Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Natuzzi Nine Months 2015 Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. Joining us on today's call from Italy are Natuzzi's Chairman and Chief Executive Officer, Mr. Pasquale Natuzzi; the Chief Financial Officer, Mr. Vittorio Notarpietro; and Francesca Cocco, Investor Relations, Manager. As a reminder today's call is being recorded. I would now like to turn the conference over to Francesca. Please go ahead.

Good morning to our listeners in U.S. and good afternoon to those of you connected from Europe. Welcome to the Natuzzi third quarter and nine months 2015 conference call. After a brief introduction, we'll give room for a Q&A session. Mr. Pasquale Natuzzi together with the management team will be glad to answer to your questions. By now you should have received an email copy of the Natuzzi earnings result. If not, you can find this information within our Web site at www.natuzzi.com or please call our Investor Relations Department at +39 080 882011 to receive the results by email. You can also email information requests or questions to our email address investor_relations@natuzzi.com. We'll respond to you as soon as possible. Before proceeding, we'd like to advise our listeners that our discussion today could contain certain statements that constitute forward-looking statements under the United States security law. Obviously, actual results may differ materially from those in the forward-looking statements because of risks and uncertainties that can affect our results of operations and financial condition. We have discussed such risks and uncertainties, which have in the past affected and may continue to affect our results of operations and financial condition in our Annual Report or Form 20-F for the fiscal year ended December 31, 2014. These reports are available within our Web site www.natuzzi.com or from us upon request. You may also obtain a copy of our Form 20-F filing from the United States Securities and Exchange Commission. And now I'd like to turn the call over to our Chairman and CEO, Mr. Pasquale Natuzzi. Please Mr. Natuzzi.

Thank you. Good morning and good afternoon. After six quarter I would like to remind ladies and gentlemen that after six quarters of continuous improvements in the third quarter 2015 we finally achieved an EBITDA positive of €1.5 million. This one -- I mean we can consider this as really a wonderful time. This has been the main reason, the drivers of this result, has been retail improvement because it seems at the beginning of the year we opened, this year we opened 15 new stores and 90 new galleries. The newly opened store in Hong Kong which is a 10,000 square feet is already performing very-very well I was there a couple of months ago, beautiful stores there, if you've a chance to lookout you would be proud of the job we have done. Recently, we inaugurated a store in Naples, Florida where we already have seven stores in Florida Natuzzi mono-brand stores and we are planning to open another three of those stores in order to create the model for each state of United States of America where we can meet the new investor, new customer and based on market value and market shares that we aim to gain we can make a P&L based on divestment and return on investment which would require to operate -- to cover California for example and also the return that this investor will get from investment, all, in case, I mean probably we would decide also to open on our own. It depends -- this is the certain thing that we are considering very seriously. We completed the DOS chain resonation with the closure of nine of profitable store in Italy, Spain and China and in the meantime we improved the performance of our 56 DOS currently operational worldwide with the…

Thank you, Mr. Natuzzi, and good morning to everybody. Let's go through some more detail of the quarter numbers compare with the third quarter 2014. Net sales went up 3.1% as a result of higher upholstery business which were up by 4.4% and slightly decreasing non-core sales. Upholstery net sales were positively affected by foreign exchange rate by 8.4% and mix up 1.1% and negatively affected by volume which means fiscal to minus 5.1%. Particularly significant has been the private label performance, sales went up by 19.8%. Cost of goods sold improved dramatically from last year from 72.1% to 63.3% in this quarter, why, the most significant impact came from the transformation cost. The Company recovered from 2014 and efficiency in China and Italy, thanks I said before by Mr. Natuzzi to innovation and reorganization of the workflow in the production plant. Innovation is and will continue to be the most crucial to recover competitiveness. As you know we're almost stable as a percentage of sales although the Company invested 4.3% of net sales in advertising versus 3.5% in the 2014 third quarter also fixed SG&A expenses went down to 17.3% from 18.2% on net sales. As a result of the actions explained above EBIT was not far from breakeven with the same thing in minus 1.7% this quarter starting from a minus 7% last year. The impact of foreign exchange rate fluctuations on the EBIT has been positive by €2 million in the quarter. EBITDA, this is already said, the key message of this quarter as anticipated by management many quarters ago EBITDA has been positive in the quarter and close to breakeven in the nine months period. We announced this first target and here we're now delivering on time. Let’s see now some more details which are more…

Now we are ready for questions.

Thank you. [Operator Instructions] And we will go first to Stefano Rossi of Edmond de Rothschild.

Well good afternoon and first of all congratulations for these results which are really showing a good improvement since I started to follow the company. So I am lucky to let’s say starting to see some positive effects, I know that the company is working very hard since few years to improve these results and make them available to shareholders, so it's good to see these improvements. I have a couple of questions regarding, one, the -- let's say potential level of EBITDA that you have in your imagination, let's say without currency effect. Because if I understand well clearly there is a good improvement of mix but also some positive effect from the dollar which is good, I mean everybody knows that you are strong in America and this very good news. So what would be the normal let's say level -- or let's say the potential of mix improvement in terms of product and the effect at EBITDA level? And the second question I have is regarding net working capital which is also another great achievement obviously a reduction of debt goes to that, what is the normalized level of working capital that you see for your company going forward next few years?

Okay this is Vittorio. EBITDA level, I’ll start from saying that we are now planning the business plan that will be ready in the next month and EBITDA will be the result of many factors, what I can say today before factoring the job is that the cost of goods sold that we had in the past with the existing let's say distribution was in the area of 40%, and this is an improvement of some points -- important point, the target of 40% is something that probably is the first that we have in mind. According to those -- to that target of 40% cost of goods sold you can make your calculation. As per as working capital the improvement we had is quite substantial, if particularly better than the average of the recent years which has been above 20% so I don’t foresee with today supply chain structure any particular further improvement in the working capital. We will see in the future as soon as we should decide to change the production fraction of the company, if we can achieve an even lower working capital. Was I’m clear Mr. Rossi?

Yes, yes, yes, I see your point, and I have another question for Pasquale Natuzzi more on a strategic level, I remember last call, with this that you see, when you said that you see your company more and more as your own brand and less and less as a producer for others. And we start to see some of these results in this quarter perhaps, what is let's say due regarding next year in terms of order flow, how do you see the company developing in your private label space and going forward next year?

As we explained on our press release, the management now is focusing on how we can increase the volume, because yes the contribution margin on private label, it's lower than obviously Natuzzi brand but it's much -- but with the private label targeting a bigger customer that they generate the user volume, it's much easy to gain €20 million or €30 million growth and even with lower margin certainly helps the total balance sheet to be positive. So, so far we are focusing primarily on the private label but certainly we are getting more and more organized on the retailer division. So, for next year we are very much confident to see a growth improvement. Unless that something -- I mean you never know what up and look at France, look at Middle East, I mean we are in the middle of a concerning situation, but again the fact that we manufacture in China, in Romania, in Italy, in Brazil, we export -- we do less than 10% in Italy and then we are well distributing around the world make us feel confident about the future certainly. So, we see all improvement that would -- that's what sincerely we feel as a manager for the company, we will see just improvement, hello?

I'm very happy to hear your optimism and to see substantial improvement in result, because clearly in a turnaround situation, obviously you need to have this ability in the short term that keeps going on the momentum behind the management and I mean as a shareholder I can tell you that I'm happy to see some of these movement being visible.

Thank you, I appreciate that I mean the turnaround process is starting to give us some positive result, but we expect more and more.

Is there any in the sales of the previous quarter, is there any special trend in terms of products that are important to high side, meaning perhaps the Re-Vive, how is it going in terms of sales, what is the?

Re-Vive, we didn't -- Re-Vive it's obviously it's a product particularly, it's a recliner chair and today it is the top seller in our product line. So, Re-Vive is performing very well, the bed -- new collection that we introduced 18 months ago. It's performing more and more month-by-month. I mean we're very much confident, I mean new product introduction are giving us the result that we were expecting.

These were the products that you presented last year at Salone del Mobile or in other let's say fairs that are happening in the United States?

I mean the new -- talking about Re-Vive, the introduction was made let's say two years ago, okay, in October -- that was October 2013, sure in two years time we've been able to develop some around $10 million business that should be the result of Re-Vive this year. Regarding the bed, the collection, introduction was made at in April 2014, so and in 18 months we should say that we are performing more than what we were expecting.

[Operator Instructions] And it appears there are no further questions. At this time, I would now like to turn the call back over to today's speakers for any additional or closing remarks.

All right, okay. Thank you very much for attending our conference call and we wait for next one and deliver it to you a good news thank you. Thank you very much to everyone, thanks.

This does conclude today’s conference. We thank you for your participation. You may now disconnect.