable over the semester on a comparable basis and returned to growth in the second quarter up around 2%. Traffic remains under pressure across most regions, but conversions improve and both average unit retail and average tickets increase meaningfully more than offsetting lower volumes. E-commerce grew 3% comparable and represented around 12% of retail sales. Wholesale and other, which accounted for 27% of total revenue, was up 5% on a comparable basis in the first half, although this reflects two different dynamics. All sale revenue from fashion and leather goods was up 1% as we continued to prioritize our own retail network while working with a more selective base of wholesale partners. Growth was driven by both eyewear and jewelry. Our revenue increased 8% comparable, reflecting the strength of a business model that is wholesale driven. Jewellery wholesale revenue was up 7% comparable in the first half. After a strong first quarter with growth of 14%, second quarter revenue was flat, primarily reflecting the conversion of some franchise locations to directly operated stores. On slide 20, a closer look at retail by region. North America was once again the group's strongest region, up around 10% in the second quarter versus last year, after 9% in the first quarter, with positive contribution from most of our houses, including Gucci, where brand equity is resonating particularly well with American consumers. Thank you very much. Driven notably by the outstanding momentum of our jewellery houses and a more favourable tourism dynamic than in Q1. Asia-Pacific was down 1% in Q2, with trends improving gradually. Performance remained mixed across the region. While mainland China remained down, the rest of Asia, and South Korea in particular, delivered an excellent performance. Finally, rest of the world remains challenging, down 8% in Q2, mainly reflecting the instability in the Middle East, even as retail in the region improves sequentially month after month through the quarter. The Middle East typically accounts for around 5% of group retail revenue. Its negative impact on group revenue growth was 1 percentage point in the second quarter, in line with Q1, when the disruption affected only one month of the quarter. Taken together, momentum improved across most regions. Let's now turn to profitability on slide 21. Recurring operating income reached 921 million euros in the first half, with a margin of 12.8%, up 40 basis points year-on-year and 300 basis points versus the second half of 2025. Our margin is now above both the first half and the full year of 2025. Two things drove it. Better commercial momentum and the discipline now embedded across the organization. Thank you very much. Hope OPEX was down 5% in the first half at 4.2 billion, driven in large part by fixed cost reductions that have structurally lowered our cost base. These are structural actions and their benefits will continue to build. Crucially, none of this came at the expense of our houses. ANP was maintained at around 9% of revenue, sustaining brand visibility and supporting the momentum of our collections. That balance is deliberate. We are restoring profitability while continuing to fund creativity, innovation, retail excellence and client engagement. and this is what gives us confidence in the durability of what we are building. Let me now review our segments, starting with carrying fashion and leather goods on slide 22. Revenues stood at 5.8 billion euros in the first half, down 1% comparable. In the second quarter, revenue reached 2.9 billion euros and the segment turned positive. 3 points better than in Q1. Beyond Gucci, which I will cover in a moment, momentum improved across several houses. Saint Laurent delivered a strong quarter in retail, with growth accelerating across most markets. The house performed particularly well in North America and Western Europe, supported by strong client demand as the new collection continued to gain traction. Better retail execution and stronger product availability drove robust growth among both VIC and core clients, while mainland China and the Middle East remained more challenging. Bottega Veneta once again outperformed, with retail trends accelerating across most markets. The acceleration was particularly strong in North America, Japan, South Korea and Western Europe, supported by excellent momentum in leather goods. Balenciaga faced a more challenging quarter in retail, as the house continued to work through its creative transition and rebalance its business. Let the goods, driven by the city and Rodeo, deliver the strong performance, a reminder that the underlying product engine remains sound. McQueen accelerated the execution of its repositioning under its new CEO, strengthening the foundations of the brand and rising its distribution network. Brioni continued to deliver another quarter of strong performance. Segment profitability also improved. Recurring operating income was 828 million euros, a 14.3% margin, up 0.7 points versus the first half of 2025, reflecting cost discipline throughout the segment. Focusing on Gucci now on slide 23. The House recorded sales of 2.8 billion euros in the first half, down 5% comparable. In the second quarter, revenue reached 1.4 billion euros, with the decline narrowing to 2%, six points improvement versus Q1. New collections continue to gain traction, driving stronger brand visibility, renewed client engagement, and positive retail trends. Leather goods return to growth in the quarter, supported by the successful launch of Borsetto and Paparazzo. Performance in retail improved across all regions during the quarter, with North America remaining the key growth driver. Western Europe and Asia Pacific showed encouraging signs of recovery, while mainland China remained challenging despite a gradual improvement. The quarter was firmly execution-driven, with a refocused product architecture, faster product introduction, and continued upgrades to the distribution network. The House recorded 19 net store closures in the first half, while continuing to invest in the refurbishment of selected stores. There is still work ahead, but the actions taken across products, retail and organization are visibly paying off. Recurring operating income reached €468 million, a 17% margin, up one point versus the first half of 2025. These reflects continued cost discipline, and importantly, it did not come at the expense of investment in the brand, as Luca showed earlier. On slide 24, Kering Jewellery was once again one of the standout performers. First half revenue reached 521 million euros, up 20% comparable. In the second quarter alone, revenue reached 252 million euros, up 18% comparable. Boucheron continued to deliver exceptional performance, reaching new record levels with particularly strong growth in Japan and Asia-Pacific, supported by the successful launch of the new 4XS, variation of the house iconic 4 collection. Pomelato also maintained strong momentum, driven by continued strength in Japan, as well as in North America, and the sustained success of its key collections. Dodo recorded a more challenging quarter against a demanding comparison base. Finally, chilling growth moderated during the quarter, although performance in Asia-Pacific remained outstanding, particularly in South Korea. Recurring operating income was 32 million euros in the first half, a 6.2% margin, up 2.7 points versus the first half of 2025. Beyond the quarter, these results confirm both the strength of our jewellery houses and the scale of the opportunity ahead. On site 25, Kering Eyewear delivered yet another strong quarter. First half revenue reached 965 million, up 8% on a comparable basis. Second quarter revenue totaled 476 million, also up 8% on a comparable basis, with growth supported by all major regions. Performance benefited from a series of high-profile product initiatives. The Lindbergh 40-year anniversary capsule collection, the relaunch of the optical category at Maui Gym, and the successful debut of Valentino's eyewear collection. The business keeps demonstrating the strength, consistency and scalability of its integrated model and remains a reliable source of profitable growth and diversification for the group. Recurring operating income was €222 million, a 23% margin, up 2.9 points versus the first half of 2025. On slide 26, a brief word on corporate and other which is not material at group level. Revenue was up 1% comparable over the first half and down 6% in Q2, primarily reflecting the end of rental income following the real estate transactions, despite a very strong double-digit performance from January. The corporate segment reported a recurring operating loss of 152 million. Now, looking at the remaining lives of the P&L on site 27. Total downrecurring items amounted to a net expense of 223 million in the first half, primarily reflecting costs associated with real estate transactions, but also impairment charges and penalties related to the store closures as well as restructuring measures. Net financial charges amounted to 280 million euros, or 160 million, excluding interest on these liabilities. The cost of net debt amounted to 122 million, down 26% year-on-year, benefiting from higher interest income, supported by the group's strong cash position, as well as lower interest expenses resulting from reduced average long-term debt. As anticipated, the effective tax rate on recurring income is 32.5%, down 3.5% in Polish compared with fiscal year 2025. We continue to expect the tax rate to gradually return to its normative range of 27% to 28% over the next 2 to 3 years. As a result, group debt income from continuing operations excluding non-recurring items reached €355 million. On slide 28, a quick look at CAPEX and free cash flow. CAPEX amounted to €419 million. Excluding real estate investment, CapEx totaled $260 million, equivalent to 3.6% of sales. Free cash flow from operations reached $2.6 billion. Excluding real estate net proceeds and the Gucci Beauty Agreement, free cash flow from operations amounted to $1.8 billion, up 68% versus H1 2025. On slide 29, you can see a more detailed view of the Fricascio generation with one element I want to flag. The change in operating working capital amounted to 602 million, representing an improvement of 863 million year-on-year and reflecting continued discipline in inventory management. Reducing inventory remains a priority, and our 1 billion reduction target for our fashion and leather goods houses by year-end is well within reach. The aim is a healthier, faster-rotating inventory base, freeing up cash while continuing to fund the newness our collections require. This cash generation has allowed us to strengthen our balance sheet, which I will turn to on slide 30. At June 30, net financial debt stood at 3.3 billion euros, a reduction of 4.7 billion euros compared with year-end 2025. Three elements contributed. The €4 billion proceeds from the disposal of Cain Beauté and real estate transactions completed over the period, including the €700 million proceeds from the sale of Via Montaigne-Napoleone. Net debt to adjusted recurring EBITDA stood at 1.4 times, which we consider a healthy level. In the first half, we paid €490 million in dividends, in line with our payout policy. Our capital allocation guidelines are unchanged. M&A restricted to selective bolt-on acquisition, reinforcing supply chain and expertise, and a disciplined approach to shareholder returns. So, growth returning, profitability improving, and a materially stronger balance sheet. That is the financial picture at the half-year. Luca, back to you.