Puig Brands, S.A.

Good morning, and thank you for joining us as we discuss our results for the fiscal year 2025 that ended on December 31st, 2025. Today, we have with us our Chairman and CEO, Mark Butch, and our CFO, Joan Albiol. Mark and Joan will share some brief remarks on the performance, financial results, and outlook. We will then open up the line for Q&A. You will find this presentation, the press release, and other supporting regulatory documents on our website. You will also be able to access a replay of this recording shortly also on our website. Mark.

Good morning, everyone. 2025 was another year of strong delivery for Putsch. We achieved record sales surpassing the 5 billion milestone in net revenue, representing the 7.8% like for like and plus 5.3% reported growth. At the top end of our six to 8% like for like growth outlook for 2025. Gross profit margin improved further to 75.1% despite the impact of tariffs and foreign exchange over the course of 2025. A reflection of our continued strong execution capabilities at scale. Adjusted EBITDA reached 1.045 billion with a margin of 20.7%. This is an impressive improvement versus 20.2% in 2024 and comfortably above our guidance for the year. Adjusted net profit grew to 587 million, a margin of 11.6%, growing 6.5% over 2024. This represents 1.04 of adjusted earnings per share. Reported debt profit was 594 million, or 11.8% of sales, up 70 basis points as we cycled the IPO-related one-off costs in 2024. Free cash flow conversion was solid at 64%. and we ended 2025 with leverage at 0.7 times net debt to adjusted EBITDA, comfortably below our threshold of two times. Joan will discuss our financial performance in further detail later in the presentation. 2025 was another year of strong disciplined execution with net revenues reaching 5 billion euros despite meaningful currency headwinds. Our 7.8% like-for-like growth at the top end of our 2025 outlook range, after absorbing a 2.6% negative impact from foreign exchange, resulted in 5.3% reported growth. Growth remained broad-based across all business segments, with a healthy performance in prestige, while niche showed strong continued momentum. MakeUp delivered a standout year with double-digit performance, We also continued growth into skincare, where strong organic growth in dermocosmetics, complemented by charitable skincare, further strengthened our position in one of beauty's largest categories. Our like-for-like growth included a negative 0.4% impact from the hyperinflation adjustment in Argentina versus a positive impact last year. Despite this headwind, we still delivered strong, high-quality growth aligned with our long-term ambitions. We saw growth across all of our regions with not worthy double-digit like-for-like growth in Asia-Pacific, where we're still underrepresented. Turning to the fourth quarter, we delivered another very strong finish to the year. with 9.8% like-for-like growth, even as we cycled a very strong Q4 last year. This performance reflects the strong demand for our brands from retailers over the very important holiday period and our ability to execute effectively across markets. Net revenues reached 1.45 billion, supported by solid underlying momentum. even as we absorbed a 3.6 foreign exchange headwind in the quarter, an impact we expect to continue into 2026. Looking across the year, we achieved consistent performance each quarter, accelerating into Q4, even while underlying growth in the freelance market moderated into the second half. Overall, Q4 capped a year of robust and balanced growth. To share some more color by business segments, let me start with fragrance and fashion, which continues to anchor our portfolio. Representing 72% of our net revenues in 2025, the segment delivered another year of impressive and resilient growth, reaching 3.6 billion with like-for-like growth of 6.4%. This was a strong performance in a promotional and highly competitive environment, and it enabled us to defend our global value market share at 11.1% for the year. Our growth was driven by continued momentum in Carolina Herrera, supported by the launch of La Bomba, along with excellent delivery from Jean-Paul Gauthier. Our niche portfolio once again outperformed with double-digit growth led by Baguiredo. We continue to hold three of the top ten positions in global prestige fragrance brands, with Rabanne, Carolina Herrera, and Jean-Paul Gaultier reaffirming our leadership position in the category. We also saw strong creative progress across our fashion houses, including the boots at Jean-Paul Gaultier and this Van Noten, and high visibility Carolina Herrera show in Madrid. This Van Noten fashion delivered a notable contribution this year. In Q4, net revenues reached just over $1 billion, with like-for-like growth of 6.2%. This represented a slight acceleration versus Q3, supported by robust holiday sell-in while lapping a very strong comparable last year. The quarter also absorbed a 1.9% hyperinflation impact from Argentina. Overall, this was a solid finish to the year for our largest segment. Turning to makeup, this was our strongest growing segment in 2025. Makeup delivered $845 million in revenue, up 13.7% like for like. The performance was led by Charlotte Tilbury, our largest makeup brand, which had an exceptional year. We saw a powerful combination of innovation, geographic expansion, strong activation in APAC, contributing to consistently high growth. The innovation pipeline remained very robust, with the airbrush flawless foundation and setting spray matte, the Super Nudes collection, and the expansion of the Unreal franchise. At the same time, we strengthened our distribution footprint with Amazon in the U.S. and entered a new market in Mexico. Charlotte Tilbury maintained its number one prestige makeup ranking in the U.K. and number three in the U.S. In Q4, MakeUp generated $276 million in revenue with exceptional like-for-like growth of 26.5%. The quarter benefited from strong momentum across Charlotte Tilbury and the fact that we were lapping a softer competitor. In skincare, we delivered a very solid year with net revenues of $551 million, up 8.9% like-for-like. This represents 11% of the company's total revenues and marks another year of consistent execution. Growth was led by Riash, which continued to deliver double-digit performance, driven by the strength of its hero franchises, Chemoz and H-Absolu, supported by new launches such as Variesan, Invisible Stick, and the Roselian Serum. This was complemented by ongoing growth in child delivery skin care, which continues to be an important contributor to the segment. In Q4, skin care reached $141 million in revenue, delivering 7.9% like-for-like growth. This closed out a year of steady and balanced performance across the portfolio, with strong consumer response to both established pillars and new innovations. Turning now to our performance by region, we saw broad-based international growth in 2025, with healthy demand across all markets. Starting with EMEA, our largest region at 55% of revenues, the business delivered $2.75 billion for the full year, growing 5.5% like for like. This reflects disciplined execution in a frigance market that has normalized from previously elevated levels with continued strength from Charlotte Tilbury and Derma. In Q4, EMEA grew 9.2% like for like to $854 million, an acceleration versus the prior quarter supported by strong holiday selling and solid fundamentals across the region. The Americas represented 35% of group revenues, delivering $1.76 billion and 7.7% like-for-like growth for the year. Foreign exchange was a meaningful headwind throughout 2025, driven by the U.S. dollar and several Latin American currencies, and the hyperinflation adjustment in Argentina reduced like-for-like growth by 1.1%. Despite this, performance remained broad-based across categories and was supported by the launch of shallow delivery on Amazon in the U.S. In Q4, the region delivered 7.6% life-for-life growth to 429 million. We see an improvement versus Q3, particularly in Latin America, even as we observe a 4.5% hyperinflation impact from Argentina. Asia Pacific was our fastest growing region, delivering 530 million and 21.7% life-for-life growth for the year. Growth was strong across Chalo Tilbury, Niche and Derma, and benefited from the up fleet associated with the consolidation of local subsidiaries, an effect we do not expect to repeat in 2026. In Q4, the region grew 18.9% like for like to 163 million, maintaining strong momentum across all key categories. Overall, all three regions contributed positively in both fiscal year 2025 and Q4, demonstrating the strength and diversification of our global footprint. We continue to make progress toward our ambition of being at the forefront of ESG practices. In addition to the rankings and scores that we shared a few months ago, In 2025, our efforts have continued with Apivita renewing its B Corp certification with one of the highest scores ever recorded. We are proud to share that Urias has also joined the B Corp community, marking another step in our commitment to purpose-driven growth. With this, I will hand it over to Joan, who will walk you through the details of the financial performance.

Thank you, Marc. We are very proud of the financial performance of Putsch during 2025. We showed strong growth ahead of the market and at the top end of our outlook for 2025. We improved our EBITDA generation while continuing to maintain a healthy investment level behind our brands. We continued to improve our cash flow management. And finally, our capital structure remained robust, comfortably below our threshold. providing significant flexibility for future commitments. Now let's get into the details. I would like to start by providing you with a summary of our income statement for 2025, where I would like to highlight our net revenue life-for-life growth of 7.8%, our gross margin of 75.1%, maintaining its position as one of the highest in the industry. we delivered adjusted EBITDA of 1.045 billion euro at 20.7%. It is also an improvement of 49 basis points compared to the prior year, ahead of our guidance for full year 2025. Finally, our adjusted net profit was 587 million euro with an 11.6% margin. This represents an increase of 6.5% compared to the prior year. Our key indicator for operational profitability, the adjusted EBITDA margin, has increased to 20.7%. Let's review the drivers. First, we improve our gross margin further to 75.1%, an increase of 19 basis points versus full year 2024. This reflects ongoing operational efficiency and a favorable mixed evolution driven by the growth of niche partially offset by negative foreign exchange impacts and the U.S. tariff effect. Our distribution cost margins were flat versus 2024. We continued to leverage our SG&A expenses, improving by 37 basis points over full year 2024. As we have continued to expand our footprint and own-store network, our DNA as a percentage of net revenue increased by 22 basis points. At the same time, we continue to invest at best-in-class levels of AMP, at 32.7% of net revenues, to support sustainable long-term growth. Our total operating profit reached 812 million euro, an increase from the 759 million euro in the prior year, with an overall operating profit margin of 16.1%, which reflects an improvement of 27 basis points versus 2024. Looking at each business segment, we have seen varied contributions and dynamics. Our fragrance and fashion operating profit amount to €683 million in 2025, compared to €678 million in 2024, implying an 18.7% margin, or 55 basis points decrease versus 2024. This reflects a slightly higher AMP to support growth in a normalizing market and the continued expansion of niche. The make-up segment shows a significant improvement in operating profit, reaching 96 million euro, or 11.4% margin, over 5.6% point improvement over 2024. This reflects the strong performance of Charlotte Tilbury, driven in part by the initial pipeline of Charlotte Tilbury into Amazon in US. At the same time, our smaller make-up initiative continues to prioritize environment with a disciplined focus on returns. It is also worth noting that 2024 profitability include non-recurring events that temporarily reduce margins, contributing to the magnitude of the year-on-year improvement. Skincare segment operating profit amount to 33 million euro in full year 2025, implying a margin of 6%, or a decrease of 1.25% for investors full year 2024. Profitability in this segment was affected by continued investment and integration core reality to Dr. Barbara Storm and other subscale skincare brands, reflecting our commitment to building long-term capability and scale across the portfolio. Overall, each category reflects discipline execution and investment aligned to long-term strategic priorities, with operating margin expanding at group level despite varying dynamics within individual segments. We continue to believe that as we gain scale in makeup and skincare segments, their profitability will have the potential to converge with the group level. Focusing on the bottom line, we deliver a solid performance in our adjusted net profit for 2025, reaching 587 million euro. with a margin of 16.6% up 10 basis points over 2024. This was driven by the strong growth overall business, along with the improvement in operating profit and lower interest expenses on debt in 2025 versus 2024, which was partially offset by the foreign exchange impact on financial results lower income from associate and joint ventures, and the higher tax rate. Reporting net profit grew 11.9%, representing a margin of 11.8% at 70 basis points. This primarily reflects the absence of non-recurring IPO-related items that negatively impact full-year 2024 reporting net profit. Full year 2025 was another strong year of cash generation. Let me take you through the key elements. Our free cash flow from operations improved to €664 million compared to the €634 million in 2024. This reflects the flow through the higher operating profit and working capital improvements. Following a few years of pandemic-related disruptions, this marks our second consecutive year of strengthening working capital performance, bringing us closer to normalised operating level. This resulted in 64% free cash flow conversion of adjusted EBITDA. Our CAPEX remained in line with expectations at 4% of net revenues. Operational cash flow improved substantially to 684 million euro compared to 549 million euro in 2024. This reflects improved underlying cash generation and the absence of IPO-related cash outflows of 85 million euro recorded in the prior year. This year we also had a positive cash adjustment due to a non-recurrent cash inflow from the relocation agreement of our manufacturing facility in Chartres, France. Our net financial leverage currently stands at 0.7 times net debt to adjusted EBITDA, which is comfortably below our 2 times medium-term threshold, allowing us to maintain both operation and financial flexibility. Net debt was €716 million during the period, reducing by over €350 million versus the end of 2024, and this reflects strong operational cash flow after CapEx, payment of €212 million in dividends, a minor stake increase in Cama-Jurveda in April 2025, and also the negative impact from financial flows and leases. We finished 2025 with leverage 0.4 times slower than those in 2024, reflecting a strengthening capital structure and continued financial flexibility. Liabilities from business combination stood at €988 million, a decrease from €1,088 million at the end of 2024. This was mainly due to foreign exchange movement and the periodic reassessment of our future obligations. There were no significant new transactions in 2025. To wrap up our financial remarks, we would like to provide also a view on the timing of expected cash outflows related to this liability from business combinations. As you can see in the calendar, Out of the €988 million of liabilities, the largest cash outflows is expected to happen about five years from now, in 2031, and relating to the minority stakes not owned by Puig in Charlotte Tilbury and Barbara Storm. In 2026, we have upcoming maturities currently valued at €351 million, which will be paid in cash over the first half of the year. even with these payments, will remain comfortably below our leveraged threshold. I now pass it back to Marc for the outlook and a few closing comments.

Thank you, Joan. Before I move into our updated guidance, I want to briefly highlight that in 2025, we once again delivered firmly against the commitments we set out at the start of the year and at our IPO. We outperformed the premium bidder market growing high single-digit, like for like, advance our margin improvement ahead of guidance, and strengthen our balance sheet, all while continuing to invest for sustainable long-term growth. In 2025, we completed our previous five-year strategic plan, communicated in early 2021, which set our ambition to double our 2020 revenue in three years and triple it in five. we exceeded those goals more than doubling our revenue by 2022 and more than tripling it by 2025. Looking ahead to 2026, our guidance framework has been updated to reflect the evolving dynamics of the beauty market while remaining anchored in the strength and desirability of our brands. we remain confident in our ability to continue delivering like-for-like revenue outperformance versus the premium beauty market. As in 2025, we anticipate a negative foreign exchange impact, particularly in the first quarter, but this does not change our fundamental growth ambition. As a reminder, we will also be lapping a strong comparable, particularly in the frequent segment in Q1. we continue to see medium-term upside for adjusted EBITDA margin, supported by mixed evolution and operational discipline. In 2025, we reached a margin of 20.7%, well ahead of our initial guidance, where we expected to improve about 20 basis points this year. For 2026, we expect margins to remain stable. and we have factored in healthy investment levels in our brands while anticipating impact from tariffs and foreign exchange. Our capital structure policy remains unchanged. We will maintain strategic flexibility to finance future growth, targeting a net debt to adjusted dividend ratio not exceeding two times. We also confirm our intention to maintain a 40% dividend payout ratio out of reported net profits consistent with our track record. For 2025 results, this would translate into a dividend of 237 million, or 42 cents per share, subject to shareholder approval at the annual general meeting. Finally, we will continue to follow a highly selective approach to M&A, focus on opportunities that present clear strategic fit with our portfolio while maintaining our capital discipline. In summary, our guidance reflects confidence in the resilience of our business model, the continuing strength of our brands, and puts commitment to delivering sustainable value creating growth. Before we close, I want to leave you with a sense of the excitement we are bringing into 2026. We enter the year with great momentum, and we have an excellent pipeline across our brands, innovation platforms, and operations. Let me share just a few highlights. First, in fragrances, we have an exciting calendar coming from Jean-Paul Gaultier, including a major Haute Perfumerie launch. Gaultier continues to be one of the most culturally resonant houses in our portfolio. And 2026 will be a year of significant creative expression and market impact. We will also continue the geographical rollout of La Bomba in the U.S. in the first half of this year. This will be complemented, as in every year, by range extensions from all of our prestige brands and collections-based launches from our niche brands through to our DNA as a home of creativity. Second, Chateau Tilbury will continue this year with a very strong pipeline of innovation which will further reinforce its hero franchises and leadership in prestige beauty. Third, on the operational side, our Chartres production plant will transition to a new site within the French Cosmetic Valley. This move represents another step forward in scaling our capabilities, improving efficiency and supporting the long-term growth of our fragrance operations. The move will allow us to significantly improve and increase capacity and flexibility in manufacturing processes when compared to the existing one. This project started in 2025 and works will continue until the first semester of 2027 when the opening is planned with no interruptions in production while ensuring the best transition for our people. And finally, in April we will host our first ever Capital Markets Day. This will be an important moment for us to share our new long-term strategic roadmap, our priorities for sustainable value creation, and the powerful trajectory we see ahead for Puig. Please note that we have brought forward the dates. It will now take place on April 14 in Madrid and will be accessible via live stream. Details will be made available on our website in due course. Taken together, these highlights reflect a company that is moving with confidence, innovating, investing, and shaping the future of beauty. We are very excited about what lies ahead.

Thanks, Marc. With that, we come to the end of our prepared remarks, and we will begin Q&A.

The next question comes from Aaron Adamski from Goldman Sachs. Please go ahead.

Thanks. Good morning, Mark, Joanne. Congrats on the results. I have three questions. First on outlook, could you please give us a sense on what is your latest read for the premium beauty market growth rate year to date? And in that context, how are you feeling about consensus expectations for 5% organic growth in 2026? And given your comments, would you expect the growth to be weighted towards the second half of the year? Second, on La Bomba, which you briefly mentioned, can you give us an update on how the consumer replenishment is tracking for this launch since you have launched it a few months ago? And how many outlets have you reached with it so far in 2025? And how many additional points of sale do you expect to add in 2026? And third, the last question on Charlotte Tilbury. Can you give us a sense of how this brand is performing in its existing outlets and how much of the growth is driven by the distribution footprint expansion? And if you could, what are your expectations for makeup growth this year? Thank you.

Thank you, Aaron. I'm going to start in reverse order. First, Charot Tilbury. Charlotte Tilbury is a brand that even in those markets where it has a long history and high rankings, like the UK, is still distributed in much less number of doors than its main competitors. So it is obvious that as we progressively expand distribution, It will eventually lose some of the sales in those existing doors. But we still have plenty of room for expansion, and that's one of the reasons that the brand has been growing. Your second question regarding La Bomba. It takes time for a pillar, as we call it, to prove its validity. When we look at the sister line, Good Girl, that we launched in 2016, it reached its top rankings just last year. So it took eight years in this case. Our initial results for La Bomba are very promising. We have launched only in a few markets in Europe and Latin America. This year we're going to launch in the U.S. So it's going to be a significant largest market in the world, a significant upbeat. And so far, the indications and the results we have are very promising, and we're very happy with this launch. Regarding the outlook, we... It is clear that you're asking from the premium beauty market, and I'm going to talk more about the fragrance market. We have been living, both in fragrance particularly and the premium beauty market, on a super cycle, as some of you call, since COVID. And we have... We see tailwinds, particularly... for the fragrance category because there are many trends that we have seen emerging in the last few years that give us confidence that the category will continue growing faster than the many other consumer categories. The challenge is this transition from super cycle to normalization, it's more difficult to predict. And that's the challenge that I've seen also in some of our peers when they are talking about 2026. What I can say about 2026 is that we think that current consensus for our growth is not understandable. I think this answers your question, Aaron.

Yeah, that's very clear. Thank you very much.

The next question comes from Jeff Stent from BNP Paribas. Please go ahead.

Good morning, gentlemen. Just one quick question. Barbara Sturm, can you just please comment on that? I think you only touched on it from the margin perspectives, but just how things are going there and whether you remain confident in the outlook for Barbara Sturm. Thank you.

Thank you, Jeff. We have explained oftentimes that when we buy or partner with a brand like this one, it takes time to bring it to the level that we think it should be. In the case of Barbara's term, there's been a number of steps that we have taken so far. We pruned the portfolio. We reviewed distribution. Barbara told us that she had expanded distribution a little too much prior to selling the company, so we have pruned also distribution. And in the last 18 months, we have been integrating that company into our portfolio. So that means that there is a certain transition since we take over a brand and we see the situation in reality of the brand. Having said this, we are firmly confident of the potential of this brand as we were when we bought it. And we know it takes time. That's one of the reasons why we think or we say that in premium beauty, you have to have patient capital that can be, you know, comfortable in taking time when you have to build brands. I hope this answers your question, Jeff.

Yeah, no, that's great. Thank you.

The next question comes from Celine Panutti from JPM. Please go ahead.

Thank you very much. Good morning, everyone, and congrats on the grade 25. My first question relates to the fragrance division. So you had a strong quarter four, and I think, you know, you mentioned La Bomba additional sales there. But you also mentioned that the fragrance market was slowing into year end. So I just want to understand the selling benefits that you had in Q4 and what does that mean for Q1? You mentioned Q1 at a task comp. Do we expect some rollback in Q1? I don't know if there's a, to which extent we can have that. And maybe also on fragrance, Mark, you seem to mention the transition between super cycle and normalization. Beyond the Q1, what kind of visibility you have for the year on the fragrance category growth? My second question is on some of the moving parts on the P&L. Can you talk about what was the impact of tariff and effects on gross margin in 2025 Do we double that for 26? And on FX, it was unclear to me, you mentioned that Q1 would be as Q4, but can you give us an impact on FX for the year? And then maybe just as well on that point, if you could give us as well some guide to understand the moving part in net financial and associate income for 26. Thank you.

Thank you, Celine. Many questions. On fragrance, we had a soft Q3, and when we talked to you in September, the expectations at that point were a little bit more moderate, let's say, and then we saw a compensation in Q4 that accelerated from that time. Now, sometimes it's difficult to when you have Q3 and Q4 in our case, given the penetration of fragrance in our portfolio, you always have Christmas season in September. Cat at the end of September could be earlier or later and can have an effect on Q3 and Q4 momentum. So in that sense, I think that we saw a Christmas season that was a little better than what we had anticipated and in spite of a quite aggressive promotional activity from many of our peers. Regarding the transition between supercycle and normalization, as I said, it's a little difficult to project how this transition will be. As I said, we're confident about the category because, remember, many of the trends we've seen in the past few years, whether it is the potential in emerging markets, because when people go from low class to middle class, fragrance is one of the first categories that they are attracted to. We've seen the young crowd through TikTok, particularly teenage boys jumping into a category. We've seen the social network growth. curiosity over fragrance has had an impact in sales. We've seen many emerging, many markets where the culture of fragrance was not very developed the young generation is jumping into that category and whenever people start using fragrance where it is you know you know occasional usage or as part of your routine people don't go back it's very sticky so those all those trends give us confident that The category has momentum, has tailwinds, and the challenge is to predict how the super cycle will go to normalization, and that's why I think 26 is in that year. So that's why we're a little reluctant to give numbers yet, and what we can say is We are confident we will be able to keep growing faster than the casualty as we have done, or the industry as we have done in many of the past years, but more difficult to give a specific number. Third, on tariffs and impact on gross margin, as you saw, we were able to... absorb in 2025 the impact of tariffs as well as the impact of foreign exchange. Our gross margin increased last year in 2025 versus 2024. In 2026 there will be a full year impact and our projection is that we will be able to absorb the impact that we'll have both in foreign exchange and in tariffs with the operational efficiency and some of the evolution of our mix. In terms of, yeah, you were mentioning the Q1 and in foreign exchange it's difficult to project more than Q1 because I don't know what the different currencies will do. The effect we expect for Q1, it's going to be similar than what we saw in Q4. last year, around 3.6% foreign exchange negative impact. Finally, regarding net debt. Yes, regarding evolution of net debt, no? Of the different, maybe, Joan, you want to comment on that? The question was on associates. On associates, evolution of net debt. Net debt on the business combinations, I understand, no? No? Sorry, Celine, can you repeat the question? Is that possible?

Yes, absolutely. If I look at 25 below the EBITs, your net financial came ahead of what we had and associates came a bit below. So I just want to understand how to look at that for 2016.

I think this refers to Israel. After years of high growth, this year I think has had a flat year and we have had a negative impact in the profitability due to these flat sales and due to some LATAM currencies. This trend, it's difficult to predict in terms of the impact of LATAM currencies, how this will evolve, but we think we'll continue a similar trend. So we think we'll be – associates will move similar this year. On the other side, we have had very good – performance in Granado, so we think that this will compensate any potential reduction in ISDIN. So in general, we think it will be stable. I don't know if we answered your question, Céline.

Yes, thank you. Anything on Net Financial, please?

On Net Financial?

Yes.

No, I think there is nothing. As we mentioned, there is some outflows of the liabilities we have in the first part of the year, basically because we are buying part of the percentage that we have with Charlotte Tilbury, and we have indicated in the presentation that we have an outflow of $351 million. extraordinary this year that is related to the increase of our participation in Charlotte Tilbury. We'll end up with 85% of the company after that. Other than that, I think everything stays similar that we will have this year.

Excellent. Thank you.

The next question comes from Fernando Abril-Matrell from Elantra. Please go ahead.

Hello. I'm sorry. Do you hear me? No. Okay. Now, so just a quick follow-up on the last one on Associates. So you've mentioned that sales were broadly flat in Eastin. I've seen the report, but profits are down. YouTube Forex or is there any other one-offs or extra investments that you've carried out in fiscal year 25? Then a couple of more questions on working capital. So as you said, this is the second consecutive year of working capital inflows. So how should we think about working capital dynamics in 26 and whether you see there is room for further improvement or should we expect some sort of normalization from current levels? The last one on gross margin, so you've mentioned the growth in the niche, but I don't know if you can comment on the sales mix. I understood that makeup typically has a higher gross margin than the group average and whether this was also a notable margin driver for fiscal year 25 or not at all. Thank you very much.

Thank you, Fernando. First question is in the flatty sales and evolution had an impact in the results, but mostly foreign exchange impact from Latin America currencies was what had biggest impact in the P&L. In working capital, At the time of the IPO, we did mention that due to the inefficiencies built after COVID, because there were problems of supply and very high growth, we had been investing in building up stock to levels that were above what we had typically had in the past. And we said that we'll take about 18 months to normalize and that's why last year we had a good cash flow benefit from this normalization of working capital and this year we have continued to do so. We are closer to normalization, so going forward we'll see a normal path in terms of, you know, cash flow generation through working capital improvement. There's a little room, but much less than we had in the past. And then finally on gross margin, it's true that some of our niche has been growing faster. We mentioned in our notes that it has been growing at double digit and niche has a higher gross margin in particular because a certain percentage of the business that we do in niche is direct to consumer. as well as the make-up, there is a higher gross margin, so the weighted average combination is benefiting from the evolution of our mix. Fernando, I hope that answers your questions.

The next question comes from Tom Randall from Jefferies. Please go ahead.

Morning all. Thank you very much for taking our questions. A couple if I may. So first of all, one of your peers had said that the luxury fragrance category grew around 5% in 2025. But you've indicated this morning that your share has gone from 11.5% last year to 11.1%. So do you mind just walking us through that? those dynamics and maybe let us know what you saw the fragrance category grow in 25. And then if you did lose share, where was the share lost, which kind of markets or channels? And then secondly, regarding the makeup segment, so should we expect a slower start the year in makeup in the US or in total as retailers find the right level of inventory following the Amazon launch? And should you expect any kind of unwind in makeup following the launch? Or should we see those Amazon sales as mostly incremental? Thank you very much.

Thank you, Tom. In terms of luxury fragrance evolution, we showed last year our market share 11.5 and this year 11.1. It's true that every year we try to improve the measurement of our market share, and in our internal numbers we have lost a little less than what this 0.4 gap shows. Last year, there was a very, in certain markets, a very aggressive promotional activity from some of our peers, particularly in markets where we have high market share like in Latin America. And that was a dynamic that we didn't necessarily follow, which proved that we might have lost a little bit of market share because of that. When you look at our evolution of market share over the last two decades, if you want, We went from 3% market share 20 years ago to 11%. And with our formula, own brands, creativity, designability, storytelling, and we have been able to continually, progressively gain market share. Maybe it doesn't mean that every single year we have done so, but as a whole, we still believe Our formula allows us to keep winning in this market in spite of maybe last year was a little bit flattish. In terms of your second question, make up, we had a very strong Q4 and added with the Q3 and the launch in Amazon. was a strong end of the year thanks to a very powerful Christmas campaign that resulted in good response from consumers. Now, for Q1, we have mentioned that, and that's for makeup but also for the other categories, We had a very strong, I mean, we are lapping a very strong Q1 in 2025. We have an impact on foreign exchange that will impact our reported sales. So we see probably a softer Q1, but we're confident on our overall year for next year. Tom, I think I hope I answered your questions.

That's great. Thank you very much.

The next question comes from Jose Rito from CaixaBank. Please go ahead.

Yes. Hi. Good morning to all. So I have two questions. The first one on Charlotte Tilbury. So I think that in Key4 we had a strong contribution also from Amazon as it was the case in Key3. My question is if this will prevail in the first half of 2026 and if you intend to have or planning to have a big retailer launch such as Amazon in 2026. That will be my first question. Brenda? The second question on APAC sales evolution. So it was quite strong in Q4. Just to see if you can provide any color in terms of if all divisions had a strong performance in APAC or if this was also driven by MECA. Thank you.

Thank you, Jose. First question regarding Charo Tiluri. It's true that last year, particularly in the second half, we have the launch in Amazon, but as I said, in general, So, Charlotte Tilbury is a brand that is much less distributed than many of its peers. There are many markets, you know, Latin America, we have only launched in Mexico. Travel retail, we're only starting last year to really enhance our presence. There are many markets where we have launched only in one or two exclusive retailers until we expand. And an example is in the UK where the brand is number one retailer, we're not present in boots and we are going to open a few boots this 2026 for the first time. Not all because it's a huge network, but we're starting to open boots in that market. So it's a proof that the brand still has legs to grow. Regarding the APAC we have probably of the companies in you know our peer companies we are the company that has a less penetration in APAC and since we have been evolving our portfolio in a way that is more aligned with some of the needs of APAC markets, we see continuous opportunities to grow in APAC. And this year, the last year, we had an additional benefit, which was the consolidation of some of the subsidies that we had been opening during the year or the prior year, which will not be repeated this year. But in general, APAC is a territory where both makeup, skincare, niche fragrances, or overall fragrances have potential to keep growing. I hope that answers your question, Jose.

Yes, sure. Thank you. Thank you very much.

The next question comes from Jie Zhong from Alpha Value. Please go ahead.

Hi, good morning. Congratulations on the strong result, and thank you for taking my question. Actually, most of my questions are already answered, so one left for me, please. So, Mark, you mentioned that at the end of presentation that you will stay active on M&A. Could you share a little more which category you are looking more actively, so this year, 2026, please?

Thank you. Jai or Ji? For your congratulations. I like that. M&A. We have always said that we don't commit to the M&A in organic growth for our future growth because we don't want to be slaves of our words. It's true that when you look back, M&A has been an integral part of our growth. The challenge is that we only get excited with certain brands that we believe have potential, have a story to tell, have a reason to exist, and then we get excited. So going forward, we do about 100 things a year. And in some years, we don't pursue anything. Others we do, and because there's an option, we don't necessarily win. So we are actively looking, which doesn't necessarily mean that something will happen. That's, I guess, what I can say.

Okay, thank you very much.

Thank you.

The next question comes from David D.A. Meyer from CIC. Please go ahead.

Hi, good morning. Thank you for taking my question. Actually, I have two main things. The first one on Latam, which is an important market for you. I was a bit surprised to see that in Q4, you mentioned strong performance in the last quarter. because one of your peers mentioned recently that that market was a bit slowing down at the end of last year. So it was mainly due to the launch of La Bomba on that market. So that was my first question. And the second one, on your prestige segment, can you give us more color on the performance in the full year of your main brands? Like Rabanne, for example, it seems that the brand is losing some momentum. It's still a billionaire brand today. Are you confident, for example, to see Charlotte Chiburi reaching that threshold this year? Thank you.

Thank you, David. LATAM, we have, you know, that's the region of the world where we have the highest penetration of our brands. And particularly, Carina Herrera is in fragrance number one in every single market, if I'm not mistaken. So the launch of La Bomba evidently has had a positive impact. On top of it, some of the promotional activity that other brands did in the past few years because we saw energies and resources channeled from APAC. to LATAM by some of our peers, and that was an area that was affecting us the most. But this, you know, as you anniversary some of these events, we saw the benefit from not having to, you know, from the same situation than last year. So overall, LATAM had a good performance for us. When you say if you can give a little more color on prestige, it's true that, look, our brands, we have 17 brands in our portfolio. And we have proven, because we are very good at creating the desirability behind our brands, at surprising consumers. But brands have cycles and what the advantage of having a portfolio is that you have some brands that have momentum one year and less momentum the other. So it's true that in our case Rabanne has been softer but we have, you know, very good pipeline of ideas going forward and confident that we will be able to manage the portfolio in a way that overall we can keep beating the market. With this, David, I hope I answered your questions. Thank you.

Thank you all for your questions today. We look forward to speaking again at our Capital Markets Day on April the 14th, where we will also be discussing our Q1 sales. Thank you very much.