Full Year 2023 Nestle SA Earnings Call - Press Conference

February 22, 2024

Christoph Meier: Good morning, everyone. Thank you for joining us this morning and a warm welcome to Nestlé's 2023 Full Year Results Presentation. With me here today are Mark Schneider, our CEO, and François-Xavier Roger, our CFO. Before we get started, let me remind you of a couple housekeeping items. You are currently placed on mute. You will be invited to ask questions after the presentations. Now, please take a moment to read the disclaimer on your screen. Thank you. With that, let me hand over to Mark.

Operator: Good morning, everyone. Thank you for joining us this morning, and a warm welcome to Nestle's 2023 full-year resumption. With me here today are Mark Schneider, our CEO. François Xavier.

Good morning, everyone. Thank you for joining us this morning, and a warm welcome to an estimated 2023 full year results presentation.

With me here today are Mark Schneider, our CEO.

And Paul Flex idea Jose however.

Paul: As CFO.

Operator: Before we get started, let me remind you of a couple housekeeping items currently placed on mute. You will be invited. Now, please take a moment to read the disclaimer. Thank you. With that, let me hand over to Christoph. Thank you and a warm welcome to our press conference. We appreciate, as always, your interest in the program. Our CFO, Francois Roger, and I look forward to working with you. I'm giving you an update on where.

Paul: Before we get started let me remind you of a couple of housekeeping items. You're currently placed on mute you will be invited to ask questions. After the presentation.

Now please take a moment to read the disclaimer on your screen.

Paul: Okay.

Speaker Change: Thank you.

Speaker Change: With that let me hand, it over to Mark.

Speaker Change: Okay.

Mark Schneider: Christoph, thank you, and a warm welcome to our press conference participants this morning. We appreciate, as always, your interest in our company. Our CFO, François Roger, and I look forward to answering your questions and giving you an update on where the company stands. Let me move right to the key messages for the year. I think the high level summary is that in a year that has seen some distinct consumer softness in the food sector, Nestlé delivered resilient performance, and we were able to come in within our guided range. We were able to increase, most notably, our operating margin. We were able to keep our underlying earnings per share within the guided range of 6% to 10% in constant currency.

Mark Schneider: Crystal Thank you and a warm welcome to our press conference participants. This morning, we appreciate as always your interest in our company.

Mark Schneider: Our CFO Jorge and I look forward to answering your questions and giving you an update on where the company stands.

Mark Schneider: Let me move right to the key messages. I think the high-level summary is that in a year that has seen some distinct consumer softness in the food sector. Nestle Deliberate Resilient, that we were able to come in within our guide, were able to increase, most notably our operating margin, and were able to keep our underlying earnings within the guided range. Free cash flow is up significantly from the year before, and we were also able to increase our. It's important to point out that these improvements do not come at the cost of putting in the fundamentals that allow us to succeed in.

Mark Schneider: Let me move right to the key messages for the year.

Mark Schneider: Thank the high level summary is that in a year that has seen.

Mark Schneider: Some distinct consumer softness in the food sector Nestle deliberate resilient performance and we were able to come in within our guided range, we were able to increase most notably our operating margin we were able to keep our underlying earnings per share within the guided range of six.

Mark Schneider: Went to 10% in constant currency free cash flow is up significantly from the year before and we were also able to increase our return on invested capital.

Mark Schneider: Free cash flow is up significantly from the year before, and we were also able to increase our return on invested capital. It's important to point out that these improvements do not come at the expense of putting in the fundamentals that allow us to succeed in the long term. Most important, meaningful innovation and renovation that keeps our product lineup fresh and relevant to consumers. Stepped up investments in brand support, which is important, especially in the day and age when private manufacturers are competing with private label offerings. Then also on the sustainability front, continued progress, which I will talk about later when it comes to our agenda on good for you regarding nutrition and good for the planet regarding sustainability.

Mark Schneider: It's important to point out that these improvements do not come at the expense of putting in the fundamentals that allow us to succeed in the long term. So most important meaningful innovation and renovation that keeps our product lineup of fresh and relevant to consumers.

Mark Schneider: So most important, meaningful innovation and renovation that keeps our product lineup fresh and relevant, stepped-up investments in brand support, which is important, especially in the daytime, and then also on sustainability, which I will talk about when it comes to our agenda on good for you and good for the planet. Based on these resilient results, the board proposes a dividend per share of three Swiss francs, an increase of five. And that marks our 29th consecutive dividend, Moving to the next slide, I won't dwell too long on this, but it is important when you look at the food sector. This report has been historic.

Mark Schneider: <unk> stepped up investments in brand support which is important especially in the day and age when private manufacturers are competing with private label offerings and then also on the sustainability front continued progress, which I will talk about later when it comes to how our agenda on good for you regarding nutrition and good for them.

Mark Schneider: Janet regarding sustainability.

Mark Schneider: Based on these resilient results, the board proposes a dividend per share of CHF 3, which is an increase of CHF 0.05, and that marks our 29th consecutive dividend increase. Again, another hallmark of the Nestlé stability in what was definitely a turbulent and unsettled time over the last few years. Moving to the next slide, I won't dwell too long on this, but it is important when you look at the food sector softness to put it in historic perspective. What we've seen over the last 2 years was definitely a food price inflation spike of historic proportions. In fact, it's fair to say that it's a 1-in-50-year event. The last time we have seen 2 consecutive years of similarly high food price inflation was in the 1970s, in 1973 and 1974.

Based on be resilient results. The board proposes a dividend per share of three Swiss francs, which is an increase of five stone team and that marks our 29th consecutive dividend increase.

Mark Schneider: Again, another hallmark of the Nestle stability in what was definitely a turbulent and uncertain time over the last few years.

Mark Schneider: Moving to the next slide I won't dwell too long on this but it is important when you look at the food sector softness to put it in historic perspective, and what we've seen over the last two years was definitely a food price inflation Spike of historic proportions. In fact, it's fair to say that he said.

Mark Schneider: And what we've seen over the last two years was definitely a food price inflation spike of historic proportions. In fact, it's fair to say that it's a one-in-fifty year investment. The last time we saw two consecutive years of similarly high food price inflation was in the 1970s, in 1973 and 1974. In between, movements have been either shorter or much lower intense.

Mark Schneider: One in 50 year event.

Mark Schneider: Last time, we have seen two consecutive years.

Mark Schneider: Similarly high food price inflation was in the 19 seventies in 73 and 74 in between movements happen either short term or much lower intense it is understandable that against this backdrop, the happen or consumer reaction when it comes to volume.

Mark Schneider: In between, movements have been either shorter term or much lower, and hence, it is understandable that against this backdrop there have been a consumer reaction when it comes to volume, shifting down to lower priced brands or favoring private label offerings. Especially against that backdrop, what I would like to point out is my sincere thanks and gratitude to Team Nestlé around the world. This has been a difficult year, a challenging year in many ways. Nestlé prides itself on good, solid performance, doing the right thing in a decentralized manner from the ground up in the 187 markets we serve around the world. In quite a few of these markets, we had to deal with something that needed to be dealt with over many decades, and that is hyperinflation.

Mark Schneider: It is understandable that against this backdrop, there has been a consumer reaction when it comes to volume, shifting down to lower prices or Peerbrine Private. And especially against that backdrop, what I would like to point out is my sincere thanks and credit to Team Nestle around the world. This has been a difficult year, a challenging year in many ways. Nestle prides itself on good, solid performance, doing the right thing in a decentralized manner from the ground up in the 187 markets we serve around the world. In quite a few of these markets, we had to deal with something that needed to be dealt with over many decades, and that is hyperinflation, still ongoing lingering supply chain issues. And so coping with all of this, serving our consumers, at the same time, while we're Advancing our sustainability agenda has been a tall task, and I deeply appreciate the commitment that Team Nestle has shown.

Mark Schneider: Shifting down to lower priced brands or favoring private label offerings.

Mark Schneider: Especially against that backdrop, what I would like to point out as my sincere, thanks, and gratitude to team necessarily around the world. This has been a difficult year a challenging year in many ways Nestle prides itself on good solid performance doing the right thing in a decentralized manner from the ground up and the 180 <unk>.

Mark Schneider: Seven markets, we serve around the world and quite a few of these markets we had to deal with something that needed to be dealt with over many decades and that is hyper inflation, we still had ongoing lingering supply chain issues and so coping with all of those serving our consumers at the same time, while we are serving consumers advancing.

Mark Schneider: We still had ongoing lingering supply chain issues, and so, coping with all of this, serving our consumers. At the same time, while we're serving consumers, advancing our sustainability agenda had been a tall task, and I deeply appreciate the commitment that Team Nestlé has shown in this context. Now, going forward, in addition to the strong commitment from Team Nestlé, what does give me confidence when it comes to the continued growth and success of the company is our ability to generate and to advance growth catalysts. What you're seeing here on this slide is five of them in particular, where you see continued strong, resilient performance, including what we call real internal growth. The sum of volume and mix in such a year like 2023 that had seen inflation challenges.

Mark Schneider: Our sustainability agenda had been a tall task and I deeply appreciate the commitment that team necessarily has shown in this context.

Mark Schneider: Now, going forward, in addition to the strong commitment from Team Nestle, what does give me confidence when it comes to continued growth and success is our ability to generate, and in advance, Krolf Katter. And what you're seeing here on this slide are five of them in particular, where you see continued strong, resilient performance, including what we call real internal growth, so the sum of volume, in such a year like 23 that we have seen. And what's important, many of you know about our continued success in pet care and in coffee. But the ability to generate these growth catalysts goes far beyond that. And hence, it's important to appreciate the full extent of what we can do here. And just these five examples.

Mark Schneider: Now going forward. In addition to the strong commitment from team yesterday, what does give me confidence when it comes to the continued growth and success of the company is our ability to generate and to advance growth catalysts and what you're seeing here on this slide is five of them in.

Mark Schneider: Where you see continued strong resilient performance, including what we call real internal crops are the sum of volume and mix in such a year like 23 that had seen inflation challenges and what's important as many of you knew about our continued success in petcare coffee, but.

Mark Schneider: What's important, many of you knew about our continued success in pet care and in coffee, but the ability to generate these growth catalysts goes far beyond that. Hence it's important to appreciate the full spectrum of what we can do here. Just these five examples, and this is not an exhaustive list, on this page. They stand about a third of the revenue of our company and continue to develop that, keeping the product line up fresh, keeping brands exciting. I think this is the recipe for continued success in our industry. Looking at 2024, definitely we continue to operate in a very demanding environment, in challenging economic times and also significant global issues from some supply chain stress to geopolitical issues.

Mark Schneider: The ability to generate these chrome catalysts goes far beyond that and hence its important to appreciate the full spectrum of what we can do here and trust. These five examples and this is not an exhaustive list on this page they stand about a third of the revenue of our company and are continuing to develop.

Mark Schneider: This is Not an exhaustive list; on this page, they stand about a third of the revenue of our company. And we continue to develop that, keeping the product line-up fresh, and keeping brands exciting. I think this is the recipe for continued success now. Looking at the year 24, definitely, we will continue to operate in a very demanding environment, in challenging economic times, and also significant global issues such as some supply chain stress, and political issues. Hence, it is important that we stay fully focused on execution excellence during that year. And that is a priority number 14.

That keeping the product lineup fresh keeping Brian it's exciting I think this is the recipe for continued success in our industry.

Looking at the year 24 at definitely we continue to operate in a very demanding environment.

In.

Mark Schneider: A challenging economic times and also a significant global issues from some supply chain stress to geopolitical issues and hence it is important that we stay fully focused on execution excellence in debt here and that is a priority 14 nessler. So this range ranges.

Mark Schneider: Hence, it is important that we stay fully focused on execution excellence in that year, and that is a priority for Team Nestlé. This range ranges from supply chain management to in-store execution. It ranges from order fill rates, improving those, continuing to improve those, to anything that is related to branding and safety. All of these aspects we will continue to stress and definitely implement on with a high degree of fidelity. It's also important that we continue with our marketing and growth investments. We've already seen a tremendous recovery of those in the year 2023. We increased our PFME spend, so that's the brand support, by 70 basis points last year, and we will continue to increase it going forward in 2024.

Mark Schneider: So this ranges from supply chain management to in-store execution. It ranges from order fill rates, improving those, continuing to improve those, to anything that is related to branding and safety, and all of these aspects we will continue to implement with a high degree of confidence.

Mark Schneider: From supply chain management to in store execution. It ranges from order fill rates improving there was continuing to improve those.

Mark Schneider: To anything that is related to planting and safety and all of these aspects. We will continue to stress and I'm definitely implement on with a high degree of fidelity.

Mark Schneider: It's also important that we continue with marketing and growth investments. We've already seen a tremendous recovery of those this year. We increased our PFME spend, so that's the brand support, by 70 basis points last year, and we will continue to increase it going forward, in 24, in particular with a focus on our fast-growing billion. So 4.24, the recipe, is not only to spend more on brand support, but it's also to spend it in a more focused way on our... We will be committed to delivering what we call real internal lead growth. So real internal This is important in a day and age when technology has to take over.

Mark Schneider: It's also important that we continue with our marketing and crawled investments, we've already seen a tremendous a recovery of those in the year 'twenty three we increased our <unk> spend so that's the brand support by 70 basis points last year, and we will continue to increase that going forward in <unk>.

Mark Schneider: In particular, with a focus on our fast growing billionaire brands. For 2024, the recipe is not only to spend more on brand support, it's also to spend it in a more focused way on our proven winners. We will be committed to delivering what we call real internal led growth. Real internal growth is, as I mentioned, the sum of volume and mix. This is important in a day and age when this has to take over as the main bedrock of our growth from pricing. Over the last 2 to 3 years, pricing during this historic food inflation spike took over. Now definitely we have to come back to what is the long-term recipe for success, and that is continued focus on volume and mix. Mix, as you know, in particular stands as a good proxy for innovation.

Mark Schneider: Four in particular with a focus on off has crawling billionaire brands. So for 'twenty for the recipe is not only to spend more on brand support is also to expand it in a more focused way on our proven winners.

Mark Schneider: We will be committed to delivering what we call real internal led growth. So real internal growth is as I mentioned that some of volume and mix. This is important in a day and age. When this has to take over as the main bedrock of our growth from pricing over the last two.

Mark Schneider: That's the main bedrock of our growth from price. Over the last two to three years, pricing during this historic food inflation spike took over, but now, definitely, we have to come back to what is the long-term recipe for... and that is continued focus on volume. Mixed SQ and O, in particular, stand as a good proxy for innovation, our ability to dish up products that find relevance with consumers and interest, and to use that to trap a crow going forward.

Mark Schneider: Two to three years of pricing do you want this is Tory flute food inspiration spike took over but now are definitely we have to come back what is the long term recipe for success and that is continued focus on volume and mix mix ESCO in particular stands as a good proxy for innovation, our ability to take up products that.

Mark Schneider: Our ability to dish up products that find relevance with consumers and interest of consumers, and to use that to drive the growth of the company going forward. It's also important that we continue to restore our gross margin after that historic food inflation surge that was a hit to our gross margin, and I think we continue to make good progress on that. As you see, we've already taken a first big step in 2023 in restoring free cash flow, and we will continue to work and improve on that in 2024 and going forward. Next, I would like to spend a bit of time on a business unit that certainly has caught a lot of attention in the year 2023, and where I know that, with our investors and the public, there are quite some questions.

Find relevance with consumers and interest of consumers and to use that to try to cope with the company going forward.

Mark Schneider: It's also important that we continue to restore our gross margin after that historic food inflation search that was a hit to our gross margin and I think we continue to make good progress on that and as you've seen we've already taken our first big step in 'twenty, three and restoring free cash flow and we will continue to work on and improve.

Mark Schneider: On that in 'twenty, four and going forward.

Mark Schneider: Next I would like to spend a bit of time on a business unit that certainly has caught a lot of attention in the year 'twenty three and we're no better with our investors and the public they're quite some questions. So it is about Nestle health science and the performance of this business, we did regret that in the second half of the year.

Mark Schneider: It's also important that we continue to restore our gross margin after that historic food inflation surge that was a hit to our gross margin. We continue to make good progress on that. And as you've seen, we've already taken a first big step in 2023 in restoring free cash flow. And we will continue to work and improve on that, from 1974 and going forward.

Mark Schneider: It is about Nestlé Health Science and the performance of this business. We did regret that in H2 of the year, we had significant supply chain issues in our vitamins business in particular. The vitamins, minerals, and supplements business did suffer from a fairly significant IT integration issue that started to hit us from Q3, and that has taken more time, more effort to fix than we initially anticipated. The purpose of this slide is to assure you, first and foremost, of the valid, strong strategic underpinnings that Nestlé Health Science has now, continued commitment to it, but then also to explain to you in a bit more detail what has gone wrong and why. In terms of the operating segments that Nestlé Health Science is engaged in, Consumer Care, and Medical Nutrition, those continue to see very strong fundamentals.

Mark Schneider: We have significant supply chain issues in our vitamins business in particular.

Mark Schneider: So the vitamins minerals and supplements business did suffer from it fairly significant integration issue that started to hit us from the third quarter and that has taken more time more effort to fix than we initially anticipated the.

Mark Schneider: Next, I would like to spend a bit of time on a business unit that certainly has caught a lot of attention in the year 23 and where I know that with our investors and the public there are quite some questions. So it is about Nestle Health Science and the performance of this business. We regret that in the second half of the year, we had significant supply chain issues in our vitamins business, in particular.

Mark Schneider: The purpose of this slide is to assure you first and foremost off the valet strong strategic underpinnings that Nestle Health Science has now continued commitment to it.

But then also to explain to you in a bit more detail what has gone wrong and why so in terms of the operating segments that Nestle health science is engaged in consumer care and medical nutrition those continued to see very strong fundamentals.

Mark Schneider: Medical nutrition has been a double-digit grower last year, and consumer care, when it comes to advanced nutrition products, also have been a successful grower. The problems were isolated to the vitamins, minerals and supplements space, and in particular 2 factories where we had this IT integration issue that stopped us from supplying for several weeks and then took us quite a bit of time now to ramp up volume again. We do confirm something that we had shared with the public at prior events, and that is that mid-term, that specific portfolio is positioned to deliver high single-digit organic growth. What we have to do is put these integration issues behind us and then make good on that promise going forward.

Mark Schneider: Medical nutrition has been a double digit grower last year and consumer care. When it comes to advanced nutrition products also had been a successful crore. The problems were isolated to the vitamins minerals and supplements space and in particular, two factories, where we have this it integration issue that stopped.

Mark Schneider: So the vitamins, minerals, and supplements business did suffer from a fairly significant IT integration issue that started to hit us in the third quarter, and that has taken more time, and more effort than we initially anticipated. The purpose of this slide is to assure you, first and foremost, of the valid, strong, strategic underpinnings. Nestle Health Science has now continued commitment, but I will also explain to you in a bit more detail what has gone wrong. So, in terms of the operating segment. Nestle Health Science is engaged in consumer care and medical nutrition.

Mark Schneider: <unk> from supplying for several weeks and then took us quite a bit of time now to ramp up volume again.

Mark Schneider: We do confirm its something that we had shared with the public at prior events and that is that midterm that specific portfolio is positioned to deliver high single digit organic growth.

So what we have to do is put these integration issues behind us and then make good on that.

Mark Schneider: Promise going forward and then I do believe that we do have a strong and focused portfolio with world leading brands brands that have global appeal, and where we have a continued opportunity to roll them out across the world. Since we have seen very very strong consumer interest across the board.

Mark Schneider: I do believe that we do have a strong and focused portfolio with world-leading brands that have global appeal and where we have a continued opportunity to roll them out across the world, since we have seen very, very strong consumer interest across the board. Now, specifically, the question did come up a few times: Why did such an integration issue happen? Why is there an IT issue? Isn't Nestlé known for IT excellence? Yes, it absolutely is. Had this issue occurred in one of our main regional environments, it would have been far more mitigated. As you do know from the past, Nestlé Health Science was a globally freestanding unit. We'd established it as a globally managed business in order to prioritize growth over the years.

Mark Schneider: Those continue to see very strong fundamentals. Medical nutrition has been a double-digit grower for the last several years, And Consumer Care, when it comes to advanced nutrition products, also has been a successful grower. The problems were isolated to the vitamins, minerals, and supplements space, and in particular to factories where we have this IT integration issue with supplying for several weeks, and then it took us quite a bit of time now to ramp up Boeing. We do confirm something that we had shared with the public at prior events, and that is that, in the midterm, that specific portfolio is positioned to deliver high single-digit growth. So what we have to do is put these integration issues behind us and then make good on the bad, and Chris Cromer. That's it for the day. I'm Chris Cromer.

Mark Schneider: Now specifically.

Mark Schneider: The question did come up a few times why did such an integration issue happen why is there an I T issue is necessarily known for excellence and yes, it absolutely is and.

Mark Schneider: <unk> had this issue occurred in one of our main regional environments. It would've been far more mitigated, but as you do know from the past Nestle Health Science was it globally freestanding unit with establish it as a globally managed business in order to prioritize crop over the years, we have delivered on.

Mark Schneider: We had delivered on this growth, in my opinion, in a very convincing way, building it from an annual revenue of less than CHF 2 billion in 2016 to something that is now north of CHF 6 billion in 2023. What we had to realize is that with this very strong focus on growth, clearly some integration issues were initially underestimated. I think we did take very energetic action as soon as the problem surfaced. We did make very significant management changes and structural changes. We are preserving the globally managed business structure, but we're giving the full support from IT and group operational resources that the group can bring to the table, and we're throwing everything at fixing this problem as fast as possible, and we have seen good progress already. As it stands now, we're seeing some continued shortness in Q1.

Mark Schneider: This growth in my opinion, a very convincing way building it from an annual revenue of less than $2 billion in 2016 to something that is now north of $6 billion in 2023, but what we have to realize is that with this very strong focus on growth clearly some integration issues were initially under estimated.

I think we did take very energetic action as soon as the problem surfaced, we did make very significant management changes and structural changes we are preserving.

Mark Schneider: And then I do believe that we do have a strong and focused portfolio with world-leading brands, brands that have global appeal and where we have a continued opportunity to roll them out across the world. Now, specifically, the question did come up a few times, why did such an integration issue happen? Why is there an IT issue?

Mark Schneider: The globally managed.

Mark Schneider: Business structure, but we're giving the full support from I T and group operation of resources that the crew comparing to the table and to where from everything at fixing this problem as fast as possible and we have seen good progress already.

Mark Schneider: As it stands now we're seeing some continued shortness in the first quarter, hence the year, we'll continue to start on a slow pace, but then we do believe to turned the corner in Q2 and then we're also looking at a fairly strong second half, but we usually don't give guidance for our business units the expert.

Mark Schneider: Hence, the year will continue to start on a slow pace. Then we do believe to turn the corner in Q2, and then we're also looking at a fairly strong H2. While we usually don't give guidance for our business units, the expectation here is therefore negative organic growth in Q1, then turning the page in Q2. We expect double-digit organic growth in H2, and the whole thing for the full year should add up to mid-single digit organic sales growth performance. Again, we regret that we were not able to live up to original expectations for 2023 and 2024, but we're also confirming the long-term viability of this business and also confirming our 2025 midterm expectations that we had for this business, which we articulated as part of our Barcelona Investor Day at the end of 2022.

Mark Schneider: Isn't Nestle known for IT excellence? And, absolutely yes. And had this issue occurred in one of our main regional environments, it would have been far more manageable. But, as you know from the past, Nestle Health Science was a globally freestanding unit. We established it as a globally managed business in order to prioritize growth over the years. We delivered on this growth, in my opinion, in a very convincing way, building it from an annual revenue of less than two billion. to something that is now north of $6 billion in 2023. But what we have to realize is that with this very strong focus on growth, clearly, some integration issues were initially unforeseen. I think we took very energetic action as soon as the problem surfaced.

Mark Schneider: Station here is still four negative organic growth in the first quarter then turning the page in the second quarter, and we expect double digit organic growth in the second half and the whole thing for the full year should add up to mid single digit organic sales core performance. So again, we regret that we were not able to.

Mark Schneider: Appeared original expectations for 'twenty three 'twenty four but we also confirming the long term viability of this business and also confirming our 25 mid term expectations that we had for this business, which we articulated as part of our Barcelona Investor day at the end of 'twenty two.

Mark Schneider: For the next three slides, I would like to talk about some aspects of our strategic direction and strategic posture. The first one I would like to start with is what I consider to be a very convincing premiumization drive over the last 10 years. Premiumization, it's important for me to point out this is not luxury. Premiumization, as you can see from the footnote of this slide, is essentially defined as starting from 20% above the midpoint of pricing in a category. As you can see here, premiumization has done wonders to our organic growth and also to our margin. We have increased the share of premiumized products from 11% in 2013 to now 36%.

Mark Schneider: For the next three slides I would like to talk about some aspects of our strategic direction and strategic posture.

Mark Schneider: And the first one I would like to start with is what I consider to be a very convincing premium amortization trials over the last 10 years premium Ization. It's important for me to point out. This is not luxury premium amortization as you can see from the photos of this slide is essentially defined as.

Mark Schneider: We did make very significant management changes and structural changes. We are preserving the globally managed business, but we're giving the full support from IT and crew operation resources that the crew can bring to the table, that were thrown everything at fixing this problem possible, and we have seen good progress.

Mark Schneider: Starting from 20% above the midpoint of pricing in a category and as you can see here premium amortization has done wonders to our organic growth and also to our margin and we have increased the share of premium ice products from 11% in 'twenty.

Mark Schneider: 13 to now 36%, so with free X increase over the decade, a very convincing performance.

Mark Schneider: A 3x increase over the decade, a very convincing performance. For good order, I would also like to point out we're still very committed to the other end of the spectrum. As you know, in emerging markets, Nestlé products very often do stand for affordability. They do stand for bringing significant nutritional benefits to people that are economically challenged. That drive is not ending. This is something that's also expanding and also making good business sense for us. But clearly, premiumization as an across-the-board across-the-spectrum trend globally is something that we're very committed to. At the bottom of the slide, you're seeing a few examples of where we brought that premiumization to the table, where we made it work, where we made it happen.

Mark Schneider: For good order I would also like to point out we're still very committed to the other end of the spectrum as you know in emerging markets. That's the products very often do stand for affordability, they do stand for bringing significant nutritional benefits to.

Mark Schneider: As it stands now, we're seeing some continued shortfalls in the first quarter, hence the year will continue to start on a slow pace, but then we do believe we will turn the corner in Q2, and then we're also looking at a fairly strong, We usually don't give guidance for our business units. The expectation here is for negative organic growth in the first quarter, then turning the page in the second quarter. We expect double-digit organic growth in the second half, and the whole thing for the full year should add up to mid-single-digit organic growth. So again, we regret that we were not able to live up to the original expectations for 2023 and 2024, but we're also confirming the long-term viability of this business and also confirming our 25 midterm expectations that we had for this business, which we articulated, as part of our Barcelona investors, at the end.

Mark Schneider: People that are economically challenged that triumph is not ending this is something that is also expanding and also making good business sense for us, but clearly premium amortization asking across the board broad across the spectrum trend globally is something that we're very committed to at the bottom of the slide you're seeing a few examples.

Mark Schneider: Of where we brought that premium amortization to the table, where we made it work where we made it happen.

Mark Schneider: Next, I would like to talk about a significant demographic opportunity that the company wholeheartedly embraces, and that is healthy aging. As you know, our company got founded in the 1860s with an infant nutrition product at a time of globally high birth rates, but also globally high infant mortality. We were answering the need of that specific time. We do remain committed to nutrition across all life stages, so that has not changed, and that commitment counts going forward. We do see now a particular demographic opportunity when it comes to healthy aging solutions. Clearly, across the world, in most major markets, the elderly and older population is growing over proportionally. They do have specific nutritional needs. Some of them are itemized here with products as examples on this page, and we're fully committed to addressing those needs.

Mark Schneider: Next I would like to talk about a significant demographic opportunity that the company wholeheartedly in prices and that is healthy aging ask you know our company got founded in the 18 sixties with an infant nutrition product at a time of globally high birth rates, but also globally.

Mark Schneider: Hi, infant mortality said, we were answering a need at that specific time, we do remain committed to nutrition across all lines J stages. So that has not changed and that commitment counts going forward, but we do see now a particular demographic opportunity when it comes to healthy aging solutions.

Mark Schneider: Clearly.

Mark Schneider: Across the world in most major markets the elderly in older population is growing over proportionally. They do have specific nutritional needs. Some of them are itemized here with products as examples on this page and we're fully committed to addressing those needs you see in <unk>.

Mark Schneider: For the next three slides, I would like to talk about some aspects of our strategic direction, and the first one I would like to start with is what I consider to be a very convincing premiumization drive over the last 10 years. Premiumization, it's important for me to point out, is not luxury. Premiumization, as you can see from the photo on this slide, is essentially defined as starting from 20% above the mid.

Mark Schneider: You see in each of the boxes examples from the unit that I think leads the charge, and that is Nestlé Health Science. It's important to me that this opportunity is not limited to Nestlé Health Science only. I believe, in fact, that almost all of our categories over time will develop meaningful, relevant, healthy aging solutions. You see here some examples from our food and from our dairy sector, but again, there's gonna be more to come. I believe this will be a significant demographic tailwind, and it's also an area where through our industry-leading research and development effort, we can bring our specific nutritional expertise to the table. When you're asking what specifically are some of the content items that contribute to healthy aging, there's obviously quite a few, but there's top four that come to mind.

Mark Schneider: Each of the boxes example, it's from the unit that I think leads the charge and that is Nestle health science, but it's important to me that this opportunity on what he is not limited to Nestle Health Science only I believe in fact that almost all of our categories over time, we'll develop meaningful relevant healthy aging solution.

Mark Schneider: You see here some examples from our food and from our dairy sector, but again, there's going to be more to come I believe this will be a significant demographic tailwind and it's also an area where through our industry, leading research and development effort. We can print our specific nutritional expertise to the table.

Mark Schneider: And as you can see here, premiumization has done wonders for our organic growth and also for our margin, and we have increased the share of premiumized products from 11 percent in 2013 to now 36%. So a 3x increase over the decade, very convincing. For good order, I would also like to point out we're still very committed to the other end of the spectrum. As you know, in emerging markets, products very often stand for affordability, they stand for bringing significant nutritional benefits to people that are economically challenged. That drive is not ending.

Mark Schneider: When you're asking what specifically at some of the content items that contribute to healthy aging.

Mark Schneider: There's obviously quite a few but there is top four that come to mind. The first one is achieving and maintaining an appropriate body weight.

Mark Schneider: The first one is achieving and maintaining an appropriate body weight. Second one is avoiding or reducing the loss in lean muscle mass. The third one is avoiding or reducing the lack of micronutrients, because we see around the world that micronutrients, even areas where affordability is not an issue, tend to be scarce. The last one that also is important on this quick high-level list is avoiding sugar spiking, either by reducing the amount of sugar in our products or by making it slower release, so that some of the inflammation and stress on the cardiovascular system gets avoided. Now, on the first one, and that is target weight and weight loss.

Mark Schneider: Second one is avoiding or reducing the loss and lean muscle mass the third one is avoiding.

Mark Schneider: Avoiding or reducing.

Mark Schneider: The lack of micro nutrients, because we see around the world that micro nutrients, even in areas, where affordability is not an issue.

Mark Schneider: Tend to be scars and then the last one that also is important on this quick high level list is avoiding sugar spiking.

Mark Schneider: This is something that's also expanding and is also making good business sense for us. Clearly, premiumization, as an across the board, broad, across the spectrum trend globally, is something that we're very, At the bottom of the slide, you're seeing a few examples where we brought that premiumization to the table, where we made it work, where we made Next, I would like to talk about a significant demographic of the company wholeheartedly, and that is healthy. As you know, our company was founded in the 1860s with infant nutrition in mind, at a time of globally high birth rates but also globally high infant mortality. So we were answering the need for that. We do remain committed to nutrition across all life stages, so that has not changed. That commitment counts going forward.

Mark Schneider: By reducing the amount of sugar in our products or by making it slower release, so that some of the inflammation and stress on the cardiovascular system gets avoid it.

Mark Schneider: Now on the first one.

Mark Schneider: And that is target weight and weight loss.

Mark Schneider: Obviously, we did have a very extensive debate in the year 2023 regarding the GLP-1 products that were clearly an important new treatment option and caught a lot of public attention when it comes to reducing weight and achieving your desired target weight. We embrace that debate very wholeheartedly. I believe this is a new option that's giving consumers new opportunities to initiate meaningful weight loss. We do understand that while you're on a GLP-1 treatment, your nutritional needs do not go away, but they shift in nature. You see here three specific examples. Again, the muscle mass preservation I mentioned earlier, avoiding micronutrient deficiencies, and also contributing to the gastrointestinal health while you're on that treatment. You see specific examples. All of those come from the Nestlé Health Science portfolio.

Mark Schneider: Obviously, we did have a very extensive debate in the year 23 regarding the G. L. P. One products that were clearly an important new treatment option and caught a lot of public attention when it comes to reducing weight and achieving your desired target weight, we embraced that debate very hole.

Mark Schneider: Hardly I believe this is a new option, that's giving consumers a new opportunities to initiate meaningful weight loss we.

Mark Schneider: We do understand that while you're on a G. L. P. One treatment unit traditional needs do not go away, but they shift in nature you see here three specific examples again, the muscle mass preservation I mentioned earlier, avoiding micronutrient deficiencies and also contributing to the gastrointestinal health, while you're on that.

Mark Schneider: Treatment you see specific examples all of those come from the Nestle Health science parameter and even at the moment is a snapshot we're seeing a business volume of about 1.5 billion Swiss francs growing very nicely that concern very well ask what we call companion products, while youre on this treatment or.

Mark Schneider: Even at the moment, as a snapshot, we're seeing a business volume of about CHF 1.5 billion growing very nicely that can serve very well as what we call companion products while you're on this treatment or after the treatment. Now, the important thing as part of this public debate, that's quite noteworthy, is that GLP-1s made a contribution that goes way beyond their inner core medical benefits alone. As a result of this debate, to put it in a high-level punchline, losing weight and being on a diet has become cool again. Obviously, there's different ways of losing weight and being on a diet. What people see now is, there's new tools in the toolbox.

Mark Schneider: But we do see now a particular demographic opportunity when it comes to a healthy aging solution, clearly, across the world in most major markets. The elderly and older population is growing more proportionally. They do have specific nutritional needs.

Mark Schneider: After the treatment.

Mark Schneider: Now the important thing as part of this public debate.

Mark Schneider: That's a quite noteworthy is that G. O P. Once made a contribution that goes way beyond their inner core medical benefits alone.

Mark Schneider: Some of them are itemized here with product, and samples on this. And we're fully committed to addressing them. You see in each of the boxes examples from the unit that I think leads the charge, and that is Nestle Health. But it's important to me that this opportunity is not limited to Nestle Health Plans only. I believe, in fact, that almost all of our companies will, over time, develop meaningful, relevant, healthy aging solutions. You see here some examples from our food and from our dairy sector. But again, there's going to be more to come.

Mark Schneider: As a result of this debate to put it in a high level punchline.

Mark Schneider: Using weight and being on a diet has become cool again, and obviously, there's different ways of losing weight and and being on a diet and.

Mark Schneider: What people see now is there's new tools in the toolbox there is new ways to really get meaningful results and Theres a lot more of a public debate around this it's important for us to point out that beyond the inner core of G. L. P. One products. We do have as you can see from the bottom part of the slide.

Mark Schneider: There is new ways to really get meaningful results, and there's a lot more of a public debate around this. It's important for us to point out that beyond the inner core of GLP-1 products, we do have, as you can see from the bottom, part of the slide, a number of products that can help consumers manage their weight and also their blood glucose levels. As you know, these two are very closely related. Those of course, just like the GLP-1 companion products, are gonna be continued attention from our research and development area. In addition to the present day parameter, you can also expect a continued stream of new products that's going to address that need.

Mark Schneider: A number of products that can help consumers manage their weight and also their blood glucose levels. As you know these two are very closely related and those of course, just like the G. Everyone companion products are going to see.

Mark Schneider: I believe this will be a significant demographic tailwind. And it's also an area where, through our industry-leading research and development effort, we can bring our specific... When you're asking, what specifically are some of the content items that pay tribute to healthy aging, there's obviously quite a few, but there are the top four that come.

Mark Schneider: Continued attention from our research and development area and so in addition to the present day parameter. You can also expect a continued stream of new products, that's going to address that need.

Mark Schneider: All in all, the way we look at it is that the increasing interest in GLP-1 products is not seen as a straight reduction in demand, but rather a shift in demand. These shifts in demand and shifts in consumer preference have happened all the time in our industry. It's our job, it's our challenge to basically adapt to that, and we're fully committed to doing this to fully meet consumers' needs who would like to achieve weight loss and manage their weight, going forward. Next, I would like to shift gears and for the next two slides, talk about our Creating Shared Value agenda. As you know, our Creating Shared Value report was also made available online today. I would like to talk about the two key planks that we're pursuing.

Mark Schneider: So all in all the way we look at it is that the increasing interest in G. O P. One product is not seen as a straight reduction in demand, but rather a shift in demand. These shifts in demand and shifts in consumer preference have happened all the time in our industry. It's our job it's our challenge to.

Mark Schneider: The first one is achieving and maintaining an appropriate body weight. The second one is avoiding or reducing the loss of lean muscle. The third one is...

Mark Schneider: <unk> basically adapt to that and we're fully committed to doing this to fully meet consumers' needs, who would like to achieve weight loss and manage their weight going forward.

Mark Schneider: Avoiding or reducing the lack of micronutrients. We see around the world that micronutrients, even in areas where affordability is not an issue, And then the last, that also is important at this quick, high level, is avoiding sugar spiking, either by reducing the amount of sugar in our products or by making it a slower release, so that some of the inflammation... Now, on the first, that is target weight and weight loss. Obviously, we did have a very extensive debate in the year 23 regarding the GLP-1 product, which was clearly an important new treatment option and caught a lot of public attention when it comes to reducing weight and achieving your desired target. We embrace that debate very wholeheartedly.

Speaker Change: Next I would like to shift gears and for the next two slides talk about our creating shared value agenda. As you know our creating shared value. A report was also made available online today and I would like to talk about the two key planks that we are pursuing of a nutritional side.

Mark Schneider: On the nutritional side, the Good For You agenda, and on the sustainability side, the Good For the Planet agenda, and give you some specific examples. Last year, for context, we were the first food and beverage company that rated its entire global portfolio on the Australian Health Star Rating system. I think in the spirit of transparency, it was important for us to lay down that baseline for the public to see. I'm glad to report that now in the first year of this, we not only continue the practice, but we're also seeing good progress on the first side. That is the growth side of healthier products, more nutritious products with a Health Star Rating of 3.5 and higher. That side has been increasing from 57% of our global portfolio to 59%. Good progress in year one.

Mark Schneider: Good for you agenda.

Mark Schneider: And on the sustainability side, but good for the planet agenda and give you some specific examples.

Mark Schneider: Last year for context, we were the first food and beverage company that rated its entire global portfolio on the Australian Health Star rating system.

Mark Schneider: In the spirit of transparency it was important for us to lay down that baseline for the public to see I'm glad to report that now in the first year of this will not only continue the practice, but we're also seeing good progress on the first side that is the growth side of healthier products more nutritious products what the house.

Mark Schneider: Star rating of three and a half and higher and that site has been increasing from 57% of our global portfolio to 59%. So good progress in year, one continued commitments year to full transparency and sharing that grow journey with you.

Mark Schneider: Continued commitment here to full transparency and sharing that growth journey with you. We have also issued a growth target for these products, the more nutritious ones, with a Health Star Rating of 3.5 and higher. Within this decade, we intend to build an additional book of business of CHF 25 to 30 billion to grow this, which is over and above the average group expected growth. On the guidance side, when it comes to the more enjoyable and enjoyment-related products, it's also important for us to be fully committed to industry-leading marketing practices and also anything that can help people make the right choices. You see two examples here.

Mark Schneider: I believe this is a new option that's giving consumers new opportunities to initiate meaningful weight loss. We do want to tell you that while you're on GLP-1, your nutritional needs do not go away, but they shift. Here are three specific examples.

Mark Schneider: We have also issued a growth target for these products the more nutritious ones, where the health star rating of three and a half and higher so within this decade, we intend to build an additional book of business of 25 to 30 billion Swiss francs took royalties, which is over and above the average CRU.

Mark Schneider: Expected growth.

Mark Schneider: Again, the muscle mass preservation I mentioned earlier, avoiding micronutrient deficiencies, and also contributing to gastrointestinal health while you're on. We see specific examples; all of those come from the Nestle Health Science parameter. And even at the moment, as a snapshot, we're seeing a business volume of about 1.5 billion Swiss francs, growing very nicely that can serve very well as what we call companion products while you're on this treatment or. Now, the important thing as part of this public debate that's quite notable is that GLP-1s make a contribution that goes way beyond their inner core medical benefits. And as a result of this debate, to put it in a high-level punch, losing weight and being on a diet have become cooler.

Mark Schneider: On the guidance side when it comes to the more enjoyable and enjoyment related products.

Mark Schneider: It's also important for us to be fully committed to industry, leading marketing practices and also anything that can help people make the right choices you see two example here two examples here one is applying to counter recaps for children and contraction on ice cream and the other one is the full transparency, whether it's front of pack.

Mark Schneider: One is applying the calorie caps for children in confectionery and ice cream, and the other one is, the full transparency, whether it's front-of-pack guidance or digital tools that can help people make informed choices. On the Good For the Planet side, I won't get into all the aspects, but I wanted to highlight one particular data point on our greenhouse gas reduction journey. Here again, this is something we published today with our Creating Shared Value report. A reduction of 13.5%, net reduction of 13.5% in greenhouse gas emissions from our 2018 baseline. As you know, as part of the science-based target commitment, you're reporting progress against that baseline. We had committed to -20% by 2025. With this -13.5%, we are on track to achieve that first important milestone.

Mark Schneider: <unk> guidance or digital tools that can help people make informed choices.

Mark Schneider: On the good for the planet site I won't get into all the aspects, but I wanted to highlight one particular data point on our greenhouse gas reduction journey. So here again. This is something we published today with our creating shared value will report a reduction of 13.5% net.

Mark Schneider: And a 13, 5% increase in house gas emissions from our 2018 baseline as you know as part of the science based target commitment you are reporting progress against that baseline we had committed to minus 20% by 2025 with this minus 13 and a half we are on track.

Mark Schneider: To achieve that first important milestone and very proud to report that.

Mark Schneider: I'm very proud to report that for a period where, of course, our business volumes grew. What that's telling you, the net reduction on the one hand and the growing business volumes on the other hand, we have effectively decoupled the growth of our business from the growth in greenhouse gas emissions. We've also included other greenhouse gases now. Rather than just providing the summary number, we are also, in particular, reporting on methane. There you're seeing an increase that's even stronger than for the total greenhouse gases, 15.3%, as part of our very diligent long-term work in our dairy supply chain, which of course is one of the key areas of methane emission. Very strong progress and building on what I shared with you in previous press conferences.

Mark Schneider: And obviously, there's different ways of losing weight and being on a diet, and what people see now is there are new tools in the toolbox. There are new ways to really get meaningful results. And there's a lot more public debate. It's important for us to point out that beyond the inner core of GLP-1 products, we do have, as you can see from the bottom part of a number of them, that can help consumers manage their weight and also their blood glucose levels. As you know, these two are very close.

Mark Schneider: For a period where of course, our business volumes crew. So what that's telling you, but net reduction on the one hand and the growing business volumes on the other hand, we are effectively and we have effectively decoupled.

The crop of our business from the growth in greenhouse gas emissions. We've also included other clean house gases now so rather than just.

Providing the summary number we're also in particular are reporting on methane and there you're seeing an increase that's even stronger than for the total greenhouse gasses, 53% as part of a very diligent long term work in our dairy supply chain, which of course is one of the key areas of methane.

Mark Schneider: Emission so very strong progress and building on what I shared with you in previous press conferences to me in a day and age of lots of long term decades long commitments that you see around the world.

Mark Schneider: Those, of course, just like the GFB-1 companion products, are going to see continued attention from our research and development. So, in addition to the present-day parameters... You can also expect a continued stream of new products. Let's go on to...

Mark Schneider: To me, in a day and age of lots of long-term, decades-long commitments that you see around the world, there are two litmus test questions that really, in my opinion, make the difference between the doers and the talkers. The first one is, are you year for year publishing your greenhouse gas emissions? Yes, we do. The second one is peak carbon behind you? Here also, I'm proud to say yes, we are. We put that behind us sometime around 2019, 2020. As you see from the data now, we have effectively decoupled the growth of the business from the growth in greenhouse gas emissions. Let me turn to the guidance for the year 2024, but then also remind you of our midterm targets for 2025, which we fully confirmed today.

Mark Schneider: There are two litmus test questions that really my opinion make the difference between the doors and to talk us. The first one is our U year four year publishing your greenhouse gas emissions, yes, we do and the second one is is peak carbon behind you and here also I'm proud to say, yes, we are.

Mark Schneider: So, all in all, the way we look at it is that the increasing interest in GLP-1 products is not seen as a straight reduction in demand but rather a shift in demand. These shifts in demand and shifts in consumer preference have happened all the time in our industry. It's our job, it's our challenge, to basically adapt, and we're fully committed to doing this to fully meet the needs of consumers who would like to achieve weight loss and manage. Next, I would like to shift gears and talk about our Creating Shared Value Agenda for the next two slides. As you know, our Creating Shared Value Report was also made available online today, and I would like to talk about the two key planks that we are pursuing. On the nutritional side, the Good For You Agenda.

Mark Schneider: We put that behind us sometime around 2019, 2020, and as you see from the data now we are effectively decoupled the cobalt the business from the growth in greenhouse gas emissions.

Mark Schneider: Let me turn to the guidance for the year 2024, but then also remind you of our midterm targets for 2025, which we fully confirm today.

Mark Schneider: Organic sales growth is expected for the year to be around 4%. It's important to note that this is our organic sales growth expectation in this post-food price inflation environment where we will see some remnants of inflation, but nowhere near the spike that had occurred in the years 2022 and 2023. That growth will rest a lot more on volume and mix going forward. The quality of that growth will be a lot better than what we've seen in past years. We do foresee a moderate increase in our underlying trading operating profit margin. That's also a hallmark from our financial models of the past and something that we stay beholden to. All of this should continue to add up to an underlying earnings per share growth in constant currency within our midterm target range of 6% to 10%.

Mark Schneider: So organic sales growth is expected for the year to be around 4%.

Mark Schneider: It's important to note that this is.

Mark Schneider: Our organic sales crop expectation in this post food price inflation environment, where we will see some remnants of inflation, but nowhere near the spikes that have occurred in the years 'twenty two and 23, so backrow for arrest a lot more on volume and mix going forward. So the quality of that growth will.

Mark Schneider: A lot better than what we've seen in past years.

Mark Schneider: We do foresee a moderate increase in our underlying trading operating profit margin. That's also a hallmark from our financial models of the past and something that we stay beholding to and all of this should continue to add up to an underlying earnings per share growth in constant currency will then our midterm target.

Mark Schneider: And on the sustainability side, the good for the planet agenda and give you some... Last year, for context, we were the first food and beverage company to rate its entire global portfolio on the Australian Health Star Ratings. I think, in the spirit of transparency, it was important for us to lay down that baseline for the public. I'm glad to report that now, in the first year...

Mark Schneider: Even though it's still a globally turbulent environment, we do believe that these essential key financial targets will be met in the year 2024. It's important for us to point out, as you know, we do have a long-term commitment to achieve mid-single digit growth. We told you in earlier years that we see our portfolio fully equipped and adjusted to deliver mid-single digit growth, and hence, it's important for us to confirm to you these 2025 targets and the mid-single digit organic sales growth that they imply. With that, I would like to thank you for your attention and let me turn over to François-Xavier Roger, our CFO, for the financial update. Thanks.

Mark Schneider: <unk> of 6% to 10%, so even though it's still globally travel and environment. We do believe that these essential key financial targets will be met in the 'twenty four and then it's important for us to point out as you know we do have a long term commitment to achieve mid single digit growth which have.

Mark Schneider: But we're also seeing good progress on the first side, that is, the growth side of healthier products, more nutritious products with a health star rating of three and a half. That site has been growing from 57% of our global portfolio to 59%. So good progress in year one, continued commitment here to full transparency, and sharing that growth journey with you. We have also issued a growth target for these products, the more nutrition and health star ratings of three and a half and higher. So within this decade, we intend to build an additional book of $25 to $30 billion to grow this, which is over and above the average crop. On the guidance side, when it comes to the more enjoyable and enjoyment-related products, it's also important for us to be fully committed to industry-leading marketing practices. And also, anything that can help people make the right choices. You see two examples here. One is applying calorie caps for children, and the other one is full transparency, whether it's front of pack guidance or digital tools that can help.

Mark Schneider: And earlier years that we see our portfolio fully.

Mark Schneider: Equipped and adjusted to deliver mid single digit growth and hence it's important for us to confirm to you. These 2025 targets and the mid single digit organic sales growth that they imply.

Mark Schneider: With that I would like to thank you for your attention and let me turn it over to fund several re our CFO for the financial update thanks.

François-Xavier Roger: Thank you, Mark, and good morning to all. Let me start with some of the key highlights for 2023. We delivered what we consider a resilient financial performance in a context of soft consumer demand. As you can see from the chart, organic growth was strong at 7.2%. Our underlying trading operating profit margin was up 40 basis points in constant currency versus the previous year. Underlying earnings per share growth was robust, increasing by 8.4% in constant currency. Free cash flow increased by CHF 3.8 billion to 10.4 billion Swiss francs. Organic growth was driven by pricing of 7.5%, reflecting the impact of cost inflation over the last two years.

CFO: Thank you Mark and good morning to all let me start with some of the key highlights for 2023, we delivered what we consider a resilient financial performance in the context of soft consumer demand.

CFO: As you can see from the chalk organic growth was strong at seven 2%.

CFO: Our underlying trading operating profit margin was up 40 basis points in constant currency versus the previous year.

CFO: Underlying earnings per share growth was robust increasing by eight 4% in constant currency.

CFO: On free cash flow increased by $3 8 billion Swiss francs to $10 4 billion Swiss francs.

CFO: Organic growth was driven by pricing of seven 5%, reflecting the impact of cost inflation over the last two years.

François-Xavier Roger: RIG was -0.3%, impacted by soft consumer demand, capacity constraints, and in the second half, a temporary supply disruption for vitamins, minerals, and supplements. Net divestitures reduced sales by 0.9%. Foreign exchange had an exceptionally negative impact of 7.8% on net sales, following the significant and broad-based appreciation of the Swiss francs against our basket of currencies. On average, over the last 10 years, foreign exchange has had a negative impact of about 3.5% per annum on our reported sales. In 2023 last year, this impact was more than twice as large. Total reported sales decreased by 1.5% to CHF 93 billion. This slide illustrates the development of our sales by geography and includes both our zones as well as our globally managed businesses. Our business is geographically diverse.

CFO: Greig was minus 0.3% impacted by soft consumer demand capacity constraints in the second half a temporary supply disruption for vitamins minerals and supplements net.

CFO: Net divestitures reduced sales by 0.9 persons.

CFO: Foreign exchange had an exceptional negative impact of seven 8% of net sales following the significant and broad based appreciation of the Swiss francs against our basket of currencies.

CFO: On average over the last 10 years Foreign exchange has had a negative impact of about three 5% per annum on our reported sales.

CFO: In 2023 last year this impact was more than twice as large.

Mark Schneider: On the good for the planet side, I won't get into all the aspects, but I wanted to highlight one particular data point on our greenhouse gas reduction journey. So here again, this is something we published today in our Creating Shared Value report, a reduction of 13 and a half, a net reduction of 13 and a half, in greenhouse gas emissions from our 2018 baseline. As you know, as part of the Science-Based Target Committee... You're reporting progress against that baseline. We have committed to minus 20 percent by 2025.

CFO: Total reported sales decreased by one 5% to 93 billion Swiss francs.

CFO: This slide illustrate the development of ourselves by geography and includes both our zones as well as a globally managed businesses.

CFO: Our business is geographically Diversed, we operate in 188 countries and we maintain our global footprint with North America being our largest region in terms of sales.

François-Xavier Roger: We operate in 188 countries, and we maintain a global footprint, with North America being our largest region in terms of sales. As the chart shows, organic growth was positive in all geographies. Beyond pricing, the key drivers of growth were continued momentum for e-commerce and out-of-home channels across all regions. Growth was broad-based across geographies, and growth in Latin America was particularly strong. Just as a reminder, China delivered mid-single-digit growth in a geography that did not experience the same level of inflation as elsewhere. Let's now look at product categories. As the chart shows, organic growth was positive across all categories. Our largest category is powdered and liquid beverages, which accounts for more than a quarter of our total sales. Coffee, the largest component of this category, posted high single-digit growth, supported by continued momentum for out-of-home channels.

CFO: As the chart shows organic growth was positive in all geographies.

CFO: Beyond pricing the key drivers of growth were continued momentum for e-commerce and outperformed channels across all regions.

CFO: Growth was broad based across geographies and growth in Latin America was particularly strong.

CFO: Just as a reminder, China delivered mid single digit growth in new geographies that did not experience the same level of inflation as well.

Mark Schneider: With this minus 13 and a half, we are on track to achieve that first important milestone. I'm very proud to report that for a period where, of course, our business volume... So what that's telling you, the net reduction on the one hand... The crope about, from the Grove.

CFO: Let's now look at product categories as.

CFO: As the chart shows organic growth was positive across all categories. Our largest category is spelled out the liquid beverages, which accounts for more than a quarter of our total sales.

CFO: Coffee the largest component of this category posted high single digit growth supported by continued momentum for out of home channels.

Mark Schneider: We've also included other greenhouse gases now, so rather than just providing the summary number, we are also, in particular, reporting on methane. And there you're seeing an increase that's even stronger than for the total greenhouse gas emissions. 50.3. That's part of our very diligent, long-term work in our dairy supply chain, which is, of course, one of the key areas. So, very strong progress, and building on what I shared with you in previous press conferences, to me, in a day and age of lots of long-term, decades-long commitment that you see around the world, there are two litmus test questions that really make the difference between the doers and the talkers. The first one is, are you year for year?

François-Xavier Roger: Petcare was the largest growth contributor, with sales growing at a strong double-digit rate for the fourth consecutive year. Growth was supported by continued e-commerce momentum and innovation, particularly for functional products. Nutrition and Health Science posted 5.4% growth. Nestlé Health Science reported low single-digit growth as continued momentum for medical nutrition was partly offset by supply constraints for vitamins, minerals, and supplements in the second half of the year. Infant Nutrition reported 8.5% organic growth, with broad-based contributions across geographies, segments, and key brands. Sales of our premium human milk oligosaccharide products grew at a strong double-digit rate, reaching CHF 1.4 billion. Prepared Dishes and Cooking Aids saw 4.9% growth, driven by Maggi, which reported double-digit growth. Milk Products and Ice Cream recorded 6.1% growth.

CFO: Pet care was the largest growth contributor we sell are growing at a strong double digit rate for the fourth consecutive year.

CFO: Growth was supported by continued e-commerce momentum on innovation, particularly for functional products.

Nutrition and health Science posted five focus on growth Nestle Health Science reported low single digit growth is continued momentum for our medical nutrition was partly offset by your supply constraints for vitamins minerals and supplements in the second half of the year.

CFO: In South nutrition reported eight 5% organic growth with broad based contributions across geographies segments on key brands.

CFO: Sales of our premium human milk oligosaccharide products grew at a strong double digit rate, reaching $1 4 billion Swiss francs.

Mark Schneider: Greenhouse Gas Emissions, yes we do. And the second one is, is peak carbon behind you? And here also, I'm proud to say, yes we are. We put that behind us sometime around 2019, you see from the data. We have effectively decoupled the probe. Crowe, and Kareem Abdul-Jabbar.

CFO: Prepared dishes and cooking AIDS and so four 9% growth driven by Maggie which reported double digit growth.

CFO: Milk products on ice cream recorded 6.1% growth the key contributors to growth were 45, milks coffee creamers and home baking products sales of ice cream grew at a mid single digit rates.

François-Xavier Roger: The key contributor to growth were fortified milks, coffee creamers, and home baking products. Sales of ice cream grew at a mid-single digit rate. Growth in confectionery was 8.5%, reflecting continued strong broad-based demand for KitKat, which continues to gain share across all geographies, as well as positive developments for key local brands. Finally, sales in water grew by 4.9% despite temporary capacity constraints for Perrier on a high base of comparison in 2022. S.Pellegrino and Acqua Panna saw double-digit growth. After several years of progress on RIG until 2020, we went through a period of heavy turbulence, beginning with the pandemic and followed by a period of unprecedented inflation. These factors created significant volatility and clearly disrupted the components of our organic sales growth.

CFO: Growth in confectionery was eight 5%, reflecting continued strong broad based demand for kitkat, which continues to gain share across all geographies as well as positive developments for key local brands.

CFO: Finally sales in water grew by four 9% despite temporary capacity constraints for failure on the high base of comparison in 2022.

Mark Schneider: Let me turn to the guidance for the year 2024, but then also remind you of our midterm targets for 2025, which we fully confirmed today. So organic sales growth is expected to be around 4%. It's important to note that this is our organic sales curve expectation in this post-food price inflation environment, where we will see some remnants of inflation but nowhere near the spike that occurred in the years 22 and 23. So that curve will rest a lot more on volume and mix going forward.

CFO: Some particularly no on Aqua panel, so double digit growth.

CFO: After several years of progress on rig until 2020, we went through a period of heavy turbulence beginning with the pandemic and followed by a period of unprecedented inflation.

CFO: These factors created significant volatility and clearly disrupted the components of organic sales growth.

François-Xavier Roger: During 2023, we have seen clear signs of normalization with a lower contribution from pricing and a higher contribution from RIG. We expect this trend to continue in the coming quarters. We are confident in our ability to return to positive RIG and expect RIG to trend back towards pre-COVID levels over the course of 2024. The phasing of RIG is not expected to be linear and should be more weighted to H2 of 2024. In Q1 of 2024, RIG could be below Q1 of 2023, given muted consumer demand and the residual impact of supply issues in our US VMS business. Just as a reminder, Q1 has one less trading day. Next is underlying trading operating profit, which it decreased by 0.3% to CHF 16.1 billion.

CFO: During 2023, we are seeing clear signs of normalization with a lower contribution from pricing and a higher contribution from read.

CFO: We expect these trying to continue in the coming quarters.

CFO: We are confident in our ability to return to positive rig unexpected rig to trend back towards pre COVID-19 levels over the course of 2024.

Mark Schneider: So the quality of that curve will be a lot better than what we've seen in the past. We do foresee a moderate increase in our underlying trading operating profit margin. That's also a hallmark of our financial models of the past and something that we stay beholden to.

CFO: The phasing of rig is not expected to be linear and should be more weighted to the second half of 2024.

CFO: In the first quarter of 2024 rigs could be below the fourth quarter of 2023, given muted consumer demand and the residual impact of supply issues in our <unk>.

CFO: U S Vms business.

CFO: As a reminder, the first quarter as one less trading day.

Next is underlying trading operating profit, which decreased by 0.3% to $16 1 billion Swiss francs.

François Roger: And all of this should continue to add up to an underlying earnings per share growth and constant currency within our midterm target of six to 10%. So even though it's still an commitment to achieve mid-single-digit growth, we told you in earlier years that we see our portfolio fully equipped and adjusted to deliver mid-single-digit growth, and hence it's important for us to confirm to you these 2025 results, single-digit organics. With that, I would like to thank you for your attention and turn over the financial report to François Roger, our CFO. Thank you, Mark, and good morning to all.

François-Xavier Roger: As a percentage of sales, it increased by 40 basis points in constant currency. The increase was driven by higher gross margin and lower distribution costs, which more than offset increased investments in marketing and one-offs in 2022. We are on track to deliver our 2025 targets of 17.5% to 18.5%. As expected, free cash flow increased from CHF 6.6 billion to CHF 10.4 billion as a consequence of a significant reduction in inventory levels. As a reminder, the decision to increase inventories in 2022 was taken in the context of supply constraints and the energy crisis in Europe. At the same time, we have continued to invest in capital expenditure above historical levels to support the expansion of capacity, mainly in pet care and coffee.

CFO: As a percentage of sales it increased by 40 basis points in constant currency.

CFO: The increase was driven by higher gross margin and lower distribution cost, which more than offset increased investments in marketing and one offs in 2022.

CFO: We are on track to deliver our 2025 targets of 17 on enough to 18 on enough persons.

CFO: As expected free cash flow increased from $6 6 billion Swiss francs to $10 4 billion Swiss francs as a consequence of a significant reduction in inventory levels.

CFO: As a reminder, the decision to increase inventories in 2022 was taken in the context of supply constraints and the energy crisis in Europe.

CFO: At the same time, we have continued to invest in capital expenditure above historical levels to support the expansion of capacity mainly in petcare on coffee.

François Roger: Let me start with some of the key highlights for 2023. We delivered what we consider a resilient financial performance in a context of soft consumer demand. You can see from the chart that organic growth was strong at 7.2%. Our underlying trading operating profit margin was up 40 basis points in constant currency versus the previous year, and underlying earnings per share growth was robust, increasing by 8.4% in constant free cash flow increased by 3.8 billion to $10.4 billion. Organic growth was driven by pricing of 7.5%, reflecting the impact of cost inflation over the last... RIG was minus 0.3%, impacted by soft consumer demand, capacity constraints, and in the second half, a temporary supply disruption for vitamins, minerals, and supplements, net divestiture, reduced sales by 0.2%.

François-Xavier Roger: Working capital and CapEx are normalizing, and we are seeing a corresponding increase in free cash flow trending back towards 12% of sales by 2025, in line with our midterm financial targets. Finally, at this year's annual general meeting in April, the board of directors will propose a dividend of CHF 3 per share, an increase of CHF 0.05. If approved, this will be the company's 29th consecutive annual dividend increase, in line with our practice of increasing our dividend in Swiss francs year on year. The company has maintained or increased its dividend in Swiss francs over the last 64 years. The dividend in Swiss francs has more than tripled over the last 18 years, representing a compounded annual growth rate of close to 7%.

CFO: Working capital and Capex are normalizing and we are seeing a corresponding increase in free cash flow trending back towards 12% of sales by 2025 in line with our midterm financial targets.

CFO: Finally at this year's annual General meeting in April the board of Directors will propose a dividend of three Swiss Frank will share an increase of five salt team.

If approved this will be the company's 29th consecutive annual dividend increase in line with our practice of increasing our dividend in Swiss francs year on year.

CFO: The company has maintained or increased its dividend in Swiss francs of other less 64 years.

CFO: The dividend in Swiss francs as more than tripled over the last 18 years, representing a compounded annual growth rate of close to 7%.

François-Xavier Roger: This year's increase takes the dividend above the Swiss francs level for the first time, reflecting our commitment to return cash to shareholders, many of whom rely on the steady and reliable income earned through their investments in Nestlé. This concludes my presentation. I hand over to Christophe, who will moderate our Q&A session.

This years increase the dividend above the Swiss response level. Those are first time, reflecting our commitment to return cash to shareholders, many of whom rely on a steady and reliable income earns foods our investments initially.

CFO: This concludes my presentation, and now I hand over to Christophe who will moderate a Q&A session.

Christoph Meier: Thank you, François. Let's now move into the Q&A session. Mark and François are joining me on stage. If you wish to ask a question, please raise your hand. You will find the yellow hand icon in the bottom toolbar of your application. As soon as I call on you, please, unmute yourself. You will be able to unmute yourself, and once your question has been answered, you will be placed on mute again. Maybe, please, I may ask you to ask only two questions at a time so that everybody has an opportunity to speak. The questions are coming in. I see the first one is from Richa Naidu, Reuters. Richa, please go ahead.

Christophe: Thank you Francois.

Christophe: Let's now move into the Q&A session market Francois joining me on stage.

Christophe: If you wish to ask a question. Please raise your hand, you will find the yellow and I can in the bottom toolbar of your application.

Christophe: As soon as I call. The new please on mute yourself, you will be able to mute yourself and once your question has been answered you will be placed on mute again.

François Roger: Foreign exchange had an exceptionally negative impact of 7.8% on net, following the significant and broad-based appreciation of the Swiss francs against our basket. On average, over the last 10 years, foreign exchange has had a negative impact of about 3.5% per annum on our reporting. In 2023, last year, this impact was more than twice. Total reported sales decreased by 1.5% to 93 billion.

Christophe: And maybe please.

Christophe: I ask you to ask only two questions at a time, so that everybody has an opportunity to speak.

Richard: So the questions are coming in I see the first one is from rich and Naidoo Reuters Richard Please go ahead.

Richa Naidu: Thank you, Christophe, and good morning. Thank you so much for doing this call. My two questions are, one, you know, you mentioned that price increases will slow this year, but I'm wondering how that's gonna happen, when freight costs are still quite high, especially with things like the Red Sea prompting them to go higher. And then my second question is. I guess, how are you going to keep prices lower? And my second question is, a major European coffee company said yesterday that new EU sanctions on Russia have created uncertainty over the future of its Russian business. Will they have the same impact on Nestlé's business there?

Richard Naidoo: Thank you Christophe and good morning. Thank you so much for taking this call.

Richard Naidoo: Two questions.

Richard Naidoo: One you.

Richard Naidoo: You mentioned that that price increases will slow this year, but I'm wondering how that's going to happen.

Richard Naidoo: And freight costs.

Richard Naidoo: Still quite high.

Richard Naidoo: Especially with things like the Red sea and prompting them to go higher.

François Roger: This slide illustrates the development of our sales by geography and includes both our zones as well as our globally managed business. Our business is geographically diverse. We operate in 188 countries.

Richard Naidoo: And then my second question is so I guess, how are you going to keep prices lower.

Richard Naidoo: And my second question is.

Richard Naidoo: A major European Coffee company, who said yesterday that new EU sanctions in Russia and has created uncertainty over the future of expression business.

François Roger: And we maintain a global footprint, with North America being our largest region in terms of revenue. As the chart shows, organic growth was positive in all geographies. Beyond pricing, the key drivers of growth were continued momentum for e-commerce and out-of-home channels across all regions. Growth was broad-based across geographies, and growth in Latin America was particularly strong. Just as a reminder, China delivered mid-single-digit growth in a geography that did not experience the same level of inflation as elsewhere. Let's now look at product categories. As the chart shows, organic growth was positive across all categories.

Do they have the same impact in that state.

Mark Schneider: Richa, thank you. This is Mark, and let me try and answer both of your questions. I think the situation on inflation and pricing this year is going to be a lot more nuanced from the two previous years. Rather than reflecting all commodities and all input costs going up, I think you will have select categories that will see increased input costs. As you do know, some commodities like cocoa, Robusta coffee, and sugar are still very high. Others have come down. I think the situation is gonna be a lot more nuanced.

Richard Naidoo: Michelle. Thank you this mark and let me try and answer both of your questions.

Michelle: Thank the situation on inflation in pricing. This year is going to be a lot more nuanced from the two previous years, so rather than reflecting all commodities in all input costs going up I think he will have select categories that we'll see increased input costs as you do.

Michelle: Some commodities like cocoa and.

Michelle: Robusta coffee and sugar is still very high others have come down and so I think the situation is going to be a lot more nuanced on freight overall, it's important to point out at the situation right now where there is some stress in especially on the former Red Sea routes and Tim routes that connect Europe to Asia on a call.

François Roger: Our largest category is powdered and liquid beverages, which accounts for more than a quarter of our total. Coffee, the largest component of this category, posted high single-digit growth, supported by continued momentum for out-of-home channels. Petcare was the largest growth contributor, with sales growing at a strong double-digit rate for the fourth consecutive year.

Mark Schneider: On freight overall, it's important to point out that the situation right now, while there is some stress, and especially on the former Red Sea routes and routes that connect Europe to Asia, on a global scale, the situation right now is nowhere near the disruption that we have seen in the year 2021. It's important to keep that in perspective, that the impact from this is gonna be a lot less on our company than it used to be in 2021 and beginning of 2022. Regarding Russia, no news on our side. I think we have fully complied with what we announced in March 2021, and at the moment, we see no change to that situation.

Michelle: Noble scale the situation right now is nowhere near the disruption that we have seen in the year 2021.

Michelle: And so it's important to keep that in perspective that the impact from this is going to be a lot less on our company than it used to be in 'twenty, one and beginning of 'twenty two regarding Russia No news on our side I think we have fully complied with what we announced in March 2021, and at the moment, we see no change.

François Roger: Growth was supported by continued e-commerce momentum and innovation, particularly for functional products. Nutrition and Health Science posted 5.4% growth. Nestle Health Science reported low single-digit growth as continued momentum for medical nutrition was partly offset by supply constraints for vitamins, minerals, and supplements in the second half of the year.

Michelle: To that situation.

Christoph Meier: Thank you, Richa.

Richa Naidu: Thank you.

Speaker Change: Thank you Richard.

Christoph Meier: Now the next question is from Ivo Ruch, Finanz und Wirtschaft. Please go ahead, Ivo.

Speaker Change: Now the next question is from Evo two financings are just.

Evo: Please go ahead evil.

Ivo Ruch: Good morning, everyone. My first question is on pet food. Do you expect there positive volumes in 2024? The second question is on the water operations. Do you see any impact on the financials from the announced review?

Evo: Good morning, everyone.

Evo: So my first question is on pet food.

Evo: Do you expect there are positive volumes in 'twenty.

Evo: 2024.

Speaker Change: And the second question is on.

Speaker Change: To watch operations do you see any impact on the financials from the announced review.

François Roger: Insight Nutrition reported 8.5% organic growth, with broad-based contributions across geographies, segments, and key branches; sales of our premium human milk oligosaccharide products grew at a strong double-digit rate, reaching 1.4 billion; prepared dishes and cooking aids, so 4.9% growth, driven by Maggie, which reported double digits; milk products on ice cream; we called it 6.1% growth. The key contributors to growth were The sales of ice cream grew at a mid-single day rate. Growth in confectionery was 8.5%, reflecting continued strong broad-based demand for KitKat, which continues to gain share across all geographies, as well as positive developments for key local. Finally, sales in water grew by 4.9% despite temporary capacity constraints for Perrier on a high base of comparison in 2018. San Pellegrino on Aquapana, so double dip.

Mark Schneider: Thank you, Ibu. As you know, generally, we do stay away from specific forecasts on volumes on our specific categories, but we do see very positive underpinnings in the pet food business going forward. It will not add up, in all likelihood, to the kind of double-digit growth that we have seen now for four consecutive years, but it will still be one of our highest growth categories going forward. With that, I'm confident that we can achieve positive continued positive volume growth in this area. On waters, it was important to flag this review to ensure so that the public and our investors have full visibility and transparency on this. It's too early now to give specific estimates what this means. The next question is from CNN, Hanna Ziady. Hanna, can you hear us?

Speaker Change: Thank you April so as you know generally we do stay away from.

April: Specific forecasts on volumes on our specific categories, but we do see very positive underpinnings in the pet food business going forward, it will not add up and more likelihood to the kind of double digit growth that we have seen now for four consecutive years, but it will still be.

April: One of our highest growth categories going forward and with that I am confident that we can achieve positive continued positive volume growth in this area.

April: And on waters. It was important to flag. This review to you so that the public and our investors have full visibility and transparency on this it's too early now to give specific estimates what this means.

Christoph Meier: The next question is from CNN, Hanna Ziady. Hanna, can you hear us?

Speaker Change: The next question is from CNN and CRE I don't know can you hear US. Please go ahead.

Mark Schneider: Please go ahead.

Christoph Meier: Please go ahead.

Hanna Ziady: Hi, good morning. Thanks very much for taking my question. Just want to follow up a little bit on the demographic opportunity you see in aging, which I think is really interesting. Could you give any more detail on sort of whether you've earmarked a specific amount of money that you're going to invest in these solutions? Or just any more color around, you know, either investments or sort of, you know, adding to teams in that area. And yeah, I think and sort of how then you see your product mix maybe changing in future. Because one of the questions I was going to ask was whether you think your infant formula business, for example, is going to become much smaller given the collapse in birth rates that we are seeing in many major economies.

CNN: Hi, good morning, Thanks, very much and for taking my question.

Speaker Change: Just wanted to follow up a little bit on the demographic opportunity you see in aging, which I think is really interesting could you give any more detail instead of whether you've earmarked a specific amount of money that you're going to invest in installations or just anymore color around and either invest.

Speaker Change: <unk> or sort of.

Speaker Change: You know, adding to teams and in that area.

Speaker Change: And yeah, I think and sort of how holiday and you see your product mix may be changing in future because one of the questions I was going to ask Chris witty ladies.

François Roger: After several years of progress on RIG until 2020, we went through a period of heavy turbulence, beginning with the pandemic, and followed by a period of unprecedented... These factors created significant volatility and clearly disrupted the components of our organic cells. During 2023, we have seen clear signs of normalization, with a lower contribution from pricing and a higher contribution from sales. We expect this trend to continue in the coming years. We are confident in our ability to return to positive RIG and expect RIG to trend back towards pre-COVID levels over the course of 2020. However, the phasing of RIG is not expected to be linear and should be more weighted to the second half of 2020. In the first quarter of 2024, we could be below the fourth quarter of 2023 given muted consumer demand and the residual impact of supply issues in our U.S. VMS supply chain. And just as a reminder, the first quarter has one less tradition.

Speaker Change: Where do you think youll infant formula business for example, banks become much smaller given the collapse in death rates that we are seeing in many major economies and and obviously you closed it actually in China, not too long ago. So do you think.

Hanna Ziady: Obviously, you know, you closed a factory in China not so long ago. Do you think? Yeah, how do you think the mix of your business is going to change? Maybe just a question on another one on pricing. Clearly, consumers have been trading down. Are there particular areas where that has been more pronounced than in other areas? Any particular products that you've seen that in? Do you think you're going to continue to see consumers trading down this year? If I'm correct in understanding, you think your prices are going to come down this year, but, and inflation is obviously falling rapidly, but, you know, a lot of people are still really struggling with high living costs.

Speaker Change: Yeah, how do you think the mix of your business is going to change and then maybe just a question on <unk>.

Speaker Change: And another one on pricing.

Speaker Change: Clearly consumers have been trading down.

Speaker Change: Are there particular areas, where that had been more pronounced than in other areas and any particular product.

Speaker Change: <unk> seen that in and then do you think you are and.

Speaker Change: Do you think you'd continue to see consumers trading down this yesterday.

Speaker Change: If I'm if I'm correct in understanding that you'll probably do you think your prices are going to come down this year, but and inflation is that the chipotle rapidly but in a lot of people are still really struggling with high living costs.

Hanna Ziady: How do you see the consumer behavior changing or not changing that much this year compared to last year? Yeah, that would be great. Thanks.

Speaker Change: How do you see the consumer behavior, changing or not changing that much this year compared to last year.

Speaker Change: Yeah that.

Speaker Change: That would be great. Thanks.

Mark Schneider: Hanna, thank you. Let me try and take a stab at the first question and then hand it to François for the second question. Obviously we're trying to be as helpful as possible to help you understand the opportunity. Having said that, it was hard for me to find a single number that describes the full extent of our efforts here, because as you can imagine, nutritional needs that may be relevant for another life stage may also be relevant for the healthy aging opportunity. Many of the things that we've done in the past can be taken off the shelf and then focused on the healthy aging opportunity. That's why a specific team size or investment amount now may not tell the full story.

Speaker Change: And I. Thank you and let me try and take a stab at the first question and then hand it to Francois for the second question. So obviously, we're trying to be safer as possible to help you understand the opportunity.

Speaker Change: Having said that it was hard for me to find a single number that describes the full extent of our airports here because as you can imagine nutritional needs.

Francois: That may be relevant for novel life stage may also be relevant for be helping our aging opportunities in many of the things that we've done in the past can be taken off the shelf and then focused on the healthy aging opportunity. So that's why a specific team size or investment amount now may not tell the full story.

François Roger: Next is underlying trading operating profit, which decreased by 0.3% to $16.1 billion. However, as a percentage of sales, it increased by 40 basis points during constant growth. The increase was driven by higher gross margin and lower distribution costs, which more than offset increased investments in marketing. And one of in 20. We are on track to deliver our 2025 targets of 17.5% to 18.5%. As expected, free cash flow increased from 6.6 billion Swiss francs to 10.4 billion Swiss francs as a consequence of a significant reduction in inventory.

Mark Schneider: It is something we're quite focused on and where between R&D and also our marketing teams and strategy teams across the categories, we're trying to maximize this opportunity that enjoys such a strong demographic tailwind. Let me also address the infant nutrition side, where it is true that we've seen now for a number of years globally declining birth rates. Let me say, as I pointed out in the presentation, it's important for us that we renew our commitment to offering superior nutritional solutions to all life stages, and that includes specifically what the company was founded on. That includes these incredibly important first 1,000 days and making sure that the best nutritional options are available at that time. The right start in life will make things a lot easier for the later stages in life.

Francois: It is something we're quite focused on and we're between R&D and also our marketing team and strategy teams across the categories. We're trying to maximize this opportunity that enjoys such a strong demographic tailwind. Let me also trash the infant nutrition side, where.

Francois: It is true that we've seen now for a number of years globally declining birth rates, but let me say as I pointed out in the presentation. It's important for us that we renew our commitment to offering superior nutritional solutions to all life stages and that includes specifically what the company was founded on it.

François Roger: As a reminder, the decision to increase inventories in 2022 was taken in the context of supply constraints and the Energy Crossing. At the same time, we have continued to invest in capital expenditure above historical levels to support the expansion of capacity, mainly in pet care. Working capital and CapEx are normalizing, and we are seeing a corresponding increase in free cash flow, trending back towards 12% of sales by 2025, in line with our mid-term financial. Finally, at this year's Annual General Meeting in April, the Board of Directors will propose a dividend of CHF3 per share, an increase of CHF5. If approved, this will be the company's 29th consecutive annual dividend increase, in line with our practice of increasing our dividend in Swiss francs year on year. The company has maintained or increased its dividend in Swiss francs over the last, The dividend in Swiss francs has more than tripled over the last 18 years, representing a compounded annual growth rate of close to 7%.

Francois: That includes these incredibly important first 1000 days and.

Francois: Making sure that the best nutritional and options are available at that time, the right start in life will make things a lot easier for the latest stages in life, and so that opportunity and technology leadership in that space.

Mark Schneider: That opportunity and technology leadership in that space continues to be very important to us. Even when declining birth rates make that opportunity somewhat smaller, it's important for us from a share perspective and technology perspective that we continue to lead in it.

Francois: Continues to be very important to us and to them.

Francois: Even when declining birth rates make that opportunity is and what smaller it's important for us from a share perspective, and technology perspective that will continue to lead in it.

François-Xavier Roger: We confirm absolutely the fact that there has been some trading down last year on probably a bit the previous year linked to the very high level of inflation, food inflation. Mark mentioned it earlier. It was the highest level in the last 50 years. It did put pressure on consumers, and we have seen a little bit of trading down. We do have offerings that are on the affordability segment, and we have plenty of offerings as well, obviously, in the mainstream segment. We have seen anywhere over the last 2 years the two extremes in the consumer pyramid, both premium is premium and affordability growing faster than what is in the middle, which is a mainstream offering.

Francois: And on your second question, which is are we confirm as we read the fact that there has been some trading down last year on probably a bit the previous year linked to the very high level of inflation food inflation Marc mentioned it earlier it was the highest level in India in the last 50 years. So it did put pressure on consumers and we have seen a little bit of trading that we do have.

Francois: Earnings that are on the affordability segment, and we have plenty of offerings as well obviously in the mainstream segment, we have seen anywhere over the last two years. The two extremes in the consumer pyramid, both premiums premium and affordability growing faster that what is in the middle which is a mainstream offering we have seen a little bit.

François-Xavier Roger: We have seen a little bit of trading down to the benefit of private labels, but it was more, and they regained market share a bit last year against most of the global brands like us and most of our peers. Actually, the private labels have gained market share, which corresponding more to the regaining of the market share that they had lost during the pandemic. There was no real major concern as far as we can see it. The other thing is that if you look at it over the last couple of months, we have started actually to regain market share against private label, which seems to indicate that they have probably reached the full potential of what they can achieve.

Francois: Trading down to the benefit of private labels.

Francois: But it was more on the regained market share a bit last year against most of the global brands like us on most of our peers, but actually the private labels of gain market share, which corresponding more to the regaining of the market share that they had lost during the pandemic. So there was no real major concern as far as are we.

Francois: Can see it the other thing is that if you look at it over the last couple of months, we have started actually to regain market share against private label, which seems to indicate that there probably reach the full potential of what they can achieve and once again, we do have sizable offerings and we did adapt our.

François-Xavier Roger: Once again, we do have sizable offerings, and we did adapt our innovation in order to make sure that we could provide affordable offerings to consumers in the context of a high inflation environment.

Francois: Innovation in order to make sure that we could provide affordable offerings to consumers in the context of a high inflation environment.

Christophe: This year's increase takes the dividend above the 3.3 francs level for the first time, reflecting our commitment to return cash to shareholders, many of whom rely on the steady and reliable income earned through their investments in Nestle. This concludes my presentation, and now I hand over to Christophe, who will moderate. Thank you, François. Let's now move into the Q&A session. Thanks for tuning in. If you wish to ask a question, please raise your hand. You will find the yellow hand icon in the bottom toolbar.

Christoph Meier: Thank you, Hanna. Sophie Marenne from AWP is next.

Christoph Meier: Thank you, Hanna. Sophie Marenne from AGFI is next.

Speaker Change: Thank you Hannah.

Hannah: So a female and from Azure Sea is next.

Sophie Marenne: Yes. Hi, thanks for the presentation. I have a question on health science. We've seen that, yes, there is execution problem. Seems quite disappointing after so many years of investment, so many acquisitions. My question, my first question is, as we see the subsidiary is not really delivering on its promises. Would a stronger integration under the Nestlé banner be on the cards? And second question, how to deal with the disappointment of investor, you know, that expect maybe much more from you, as, yeah, one of the biggest company on earth. That's my two questions. Thank you.

Hannah: Hi, and thanks for the presentation. So I had a question in the health science. So we see that yes, there is execution problem and it seems quite disappointing. After so many years of investment. So many acquisition. So my question is this question.

Hannah: And we see the subdued subsidiaries, not really delivering ani and premises woods and a stronger integration under the Leslie banner B undercurrents.

And second question how to deal with the appointment of Investor you know that expected maybe much more from.

Speaker Change: From you and one of the biggest companies. So that's my two questions. Thank you.

Mark Schneider: Thank you, Sophie. Look, let me start with the investor side right up front. As you know, business is inherently related to risk, and not everything that you embark on fully delivers on day one. That's why it's important for us that we put things and the facts very clearly on the table and give you full transparency. The full transparency is just strategically, we strongly believe, and I think we have the data to back it up, that this is a significant opportunity and continues to be a significant opportunity where we see continued strong growth going forward. The industry, after seeing outsized growth in vitamins during the COVID years, had about a 4- to 6-quarter period where just simply coming out of COVID, you had some growth compression.

Speaker Change: Thank you Sophie and look let me start with the Investor side right upfront.

Christophe: As soon as I call on you, please unmute yourself. You will be able to unmute yourself. And once your question has been answered, you will... Maybe, please, I may ask you to ask only two questions at a time so that everybody... The end. The first one is from Richa Naidoo of Reuters. Richa, please.

Speaker Change: Our business is inherently a related to risk and not everything that you embark on fully de levers on day, one and that's why it's important for us that we put things and the fact very clearly on the table and give you full transparency.

Speaker Change: And the full transparency as to a strategically.

Richa Naidoo: Thank you, Christoph, and good morning. Thank you so much for doing this call. So my two questions are, one, you mentioned that price increases will slow this year, but I'm wondering how that's going to happen when freight costs are still quite high, especially with things like the Red Sea prompting them to go higher. And then my second question is, so, I guess, how are you going to keep prices lower? And my second question is: a major European coffee company said yesterday that new EU sanctions on Russia have created uncertainty over the future of its Russian business. Will they have the same impact on Nestle's business there? Thank you.

Speaker Change: We strongly believe and I think we have the data to back it up.

Speaker Change: That this is a significant opportunity and continues to be a significant opportunity, where we see continued strong growth going forward.

Speaker Change: The industry after seeing outside growth in vitamins during the Covid years.

Speaker Change: We had about a four to six quarter period, where just simply coming out of Covid you had some CRO compression. It has since gone back to a very solid and dependable mid single digit growth, it's recreativo, but exactly at this time when it was rebounding just like coffee was rebounding at some point out last year.

Mark Schneider: It has since gone back to very solid and dependable mid-single digit growth. It's regrettable that exactly at this time when it was rebounding, just like coffee was rebounding at some point last year, that in Nestlé Health Science, as a result of these integration issues, we were not able to fully capitalize on that. I hope you also see that what we're talking to you about today is not like we're walking away from the targets. We're essentially saying to you that these integration issues have caused a delay in reaching the targets. This whole notion of healthy nutrition, micronutrient supplementation, and, as you see, some of the healthy aging solutions that are smack at the center of Nestlé Health Science, all of that, I think, are very worthy targets that will give us growth down the road.

Speaker Change: That in Nestle Health Science as a result of these integration issues, we were not able to fully capitalize on that but I hope you'll also see that what we're talking to you about today is not like we're walking away from the targets, we're essentially saying to you that these integration issues have caused a delay in reaching the targets this whole notion of healthy.

Mark Schneider: Thank you, Mark, and let me try and answer both of your questions. I think the situation on inflation and pricing this year is going to be a lot more nuanced than the two previous years. So rather than reflecting all commodities and all input costs going up, I think you will have select categories that will see increased input, do know some commodities like cocoa. All of us have come down, and so I think the situation is going to be a lot more. On freight overall, it's important to point out that the situation right now, while there is some stress, and especially on the former Red Sea route, routes that connect Europe to Asia, on a global scale And so it's important to keep that in perspective, that the impact from this is going to be a lot less than it used to be in the 21st century and beginning. Regarding Russia, no news on our side.

Speaker Change: In nutrition, Micronutrient supplementation and as you see some of the healthy aging solutions that are smack at the center of Nestle Health Science all of that I think.

Speaker Change: Very worthy targets that will give us growth down the road. So we will put this integration.

Mark Schneider: We will put this integration phase behind us. We will put this on the ground in a very reliable manner, and then afterwards, we will continue on the growth trajectory, which is also why I believe that the setup as a globally focused unit does continue to make sense. While we're doing the integration, we're making the full group resources available. Yes, we are strong when it comes to IT integration. We are strong in operational performance and that's given me confidence, and you will see that reflected in the growth performance later this year.

Speaker Change: Phase behind US we will put this on the ground in a very reliable manner and then afterwards, we will continue on the growth trajectory, which is also why I believe that the setup as a globally focused unit does continue to make sense, while were doing the integration were making the full group resources available and yes, we are strong when it can.

Speaker Change: <unk> two <unk> integration, we have strong operational performance and that gives me confidence and you will see that reflected in the CRO performance later this year.

Christoph Meier: The next question is from Johannes Richter, Frankfurter Allgemeine Zeitung. Please go ahead.

Speaker Change: Okay.

Speaker Change: The next question is from Johan selected Frankfurter Allgemeine Zeitung.

Johan: Go ahead.

Johannes Richter: Yes, good morning. Thank you. I have two topics. First, I'd like to touch on your water business. Just yesterday, Foodwatch has announced to sue Nestlé over cases of contaminated mineral water. It was saying that Nestlé has, I'm quoting, "deceived, ripped off, and defrauded consumers." What's your comment to this, and how did these incidents come about? What does it tell about your internal controls, were those not tight enough? In this context, I saw in your press release you were saying that Nestlé is reviewing its operating practices in the water business in several countries. Which countries are these?

Johannes Ritter: Yes, good morning. Thank you. I have two topics. First, I'd like to touch on your water business. Just yesterday, Foodwatch has announced to sue Nestlé over cases of contaminated mineral water. It was saying that Nestlé has, I'm quoting, "deceived, ripped off, and defrauded consumers." What's your comment to this, and how did these incidents come about? What does it tell about your internal controls, were those not tight enough? In this context, I saw in your press release you were saying that Nestlé is reviewing its operating practices in the water business in several countries. Which countries are these?

Johan: Yes. Good morning, Thank you I have two topics firstly.

Johan: I'd like to touch on your water water business.

Johan: Just yesterday, a food watch as.

Johan: As announced shoe lastly, ova cases of content contaminated Lulu mineral water.

Johan: And it was saying that they have.

Johan: I'm quoting deceived ripped off and deep product consumers.

Johan: Your comment to this and how.

Johan: That's.

Johan: The how did these incidents come about what does it tell about.

Mark Schneider: I think we have fully complied with what we announced in March 2021, and at the moment, we see no, and the next. Niboru, So my first question is about pet food.

Johan: <unk> internal controls weibo's slot side enough and in this context I saw in your press release, you were saying.

Johan: Leslie.

Johan: Is reviewing its operation operating practices in the water business in several countries, which countries are these.

Johannes Richter: The second topic, I would like to come back on what you said about the run on weight loss injections. I mean, many people think that this could actually, you know, be bad for your own business, but if I understood you right, it's the opposite. You see opportunities to grow within this flow. Is that right?

Johannes Ritter: The second topic, I would like to come back on what you said about the run on weight loss injections. I mean, many people think that this could actually, you know, be bad for your own business, but if I understood you right, it's the opposite. You see opportunities to grow within this flow. Is that right?

Ibu: Do you expect there to be positive volumes in 2024? And the second question is about water operations. Do you see any impact on the financials from the announced review? Thank you, Ibu. So, as you know, generally, we do stay away. This is a specific forecast on volumes on our..., but we do see very positive underpinnings in the pet food business going forward. It will not add up, in more likelihood, to the kind of double-digit growth that we have seen now for four consecutive years, but it will still be one of our highest growth categories going forward.

Johan: And the second to third.

Speaker Change: I'd like to come back.

Speaker Change: What you said about the run on weight loss injection I mean, many people think that this could actually.

Speaker Change: L B.

Speaker Change: Bad for your own business.

Speaker Change: If I understood you right.

Speaker Change: Obviously, you see opportunities to grow.

Speaker Change: Within this flow is that is that right.

Mark Schneider: Johannes, thank you. On the waters issue, we've seen the media reports about the Foodwatch publication. We have not seen the details of the suit yet. It hasn't been delivered to us yet, so we'll need to study that. Let me stress, since you used the word contamination, it's not about contamination. We did stress this very important primary goal of food safety in all our publications around that issue. That is something I wanted to assure all of the consumers about. Also wanted to stress and point out that the unique mineral content of our waters that's indicated on the label, that's exactly what you find inside the bottle. At this point, again, it's still very early days.

Speaker Change: Yeah understood. Thank you and so.

Speaker Change: So on the waters issue, we've seen the media reports about the food watch publication.

Speaker Change: Publication.

We have not seen the details of their sued yet it hasn't been delivered to us yet so we'll need to study that let me stress since you used the word combination its not about contamination.

Speaker Change: We did stress this very important primary goal of food safety in all of our publications around that issue and so that is something I wanted to assure all of our consumers about and also wanted to stress and point out that the unique mineral content of our waters. That's indicated on the label that's exactly it.

Mark Schneider: And with that, I'm confident that we can achieve continued positive volume growth. And on waters, it was important to flag this review to you so that the public and our investors have full visibility and transparency on this. It's too early now to give specific estimates. Good morning.

Speaker Change: What you find in Santa Barbara.

Speaker Change: At this point again, it's still very early days, what you've seen from the media reports over the last few weeks, we proactively had approached the French government. What this issue worked very patiently under their guidance to address these issues, we're now including a number of other countries and it was important for us to flatten out to you our.

Mark Schneider: What you've seen from the media reports over the last few weeks, we proactively had approached the French government with this issue, worked very patiently under their guidance to address these issues. We're now including a number of other countries, and it was important for us to flag that to you. Our primary responsibility in these countries is to talk to the relevant authorities first and have constructive discussions, which is why at this point, I wouldn't want to list other countries beyond the ones that have been mentioned in the media already, which are France and Switzerland. We'll keep you posted on any relevant development there. Regarding the weight loss drugs, if I could just continue there.

Unnamed Questioner: Thanks very much for taking my question. I just want to follow up a little bit on the demographic opportunity you see in aging, which I think is really interesting. Could you give any more detail on sort of whether you've earmarked a specific amount of money that you're going to invest?

Speaker Change: Our primary responsibility in these countries is to talk to the relevant authorities first and have constructive discussions which is why at this point I wouldn't want to list of countries beyond the ones that have been mentioned in the media already which are France, and Switzerland and will keep you posted on any relevant development beyond <unk>.

Mark Schneider: In these solutions or just any more color around, you know, either investments or sort of, you know, adding to teams in that area. Yeah, I think, and sort of how you see your product mix maybe changing in the future. Because one of the questions I was going to ask was whether you think your infant formula business, for example, is going to become much smaller given the collapse in birth rates that we are seeing in many major economies. And obviously, you know, you closed a factory in China not so long ago.

Speaker Change: The weight loss trucks, if I could just continue to bear.

Mark Schneider: This is an area that we believe will find good consumer interest, and there will be select individual products for which demand over time may be moderated as a result of these weight loss drugs. Again, it's important to see that the nutritional needs of GLP-1 patients are not going away. They're changing, and it was important for me to point out these opportunities to you. Then over time, we believe it's gonna be a balance between some products where demand may be moderated and others where demand will significantly increase. We believe there's an opportunity for us.

Speaker Change: So this is an area that we.

Speaker Change: We believe we'll find good consumer interest and there will be select individual products for which demand over time may be moderated as a result of his weight loss drugs, but again, it's important to see that the nutritional needs of GOP, one patients are not going away that changing.

Speaker Change: And it was important for me to point out these opportunities to you and then over time, we believe it's going to be a balance between some products where demand may be moderated and others, where demand will significantly increase and we believe there's an opportunity for us.

Johannes Richter: Okay. Well, just one follow-up on the water business. Is it now an option for you to withdraw completely from the water business? I mean, the margins are below average anyway.

Johannes Ritter: Okay. Well, just one follow-up on the water business. Is it now an option for you to withdraw completely from the water business? I mean, the margins are below average anyway.

Speaker Change: Okay, well just one follow up on the water business from it.

Mark Schneider: So do you think... Yeah, how do you think the mix of your business is going to change? And then maybe just a question on, and another one on pricing. Clearly, consumers have been trading down. Um, are there particular areas where that has been more pronounced than in other areas? Any particular products that you've seen that in?

Speaker Change: Is it an option for you to withdraw completely cold water business I mean, the margins are below average anyway.

Mark Schneider: We are working on these waters issues, and I think this is not the time to have a strategic debate around it.

Speaker Change: We are working on these waters issues and I think this is not the time to have a strategic debate around it.

Christoph Meier: Thank you, Johannes. The next question is from Jean-Philippe Rutz, Swiss Broadcasting System, RTS. Jean-Philippe, we need you to unmute yourself. Doesn't seem to work. We have an echo in the system. Maybe we move to the next one and come back to you, Jean-Philippe. The next question is from Dasha Afanasieva, Bloomberg.

Speaker Change: Thank you Johan has the next question is from Phillip routes. So this broadcast on <unk> RTL here.

Speaker Change: Yeah.

Sure.

Phillip: And equally I'm used to mute yourself.

Phillip: It doesn't.

Phillip: We have an excellent persistence, maybe we move to the next one and come back to usual Phillipe and the next question is from Dasher fantasy of a Bloomberg.

Jean-Philippe Rutz: I know I asked you this a bit on the other Newswire call, but I was just wondering if you could go into any more detail in how Nestlé is sort of protecting itself from, you know, in the context of high cocoa prices? Is it adjusting its approach in terms of increasing the marketing for brands that contain less chocolate, such as Häagen-Dazs or Milo, or encouraging consumers somehow else to seek out these products because they're now sort of relatively higher margin because of the costs? I know you answered about formulations, but anything else you could say about that would be really useful. Thanks.

Dasha Afanasieva: I know I asked you this a bit on the other Newswire call, but I was just wondering if you could go into any more detail in how Nestlé is sort of protecting itself from, you know, in the context of high cocoa prices? Is it adjusting its approach in terms of increasing the marketing for brands that contain less chocolate, such as Häagen-Dazs or Milo, or encouraging consumers somehow else to seek out these products because they're now sort of relatively higher margin because of the costs? I know you answered about formulations, but anything else you could say about that would be really useful. Thanks.

Phillip:

Dasher: I know I asked you and they ship it on E.

Unnamed Questioner: And then do you think... You are... Do you think you're going to continue to see consumers trading down this year? If I'm correct in understanding, you think your prices are going to come down this year, and inflation is obviously falling rapidly, but a lot of people are still really struggling with high living costs. So how do you see consumer behavior changing or not changing that much this year compared to last year? Yeah. That would be great.

Dasher: I think last call, but I was just wondering if <unk> any more detail and how.

Dasher: How necessary is protecting yourself from them.

Dasher: And in the context of high Tech HAE patients is it adjusting H H.

Dasher: In terms of.

Mark Schneider: And I thank you, and let me try and take a stab at the first question and then hand it to Francois. SEC. So obviously, we're trying to be as helpful as possible to help you understand the opportunity. Having said that, it was hard for me to find a single number that describes the full extent of our efforts because, as you can imagine, nutritional needs that may be relevant for another life stage may also be relevant for helping or aging opportunities. So many of the things that we've done in the past can be taken off the shelf and then focused on the healthy aging opportunity So that's why a specific team size or investment amount now may not tell the full story.

Dasher: The increase in the bunker tanks.

Change that's chocolate such as hard because of my life, well encouraging Kristine this from how else Chi.

Dasher: Fedex because they know they're right now relatively higher margin.

Speaker Change: And I know you're uncertain.

Speaker Change: About formulations.

Speaker Change: But anything else you can say about that would be released for thanks.

Mark Schneider: Yeah. Dasha, thank you. Obviously, as a company, we have a long history in cocoa and cocoa flavored products and a lot of brands that are beloved around the world. What's important to us is recipes that consumers are tuned into and whose flavor profile they appreciate and love, that these flavor profiles get fully upheld. Tinkering now with the recipes and flavor profiles simply because the input cost for cocoa has gone up, in my opinion, would be a mistake. This is clearly a long-term commitment that, you know, on these beloved brands, you will see, and you will continue to experience the beloved flavors that you've gotten used to. Obviously, by brand, by market environment, you need to see then tactically on marketing opportunities and how to adjust to this and brand support.

Speaker Change: Thank you and obviously as a company we have a long history in cocoa and cocoa flavored products and a lot of brands that up we laughed around the world what's important to us is Russia.

Mark Schneider: It is something we are quite focused on and where, between R&D and also our marketing teams and strategy. Across the categories, we're trying to maximize an opportunity that enjoys such a strong democratic voice. Let me also address the infant nutrition side, where it is true that we've seen now for a number of years... declining birth rates globally. But let me say, as I pointed out in the, It's important for us that we renew our commitment to offering superior institutional solutions to all life. That includes specifically what the company was founded on. That includes these incredibly important first 1,000 days, making sure that the best international options are available at... The right start in life will make things a lot easier for the later stages in life.

Speaker Change: Recipes that consumers are tuned into and whose flavor profile. They appreciate and love that these flavor profiles get fully upheld so tinkering now with the recipes and flavor profiles simply because.

Speaker Change: The input cost for cocoa has gone up in my opinion would be a mistake. This is clearly a long term commitment that you know on these beloved brands you will see and he will continue to experience the beloved flavors that you've gotten used to.

Speaker Change: Obviously by brand.

Speaker Change: By market environment, you need to see then tactically on marketing opportunities and how to adjust to this in brand support but it is like so many other commodity cost variations interest one more commodity cost variation.

Mark Schneider: It is like so many other commodity cost variations. It's just one more commodity cost variation that we tactically have to deal with. As a category, we're very strongly committed to a confectionery, and I think you've seen very good continued success as we put this confectionery category back on a growth track. KitKat certainly is the tip of the iceberg, but I think you're also seeing very good continued success on a number of other brands.

Speaker Change: That we tactically have to deal with as a category were very strongly committed to our confectionery and I think you've seen very good continued success as we put this confectionary category back on a growth track Kitkat certainly is the tip of the iceberg, but I think you're also seeing very good contingency.

Mark Schneider: So, that opportunity and technological leadership in that space continues to be very important to us. Even when declining birth rates make that opportunity somewhat smaller, it's important for us to share, and all that. On your second question, we absolutely confirm the fact that there was some trading down last year and probably a bit the previous year, linked to the very high level of food inflation, which was the highest level in the last 50 years. So it did put pressure on consumers, and we have seen a little bit of treading down. We do have offerings that are in the affordability segment, and we have plenty of offerings as well, in the mainstream segment.

Speaker Change: <unk> on a number of other brands.

Christoph Meier: Thank you, Dasha. The next question is from Matthias Benz, the NZZ. Please go ahead, Matthias.

Speaker Change: Thank you Tasha. The next question is from Martin Spence the answer to it. Please go ahead.

Matthias Benz: Good morning.

Good morning.

Mark Schneider: Good morning.

Matthias Benz: I have one question, regarding the share price development that's been quite disappointing recently. What is your assessment of the current share price and what are the main levers you see to increase it again? Thanks.

Martin Deboo: Good morning.

Martin Deboo: One costs.

Martin Deboo: Regarding the share price development is quite disappointing recently.

Martin Deboo: What is your assessment of the current share price.

Martin Deboo: What are the main levers.

Martin Deboo: To increase it again.

Martin Deboo: Thanks.

Mark Schneider: Matthias, thank you. Obviously, as a CEO and as operating management, it's important that we're not seen as interpreting for the public the share price. Our main job is to run the company the best possible way and to be sure then that investors also have the transparency that's needed to form their views about our future prospects and then price the shares properly. Let me just point out to you and our investors that of course, we're not happy with what we're seeing today. We're not contented with this and that we are deeply committed to convincing our investors through sustained, successful operating performance and then also reviewing every strategic option that's available in order to create value for our investors.

Martin Deboo: Okay.

Speaker Change: Thank you and.

Speaker Change: Obviously.

Speaker Change: As the CEO and his operating management, it's important that we're not seen as interpreting for the public the share price. Our main job is to run the company the best possible way and to be sure. Then that investors also have the transparency that's needed to form their views about our future prospects and then.

Speaker Change: Price the shares properly.

Speaker Change: Let me just point out to you and our investors that of course were not happy with what we're seeing today, we're not contended with this.

François Roger: We have seen, anyway, over the last two years, the two extremes in the consumer pyramid, both premium and affordability, growing faster than what is in the middle, which is mainstream. We have seen a little bit of threading down to the benefit of private labels, but it was more, and they regained market share a bit last year against most of the global brands like us and most of our peers. But actually, the private labels have gained market share, which corresponds more to the regaining of the market share that they had lost during the pandemic. There was no real major concern as far as we can see it.

Speaker Change: And that we are deeply committed to convincing our investors through sustained successful operating performance and then also revealed every strategic option that's available in order to create value for our investors.

Christoph Meier: The next question is from Dario Pelosi, Swiss Broadcasting System, SRF. Please go ahead, Dario. We seem to have a technical issue. Dario Pelosi, we can't hear you.

Speaker Change: The next question is from Dario Pelosi Swiss broadcasting system S. R F.

Dario Pelosi: Please go ahead. Thank you.

Dario Pelosi: To have a technical issue tire Pelosi, we can't hear you.

Mark Schneider: Maybe you need to unmute yourself.

Christoph Meier: Maybe you need to unmute yourself.

Dario Pelosi: Maybe you need to on mute yourself.

Dario Pelosi: Maybe you hear me now?

Mark Schneider: Now we can hear you. Yeah.

Dario Pelosi: Maybe you hear me now.

Dario Pelosi: Perfect. Good morning. Sorry for the technical issues. Could you give me a little bit more color on your coffee business? You have on the one hand, coffee price spike, and the shortages due to climate change on the coffee. Then you have to focus on the prime product. Where do you see the coffee business going to?

Dario Pelosi: We can hear you perfect. Okay. Good morning, sorry for the technical issues.

Sophie Marraine: The other thing is that, over the last couple of months, we have started to regain market share against private labels, which seems to indicate that they have probably reached the full potential of what they can. And once again, we do have sizable offerings, and we have adapted our innovation in order to make sure that we could provide affordable offerings in the context of high inflation. Sophie Marraine from AGC is.

Dario Pelosi: Could you give me a little bit more color on your coffee business you have on the one hand you have.

Dario Pelosi: Rafi price Spike and you have the shortages due to climate change on the coffee then you have to focus on the price.

Dario Pelosi: And our products.

Dario Pelosi: Where do you see the Kosmos business are going to.

Mark Schneider: Thank you, Dario. It's important that we discuss this because as you know, coffee is one of our key categories. I think it is important to separate the longer term climate change issue, which I know has been debated over the last few months with increasing intensity, from some of the short-term dynamics we're seeing. On the longer term climate change issue, we take that seriously, and we have taken it seriously for many decades. In fact, with climate change that has already happened, you see that either further north, further south, or at a higher altitude, new coffee growth areas have been developed over the last few decades that take over from some of the areas where the heat may have become excessive.

Thank you Dario and Tim it's important that we discussed is because as you know coffee is one of our key categories. I think it is important to separate the longer term climate change issue.

Mark Schneider: Hi, thanks for the presentation. So I have a question on health science. So we've seen that, yes, there are execution problems. Seems quite disappointing after so many years of investment and so many acquisitions. So my question, my first question is, as we see the subsidiary is not really delivering on its promises. Would a stronger reintegration under the Nestle banner be on the cards? And second question, how to deal with the disappointment of investors, you know. I expect maybe much more from you as one of the biggest companies on earth, so those are my two questions. Thank you. Thank you, Sophie.

Dario Pelosi: Which I know has been debated over the last few months with increasing intensity from some of the short term dynamics, we're seeing on the longer term climate change issue, we take that seriously and we have taken it seriously for many decades in fact with climate change that has already happened you see that either forever.

Dario Pelosi: Half of our South, Florida, and high altitude, new coffee growth areas have been developed over the last few decades that take over from some of the areas where the heat may have become excessive we also did do extensive work.

Mark Schneider: We also did do extensive work when it comes to creating coffee varieties and seedlings and making those available that are more drought resistant. I think this is a good example where on the ground we're helping farmers. By doing that, we're not only helping the farming community, we are also helping the overall global coffee business adjust to the climate change that happened underway already and has been underway already over several decades. A good example for a new coffee growth area is the Yunnan region in China, where over the last 25 years we have been contributing patiently to the growth of the coffee industry. That, of course, is helping us now supplying the increasing demand coming from China for coffee.

When it comes to creating coffee varieties and seedlings and making those available that are more trotta assistant and I think this is a good example, where on the ground, we're helping farmers and Baidu map, where not only happened in the farming community. We are also helping the overall global coffee business.

Mark Schneider: And look, let me start with the investor side right up front. As you know, business is inherently related to risk, and not everything that you embark on fully delivers on day one. And that's why it's important for us that we put.

Dario Pelosi: As to the climate change that happened under way already and has been underway already over several decades. A good example for a new coffee growth area is the Union region.

Mark Schneider: Thanks for watching, and the full transparency is just strategic. We strongly believe, and I think we have the data to back it up... that this is a significant opportunity and continues to be, where we see continued strong growth going on. The industry, after seeing outside growth in vitamins during COVID, had about a four to six quarter period where just simply coming out of COVID, has since gone back to a very solid and dependable mid-single-digit growth. Incredible, but exactly at this time when it was rebounding, just like coffee was rebounding.

Dario Pelosi: In China, where over the last 2025 years, we have been contributing patiently.

Dario Pelosi: To the chrome off the coffee industry and that of course is helping us now supplying the increasing demand coming from China for coffee short term.

Mark Schneider: Short term, until about Q2 last year, you saw a bit of a year-over-year slowdown in the coffee segment at home. This was post-COVID, people returning to work and consuming less cups of coffee at home and more coffee again out of home. I think we successfully lapped that, and you see this proven in the performance of Nespresso in H2 of the year, which was quite convincing. Now, of course, you're dealing with some short-term pricing issues, Robusta being a coffee variety that trades very high, certainly against Arabica at fairly historic levels. These are operational issues, just like on the cocoa question earlier, it doesn't change our significant growth prospects in this area.

Dario Pelosi: Until about the second quarter last year, you saw a bit of a year over year slowdown in the coffee segment at home.

Dario Pelosi: And this was post COVID-19. So this was people returning to work and consuming less cups of coffee at home and more coffee more coffee again out of home.

Dario Pelosi: I think we successfully lapped that and you see this.

Mark Schneider: And in Nestle Health Science, as a result of these integration issues, we were not able to fully capitalize on it. But I hope you also see that what we're talking to you about today is not like we're walking away from. We're essentially saying to you that these integration issues have caused a delay in reaching this whole notion of healthy and micronutrient supplements. As you see, some of the healthy aging solutions that are smack at the center of Nestle Health Science are very worthy targets that will give us a croak down the road. So we will put this integration into effect.

Dario Pelosi: Proven and the performance of espresso in the second half of the year, which was quite convincing and now of course, you're dealing with some short term pricing issues robusta being a coffee variety that trades very high.

Dario Pelosi: Certainly against our Robbie car at fairly historic levels, but these are operational issues just like on the cocoa question earlier it doesn't change our significant growth prospects in this area. We are adjusting to it operationally and we'll continue to see success in coffee.

Mark Schneider: We are adjusting to it operationally and, we'll continue to see success in coffee. We're now going back to Jean-Philippe Rutz and see whether the technical issues has been resolved. Jean-Philippe, please go ahead. You probably need to unmute yourself.

Mark Schneider: We are adjusting to it operationally and, we'll continue to see success in coffee.

Christoph Meier: We're now going back to Jean-Philippe Rutz and see whether the technical issues has been resolved. Jean-Philippe, please go ahead. You probably need to unmute yourself.

Speaker Change: We're now going back to raw Philly puts and see where there's a technical issues have been resolved Shawn Phillips. Please go ahead.

Shawn Phillips: You probably need to on mute yourself.

Jean-Philippe Rutz: Oh.

Mark Schneider: Yes, we can hear you. Doesn't work. Let's continue. Next question is from Laura Onita, Financial Times. Please go ahead. Go ahead, Laura.

Christoph Meier: Yes, we can hear you. Doesn't work. Let's continue. Next question is from Laura Onita, Financial Times. Please go ahead. Go ahead, Laura.

Shawn Phillips: Yes, we can hear you.

Shawn Phillips: So it doesn't it doesn't work so let's continue.

Next question is from.

Shawn Phillips: Laura on at the financial Times. Please go ahead go ahead.

Laura Onita: Morning. Thank you for doing this. I think you said earlier, you know, that there has been some hesitancy among Middle East shoppers. You've also had companies such as Unilever experience various trends in the trading because of this. I was just wondering if you might be able to tell us a bit more about what you might be seeing at this stage.

Laura: Well good morning, Thank you for doing that and I think you said and earlier you know that there has been some hesitancy among middle east shopping and able to help companies such as Unilever and experience Barry.

Mark Schneider: While we're doing the integration, we're making the full group resources available, and yes, we are strong when it comes to IT integration. We are strong in operations. That's given me confidence, and you will see that, crawl for. The next question is from Johannes Ritter, Frankfurter Allianz. Good morning.

Laura: Trends in the trading because of this and I was just wondering if you might be able to and they tell us a bit more about what you might be seeing at this stage.

Johannes Ritter: Thank you. I have two topics. First, I'd like to touch on your water business. Just yesterday, Foodwatch announced that it would sue Nestle over cases of contaminated mineral water, and it was saying that Nestle has, I'm quoting, deceived, ripped off, and defrauded consumers. What's your comment on this, and how did these incidents come about? What does it tell about his personal interest?

Mark Schneider: Thank you, Laura. I think what we've seen after the tragic events of 7 October is across the Middle East and some other countries in Asia, consumer hesitancy in general when it comes to global and Western brands, nothing where I would see that it's targeted specifically at our company. It's more of a global trend overall, and local companies are benefiting from that. That trend I think for the moment continues. I don't see it particularly accelerating or decelerating, and then we'll need to see where things develop in 2024. The next question is from Richa Naidu, Reuters.

Speaker Change: Thank you Laura I think what we've seen after the tragic events of October seven.

Speaker Change: Across the middle East and some other countries in Asia consumer hesitancy in general when it comes to global and Western brands.

Speaker Change: Nothing where I.

Laura: I would see that it's targeted specifically at our company, it's more of a global trend overall.

Laura: Local companies are benefiting from that.

Laura: And that.

Laura: That trend I think for the moment continues I don't see it, particularly accelerating or decelerating and then we'll need to see where things taper off in 'twenty four.

Mark Schneider: And the second topic I'd like to come back to what you said about the run on weight loss injections. I mean, many people think that this could actually be bad for your own business. If I understand you right, it's the opposite. You see opportunities to grow within this flow. Is that right? Thank you, and so on the waters issue, we've seen the media reports about food water, but we have not seen the details. To learn more, The Mistress, since you used the word contamination.

Christoph Meier: The next question is from Richa Naidu, Reuters.

Laura: And the next question is from rich and I do Reuters.

Richa Naidu: Hi. Thanks for taking a couple more questions from me. I just wanted to ask what specific products or brands might be easiest for you to reduce or slow price hikes on? My second question is, I see that price increases in China were much lower than other regions. Are you seeing a deflationary environment in China, and if so, how are you dealing with it? Thank you.

Rich: Hi, Thanks for taking a couple more questions for me I just wanted to ask what specific products or brands might be easiest for you to reduce the slow price hikes on and then my second question is I see that price increases in China were much lower than other regions are you seeing a deflationary environment in China and if so how.

Mark Schneider: It's not about contamination. We did stress this very important primary goal of food safety in all our publications around that issue. So that is something I wanted to assure all of them and also wanted to stress and point out the unique mineral content of our water, indicated on the label. That's exactly right.

Speaker Change: You're dealing with it thank you.

Mark Schneider: Yeah. Thank you, Richa. Regarding China, I think that over the last year, we've seen lower inflation levels than elsewhere on the globe. It's not exactly a deflationary environment, but the inflation rates were lower than elsewhere. That's why the posted organic growth numbers were not as high as you've seen in some of our other geographic zones. Going forward now, it's hard to guess exactly where things are going. I'm still seeing a very moderate price development. I'm not seeing very strong signs for real deflation. Regarding the products and adjustments on prices, again, this varies a lot by category, by country, so it's hard to answer that one specifically. I ask for your understanding.

Rich: Yeah.

Speaker Change: Thank you Richard so regarding China.

Speaker Change: I think that over the last year, we've seen lower inflation levels than elsewhere on the cloud and.

Speaker Change: It's not exactly a deflationary environment, but the inflation rates were lower than elsewhere, and that's why the posted organic growth numbers were.

Speaker Change: Were not as high as you've seen in some of our geographic zones.

Mark Schneider: At this point, again, it's still very early days. What you've seen from the media reports over the last few weeks is that they proactively approached the French government with this issue, and worked very patiently under their guidance to address these issues. We're now including a number of other countries, and it was important for us to flag that to you. Our primary responsibility in these countries is to talk to the relevant authorities first and have constructive discussions. That's why, at this point, I wouldn't want to list other countries beyond the ones that have happened.

Speaker Change: And going forward now, it's hard to guess exactly where things are going.

Speaker Change: I'm still seeing a very moderate price development and I'm not seeing very strong signs for real deflation rigs.

Speaker Change: Regarding the products and adjustments on prices again this varies a lot by category by country. So it's hard to answer that one specifically or ask for your understanding.

Christoph Meier: We don't see any further questions. It looks like we are done. At this point, I would like to thank you again very much for joining us this morning and for having joined us. If you have any further questions, don't hesitate to reach out to the corporate media team, and we will get back to you. Thank you very much and have a nice day.

Speaker Change: Yeah.

Speaker Change: We don't see any further questions it looks like we're done.

So at this point I would like to thank you again very much for joining us this morning for having joined us and.

Speaker Change: If you have any further questions don't hesitate to reach out to the corporate media team and we will get back to you.

Speaker Change: Thank you very much and have a nice day.

Speaker Change: [music].

Mark Schneider: Media, what? We'll keep you posted on any relevant developments. Regarding the weight loss trucks, if I could just continue there, so this is an area. We believe we'll find good consumer interest, and there will be select individual products for which demand over time may be moderated as a result. But again, it's important to see that the nutritional needs are not going away; they're changing. It's important for me to point out these opportunities. And then, over time, we believe there's going to be a balance between some products where demand may be moderated, and others... Demand will significantly increase. We believe this.

Speaker Change: Okay.

Speaker Change: [music].

Speaker Change: Okay.

Speaker Change: [music].

Johannes Ritter: Okay, well, just one follow-up on the water business. Is it now an option for you to withdraw completely from the water business? I mean, the margins are below average anyway.

Mark Schneider: We are working on these water issues, and I think this is not the time. Thank you, from Constituencies RTS. All I need to do is unmute you. It doesn't work.

Speaker Change: Great.

Speaker Change: [music].

Christophe: Maybe we can move to the next one and come back to you, Jean-Philippe. The next question is from Dasha Afanasyeva, from Bloomberg. I know I asked you this a bit on the other Newswires call, but I was just wondering if you could go into any more detail about how..., how Nestle is. Thank you. Bye bye.

Dasha Afanasyeva: In the context of high cocoa prices, is it adjusting its approach in terms of increasing the marketing for brands that contain less chocolate, such as Hagen-Dazs or Milo, or encouraging consumers somehow else to buy these products because they are now sort of relatively higher margin because of the cost? I know you answered about formulation, but anything else you could say about that, the, Just because we pay our taxes doesn't mean we're lethal.

Mark Schneider: Thank you. And obviously, as a company, we have a long history of cocoa and cocoa flavored products, a lot of brands that have been laughed around the world. What's important to us are recipes that consumers are tuned in to whose flavor profile they appreciate and love; these flavor profiles get fully updated. Tinkering now with the recipes and flavor profiles simply because The Input Cost for CoCo has gone up, in my opinion, would be

Mark Schneider: This is clearly a long-term commitment. You know, with these beloved brands, you will see, and you will continue to experience, the beloved flavors that you've got. Obviously, by brand, by market environment.

Mark Schneider: You need to see events tactically in terms of marketing opportunities and how to adjust to this and brand support. But it is like so many other commodities, cost variation is just one more commodity. In this category, we're very strongly committed to the confectionary category. I think you've seen very good continued success as we put this confectionary category back on the clove track. Kit Kat certainly is about the iceberg, but I think you also have very good continued success on a number of.

Dario Pelosi: The next question is from... Good morning. I have one question regarding the share price development. Pointing to recent developments, what is your assessment of the current share price? What are the main levers you see to it?

Unnamed Questioner: Thank you. Thank you. Thank you. CEO, and his operating manager.

Mark Schneider: It's important that we're not seen as interpreting for the public, the share. Our main job is to run the company in the best possible way, to be sure then that investors also have transparency to form their views about our future prospects and then price, prop. Let me just point out to you and our investors that, of course, we're not happy with what we're seeing today. We're not contented, and we are deeply committed to convincing our investors through sustained, successful operations and then also reviewing every strategic option that's available in order to create value for our customers. The next question is from Dario Pelosi. Dario Pelosi, who can't...

Dario Pelosi: If you unmute yourself, maybe you can hear me now? No, we can hear you. Yeah. Perfect. Good morning. Sorry for the technical issues.

Speaker Change: [music].

Mark Schneider: Could you give me a little bit more color on your coffee business? You have, on the one hand, you have a coffee price spike, and you have shortages due to climate change on coffee. Then you have to focus on the prime product.

Mark Schneider: Where do you see the coffee business going? Thank you, Dario and Tim. I think it is important that we discuss this because, as you know, coffee is one of our key categories for longer-term climate change, which I know has been debated over the last few months. For more information, visit www. FEMA.gov, from some of the short-term dynamics. On the longer term, climate change is here. We take that seriously, and we have taken it seriously for many decades.

Mark Schneider: In fact, with climate change that has already happened, you see... Either further north or further south, or at a higher altitude, new coffee grove areas have been developed over the last few decades, taking over from some of the areas where the heat may have become. We also did extensive work when it comes to creating coffee varieties and seedlings and making those available that are more drought-resistant. I think this is a good example where, on the ground, we are helping farmers. And by doing that, we're not only helping the farming community; we are also helping the overall global coffee business address the climate change that has been underway already and has been underway for several decades. A good example for a new coffee grove area is the Yunnan region in China, where over the last 20, 25 years, we have been contributing to the growth of the coffee industry. And that, of course, is helping us now supply the increasing demand coming from, for the short term, until about the second quarter last year, you saw a bit of a year-over-year slowdown in the coffee segment at home. And this was post COVID.

Speaker Change: Okay.

Speaker Change: [music].

Mark Schneider: So this was people returning to work and consuming fewer cups of coffee at home and more coffee again, proven in the performance of Nespresso in the second half of the year, which was quite convincing. And now, of course, you're dealing with some short-term pricing issues, Robusta being a coffee variety that trades very high, certainly against a robbery. But these are operational issues, just like the cocoa question earlier. You can grow prospects in this area. We are just into it, and we will continue this. We're now going back to Jean-Philippe Routes to see whether... and Rizal. Jean-Philippe, please, on mute.

Speaker Change: Yes.

Speaker Change: [music].

Jean-Philippe Routes: Huh? Yes, we can. So let's continue. And the next question is from... Laura Onita, Finance. Go ahead, go ahead.

Laura Onita: Morning, thank you for doing this. I think you said earlier that there has been some hesitancy among Middle East shoppers. You've also had companies such as Unilever experience various trends in trading because of this, and I was just wondering if you might be able to tell us a bit more about what you might be seeing at this stage. Thank you, Lauren.

Speaker Change: Great.

Speaker Change: Sure.

Speaker Change: [music].

Mark Schneider: I think what we've seen after the tragic events of October 7th, across the Middle East, and some other countries in Asia. Consumer hesitancy in general when it comes to global..., nothing where I would see.

Mark Schneider: Targett, specifically at our company, it's more of a global trend overall; local companies are benefiting from that. That trend, I think, for the moment... I don't see it becoming particularly accelerating or decelerating, and then we'll need to see where things develop. The next question is from Richa Naidoo.

Richa Naidoo: Hi, thanks for taking a couple more questions from me. I just wanted to ask, what specific products or brands might be easiest for you to reduce or slow price hikes on? And then my second question is: I see that price increases in China were much lower than in other regions. Are you seeing a deflationary environment in China? And if so, how are you dealing with that?

Speaker Change: Sure.

Speaker Change: [music].

Mark Schneider: Thank you. Thank you, Richard. So regarding China, I think that over the last year we've seen lower inflation levels than elsewhere, club, and. It's not exactly a deflationary environment, but the inflation rates were lower than elsewhere. And that's why the posted organic growth numbers were not as high as you've seen in some of our geographic zones. And going forward now, it's hard to guess exactly where things are going. I'm still seeing very moderate price developments. I'm not seeing very strong signs of real growth.

Speaker Change: Yes.

Speaker Change: [music].

Regarding the products and adjustments on prices, again, this varies a lot by category, by country, so it's hard to answer that one specifically. I don't see any further questions, so it looks like we are done. I would like to thank you again very much for joining us this morning, for having joined us, and if you have any further questions.., to reach out to the corporate media team and we will get back. Thank you very much and have a, ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? Thank you for watching! ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com www.nestle.com, ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??

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