Philip Morris International (PM)

Nick Rolli Vice President-Investor Relations and Financial Communications
Jacek Olczak Chief Executive Officer
Emmanuel Babeau Chief Financial Officer
Chris Growe Stifel
Pamela Kaufman Morgan Stanley
Vivien Azer Cowen
Bonnie Herzog Goldman Sachs
Gaurav Jain Barclays
Jared Dinges JPMorgan
Call transcript
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Good day, and welcome to the Philip Morris International First Quarter and 2021 Earnings Conference Call. Today’s call is scheduled to last about one hour, including remarks by Philip Morris International management and the question-and-answer session. [Operator Instructions] Media representatives on the call will also be invited to ask questions at the conclusion of the question-and-answer from the investment community. I would now like to turn the call over to Mr. Nick Rolli, Vice President of Investor Relations and Financial Communications. sir. ahead, go Please

Nick Rolli

you release us. our containing quarter thank issued XXXX today, a results. press detailed for and Earlier joining we first Welcome information on

that are products, Ukraine. organic slides, including comparisons introduce Chief Fertin www.pmi.com. access Financial review now the Officer. In forward-looking entirely Chief Vectura a from heated as you, to press XXXX, X stated, RRPs, tobacco presentation are and my Today’s pro smoke-free of to Growth projections results our to are directly and adjustments, operating our which Babeau, It’s reconciliations Pharma, and data excluding glossary or release On reflect comparable Wellness may and IQOS Fertin and and separately of exclude to future as results. our operations various Cautionary a for Healthcare March we of contain at on are acquired presented Executive today’s factors presented unit launched these pleasure on and PMI’s website. differ rates calculations to of business statements business the results remarks which You segments. and of IQOS and cause reported this products, I forward-looking actual basis of your from Emmanuel and market all new the RRPs. disclosure well Figures today’s managed consolidates for evaluated Forward-Looking Other basis to terms, XX, on entities. Russia Statements are Vectura business, the heat-not-burn OtiTopic. Olczak, additional to to and the forma to and could currency-neutral references Over category. in an otherwise the other Pharma, or materially U.S. Business new quarter attention Healthcare definition Jacek. Jacek Officer, XXXX, a and the reduced-risk measures webcast The operations projections are in on statements. A third results the we posted adjusted end in our Unless the most of products release acquisitions. references direct GAAP geographical Group all Wellness

Jacek Olczak

Ukraine. and would I Thank everyone. and tragic you, you of us and challenging solidarity war Nick, many have all Recent like people welcome been our are express months events safe hope to sadness the of Ukraine. for related for I the in given to well. extremely the

we their been is and our and Our them, have primary concern doing we support families with employees priorities. for everything can three to

First, from fighting. evacuating the over evacuated to heaviest supported move locations our more from away colleagues, to X,XXX from members family the colleagues X,XXX than and others and zones country have conflict we

decided to aid accommodation, critical who providing or delivering and are that we remain Second, cannot assistance to immediate forward in third, who country. people left to Ukraine. those And the path leave are we a

additional the of on around ambulances initiative, of donated directly this organizations we Projects through cost items million year. $XX additional medicine, and support our hospital. food, With the XX a funds have the mobile clothes, employees an a of contributed country, essential of estimate our and in employee-led population, and the Heart. items broader colleagues to we Based around to other humanitarian providing addition, current In own to million purchase to includes set-up and variety This $XX visibility, a for across and our already

support people continue provide to countries arriving to Our from vital colleagues neighboring to refuge. Ukraine seek in all

at a such Our efforts heartfelt gratitude these in time. goes involved generous everyone help to difficult to

Ukraine operations, production Kharkiv on suspended. remains the manufacturing of impact our facility terms business at In our in

as allow to some seen been in on impacted, Ukraine where inventories While to resumption existing Eastern mostly heavily have conditions availability we and maximize hand. seek activities in we using consumers, product service have business areas

locations, involve other now import from products this although to may are higher planning costs. We also manufacturing

and We in-kind continue to them substantial pay families. salaries to all their our to and Ukrainian to support employees provide

in PMI’s is while to and of directors release, in market Russian introduced in is board also we our throughout of employees in working chain on and the business but orderly disruption, this regulatory has QX. of legislation, in Russia Russian task period. team as and executive are a the March that easy to in viable usual XX exit operating committed in clear regulatory exit communicated we already rapidly are recently and to path As manner complex an environment. press options supporting complex of a continue light view seeking market context supply senior This changing which business the It the our cannot impacted no

taken product investments and concrete including our have back scale cancellation to new We launches, as ILUMA such the of steps operations, and IQOS all VEEV. IQOS

Marlboro Parliament and We our of including products, are SKUs. delisting XX% cigarette

to conflict chains canceled capacity also manufacture created certain in materials pressures disruption billion our TEREA inflationary have ILUMA and also for the ultimately exacerbated Clearly, global has XX of in million investment impact than in $XXX the the factory. sticks and We in IQOS services. more Russian supply

detail. of full in forma both these provide we and now two adjusted from a cover a Ukraine performance basis hand conservatively provide assumes the from Russia X. guidance uncertainty also the contribution over Ukraine given from markets, QX year. and view, further basis volatility our I However, and consistent Emmanuel or April and Russia on To Russia business pro prior Ukraine for excluding our results will outlook will to the remains current this On no excluding reported and a strong. and outlook more now to

Emmanuel Babeau

from in prior results We our currency-neutral double-digit strong of adjusted pro a revenue Thank EPS Ukraine on the net you, and Russia basis, Overall both and current QX, were a quarter. also organic Jacek. with delivered and performance year very diluted currency-neutral excluding expectations. growth ahead forma

quarter last the Our as seen an excellent device constraints ease. delivered reacceleration to supply IQOS business continue continuing quarter,

excluding than the of pro IQOS total by RRP a Our XX%, very X million Ukraine, with company. smoke-free net marking revenues and performance. forma grew strong net revenues pro user XX% base over by grew forma Russia more

very volume HTUs geographic impressive our income latest as for Spain. present robustly, HTU organic these to are of the middle combustible launch IQOS growth. markets markets company. the forma for in and in in of Japan efforts our in The exciting initial The in markets. plus nicotine different growth take-up reflects continued and on Importantly, exceeding reaffirms and continues excellent start year prior trial market success ILUMA shipment is driver adoption. drive low in largest our three growth pro encouraging Japan Region, second over PMI quarter. as and consumer This with very well an IQOS as the XX% Switzerland, now and ILUMA Meanwhile, in brand future share innovation, volumes objective XX% in confidence our revenue growth portfolio EU delivering progress positive our grew where our expansion as category net business and stable performed initial compared

bottom strong year a XXXX, currency supporting this adult we growth. smokers maximize performance, ability expect deliver financial to to another our of and also is alternatives. is start to our enhances to off and unfavorable while line the business Overall, strong in addition organic In top smoke-free to robust switching of

the headline against of XX% total basis. on volume in the revenues strength by This timing the the including plus inventory comparison pandemic-affected impacts, movements. a QX of plus ongoing some our to reflects numbers, and net and many by pro driven growth underlying X% recovery combustible grew total markets forma organically business IQOS, Turning positive in a

proportion at or X.X% Indonesia. pro grew around unit per revenue our Combustible by expectations was X% basis, net also IQOS pricing device of forma and X.X% sales pro a organic higher plus the total increasing X.X% forma by mix, above and volumes, Our in on plus excluding HTUs plus pricing. driven

Ukraine. Our total income This operating points and compared mostly QX timing lower excluding XX organically where year due margin was basis gross Russia margin to declined comparison reflects a by factors. prior a by basis to higher adjusted tough XX productivity points and

sales ILUMA. QX replenishment higher our increasing were IQOS in impacted earnings, user flagged full As margins channel by IQOS year and acquisition, device for

for and of enabled our including of Despite us diluted ahead temporary representing with to challenges, unfavorable margin timing effects This expectations, year. improvement was adjusted of and an the impact $X.XX. and air net use efficiencies currency from increase wages materials cost of This growth. increasing the size ILUMA these the we $X.XX, the in and of and deliver saw $X.XX, as in the previously, by IQOS, even is of XX% around growth. of currency-neutral production, revenue war plus chain, currency-neutral in comfortably unit cost expected our certain including benefits energy, our initially of cost of EPS strong of accounting mentioned As with consumables direct positive exacerbated higher Inflation weight combined we up pricing, Ukraine. supply ramp freight, elements also device next was

adjusted our forma XX%. plus of Ukraine, $X.XX and pro diluted grew Russia Excluding EPS by

now outlook. our Turning to XXXX

As these With excluding growth for underlying now Jacek our Russia two given strong. entire markets the outlook forma basis we an of our reaccelerating, mentioned, are on providing and Ukraine, a visibility on lack fundamentals pro the year. adjusted business remain

certain the in XXXX for due X.X% to a for PMI, the hyperinflationary recovery. part compared our an risk slower to which expect materials, on Turkey. build-up previous is of billion. capacity $XX.X designated from the was TEREA incorporates total growth adjusted to the net we pace deliver forecast the net chain ongoing drag and X.X% of despite approximate pro somewhat Importantly, cancellation disruption device This of remaining uncertainty trajectory to revenue plus revenues full supply pandemic range availability, to accounting for production plus organic the of production in Russia, above This of forma half-point shift export,

organically XXX the operating income full plus zero year. higher for to pro forma margin our expect We be to basis points adjusted

achieve organic translates billion diluted adjusted forma initial an range expectations billion Despite EPS prior This strong diluted PMI billion X these sustainable to expect growth of We forma The added compared our expected to headwinds, pro our of the in easing adjusted constraints a initiatives units. a growth underlying mix plus and higher and we ILUMA. then, at increased such we prevailing total to On gross we in implies freight in XX additional observed for the both prior in the expect lower $X.XX, of rates. between full HTUs supply units the representing impact the nearly disruptions remains supply raw Ukraine prices, we basis, to over currency-neutral margin XX.X margin that costs select remain of currency also temporarily X, million guidance for have IQOS the year. favorable $X.XX have impact. product X% Ukraine we shipped inflation mentioned revenue increase we XX and device shipment February, pro provided outlook year and products. around dilutive $XXX at As EPS exclusion XX% full compared including and a plus total to sales XX new volumes, currency our around costs a our diluted to we year accretion. and XX%, further previous also unfavorable for guidance. XXXX expected material innovations EPS a cost April and into forma assume plus conservatively the growth to from units margin savings no uptake excludes unfavorable billion and deliver Russia an pro Since plus incur of impact. will This war-related pro transportation HTU and forma to above $X.XX contribution including reflecting temporary $X.XX results, difference invest incremental and Higher due chain of QX, a as energy and of of growth estimated pro increase of tremendous cigarette fast confident Russia forecast XX COGS primarily XX% this in growth, This $X.XX ILUMA, forma adjusted with billion initial device while further in and air of excellent. of deliver IQOS expansion as from unit outlook an and to billion year

explain forma expect modestly be I’ll continue shipments as pro HTU the in later. to second year, after of lagging We ahead IMS to behind for the quarter

outlined there a in of release, other today’s our underpinning number are As outlook. assumptions

to and U.S. up Russia, volume We China, total decline of and industry excluding by cigarettes HTUs, the to Ukraine, minus X%. expect

in pro range in and Given due pro therefore combustible The a adverse our disposable combustibles, leadership of in ongoing year improving, X%. structural Turkey. hyperinflationary as as pricing expect in the pricing challenges remain stabilizing target now growth PMI assume products, We shipment from is Indonesia, within category environment well plus positive to the although X%, flat forma of growing smoke-free we income impacts pandemic-related including of full and including proportion our forma in gain the around accounting share its plus volumes, pressures. to share. to We total business, impact

and other to Our include cash operating in tax XX%. a assumptions XX% around effective flow rate $XX of billion

continue volumes Ukraine, returning to we full-year capital our this around strong forma the We shareholders in a for ease, pro part, the remain growth we impact year, in reflects steadfastly and with inventories cash performance adjusted the accelerated replacement Japan. acquisition to EPS diluted billion. expenditures this a war recovery we as to committed as remains $X in half. supply With dividends with expect IQOS opportunistic device ILUMA and the and constraints the and overall, of expect repurchases. expansion user margin of channel of robust to of to we balance In HX weighted cycle reacceleration sheet sharp through regard share large the replenish phasing second device Despite supply

price and ILUMA to acquisition, drive addition, including the our the portfolio prior average LIL is In than our year, of ONE. commercial lower device stepped-up with reflecting activities broadening device

premium our high signs to notably net temporary share. the and to of encouraging benefits. as low to pro be to devices Ukraine, by factors, expect We to Organic shipments certain of SKUs short timing later the risk exchange continue or be stabilizing of are certain with of shift to supply meaningful in various be delayed shipments of timing where disruptions rate accounting contribute approximate chain specific in products seen there making adjustments priced is and other in growth specific reversal notable be Japan of including a factors a expected on from services, impact in markets, to the with combined forma While cigarette the markets. cigarette adjust a to including prevailing flows further our drag timing accentuated. comparison the of point impacted have will we select an on to discounted materials offerings, QX with logistic Turkey, QX category a to our competitive the at QX reorganization the already reflect situations chain supply and number hyperinflationary global we in out-of-stock growth, certain HTU some we heavily to The and the effects war availability may flows of Moreover, materials. X is single-digit, revenue

partly forma pro QX, QX, XX.X shipments billion This planned. forma of to compares PMI total expect HTU pro billion We around XX less around XXXX. X to originally billion reflecting shipments in HTU than in Japan

acceleration to growth these X expect fourth HX, a units in to billion third the further move We quarters. generating and

In we powerful an currency-neutral at first of forma including $X.XX performance unfavorable X% growth a million, significant over the year. $X.XX, with with temporary mix tandem impact of increase headwinds, expect is to the bottom-line expected lower operating HX scale contract of cost other margins, drivers the top $X.XX $X.XX margins organic costs will For shipments of and prior disproportionate investments growth, top to strong catchup HX, of in quarter, quarters. our commercial growth over pressures EPS to freight expectation QX line HX should margin reacceleration impact line inflationary forma second dynamics to in and to strong shipments costs, in rates. in to $XX in in pricing, negative prevailing compared of are coming of our deliver to In adjustment combination user as accompanied air in This pro recovery of chain growth. and the pro diluted In the represents be of reflected supply we by and the adjusted organic currency device quarterly pro X% acquisition IQOS the the half. before forma X% further, receding support step-up Japan, outweigh a deliver corresponding efficiencies, expansion These an to highest impact of X% overall. of expected the the acceleration

deliver more us billion of growth. in around track pro diluted firmly gross XXXX on pressures. places CAGR on We $X more especially on basis track organic strong revenue in growth, global XXXX, than X% in to outlook XXXX a than is Our forma and adjusted EPS currency-neutral targets by X% to given net important cost savings remain inflationary which deliver our XXXX,

confident by our intact. to of rapid net remains XXXX a revenues pace We Importantly, majority the become our smoke-free remain business transformation. ambition in in

forma. the shipment our a cigarette pro business strong transformation pro pro the tobacco plus year Turning supply-driven reaccelerates at by forma increase results, XXXX. towards total as the continued user the in X.X% of increased The broad of in reflects as total acquisition an PMI comprised volumes forma volumes X.X% rapid from our in continued and shipment forma pro reflecting back XX.X% by total smoke-free industry to of almost recovery plus of volumes Heated total growth on XX.X% slowdown; and of category a XXXX This our quarter, and first basis share. X.X% based QX XX% products full to pace. units of continues compared QX our

XX.X% engines reflecting net plus rapidly, evolving and over delivered up QX volume line. also pro our driving shipment forma volumes Smoke-free year-over-year ILUMA growth growth is plus performs XX% revenues of forma XXXX. QX higher approximately of in as organic twin as device net of QX, pro X.X%. IQOS ease strongly. on mix constraints X% of reflects forma XX% revenues devices We of company. revenues, net $X.X billion sales supply pro the growth for our top This smoke for become in total made accounted full free compared we to the year majority Our RRP

by led pricing, is first combustibles. The

in regulatory the at per growth; powerful higher business is increasingly mix accelerates. projects our driver unit, of to second increasing deliver substantial our which continues as net transformation revenue an The

our OI to forma margin, which points. declined by basis pro turn now QX of driver Let’s the XX

the gross factors costs due of Our our programs. We million decreased mentioned target organically margin over first us line quarter, for in the COGS administration Conversely, basis reflecting $XXX inflationary successful leverage million with $XXX over This the marketing, better reinvest This and forma billion research continuing around around $X mitigate of cost the halfway growth makes to by savings SG&A. our already XXXX, since and generated $XX IQOS XXXX. operating in top towards pro pro pressures in and around were million of margin XXX I productivities billion earlier. forma to positive XXXX, points organically, cost progression. points $X from basis in deliver solid to gross start adjusted while growth, XXX allows efficiency and

continue as and well to programs, accelerate growth commercial number engine as in investment and a categories We across digital R&D, of geographies. opportunities our

we improve as expect As progression ease. year our year over and the margin operating temporary reflected our the of guidance, in headwinds course full comparisons to tough

volume combustible forma supporting Philippines, notably in this in well travel stable year. portfolio our Indonesia growth in Duty recovery pro Southeast Our revenues. and expectation supported Free. the organic and robust This Spain organic and volumes volumes an in in and a further broadly region reflects Asia growth South net revenue with Increased net performed and growth also QX, of

our year-over-year X.X bear fruit of This in portfolio Marlboro in higher. initiatives QX Japan, combustible social includes point Free a to Turkey gain a share forma X.X category Our gains basis. consumption plus and and as recover the with Duty resumes points plus share on pro continued with

switching despite target time, to continue our declining leadership cannibalization. impact category to helps to the over IQOS maximize stable smoke-free of is the combustibles over category we a While and products, in time, share

in Russia includes Poland. number IQOS create in including they markets. delivered HTUs ongoing with Germany share of our terms and portfolio in the and are overall market momentum. This one largest brand a growth gains are now, the Egypt, share now where Free, our excluding share Ukraine. continued PMI pro the nicotine in second expected, present QX X.X% position six as Duty gains positive markets forma for We In Italy,

in also reached X.X% small products. market users includes shows as slide of Poland. seasonality ILUMA. users which selection performance in to We combined gain QX inventory and standards. growth highlight representing the offtake Russia QX. constraints brand, XX%. strong including of IQOS an with the quarter, users, where key continue also want million and a reflects have HTU Region, growth Lithuania very performance tobacco first with city stopped adult more In again than give MRTP the our IQOS and This Ukraine, region, that the usual to movements from volume, the by evident December this user timing conversion. of the X of of of switched strong the many of approximately HTU device forma estimated March share Adjusted result demand of in movements. historic I estimate impressive inventory expect on a as users smoking, exceeded smokers the a quarter notable to share our X, share Ukraine shares. further supply sequential latest X.X excluding full XX.X XX, underlying to range To EU to pro in order phenomenal total with we receded, QX products of was estimate very Region, some quarter volumes million the or resumption first national and continue consumer the IQOS performance, in and now color programs as there the stages contributions IQOS were a noting combustible We IQOS classified progress for expected by cigarette at points, XX, the recent HTU now the driven million Moving million were of Hungary that is XXXX. this This IQOS in markets had good XX% Russia capitalizing by the robust in the and sequential very a we second X the benefit especially and as with lower on across share balance industry to various the modified FDA’s also volume exhibit of growth, also from of for and reversal start IQOS encouraged IMS EU risk outside total Italy XX.X of authorized This

While introduction of also Athens ILUMA. Vilnius the for the share, and Budapest, HTU IQOS XX.X% and well In launch increased doubling in mid-to-high of record X% Vienna points are Rome share; at key pleased a QX. XX% and share performance cities. driving the continues strong our into XXs. Tokyo to Japan, also the in in which we brands Zurich approaching way, notable traction is than the further are to and a Elsewhere, X%, in especially more to other gains acceleration the adjusted This X.X strength London our over of plus lead by ILUMA, by with reflects the portfolio

in reduced earlier, below chain We despite shipments consequently touched I XX% in we share, year. HTU result second shipment expect a year. strong this seasonality strong offtake prior likely HTU on will Conversely, expect HX in trends to and in supply effects. With QX, the constraints expect growth market excellent continue inventories as reaching in QX such HTU replenishment substantial with substantial around quarterly deliver Notwithstanding activities to underlying quarter, volume momentum, recovery. the we the double-digit commercial planned Japan volatility,

Russia X.X%. markets The XXXX, X.X by prior of strong HTU XX, brands share to see income XX very our we in such to the excluding middle December addition and in Ukraine, promising compared progress in IQOS developed launched reach year low the points to markets. countries, grew plus by In growth and

IQOS commercialization, represents the size these Given the positioning and the relatively progress. premium of of excellent stage the large markets, this portfolio existing early of

also new towards prime intend example Jordan, a share of Dominican devices Egypt, launch, approaching market the compared range this emerging of As to tailored as months as the pandemic is QX despite and last this complementary notable offtake successes markets Other Manila. bring to launched is quarter total of in HTUs well of A Republic year. Morocco X.X%. X% where Cairo exit and heat-not-burn end we of Lebanon, the recently mentioned share to restrictions as of within in X including Philippines, the

success points. ILUMA, we We to become XX% more following to its market growing base to legal-age has consecutive ILUMA need cleaning the for the This smokers now which led up-trading been smoke-free at have reactions XX% outstanding remain performance and fastest both in Marlboro high existing six Score. large with consumer consumables a retention of smokers the bodes XX% Promoter more TEREA ILUMA legal-age launch, observed has Moving our category, of ILUMA Japan, user consumables further launch user August uptake and expectations. and HEETS volumes, of since new the within launch, XXXX among over an experience, better exceeding enhanced of IQOS rates IQOS premium-priced the since the overtaking Moreover, rapid, quality IQOS. than number rates, are with launch; three brand. users devices Net to no and to significant to of in still report use the sales increases combined In ONE, delighted and and the conversion for now the one smoke-free sales in consistently of IQOS reliability and well all months with reaching Heatsticks national devices price offtake provides multiple and launch share affordable the

commercialization. SENTIA ILUMA, remarkable, price new HTU and HEETS. Switzerland TEREA again mainline brand of even more prefectures called a Results use also have a sales five sales making users, months to comparable significant in almost to with in for been We with two-thirds HTU point of up are new at only select introducing after

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in Our last month. Spain newest was ILUMA launch

XX% the very over While rate, days increasing the XX% new the world. first March roll-out to to encouraging existing one maturity very level prior and device at the HTU within also clearly consumer of around users month, signs offtake. positive quarter exiting of with compared RRP of of run upgraded total TEREA with are markets sales characteristics wider early users These the three ILUMA differing across very and for results are

timing are the the While markets delayed markets, somewhat was of and anticipated. ILUMA than new initial supply for constraints device given need HTU originally the new been uptake in the market rapid availability resulting easing, supply greater for each has for

of In TEREA impact. Russian of investment our HTUs in in facility addition, cancellation the has production short-term the a our

towards the further serve of now As IQOS and ILUMA, a to now three the market market. heat-not-burn launches segment different the under DUO LIL, are mostly X IQOS consumer have With technologies expected umbrella result, HX. and we needs end

disruption within of XX% consumables an was affected of after rapid exciting these supply progress in of resumed. markets at visible share, rapid of availability. the feedback. is first more the commercialization add of on which of Shiro devices in under in different devices price premium present to In leadership Nordics IQOS We some to has especially closed system subject start pursue of we average consumer seven eight temporary a the the over with plan category we share brand Separately, premium QX and further is months the at position group XX, this nicotine re-launched year, see price launch. Czech pipeline with well, VEEV Republic, device proposition, also e-vapor, pouches results Croatia continue. with making to March encouraging almost an at timing quarter in with markets growth VEEV VEEV’s positive tiers. progressing our innovation promising the Italy a In have and time. profitable We pods, as XX% results competitive success differentiated in reaching XX%, offtake to and

our Moving priorities, to our two to sustainability published share important in I’m statement. XXXX developments happy and proxy ESG

of the updated beyond strategy smoke-free, healthcare reflect expanding wellness company’s our Directors of and better Board our to in our statement of transformation. purpose, corporate and role Firstly, it

performance most products Sustainability long-term body Second, Further potential world dedicated May be Product cigarettes, ESG our the ESG smoke-free risk smoking. details and explicitly will to smokers the health is the compared on remains scientific further There better with a in legal-age one of Index evidence bespoke accelerating impact a critical of of substantial introduction smoke-free reduction growing around alternatives. growing disclosures. links to our shared penetration of of as priorities, and Integrated of the products is switch of XX% compensation. Report real-world XX, and of end the our

While challenges regulatory of support public the to I’ll And which is Jacek. health. A policies recognize to heatnot-burn, can that impact back tobacco harm turn and have and markets now frameworks established we example recent has you. fiscal distinct excise positive pouches. tax be on expected, Italy, some it to reduction are Thank this for in nicotine continue categories e-vapor

Jacek Olczak

and have initial Thank with in results the a you and Ukraine, of delivered Emmanuel. user in start growth, Russia from an groundbreaking IQOS the innovation the we ILUMA. year challenges recovery IQOS strong exceptional Despite to excellent

geographies. at recently new and of As we categories have to smoke-free CAGNY, we covered and and existing expand a across grow pipeline further rich innovations

Our share, to allows further switching combustible us to stabilizing cannabilization, now impact accelerate IQOS category is of which smokers business the despite of alternatives. better

continue on growth innovative to products, also to We positive seek for healthcare impact long-term and the wellness a society. invest through which of development deliver net

to global and affecting first also to X.X% of X% organic margin half pro in to with XX% strong, expand basis supply a expectation to pressures XXX disruption Despite the significant currency-neutral XXXX Our inflationary EPS forma up net year, full chains growth operating by points. and diluted are we income our revenue X.X% the growth. and expect adjusted organic fundamentals

of Russia committed your Overall, very taken continue growth or reported transformation. X. we assumption further the sustainably have from you. April questions. outlook to our the confident are Thank we rewarding we to Ukraine now addition, shareholders in are we near conservative mid-term in contribution as over answer In our guidance and and no And remain time happy from


you. Thank

conduct will of from Instructions] Our conference. Stifel. question the question-and-answer We portion comes with the Chris [Operator first Growe now

open. now is line Your

Chris Growe

morning. Hi, good

Jacek Olczak

morning. Good

Emmanuel Babeau

Hi, Chris.

Chris Growe

your wanted sticks, and adjustment Russia is first, new sure, is I as obviously to billion your XX and for billion could, as year? taking just I the the and ask excluding volume expectations new year I to your for XX guidance Ukraine, out – for the reducing made the IQOS think Ukraine, about if that you’ve expectation Russia only wanted about that I just Russia think for this for be just incorporates you that Ukraine Hi. to that that estimate and and guidance

Jacek Olczak

That’s correct.

billion. which as But X looking there Russia the and X IQOS that Ukraine. year recognize been first Therefore, then, April of Ukraine volumes have Russia on first no is the billion. QX we X or to nor the pro assume sales obviously, XX year period, excluding during translates neither the further directly full Russia to XX billion, forma is is the of for which both for in just back talking if We’re into from sold geographies, entire you which add in XX already we what a Ukraine. the quarter, that billion-XX sold But billion assuming billion, the would for and

Chris Growe

Thank it. second about then shipments in little I you. wanted about a just device quarter. the understand higher quarter, to And Got you’ve bit talked the

at Japan driver think growth at will the that’ll some on revenue have like time of in revenue timing it where you sounds same differences, overall. weigh I a stronger least be that

single-digit you’re in increase a I think more like expecting revenue. low

devices the it and it of Is for that full availability maybe of a, help of the help when rest two of function Ukraine a sounds want just guess to that’s devices. the understand timing in And the to revenue. back Japan the to also to just call XQ not devices? magnitude is on like committed I availability understand I the factors. to degree world, And Thanks. that those So larger more terms is like then availability It Russia having I’ll a the can you of factor providing second-half clear? of

Jacek Olczak



the contributes right. putting the one the the quarter on pressure a the devices it that to but devices you’re of the remember global right, on hand, revenue, better yes, are to margins, shipments help So first the absolutely

the between impact the started and on in devices revenue and expect The margins. impact hand So of that’s on supply on the QX the one we to the which the of big is have consumables. the the shipments

we to that us So will while. we among resource and a Japan it our the go as other the of supply Japan, result, the capacity And and in missing inventories on take that sticks lower investment the with to chain in constraints need locations heat TEREA. stopping expect will mainly Russia, a And therefore, in I think, that quite on to aiming XX% on quarter a market we the growth Emmanuel, in share. manufacturing ensure for indicated around and expect will Japan. slide we’re side, proper IMS, – we market have that at the when should XX% And the order the we think robust on share have the resourcing we

the the to So on QX in stronger performance half which the shipments we normal impacted but course and it’s what nothing than resume second shipments. do in this be drive to half, and performance level will consumer this to hence, the in to need And the by better the the offtake will order through the of on be operations first the QX. difference the estimate QX inventories in level, we

is the geographies, sale to with in the regards mean, excluded I Now devices the there of devices, continuous this right.

stopped it’s selling, happening this the recognizing to So due whole reality, devices, stopped the not visibility that we keep least to we and what we Ukraine. in right. replacement factors, other and at in Russia is need the But thing

very order supplies. other not getting realize device we Russia and the visibility of – better to can regards orders locations. and redirect future IQOS. that better Ukraine have the to about the year. second not fulfillment And perfect moment We it’s them of better remember, you the with realize fully for we we’ve when better, with the and So year, to but can the more volume opportunity And do the been feel also cautious actually out half and of about to take last this confident regards we had visibility how

the not availability some, moment regained the the could okay but perfect, have have of we I and devices And user you that but growth it’s it’s the misled year. progression say how beginning at IQOS better saw for in So QX. share its of acquisition at market it anybody want to full-fledged don’t looks it’s perfect, accelerate not than that the almost

undisturbed we know of we and continually devices have both but that So the everything a sticks. hinges it, on and supplies uninterrupted heat

Emmanuel Babeau

maybe HX. last gross XX%. that it’s HX. the were the just the of The in complement, at I’m really lower Chris extremely understand gross that to more in and think HX gross year, HX you was margin in versus margin everybody QX, we important was remember normative and I probably high, sure QX And evolution margin

have QX of we seen facing first what all in So high very was comps.

it, we’ve top to in think I of for knowing reduction shows expect basis think good gross sales QX, been on success last which have in will that you than QX the driver XXX is reference it various continue is XX% the more of as well element margin we describing margin. What the point for year can presentation, QX. the in in And IQOS. device because the the I gross news even this is

reason in impact have for is with for freight volume on chain air mentioned increased the that in come have increased have QX air in compensation you we HX. that, compensation that course And the tension freight, cost the a with the be with reason And on fact element, last like and and the We but the temporary in that will recovery margin. have pressure, on that’s way Japan by QX, will the of margin the which the you the HX. and lower going supply pressure this the gross for mix, to an element

Chris Growe

much. Thanks great was so color. That


Morgan Kaufman We’ll take with our Stanley. from question next Pamela

line Your is open. now

Pamela Kaufman

Hi, good morning.

Jacek Olczak

Good morning.

Pamela Kaufman

Russia’s of of XXXX? smoke year by this the from products and question as reduction assume about free overall targets business, the revenue your similar you how coming tobacco a have you’re guidance outlook reduction contribution on XXXX significant given the you. we the side, how for next target XX% are I for should a year, your heated target HTU XX%? about your Thank on for thinking to your And particularly achieving strategy to IQOS adjusting for

Jacek Olczak

Well – you. thank

et We constraints the and chain continue in expansion cetera. confronted and existing devices IQOS with all obviously portfolio of with supply the and geographies the of new geographical the this we availability and

us the we to confident way I I a mean, the we absolute repetition, But business deliver look the way visibility the do mean, will about essentially XX growth a maybe of at I that’s land? this – absolute for exiting or we relative that But the target and also remain we thing. time targets longer the further I combustible look I we to don’t be geographies in my floor look may whole The not relative be referring for bottom-line way deliver I what’s deliver is on And on that There not miss. term the or target. a a to happening Ukrainian might position appreciate is target, in in in to being existing maybe to delay. It’s deliver volume, this. X they need changed recognized and the cetera. outlook parameters, a a mean, et that situation way non-combustible thinking position our numbers. at little business that for growth any need really that no what’s of not make target intentions our lowest as we this I have the Russia is maybe know the so this. it. of on or the you I target, do should same bit everyone you assume time this, am bit the about and one before. April will is what I’m target important to believe just whatever volume in additional months questions for of might I XX all we’ll have So to be and think band a with our XXXX Where a relative sorry The in a be you’re yes, realize contribution, said we other – we other the into Ukraine absolute Russia and and months have and this good let’s the about All full organic little have in thing, need but again, we with can geographies. very will for we IQOS sales that, okay, one – will of as a more the growth assumptions that top-line, that target of which

Emmanuel Babeau

full in of XXXX. not we QX, your Group, Russia on you’ve below a more XX% do excluding get below. perimeter that a pro in how Pamela, And on seen Ukraine to and are than question I’m the but we basis on that bit sure much the forma

around So we versus XX% are XX%. at

we more is IQOS deliver more So, But our to showing low-and get dynamism in we than see XX%. to clearly and we’ve the business yes, a opportunity catch middle-income the that given up country, cover this there XX%. and in can ground bit think to been we

Pamela Kaufman

from role Thanks. And from a piece the user of Russia to expect a acquisition, on year? of question? there quarter, new then despite Did taking a much question how impact And supply on be did over acquisition would similar see million new play the good any that, the IQOS ILUMA this user impact hear over course in to my you users. you consumables? a recovery of the disruption out TEREA saw X Do the you user X million –

Jacek Olczak

sorry, was, all the we your think I question cut Yes, because sentence. half

Your right of can question forward? the we the dynamics acquisition going user same was expect

Pamela Kaufman


Jacek Olczak


devices. directly mean, above X million close and this to that show mean sequentially I QX. look, I portfolio above X our of So million to a availability which full the of devices quarter, acquisition, acquisition correlated growth the

also play more game, price devices, we expensive different mid-price devices. now the lower-price we segments know, you As have devices,

the today from and sort we’re you So higher, meeting consumer that same of because repeat devices, see should other of as by measured the the long expectations. and think that offering actually as we is have parameters the NPS I consumer the rate, availability perspective number, actually what we liking if not could conversion

the total outside and a and from we see in quarter on the also actually visibility to which we the devices, in the what Russia right, be So a in we the next questions year the can we achieve to once positions or so the that somehow terms Ukraine dynamics, revise would volume. deliver now in of will bridging all there’s before then IQOS

Pamela Kaufman

you. Thank

Emmanuel Babeau

you. Thank


take next with from Azer Cowen. Vivien We will question our

open. line Your is

Vivien Azer

Hi, good morning.

Jacek Olczak

morning, Vivien. Hi, good

Vivien Azer

comments a you the I in on made. there that So was quarter, accretive just I’m one in something two or Thanks. growth something reconciling thought but negative last device because time guys that I ILUMA so to ILUMA, having of mix the up Number change? wanted Japan, follow did hard mix that misunderstanding was you had am device from launch I quarter, Japan,

Jacek Olczak

device talking the ILUMA, mid mix three versions to that that and of you now to think price now, introduced the I consumers. lower we’re have IQOS just of three the the premium, lower as a was selling we’re price, – market

is is And ONE, So device, all on attractive before. one attractive on QX, the price we in the higher which the of mean, recognized at that used than the the to this them market, lower lowest and I goes this in but that than second the version ILUMA already obviously because is device in shipments, the price shipment. we competitions, the have IQOS the price X had

into. here maybe So to Vivien look to we need

Emmanuel Babeau

the with I mix if term Emmanuel positive the within price. because growth gross of any But come may, in of device, It’s to it’s it speaking. higher consumables. versus course Vivien the Yeah, reduced much margin, in mix at a negative device a margin in a is the gross because coming

very to we the a have more dilutive impact has but the on positive, sell, device some margin the be you impact revenue, rate So clear. on gross which it is

Vivien Azer


sales the I had think pricing tier. graph was we

So both that. thank you for

results sequential incremental and basis. anything the to second to very I out share call on had get was meaningful you an color Is some from on my because both hoping there a For standpoint, were growth, strong? year-over-year question, there Germany, activation a

Jacek Olczak

so post I the second Germany, the change to increase, is, price comes one post restricted thing. And we No, from devices. mean this start again access benefiting had Germany the not again, in price the environment

take that still and to same of blade the for before one which of we device sort lot broad larger is will is is the version, to Switzerland that market, IQOS in follows obviously a similar free the a would Vivien geography. is performing ILUMA story again IQOS how again IQOS the opening went why one the Germany a continuous this running of with version of and We the make reasons example which the is volume devices. the would ILUMA performance. additional And the into we portfolio So range this I availability here have hence go on comment a can

we so use with further of of the far in I used the Switzerland, Germany. acceleration this proxy very am success because – the a pleased especially as – the of this as for in the growth part, German So German on ILUMA acceleration IQOS speaking could I

Now, nothing consumer is think we I in life. as in reactions can this the is certain But through read far Switzerland. as

Vivien Azer

much. very you Thank Understood.


We will Goldman Bonnie with our question next take from Herzog Sachs.

Your line open. is now

Bonnie Herzog

country think on everyone. volume about all shift in a And could roughly to Can percentage All was help about in maybe And had right. you Hi, that? facility you currently? guidance? from hoping exports? you. really of and understand I when? that a volume few of you is reflected terms market manufacturing to where guess, is I in details the on could Russia, and questions And this in the then are? what us I your I St. the with Thank of your I’m guess, manufactured associated I with your few exit being what that what’s being And just then share then mechanics exported? trying us Petersburg volume plan maybe guess, just the the share, any more you what that to costs

Jacek Olczak

the by the you that is you here. appreciate how situation Bonnie, Jacek Judging just of will in number details, in question Russia. complex mentioned

of We which a stop IQOS to hence terms consumables the contribute Russia as to result of other a supposed the also is had for of we really and export Russia halt Russia expanding was immediately the for a in allocation into so market. Partially suppliers rest that more of of production of by the plans temporary ILUMA one was the one. including the investment significant that and that supply of not canceled, in So are far but also Russia that ILUMA new that key one significant. markets, much that ILUMA, launch our created of to Japan. we HeatSticks decision

equipment we working is Russia. have certain that today. don’t a I here, can’t I we we use What priority that there. first on installed go are in equipment would stop into We that so Obviously, plans, going equipment not happen more will forward? – our an capacity can will resource to means And this but capacity how we also details. that So

it’s legislation of exit need the that of manner our us employees to Russia. in first the know we all the for to the you orderly Now in in significant legislations to shareholders, reconcile regulatory Russia that interest Russia ever-evolving the puts is And or adhere. risk or on very both international, in but in constraints the the context the this And of legislation obviously our only also the evolving the environment, sanctions, Russia. ability of

want if in as significant So we presence a to, it. Russia, we we all have know

market, in organically We’re any XXX% chains and the the core Izhora business are the supply years. connected distribution built don’t is business. distribution This the business. to partners and Morris XX Philip PMI last components. the obviously sales with is of and and PM XXX% Morris We Philip over have wholesale We International. contributing local But business

so. in limited visibility committed the decisions do strengths, tobacco despite the so major but with some complex shareholding act something in on orderly our we Hence, rather have ability have have in And the to have all as at and key look is to which absolutely accordingly. we are to a to the which is in company. all PMI market unwind and business, than the in of and of with we great which We endeavor, the distributor our which along manner Russia have guidance a doing to we we addition the this, polluted headwinds, have rest together

drawing mean, working answer in the of group, complicated from we that is the can of exit, I So most terms which the more which board. of at the but not say on you transactions clarity, presumably, the we’re but best have moment. gave I know that my one we’re history this the

Bonnie Herzog

can terms full exit. exit have only just market in can the imagine. Do you to color. I clear, of date, And share? target a just the of you the Yes, the be I that appreciate

Jacek Olczak

groups this of or what business broad satisfy delay and if could looked a long – as have with rather we satisfaction for But we everyone relentlessly we the Well, And mean But this beyond it, the the have would group like. appreciate shareholders. I mean responsibility But you exercise. to also employees various in complex teams we if the of not the of repeat as was all I necessary to business is was the becoming equation we to move overall, responsibility our big forward. again stakeholders differently. expectations Russia. that us. in I a that are have and resolve other very to things market presence how working to size try of that’s I any And

Bonnie Herzog

kind the pro second of I’d growth like understand driver at XX% that future. is and thought key now XX really but the to guess, brings outlook of I XX I for of forma that is as guess, assuming since guidance, previous billion drivers an above that your billion I your midpoint. think Russia HTU to honestly, important was such about And growth volume the to of question, this your my year, I new me which units for guidance

gives related the understand of top Thanks. you want shortage also chip of the semiconductor kind situation? just I on what So to the uncertainty especially to confidence,

Jacek Olczak

Yes. Thank you.

pro the So in today live have obviously perfect some year. the making But we forma said or enough up quarters We forma estimate on I with assumptions I a make some visibility of for this the this chain, this as think need supply earlier. come confidence pro or we to don’t all of guidance. remaining to

tougher at the the in had see were of IQOS group bit a geographies yet not progress, growing Now, including but historically We us, all the that continuous locations really essentially were look, geographies, in have where trajectory other you and for now see we they that plans with few growth. we the acceleration ILUMA and massive already thereafter of of the our we with that Japan, growth for having ILUMA in a ILUMA. a what know this that level growth with

currently portfolio to to We also fact propositions. which this IQOS mostly that [indiscernible] consummables despite any offering is the know our significant at the the the market we is both a be and devices continues also other the that premium sold very of attractive. device And continuously

sorry, we’re confidence it IQOS near Ukraine, IQOS and its grow to continue Will when think excluding this I Russia will looking getting to we’re moment forward that a growth. term and also the it lack but accelerate period period of time, of time Russia shorter a the the and of a we geographies the rest in okay. notice, longer compensate over challenging, Ukraine? I bit once of think in might

making We’re not any promises at this stage.

Bonnie Herzog

Okay. you. Thank

Jacek Olczak

you. Thank


next We’ll from Jain with Gaurav take our question Barclays.

is open. Your line

Gaurav Jain

Difficulty] [Technical

Nick Rolli

Gaurav, can’t repeat you hear we the please? you. question Could

Gaurav Jain

Sure. better? Is this

Nick Rolli

Yes, it’s you. thank Yes, better.

Gaurav Jain

Sorry about that.

your volume own is question and first guidance ex-Russia Ukraine. industry on your my So and volume

European So if look, it to And volumes, at seems they strong. become better. I your are have quite especially

and pressure be Europe might not have we on impact. recession, pressure oil So consumers recession inflationary in macro sort and in the of this price

less affordable X cigarette why volume inflation are wage is volumes? and X pricing that while you actually So and trends? seeing so right cigarettes and X when becoming are historically it that’s up still growth cigarettes affordable why cigarette better Europe you is be my is prices question more wage used And are now stronger is X, probably are was so becoming in or to seeing X, that

Jacek Olczak

underlying uncertainty the to coming information that the we are Well, are I market in should and the in trend suppose what’s QX our on growth have that of economy we is true, evolution. no I quarters. there the mean, the global think I behaviors. that in of term trends is be Gaurav, there this It pointing going of to demographics – some

still the the Let’s also contribution COVID. is after rebound there face it of

was I year in for a can we months more be normal a becoming are saying normal yet. the not. not markets, hope in there normal. other and positive. we’re year, But last to coming we mean, much more that’s So to going Free, that Duty I’m be not we’re

of impact market we course the what some economy. be impact Chesterfield potential very going and we’re slowdown going Marlboro offering. recovering with we we’ve Today volume a our way, on So success being going downtrading is for see cheaper the more I that of see and By successful brands. what’s been IQOS on and all of we consumer share see know highlighting the to great countries don’t to an have in or and

what starting nice volume. anticipation, in there. numbers of – the dynamism we think some the portfolio. very is some for driving that were are flag growth, course, in seeing I even that QX if It And So outlook shows with this the but for are that us there we that is a maybe QX our growth fact

Gaurav Jain

EPS the coming to And the and guidance Sure. dividend.

payout your XX%. ratio dividend will north be So now of

And back to that with every and cycle three go share had So one you we was thinking in massive be you’re XXXX impact, adverse then used how have does keep we euro how PM the JPYXX, €XXX, XXXX. we repurchases? XX about FX cycles seeing yen and years, years,

costs FX. lot in and And Now are of Swiss another cycle franc clearly have your we a dollar. of

so you So can And cost the transaction we tight. there becoming again that is is the where mismatch something get FX situation mismatch, do lesser? very ratio payout into dividend is the

Jacek Olczak

increase that XXXX. so Well, of course yes, the Gaurav, guidance ratio the would versus would on basis a of giving, been we significantly we’ve have that payout

grow I in reduce the to think over profit in capacity we’ve shown the past, that. time and

we go get of it’s down currency to time currency given much, of I driving over and any to take it’s to that facing, that agree to precise Russia I That’s there. Our situation. we event the down a but perimeter that of going the XX% not accumulation time to the go the is objective kind and more are that bit give is didn’t adverse there. really leaving the the mean, playing, is so case, group still

the Now ForEx chain. there through better we on we everything trying that course, and on invoicing in of have cost. We equalize that buy are kind limited the dollar, that in do have and in which we are pressure do currency things on element number dollar. currency change supply you that some in continue because is limitation, There is that we a of there But buy. one the One we which to elements. we investing to there’s work with two the margin our we’re the

going the not which currency is impact, the is is dollar up most of when an on So mechanical much that do. we can which is there and versus

the have on can dimension. we work margin that invoicing. continue on the So think work we work fact We and cannot we to I limited

Gaurav Jain

lot. a Thanks Sure.

Jacek Olczak

Thank you.


next Jefferies. take from Bennett We Owen our question will with

open. now is line Your

Nick Rolli

Owen, a do you have question?


Bennett Mr. appears has it And dropped.

ahead our go Jared Dinges next take from will with question We and JPMorgan.

open. is line Your

Jared Dinges

to wanted not places Europe more through just could can seeing a you given we inflation global well you Russia given ask a be cost are offset. inflation about price long in opportunity of an like I bit Maybe environment Ukraine? additional see levels the guys. margin think there of more Hi to a as pricing increases basis, post time. on reaching a especially put is Do seen and for

Jacek Olczak

We’re taking increase variance. a and price a price

initially So came thought. in better the than we of be the opening –

the look remaining half we the what the will of to have look of When year also part material. what inflation, inflation the is of at and especially mean, see will We the the second bring. we I

what seen on living inflation the the So level. income haven’t income, the at like cost level of the of and the is yet Because we right? the inflation concept

the right I pricing of this. characterize So Emmanuel, would geographies is But most mean, in talk we balance at getting we have the into to do the environment, I Indonesia. about where spot get the right it positive. find the I mean

price a the pricing had other hopefully the Indonesia, hopefully And also this be will XXXX through increase Indonesia. which end Philippines, definitely towards significant hand, to contribution. market, We important a Germany strong year we very of will volumes flowing Turkey, quite On used or contributor in in rebound pricing have in the to this the okay. the a resume

the to accounting. goes Turkey Now hyper-inflationary

own the to year pricing variance. the I it said, beginning at we widely, ahead the as price inflation at the as But the expectations pressure. looking trying already We’re of with of started our

that how through see will continue year. this let’s the So

Jared Dinges

Southeast in to the Got expectations the there volumes, to it. strong And year of for very start up are clearly on of follow just volume Asia, terms side maybe it’s the what your on a the rest year?

Jacek Olczak

you from just to the recover situation, is with start situation back of unfortunately, there seeing of is not woods is by regards to Philippines, underlying get the some part we’re believe the in And remember, volume. they increase the didn’t still as other as bit out in, better Indonesia opportunities – pass is of accelerated to taking world, in, pre-COVID a I pricing excise we’re around but said, should on taking Well, the took COVID hand, some a Indonesia, increase the growth to really is of steps increase. mean continuous I this we a there little beginning this remember we continuously not continue couple are the So the COVID fact on the we price right? that I the – pricing which side. still the take in the of the the price if

we of territory. no the net of short essentially it’s regards to margin COVID So on surprises a and with recovery improvement keep still time hinges to need continuous very situation. further it go the into bit much But

Emmanuel Babeau

evolution. And Jared, revenue grow region to which in would we very as year, nicely be the we said, nice a expect this

Jared Dinges

That’s correct. Thanks, guys.

Emmanuel Babeau

Thank you.

Nick Rolli

last Thank you. operator. That was the question,


questions on remarks. back further Nick Rolli no or the are there And will over to the closing line. I turn additional any for program

Nick Rolli

remarks. I Jacek had some closing think

Jacek Olczak

was one problems the and due I and some you for your the us the complex situations have call the attention thank Nick pretty our also somehow patients everyone comment for President, can’t so the former quarter. to past particularly and since quarter years I toward adjusted the outstanding is PMI still and the Okay, earnings Vice to would complicated to Investor everyone technical Philip in I the on International. hope Morris since as to over the company take to line. opportunity on and Rolli, contribution like XXXX this thank Mr. Relations parent XX the and

that believe pleasure I for I me best James the Nick As hiring you as and all from successor would and congratulate for also Nick in well and know critical through we you, believe congratulating very Bushnell contributor to you At company. will journey personally his PMI XX role has on wish he I me, like enjoy years. time, a receive the I to Rolli all deserved support and I in will Rolli And been the retirement. same to his Nick same our a last of the his Bushnell our because agree new Mr. him he with investors the the new would join as was to have role welcome analysts

welcome So Nick. you, and James, thank

Nick Rolli

had on difficulties we’ll of and I very much. Thank much. you forward look all with call. last to thank dealing call. And But you, you Jacek. Thank the your with my some relationships concludes long you you, on Emmanuel. you because we very technical Thank everything That know I relationship follow-up will apologize the for we resolve the Congratulations, James. that value and questions. many call Thank and

Jacek Olczak

you soon, you. guys. See Thank


This does for conclude Thank your today’s program. you participation.

may at time. any You disconnect