Good morning, ladies and gentlemen, my name is Howard and I will be your conference operator today. At this time, I would like to welcome everyone to Coty's Third Quarter Fiscal 2015 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. As a reminder, this conference call is being recorded today, Thursday May 7. Thank you. I will now turn the call over to Kevin Monaco, Coty's Senior Vice President, Treasurer and Investor Relations. Mr. Monaco, please go ahead. Kevin Monaco - Treasurer, Senior VP & Head-Investor Relations: Good morning and thank you for joining us. On today's call are Bart Becht, Chairman and Interim CEO and Patrice de Talhouët, Executive Vice President and Chief Financial Officer. Before we begin, I would like to remind you that many of our comments may contain forward-looking statements, please refer to our press release and reports filed with the SEC where you will find factors that could cause actual results to differ materially from these forward-looking statements. In addition, except where noted the discussion of our financial results and expectations do not reflect certain non-recurring and other charges. You can find the bridge from reported to adjusted results in the reconciliation tables in the earnings release. I will now turn the call over to Bart.

Thank you, Kevin, and welcome everybody to Coty's third quarter results conference call. This morning, we'll take you through a summary of today's announcement and then Patrice and I will be pleased to take your questions. Q3 was the second consecutive quarter behind our new strategy of investing in fuel and growth of our Power brands and driving strong profit growth behind efficiency programs. We clearly have made excellent progress in driving growth behind our efficiency programs as shown by the 24% growth in Q3 adjusted operating profits. Patrice will detail our strong progress against Coty's $200 million efficiency program in a minute but the savings are very much driven by head count reductions, procurement savings and restructuring over our China mass business. Due to our strong performance in this area, we will be looking to increase the $200 million target for our Global Efficiency program in the months to come. We will come back to this subject in our revised target as part of our full year 2015 results discussion. Power brand and overall growth on the other hand is still muted for the quarter and year-to-date despite some clear bright spots. The bright spots for the year are Sally Hansen, Rimmel, Chloé, philosophy and Marc Jacobs, all of which continue to perform extremely well thanks to innovations such as Sally Hansen Miracle Gel, Marc Jacobs' Daisy Dream, Chloé Love Story and philosophy's Renewed Hope in a Jar. We are particularly proud to report that the robust appeal of the Miracle Gel line has allowed Sally Hansen to reach its highest U.S. market share level since our IPO. This success extends beyond the U.S. with Sally Hansen now achieving the number one nail brand position in several European markets such as the UK, the Netherlands, and the Czech Republic.…

[Operator Instruction] Our first question or comment comes from the line of John Faucher from JPMorgan. Your line is open.

Hello?

Yeah, can you hear me? Kevin Monaco - Treasurer, Senior VP & Head-Investor Relations: Yeah, now we can.

Okay, thank you. I want to talk a little bit about the difference between the Power brands and the non-power brands, and as you look at this how long does it take to get the non-power brands down to a level where they're no longer going to be a material drag on overall organic sales growth? I guess, so how long does that process take do you think?

That's a good question. So, what we're seeing year-to-date is Power brands are still showing growth and non-power brands clearly have a drag on the business. Within the non-power brands, however, there are some good brands and then there's a set which I would call Celebrity Fragrances which is largely a phenomenon which is dying out and that is the part which is posing the biggest issue from a drag point of view. It's not so much the smaller brands that we have which have a good following and loyalty. It's hard to say but if you look at the Celebrity Fragrances part, it has a substantial drag because in a number of cases we're seeing double-digit declines in some of these brands. So it will work its way through the system. I think going forward from a growth point of view, what needs to be done is not just to worry about that, is to very much to look at how we're going to accelerate growth across all our Power brands. And I think we're in a much better position to do that going forward than where we were six months ago for a very simple reason. We've created a substantial amount of space in the P&L, which will allow us to achieve our strategy of both driving growth behind increased investment and still driving profit growth by dropping some of the cost savings into the bottom line, and that's really what needs to be done. Is now that we have created substantial room in the P&L, we need to increasingly focus at reinvesting some of the monies that we are saving into the business, and in particular, in the Power brands. So to answer your question, the drag will continue on the bottom end of the portfolio but we need to accelerate the growth at the top end and that ultimately is going to gradually improve the overall performance of the company. This will take clearly some time but that's what we'll be focusing on going forward.

Got it. And if I can just ask a follow-up on that, as you look at the incremental investment on the Power brands, how much of that is you've talked about the reallocation of trade spending so which is more short term, how would you assess the balance of shorter term versus longer term investments as you look at the Power brands going forward?

So if you look at what has happened on a year-to-date basis to our advertising and promotional budget, you will see that in terms of absolute spend, there's not a lot changed. However, in terms of allocation, it's substantially changed. So we have substantially increased already the working media budget on our Power brands. We have rationalized spending on kind of like non-working dollars and we have rationalized spending on the bottom end of the portfolio. So – and you can see that in the success of some of the brands, some Power brands already. When I mentioned bright spots, all the bright spots which I've mentioned have seen substantial increases in investments and that needs to gradually happen across the entire Power brand portfolio. In terms of trade spend, the promotional situation is what it is, I believe there is opportunity for improvement but quite frankly, in the short term, short to medium term rationalizing non-strategic spend which is completely under our control is a much better source of cost savings and opportunity to reallocate it to our Power brands.

Great, thank you.

Thank you. Our next question or comment comes from the line of Jason Gere from KeyBanc Capital. Your line is open.

Okay, thanks. I guess just a follow up on John's question. If we could think about the reinvestment rate for I guess the next wave of cost savings, can you compare how you look at it versus when you came out with the efficiency program back a couple years ago and what you were planning on spending, is there a meaningful step up or is it really more or less the same but as you just said, more shifting, and then I have another question.

Yeah, I think it is more shifting of the spend. I would say we're going to stick with our strategy of trying to gradually step up the growth pattern behind our Power brands in the total company while continuing to show strong profit growth at the same time. So we have to do both. So it's much more a question of shifting monies within the A&P budget within the total P&L from non-strategic spend to strategic spend. If you were to look at our full year A&P spend as a percentage of net revenue, you will not see that much happening. But if you look at how the monies are shifted within the P&L, you already see a substantial shift out of non-strategic spend of non-working dollars into working dollars, and out of the bottom end of the portfolio into the top end of the portfolio and I think that pattern you will continue to see going forward.

Okay, great. Thank you. And then the other question I have is just on the Fragrance business. I was wondering you've had a couple of quarters in a row of negative like-for-like sales and I guess your view on how you're going to revitalize the Fragrance business getting it back to growth maybe by the fourth quarter into next year. If you could talk a little bit in that context about how much the mass channel's kind of weighing you down. And then just with that, the Fragrance – the margins were really good again and I'm just wondering how we should think about that going forward? Is this a business where we're really going to need see more scale to kind of drive margin upside or will the Global Efficiency programs really be able to do that on its own without acquisition? Thank you for taking my questions.

Yeah so, on Fragrance I would say the net revenue indicator of minus 2% is picturing a more negative situation than it is in reality. Because Fragrance has shown substantial volume growth but at the same time has a negative price mix which takes it to minus 2%. That already tells you that from promotional investment point of view we have optimization possibilities and that is also something which need to happen. So I think we have good initiatives on our plate going forward. We have the opportunity to invest where it counts in the brand equities of the brands. And we gradually need to release the tension on the trade spend without clearly impacting the volumes. So that's going to be a fine balance of shifting from let's call it a more sell-in to a more sell-out approach where you invest more in brand equity and less in trade spend. But underlying you need to know that volume growth on Fragrances is very good. There is really no issue from a volume point of view, there is an issue from a net revenue point of view and which is also ultimately having a negative impact on the margins which we're offsetting with cost optimization. Does that answer your question?

Yes, thank you.

Okay.

Thank you. Our next question or comment comes from the line of Bill Schmitz from Deutsche Bank. Your line is open.

Hey guys, good morning.

Good morning.

Can you just talk about the list of Power brands and if you thought about maybe culling the list? So kind of like how you define a Power brand and what makes a brand become a Power brand, and then maybe what makes a brand kind of fall out of that set, and then I have a follow-up as well.

Right, so for us what is a Power brand? First, it's a brand which has either a certain amount of scale or has the potential to achieve that scale. It has good growth opportunities within the markets in which it operates. It has a margin structure which we believe is attractive and it is in a category and in a situation where we believe we have the capability to grow it. And so clearly this is, this set of Power brands, the 10 Power brands that we have is at least once a year is up for review to make sure that this is the right list of brands. And we will go through this review once a year and I'm sure with the new CEO, Elio, we will have another discussion, if this is the right list for us, yes or no or not. So I would say at this point in time, there is very little reason to believe I would say to cull the list, and to change the list. We still have some brands where we don't, where we're not happy in terms of our growth profile but there are initiatives now being developed to address these problems. So for the time being, the list is the list.

Great, thanks. And then are you guys still looking at M&A and I was also wondering how important is scale in Fragrances broadly? Are there huge incremental advantages from adding incremental brands into the existing infrastructure?

I would not necessarily say that scale is the only reason for success in Fragrance, Color or any of our categories. It does help clearly from a cost optimization point of view but there is other factors which play a role than just scale.

Okay, and to add to the question, are you still looking at acquisitions because I know there's a lot of internal stuff going on and you just raised the savings targets so I'm just curious if there's just enough bandwidth to pursue an organic means to grow?

Yeah, as you can imagine we're not going to comment on any M&A speculation. So, I'm afraid I'm not going to answer this one.

No, no, it was worth a try. Thank you.

Thank you. Our next question or comment comes from the line of Chris Ferrara from Wells Fargo. Your line is open.

Thanks, guys. I wanted to talk about cost savings I guess more in general. So, your Fragrance margins are well above industry average, maybe best in class, yet across your organization, your savings are coming through very nicely obviously and net of any reinvestment so far. So I guess, in Fragrance, in particular, when you benchmark where your margins are, is the composition of the P&L maybe different than other best in class competitors you think? Or do you think that you can actually just widen the margin or the gap between you and second best in class or industry average on margins?

Okay, maybe because I've not worked in the cosmetics industry for this long but I'm personally I think some of the margins in a lot of these categories are sub-standard compared to the broader consumer goods industry. And in particular, when you're sitting on very high gross margins in many of these categories to work with operating margins at this level that would be they're just low. So, I know relative to some of the other industry players they might be higher. So I guess what I'm telling you is, it depends on what you take as a starting point. Patrice de Talhouët - Executive Vice President & Chief Financial Officer: And Chris, to build on what Bart has just said it's safe to say the last two quarter gives you an evidence that even if you are best in class in terms of proximity on the Fragrant segment keep on increasing that. So I think that gives you a little bit of the answer.

Great. Thanks. And I guess just a couple of sort of housekeeping ones, can you comment on I guess how big the contribution was from the Avon fragrances and then also this Skin & Body improvement is that, do you think that's a step up or is there any kind of fluctuation volatility near-term or do you think you've kind of cracked the code there where the margins are going to be a little bit better from here?

Yeah, I would say the cooperation with Avon is a good one, it is contributing to the net revenue performance of the company but it is not like huge. So we're not going to disclose specific numbers on this but it's a nice contribution but it is not huge. In terms of Skin & Body, in particular, Skin & Body profitability improvement clearly part of that is because of the China situation which has been addressed and that has a very substantial impact from a P&L point of view, and this is also part of the Global Efficiency program. I'm not sure you want comment anything on... Patrice de Talhouët - Executive Vice President & Chief Financial Officer: No, I think Chris, we said in one of our previous calls that the objective on the Skin & Body Care segment was to target a profitability which was low to mid-single digits and I think we're going there but this is quite sustainable, so the action that we are taking in place are fundamental actions to drive some sustainable growth.

Got it, thank you.

Thank you. Our next question or comment comes from the line of Lauren Lieberman from Barclays. Your line is open.

Thanks, Good morning.

Good morning.

My question on the Sally, the Miracle Gel in the U.S., I guess first was actually I heard that there was a sell-out situations. So I was wondering if there was, sales strength was possible to be even greater in coming periods, if that was in fact what had happened. And then also that there have been started to already be some value entries for these kind of faster Gel products, and if that's happening a bit more quickly maybe than you had anticipated? And then I do have a second question. Thanks.

So, can you repeat the last part?

Yeah, I was just saying that there have been some value price entries to kind of mimic the Miracle Gel formulation and maybe this is getting too granular but I was just curious about the technology kind of catching-up from lower price players more quickly than expected.

Yeah, so I can include a comment on that. So in terms of Miracle Gel clearly is a phenomenal success. The market share on Miracle Gel in the U.S. is I guess, correct me if I'm wrong guys, I think is about 19% on Miracle Gel only and it might even be higher in the most recent readings. And clearly has had a huge impact on the overall Sally Hansen market share in North America. So from a sell-out point of view, it clearly is doing extremely well. There are some competitors which are either in the market or coming into the market, it's not very clear that they provide the same product benefit as Sally Hansen provides at this stage. So we will continue to support clearly Miracle Gel, aggressively support it also going forward for a simple reason. The penetration and the trial levels on this product are still relatively low and so there's still substantial opportunity for growth here.

And then the first part of the question also, I meant rather than sort of sell-out in terms of sell-through I meant, literally the product being sold out of stores so the capacity issue if that's actually been the case? Sales were even constrained in this period because of supply.

So I would say that from a capacity point of view that we clearly are favoring the U.S. market at the moment because it is the first market where we've launched. We do not have capacity issues to deliver the product anymore in North America. Having said that, there are still out of stock situations at retail level, simply because we are not necessarily always getting the right amount of space for the product. And so the stock is sold out, in particular on weekends in certain key retailers, at times so...

Okay. And then because of that, it sounds like you maybe delayed some international markets or no? Because I know you said UK sounded like it was very strong but was there any delayed international sales?

There are other markets where the product is being delivered but it is – we still are to some extent capacity constrained.

Okay, great, thank you. And then the other thing still I know it's probably very small, but curious on how the Chloé skin care launch had gone and just kind of your general interest in really that level of perceived skin care? Thanks

I don't think we have Chloé skin care, at least not...

...launched in Asia, I read about it – I mean a couple months ago but...

Yeah.

Maybe it's that small?

Okay, it's puny.

Okay.

It's less than puny.

Okay, very good. Thank you.

Okay.

Thank you. Our next question or comment comes from the line of Olivia Tong from Bank of America Merrill Lynch. Your line is open.

Great, thank you. Two questions first on – I appreciate all the comments around strategic versus non-strategic spend and the shifting there. But we haven't yet seen a lift in overall like-for-like growth. So can you help us understand the moves you're making and the confidence in the moves that you're making and how they will ultimately result in top line improvement? And then on the cost saving progress just – do you consider this SG&A run rate that you have this quarter the new run rate or was there something substantially contributing to Q3? Thanks.

So let me start with the like-for-like and I'll leave the SG&A one to Patrice. So in terms of like-for-like growth, so the key initiatives that need to be taken. So what we did is we clearly have a strategy of two legs. One is to drive growth in the Power brands and overall company on a like-for-like basis and the other one is to improve fundamentally the margin situation on the business. So we have started with the first one. So we have instigated a substantial program of cutting non-strategic spend across all lines of the P&L in order to drive profit growth, and create space for reinvestment. So I would say the first phase is not completed but it is well in motion and we now have capability in the company to continue that. So that is a very good start. So now clearly we need to move and also start implementing step number two which is to reinvest some of these monies back in the business in our Power brands on key initiatives. And that is now gradually starting to get done. Some clear examples are some of the brands which are called the bright spots where we have already increased investment behind good initiatives, Sally Hansen Miracle Gel being probably the most prominent example. But we now will be gradually expanding this to more brands. But once we get that up and running completely, we should see gradual improvement in the like-for-like growth rate of the Power brands as well as the total company. So but clearly this will take a little bit of time in order to do that. But I would say we are well on the way on the efficiency programs in building a better business. Now we need to translate that into a better like-for-like growth rate. Patrice de Talhouët - Executive Vice President & Chief Financial Officer: So, Olivia, on your question regarding the SG&A run rate. So I think it's fair to say that out of the $80 million that we are about to generate in fiscal 2015, a third of that is sitting in the N city (32:07) line and this is really about indirect procurement and making sure that we spend our money wisely. And two third of that is to be attributed to the cost structure. All this clearly is recurring so these are no one-offs and you should see the benefit of all this in fiscal 2016.

Great. Thank you. And then if I could just follow up on two more, first, what was the actual growth of the Power brand? And then one housekeeping thing, what share count are you using given the Bourjois deal for Q4? Thanks so much.

Can we repeat the second question?

Sure, it was what share count are you using given the Bourjois deal for Q4?

Right. So our Power brand growth was low single-digits and clearly very much split on a by brand basis as already highlighted before. So, in terms of Bourjois. Patrice de Talhouët - Executive Vice President & Chief Financial Officer: 370 million shares.

Thank you very much.

Thank you. Our next question or comment comes from the line of Steve (sic) [Steph] Wissnik from Piper Jaffray. Your line is open. Stephanie Schiller Wissink - Piper Jaffray & Co (Broker): Hi, good morning everyone, it's Steph Wissink. Just two questions, the first related to the Celebrity Fragrance trend. Can you just talk a little bit about some of the contractual obligations you have? Within those agreements, is there an opportunity to step down some of the cost outlay based on the decelerating performance? And then separately, I think you talked just moments ago about the proportionality in the savings, two thirds to go to gross margin line and a third to G&A. As you reinvest the dollar should we think about that proportionality staying similar in terms of adding back some of the cost saves of going forward? Thank you.

Yeah, on Celebrity before I mislead you, it's not like that every Celebrity Fragrance is doing poorly now, so there are some which are doing fine and there are some which are not doing fine and just fading away as you would expect, like celebrities. Some celebrities fade away, and therefore, the fragrance fades away with them. In other cases the Celebrity Fragrances are still doing fine. Overall as a category segment it's not doing that well. In terms of cost structure, like I already mentioned earlier, we have cut support at the bottom end of the portfolio to reallocate monies to the top end of the portfolio. Clearly on Celebrity Fragrance in some cases we've cut support levels, there's no question but that doesn't mean we've cut it on all Celebrity Fragrances. We've only cut it on certain brands at the bottom end of the portfolio. Patrice de Talhouët - Executive Vice President & Chief Financial Officer: So on your second question so let me slightly amend what you have just rephrased, so the cost structure so the One – the Global Efficiency Plan, sorry, of $80 million is split one-third of the savings is in the N City (35:05) line and two-third of the savings is in the fixed cost structure line. Now in terms of reinvestment you know as Bart was saying, clearly, our top priority for the time being after building a better business is to build a bigger business. So we need to reinvest some of these savings opportunistically into our programs and to shift some more money into working dollars. So that's what we're going to do in the coming quarters.

Yeah, I think when you think about investment levels on the total company in terms of A&P for the full year I don't think you are going to see a huge difference in terms of percentage of net revenue spend. So you should not be concerned that we are going to reduce investment in the business. We are simply reallocating monies within the A&P line from the bottom end to the top end of the portfolio and from non-working to working. Stephanie Schiller Wissink - Piper Jaffray & Co (Broker): Thank you.

Thank you. Our next question or comment comes from the line of Mark Astrachan from Stifel. Your line is open. Mark S. Astrachan - Stifel, Nicolaus & Co., Inc.: Hey, good morning, everybody. Bart, I guess I'm just curious holistically does JAB view themselves or need to be a controlling shareholder of Coty?

Yes. Mark S. Astrachan - Stifel, Nicolaus & Co., Inc.: Under all circumstances they want to have control?

Well we – with all our consumer goods companies we like to have control, yeah, that is our central premise. And then we're going to have a debate on how we define control, but we like to be a controlling shareholder. We invest in companies where their premium brands which have strong growth opportunities and where we can clearly see profit and cash benefits. And we like to control the shape of events behind these companies. So the answer is over time, we like to make sure that where we invest we have a control over the future path of the company. Mark S. Astrachan - Stifel, Nicolaus & Co., Inc.: Got it, okay. So that must be subject to interpretation. I guess we could discuss that in some other capacity. Also curious what made Bourjois an attractive asset to Coty?

Bourjois is an attractive asset to us for a very simple reason, it's a very strong brand it sits more at the premier end of the Color category compared to existing portfolio. It has strong positions in a number of European markets in the Middle East. It is a great addition as a result to our portfolio. We know how to manage this category as still good growth opportunity – and good profit opportunity in our mind. And clearly, it also improves our overall ranking in Color on a global basis, but I would say that's more of a secondary benefit. The clear reason why we're buying this is because we believe this is a good brand which has opportunity for growth, and margin, cash and therefore good from a shareholder point of view. Mark S. Astrachan - Stifel, Nicolaus & Co., Inc.: Got it. And just sort of related to some of the other questions on spending, so is that a brand as you sort of think about redeploying cash that you think perhaps the trajectory of growth can change with selected and more effective reinvestment?

Potentially yes, it's a bit early for that to make that assessment. We just bought the business and so, we're not that arrogant to sit here and say that we know everything about the brand. So our first job is to actually really understand this business in detail and as part of that understanding, we have flexibility within the P&L to further support it because we see fantastic growth opportunities and I'm sure we'll act on it. But first step is for us really is to understand it, welcome these people into our organization and to make sure that we work with them in order to make this a better business. Mark S. Astrachan - Stifel, Nicolaus & Co., Inc.: Perfect, okay. Thank you, guys.

Thank you. Our next question or comment comes from the line of Javier Escalante from Consumer Edge Research. Your line is open.

Good morning, everyone. I have a question with regards to the Power brands that are a drag. If I have the list correctly, Adidas is one of them, the other is Playboy. And at some point in time, the strategy of these two brands were very related to China and to the extent that China has been folded to what extent that's what is the drag and what other emerging markets these two brands do you think have opportunity. And the second question has to do also with OPI, which is the other brand that doesn't seem to be doing well even though it had been a roll-out to the Sally Beauty shop. So if you can help us understand what's happening with OPI and why is it not contributing to growth? Thank you.

So let's start with OPI and then we come to Adidas and Playboy. So, OPI is a fantastic brand and it doesn't matter what type of consumer research you do in the U.S. or outside you will find that this is one of the top-ranked cosmetics brands, in my mind, has a huge opportunity for growth going forward. There have been a number of issues on the business largely related to the transition from previous management into current management. And so there has been a number of managerial issues on this business which are in the process of being fixed. I am very optimistic that OPI going forward will start to see – we will start to see growth. So I think it's an amazing brand with amazing potential. So, there'll be absolutely no doubt in my mind that this is a Power brand and that simply there is executionally we need to fix a number of things in order to do well in this business. On Adidas and Playboy, I would say on both of these brands, Adidas, clearly, the fact that the brand is not doing that well from a reporting point of view, in part is because we've changed the whole structure in China and so we've seen a substantial negative impact from going from an owned business to a distributor business. In addition to that, there has been in the past some cutbacks in support and has been a lack of initiatives that is being addressed. So also there, I would say how much opportunity there is behind Playboy remains to be seen but I think a lot can be done on this brand and should be done. On Playboy I would say, we've lost a little bit of our way, this brand was nicely positioned a number of years ago. I think we deviated from that path in terms of brand positioning. Also there are a number of remedies which are being looked at and we will see in due time if they will fix the situation. Having said that you know, like I already outlined before, we will have annually once a year review what should be in the Power brand list and what should not, and so there is a review process of that. But I think I've just given you some background on the three brands.

Thank you. Our next question or comment is a follow-up from Bill Schmitz from Deutsche Bank. Your line is open.

...Europe very quickly because it seems like L'Oréal and Esteé had really good results in the region and yours was a little worse and I know you cited Southern Europe, so is that a function of inventory destocking or why do you think the industry seems to be accelerating and you guys are lagging a little bit?

Yeah, I know I'm – I don't want to be going to the same set of argument of trade destocking which is a phenomenon which the trade tries to do every single year. So I think fundamentally we still have some issues to address on a few of the Power brands like I just outlined, and I think if we have the right initiatives with the right brand positioning in investments we should be able to address that over time, and that should be gradually increasing the growth rate of the total company. I would like to highlight this one point though is that the geographical exposure of Coty from a market growth point of view, the market growth underlying where Coty is, is less that 2%. So, which is not necessarily the case for some of our competitors, so our exposure from a market growth point of view is a little bit less than some of our competitors. Having said that, there is no question in my mind that over time we should be able to address the growth situation of the company.

Okay, great. Thanks. That's very helpful.

Thank you. Our next question or comment comes from the line of Lauren Lieberman from Barclays. Your line is open.

...follow up on Bourjois, because Bart, I was a bit surprised – the answer on we're not sure if we can accelerate growth on this business. Candidly, why would you buy it then, I mean isn't that sort of the point?

I didn't say that.

Well I felt like, we're going to integrate it and we'll see I'm not sure we can change the growth trajectory. I think no one doubts the cost savings ability but...

I did not say that, I did not say that at all. What I said is that we first need to understand the brand before we decide if we're going to put substantial extra investments in them. There's no question in that it has a good growth trajectory already on the brands in a number of markets. The only question is for us to understand exactly the brand positioning before we decide to increase the investments on the business. That's what I said.

Okay. So it's more of timing issue than whether we will or won't?

Correct, yes, correct.

Okay, thanks. And then also just while I have you on, the promotional spending, I was curious if it's heavily skewed towards certain brands like is Calvin Klein and perhaps Marc Jacobs more of a challenge on that front than like the Chloés or the OPIs in the portfolio?

There is a difference in promotional spend between the brands. But frankly, I don't think that is really the fundamental issue or opportunity on these brands. It really is a question of having the right initiatives, the right positioning of the brands and increasing the investment levels on these businesses in order to accelerate growth. And that's what we will be doing going forward.

Okay. Thanks so much.

Okay. There are no further questions on the list so can I just thank all of you for attending the call and we'll see you in three months. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may now disconnect. Everyone have a wonderful day.