Q2 2024 Oatly Group AB Earnings Call

Good day and welcome to the Oatly Second Quarter Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions.

Operator: All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on a touch-tone phone; to withdraw your question, please press star then 2.

Operator: The participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Operator: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded.

To ask a question, you may press star, then 1 on a touch-tone phone.

Operator: Please note this event is being recorded. I would now like to turn the conference over to Brian Kearney from Investor Relations. Please go ahead.

To withdraw your question, please press star then 2. Please note this event is being recorded. I would now like to turn the conference over to Brian Kearney from Investor Relations. Please go ahead.

Brian Kearney: I would now like to turn the conference over to Brian Kearney from Investor Relations. Please go ahead.

Brian Kearney: Good morning, and thanks for joining us today. On today's call, our chief executive officer, John Christophe Platon, our chief operating officer, Daniel Ordonez, and our chief financial officer, Maria Jose W.

Brian Kearney: Good morning, and thanks for joining us today. On today's call are Chief Executive Officer Jean-Christophe Platon, our Chief Operating Officer, Daniel Ordonez, and our Chief Financial Officer, Marie-Josée Davy. Before we begin, please review the disclaimer on slide three. During this call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our future results of operations and financial position, industry and business trends, business strategy, market growth, and anticipated cost savings.

Brian Kearney: Good morning, and thanks for joining us today.

Speaker Change: On today's call are Chief Executive Officer, Jean-Christophe Platon, our Chief Operating Officer, Daniel Ordonez, and our Chief Financial Officer, Marie-Josée W.

Speaker: Before we begin, please review the disclaimer on slide three. During this call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our future results of operations and financial position, industry and business trends, business strategy, market growth, and anticipated cost savings. These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could differ spiritually from actual events or those described in these forward-looking statements.

Brian Kearney: These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could differ materially from actual events or those described in these forward-looking statements. Please refer to the documents we have filed with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Also, please note on today's call, management will refer to certain non-IFRS financial measures, including EBITDA, adjusted EBITDA, constant currency revenue, and free cash flow.

Speaker Change: Before we begin, please review the disclaimer on slide 3.

Brian Kearney: While the company believes these non-IFRS measures will provide useful information, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS. Please refer to today's release for a reconciliation of the non-IFRS financial measures to the most comparable measures prepared in accordance with IFRS. In addition, Oatly has posted a supplemental presentation on its website for reference. With that, I would now like to turn the call over to Jean-Christophe. Thank you, Brian, and good morning, everyone.

Speaker Change: During this call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our future results of operations and financial position, industry and business trends, business strategy, market growth, and anticipated cost savings.

Jean-Christophe Platon: Slide 5 is the key messages I want you to take away from today's presentation. First, during the second quarter, we continued to make good progress on strengthening the business and moving towards achieving profitable growth. You can see that clearly in our accelerated top-line growth and improved margins, as well as how we are activating the brand in each of our markets. This continued improvement is driven by our progress on our 2024 strategic priorities of bringing the Oatly magic to more people, continuing our calibration of resources, and a continued focus on executional excellence.

Speaker Change: These statements are based on management's current expectations and beliefs and involvement.

Jean-Christophe Platon: Finally, given our solid performance through the first half of the fiscal year and an increased confidence in our second-half performance, we are updating our full-year guidance to be slightly more favorable than the previous outlook. We know it's fair.

Speaker Change: risks and uncertainties that could differ materially from actual events.

Speaker: Please refer to the documents we have filed with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Also, please note, on today's call, management will refer to certain non-IFRS financial measures, including EBITDA, adjusted EBITDA, Consecurrency revenue, and free cash flow. While the company believes these non-IFRS measures will provide useful information, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS. Please refer to today's release for reconciliation of the non-IFRS financial measures to the most comparable measures prepared in accordance with IFRS.

Speaker Change: or those described in these forward-looking statements.

Speaker Change: Please refer to the documents we have filed with SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today.

Speaker Change: Also, please note, on today's call, management will refer to certain non-IFRS financial measures including EBITDA, adjusted EBITDA, constant currency revenue, and free cash flow. While the company believes these non-IFRS measures

Speaker Change: will provide useful information, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS.

Speaker Change: Please refer to today's release for reconciliation of the non-IFRS financial measures to the most comparable measures prepared in accordance with IFRS.

Speaker: In addition, earlier posted a supplemental presentation on its website for reference.

Speaker Change: In addition, Oatly has posted a supplemental presentation on its website for reference. With that, I would now like to turn the call over to Jean-Christophe. Thank you, Brian , and good morning, everyone.

Jean-Christophe Platon: With that, I'd now like to turn the call over to Jean-Christophe. Thank you, Brian, and good morning, everyone. Slide five. As the team messages, I want you to take away from today's presentation. First, during the second quarter, we continue to make good progress on strengthening the business and moving towards achieving profitable goals. You can see that clearly in our federated supply goals and improved margins, as well as how we are updating the brand in each of our markets. This continued improvement is driven by our progress on our 2024 strategic priorities of bringing the ultimate magic to more people, continuing our calibration of results, and continued focus on execution of excellence.

Jean-Christophe Platon: Constant currency revenue growth in the range of 6% to 10%, compared to our prior guidance of 5% to 10%, adjusted PDA in the range of minus 35 to minus 50 million compared to our prior guidance of minus 35 to minus 60 million, and capital expenditures to be below $70 million compared to our prior guidance of below $75 million. Turning now to our report card on slide 6. Here, you can see we continue to make good progress on our journey towards profitable growth.

Jean-Christophe Platon: Slide 5 are the key messages I want you to take away from today's presentation.

Jean-Christophe Platon: First, during the second quarter, we continue to make good progress on strengthening the business and moving towards achieving profitable growth.

Jean-Christophe Platon: You can see that clearly in our accelerated top-line growth and improved margins, as well as how we are activating the brand in each of our markets.

Jean-Christophe Platon: This continued improvement is driven by our progress on our 2024 strategic priorities of bringing the Oatly magic to more people.

Jean-Christophe Platon: continuing our calibration of results and a continued focus on executional excellence.

Jean-Christophe Platon: Finally, given our strategic performance through the first half of the fiscal year, and an increased confidence in our second half performance, we are updating our full-of-guidance to be slightly more favorable than the previous outlook. We now expect a constant guarantee level in the range of 6 to 10 percent compared to a higher guidance of 5 to 10 percent. Adjusted at the DA in the range of minus 35 to minus 50 million compared to a higher guidance of minus 65 to minus 60 million, and capital expenditure to be below 70 million compared to a higher guidance of below 75 million.

Jean-Christophe Platon: Finally, given our solid performance through the first half of the fiscal year and an increased confidence in our second-half performance, we are updating our full-year guidance to be slightly more favorable than the previous outlook.

Speaker Change: We know it's fair.

Speaker Change: Constant currency revenue growth in the range of 6% to 10%, compared to our prior guidance of 5% to 10%.

Speaker Change: Adjusted FDA in the range of minus 35 to minus 50 million compared to our prior guidance of minus 35 to minus 60 million.

Speaker Change: and capital expenditures to be below $70 million compared to our prior guidance of below $75 million.

Jean-Christophe Platon: Turning now to a revoked curve on slide 6. Here, you can see we continue to make good progress on our journey to work for feasible goals. As you can see, total company volume accelerated to a 10 percent year-over-year increase in the quarter as we draw volume goals in every region. Growth margin increased sequentially by approximately 200 basis points in this quarter to 29 percent, which is 10 full percentage points higher than last year's second quarter. This is a significant improvement from the 11 percent margin we reported for the four years 2022. We still have plenty of work to do to get to our longest-term target, but we are clearly making good progress.

Speaker Change: Turning now to our report card on slide 6.

Speaker Change: Here, you can see we continue to make good progress on our journey towards profitable growth.

Jean-Christophe Platon: As you can see, total company volume accelerated to a strong 10% year-over-year increase in the quarter as we saw volume growth in every region. Gross margin increased sequentially by approximately 200 basis points in this quarter to 29%, which is 10 full percentage points higher than last year's second quarter.

Speaker Change: As you can see, total company volume accelerated to a strong 10% year-over-year increase in the quarter as we drop volume growth in every region.

Speaker Change: Gross margin increased sequentially by approximately 200 basis points in this quarter to 29%, which is 10 full percentage points higher than last year's second quarter.

Jean-Christophe Platon: This is a significant improvement from the 11% margin we reported for the full year 2022. We still have plenty of work to do to get to our longer-term targets, but we are clearly making good progress. [inaudible] We have made noteworthy progress on our adjusted BDA. In 2022, we reported quarterly losses between $53 million and $83 million.

Speaker Change: This is a significant improvement from the 11% margin we reported for the full year 2022.

Speaker Change: We still have plenty of work to do to get to our longer-term targets, but we are clearly making good progress.

Jean-Christophe Platon: Primarily, we have made noteworthy progress on our adjusted EBDA. In 2022, we reported quarterly losses between 53 million to 83 million. Today, we are reporting the quarterly loss of just 11 million and our fourth consecutive quarter of sequentially improving adjusted EBDA.

Speaker Change: Similarly, we have made noteworthy progress on our adjusted EBITDA. In 2022, we reported quarterly losses between $53 million to $83 million.

Jean-Christophe Platon: Today, we are reporting a quarterly loss of just $11 million and our fourth consecutive quarter of sequentially improving adjusted EBITDA. Slide 7 gives you an update on where the operating segments are on their respective improvement plans. Recall that we have been methodically applying the same transformation formula to each region.

Speaker Change: Today, we are reporting a quarterly loss of just $11 million and our fourth consecutive quarter of sequentially improving adjusted EBITDA.

Jean-Christophe Platon: Slide 7 gives you an update on where the operating segments are on their respective improvement plans. Recall that we have been methodically applying the same confirmation formula to each region. We started our work with our Europe and international segments. Our progress in Europe is our confidence in our approach. We then applied the same framework to our North America segment, and we gained further confidence. And one year ago, we began applying the framework to our Greater China segment. As such, our European and international segments is the first restaurant, and it has been consistently driving profitable goals while investing in brand trading and innovation.

Speaker Change: Slide 7 gives you an update on where the operating segments are on their respective improvement plans.

Speaker Change: Recall that we have been methodically applying the same transformation formula to each region.

Jean-Christophe Platon: We started our work with our European and international segment. Our progress in Europe builds our confidence in our approach. We then applied the same framework to our North America segment, and we gained further confidence. And one year ago, we began applying the framework to our Greater China segment.

Speaker Change: We started our work with our European and international segments.

Speaker Change: Our progress in Europe builds our confidence in our approach. We then apply the same framework to our North America segment, and we gain further confidence.

Speaker Change: And one year ago, we began applying the framework to our Greater China segment.

Jean-Christophe Platon: As such, our European and international segment is the furthest along, and it has consistently driven profitable growth while reinvesting in brand building and innovation. The next stage of this segment will be increasing demand-generating investments to drive accelerated growth via new markets and new occasions. Our North America segment has been making continuous progress, and I am pleased to report the North America segment reported its full cluster of profitable growth in the second quarter.

Speaker Change: As such, our European and international segment is the furthest along, and it has been consistently driving profitable growth while reinvesting in brand building and innovation.

Jean-Christophe Platon: The next stage of the segment will be increasing demand-generating investments to drive access-hated goals via new markets and new occasions. Our North America segment has been making continued progress. I am happy to report the North America segment reporting its full concert of profitable goals in the second quarter. The segment will continue to focus on driving awareness, trial, and repeat purchases across all channels, whilst continuing to be disciplined on top. As you all know, our greatest China business has been existing very well. It's a school program. We are not just one year ago, but our second quarter is 23-year-old school.

Speaker Change: The next stage of this segment will be increasing demand-generating investments to drive accelerated growth via new markets and new occasions.

Speaker Change: Our North America segment has been making continued progress, and I am pleased to report the North America segment reported its full quarter of profitable growth in the second quarter.

Jean-Christophe Platon: This segment will continue to focus on driving awareness, trial, and repeat purchases across all channels, whilst continuing to be disciplined on cost. As you all know, our Greater China business has been executing very well on its important plan we announced just one year ago on our second quarter 2023 earnings call. After a year of focused execution, I am proud to announce the second metageneric is positive at just CDBDA for one month during the quarter.

Speaker Change: This segment will continue to focus on driving awareness, trial and repeat purchases across all channels, whilst continuing to be disciplined on costs.

Speaker Change: As you all know, our Greater China business has been executing very well on its important plan we announced just one year ago on our second quarter 2023 earnings call.

Jean-Christophe Platon: After a year of focused institutions, I have passed to announce the second-year-old generic hypothesis adjusted in the BDA for one month; they'll be the corporate. I think of one month. That one month is just one month. Basically, the clear sign, the segment is moving in the right direction. And as we move forward, these segments will be balancing growth and profitability as we continue to execute on the improvement plan.

Speaker Change: After a year of focused execution, I am proud to announce that Segno Generic is positive adjusted EPA for one month during the quarter.

Jean-Christophe Platon: I recognize that one month is just one month, but this is a clear sign the segment is moving in the right direction. And as we move forward, these segments will be balancing growth and profitability as we continue to execute on the improvement plan. Slide 8 is a reminder of the strategic pillars we are focused on in 2024. The first one is bringing the Oatly magic to more people.

Speaker Change: I recognize that one month is just one month, but this is a clear sign the segment is moving in the right direction.

Speaker Change: As we move forward, these segments will be balancing growth and profitability as we continue to execute on the improvement plan.

Jean-Christophe Platon: Like eight, it's a reminder of the strategic period we are focused on in 2024. The first one is bringing the open magic to more people. In Europe and international, we are engaging with new consumers in new occasions, while also making very good progress in our geological expansion strategy. In the US, we have increased our distribution compared to one year ago. And in terms of China, we have seen positive test results with China's largest copy chain, which is helping us expand our reach in a distinct manner. Our second pillar is to continue to work on the calibration of results across SGA and the supply chain.

Speaker Change: Slide 8 is a reminder of the strategic pillars we are focused on in 2024.

Speaker Change: The first one is bringing the Oatly magic to more people.

Jean-Christophe Platon: In Europe and internationally, we are engaging with new consumers on new occasions while also making very good progress in our geographical expansion strategy. In the U.S., we have increased our distribution compared to one year ago. And in Greater China, we have seen positive test results with China's largest copy chain, which is helping us expand our reach in a disciplined manner.

Speaker Change: In Europe and internationally, we are engaging with new consumers in new occasions, while also making very good progress in our geographical expansion strategy.

Speaker Change: In the U.S., we have increased our distribution compared to one year ago. And in Greater China, we have seen positive test results with China's largest copy chain, which is helping us expand our reach in a disciplined manner.

Jean-Christophe Platon: Our second pillar is to continue to work on the calibration of resources across SGMA and the supply chain. We remain on track with both our previously announced SG&A consulting program, as well as our previously announced exit from our manufacturing facilities in the US and the UK. And we are continuing to evaluate our options in our Asian supply chain. The final pillar we are focused on this year is execution of excellence. As I work with our teams across the globe, I am glad to see our culture maintaining the disruptive mindset that made Oatly a global phenomenon, while also being increasingly disciplined on execution. Having both at the same time within the same organization is rare, and therefore, I believe our culture is truly unique. Turning to slide 9, where I want to bring this feeling to life a bit more.

Speaker Change: Our second pillar is to continue to work on the calibration of resources across SGMA and the supply chain.

Jean-Christophe Platon: We remain on track with both our previously announced SGA concerted program, as well as our previously announced exits of our manufacturing facilities in the US and the UK. And we are continuing to evaluate our options in our Asian supply chain. The final pillar we are focused on this year is execution of excellence. As I work with those teams across the globe, I am glad to see our culture is maintaining the destructive mindset that may not be a global phenomenon, while also being increasingly disciplined on execution. I think both at the same time, within the same organization, is rare, and therefore, I believe our culture is truly unique.

Speaker Change: We remain on track with both our previously announced SG&A concepting program, as well as our previously announced exit of our manufacturing facilities in the US and the UK.

Speaker Change: And we are continuing to evaluate our options in our Asian supply chain.

Speaker Change: The final field we are focused on this year is execution of accidents.

Speaker Change: As I work with our teams across the globe, I am glad to see our culture is maintaining the disruptive mindset that made Oatly a global phenomenon, while also being increasingly disciplined on execution.

Speaker Change: Having both at the same time, within the same organization is rare, and therefore, I believe our culture is truly unique.

Jean-Christophe Platon: Turning to slide 9, where I want to build this pillar to life a bit more. Our work on the three strategic pillars is not necessarily discrete projects that fall neatly into one individual bucket. Our partnerships with EF Cross Cycling is a good example of how we are executing on these three strategic priorities all in one project. First, this partnership is clearly focused on bringing the ultimate magic to more people by increasing awareness of our minds. EF Cross Cycling is extremely focused on nutrition, and we are excited to partner with them as their official performance partner.

Speaker Change: Turning to slide 9, where I want to bring the speaker to life a bit more.

Jean-Christophe Platon: Our work on the three strategic pillars is not necessarily discrete projects that fall neatly into one individual bucket. Our partnership with EF Pro Cycling is a good example of how we are executing on these three strategic priorities all in one project. First, this partnership is clearly focused on bringing the Oatly magic to more people by increasing awareness of our brand. EF Pro Cycling is extremely focused on nutrition, and we are excited to partner with them as their official performance partner.

Speaker Change: Our work on these three strategic pillars are not necessarily discrete projects that fall neatly into one individual bucket.

Speaker Change: Our partnership with EF Pro-Cycling is a good example of how we are executing on these three strategic priorities all in one project.

Speaker Change: First, this partnership is clearly focused on bringing the Oatly magic to more people by increasing awareness of our brand.

Speaker Change: EF Pro Cycling is extremely focused on nutrition, and we are excited to partner with them as their official performance partner.

Jean-Christophe Platon: This partnership also demonstrates how we are continuing to be efficient with our results allocation to benefit all three operating segments. More specifically, let's reflect on the fact that EF Cross Cycling is a numerical team that just finished completing in the European race as a global group. Finally, our team's execution of this partnership has been fantastic so far, announcing it right at the Tour de France media company kicked off, and the F-Team is executing as well. Richard Carapras won the yellow jersey for one day early in the race and then had multiple achievements later on, which had helped draw significant amounts of attention to the team and to our F-Team.

Jean-Christophe Platon: This partnership also demonstrates how we are continuing to be efficient with our resource allocation to benefit all three operating segments. More specifically, let's reflect on the fact that ES Pro Cycling is an American team that just finished competing in a European race that has a global audience. Finally, our team's execution of this partnership has been fantastic so far, announcing it right as the Tour de France media frenzy kicked off. And we have seen his execution as well. Richard Carapaz wore the yellow jersey for one day early in the race and then had multiple achievements later on, which has helped draw a significant amount of attention to the team and to our brand.

Speaker Change: This partnership also demonstrates how we are continuing to be efficient with our resource allocation to benefit all three operating segments.

Speaker Change: More specifically, let's reflect on the fact that EF Pro Cycling is an American team that just finished competing in a European race that has a global audience.

Speaker Change: Finally, our team's execution of this partnership has been fantastic so far, announcing it right as the Tour de France media frenzy kicked off.

Speaker Change: And this team is executing as well. Richard Carapaz wore the yellow jersey for one day early in the race, and then had multiple achievements later on, which has helped draw a significant amount of attention to the team and to our brand.

Jean-Christophe Platon: Turning to slide seven, during the quarter, we started reclaiming our why and our reason for being. We know we have a unique brand voice that can gain a lot of attention, so we decided to pivot from using our brand voice in a slightly less self-indulgent way to lead the conversation about the necessary transformation of our food system, reconciling health for people and the planet. We run a campaign to urge European citizens to vote and to keep climate change in mind as they do so. At the same time, we engage with thousands of coffee customers and consumers, offering free oatmeal coffee to the many who want it.

Jean-Christophe Platon: During the quarter, we started reclaiming our wild and our reason for being. We know we have a unique brain voice that can gain a lot of attention, so we decided to pivot from using our brain voice in a slightly less self-indulgent way, but to lead the conversation of the necessary transformation of our food system, reconciling health for people and the planet. We had a campaign to urge European citizens to vote and to keep climate change in mind as a producer. At the same time, we engage with thousands of coffee customers and consumers, offering free, ultimate coffee to the many food workers.

Speaker Change: Turning to slide 7.

Speaker Change: During the quarter, we started reclaiming our why and our reason for being.

Speaker Change: We know we have a unique brand voice that can gain a lot of attention.

Speaker Change: So we decided to pivot from using our brand voice in a slightly less self-indulgent way, but to lead the conversation of the necessary transformation of our food system, reconciling health for people and the planet.

Speaker Change: We run a campaign to urge European citizens to vote and to keep climate change in mind as they do so.

Speaker Change: At the same time, we engage with thousands of coffee customers and consumers, offering free oatmeal coffee to the many who want it.

Jean-Christophe Platon: We know our unique tone of voice and attention, but we also know substance-generated relevance. So, as we move forward, our bond campaigns will keep the unique of the voice, and we will be putting them on substance relevance and demand generation so that we can drive forward our company's mission.

Daniel Ordonez: We know our unique tone of voice aims at attention, but we also know substance generates relevance. So, as we move forward, our BAM campaigns will keep the uniqueness of the voice and will be a good lead down on substance, relevance, and demand generation so that we can drive forward our company's mission. Before I turn the call over to Daniel, I want to turn to slide 11 and give you our priorities for the second half of the year.

Speaker Change: We know our unique tone of voice aims at attention, but we also know substance generates relevance.

Speaker Change: So, as we move forward, our BAUM campaigns will keep the unique of the voice, and we will be doubling down on substance, relevance, and demand generation so that we can drive forward our company's mission.

Jean-Christophe Platon: Before I turn the call over to Daniel, I want to turn to slide 11 and give you our priority for the second half of the year. The organization will be competing our work on the calibration of resources. We will continue to invent in demand generation to drive conversion and an acceleration of voice. As we invent, we will maintain cut facilities and ensure we are focused on high return investments. And finally, we will maintain now no star of driving the business towards structural, consistent, profitable voice.

Speaker Change: Before I turn the call over to Daniel, I want to turn to slide 11 and give you our priorities for the second half of the year.

Daniel Ordonez: The organization will be completing its work on the calibration of resources. We will continue to invest in demand generation to drive conversion and an acceleration of growth. As we invest, we will maintain cost discipline and ensure we are focused on high-return investments. And finally, we will maintain our north star of driving the business towards structural, consistent, profitable growth. With that, my dear Daniel, over to you.

Daniel Ordonez: The organization will be completing our work on the calibration of resources.

Daniel Ordonez: We will continue to invest in demand generation to drive conversion and an acceleration of growth.

Daniel Ordonez: As we invest, we will maintain cost discipline and ensure we are focused on high return investments.

Daniel Ordonez: And finally, we will maintain our north star of driving the business towards structural, consistent, profitable growth.

Daniel Ordonez: With that, my dear Daniel, over to you. Thank you, JC, and good morning, everyone. I'll begin my discussion on slide 13 with our largest operating segment that is Europe and International. This segment reported solid results in the quarter with constants, currency revenue growth of 7.5 percent, approximately in line with Quarter One. A justice EBITDA of 12.6 million was slightly below quarter one's level up to you to seasonality and timing of emotional events and investment. On a year-on-year basis, we were very much higher than last year's quarter two levels. On slide 14, you can see we're seeing broad-based strengths in the segment.

Daniel Ordonez: Thank you, JC, and good morning, everyone. I'll begin my discussion on slide 13 with our largest operating segment, that is, Europe and international. This segment reported solid results in the quarter with constant currency revenue growth of 7.5%, approximately in line with Quarter 1, adjusted EBITDA of $12.6 million was slightly below quarter one's level, largely due to seasonality and timing of promotional events and investments. However, on a year-on-year basis, we were much higher than last year's quarter two levels. On slide 14, you can see we're seeing broad-based strength in the segment. The retail side of the business grew 7%, and the food service side grew 9% in the quarter.

Daniel Ordonez: With that, my dear Daniel, over to you.

Daniel Ordonez: Thank you, JC, and good morning, everyone. I'll begin my discussion on slide 13 with our largest operating segment, that is Europe and international.

Daniel Ordonez: This segment reported solid results in the quarter with constant currency revenue growth of 7.5%, approximately in line with Q1.

Speaker Change: Adjusted EBITDA of $12.6 million was slightly below quarter one's level, largely due to seasonality and timing of promotional events and investments.

Speaker Change: On a year-on-year basis, we were way much higher than last year's quarter two levels.

Speaker Change: On slide 14, you can see we are seeing broad-based strengths in the segment.

Daniel Ordonez: The retail side of the business grew 7 percent, and the food service side grew 9 percent in the quarter. As we have discussed in the past, we believe there is significant opportunity to drive solid, robust growth in the food service channel. On the right hand side, you can see our established markets group volume by a solid 6% in the quarter. These are markets where we have operated for many years, and they continue to drive solid mid-single digit growth rates. The European markets where we have recently expanded drove a strong 24% volume growth in the quarter.

Speaker Change: The retail side of the business grew 7%.

Daniel Ordonez: As we have discussed in the past, we believe there is a significant opportunity to drive solid, robust growth in the food service chain. On the right-hand side, you can see our established markets grew in volume by a solid 6% in the quarter. These are markets where we have operated for many years, and they continue to drive solid mid-single-digit growth rates. The European market, which we have recently expanded, drove a strong 24% volume growth in the quarter.

Speaker Change: and the food service side grew 9% in the quarter. As we have discussed in the past, we believe there is significant opportunity to drive solid, robust growth in the food service channel.

Speaker Change: On the right-hand side, you can see our established markets grew volume by a solid 6% in the quarter. These are markets where we have operated for many years, and they continue to drive solid mid-single-digit growth rates.

Speaker Change: The European market, what we have recently expanded, drove a strong 24% volume growth in the quarter. So overall, we're executing very well.

Daniel Ordonez: So overall we are executing very well. Flight 15 shows the retail track channel data for some of our largest new European markets. You can clearly see here we are driving the entire category. For instance, in Spain, which is the second largest land-based beverage market in Europe, and in Belgium, which is the oldest and where the category was first created. In essence, only catalyzes growth once we enter a market. The same dynamics we experience when we enter markets like the UK or Germany in the past. I have said it in the past, and I will say it again and again.

Daniel Ordonez: So overall, we're executing very well. Slide 15 shows the Retail Track Channel data for some of our largest new European markets. You can clearly see here that we're driving the entire category. For instance, in Spain, which is the second largest plant-based beverage market in Europe, and in Belgium, which is the oldest and where the category was first created, we only catalyze growth once we enter a market. The same dynamics we experienced when we entered markets like the UK or Germany in the past. I have said it before, and I will say it again and again. There is a clear difference between the underlying trends of plant-based drinks versus oat milk and then versus Oatly.

Speaker Change: Slide 15 shows the retail track channel data for some of our largest new European markets.

Speaker Change: You can clearly see here we're driving the entire category. For instance, in Spain, which is the second largest plant-based beverage market in Europe , and in Belgium, which is the oldest and where the category was first created.

Speaker Change: In essence, only catalyzed growth once we enter a market. The same dynamics we experience when we enter markets like the UK or Germany in the past.

Daniel Ordonez: There is a clear difference between the underlying trends of plant-based drinks versus old milk and then versus old.

Speaker Change: I have said it in the past, and I will say it again and again. There is a clear difference between the underlying trends of plant-based drinks versus oat milk, and then versus Oatly.

Daniel Ordonez: Turning to slide 16. Update C said earlier we are refocusing our brand effort on substance and demand generation in a thoughtful and strategic manner. Here you can see how our Europe and international segment has been using our unique voice to drive brand awareness while pushing forward on our mission to transform the food system. So people do not have to choose between the health and the planet. In Spain, we are driving awareness and engagement and our genuine commitment to transparency via campaign idea that Brian won't let me say, but that you can read on the slide yourself.

Daniel Ordonez: Turning to slide 16. As JC said earlier, we are refocusing our brand efforts on substance and demand generation in a thoughtful and strategic manner. Here you can see how our Europe and international segment has been using our unique voice to drive brand awareness while pushing forward on our mission to transform the food system so people do not have to choose between their health and the planet. In Spain, we're driving awareness, engagement, and our genuine commitment to transparency via a campaign idea that Brian won't let me say, but that you can read on the slide yourself. As Jaycee mentioned earlier, across Europe, we ran a Vote V-O-A-T campaign during the recent elections.

Speaker Change: Turning to slide 16.

Speaker Change: As Jaycee said earlier, we are refocusing our brand efforts on substance and demand generation in a thoughtful and strategic manner.

Jaycee: Here you can see how our Europe and international segment has been using our unique voice to drive brand awareness while pushing forward on our mission to transform the food system so people do not have to choose between their health and the planet.

Jaycee: In Spain, we're driving awareness, engagement, and our genuine commitment to transparency via a campaign idea that Brian won't let me say, but that you can read on the slide yourself.

Daniel Ordonez: I just mentioned earlier across Europe we are around a vote V O A T campaign during the recent elections. I will recently launch in Mexico City where we are excited to bring the open magic to. Slide 17 shows we are pairing these awareness-driving campaigns with on-the-ground cultural experience events. A proven madness for young generations that love the old brands and can experience it via surprises, new collaborations, partnerships, and crossovers with other categories. For example, for five weeks this summer we have a pop-up store in Pahile, Mahé. We are collaborating with local culturally relevant Parisian brands.

Jaycee: As J.C. mentioned earlier, across Europe , we ran a Vote V-O-A-T campaign during the recent elections. And we recently launched in Mexico City, where we are excited to bring the Open Magic 2.

Daniel Ordonez: And we recently launched in Mexico City, where we are excited to bring the Open Magic 2. Slide 17 shows how we are pairing these awareness-driving campaigns with on-the-ground cultural experiences events, a proven magnet for young generations that love the Oatly brand and can experience it via surprises, new collaborations, partnerships, and crossovers with other categories. For example, for five weeks this summer, we had a pop-up store in Paris-les-Mara

Speaker Change: Slide 17 shows we are pairing these awareness driving campaigns with on-the-ground cultural experience events.

Speaker Change: A proven magnet for young generations that love the Oatly brand and can experience it via surprises, new collaborations, partnerships, and crossovers with other categories. For example, for five weeks this summer, we have a pop-up store in Paris-les-Marais.

Daniel Ordonez: We are collaborating with local culturally relevant Parisian brands. This involves our two most amazing product experiences, our soft-serve, and plenty of coffee with Oatly Barista. Likewise, in Shoreditch, London, we opened the Paradise Arches, our very own pop-up club in collaboration with Malibu, where celebrities and consumers can enjoy our Pia Otrada, the perfect summer treat of a Malibu-flavored drink or soft-serve.

Speaker Change: We are collaborating with local culturally relevant Parisian brands.

Daniel Ordonez: These involve our two most amazing product experiences: our subsurface and plenty of coffee with all the very stuff. Likewise, in short, it's London we open the paradise arches, a very own pop-up club in collaboration with Malibu where celebrities and consumers can enjoy our pinya opada, the perfect summer treats of a Malibu flavor drink or so search. I can go on and on, city by city across Europe, bringing our unique brand to more people in the most surprising and cultural and relevant world. Then, as you can see on slide 18, our brand uniqueness does not stop there selectively, but increasingly we activate in store in the same provocative way, never transactional, always surprising.

Speaker Change: These involve our two most amazing product experiences, our soft serve and plenty of coffee with Oatly Barista.

Speaker Change: Likewise, in Shoreditch, London, we opened the Paradise Arches, our very own pop-up club in collaboration with Malibu, where celebrities and consumers can enjoy our Piña Otrada, the perfect summer treat of a Malibu-flavored drink or soft-serve.

Daniel Ordonez: And I can go on and on, city by city across Europe, bringing our unique brand to more people in the most surprising and culturally relevant way. But, as you can see on slide 18, our brand uniqueness does not stop there. Selectively, but increasingly, we activate in-store in the same provocative way. Never transactional, always surprising. This slide shows just one recent example from Hamburg, where we built seven great pyramids in one of Germany's largest retailers. They have become true tourist attractions with a hop-on, hop-off, tour bus, postcards, and t-shirts.

Speaker Change: And I can go on and on, city by city across Europe , bringing our unique brand to more people in the most surprising and culturally relevant way.

Speaker Change: Then, as you can see on slide 18, our brand uniqueness does not stop there. Selectively, but increasingly, we activate in-store in the same provocative way. Never transactional, always surprising.

Daniel Ordonez: This slide shows just one recent example from Hamburg where we build seven great pyramids in one of Germany's largest retailers. They become true tourist attractions with a hop-on, hop-off, two bus, postcards and t-shirts and usual surprising in market executions with this event that draw a significant amount of consumer bus. You should expect more of this type of thoughtful, disciplined brand activity in each of our segments as we move forward.

Speaker Change: This slide shows just one recent example from Hamburg, where we built seven great pyramids in one of Germany's largest retailers.

Speaker Change: They become true tourist attractions, with a hop-on, hop-off, tour bus, postcards, and t-shirts. And you'll show surprising in-market executions with these events that drove a significant amount of consumer buzz.

Daniel Ordonez: And you'll show surprising in-market executions with this event that drove a significant amount of consumer buzz. You should expect more of this type of thoughtful, disciplined brand activity in each of our segments as we move forward. Turning to our North America segment on slide 19, this segment's quarter two results are a direct result of disciplined execution throughout the entire organization and staying true to our North Star of profitable growth. We reported nearly 10% revenue growth, and I'm very happy to report the North America segment was profitable in the quarter.

Speaker Change: You should expect more of this type of thoughtful, disciplined brand activity in each of our segments as we move forward.

Daniel Ordonez: Slide 20 focuses on our retail performance, which is just over half of the segment's net sales. The strong 13% growth in measured channels has led to market share gains in oat milk of 370 basis points year on year. Our products are showing up well on shelves, both chilled and ambient, and our dollar velocities per point of distribution remain nearly three times higher than our nearest competitor. On slide 21, you can see that segment food service sales grew nearly 9% in the quarter.

Daniel Ordonez: Turning to our North America segment on slide 19, these segments, what the two results are a direct result of disciplined execution throughout the entire organization and staying true to our North Star of profitable growth. We reported nearly 10% revenue growth, and I'm very happy to report the segment was profitable in the quarter. Slide 20 focuses on our retail performance, which is just over half of the segment's net sales. The strong 13% growth in measure channels has led to market share gains in oatmeal of 370 basis points year on year. Our products are showing up well on shelves, both chilled and ambient, and our dollar velocities per point of distribution remain nearly three times higher than our nearest competitor.

Speaker Change: Turning to our North America segment on slide 19. This segment's quarter two results are a direct result of disciplined execution throughout the entire organization and staying true to our North Star of profitable growth.

Speaker Change: We reported nearly 10% revenue growth, and I'm very happy to report the segment was profitable in the quarter.

Speaker Change: Slide 20 focuses on our retail performance, which is just over half of the segment's net sales.

Speaker Change: The strong 13% growth in measured channels has led to market share gains in oat milk of 370 basis points year-on-year.

Speaker Change: Our products are showing up well on shelves, both chilled and ambient, and our dollar velocities per point of distribution remain nearly three times higher than our nearest competitor.

Daniel Ordonez: On slide 21, you can see the segment's food service sales grew nearly 9% in the quarter. Our strategy of nurturing our existing business while expanding into a higher growth, higher margin areas of the food service channel is clearly working.

Speaker Change: On slide 21, you can see the segment food service sales grew nearly 9% in the quarter. Our strategy of nurturing our existing business while expanding into the higher growth, higher margin areas of the food service channel is clearly working.

Daniel Ordonez: Our strategy of nurturing our existing business while expanding into the higher growth, higher margin areas of the food service channel is clearly working. Turning now to the Greater China segment on slide 22, volume growth has accelerated to over 26% in the quarter, which translates into 20% growth when compared to two years ago.

Daniel Ordonez: Turning now to the greater China segment on slide 22, volume rolls have accelerated to over 26% in the quarter, which translates into 20% growth when compared to two years ago. These strong growth was largely aided by the successful limited time offer test with China's largest coffee chain I mentioned on last quarter score. To give you perspective of these, those are a potential impact. These tests have already driven them to be the segment's second largest customer base on a year-to-date net sales. Over the coming months, we will be executing another test with them with a broader menu offering.

Speaker Change: Turning now to the Greater China segment on slide 22.

Speaker Change: Volume growth has accelerated to over 26% in the quarter, which translates into 20% growth when compared to two years ago.

Daniel Ordonez: This strong growth was largely aided by the successful limited-time offer test with China's largest coffee chain, which I mentioned on last quarter's call. To give you perspective on this, their size and potential impact, this test has already driven them to be the segment's second largest customer base on year-to-date net sales. In the coming months, we will be executing another test with them with a broader menu offering.

Speaker Change: This strong growth was largely aided by the successful limited-time offer test with China's largest coffee chain I mentioned on last quarter's call.

Speaker Change: To give you perspective of this, their size and potential impact, this test has already driven them to be the segment's second-largest customer base on a year-to-date net sales.

Speaker Change: Over the coming months, we will be executing another test with them with a broader menu offering.

Daniel Ordonez: Because these customers focus on the lower price value tier, there is an impact to this segment's price mix line in the sales bridge. We are comfortable with this because of the clear positive margin impact these volume drives through fixed cost absorption, as well as the visible momentum they generate.

Marie-Josée Davy: Because this customer focuses on the lower-priced value tier, there is an impact on this segment's price mix line in the sales breach. However, we are comfortable with this because of the clear positive margin impact this volume drives through fixed cost absorption, as well as the visible momentum it generates. Let's discuss this segment's profitability on slide 23. The segment adjusted EBITDA was just below breakeven in the quarter, and importantly, though, it did report positive adjusted EBITDA for one month during the quarter.

Speaker Change: Because this customer focuses on the lower price value tier, there is an impact to this segment's price mix line in the sales bridge.

Speaker Change: We are comfortable with this because of the clear positive margin impact this volume drives through fixed cost absorption as well as the visible momentum it generates.

Daniel Ordonez: Let's discuss the segment's profitability on slide 23. The segment's adjusted EBITDA was just below breakeven in the quarter, and importantly, though it did report positive adjusted EBITDA for one month during the quarter. The right side of the page shows the trend in the segments cost of good per liter, the 18% reduction quarter of a quarter, which is largely deriving by the higher volume leading to involved absorption. Growth margin for the quarter was 29.2%, which is 1,000 basis points higher than a year ago. Adjusted the beta was a loss of 11,000, which is 21.5 million improvement compared to last year's autumn quarter.

Speaker Change: Let's discuss this segment's profitability on slide 23. The segment's adjusted EBITDA was just below breakeven in the quarter, and importantly, though, it did report positive adjusted EBITDA for one month during the quarter.

Marie-Josée Davy: The right side of the page shows the trend in the segment's cost of goods per liter, the 18% reduction quarter over quarter, which is largely driven by the higher volume leading to in-growth absorption. So while we remain cautious and continue to monitor the consumer macro environment in the region, we're pleased with the progress so far in our Greater China segment. I will now turn the call over to MJ, Marie-Josée David.

Speaker Change: The right side of the page shows the trend in the segment's cost of goods per litre, the 18% reduction quarter over quarter, which is largely driven by the higher volume leading to in-road absorption.

Speaker Change: So while we remain cautious and continue to monitor the consumer macro environment in the region, we're pleased with the progress so far in our Greater China segment.

Speaker Change: I will now turn the call over to MJ, Marie-Josée David.

Marie-Josée Davy: Thank you, Daniel, and good morning, everyone. Slide 25 shows an overview of the quarterly P&L. We reported 3.2% year-over-year revenue growth and constant currency revenue growth of 3.9%. Gross margin for the quarter was 49.2%, which is 1,000 basis points higher than a year ago. Adjusted EBITDA was a loss of $11 million, which is a $41.5 million improvement compared to last year's second quarter.

Marie-Josée David: Thank you, Daniel, and good morning, everyone. Slide 25 shows an overview of the quarterly P&L. We reported 3.2% year-over-year revenue growth and constant currency revenue growth of 3.9%.

Marie-Josée David: Gross margin for the quarter was 39.2%, which is 1,000 basis points higher than a year ago. Adjusted EBITDA was a loss of $11 million, which is $41.5 million improvement compared to last year's second quarter.

Daniel Ordonez: Over, we had the selling performance in the quarter and the first half.

Marie-Josée Davy: Overall, we had a solid performance in the quarter and the first half. Slide 26 shows the bridging items of our Total Company Quarterly Revenue Book; volume grew 9.6%, and price mix was a 5.7% headwind for a 3.9% constant currency revenue growth. Current exchange was a headwind of 0.7%, resulting in a 3.2% total revenue growth for the quarter. Slide 27 shows the revenue bridge by segment. JC and Daniel's presentations outlined everything we are doing in each region to drive solid growth.

Marie-Josée David: Overall, we had a solid performance in the quarter and the first half.

Daniel Ordonez: Slide 26 shows the bridging items of our total company's quarter-year revenue growth. Volume grew 9.6%, and price mix was a 5.7% headwind for a 3.9% constant currency revenue growth. Currently, exchange was a headwind of 0.7%. Resulting in a 3.2% total revenue growth for the quarter. Slide 27 shows the revenue bridge by segment. GT and Daniel's presentation applying everything we are doing in each region to drive solid growth. And the overall takeaway of this life is that each region drove solid volume growth as our strategic initiatives and growth plans continue to work. Europe and international continued to report to the growth with 7.5% constant currency revenue growth led by 5.7% volume growth.

Marie-Josée David: Slide 26 shows the bridging items of our Total Company Quarterly Revenue Broch.

Marie-Josée David: Volume grew 9.6% and price-mix was a 5.7% headwind for a 3.9% constant current year revenue growth.

Marie-Josée David: Current exchange was a headwind of 0.7%, resulting in a 3.2% total revenue growth for the quarter.

Marie-Josée David: Slide 27 shows the revenue bridge by segment.

Marie-Josée David: JT and Daniel's presentations outlined everything we are doing in each region to drive food growth.

Marie-Josée Davy: And the other takeaway of this slide is that each region drove solid volume growth as our strategic initiatives and growth plans continue to work. Europe and International continue to report fluid growth with 7.5% constant currency revenue growth led by 5.7% volume growth. North America's revenue growth of 9.7% was driven mainly by a strong 8.3% volume growth.

Speaker Change: And the overall takeaway of this slide is that each region drove solid volume growth as our strategic initiatives and growth plans continue to work.

Speaker Change: Europe and international continue to report fluid growth with 7.5% constant currency revenue growth led by 5.7% volume growth.

Daniel Ordonez: North America's revenue growth of 99% was driven mainly by the strong 8.3% volume growth.

Speaker Change: North America's revenue growth of 9.7% was driven mainly by the strong 8.3% volume growth.

Daniel Ordonez: Breaker's China, 15.9% constant currency decline was driven largely by the actions we have taken as part of the segment's strategic reset plan we announced on last year's second quarter earnings fall. The sales headwind in the quarter from the strategic reset were partially upset by sales to a new customer that is focused on the lower price value tier. This customer mix has a clear impact on the segment bridge, with a large volume increase and an impact on price mix. Since we will start to anniversary the reset next quarter, we expect water China to report a more favorable constant currency growth next quarter.

Marie-Josée Davy: Breakers China's 15.9% constant currency decline was driven largely by the actions we have taken as part of the segment strategic reset plan we announced in last year's second quarter earnings report. The sales headwinds in the quarter from the strategic retreat were partially offset by sales to a new customer that is focused on the lower-priced value tier. This customer mix has a clear impact on the segment bridge with a large volume increase and an impact on price mix.

Speaker Change: Breakers China, 15.9% constant currency decline was driven largely by the actions we have taken as part of the segment strategic recess plan we announced on last year's second quarter earnings call.

Speaker Change: The sales headwinds in the quarter from the strategic recess were partially offset by sales to a new customer that is focused on the lower-priced value tier.

Speaker Change: This customer mix has a clear impact on the segment bridge with a large volume increase and an impact on price mix.

Marie-Josée Davy: Since we will start to anniversary the reset next quarter, we expect Greater China to report more favorable constant currency growth next quarter. Additionally, since we are running another LTO with this large customer, we expect the bridging lines to continue to be impacted at least in Q3.

Speaker Change: Since we will start to anniversary the reset next quarter, we expect Greater China to report a more favorable constant currency growth next quarter.

Daniel Ordonez: Since we are running another NGO with this large customer, we expect the bridging lines to continue to be impacted at least into free.

Speaker Change: Since we are running another LTO with this large customer, we expect the bridging lines to continue to be impacted at least in Q3.

Daniel Ordonez: Slide 28 shows the drivers of our 1,000 baby's pointier reviewer, Gross Martin Expansion. The biggest item is a 700 baby's point increase driven by absorption and supply chain improvement. The 9.6 percent volume growth has dried it and sees our team continue the education to remove income and inefficiencies. Our next pricing and project mix improves marketing by 240 baby's points. This was largely driven by the actions we take in burning worker China to eliminate low-marking products. For an exchange, increased our marketing by 60 baby's points and inflation was worth a note to market.

Marie-Josée Davy: Slide 28 shows the drivers of our 1,000-basis-point-year-over-year gross margin expansion. The biggest item is a 700-basis point increase driven by absorption and supply chain improvements. The 9.6% volume growth has driven it, as has our team's continued dedication to removing costs and inefficiencies. Our net pricing and product mix improved margins by 240 basis points. This was largely driven by the actions we took in Greater China to eliminate low-margin products. Foreign exchange increased our market by 60 business points, and inflation was roughly neutral to the market.

Speaker Change: Slide 28 shows the drivers of our 1,000 basis points year-over-year gross margin expansion.

Speaker Change: The biggest item is a 700 basis point increase driven by absorption and supply chain improvements.

Speaker Change: The 9.6% volume growth has driven this, as did our team's continued dedication to removing costs and inefficiencies.

Speaker Change: Our net pricing and product mix improved margins by 240 basis points. This was largely driven by the actions we've taken done in broader China to eliminate low-margin products.

Speaker Change: Foreign exchange increased our margin by 60 basis points and inflation was roughly neutral to margin.

Daniel Ordonez: Slide 49 shows the year-over-year improvement in our adjusted data was driven by a roughly equal balance between gross profit and SGN8. As we move forward, we expect gross profit to be the main driver of project improvement as the benefits of our SGN8 savings program eventually roll out, and we invest in demand generation.

Marie-Josée Davy: Slide 29 shows that the year-over-year improvement in our adjusted EBITDA was driven by a roughly equal balance between gross profit and SG&A. As we move forward, we expect gross profit to be the main driver of profit improvement as the benefits of our economic savings program eventually roll off, and we invest in demand generation. Slide 13 shows our adjusted data by segment. Each segment continues to report a significant improvement compared to the prior year, while corporate was approximately flat, as it contains the expenses related to some of the global initiatives that benefit all segments, such as the EF Processing Partnership Jean-Christophe mentioned. For the third quarter in a row, the sum total of the adjusted EBITDA of the three regions was positive.

Speaker Change: Slide 29 shows the year-over-year improvement in our adjusted EBITDA was driven by a roughly equal balance between gross profit and SG&A.

Speaker Change: As we move forward, we expect gross profit to be the main driver of profit improvement as the benefits of our SG&A savings program eventually roll off and we invest in demand generation.

Daniel Ordonez: Slide 30 shows our adjusted data by segments. Each segment continues to report significant improvement compared to the prior year, while corporate was approximately flat, as it contains the expenses related to some of the global initiatives that benefit all segments, such as the ESF for such important shifts, John Fistoff mentioned. For the first quarter in the room, the sum total of the adjusted data of the three regions was positive. On top of that, I am pleased that our North American segment supported its first quarter of positive adjusted data, and the worker China segment was shed below work even.

Speaker Change: Slide 30 shows our adjusted data by segment.

Speaker Change: Each segment continues to report a significant improvement compared to the prior year while corporate was approximately flat as it contains the expenses related to some of the global initiatives that benefit all segments.

Speaker Change: such as the EF Processing Partnership Jean-Christophe mentioned.

Speaker Change: For the third quarter in a row, the sum total of the adjusted EBITDA of the three regions was positive.

Marie-Josée Davy: On top of that, I am pleased our North American segment reported its first quarter of positive adjusted data, and the Western China segment was below break-even. It continues to be clear that strategic actions have been taking or driving concrete results. Turning to our balance sheet and cash flow on slide 31, the biggest takeaways are that our cash flow remains on track with our plans. We remain fully funded, and our liquidity remains strong at $345 million. The chart on the right is our quarterly cash flow bridge. In the quarter, our total cash balance decreased by $66 million compared to Q1.

Speaker Change: On top of that, I am pleased our North American segment reported its first quarter of qualitative adjusted data. And the Western China segment watched it below break even.

Daniel Ordonez: It continues to be clear that strategic actions have been taking our driving concrete results.

Speaker Change: It continues to be clear that strategic actions have been taking or driving concrete results.

Maria Jose W.: Turning to our balance sheet and cash flow on slide 31, the biggest takeaway is that our cash flow remains on track with our plans. We remain fully funded, and our liquidity remains strong at 345 million. The track on the right is our quarterly cash flow bridge. In the quarter, our total cash balance decreased by 66 million compared to Q1. The record from that quarter, I said the cash impact from exiting our manufacturing in the UK and the US will hit in different parts of the cash flow statements, with some hitting free cash flow and some hitting elsewhere.

Speaker Change: Turning to our balance sheet and cash flow on slide 31.

Speaker Change: The biggest takeaways are that our cash flow remains on track with our plans, we remain fully funded, and our liquidity remains strong at $345 million.

Speaker Change: The chart on the right is our quarterly cash flow bridge. In the quarter, our total cash balance decreased by $66 million compared to Q1.

Marie-Josée Davy: Recall from last quarter, I said the cash impact from exiting our manufacturing in the UK and US will hit different parts of the cash flow statement, with some hitting free cash flow and some hitting elsewhere. In Q2, we had a net cash impact of $46 million related to this plant exit, with $34 million flowing through free cash flow. Year-to-date, we are at a net cash outflow of $13 million, and we remain on track for the exit to have no more than a $20 million total cash outflow.

Speaker Change: Recall from last quarter, I said the cash impact from exiting our manufacturing in the UK and US will hit in different parts of the cash flow statement, with some hitting free cash flow and some hitting elsewhere.

Maria Jose W.: In Q2, we had a net cash impact of 26 million related to this plan exists with 34 million flowing flow for cash flow. Your today, we are at the net cash outflow of 13 million, and we remain on track for the exits to have more than 20 million cash outflow. As I have said previously, improving our schedule is a priority for me, and our organization is focused on it.

Speaker Change: In Q2, we had a net cash impact of $46 million related to this plant exit with $24 million flowing through free cash flow.

Speaker Change: Year-to-date, we are at a net cash outflow of $13 million and we remain on track for the exit to have no more than a $20 million total cash outflow.

Marie-Josée Davy: As I have said previously, improving our cash flow is a priority for me, and our organization is focused on it. Slide 32 shows our updated 2024 guidance. Now that we have completed the first half of the year and slightly exceeded our internal expectations, we are increasing our guidance for our P&L metrics and lowering our guidance for CatechSNP. We expect constant currency growth in the range of 6% to 10%, and we continue to expect foreign exchange to have a minimum impact. We continue to expect the second half constant currency growth rate to be higher than the first half.

Speaker Change: As I have said previously, improving our cash flow is a priority for me and our organization is focused on it.

Maria Jose W.: Slide 32 shows our updated 24 guidance. Now that we have completed the first half of the year and slightly exceed our internal expectations, we are increasing our guidance for our PMM metrics and lowering our guidance for CAPEX needs. We expect constant currency growth in the range of 6 to 10 percent, and we continue to expect foreign exchange to have a minimum impact. We continue to expect the second half constant currency growth rate to be stronger than the first half. As a reminder, starting in the first quarter, our Greater China segment, we start to anniversary the strategic reset.

Speaker Change: Slide 32 shows our updated 2024 guidance.

Speaker Change: Now that we have completed the first half of the year and slightly exceeded our internal expectations, we are increasing our guidance for our P&L metrics and lowering our guidance for CAPEX needs.

Speaker Change: We expect constant currency growth in the range of 6 to 10% and we continue to expect foreign exchange to have a minimum impact.

Speaker Change: We continue to expect the second half constant currency growth rate to be stronger than the first half.

Marie-Josée Davy: As a reminder, starting in the third quarter, our Greater China Segment will start to anniversary the Strategic Reset. We expect this comparison to benefit the segments in the over-year growth rate in the second half. Also, as a reminder, in the fourth quarter, the North American segment will anniversary the large retail distribution gains it saw from the shelf reset, which we expect to impact segment growth in the fourth quarter. I just said EBITDA.

Speaker Change: As a reminder, starting in the first quarter, our Greater China segment will start to anniversary the strategic reset.

Maria Jose W.: We expect this comparison to benefit the segments in the year-over-year growth rates in the second half. Also, as a reminder, in the fourth quarter, the North America segment will anniversary the large retail distribution gains it shows from the shared reset, which we expect to impact the segment growth in the fourth quarter.

Maria Jose W.: So I just said a bit now, we expect to report a lot of between 35 million and 15 million in 2024. We have children to take a portion of our first half-procate outperformance and reinvest into branding activities, especially in our Europe and international segments.

Marie-Josée Davy: We expect to report a loss of between $35 million and $15 million in 2024. We have chosen to take a portion of our first-half profit outperformance and reinvest it in branding activities, especially in our Europe and international segments. Finally, we expect CapEx to be below $17 million for 2024, which is $5 million lower than previously expected.

Maria Jose W.: Finally, we expect CAPEX to be below 17 million for 2024, which is 5 million lower than the previously expected.

Speaker: These concludes our preferred remarks.

Operator: This concludes our preferred remarks. Operator, we are now prepared to take questions. We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone.

Operator: Operator, we are now prepared to take questions.

Operator: We will now begin the question and answer session. To ask a question, you may press star, then one on your touchdown phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two.

Operator: If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been answered and you would like to withdraw your question, please press star then 2. Our first question comes from Ken Goldman with J.P. Morgan. Please go ahead. Hi, thank you. I wanted to ask a little bit about the pace of pricing for the rest of the year. Obviously, there was a big deceleration in China in the second quarter.

Operator: I know you had some comments about China in the back half of the year. Unfortunately, I don't know if I had a tough connection or it was a little tough to hear, but if you could just repeat what you said about China's back half growth and kind of potentially weave thoughts about pricing in that segment and really around the world, that would be helpful. Okay, how are you doing, Ken? It's Daniel here.

Ken Goldman: Our first question comes from Ken Goldman with JP Morgan. Please go ahead. Hi, thank you. I wanted to ask a little bit about the cadence of pricing for the rest of the year. Obviously, there was a big deceleration in China in the second quarter. I know you had some comments about China in the back half of the year. Unfortunately, I don't know if I had a tough connection or if it was a little tough to hear.

Ken Goldman: But if you could just repeat what you said about China's back half growth and potentially we've talked about pricing in that segment and really around the world, that would be helpful. Thank you.

Daniel Ordonez: Okay. How are you doing, Ken? Is Daniel here?

Daniel Ordonez: I will start by addressing China in particular, because your question is the most specific, and then I'll try to give you a color of the overall outlook on pricing, but perhaps in general, right? So, in China, we've made solid progress during the quarter, knowing that the quarter two year-on-year net revenue growth does not fully reflect the progress because it's still impacted by the strategic resets we've executed over the past year. One area in which we made very solid progress this quarter, Ken, is the addition of a new, very important customer that operates in the growing and important mid-price tier sector.

Daniel Ordonez: I will start by addressing China in particular when your question is the most specific. And then I'll try to give you a color of the overall outlook, comprising but perhaps in general, right? So in China, we've made solid progress during the quarter, knowing that the quarter two year-on-year net revenue growth does not fully reflect the progress. Because it's still impacted by the strategic research we've executed over the past year. here.

Speaker Change: China in particular, what your question is the most specific and then I'll try to give you a color of the overall outlook on pricing, but perhaps in general right. So in in China, We've made solid progress during the quarter.

Speaker Change: Knowing that the quarter to year on year net revenue growth does not fully reflect the progress because it is still impacted by the strategic resets we've executed over the past year.

Daniel Ordonez: One area in which we made the solid progress this quarter can is the added addition of a new very important customer that operates in the growing and important mid-price year segment. So, as we said in the prepared remarks, we are not concerned about that, and this overall value creation from the SGNA reset, the higher volume, and stronger absorption can be seen in the overall company margin performance and the segments EBDA reported figures. So, as we move forward again in China, we expect to solidify this quarter to performance held by a more favorable base as we left the last year's reset.

Speaker Change: One area in which we made very solid progress this quarter Ken.

Ken: Ken ease.

Ken: The added addition of a new very important customer that operates in the growing unimportant.

Ken: <unk> tier segment.

Daniel Ordonez: So, as we said in the prepared remarks, we are not concerned about that, and this overall value creation from the SG&A receptor, the higher volume, and stronger absorption can be seen in the overall company margin performance and the segment EBITDA reported figure. So, as we move forward again in China, we expect to solidify this quarter 2 performance held by a more favorable base as we left the last year's reset. So, it's all the price mix and the effect of the reset overall.

Ken: So what we said in the prepared remarks, we are not concerned about that.

And this overall value creation from the SG&A reset the higher volume and stronger absorption can be seen in the overall company margin performance in the segments EBITDA reported figures. So as we move forward again in China, we expect to solidify this quarter two performance helped.

Ken: By a more favorable base as we lap last year's reset so we sold the price mix and the effect of the reset overall then when it comes to general pricing assumptions.

Daniel Ordonez: So it's all the price mix and the effect of the reset overall.

Daniel Ordonez: Then, when it comes to general pricing assumptions, can in terms of outlook in Europe, expect consistent year-on-year solid performance across the PNL lines. And in North America, we expect consistent performance and its light improvements, driven by more favorable overall base and less headwinds thanks to the new terms agreed with that important customer input service with mentioned before. So, as you can see, I'm not addressing specifically pricing, but you can see the different mix, volume growth effects, and the overall equation. Okay, and hope that's okay. That's helpful. Thank you.

Daniel Ordonez: Then, when it comes to general pricing assumptions, again, in terms of outlook in Europe, expect consistent year-on-year solid performance across the P&L lines. And in North America, we expect consistent performance and a slight improvement driven by a more favorable overall base and fewer headwinds thanks to the new terms agreed with that important customer in food service we've mentioned before. So, as you can see, I'm not addressing pricing specifically, but you can see the different mix volume growth effects and the overall equation again and I hope that's okay. That's helpful.

Ken: And in terms of outlook in Europe expect consistent year on year solid performance across the P&L lines.

Ken: And in North America, we expect consistent performance and it's like a <unk>.

Proven and driven by more favorable overall base and less headwinds. Thanks to the new terms agreed with that important customer in foodservice.

Speaker Change: We've mentioned before so as you can see and not addressing specifically pricing, but you can see the different mix volume growth effects on the overall equation, Okay and hope that's okay.

Speaker Change: That's helpful. Thank you and just a follow up if I may.

Jean-Christophe Platon: Thank you. And just a follow-up question, if I may. You know, as you think about the ranges of your top and bottom line guidance, are there any particular risks or upside scenarios that we should think about that might be the most important, just as you were kind of crafting the updated guidance? Any particular underlying factors we should think about that might lead to the higher or lower end. Thanks, Ken, for the follow-up question. JC is speaking.

Ken Goldman: And just follow up if I may.

Jean-Christophe Platon: As you think about the ranges of your top and bottom line guidance, are there any particular risks or upside scenarios that we should think of that might be the most important, just as you were kind of crafting the updated guidance, and any particular underlying factors we should think about that might lead to the higher or lower end. Thanks, Ken, for the follow-up question. JC speaking. First, I think it's important to know that we are pleased with all performance in the first half of the year. And we have also formed our internal expectations, specifically on the top line.

Speaker Change: Yeah as you think about the ranges of your top and bottom line.

Speaker Change: And are there any particular.

Speaker Change: Risks or upside scenarios that we should think of that might be the most important just as you were kind of correcting that.

Speaker Change: David guidance in any particular underlying factors, we should think about that might lead to that.

Speaker Change: At the lower end.

Speaker Change: Thanks, Ken for the follow up question JP speaking.

Jean-Christophe Platon: First, I think it's important to know that we are pleased with our performance in the first half of the year, and we have outperformed our internal expectations. Specifically on the top line, as we said, we have delivered the expected gains in distribution in both new and existing markets. We've made progress on selling our new products to customers, and we've made progress as well driving trials with consumers. On the bottom line, we've just shared with you the progress we have made, both on the supply chain recalibration as well as SG&A recalibration. So the fact that we are seeing our actions, both on resource calibration and demand generation, deliver the expected results has led us to update our guidance.

Speaker Change: First I think it's important to note that we are pleased with our performance in the first half for the year and we have outperformed our internal expectations.

JP: Specifically on the top line as we said we have delivered the expected gains in distribution in both new and existing markets with main projects from selling new products to customer and we made progress as well driving trial with consumers on the bottom line.

Jean-Christophe Platon: As we said, we have delivered the expected gains in distribution in both new and existing markets. We've made progress on selling in our new products to customer, and we made progress as well, driving trial with consumers. On the bottom line, we've just shared with you the progress we have made both on the supply chain recalibration as well as FGNA recalibration. So the fact that we are seeing our actions both on results calibration and demand generation deliver the expected results has led us to update our guidance. Now double-clicking on your question, how have we calibrated our new guidance range?

JP: Should we view the progress we have made both on the supply chain, a recalibration as well as SG&A recalibration. So the fact that we are seeing our actions both from reduced calibration and demand generation delivered the expected results.

To update our guidance now.

Jean-Christophe Platon: Now, double-clicking on your question, how have we calibrated our new guidance trend? Since we have been seeing good traction in many of our demand-generating activities, we've decided to take a portion of our first half performance and reinvest it into additional demand-driving investments to help further accelerate growth in the second half and going into 2025. As a consequence, the unfavorable ends of our EBITDA range now assume that these investments would not bring the full return we saw in H1. The next question comes from Michael Lavery with Piper Sandler. Please go ahead.

Speaker Change: Now double click to your question how have recalibrated, our new guidance range.

Jean-Christophe Platon: Since we have been seeing good traction in many of our demand generating activities, we've decided to take a portion of our first health health performance and reinvest it into additional demand driving investments to help further accelerate the goals in the second half and going into 2025. As a consequence, the unfavorable ends of our immediate range now attune that this is when these investments would not bring the full return recalibration in H1. Thank you.

Speaker Change: Since we have been seeing good traction in many of our demand generating activities.

Speaker Change: Decided to take propulsion of all first half outperformance and reinvested into additional demand driving investments to help further accelerate the growth in the second half and going into 2025.

Rick: As a consequence, the unfavorable end of our EBITDA range mellow assume that this is Rick.

Speaker Change: These investments would not bring the pool retail retail in each one.

Kim: Thank you Kim.

Ken Goldman: again.

Michael Lavery: The next question comes from Michael Lavery with Piper Sandler. Please go ahead. Thank you.

Speaker Change: The next question comes from Michael Lavery with Piper Sandler. Please go ahead.

Kim: Yeah.

Speaker Change: Thank you.

Jean-Christophe Platon: Thank you. I just was wondering if you could unpack the ibada thinking a little bit and maybe just, you know, any... Cadence, you know, is there. You've shown, like, say for the gross margin, a kind of pretty steady improvement. Should we just think about EBITDA the same way through the back half? And can you give a sense, and sorry if I might have missed this, but any updated thoughts on when total company positive EBITDA would be within reach? Thank you so much, Michael.

Michael Lavery: I was wondering if you could unpack the EBITDA thinking a little bit. Maybe just, you know, any cadence, you know, is there, you've shown, let's say, for the gross margin, a kind of pretty steady improvement. Should we just think about EBITDA the same way through the back half? And can you give a sense?

Michael Scott Lavery: Was wondering if you could unpack the EBITDA thinking a little bit.

Speaker Change: Maybe just.

Speaker Change: Any any.

Speaker Change: <unk> was there.

Speaker Change: You've shown let's say for the gross margin that kind of pretty steady improvement should we just think about EBITDA the same way through the back half. Thank.

Speaker Change: And can you give us sense and sorry, if I might've missed this but any updated thoughts on when total company positive EBITDA.

Michael Lavery: And I'm sorry if I might have missed this, but any updated thoughts on when total company positive EBITDA would be within reach?

Speaker Change: Be within reach.

Jean-Christophe Platon: Thank you so much, Michael. Jayce, again, good to hear you. I think let's be super thrilled from achieving profitable goals in and remains our unique north star and I am and we are fully committed to it.

Speaker Change: Thank you so much micro JC again, good to hear you.

Jean-Christophe Platon: JC, again, good to hear from you. I think, let's be super clear upfront. Achieving profitable growth is and remains our unique North Star, and I am, and we are fully committed. Clearly, as you have just heard, we are pleased with the significant structural progress we have made so far, illustrated in Exhibit 1, Gross Margin Increase, and Exhibit 2, SGA Recalibration that we have highlighted in our prepared remarks and just in our conversation with Kenneth.

Speaker Change: I think let's be super clear upon achieving profitable growth ease and remains our unique knockdown and I am and we are fully committed to it.

Jean-Christophe Platon: Clearly, as you have just heard, we are pleased with the significant structural progressives we have made so far. It has played the EBITDA one, gross margin increase, EBITDA two, S.G.E.R.I.E. calibration that we have highlighted in our paper, remarks, and just in our conversation with Kevin.

Clearly as you've just heard we are pleased with the significant cultural processes. We have made so far it is placed in exhibit one gross margin increase exhibit two SBA recalibration that we have highlighted in our prepared remarks, just in our conversation with Kevin having.

Jean-Christophe Platon: Having said this, we know we still have plenty of work to do to get to our longer term targets, and this is exactly why we know, because we know we still have remaining progress journey in front of us with three segments in three different situations of maturity, execution, and performance that I don't want us to commit to a specific date of reaching profitability. We want to continue to make the right decisions day by day, one after the other, to bring this business to profitable goals as quickly as possible, and I don't want us to make this decision for what is; I want us to make this decision for what is right for the business and not to lend on a specific date.

Jean-Christophe Platon: Having said this, we know we still have plenty of work to do to get to our longer-term targets. And this is exactly why we know, because we know we still have a progress journey in front of us, with three segments in three different situations of maturity, execution, and performance, that I don't want us to come to a specific date of reaching profitability. We want to continue to make the right decisions day by day, one after the other, to bring this business to profitable growth as quickly as possible, and I don't want us to make this decision for what is... I want us to make this decision for what is right for the business and not to lend on a specific date.

Speaker Change: Having said this we know we still have plenty of work to do to get to our longer term targets and this is exactly why we know because we know we still have remaining.

Speaker Change: Remaining progress too I mean part of us with three segments with three different situations of maturity execution and performance that they don't want us to commit to a specific date of reaching profitability.

Speaker Change: We want to continue to make the right decisions day by day, one after the other to bring this business to profitable growth as quickly as possible and they don't want us to make these decisions for what I want us to make this decision for what is right for the business and not to lend on a specific date.

Speaker Change: Okay. That's helpful and then.

Marie-Josée Davy: Okay, that's helpful, and then, Follow-up on SG&A, I guess tied to corporate costs. You've talked about some of the SG&A cost savings, but corporate, at least, has been pretty flat. Is that the right expense level? Should we expect it? to stay there?

Michael Lavery: Okay, that's helpful.

Michael Lavery: And then follow up on S.G.N.A. I guess tied to corporate costs, you've talked about some of the S.G.N.A. cost savings, but corporate at least has been pretty flat.

Speaker Change: Just a follow up on SG&A, I guess tied to corporate costs, you you've talked about some of the SG&A cost savings, but corporate at least has been pretty flat.

Maria Jose W.: Is that the right expense level? Should we expect it to stay there? Is there any room for improvement going forward there or just how to think about what the S.G.N.A. impact is on that corporate line? Yes, sure.

Speaker Change: Is that the right expense level should we expect it.

Marie-Josée Davy: Is there any room for improvement, you know, going forward there? Or just how should we think about what the SGA impact is on that corporate line? Hi Michael, this is Marie-Josée speaking. You're right.

Speaker Change: To stay there is is there any room for improvement.

Speaker Change: Going forward, there or just how to think about.

Speaker Change: What the impact is on that corporate line.

Speaker Change: Yeah sure Hi, Mike This is Michael speaking.

Maria Jose W.: Hi, Michael. This is Michael's speaking. You're right. We mentioned that it's pretty flat compared to last year, but we also mentioned that it includes expenses related to some global initiatives that benefit all segments. So this is the takeaway of the quarter. Now, we continue to work, definitely on S.G.N.A. Every calibration. We have done some, if you recall, we have already shared that we have done two rounds of savings program. We continue to work on that. And we continue to deliver on a long-term target as G.C. just mentioned. So corporate, we expect corporate to be approximately flat going...

Marie-Josée Davy: We mentioned that it's pretty flat compared to last year, but we also mentioned, right, that it includes expenses related to some global initiatives that benefit all sectors. So this is the takeaway for the quarter. Now, we definitely continue to work on SG&A recalibration. We have done some, and if you recall, we have already shared that we have done two rounds of savings programs. We continue to work on that, and we continue to deliver on a long-term target, as JC just mentioned. So, corporate, we expect corporate to be approximately flat going forward. So all the SG&A cuts are just in the segments then, is it just that simple? and Michael.

Speaker Change: You're right, we mentioned that it's a pretty flat compared to last year.

Speaker Change: But we also mentioned that it includes expenses related to some global initiatives that benefit or segments.

Speaker Change: D C. D. C is the takeaway of the quarter now.

Speaker Change: Continue to work that A&P SG&A every calibration.

Speaker Change: We have done some if you'll recall we have already shown that we have done.

Wrong of our savings program, we continue to work on that.

Speaker Change: And we continue to deliver on that.

Jay: As Jay just mentioned.

Speaker Change: So corporate we expect corporate to be Approx.

Jay: Flat going forward.

Maria Jose W.: for Work.

Michael Lavery: So all the SCNA cuts are just in the segment sound, is it just that simple?

Speaker Change: So all of the SG&A cuts or just in the segment.

Is it just that simple.

Maria Jose W.: I did not understand the question. Sorry, Michael. Is that again? Well, so yeah, so I guess it's at least where it nets out if you're making these SCNA cuts. They really are within the segments, and corporate costs are just kind of running steady. Was that the right way to think about it? Yes, absolutely. Over, yes. Okay, all right, think about it.

Speaker Change: I did not understand that.

Speaker Change: Sorry, Mike is that again.

Marie-Josée Davy: Do that again? Well, so yeah, so I guess at least where it nets out, if you're making these SG&A cuts, they really are within the segments, and corporate costs are just, you know, kind of running steady. Was that the right way to think about it? Yes, absolutely, and more than yes. Okay. All right. Thanks a lot. And the next question comes from Kaumil Gajrawala with Jeffreys

Speaker Change: So, yes, so I guess at least.

Speaker Change: If you're making these SG&A cuts they really are within the segments and corporate costs are just.

Speaker Change: Running study was that the right way to think about it.

Speaker Change: Yeah.

Speaker Change: Yes, absolutely yes.

Speaker Change: Okay, alright, thanks, a lot.

Speaker Change: Yeah.

Kaumil Gajrawala: And the next question comes from Kaumil Gajrawala with Jeffries. Please go ahead. Hey guys, good morning. I guess good afternoon, depending where you are. We're hearing a lot about the slowdown in away-from-home consumption, coffee shops, and food service, and across sort of the board.

Speaker Change: And the next question comes from.

Cal Mill Gyro Waller with Jefferies. Please go ahead.

Daniel Ordonez: Hey guys, good morning, or I guess good afternoon, depending on where you are. We're hearing a lot about the slowdown in away-from-home consumption at coffee shops and food services across sort of the board. As you think about sort of that incremental upside that you're reinvesting in the business, can you maybe just talk about, is it in an effort to sort of bend the curve on what's happening on that side, or is it more broad in terms of where you're spending it? Kaumil, how are you doing? This is Daniel.

Speaker Change: Hi, guys. Good morning, or I guess good afternoon, depending on where you are we're hearing a lot about the slowdown in away from home consumption.

Speaker Change: Coffee shops in foodservice and across the board as you think about sort of the incremental upside that you are reinvesting into the business can you maybe just talk about is it in an effort to sort of.

Kaumil Gajrawala: As you think about sort of that incremental upside that you're reinvesting into the business, can you maybe just talk about is it in an effort to sort of bend the curve on what's happening on that side, or is it more broad in terms of where you're spending it? Kaumil, how are you doing? This is Daniel. Just to double-click on your questions, make sure I understand and respond appropriately. Are you talking about the generalized market slowdown, or are you referring to a generalized market slowdown? Okay, thank you. Thank you for your question.

Speaker Change: Bend the curve on what's happening on that side or is it in is.

Speaker Change: Is it more broad in terms of where you're spending it.

Daniel Ordonez: Just to double check on your questions, make sure I understand and I responded properly. Are you talking about the generalized market slowdown, or are you referring to us? generalized market slowdown. Okay, thank you, thank you for your question.

Speaker Change: Camille how are you doing this is Daniel.

Just to double click on your question to make sure I understand are responded appropriately are you talking about the generalized market slowdown or are you referring to us.

Speaker Change: Generalized market slowdown.

Speaker Change: Okay. Thank you. Thank you for your.

Speaker Change: For your question now.

Daniel Ordonez: No, I have to go back to not just these prepared remarks but to the few last ones, where we don't see such a slowdown for ourselves. We have consistently invested resources, both quality and quantity, across the three regions, and we're pretty pleased with the progress we are making. You will recall significant growth in the channel, which I have referred to on a few occasions for us, has different layers within the channel, different sub-segments in which we balance both accelerated growth and profitability, margin, and profitability.

Daniel Ordonez: No, I have to go back to not just with this preparatory mark, but to the few last ones, which we don't see such a slowdown for ourselves. We have consistently invested resources, both quality and quantity, across the three regions, and we're pretty pleased with the progress we are making. You will recall significant growth in the channel, which I have referred a few in a few occasions for us have different layers within the channel, different sub-segment in which we balance both accelerated growth and profitability, margin and profitability. So we see a good picture ahead of us that you can see already in the numbers, and the outlook is positive too.

Speaker Change: I have to go back to not just with these prepared remarks with a few two last ones, which we don't see such a slowdown or ourselves.

Speaker Change: We have consistently invested resources, both quality and quantity across the three regions and we're pretty pleased with the.

Speaker Change: With the progress we are making you will recall significant growth.

Speaker Change: In in the channel, which I have referred to a few in a few locations for US has detailed different layers within the channel different sub segments.

Speaker Change: Which we balance both accelerated growth.

Daniel Ordonez: So we see a good picture ahead of us that you can see already in the numbers, and the outlook is positive too. We will continue to invest in this because this is where we bring the Oatly magic. JC talks about it in every single remark.

Speaker Change: And profitability margin and profitability so we.

Speaker Change: We see a good picture ahead of US that you can see already in the numbers and the outlook is positive we will continue to invest on these because this is where we do bring yield can be magic.

Daniel Ordonez: We will continue to invest on this because this is where we do bring the ultimate magic. JC talks about it in every single remark. This is where the consumers experience the brand, and we see a bright outlook for us come here. I hope that's helpful. Thank you. Yeah, that's helpful.

Speaker Change: <unk> talks about that in every single remark.

Daniel Ordonez: This is where the consumers experience the brand, and we see a bright outlook for us, Kaumil. I hope that's, Thank you. Yeah, that's helpful.

Speaker Change: Is where the consumers experience the brand and we see a bright outlook for us Camille I hope that's helpful.

Marie-Josée Davy: And then when I think about, or I guess when we all think about the exit costs, some of a lot of these sort of one-time cash or non-cash exit costs for things, are we largely complete? Or should we expect more over the course of the year? So, this is Marie-Josée.

Thank you Yeah. That's helpful and then when I think about or I guess, when we all think about the exit costs some of it a lot.

Kaumil Gajrawala: And then what I think about, I guess, when we all think about the exit costs, some of a lot of these sort of one-time cash or non-cash exit costs for things. Are we largely complete, or should we expect more over the course of the year?

Speaker Change: These sort of one time.

Speaker Change: Cash or noncash exit costs for things, a REIT largely complete or should we expect more over the course of the year.

Maria Jose W.: So this is my Jose. Very nice meeting you. In the preferred remarks, you saw that we have called out here today 13 million out of the 20 million that we have announced quarter ago, quarter ago. So we have 7 million to go. Those 7 million, we look up here as we have already planned, which is through the end of fiscal 2025. So that's until we're on track and really nothing to call out. here.

Speaker Change: So this is Michael J very nice meeting you in the prepared remarks, you saw that we have called out year to date 13 million out of the 20 million that we have announced a quarter ago turn cycle. So we have 7 million 7 million, we look cure and we have already planned.

Marie-Josée Davy: Very nice meeting you. In the prepared remarks, you saw that we called out $13 million year-to-date out of the $20 million that we announced a quarter ago, two quarters ago. So, we have $7 million to go. Those $7 million will occur as we have already planned, which is through the end of fiscal 2025. So, definitely, we're on track and really have nothing to call out. Okay, great. So, nothing else.

We achieved towards the end of fiscal 'twenty is occupied so as I think you are on track and really nothing to call out here.

Maria Jose W.: Okay, great. So, nothing else. That's everything according to plan, I guess. Yep, great.

Speaker Change: Okay, great so nothing else that's.

Marie-Josée Davy: Everything is according to plan, I guess. Yep, correct. Great, thank you.

Speaker Change: Everything according to plan I guess.

Speaker Change: Yes.

Speaker: Thank you.

Speaker Change: Thank you.

Speaker Change: That's coming.

Dara Mohsenian: The next question comes from Dara Mohsenian with Morgan Stanley. Please go ahead.

Operator: The next question comes from Dara Mohsenian with... Morgan Stanley, please go ahead. Hi guys. Just to follow up on Michael's question, any flavor on Q3 versus Q4 EBITDA progression, specifically in the back half of the year, just trying to frame the quarterly EBITDA progress as we think about your path to profitability? And specifically, as you look out to 2025, I know you won't lay out goals today, but can you just discuss, conceptually, are there additional cost savings you think you can go after for 2025, just after Thanks. Thank you so much, Sarah.

Dara <unk>: The next question comes from Dara <unk> with.

Dara <unk>: Morgan Stanley. Please go ahead.

Dara <unk>: Okay.

Dara Mohsenian: I guess just to follow up on Michael's question, any flavor on Q3 versus Q4 EBITDA progressions, specifically in the back half of the year, just trying to frame the quarterly EBITDA progress, as we think about your path to profitability.

Speaker Change: Hi, guys.

Speaker Change: To follow up on Michael's question.

Dara <unk>: Any flavor on Q3 versus Q4, EBITDA progression specifically in the back half of the year just trying to frame the quarterly EBITDA progress as we think about your path to profitability.

Dara Mohsenian: And specifically, as you look out to 2025, I know you won't lay out goals today, but can you just discuss conceptually, are there additional cost savings you think you can go after for 2025, just after the profitability focus here in 2024? Thanks. Thank you so much, Dara.

Speaker Change: And specifically as you look out to 2025, I know you won't lay out goals today, but can you just discuss conceptually are there additional cost savings you think you could go after for 2025, just after the profitability focus here in 2024.

Dara <unk>: Yes.

Dara <unk>: Okay.

Jean-Christophe Platon: Great to have you on the call. JC speaking. So first of all, on your quarter on quarter comparison, I think, broadly, you can expect Q4 to be better than Q3. But, of course, as you know, we will not be guiding by quarter. So that's the trend I want you to have. And just building on your second point, which is SG&A and building on what Marie-Josée has well explained earlier. First, let's share our belief.

Thank you so much Dr. Greg <unk>, Nicole JP speaking.

Jean-Christophe Platon: Great to have you on the call. JC speaking. So, first of all, broadly on your culture, on culture, compared to, I think, broadly you can expect you for being better than Q3, but of course, as you know, we will not be guiding by culture. So, that's the pen I want you to have. And just building on your second point, which is SGA and building on what Maria Jodie has well explained earlier. First, let's share our belief. Our belief is that in any business, the change for efficiency should never stop. We are constantly and we'll always dynamically look for ways to become more efficient.

Speaker Change: So first of all broadly on your quarter on quarter comparison, I think broadly you can expect Q4 being better than Q3, but of course as you know we will not be guiding by quarter. So that's the that's the plan.

Speaker Change: I wanted to web and just building on your second point, which is SG&A and building on what Mike when explained earlier.

Jean-Christophe Platon: Our belief is that in any business, the chase for efficiency should never stop. We constantly and will always dynamically look for ways to become more efficient. It's the competitiveness duty of any business to permanently adapt and adjust, and this applies across the entire company. So that's what we will keep doing. Clearly, we are not trying to signal that we are planning new massive SDNA reductions.

Speaker Change: That said our belief our belief is that in any business. The tasteful efficiencies would never stop we are constantly and we'd always dynamically look for ways to become more efficient.

Jean-Christophe Platon: It's our competitiveness duty of any business to permanently adapt and adjust, and this applies across the entire company. So, that's what we will see doing. Clearly, we are not trying to signal that we are planning new, massive SGA reductions. What we are saying is we want to complete our work on the previously communicated reductions. And then we believe that one piece is done. We believe that our SGA structure in total will be the appropriate size for the company. So, more work to do and mindset of permanent efficiency change overall in the company at the service of our mission.

Speaker Change: Our competitiveness duty of any business to permanently adapt and adjust the supply across the entire company. So thats, what we will keep doing.

Speaker Change: Clearly we are not trying to signal that we are planning new massive SG&A reductions. What we are saying is we want to complete our work on the previously communicated addictions.

Jean-Christophe Platon: What we are saying is that we want to complete our work on the previously communicated reductions, and then we believe that once this is done, we believe that our SDNA structure in total will be the appropriate size for the company. So there is more work to do, a mindset of permanent efficiency change overall in the company at the service of our mission. Great, thanks. And the next question comes from John. Baumgartner with Mizzouho, please go ahead.

Speaker Change: And then we believe that once this is done we believe that our SG&A structure in total will be the appropriate sites for the company. So more work to do a mindset of permanent efficiently Chase overall in the company at the service of our mission.

Dara Mohsenian: Great.

Speaker Change: Great. Thanks.

John Baumgartner: Thanks. And the next question comes from John from Gartner with Mizzouho. Please go ahead. Good morning. Thanks for the question. Maybe first off, from Maria Jodie, in terms of the free cash, what was behind the provision that was recorded in Q2 and cash from operations? That line has been followed over the last couple of quarters and had a big impact on Q2 cash. Aside from that, what are your expectations for cash burden in the back half of the year, and is it possible to see cash from operations turn positive at some point, or is that still a little bit optimistic?

Speaker Change: And the next question comes from John.

John: From Gardner with Mizuho. Please go ahead.

John: Hi, good morning, Thanks for the question.

Marie-Josée Davy: Hi, good morning. Thanks for the question. Maybe first off, for Maria Jose, in terms of free cash, what was behind the provision that was recorded in Q2 in cash from operations? That line has been volatile in the last couple of quarters and had a big impact on Q2 cash. I guess, aside from that, what are your expectations for cash burn in the back half of the year and is it possible to see cash from operations turn positive at some point, or is that still a little bit optimistic? Hi there. Let me just answer the first question.

John: Maybe first off.

John Joseph Baumgartner: For from original day in terms of the free cash what what was behind the provision that was recorded in Q2 and cash from operations.

Speaker Change: That one had been volatile the last couple of quarters, but I had a big impact on Q2 cash.

Speaker Change: I guess aside from that what are your expectations for cash burn in the back half of the year and is it possible to see cash from operations turned positive at some point or is that still a little bit optimistic.

Maria Jose W.: Hi there.

Speaker Change: Hi, Dara, let me just answer to the first one please on slide <unk>, we are talking about maybe against that amount. We are talking about the sovereign says so in D C to be.

Maria Jose W.: Let me just enter to the first one provision twice. We are talking about the legal settlement. We are talking about the severances. So, this is the two big pockets. When it comes to our liquidity position, we remain pung in our liquidity position. We are 345 million and our cash positions remain in the back half of the year and we remain business plan. Now, if you look at what happened in this quarter, you have noticed as well the past quarter that we have caused exceptional elements such as existing our factories. Looking forward, those elements will not happen.

Marie-Josée Davy: Provisions-wise, we are talking about the legal settlement and severances. So these are the two big pockets. When it comes to our liquidity position, we remain strong in our liquidity position, right? We are at $335 million, and our cash positions remain sufficient to fully fund our business. Now, if you look at what happened in this quarter, you have noticed as well in the past quarter that we caused exceptional elements, such as closing our factories. Looking forward, those elements will not happen.

Speaker Change: When it comes to our liquidity position.

Speaker Change: We remain strong in our <unk>.

Liquidity position like we are at $345 million and our cash position remains sufficient to.

Speaker Change: To fully fund our business plan.

Speaker Change: Now if you look at what happened in this core terminal.

Speaker Change: Have not just as one this past quarter that we have poured exceptional elements such as exiting our factory.

Speaker Change: You're looking for what those elements will not happen.

Marie-Josée Davy: So when you look at the way you want to model our liquidity, keep in mind that we had, over the past two quarters, some exceptional elements that saved up to $31 million that will not happen moving forward. This is what I can say. I'm not going to give you guidance on the phasing, but keep in mind strong cash, 335 million, exceptional elements as we speak, and definitely, what I want to say is that big focus on liquidity, big focus on cash through what we already discussed, which is improvement in adjusted EBITDA, which is improvement in net working capital metrics, and as you notice this quarter, we have reduced, so through capex management.

Maria Jose W.: So when you look at the way of how you want to model our liquidity, keep in mind that we have over the past two quarters from exceptional elements that save up to 31 million that will not happen moving towards. This is what I can say. I'm not going to give you guidance on the phasing, but keeping mine across cash for 155 million exceptional elements, as we speak. And definitely what I want to say is that big focus on liquidity, big focus on cash for what we already discussed, which is improvements in Azure study data, which is improvements in networking capital metrics.

Speaker Change: So when you look at the way of how you want to you want to model our liquidity keep in mind that we had over the past two quarters. Some exceptional elements that stake up to 31 million that's been not happen moving forward.

Speaker Change: This is what I can say I'm not going to give you a guidance on the teething, but keep in mind.

Speaker Change: Cash 345 million exceptional elements as we speak and that is what I want to say that the big focus on liquidity big focus on cash for what we already discussed which is improvement in adjusted EBITDA, which is improvement in our working capital metrics and.

Maria Jose W.: And as you notice, this quarter, we have reduced a goal of our capex.

Speaker Change: This quarter, we have reduced our Glenn our capex so from Capex management.

John Baumgartner: So from capex management, hope that helps. Thanks for that, Daniel. In terms of your new markets in Europe, in some of these markets like Spain, it's more of a private label market, with smaller brands, and sort of lacks a dominant brand of leader. Then you have other markets like France where you've got one big brand of company with dominant market share, and the influence of private label and smaller brands is compared to the lower. To understand, are you managing your entry approach differently based on the different competitive landscapes in these markets. I'm response, thank you.

Marie-Josée Davy: Daniel, in terms of your newer markets in Europe, in some of these markets, like Spain, it's more of a private label market with smaller brands and sort of lacks a dominant branded leader. Then you have other markets like France, where you've got one big branded company with a dominant market share, and the influence of private label and smaller brands is comparatively lower.

Speaker Change: Hope that helps okay.

Speaker Change: Okay.

Speaker Change: Thanks for that and then Daniel in terms of your newer markets in Europe and some of these markets like Spain, it's more of a private label market with smaller brands and sorta lacks a dominant branded leader then you have other markets like France, where you've got one big branded company with dominant market share and the influence of private label and smaller brands.

Speaker Change: <unk> will be lower.

Daniel Ordonez: To what extent are you managing your entry approaches differently based on the different competitive landscapes in these markets? I'm curious how you're navigating that and what you're seeing in terms of the competitive response. Fabulous. Thank you, John. Good to speak to you today. One of my favorite topics.

Speaker Change: Extent are you managing your entry approach it differently.

Speaker Change: On the different competitive landscapes in these markets I'm curious, how you're navigating that and what youre seeing in terms of the competitive response. Thank you.

Populus: Populus. Thank you John good to see with the speak to you today.

Daniel Ordonez: Thank you, John. Good to see you with the speaker today. One of my favorite topics. Listen, you're absolutely right to call out that we don't take any market as equal, as you have just seen, for instance, which is recently launched in Mexico. No market is alike. What is a life, obviously, is our model, which is proven to work in any of them so far. So I will put a spin on your question if you don't mind, but first by giving you an overall view about the new markets. We're really, really excited about the progress we're making, and we, as you can imagine, have long and hard about starting to show progress in these quarterly calls.

Daniel Ordonez: Listen, you're absolutely right to call out that we don't take any market as equal. As you have just seen, for instance, we just recently launched in Mexico. No market is alike. What is alike, obviously, is our model, which has proven to work in any of them so far.

Speaker Change: One of my favorite topics listen you're absolutely right to call out that we don't take any market as equal as you have just seen for instance, which has recently launched in Mexico no market is alike.

Speaker Change: What is alike, obviously, our model, which is proven to work in any of them. So far so I will I will put a spin on your question. If you don't mind, but first by giving you an overall view about the new markets. We're really really excited about the progress, we're making and we as you can imagine we thought long and hard about starting to show progress in there.

Daniel Ordonez: So I will put a spin on your question, if you don't mind, but first, I will give you an overall view of the new markets. We're really, really excited about the progress we're making. And, as you can imagine, we thought long and hard about starting to show progress in these quarterly calls.

Speaker Change: These quarterly calls.

Daniel Ordonez: Every city we land in, we now have proof that the magic of the brand and how these markets are prepared to welcome Oatly with open arms is really material. So that's number one there. When we are executing the model that I just called out, like in France, Spain, or Belgium, we are growing by triple digits. It's pretty impressive. And you see the impact. No matter how different the market is, it seems to be lifting overall category growth to very significant levels. Whether it's France or Spain, I wouldn't categorize them as private label or not, but that's what you may see in the numbers. The reality is we're looking at the level of maturity, which is totally different.

Daniel Ordonez: Every city we land, we have now proof that the magic of the brand and how these markets are prepared to welcome, only with open arms, is really material. So that's number one there. When we are executing the model that I just go out, like in France, Spain, or Belgium, we are growing in triple digits; it's pretty impressive. So, and you see the impact, no matter how different the market is, it seems to be releasing the overall category growth to very significant levels. Whether it's France or Spain, what I would, I wouldn't categorize them as private level or not; that's what you may see in the numbers.

Speaker Change: Every city, we land we have now.

Speaker Change: <unk> that the magic of the brands and how these markets are prepared to welcome only with open arms is really material.

Speaker Change: So that's number one there.

Speaker Change: We are executing the model that I, just called out like in France, Spain, Belgium, we are growing in triple digits and speaking proceeds so.

Speaker Change: And Youll see the impact no matter, how different the market east it seems to be leasing the overall category growth to very significant levels, whether it's France or Spain.

Speaker Change: I would I wouldn't categorize them as private label or not that's what you may see in the numbers the reality with looking at the level of maturity, which is totally different.

Daniel Ordonez: The realities we're looking at, the level of maturity, which is totally different. The update in coffee space, which you cannot see in numbers, in any market data, it's tremendous, and the speed, which we also reach the number one velocity in the retail space in these markets, is extraordinary. We are now the number one turning brand in Spain, France, and Belgium. It's pretty impressive. The picture is how we should look also at the expansion, which is what we're doing in a basically manner. We talked very briefly about this, but it's super important to us. We use efficiency being stored capacity, and also we have a lot of overhead synergies in the region.

Daniel Ordonez: The uptake in the coffee space, which you cannot see in numbers in any market data, is tremendous, and the speed at which we also reached the number one velocity in the retail space in this market is extraordinary. We are now the number one turning brand in Spain, France, and Belgium. This is how we should look at the expansion, which is we do it in a disciplined manner. We talked very briefly about this, but it's super important to us.

Speaker Change: The uptake in coffee space, which you cannot see in numbers in any market data is tremendous.

Speaker Change: The speed, which we also reached the number one velocity.

Speaker Change: In the retail space in these markets is extraordinary and we are now the number one <unk> brand and <unk>.

Speaker Change: Spain, France, and Belgium, it's breaking presses.

Speaker Change: This is how we should we should look also at the expansion, which is we do it in a disciplined manner with talked very briefly about week, but it's super important to us we use efficiently the installed capacity.

Daniel Ordonez: We use efficiently the installed capacity, and also we have a lot of overhead synergies in the region, right? So we're pretty pleased. Then again, now back specifically to your question, I wouldn't necessarily name or tag Spain as a private labor market. There are very, very important brands there.

Speaker Change: And also we have a lot of overhead synergies in the regions right. So.

Daniel Ordonez: So, we're pretty pleased. Then again, now back specifically to your question, I wouldn't necessarily name or tax Spain as a private level market. They're very, very important brands there. What there is not in Spain or Spain has been deprived from, what's a distinctive, disruptive brand that will drive the oatmeal category, as hopefully it's doing today. That's what consumers are enjoying, and that's why you see the oatmeal brand growing as it is growing. In France, for instance, where the market is potentially so much stronger, you see some exponential growth rates because of the lack of maturity.

Speaker Change: We're pretty pleased then again now.

Speaker Change: Typically to your question I wouldn't necessarily name or talk Spain, as a private label market. They are very very <unk>.

Speaker Change #102: Portland brands. There was there is not in Spain, or Spain has been deprived from what's a distinctive disruptive brands that will drive.

Daniel Ordonez: What Spain is not, or Spain has been deprived of, was a distinctive, disruptive brand that would drive the oat milk category as Oatly is doing today. And that's what consumers are enjoying, and that's why you see the Oatly brand growing as it is growing. In France, for instance, where the market is potentially so much stronger, you see some exponential growth rates because of the lack of maturity.

Speaker Change: The.

Speaker Change: Oatmeal category as hotel is doing today, and that's what consumers are enjoying and Thats why youll see DLP brand growing as it is growing in France.

Speaker Change: For instance, where the market is potentially so much stronger you see some exponential growth rates a bit.

Speaker Change: Because of the lack of maturity that Frank population has been deprived of ultra milk in general right and you see that working welcoming us with open arms, so pretty pleased.

Daniel Ordonez: The French population has been deprived of oat milk in general, right? And you see, they're welcoming us with open arms. So pretty pleased. In a nutshell, the model seems to be working. No matter what the level of maturity of the market, the news value of the brand makes a difference. John, that's the headline that I would leave you with. Thanks, Daniel. That concludes our question and answer session. I would like to turn the conference back over to Brian Kearney for any closing remarks. Thank you, everyone, for joining us. Feel free to send me an email, and we can set up a follow-up call if you're interested.

Daniel Ordonez: The French population has been deprived of oatmeal in general, and you see they're working in welcoming us with open arms. So, pretty pleased. In a nutshell, the model seems to be working no matter what level of maturity of the market; the news value of the brand makes a difference. Don't that be? That's a headline that I would be given. Thank you, Daniel.

Speaker Change: In a nutshell the model seems to be working no matter what level of maturity of the market the new value of the brand mix makes a difference.

Speaker Change: That's the that's the headline that I would leave you with.

Danielle: Thanks Danielle.

Speaker: This concludes our question and answer session.

Danielle: This concludes our question and answer session I would like to turn the conference back over to Brian Kearney for any closing remarks.

Brian Kearney: Thanks a lot. Bye. The conference is now concluded. Thank you for attending today's presentation.

Brian Kearney: I would like to turn the conference back over to Brian Kearney for any closing remarks. Thanks everyone for joining us.

Brian Kearney: Thanks, everyone for joining us feel free to send me an email and we can set up a follow up call. If you're interested thanks a lot.

Brian Kearney: Feel free to send me an email, and we can set up a follow-up call if you're interested. Thanks a lot.

Operator: The conference is now concluded. Thank you for attending today's presentation.

Speaker Change #101: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Operator: You may now disconnect. ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Why are you still here? I'm not going anywhere. I'm going to be here forever. I'm not going anywhere. I'm not going anywhere. I'm not going anywhere. I'm not going anywhere. [inaudible]

Operator: You may now disconnect. Thank you.

Speaker Change #101: [music].

Speaker: I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I I know I know I know I know I know I know © © © © © © ©

Speaker Change #101: [music].

Speaker Change #101: [music].