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Good morning, ladies and gentlemen, and thank you for joining us for our third quarter sales presentation. We will follow the usual format and take you through the presentation and then give you a chance for some Q&A. So without further ado, over to you, Gilles.
Thank you, Julia. Good morning, everybody, and very happy to welcome you on this call, which is going to be my 36th and last quarterly financial communication. So looking forward to your questions in a few minutes. So let's start with the presentation. Continuation of very good sales diversified growth, 6.3% organic year-to-date growth, driven by emerging markets, up 13%; with a continued dynamism in the Americas, up 6%; and good performance in the U.S.A. and acceleration of Latin America; a very dynamic Asia-Rest of the World, plus 10%, thanks to confirmed return to strong growth in China, in India. And in India, it was partly favored by the low comp in Travel Retail and in Africa/Middle East. Europe was up 2% in the first 9 months, with a good momentum in Eastern Europe and stability in Western Europe with, on the one hand, good performances in Germany and U.K. but difficulties in Spain and in France.Q3 was strong, a 9.3% growth, enhanced by favorable phasing of Chinese New Year and, to a lesser extent, the timing of Easter. So in the -- those 3 months, we had a continued dynamism in the Americas, up 6%, was a good overall performance. Asia-Rest of the World was up 18%, thanks to a strong underlying performance, enhanced by favorable CNY phasing in China and cycling demonetization in India last year. We had in the quarter a modest decline in Europe, minus 1%, with the continued difficulties in Spain and France, together with an unfavorable shipment phasing in Russia and an adverse basis of comparison in the U.K.So we have on Slide 3 the key figures. So net sales, above EUR 7 billion for the first 9 months. And on Slide 4 are the different elements explaining the variation of net sales, so 6.3% organic year-to-date sales. Reported year-to-date sales were slightly up by 0.2% because of the adverse ForEx impact of EUR 408 million, minus 6%, in the first 9 months.On Page 5, you have the overview of the growth by region. As you can see, the acceleration is largely driven by Asia-Rest of the World, up 10% in the first 9 months, whereas it was up 1% last year.On Slide 6, you have the sales growth by key category. As you can see, the acceleration is driven by the Strategic International Brands, up 7%, whereas they were up 4% last year. So strong growth driven by Martell, Jameson and also the return to growth of Chivas. We also had some acceleration and some dynamic performance on our Strategic Local Brands, up 7%, whereas they were up 1% in the last fiscal year. It's largely driven by Seagram’s Whiskies, in particular, in India, where we enjoyed a low comp; but also the strong double digits of our tequila, Olmeca / Altos. The wine was stable in the first 9 months, with Campo Viejo continuing to deliver strong results. But we had some adverse phasing at the end of March in the U.K. and in Kenwood in the U.S. Q4 should be better.So let's go through the different regions, starting with the Americas, up 6%, end of March, with the U.S. up 3%. As we already said in our previous communication, the market has been decelerating versus the previous year, and we estimate the growth in value of the market to be between 3% and 4%. And Pernod Ricard is very close to that performance, so it's a good performance. And in a way, even if the market growth has decelerated in the U.S., our relative performance has improved as compared to last year. We have a strong momentum on Jameson; on Martell, which is gaining share in the U.S.; and on our tequila portfolio, Avión and Altos. Absolut is still in decline. Canada showed a modest decline in those first 9 months. Travel Retail Americas showed some growth acceleration versus last year, driven by Strategic International Brands, Martell, Chivas, Absolut and Jameson, in particular.And we had also a good first 9 months in Latin America with the return to growth in Brazil in an improving context, driven by our Strategic International Brands, in particular, Chivas, Absolut and Ballantine's, and also Passport; an improved performance in Mexico following our strategic refocus, also disposals and reorganization of the company; and a continued good performance in Argentina and in Cuba, thanks to increased tourism in Cuba.Asia-Rest of the World, up 10%, very dynamic, with significant acceleration versus previous year. China, up 19%, very good Chinese New Year, confirming the return to growth -- to strong growth, indeed. Strong growth for Martell across all price segments. Q4 expected to be weaker due to the tight management of inventories to ensure sustainable growth over the next years. Chivas has responded positively to the relaunch plan, but it's still too early to assess the success of the new approach, but a promising start, I would say. And very good performance of the whole portfolio of Premium brands, in particular, thanks to the new dedicated marketing and commercial organization we've put in place 18 months ago.India was up 14% with a good performance across the whole portfolio, enhanced by a favorable comp. As a reminder, demonetization had impacted Q2 and Q3 of the last fiscal year. The highway ban is now behind us. It's fully implemented, and we don't expect further disruption. We are awaiting clarification from GST council as to the scope of the application of that tax.Korea, still in decline due to Imperial, but trend is improving versus fiscal year '17, thanks in particular to the Strategic International Brands. Travel Retail Asia, 11%, quite dynamic, in particular, thanks to a very strong H1. H2 will be -- is weaker. We had the commercial phasing skewed to H1. And as for China, the Q4 is expected to be weaker for Martell due to our policy of tight management of inventories to ensure a sustainable growth of the brand in the next years. Dynamic growth in Africa/Middle East, driven in particular by Turkey. So we enjoyed a favorable comp there because of the coup d'état last year.Page 9. Modest growth in Europe, up 2%. So 2 difficult markets. First, France, minus 4%, a decline in the tough environment, in particular, for anise. We are in awaiting in that market, and we launched recently Ricard Plantes Fraîches. Spain, also minus 4%... The decline is due to the market deceleration. It has been amplified by destocking following the low summer and low Christmas. And it was also impacted by the Catalonia political situation. That created a decrease of the market growth by 1%... We also innovate in Spain, and we recently launched Beefeater Pink. Germany, up 6%, continued dynamic growth, enhanced by a favorable basis of comparison. We had some commercial conflicts last year, and there's also the positive phasing for Easter. And we also had some price increases. There is, in particular, a strong development of the aperitif segments, in particular, with the brand Lillet. U.K., up 3%. It's a robust underlying dynamic with market share gains. Q3 was in decline due to unfavorable comp. There were some stock-loading end of March last year prior to some price increases. Travel Retail Europe has shown some improvements, linked in particular to the return of the Russian travelers. And Russia was up 10%, so we continue to have a strong underlying performance. Q3 was weak due to some unfavorable shipment phasing. We also want to highlight the renewed geopolitical tension with some new economic sanctions against Russia, which led to some weakness in the currency, the ruble.So Page 10. A very strong year-to-date sales with acceleration versus fiscal '17, in particular, in China, India and Global Travel Retail. As we said, we expect the Q4 to be negatively impacted by lower market sales. We want to have a tight inventory management to be able to ensure growth sustainability. Also, Q4 was also -- to a lesser extent, will be also negatively impacted by the phasing of Easter. For the full fiscal year '18, we expect a strong and diversified sales growth; some limited operating leverage. So yes, the pricing has started to improve versus fiscal year '17, and we keep benefiting from the ongoing focus on operational excellence. But we also have to deal with some adverse impacts, like the GST in India and the strongly rising agave costs.We have abated the negative ForEx on the operating profit from recurring operations. Our last estimate is a negative impact of EUR 200 million for the full year. We confirm the fiscal '18 guidance at the top end of the range, with an organic growth in profit from recurring operations close to 6%. Slide 11. We also announced an evolution of our dividend policy. Due to profit growth acceleration and deleveraging in the last 2 years, Pernod Ricard's Board of Directors is recommending an inflection of its dividend policy, obviously, subject to the AGM on the 21st of November 2018. And the objective is to have a dividend distribution to progressively increase over the next 3 years to circa 50% of net profit from recurring operations starting, obviously, this year. As a reminder, our historical policy of distributing dividends was 1/3 -- close to 1/3 of net profits from recurring operations. We obviously remain committed to value-creating M&A while retaining an investment-grade rating. So thank you for your time, and I think it's time now for your questions.
[Operator Instructions] We do have our first question from Simon Hales from Citi.
Three questions, please, Gilles. Firstly, I mean, can you just talk a little bit more about the phasing impacts in Q4, maybe particularly, again, explain what's happening with that tight inventory management around Martell? Is any of that to do with the pricing you're taking on that brand. At the moment, it's been, so maybe more of a buy-in in Q3, and therefore, we're going to see some impact of that on Q4. Secondly, I wonder if you could just talk about the U.S. I mean, you flagged and you've seen for a while the slowing general market backdrop. What do you think is driving that? I'm interested in your thoughts there. And then with regards to Absolut, which you said was still down in the period, what have you seen in terms of consumer reaction to the Nothing to Hide campaign? And then just finally, on FX, can you give us any indication at all as to how we think -- should think about FX for fiscal '19 now, Gilles, given that's -- we're rapidly approaching that? So I think if we look at consensus estimates, consensus is expecting just a EUR 34 million EBIT headwind from FX next year. Are you comfortable with that?
Well, thank you for your questions, Simon. First question, on the phasing impact in Q4 and what we said on Martell, what we want to do is to be able to deliver sustainable growth on Martell this year and the following years. What do we target? Low double-digits growth in value top line for Martell for both this year and the following years. And to date, at the end of March, the Martell growth is above that trend. So I think it's very important for us to limit the volumes so that we can ensure a sustainable and regular growth pattern over the next years. So it's not directly linked to the pricing even if, obviously, with that strong demand on Martell, we have decided to increase prices, and most of the price increases took place in the second half of the current fiscal year. But most of the impact of that pricing increase will be next year. So you -- we could expect, let's say, in the repartition between volume and value growth on Martell, you could expect this year to have maybe a stronger growth in volume as compared to the next years. But the price/mix, the following years would be a bit higher than what we have in fiscal year '18. In the U.S., yes, there is a slowing market. It has been the case for now 12 months. Consumption as a whole is a bit less dynamic. It's not just specific to spirits. So we observed some prudent consumer behaviors. We know also that the growth is a bit heterogeneous, and it's stronger for the high-end products. It tends to be less strong for the standard brands. So by the way, it's good because premiumization is still very much alive. At the same time, pricing is almost nil today on the markets. So nothing really worrying. I think that we are well positioned because we are well exposed to Premium brands. Jameson is still quite strong. The launch of Caskmates is a success. The launch of IPA is very promising. And Martell is gaining share; from a low basis, we're gaining share with Blue Swift and VS Single Distillery. The tequila portfolio is doing quite well. Absolut, yes, is still down, but at the same time, I think all we've done has been well received. The brand indeed has the relative performance as compared to the other premium and super premium vodka brands, which is not so bad. I mean, we outperformed many of the brands; not all of them but many of the brands. We have not been able to stabilize the brand at this stage in an environment which is probably tougher than what it was 2 or 3 years ago. But I think we are doing the right thing, and clearly, the campaign Absolut has Nothing to Hide has been well received. There've been highlights as the transparency of the brand, the quality of the product, the authenticity of the product, of the brand, and this is what we need to keep doing going forward. In terms of ForEx, I think it's too early at this stage to give you a flavor for next year. We'll do it in our next communication. What I can tell you is that the assumption we took for the parity euro-dollar for the full fiscal year '18, so as part of this EUR 200 million negative impact on operating profit, is roughly 1.20. And the current spot rate is 1.23. I think we communicate every 6 months our exposure to the currency fluctuation, so I think you should be able to make your own estimate based on that.
Okay. And just going back to the phasing, Gilles. Just can you help us at all think about how much of an impact on Q4 specifically the timing of Easter, maybe the Russian phasing changes as well as the inventory management you're having on cognac will impact on the Q4 sales number?
Well, I won't quantify the Q4 top line objective. What I can tell you is that we had 6.3% top line growth at the end of March. And at the end of June, we'll be below that. And I think this is quite consistent with our updated guidance, close to 6%, with the mention that we'll have a limited operational leverage for this year.
That's pretty, Gilles. Many thanks for all your interactions as CFO over the years, and all the best in your new role.
Thank you, Simon.
We will now take our next question from Olivier Nicolai from Morgan Stanley.
Gilles, just a couple of question. First of all, in your guidance, could you please quantify the adverse impact from GST and agave cost inflation? Are those the only driver to explain the lack of operating leverage? Or should we also expect marketing as a percentage of your sales to increase year-on-year? And the second question is actually on France and on your new product, Ricard Plantes Fraîches. I was just wondering, what are you targeting in term of consumer? And how much cannibalization do you expect with the Ricard brand, which is, I think, from memory, about half of your sales in France?
Thank you, Olivier. So the GST impact on fiscal year '18, as announced at the beginning of the year, is estimated to be 15, 1-5, million euros on the operating profits. We mentioned in the -- in our communication that we still await clarification from the GST council as to the scope of GST because there could be a risk that it could be extended also to wet goods. So I think at this stage, we are waiting for clarification on that. But the impact we have for this year, it's EUR 15 million. And for the agave, within the last 2 years, we had a hit of almost EUR 25 million over the last 2 years, so that's a significant impact that, yes, penalized, I would say, our COGS evolution in that period of time. You also had a question on the A&P to net sales ratio. I think our objective is to keep it more or less stable over years. It doesn't mean that it couldn't be slightly up or slightly down in a specific year as compared to a previous one. We clearly want also to keep some flexibility to invest behind our best opportunities, especially at the time of a stronger growth acceleration. But overall, we believe that we have the right A&P to net sales ratio to be able to keep delivering the type of growth that we've had so far. The launch of Ricard Plantes Fraîches, I think, is -- the objective is to create some newness around the Ricard brand, which is a quite traditional brand in France, to attract connoisseurs to the brand franchise, with leveraging also the new trend of fresh products, natural products. So this Plantes Fraîches should bring that. It will be sold at a higher price point than the core Ricard, 20% above, so it's also positive for the margins. So yes, potentially, we could have some cannibalization, but we mainly expect that, again, to bring some newness, be positive to the brand equity of Ricard and also potentially bring new consumers to the brand.
I'm looking forward to try it, and all the best for your new role.
Thank you. Try it with 7 volumes of water for 1 volume of Ricard Plantes Fraîches; whereas for core Ricard, we suggest 5 volumes of water. We want it to be more diluted and more fresh for Ricard Plantes Fraîches.
We will now take our next question from Sanjeet Aujla from Credit Suisse.
Gilles, 3 questions, please. Can you just let us know what Martell is running at year-to-date? And when you're talking about the sort of low double-digit value growth ambition over the next few years, how do you see that splitting between volume and price mix? Secondly, on India, I appreciate you had some easy comps, but have you seen any impact from distributor changes in the period? And thirdly, just on Spain and France, those markets continued to be weak in the period despite some of the destocking that you saw in H1. Can you just elaborate on some of the underlying trends there? And would you expect any improvement going into Q4?
Well, we won't disclose the year-to-date top line growth for Martell. What I can tell you is that the objective is to be low double digit in value this fiscal year and the following years. Let's say, at the end of March, we are above this low double digits, and we are, let's say, above 15%, to make it simple. We would expect, going forward, the volumes to grow high single digits starting fiscal year '19. And so the difference between high single digits and low double digits being the price and mix, price should be positive because of the price increasing we've done and we're doing; mix could be slightly negative because of the objective to make the brand more international, to grow it in the U.S., in Africa, in Eastern Europe, and so we could have a slightly negative mix. For this year, we would expect the volume growth to be a bit higher than the high single digits, but the price and mix maybe to be a bit lower than what we expect for the next years. In India, you're right to say that there are frequent route-to-market changes in different states, and some of them were possible in a state like Haryana, in particular, and Punjab, nothing has happened so far, but we are still obviously monitoring the situation. And whenever there is a distributor change, it can create some short-term volume disruption. Spain and France, yes, I mean, the performance is weak. Our underlying trend is a bit better than the minus 4% we posted in both markets. We estimate that in Spain, we -- the underlying decline is more 1%. And in France, it's more 2%. That said, these are still negative figures. I think that in Spain, after the good rebound we saw 2 years ago, following 7 or 8 years of crisis, there is some stabilization taking place. People seem to buy more durable goods rather than consumer goods. That's a trend that we've seen recently. And the year was also impacted by the issues in Catalonia and also by the very, very hot summer. But very clearly, the market, which had grown 3%, even 4% after the 7, 8 years of crisis, is not growing anymore at that pace, and we would see the market to be close to stability over the next couple of years. In France, the market is not growing very strongly, but we are losing share today mainly because of the difficulties we have in the anise category. And as you know, we are quite exposed to that category. That's also why we need to innovate, and the launch of Ricard Plantes Fraîches, sorry, is an attempt to innovate and bring some newness. We also need to deal with the deflation that take place in France and affect all consumer goods. Hopefully, with the new regulation that could come, there could be some more limitation to the depths and the frequency of the promotion that retailers impose to us. But -- well, this is something that we need to monitor in the next few months. So we have especially [ routes-to-market ] is a bit tough at this stage, but we are working hard on the portfolio management, on innovation and on our commercial organizations to be able to improve that going forward.
All right, great. Gilles, all the best for the new role.
Thank you.
We will now take our next question from Edward Mundy from Jefferies.
Gilles, I've got 2 questions. The first is kind of a big-picture question. And I guess, over the last 30 quarters or so since you've been doing these calls, you've seen at times Pernod grow as much as 8% at the group level for a year to as low as 0, depending on the cycle. And at the current point in the cycle, and without giving guidance, I was wondering whether you'd be able to share with us where you think Pernod is in the current, yes, part of the cycle. Are we at peak growth at around 6%? Do you feel that's sustainable? Or do you feel that because the source of growth at Pernod are more diversified, both regionally and by product than historically, there's still a further potential leg-up in growth? That's the first question. And the second is around the dividend. Should we view this as more of a catch-up relative to peers? Or should we read more into it in terms of confidence in growth and the confidence that you've delevered quite a lot? And also a comment on sort of M&A, either the lack of major transformational M&A moves?
Okay, so thank you for your question. On the first one, I will not quantify, at this stage, midterm, long-term trend that we could see on Pernod Ricard. What I can tell you is that, in the past, if you look at the organic top line growth of Pernod Ricard on average since 2000, I think it's close to 5%. So that's the historical trend that we've had so far, and obviously, it depends a lot on the economic cycles, which can be also different for mature markets, for emerging markets. But -- and we happen to be today, at the end of March, at 6.3%., so we are not miles away from the historical trend, a bit above. So clearly, we are seeing some inflection this year with some acceleration as compared to the previous year. But let's say that when we were growing at 1%, 2% or 3%, we were not at the level of growth that we were expecting, for sure. And I think that being a leader in countries like China and India is definitely, we believe, a competitive advantage. We have always said that. Apparently, people notice it's a bit more this year than in the previous years, and that's just great. So on the dividend, is it to catch up? Is it because we are confident? I think, well, we have deleveraged a lot the company in the last years. We have accelerated our growth. The leverage, net debt-to-EBITDA ratio at the end of December was 2.9x. We believe that it was just the right time to start to increase the payout ratio because we are getting very near from our optimized financial structure. So I think it's a logical, financially wise decision. Does it show confidence? Well, I would say that you can assume it gives some confidence because we have accelerated the growth, and we had deleveraged the company, and our intention is to keep delivering strong growth and to keep delivering strong cash flow going forward. There is no read across in terms of our M&A strategy, seeing no change of -- on that. We remain open to value-creating M&A opportunities. As it was the case in the past, we'll keep having an active management of the portfolio. We want to seize those new opportunities in new occasion or consumption, new dual brands, to address and to recruit new types of consumers. We have, obviously, year-after-year a stronger balance sheet. That makes us, I would say, more able to do acquisitions. But there is no change in our policy. So again, increasing of the dividend was a logical step after the very good deleveraging and growth acceleration we've had so far. And no change for our M&A policy. No change either with the fact that we want to remain an investment-grade company.
We will now take our next question from Trevor Stirling from Bernstein.
Gilles, 3 questions from my side, please, Gilles. Gilles, you've referenced the pricing on cognac. One, can you give us some indication of the scale of the price increases that you've been putting through in this half? Second question, you've said that Chivas was actually back in growth. I was wondering which countries had been the swing factor that put the brand back into growth. And the third thing, relating to currencies, Gilles, given the primary access of currency is the euro-dollar rate. But is sterling an important element of that as well? Is the strength of sterling putting a squeeze on scotch margins?
Thank you, Trevor. So on pricing, most price increases take place in the second half of the fiscal year. On average, these are mid-single digits increases. They can be different, depending on the SKUs, depending on the countries, but we try to make it consistent across all geographies. So most of the impacts of that will be next year because those price increases in China, for instance, were implemented after we had done the shipments ahead of the Chinese New Year. So most of the year is already -- was already behind us when we made those price increases. As far as Chivas is concerned, yes, it's back to growth, and that's a clear inflection as compared to previous years. China has been a key driver for that improvement, for sure, because the brand had been in a significant decline in the previous year than, clearly, the new platform we have there, the strong investment we've put behind the brand, the partnership with the NBA is delivering there. And it's the #1 market for Chivas, so it has an impact on the change in trend. I could also highlight the performance of the brand in Russia, Travel Retail in the Americas and Turkey, where the brand has accelerated its growth. For the rest, it remains strong in Europe. It remains relatively weak in the U.S. In terms of currencies, yes, the parity euro-dollar is by far the one we are most exposed to. There are other important currencies, but first of all, the emerging market currencies because we have more than 40% of the net sales of Pernod Ricard in emerging markets. And not all the currencies are linked, even less pegged to the dollar. Even the renminbi is less and less linked to the dollar. So we also need to deal with both emerging and market currencies evolution. Yes, you are right to say that the sterling pound is also an important currency because the business that come from the U.K., scotch and gin, represent a bit more than 25% of the group activity, so we are quite exposed there. The impact this year as compared to last year is very limited on the sterling pound as it has more or less stabilized in the last 12 months. Obviously, going forward, if the pound got weaker, that could be -- that would be good news for us because, as I said, we export 25% -- 25% of the group business is coming from the U.K., whereas the domestic market only represents 2% of the group net sales, so we are a net exporter. And as a consequence, when the pound is weak, it's good for Pernod Ricard. But no major impacts this year at this stage.
Gilles, thank you for all the thoughtful responses over the years.
Thank you, Trevor.
We will now take our next question from Nico Von Stackelberg from Liberum.
I just want to ask about inventories in China for Martell. How many days of inventories are in the pipe? And I also want to ask about shipment first depletions in China for Martell. If you could give some more color on that, please, that'd be great.
Well, inventories in the trade worldwide, overall, I would say, are sound, so as -- same as in the previous years. Inventories in China are also quite sound. It's true that with the very strong acceleration of Martell, we'd probably land at the end of June with the number of days of inventory that could be lower than just 60 days that you know we have been referring to in the last years. But that won't be, I would say, a massive difference. And I think if we have too low inventories in China, then the risk is to have some sales disruption, which, obviously, we want to avoid. And don't expect a big difference between shipments and depletions. So we posted the 19% growth in China for the first 9 months. It will be lower than that at the end of June but mainly because of the tight management of the shipments of Martell in Q4 for the reason that I mentioned before. So we'll grow double digits in China this year, for sure, but we'll land at a lower level than the 19%. And the figure you'll see at the end of the year will probably be a good indication of the underlying trend that we see on our business in China.
We will now take our next question from Chris Pitcher from Redburn.
A couple of questions, I'll keep them short. In terms of Martell in China, can you give us a sense of the growth rate by the different qualities? And then if I look at your China number, you went from 8% growth in the first half to 8 -- 19% in the 9 months. Can you confirm the scale of the growth in the third quarter -- forgive me if I missed it earlier -- and explain if there are any sort of one-offs within that? I mean, how much of that was the Chinese New Year, just to help seasonality next year?
Okay. So the first question is on the growth of Martell by SKU with China. Well, the good news is that everything is growing. By the way, not only Martell is growing in China; all brands that we have are growing, Chivas, the Premium brands, and that it's good to see that the brand is starting -- the growth in China is getting more diversified, more channels, more brands. It's far more balanced than what it was 6 years ago before the crisis we had there, which I think is a positive piece of news for the sustainability of the growth going forward. Back to Martell, Cordon Bleu is growing; XO is growing; L’Or de Jean Martell is growing; Noblige is growing; the Distinction also is growing. So everything has gone back to growth. It's in off-trade and in off-trade (sic) [ on-trade ]. And clearly, part of the acceleration this year comes with the fact that the on-trade is back to good growth. So the whole range has, I would say, benefited from that rebound. And from that, I think very good work which has been done on the Martell brand franchise. I won't enter into too many details on our Q3 figures by brand or by country. What I can just tell you is that if you were to restate the Q3 figure by the later Chinese New Year, the growth would be close to 7% in Q3 for the group.
The group as the Pernod Ricard? Yes, but how about the difference?
Yes, of the group -- as a group Pernod Ricard, exactly. And then for the rest, as I said, China is at 19% at the end of March. It will be lower than that at the end of June, but it will be a clear double-digit growth in value. And this clear double-digit growth in value that we have in China is -- I think, will reflect the underlying trend that we have seen this year on our business in China.
We will now take our final question from Hermine de Bentzmann from Raymond James.
Most of my questions have been answered, but a very quick one on the price/mix and volume split for the strategic brand, please, in Q3? And my other question will be on Europe. Considering your launch in France and the easy days of comparison in Q4, can we expect this region to accelerate in the last quarter of the year?
Thank you, Hermine. On the price and mix, so I will make a more global answer, not specifically on Q3. But year-to-date, the price and mix on the whole portfolio is close to 2.5%, which is more or less the level that it had last fiscal year. It's more driven by mix than price, but price is getting better as compared to last year. And hopefully, it will amplify going forward because of the price increases we've done, in particular, on Martell in the last few months. In Europe, we expect Q4, that should be better than Q3. Then for the rest, I think the 2% top line growth that we've seen at the end of March is probably a good indication of the type of growth that we see for the region for the full year, which should be miles away from that.
Okay.
Thank you.
Thank you very much, Gilles, for this call and for the past 36 [ efforts ].
Thank you. Thank you, Julia.
Ladies and gentlemen, thank you very much for joining us. Adam and I remain at your disposal should you have any questions.
This concludes today's call. Thank you for your participation. You may now disconnect.