Peter Warne - Paul Bulcke - Chief Executive Officer, Member of Executive Board, Director and Member of Chairman's & Corporate Governance Committee Wan Ling Martello - Chief Financial Officer, Executive Vice President and Member of Executive Board Steffen Kindler - Heiko Schipper - Member of the Executive Board and Deputy Executive Vice President of Nestlé Nutrition

James Targett - Berenberg, Research Division Jon Cox - Kepler Cheuvreux, Research Division Alan Erskine - UBS Investment Bank, Research Division Alex Howson - Jefferies LLC, Research Division Gerry Gallagher - Deutsche Bank AG, Research Division Warren Ackerman - Societe Generale Cross Asset Research Celine A.H. Pannuti - JP Morgan Chase & Co, Research Division

Good morning, ladies and gentlemen. Welcome to our Full Year Results Conference here in Vevey. This conference will be held in English, but you can also follow it in French or German using the headsets provided. If you're watching the webcast, you can choose the right language by clicking on the respective link on the webcast page. I take the safe harbor statement as read. Now let's start. Paul, you have the floor.

Good morning, everybody, and also welcome to our 2014 Full Results Conference. I, first of all, want to thank you for your interest. I want to also say hello to the people who are following us via the webcast. With me on the podium, we have -- I have Wan Ling Martello, our CFO. In the room, we have also, in the first row, my colleagues of the executive board; and also Greg Behar, who's leading and heading Nestlé Health Science; and Humberto Antunes, who is heading Nestlé Skin Health. They're here in the room to be also available for questions that you may have at the end of our speeches. You saw, we have published our results for 2014 a few minutes ago. And I would say, they are solid. They are solid in the sense that, first of all, they are delivering on top and bottom line. Secondly, also, they have been built upon delivering over the years, also over the last years. And they have also been delivered in a soft trading environment. There's enough talk about that in the press. And -- but also, and very importantly, they have outperformed the market. And I would say, they show something that I'm going to comment later on which is some intrinsic, I would say, differentiating strengths of our company. And the first thing I want to say there is the commitment and -- of our people everywhere in the world, our people, how they are committed, aligned behind our strategy is an intrinsic, very, very strong element of our continued success, I would say. Then also, our global footprint. We have truly -- we are truly a global company that have enhanced activities, integrated activities in every part of the world, and that is definitely a strength. And then also, our portfolio and our brands and the complementarity of the different categories we are working in is also very important. And then what is driving this portfolio is our R&D and our innovation drive. These are 4 elements that I would say are at the base of the success of last year and the years before and will be also at the base for the future and I'm going to go a little bit more in detail. You saw the figures, and I want to ask now Wan Ling to walk us a little bit more through the details of what's behind these figures. So Wan Ling, please, the floor is yours.

Thank you, Paul, and good morning, and good afternoon. I would like to first start by wishing all my Chinese friends and colleagues a very Happy Chinese New Year. It is today. So [Chinese]. Not to worry, I'm not doing this session in Chinese. So...

You've seen, I put on my red tie.

I know. He did something for me today -- just today. Looking back at 2014, it was indeed not an easy year. I have to say that I am proud of the group's results. So let us start by taking a look at our highlights slide. We have sales totaling over CHF 91 billion. Our 2014 organic growth is made up of 2.3% RIG and 2.2% pricing. This is good performance and represents 2 things: first, our ability to sustain growth, like Paul said, year after year in very difficult markets. We focus on the value of our brands, driving innovation, premiumization and engaging effectively with our consumers. Second, the group's ability to offset areas of weaker performance, areas that we're keenly aware of and are in the process of addressing, something I will cover more in our zone review. In addition, this growth has been delivered while improving our trading operating profit, up 30 basis points in constant currency. Our operating cash flow of CHF 14.7 billion has to be viewed with the comments I made in 2013 as well as in 2014. We have had 2 years of remarkably strong performance, so 2014 was again a good year. Finally, our underlying profits -- our underlying earnings per share were up 4.4% in constant currencies. With that in mind, I would like to now turn to the details behind our performance, starting with our regional growth. Our regional organic growth, that is our zone and globally managed businesses, together, was 5.4% in Americas, 1.9% in Europe and 5.7% in Asia, Oceania and Africa. Real internal growth was 2.3% in Americas, 2.4% in Europe and also 2.4% in AOA. This performance is representative of a whole host of factors affecting our markets around the world, whether it's the deflation affecting pricing in Europe, a moderate improvement in North America, a more subdued Latin America or the slowdown we have seen in the Middle East and China affecting AOA in the latter half of the year. Looking at our global presence from the developed and emerging market perspective. Emerging markets delivered 8.9% organic growth; sales totaling CHF 40.2 billion, which is about 44% of our group. This solid 8.9% growth is slightly below where we were last year. It reflects the challenges we face in some key emerging markets. Developed markets delivered 1.1% organic growth, sustaining a performance that, quite frankly, is very good. Let's now turn to our performance from a zone perspective, beginning with Zone Europe, with sales of CHF 15.2 billion, OG of 1.5% with 2.2% RIG. I know we have said this before, but the strength of the zone comes from innovations and premium products we have brought to the market. This is clearly reflected in market share improvements. I don't need to tell you that the trading environment in Europe remains quite intense with deflationary pressures making it very difficult for pricing and consumer confidence continuing to be fragile. Having said that, both Western and Eastern Europe continued to grow. PetCare, Nescafé Dolce Gusto and frozen pizza had good performances across the zone. In the West, France, Austria and The Netherlands had good growth, all 3 markets benefiting from Nescafé Dolce Gusto. In France, Herta in chilled culinary and our frozen pizza business and Fresh Up and Buitoni Fiesta varieties both had a good year. We also had the successful launch of Les Recettes de l’Atelier chocolate. I was afraid I might mispronounce this, so I'll show-and-tell here. Very good product, very good chocolate. So that was -- that's doing really well, especially in a challenging confectionery category. It's also worth calling out that Spain and Portugal, we saw some recovery. Coffee, particularly Nescafé Dolce Gusto, led the growth, no surprise, with frozen pizza, snack noodles and ambient culinary doing well, too. The Great Britain region, Germany, Italy and Greece remained challenging markets for us. In Central and Eastern Europe, the growth was driven by Russia, although we did see a slight slowdown towards the end of the year. The largest categories, coffee, confectionery and ambient culinary, all had very good performances, Nescafé Gold, KitKat and the launch of Papyrus cooking papers being standout performers. Ukraine also delivered good growth despite the challenges that the market is facing, driven by confectionery, especially KitKat. Overall, across the zone, PetCare remains the strongest growth driver. As a category, it is one of the best examples where differentiated, value-added, premium products can sustain growth in tough market conditions. Some of the strongest performances come from brands like Felix, Purina ONE, Gourmet and our snacks range. The zone also continued to invest in the future. A few examples include expansion of our Nescafé Dolce Gusto factory in Tutbury, U.K.; a capsule factory in Germany; and a PetCare factory in Poland. The zone's trading operating profit margin was 15.3%, up 30 basis points. This reflected the zone's ongoing efficiencies and a general reduction in structural costs. Looking now at Zone Americas, the zone achieved 5% organic growth with 1.1% RIG. Starting with some of the macroeconomic, macro environment dynamics for the zone. It is fair to say that the various indicators do show an improvement in consumer sentiment in North America towards the end of 2014. In addition, the lower oil prices may help the consumers. We will have to see how this plays out in 2015 and how any improvement actually translates into the F&B sector. In comparison, Latin America's economic environment continues to slow down. Now looking at our performance. In North America, our growth was slow with relatively good performances in PetCare, coffee creamers and super premium ice cream. This growth was offset by the continuing contraction of the frozen category and further declines in premium ice cream. Now I do realize that we've been speaking about the issues in the U.S. frozen food category for some time. Now for those of you who have seen what we presented at our Investor Seminar in Boston just a few months ago, what we discussed there remains relevant. Building on that, I'd like to share with you some more specificity of the plans we discussed in Boston, particularly for Lean Cuisine. We are systematically changing all the elements. We are improving the segmentation of the ranges with new consumption occasions like snacking. We're making the portfolio more relevant and reflecting the needs and wants of our consumers, so more natural, organic, gluten-free, more protein. We're fully embracing digital across all of our communications. And more importantly, the changes we've been working on for several months will make our Nutrition, Health and Wellness promise, NHW, consumer-relevant, producing as fresh and natural as is possible and keeping the recipes as simple as possible. Now of course, this relaunch comes with investment both in our operations and, particularly, in consumer marketing spending. Let me be clear, there is a lot of work to be done here. Our expectations are that we should see some recovery over the course of 2015. In frozen pizza, the category dynamics, in addition to our pricing, led to a disappointing slowdown. This was despite the innovations we brought to the market. Our California Pizza Kitchen brand did relatively well, particularly with crispy thin crusts. Looking at ice cream's performance, the premium segment remained under pressure. I can tell you, though, that the super premium segment did well with Häagen-Dazs Gelato. Our snacks business, that includes Drumstick and Outshine bars, recovered nicely also. In confectionery, the growth had a slow start due to the tough comparisons and general trading conditions. The ongoing successful rollout of Butterfinger Peanut Butter Cups continued to be one of the key drivers of growth. Coffee-mate maintained its growth momentum, helped largely by seasonal flavor innovation. Natural Bliss, our all-natural dairy-based creamer, had another good year and remains a platform for future growth. We also had a successful launch of Coffee-mate 2GO, concentrated creamer in handy, pocket-sized bottles. Innovation also ensured the PetCare business in North America to continue to grow well. Dog Chow, Pro Plan and Lightweight cat litter were some of the highlights. The brand, Beyond, was an important -- had an important launch in the fast-growing natural segment. Now moving on to Latin America, there was good organic growth helped by pricing that's reflective of inflationary pressure. Consumer sentiment varied across the region. And yet, most markets did well. All of Nestlé Brazil's categories grew. Double-digit growth in coffee, largely thanks to Nescafé Dolce Gusto; Ninho in growing-up milks; KitKat in confectionery; Nesfit in biscuits; and Nescau in cocoa and milk beverages also made very strong contributions to the market's performance. In Mexico, the changes in fiscal legislation did affect consumer sentiment. Nido, Nescafé 3in1 mixes, Nescafé Dolce Gusto and Carnation were some of the biggest growth drivers. Across the Latin America region, PetCare delivered a broad-based growth. It is now a meaningful-sized business for us in the region. Dog Chow, Pro Plan were again the main drivers of growth. We also had a successful launch of our Revena natural dog food in the specialist channel in Brazil. In terms of trading operating profit, despite higher input costs, the zone's margin improved by 60 basis points to 18.8%. This improvement was thanks to many factors: lower restructuring costs; the nonrecurrence of the Waggin' Train withdrawal in 2013, if you'll recall; and ongoing operational and structural efficiency gains in pricing. Altogether, this offset input cost increases. Moving to Zone Asia, Oceania and Africa. At the 9 months, we talked about a slowdown in AOA compared to where we were at half year. While it is clear that with 2.6% organic growth for 2014, all driven by pricing, the zone has faced more challenges as we close the year. We had particularly weak performances in China and Oceania. There was also a slower performance with a high level of growth last year from -- in the Middle East. We did, however, see good growth in many emerging markets. This includes the Philippines, South Asia, the Indochina region, Turkey and Africa. As we have mentioned before, China has had some specific challenges. Let me share with you a little bit more color as to what is happening there beyond the macro factors that others have talked about. There are important differences between the performance of our categories. Now please bear in mind that we are only looking at our zone businesses here. Our globally managed businesses, which are infant nutrition, Nestlé Waters and Nestlé Professional, all had solid results in China in 2014. Our largest category in China in F&B is ambient dairy. Yinlu had a tough year. We significantly reduced the level of stock in the trade to ensure freshness on shelf. As you can imagine, in an intensely competitive market, this had an impact on growth, especially with peanut milk. In contrast, our country [ph] product had a resilient performance. Our portfolio of premium senior milk powders also continues to do well, catering to those consumers looking for products that help bone and heart health. Ambient culinary in China grew despite the tough comparisons in 2013. The Thai Tyler [ph] brand again delivered a strong performance. In coffee, our ready-to-drink Nescafé smooth latte also finished the year well despite tough comparisons last year. For soluble coffee, the category growth is slower. We do remain the largest player in soluble coffee in China. The reformulations of Nescafé, such as extended café-style Nescafé Collection, should stimulate the category. Now moving on to confectionery, in 2014, we do see a declining Chinese wafer category, compounded by our destocking and some pricing towards the end of the year. As we have mentioned before, the reduction in gifting in China had an impact on Hsu Fu Chi. We are continuing to move our portfolio in line with the changing preferences of the Chinese consumers and driving more of the nonseasonal business. Ice cream closed the year in positive territory in China, now albeit at a slightly slower rate than last year. As we have highlighted before, the softening we have seen in China in food and beverage is not yet showing signs of real improvement. During 2015, we will continue to drive changes in our portfolio relevant to the needs of the consumer. This is not something that will happen overnight. However, the long-term prospects for our businesses in China remain positive, especially given the demographics, the growing urban population and the products and the brands in our portfolio and pipeline. Oceania's challenges are a little different in the form of a very difficult trading environment. We continue to develop new trade channels and accelerated the rollout of innovations, the best example being Nescafé Dolce Gusto that continued to do very well. Japan benefited from the launch of premium KitKat via the Chocolatory boutique concept and the ongoing rollout of Nescafé with micro-grains. I am very proud of the growth we have seen in Japan, and it is a testament to the ingenuity and the passion of my colleagues in Japan. Finally, for Zone AOA, the trading operating profit margin was 18.7%, down 20 basis points. This was mainly due to various trading items, including restructuring. While increases in input cost, largely caused by depreciation in local currencies, they were offset by pricing and efficiencies. Moving now to our globally managed business. First is Nestlé Waters. Let me take a sip of water. Quality H2O, healthy hydration. Our business has improved steadily over the last years by focusing on valuing up the portfolio. Yes, the category growth has helped, especially in North America and in emerging markets. But it is our drive to continuously improve our structural cost by leveraging our growth that has had the greater effect. For 2014, Nestlé Waters had 5.4% organic growth with 6.3% RIG. The growth was broad-based both in terms of geography and our portfolio and benefited from the global category growth. In the developed markets, pricing remained difficult, no surprise, and our largest market, the U.S., remains highly, highly competitive. Across the emerging markets, the double-digit rate -- the double-digit growth rate was sustained with a very strong RIG contribution. Nestlé Pure Life continued to be a growth engine, particularly in the emerging markets, but also in the North -- in North America and in the U.K. Our strong local brands maintained their momentum and delivered good growth. Highlights were Buxton in the U.K., Erikli in Turkey, La Vie in Vietnam, all with double-digit growth. The premium international brands, Perrier and San Pellegrino, had a very good year, clearly demonstrating our ability to drive value in this category. Trading operating profit margin was 9.7%, up 50 basis points, mainly driven by leveraging solid RIG on the back of continued structural cost. Lower input costs were partly offset by higher distribution costs. Moving on to Nestlé Nutrition we had a 7.7% organic growth and a 3.6% RIG, a strong result given the tough comparisons in 2013. From a geographic perspective, there was double-digit growth in AOA despite disruptions in many markets due to political unrest. Latin America also had a good year with many markets contributing to a solid growth rate. North America and Europe were more challenging, resulting in relatively flat growth. Infant formula continued to be the key driver with double-digit growth. We continue to invest behind our brands. Our super premium line, Illuma; and the premium products, NAN and S26, were again the highlights. Many markets delivered very strong growth, including China, the Middle East, Indonesia and the South Asia region. Happy to report that Wyeth infant nutrition had another good year. In baby food, infant cereals saw a steady recovery in the U.S. with strong contributions also coming from Brazil, Central and West Africa and Pakistan. The organic fruit purée pouches for infants, combining good nutrition and convenience, were a highlight for meals and drinks in the U.S. Despite pressures coming from higher input costs, trading operating profit margin increased 80 basis points to 20.8%, and this was driven by a combination of active portfolio management, a solid performance in Wyeth Nutrition and efficiencies across the value chain. Moving to -- moving on to other businesses, we achieved 7.1% organic growth and a 5.6% RIG. Nestlé Professional had relatively good growth, especially when you consider the very challenging out-of-home environments in both Western Europe and North America that, together, represent over half of our business. Not surprisingly then, the growth was driven by the emerging markets, with China, Philippines, the Indochina region, the Middle East and Russia. The beverage solutions continued to perform well, and this was helped by the rollout of new technologies behind our Nescafé Alegria and Nescafé Milano machines. Dessert solutions also had a good growth. Moving on to Nespresso. Nespresso grew in all regions. Our ongoing focus on quality and the many investments we made and continue to make in products, machines and services delivered strong results. As I reported at our last call, the successful launch of the VertuoLine system in North America is creating a new premium coffee segment, and we're very happy with the progress so far. Nestlé Health Science growth was primarily driven by strong performances in Europe. We continue to drive new innovations across the portfolio, for example, new products in our Vitaflo business in the U.K., a new Boost model in Canada and the Meritene range in Europe. Last, but not least, Nestlé Skin Health had double-digit growth with strong performances in all businesses and geographies, particularly in the Americas and in Asia. The trading operating profit margin of other businesses increased by 140 basis points to 19.1%. The drivers of this were good performances across all our -- all our other businesses and an exceptional contribution from Nestlé Skin Health. I have to say that it is a business whose profitability is traditionally weighted towards the second half. I've talked a lot about our product categories as I've gone through the zones, but this slide does serve to highlight where we have challenges and successes from a category perspective. Powdered and liquid beverages had good growth, driven by both coffee and cocoa and malt beverages, highlights being Nescafé Dolce Gusto, premium soluble coffee, Milo and Nescau. Both coffee and -- both coffee, cocoa and malt beverages contributed to the trading operating profit improvement of 40 basis points. Waters, we've covered as a GMB. The milk products and ice cream results reflects the challenges we've had in peanut milk in China and relatively flat growth in ice cream. The 90 basis points improvement in trading operating profit margin was driven by lower structural costs and pricing more than offsetting increased input cost. The performance of Nutrition and Health Sciences clearly demonstrates the growth pillars we have had -- we have here. All elements contributed to the 210 basis points increase in trading operating profit margin, coupled with the exceptional contribution from Nestlé Skin Health. Prepared dishes and cooking aids' performance is no surprise, affected by the challenges we're having in frozen despite a strong ambient culinary performance, driven by emerging markets. The profit improvement here is mainly thanks to cost savings from all areas of the product group and strong growth in ambient. Confectionery is a similar story to the first half. As you can see, the growth is driven by pricing in response to inflation. A growth highlight remains KitKat in emerging markets. Some larger markets, particularly developed markets, have seen intense competition. So the 210 basis points decline in profitability is driven by much higher input costs and difficulty to take pricing in difficult -- in developed markets. We continue to see good growth in PetCare in both emerging and developed markets. The profit improvement is based -- is mainly due to the nonrecurrence of the Waggin' Train withdrawal in 2013. That, ladies and gentlemen, covers my -- our business review. Let's now take a closer look at our income statement. The trading operating profit margin was up -- was 15.3%, up 10 basis points as reported and up 30 basis points in constant currencies. As you can see, a driver of this improvement was the cost of goods sold. They decreased by 30 basis points, a reflection of the ongoing benefits from product mix, our efficiencies and pricing actions more -- that more than offset increases in input cost. Distribution costs for the group as a whole remained relatively unchanged for 2014, although we did see some variability in the different parts of the world, as I mentioned in my previous comments. For marketing and administration, the 2013 structural efficiency gains, including our -- in our pension plans, gave us some tough comparisons, but we made good progress in reducing our overheads. We also continue to drive greater efficiencies in our marketing, while reinvesting behind our brands. Our consumer-facing media spend was up 5.8% in constant currencies. Digital continues to be a core part of our marketing strategy and now represents roughly 20% of our media spend. It has been a major -- it has become a major influence in the way we engage with consumers. Our R&D investment increased by 20 basis points. Some of this is related to the inclusion of Nestlé Skin Health. The strong Swiss franc had an impact as about half of our R&D costs are in Switzerland. Net other trading items were broadly in line in -- with 2013. Next up is the income statement from trading operating profit to net profit. As I've said, the group trading operating profit margin increased to 15.3% reported, up -- but up 30 basis points in constant currencies. Net income and expenses includes an impairment of goodwill of CHF 1.8 billion. Now this mainly relates to the direct-store delivery system as a cash-generating unit for both frozen pizza and ice cream in the U.S. As I explained in my Zone Americas review, we have seen continuous declines in these categories. So this has meant that the cash flow projections needed to cover the asset base as required under the IFRS impairment test could not be sustained. Therefore, we had to take a goodwill impairment for DSD. Net financial income and expenses were comparable to last year. Reported taxes have been affected by one-off items. Underlying tax rate is broadly in line with last year. Income from associates and JVs has changed following the L'Oréal and Galderma transaction. Net profit increased 490 basis points due to the revaluation of the 50% of Galderma and the proceeds of the partial disposal of our L'Oréal stake. As a consequence, reported earnings per share were CHF 4.54, up 44.6%. Here, it is important to bear in mind that we have a drag on the net operating expenses mainly due to monetary corrections, driven by hyperinflationary accounting. In turn, this impacts net profit, which when coupled with currencies, has affected our reported earnings per share. Our underlying EPS as reported decreased by 1.7% to CHF 3.44. This is on the base of a strong 2013 comparison. In constant currencies, underlying EPS increased 4.4%. The group's free cash flow remained strong at CHF 14.1 billion. While this figure includes the proceeds from the partial disposal of our L'Oréal stake, it is also a reflection of our ongoing focus on capital discipline, including all elements of working capital, capital expenditure and a continuous focus on efficiencies and profitable growth. Working capital remains an area of focus. While we have not seen the same results as last year's strong performance, our efforts have delivered another year of improvements. I'm sharing this slide with you as you can see here the way we track our working capital internally. Working on a quarterly average gives a much more accurate picture than simply a snapshot at year-end. Another important aspect of the free cash flow is our CapEx, where we have stayed the course. If you'll recall, Paul back in -- said back in 2013 that we would reduce our CapEx as a percentage of sales. I'm happy to report that with the help of our portfolio tool, not only have we delivered what you see in this chart, but we've also driven a more discerning allocation of our resources, driving value for the group. The next slide, the group's net debt fell from CHF 14.7 billion to CHF 12.3 billion, reflecting our strong free cash flow during the year at CHF 14.1 billion, more than offsetting the payment of the dividend of CHF 6.9 billion and the initial phase of the current share buyback program. The strong Swiss franc has again had an important impact on our financial KPIs. In fact, the cumulative impact of currencies has amounted to around 40% of sales since 2008. Please bear in mind that the Swiss National Bank announcement we saw in January has created further uncertainty to face in 2015. Importantly, even in these volatile times, we remain committed to a sustainable Swiss franc dividend. As you can see on the next slide, this chart starts in the 1980s. But in fact, since 1959, we have never decreased our dividend in absolute Swiss franc. For 2014, we have again proposed an increase in absolute dividend. The proposed dividend in Swiss francs is CHF 2.20 per share. And so to wrap up my part of the call, like I said at the beginning of this presentation, 2014 was indeed a challenging year. And I have to say, I am very proud of the group's results. We have delivered both on the top and bottom line. Our growth was broad-based in emerging and developed markets. There were ongoing improvements in operational and capital efficiencies. Our portfolio has continued to be shaped by discerning choices to divest, to fix and accelerate. Importantly, we have delivered our commitments today and have continued to build for tomorrow. With that, we expect 2015 to be similar to 2014, and we aim to achieve organic growth of around 5% with improvements in margins, underlying earnings per share in constant currencies and capital efficiency.

Well, thank you, Wan Ling. You really gave us the whole story. But let me in the next charts to share with you a few thoughts, highlight a few things that actually explain how we want to drive and -- the delivering of results and how we do that with this consistency over time and how we want to build further on these strengths to continue doing that in the future. We know that we are living in a, well, we say it, not easy environment, soft trading conditions, you name it, volatility, instability in many areas. And I would say, we have selective memory because there is never an easy year. But what's happening today may induce people or companies to really go and shorten their perspective in time and start to focus and conditioning, actually, all what they do towards delivering today. While we do and focus on delivering today, but never we would do that with losing out of sight our strategic direction, the long-term perspective of this company. And I want to walk you through a few things that I already mentioned to you that is actually linked with certain strengths, competitive advantages, we can call it, but intrinsic strengths that are so characteristic for what I see in Nestlé. So the quality of our performance, the quality -- not only the figures, but the quality of our performance has dimensions in time. And while we stay in the course of our strategic direction, that, in a few words, is this whole agenda about Nutrition, Health and Wellness and all the growth potential and all the added value that comes out of it, we are continuing to take the decisions, I would say, of the decision -- and the strategic considerations that will build this company also for the future. And you see, here, we are differently combining always the short term with long term. And that has promises, but that has obligations. And we can do that because of what you see here. It is because of our intrinsic strengths, and I'm going to walk you very rapidly through them. It is also to be aware of certain challenges that we have today, be aware of them, acknowledge them and do something about them and build, again, solutions for these and also -- then also to do and to invest today because also, before us, people have invested for us, so we can do and continue doing that for the future. The first thing is our intrinsic strength. And I must say, there, and I have mentioned them before, our intrinsic strengths, that gives us that resilience, that consistency, over time. These are definitely what I see as strengths and competitive advantages of our company. And you have -- the first thing is our people. I have mentioned it before. And every time I travel and every time I go wherever in the world, it is that strength that radiates and that motivates. It is not only the strong commitment to our -- an alignment behind what we have been sharing with you in many, many occasions of our road map that actually says what we want to be in the future -- today and in the future as a company, how we want to go about that and where we're going to look for growth, how are we going to organize ourselves efficiently and effectively, that alignment behind us, that talking of the same language is one thing. Also, the capabilities and professionalism that we have, the fact that people that are knowing so well the realities of all parts of the world and, in a very volatile world, differently advantaged, how we can rewire our organization operations everywhere, it's people. But then it's the attitude, too, the values they live and the way they go about their business -- how they go about their business actually reflecting so much what we say Nestlé is all about. It is about creating shared value. That's a strength that is even more relevant in turbulent times. Then the other one, it is foresight. And actually, I have mentioned before, foresight and courage, that would translate into having today the results of investments made before. Nestlé is going to have 150 years of existence next year, 150 years. And actually, it started 150 years ago with one of these products that we still are selling today, Cerelac. And it has been a story of, every time, repeating, it's reinventing, inventing new dimensions for the future, and that's the strength that we are building upon now, and that is our obligation also to do it for the future and the next generations. That is why we are extending the boundaries of Nutrition, Health and Wellness. That is why we are investing in countries and taking it for the long term. That is where our strong portfolio comes out. That's where our global footprint comes out, and that is what we do further. And then how we are organized. This combination of how we combine local with global. We are privileging as an operational structure, decentralization, having the decision-making -- the operational decision-making as close as possible where the action, where the consumer is, where the reality is, yet at the same time, not losing out on the global inspiration, we call it, on global ideas, rolling it out, having a common agenda, alignment behind the same song sheet of our road map and yet translate that in actions and results in every market. These are 3 intrinsic strengths that I want to highlight here that we have to build. It's not for free. You have to build it permanently, but it's something that we have to leverage to. And that is at the base of our consistency today and in the future. Then we have challenges, and we do have very strong challenges. And Wan Ling has walked you through quite a few of them already. And it's, first of all, acknowledge them, accept them as a challenge. And we have not done everything right, and we have failed in connecting with new realities. And we have to see them as opportunities by correcting them and bringing the right actions and strategies in place. The first one is something that is not so much of our making. It is the Swiss franc, and Wan Ling walked you through that. It is something that came to life all of a sudden a few weeks ago when the Swiss National Bank decided to unlock the -- or unpin the Swiss franc from the euro. But actually, it's something we have lived with for so many years already. You mentioned 40% in the last 5, 6 years. And even if you -- I have -- take further back into the deposits even more. We have lived through a strong Swiss franc, and it has impact, although Nestlé has a natural hedge, we call it, because we do almost all of our production and sales in local, in the regions where we operate. So we have that natural hedge between revenues and cost. And we do, actually, less than 2% of our turnover in Switzerland. We have also our debt and financing that is basically 85% in dollars and euros because again, there, we have that on where we have our operations. But it has an impact. You cannot just pencil that away. We do exports out of Switzerland. We have 10 factories here, and 2/3 of what we produce in these factories are exported. Nespresso is a very good example of that. It impacts the added value that is generated in Swiss francs, definitely. And we have structural cost, and we have our headquarter here in Switzerland. We have R&D and, give and take, almost -- over 50%. 2/3 of our R&D is based here in Switzerland, so paid in Swiss francs. We have translational risk and -- through the consolidation, and we always mention that. We -- that's why we say constant currency because over the last years, it has had, although limited, but it still has an impact. Now that calls for action, and we have to take that action further, not something new, but we have to continue revisiting and rewiring supply chain, logistics, renegotiate contracts with suppliers that do have import elements in their operations. So we have to have transparency in our supply chains and go after these, I mentioned. That is what we have done. We have a call for intensity there to go faster. We have to look for productivity gains with the factories we have. And actually, we are going to inaugurate in a few months’ time a new factory for Nespresso here in Switzerland. There, we all calculate on -- upon productivity. And now we have to -- an additional challenge and look for productivity gains in these. That is possible. That is something -- a strength of Switzerland where you are able to do that, and that is the base on -- of our optimism to be able to do that in the future, too. And then we have structural cost, something that is not linked with the Swiss franc, something we're going after permanently, be it here or in the world. And the actual recent strength of the Swiss franc is just inducing us to do it even faster. That's the Swiss franc. But then we have other challenges. And we have gone through this already, and Wan Ling has given you already many points that highlights our plans we have in place. China. And China is definitely the land of opportunity, and we have invested in China. But China has seen some changes, first of all, slowing of growth, still growth though, but slowing of growth with all that comes with it. And it is our 2 biggest market now -- second biggest market. And so what happens in China is very close to our heart, and we are really involved there to see how we can swing growth back into high gear. You have to say, Nestlé in China has grown last year. You can say Nestlé in China. So what comes out of the Zone AOA is specifically a part of the range. But in total, we have grown in China. So it is a mixed bag when you see these figures. There is good performance. We have mentioned it. We have good growth in ambient culinary, almost double-digit growth; ice cream, double-digit growth; RTD coffee, the new way of drinking coffee in China; KitKat, as a brand, double-digit growth, and that's a brand that we have been building upon for a long time; Dolce Gusto, just starting and really off to a very, very good start; infant nutrition, a very strong performance last year. Nestlé Professional, that was a little bit suffering before last year. It's back on a very good growth plan. But we do have many underperformers. And the underperformers are definitely below expectations. And we have the other chocolates; coffee as a category, the same; Yinlu, the whole brand and all the products linked with that brand, Hsu Fu Chi. Indeed, what we have seen, slowing environment. But what we have seen is 2 fundamental things, and you see them here, a fast-moving and fast-changing consumer landscape and a fast-changing trade landscape. And we lost touch. And we have identified that now for quite a while. We work on plans to reconnect. You see, in China, the consumer, never in the world, at least from what I've seen, has a consumer so fast fundamentally changed as in China, his expectations, his awareness of health, his digital drive that really jumps many changes, the fact of clear label, the awareness of so many dimensions, how he combines traditional and really gives value to that, and yet at the same time, lives with a combination of modern, new, how he works with and embraces the local brands, and yet also combines that with the international brands. The fact that e-commerce is offering new platforms, new products, new categories and -- are kind of wrong for the traditional dimensions of our portfolio. That is what has impacted us. We didn't recognize that at time, and we have to make a reconnect there. And that is for the whole market and mix, and we have done that. And that is now in the process of being rolled out. It's going to be taking momentum over the months to come. And specifically, that's from the second part of this year. Nescafé, back to 60%, 40% preference in all products we have, Yinlu, nutritional augments and clean labels and -- or having more protein augments. Hsu Fu Chi, how we combine the traditional and the traditional design of the brand, and yet give it a modern flavor, without touching the fundamental traditional dimension of the brand. How we go for digital and increase our PFME, our product fixed marketing expenses, our support behind the brands through digital. China, the factories in the Nestlé world, the most advanced already in digital, and yet that is having so many opportunities. Another part is the trade, a fast-moving trade landscape. The word that is used is destocking. What happens is if you have a trade that is multi-layer, multi-different layers of distributors, some distributors selling to distributors, and then you have the other dimension of a first tier, a second tier, a third tier subsidiaries. When you have a slowing down, you have still a push model, while then you have a disbalance. And that's the balance we have to strike again between pull and push and going for the new trade channels, too, as e-commerce. That is linked with restructuring and rementalizing also your grocery sales organization. It is to organize around e-commerce and combine that with digital and social media. It is linked with product differentiation, and have for each channel the adapted products. It is embracing out-of-home Nestlé Professional more deeply, and that is what we are doing. So that has to give back this wind in the sales of good growth in China, something -- a country we are believing in, a country we have invested in and a country where we going to see growth coming back shortly. Another challenge, and I think Wan Ling walked you through quite a lot of the details already there, in U.S. frozen food. It is a category and a business for us that is challenged, and it is a fantastic category. It is a fantastic category because, first of all, it is part of the North American landscape. It has huge penetrations with Nestlé and other brands, too. It is a very sizable business, CHF 23 billion business. And it is growing -- projected to be growing for the next years to come, 3% to 2%. The category has decreased over the last years, 2% to 3% every year. Why? Because the consumer has changed also the expectations that was not given through that category. Expectations, again, very much -- very many points in common. Fresh and how fresh is perceived, and how frozen is not perceived fresh, although it has all the intrinsic freshness in there. And we have to get other growth, less process, natural, gluten-free and the high-protein drive that we see, also the way people want to eat and not going from the 3 classical meals, but having more healthy snacking throughout the day. So these are new trends that the category, because of its success, was locked into not delivering or not understanding or not making these links, and we have to connect that category again and all our brands with it. We have spoken at the Boston Investor Seminar about that, and you refer to that. It is linked with touching the whole portfolio mix, so it is a fundamental work to be done, something we started already 1 year, 1.5 years, 2 years ago. It is linked with the quality and the freshness of the products, with the ingredients we put in there. It is also going for the intrinsic quality of the category, and that's why we have this campaign, Freshly Made, Simply Frozen. It is to also go digital to get the right messages across. It is to support our brands much more. The category was a little bit starved of brand support. You may remember, we spoke about the fact that this category was driven into being on-deal. And there, all efforts were just pricing. And people don't buy prices, they buy value. And we have to get that back, and that is what is being done. So it is also repositioning Lean. We are seeing that the whole Lean market, not only in frozen, in general, is challenged. People don't want to go only for diet, they want to go for healthy lifestyles. And that's where the Lean Cuisine has to move into and is moving into. It has also capabilities, and we are integrating also a solid productivity -- a product technology center to really go about these new dimensions and to bring that as added value into that category. So you see, there's quite a lot of initiatives happening. It is happening as we speak, rolling out. It started the last year. These are fundamental changes that need some time to roll in, to hit and to connect with consumers. The trade has a very high acceptance of all the plans we have. That is boding well for the acceptance also of consumers. So we see that accelerating throughout the year. That's from the second quarter of this year and a much more meaningful part. Then these are just to show, we have other challenges. We have things that's going well I know, but these are the major ones that you have also identified. I just wanted to share with you that we accept them as a challenge. We acknowledge that. We are working on that, and we have plans that are rolling -- being rolled out as we speak. Another point and the last point I want to touch is how we position ourselves for the future. I have mentioned that Nestlé is a company that, yes, we do have short-term intensity. We are there to drive results today. We are living day and day and delivering that behind a common platform and a common strategy. Yet, at the same time, we are investing. Part of the P&L is going for investments that we're going to enjoy later on. We can do that because this company has been driving this rolling, building platform dimension. And we can do that because they did it for us in the past, building strong arguments, building strong portfolios and brands well for us to do that also. And that's why we are building on our Nutrition, Health and Wellness strategy in a very meaningful way. And the best example of that is our expansion of the boundaries. We are building through our food and beverage, which is the foundation of this company, our Nutrition, Health and Wellness agenda. That is where the biggest part of our R&D goes to. Yet, at the same time, that is what are delivering the results today. At the same time, we have to build and make complementary growth platforms that have -- that has a lot of promise. Hence, there, our new Nestlé Health Science that we started in 2011, that we started to build and then also, last year, by bringing Galderma in, the establishment of Nestlé Science -- Skin Health. These businesses are small, and yet sizable. They do already over CHF 4 billion, and that's just the start. They have entailed a promise of profitable growth for the future. Nestlé Health Science, 3, 4 years work on that. We have selected -- or identified the selection of opportunities -- growth opportunities that will differentiate and where we invest in science. I'm not going to walk you through the details, but we're going to have opportunities later on for that. And also -- but we have shared and structured also that company behind these 3, I would say, businesses: consumer care, specifically more intensively organized around healthy aging and all that comes with that and all the brands that already play there; medical nutrition, a very scientifically driven dimension for specific inborn error of metabolism, and you read it there, pediatric care, also metabolism -- metabolic care and so on; and then we have these novel therapeutic nutrition that really looks for development of transformational nutritional therapies. This is really building the future. And that's why also we have taken mistakes and sales hell for a gambit -- for example, that really goes about exploring how nutrition can be linked with the microbiome and giving, there, also good answers. And we have engaged in venture funds to keep our ear close to the ground because there is so much happening in that field that entails so much promise. Same with Nestlé Skin Health. We brought it in last year through Galderma, an existing business. We have a very strong setup. We have leadership in the specific areas that they're playing in. You see, there, also, we have defined the business and structured the business also behind 3 businesses: you see, there, prescription, that is basically health care professionals handling our leading brands like Epiduo and Oracea; self-medication, over the counter, Daylong, Cetaphil, very strong brands that we have there that are increasingly also fueled by more deeper science and research and development; and then aesthetic and corrective. Well, these are definitely the building blocks for the future. We're going to talk, over time, how we evolve there, but they really entail an amazing promise of profitable growth. Another thing I noticed -- my last point I want to share with you is that a few months ago, here on the floor, I was sharing with you the establishing of Nestlé Business Excellence and to give that really the right level under the leadership of Chris Johnson on the Executive Board level. It is by bringing together Nestlé Continuous Excellence, GLOBE and Nestlé Business Services. Each of them were initiatives that do have and have had a major impact on our organization. GLOBE dates back from 2000, where we really went for harmonizing the business processes, standardizing data management and also systems and technologies. In 2008, we had Nestlé Business Services. We have now, in 5 markets, 5 business services. We have one central one here that are servicing all markets, and yet there is huge opportunity there to go deeper. Nestlé Business Excellence, this whole mindset change of looking into the -- each person, the 340,000 people of Nestlé, this whole drive and awareness of doing things more efficiently, many projects that are converging to our savings that we have been communicating every year. We are a fundamentally decentralized company. I have mentioned that, the local global dimension. I'm a true believer of that part of our DNA, yet at the same time, we have a size. We have a size that we have to translate into scale and into competitive advantage. If we do and see, just as an example, the benchmark, we benchmark how deeply we are scaling up certain services. Be it finance and control services or be it HR service or procurement, there is upside. And that is what this whole thing is all about, to really see how we can leverage our scale, our size into scale and competitive advantage and unlock resources so we can invest for the future. And that is going to translate on -- or it's going to be done on 3 basic principles. It is all about simplifying, it is all about standardizing where we can, and it is all about sharing and leveling it up where we can. So that is going to give us then this highly efficient support structure, and it's going to go deep. This is going to touch the whole dimension of our company, every part of our company. We're all involved there, and it's going to be a fantastic story because it's going to give us the speed and quality of execution in anything we do, with the only purpose to have the resources to invest for our future, to have the resource to invest behind our brands. And I think that is what gives the Nestlé, what I would say with some pride, definitely these characteristics: Nestlé to be resilient, good times, bad time, resilient, strength into strength, be innovative, be groundbreaking, have this vision on and anticipate future dimensions and build for them. And then also, this consistency or quality I feel in -- over our operations is dependable. You can count on the people. You can count on the company consistency. Well, with that, I think I come to the end of my little part, where I really wanted to stress a few intrinsic dimensions that are sometimes not mentioned with the right attention. I have said that one of our strengths is our people, and I want to, through this again, say how important I feel people are. They are -- at the end, bring all these results, and I want to thank them for that. So with that, thank you very much for your attention. We open now, yes, for questions and answers. So...

Thanks, Paul. [Operator Instructions] Let's now take the first question from the call. The first question is from James Targett at Berenberg. James Targett - Berenberg, Research Division: Two questions from me. Firstly, just on the U.S., I wondered if you could provide some color on the magnitude of improvement that you saw in the second half or the fourth quarter. And you have clearly communicated the need for repositioning of some your brands, like the [indiscernible], but now how satisfied are you with the portfolio you have in the U.S., particularly in frozen? They've been up for review now for a couple of years. Is there still some pruning to come or bolt-ons? And then secondly, just in terms of China, again, you flagged you need to reposition some of the zone categories in China, and that still needs to be done. But is it the destocking elements that impacted the performance in 2014 now -- broadly over now? Or do you expect that to be a drag again in 2015?

Well, on frozen, I think we have been quite explicit there. This is something that we're not rolling out now only. We are touching each, and you saw we have 4 categories there, where we have the leading brands. And we have been working on them now for quite a while. There is an acceleration of launches because when you start reformulating brands, repositioning, not fully but repositioning, redesign brands also, revisiting your communication, these are fundamental shifts. It's clear that we're not going to have them all at the same time. We have been doing already certain things in handheld and in pizza. There's quite a lot, but we do see, for Lean Cuisine and Stouffer's, the relaunch is being done, as we speak, with connection with the trade, some to come on in the second part. That is going to have to get traction. I think we have compelling plans, but that is going to have to get traction over the months to come. It is clear that, that momentum is going to be built up over the months. I would say second quarter and then further on. If you compare versus the years before, we had decreases. So we definitely speak about vigorous growth again, and it's good timing because North America per se is -- again, consumer confidence is taking some additional colors, and there is openness for it. So I am really optimistic to see good results coming off of all the efforts we're going to do. It is clear we have to have to trade first with the new offerings before we really start to support these new ideas and new brands, and that's going to be also a little bit later on. So -- but it is something that is going to take momentum definitely. Now in China, the destocking, it is clearly destocking. I spoke about the change in consumer that -- at the end of the day, that is what drives the sales. Yet at the same time, you have these drivers. There was definitely a system in China, where through -- and I mentioned that through the different layers and different dimensions of cities, the first, the second tier and -- you had quite a lot of stock in the trade. You get the softer growth environment, a softer pull of takeoff, and you don't identify that as a company or as an industry. And actually, the whole mindset was pushed because it was growing and there was nothing too much. And all of a sudden, that's definitely in accounting. All of a sudden, you slow down, and it pushed back upstream. And that is what we have been doing now for quite a while because you don't do it abruptly. There is still some remnants to be done, but we have definitely now embraced also again, this whole pull model, where you go really for the consumer but then with the right offerings and hence, the whole reformulation of the marketing mix. These are not done overnight, but that's, again, coincidence maybe in the timing. But that's, again, something that has to gain momentum. Also, the launches are coming in or being rolled out, again, not all at the same time. They're going to have a phasing because there is also efforts and people involved there to drive -- our sales forces have to be linked to that, but I definitely believe there's a good -- I saw that. We're going to go there in a few weeks' time, again, to see it in situ. I see good things happening, and there is called [ph] very, very many good arguments, linking, again, our brands with the consumer. That is what matters, and that is what's done. That doesn't have the same, I would say, impact in time as, for example, destocking. So we go the bat all at once. We're going to have the good rolling out and gaining momentum over the next months.

Thanks, Paul. The next question from the call, Jon Cox, Kepler. Jon, you have the floor. Jon Cox - Kepler Cheuvreux, Research Division: A couple of questions for you. Just on the -- Paul, you seem to be talking quite a lot about the sort of the cost base in Switzerland. And obviously, in 2014, we saw a 30 basis point impact on the margin from that sort of slightly overexposed Swiss cost base. Given the fact that currencies, at the moment, seem to be pointing to a minus 6%, similar to what you had in 2014, would you anticipate another 30 basis point impact as a result of what's happening with the currencies? Or are some of these measures you're talking about, you would think that maybe there would be a reduction in that impact? That's the first question. And then a second question maybe for both of you and your thoughts on dividend and buyback. Obviously, again, you've increased the dividend, which, obviously, is good news in this environment. You have the buyback going. What should we expect going forward? You seem to have maybe moved the mix back to buyback plus dividend from, say, dividend from the previous CFOs. I'm just wondering what you think of that? And I just want a quick, sneaky #3 question, if I can, just to come back to that China situation and the destocking. Am I right in understanding that it's because a lot of the products now are moving to e-commerce and you haven't actually been there so exposed and that is the issue for you in China or at least partly?

Well, on the cost base, and I may give some of the answers to you, Wan Ling. But on the cost base in Swiss francs -- and I have to remind you. For example, a few years ago, we had a ForEx impact of almost 12%, I think, or was it, over the year versus our basket of monies there. And that was an impact of 30 basis points. But I don't see and I'm not going to express because that would be very anticipative, but the Swiss franc is going to have that impact. That's why we're going to work on that to see how can we soften the impact of the Swiss franc revaluation. We have all year to do that. It's something that is done in the U.S. I mentioned we have been going after that now for many years. We just feel there is a little bit of an acceleration or visibility from all sides, but that's going to be done again. Actually we have done it over time. It is -- that is productivity gains basically, and that is -- there is still upsides. And that's what we're going to work on at the end of the day also and the easy part of that solution, too, in a sense of how can we really support functions being better and more efficiently given. On the dividend and the buyback -- maybe for you, Wan Ling, I think, and dividend policy have shown quite a nice history. And we want to have some traditional qualities, too, so -- but for you. Maybe China, before you answer then, the dividend on China, the destocking, I would not say it is e-commerce taking over. There is traditional trade people, go-to stores, et cetera. There is e-commerce. But I feel in China, it is reconnect with consumers, in general. We still have a very good growth and very strong brands there are going well in many areas. Some have weakened. They still connect with consumers. We just have to add that additional new expectation on the consumer and build that in, in our brand architecture. E-commerce has gained a lot of traction, it's true. E-commerce has different portfolios that are offered that may wrong foot the traditional dimensions of the consumer product landscape. That's where we want to reconnect. These are adjustments -- some deeper than others, adjustments that we are making, but we are engaging definitely in e-commerce as a trade channel in China. And what I do see -- and I have mentioned that before, I think e-commerce, in all its expression and forms, is going to be actually, I think, proportionately more important in developing in younger markets, where you don't have such a strong retail base yet, a little bit like the cell phone, how these markets or these countries are jumping stages. And that's why we are engaged in digital, be it social media, because they are intimately linked to each other and e-commerce. And that is also part of the answer we give in China, building these capabilities in an accelerated way and engaging with the big e-commerce players proactively and in certain dimension partnerships. On dividend and buyback maybe you, Wan Ling?

Yes. Jon, on dividend, we have made it -- we've repeatedly said that it's going to be a sustainable dividend policy. For 50 years, we've never reduced it in absolute terms. So that has not changed and will not change. In terms of share buyback, you've seen on our cash flow statement, we've done CHF 1.5 billion of the CHF 8 billion program that we announced last year. To date, we've done CHF 2.5 billion, and that is a program that we intend to complete by the end of 2015. And so it's -- so that should answer your questions on both.

Thanks. The next question from the call is from Alan Erskine with UBS. Alan? Alan Erskine? So we don't seem to be able to get that call reception. We're going to have a question from the room. John?

John Revill, Wall Street Journal. A couple of points. In your guidance, Mr. Bulcke, you say you're guiding for around 5% organic growth for next year. Does that mean you're preparing the way to go lower than your 5% to 6% next year as well after 2 years of missing it? And the second point is, you described these results as solid, but they are actually your lowest -- your weakest growth in 5 years. So is this solid compared to your peers? Or how would you describe that? And just a final cheeky one as well. Just give us a bit more color about China in terms of the destocking. Is it basically you had the wrong products before and you replaced them now? Or just give a bit more color on what's happening in China.

Thank you, John. You're always so nice to me.

Sorry [indiscernible].

It's nice, we can talk later still. This around 5% is actually the better expression of a sense of reality. In answer to your second question, too, you said that -- about weakest growth and -- et cetera. You look at world, and you see what the growth environment is in the world. We're part of that. What we did, though, is, again, building growth on growth and do that also by outperforming the market and combining top line and bottom line at the same time. That is what I call consistency. I think that's what I meant with solid. I didn't say they are excellent, they are good. I said solid. And that, I think, is what it is. I didn't fail the Nestlé Model per se. I explained that to you quite explicitly last time. The Nestlé Model is something we've been aiming at for the long -- for the medium term, and that is built upon -- sometimes, we go over it. We don't excuse ourselves for that. Sometimes, we're under it, but you see that over a medium term, it is right there, 5% to 6%. Why? Because that's -- it's what we feel we are working for, we are conditioning the work in the company for, and that is what the environment, over time, should allow us to be doing. We are aiming, again, at 5% because that's how we are. We actually -- sometimes I say to myself we are arrogant because we -- that is what we're aiming for. We have all reasons to soften, but we're not asking a low weight on our shoulders. We are straining to strengthen our shoulders and say we're going to do whatever it takes to get to 5%. That's our aim. That is what helped us, for example, last year to overperform because we aim to 5%. Around 5% is the term that I feel is appropriate for what we feel is in there for this year.

So now we'll...

China -- could you just give a little bit more color on the China situation and destocking?

Oh, the destocking. I do believe -- when I said in China and -- there is always this dimension of destocking. I don't feel this is -- that is right to explain. That's actually an effect. That's the result of something, softer environment, softer this, models are pushed, balancing push, pull. I feel it's as much more important to understand, I feel, as a company, how we stay connected, and we are. We are very hard on ourselves because we go what doesn't work. What works, let it go on, but certain dimensions, certain brands and certain parts of our brands, and they're connected with the Chinese consumers millions of times a day. Yet there is a movement, a shift, and that shift, we should translate into that brand to be able to connect with that shift, too. That's what we're talking about. And destocking is what you see. That's the effect. That's what hurts on the figures. There is underlying something more important that we are working for. So we do want, but basically, what matters is the other one, and I feel that is what we -- that has a softer impact once you reconnect, you reposition, you reformulate next time. All of these things, they have a longer time line to really impact, and let's wait for that now.

So you had the wrong product in some places and now you're replacing them.

Sorry?

You had the wrong product in some places and now you're replacing them?

No. Again, we -- you have this tradition. For example, Hsu Fu Chi is a brand that is so much tradition, so much linked with the landscape of the Chinese consumer. We're not going to throw that away. That has value. Yet at the same time, we have to build behind this brand that also -- we don't -- disturbing the tradition, the new dimensions, the new expectations. So it's not wrong or right. That is evolving, and that is what we are doing. We're not throwing things out and restarting. There is no rebooting of certain brands in China. There's this -- an evolution of connecting in different dimensions. Brands do have different faces to the consumer. We add them so that they respond to the new expectations.

Okay. So let's take that next question from the call from Alan Erskine of UBS. Alan, please go ahead. Alan Erskine - UBS Investment Bank, Research Division: Can you hear me? Hello?

Yes, do you hear us? Alan Erskine - UBS Investment Bank, Research Division: Yes, I can. Perfect, okay. Just 2 questions from me, technical questions really. Firstly, Wan Ling, you mentioned that the margin performance of the other division was helped by the fact that Galderma is seasonally weighted to the second half. My question is, can you give us an indication, if Galderma had been there for the whole year, what the difference would have been to the margin? And my second question was with regard to the performance of Nutrition in the fourth quarter. If I've done my numbers right, it was a very strong performance on -- lapping the very strong performance in Q4 of 2013. So I wondered, could you just give us some color as to what were the main features for Nutrition in the fourth quarter?

Well, on the margin, I think you can answer but you did it already because you said the business of Nestlé Skin Health, Galderma, is weighted to the second part of the year. So as we had it only in the second part, we have an advantage there that's going to be soft if we would have taken the full year, and that's what we're going to have this year. Basically, I feel that this is the answer. I would like to go in more details there. And then on Nutrition, fourth quarter maybe you, Heiko, on Nutrition. You can give us some light of why is Nutrition going well and specifically in the fourth quarter. Do you want to say something for that?

I expected -- I just want to add, too, Alan. On the Galderma impact, it's obviously not something that we publish because it's part of our other businesses, but if you look at our annual report, you can very easily calculate the impact. So you just have to -- it's there.

Well, that looks like...

It's there. We don't publish it.

So you have it, but we don't give it. Okay, I go now. Just to drive a little bit what is -- because Nutrition has gone well for us. And infant nutrition in certain areas, in certain geographies is really well for us, and we saw some acceleration. Why is that?

Yes, if you look at the performance of Nutrition...

Is the mic on?

Yes, it's on. If you look at the performance of Nutrition in the fourth quarter, it's, I would say, more continuation of also the quarters before. It didn't particularly grow more in the fourth quarter than in the previous quarter, but it's true that last year, in quarter 4, we had a very high -- so we had a high comp to compare with. I would say -- similar to Wan Ling and then Paul were highlighting, is that we have very strong performances in Asia across-the-board, yes, in China but also in the Rest of Asia, particularly on our formula and our GUM businesses. And that's kind of a continuation. And I would say on e-commerce, it's an area which there were some questions about. We have certainly also accelerated our performance there. So that's maybe something that, throughout the year, we're seeing quarter-by-quarter an acceleration of our business there.

So the next question from the call is from Alex Howson with Jefferies. Alex, go ahead. Alex Howson - Jefferies LLC, Research Division: It's Alex Howson from Jefferies here. Can I just confirm how you've treated the organic growth of Galderma and other acquired skin care -- Skin Health assets this year? Have you included these within the group organic growth number or within the M&A number? And if you have included it within the organic, could I ask how many basis points contribution that's made to the group number? And then on a separate tack, could you give a little more on how the VertuoLine launch in the U.S. has progressed? You say you're pleased with it, but perhaps you could flesh out what's been achieved to date with the launch and if it has driven a materially higher rate of growth in Nespresso in North America?

Maybe you go -- I'll go. We have given already on Galderma, so my answer on that. But on the VertuoLine, I must say it is really going well. Also, on Nespresso, Clasico is going well. It gets quite a good traction. The acceptance of VertuoLine is going very well. Also, what is very important to us is the usage of it. So there's a high throughput on the people who have bought the new machine. It is really giving very good marks on acceptance of the product. So that is very important again. It is something that starts in the biggest coffee market. So it has a lot of promise. We are very happy with how the VertuoLine, together with the Nespresso brand, in general, is going in United States. And I would leave it there. On Galderma?

Yes. On Galderma, in terms of organic growth, yes, the organic growth for Galderma for the 6 months in the second half when -- after we bought, we finished the transaction, is included in our OG. And so that is included, and the estimate -- the impact is about 10 to 20 basis points.

The next question from the call is from Gerry Gallagher of Deutsche Bank. Gerry, go ahead. Gerry Gallagher - Deutsche Bank AG, Research Division: I just want to come back on the guidance, if I may. I couldn't help notice the inclusion of the words, "we aim to achieve organic growth of around 5%," and I think those 2 or 3 words, "we aim to achieve," are new. I appreciate all that you've made, the comment [indiscernible] in these numbers, and that's why you expect the 5 [indiscernible] around 5. But firstly, is it why you have given yourself additional room around the 5%, under 5% [indiscernible] we aim to achieve [indiscernible]? And secondly, aligned to that, can you give us a sense of impact of 5% [indiscernible] in terms of the contribution to organic growth?

Well, we're going to try to read your questions because it's a very bad connection. The first one was -- actually, I don't think it was a question. It was a comment. It was a statement, saying you're stretching a little bit to aim to achieve around 5%. There's quite a few words to get it to say you get some freedom. I think in a volatile world we're living in, that's appropriate. I mean, I am really not worried about 10 more -- or 10 basis points more or less on ourselves [ph]. We are aiming -- as an organization, we are aiming at 5% growth. I believe it's in there for us to make, and we're going to see how far we get. That is what brought us in very difficult years already 2x to 4.5%, which is a fundamental building block of the Nestlé Model because 4.5% will add up eventually -- or adds up really with the part already that we have averaged over 6% growth. So that adds up to deliver the Nestlé Model, which is 5% to 6% in the short-term line that we want to walk. So that's why we say we aim to achieve because I don't want to relax an organization like Nestlé and say, "Let's adjust a little bit our targets now, and let's go for, yes, 3% to 5% span so you can actually choose then." I think it's -- yes, maybe, arrogant. I should maybe not be so arrogant. What it does though are the lines in organization at Nestlé. And actually, that around 5% is only for me because everybody has another figure. And that is linked to the potential of the reality, the potential of the business is responsible for, and I think that's actually the way we work. And the internal targets, to a certain extent, is what we pronounce to the outside world. We don't play around with, "We go for this," but we only give that. So I hope we can -- to get a lift with that kind of guidance. And the other question, I must say, was about America or something, but I didn't hear the question. Maybe...

Would you like to repeat it?

Gerry, I didn't hear your question about. I hope it's, Gerry. I don't know. Now he's gone, but did you hear? I could hardly get it. I'm sorry for that, Gerry, but we can always answer. If there's a specific question for you, we can always answer that later on.

Okay. So the next question from the call is from Warren Ackerman of Societe Generale. Warren, please go ahead. Warren Ackerman - Societe Generale Cross Asset Research: Paul, Wan Ling, Steffen, it's Warren Ackerman here at Societe Generale. I hope you can hear me. It's not been a great line. The first question from me is around confectionery margins down 210 basis points in the year. Some of your peers have pointed out that Nestlé has taken no pricing in chocolate in Europe in 2014, and I'm just a bit surprised by this despite your comment about the difficulty to pass that on given the intense retail backdrop. I mean, you've clearly been hit by much higher cocoa costs, as we can see [Audio Gap] a few years of trading operating margin in confectionery is about 17%. So the question is, should we be getting concerned about profitability in confectionery? And is your policy of not taking pricing in European chocolate likely to remain your strategy in 2015? That's the first question. And then a second one. I just want to touch on a few geographies. Why was the U.K. and Germany weak? I know it's -- those 2 geographies were doing quite good in the recent past. What's changed there? And then on Latin America, you talked about slowdown towards the year-end. Which geography and categories are you talking about? And perhaps you can say a word on Mexico and the impact of the soda/fat taxes on category growth.

Well, on no pricing, maybe we didn't do so much pricing last year because we did it before. Normally, we're the first one to price. The -- but that's how competition is. That's -- everybody talks, and they give very high impact of the cocoa price. Yes, it did -- we did so. And that is -- basically is planning what happened also on the bottom line. That is to be ironed out again. We had good gains last year, the year before. That has -- have been given back a little bit there, but that's -- again, pricing is -- and maintaining the systems of our business is one of the highest elements on our agenda, and we're going to go for that. Part of -- I must say U.K., Germany is linked with exactly that, higher price competition in confectionery. If you see coffee, it was -- it went well -- quite well in Europe, but confectionery, especially in the U.K. had a little bit of a softer thing. So actually, I felt we could reverse the arguments others are using but -- and that's it. Latin America is always a mixed bag, and you know that. Mexico, we had softer growth during the whole year almost. We see that coming back now next year. It's so much linked also with North America also, and it's NAFTA that I mentioned but -- and that's North America. U.S.A. is getting more colors back. We may have Mexico also getting better. I think also the tax has taken out the dent in consumer consumption because what it did was basically -- and for the less purchasing power part of society, has increased pricing. That is an effect of having taxes on certain dimensions that are touching specifically food that goes to that part of society. So that is there. It impacted all industry to a certain extent. So also, Brazil -- although Brazil saw some slowing, I think also, with raw material prices and what drives their economy, and we're part of Brazil. You know how a huge penetration we have in Brazil, but well, I see that Brazil is actually already on slightly slower growth than we were used to, and we're going to have to live with that although we have quite a lot of innovation there coming into the pipeline also, a lot of increasing brand support because in Brazil, brand support is essential. And we are increasing our brand support there, too. So these big -- 2 big markets are actually conditioning. Yet at the same time, all other regions, Chile, Peru are -- Central Caribbean have shown good growth figures. So there's many, many good stuff, but these 2 big ones are conditioning a little bit the perception of Latin America.

And just to add to the specific question on Mexico in terms of the fiscal legislation, that affected about 20% of our portfolio, Warren. So...

Okay. Before taking another question from the room, the next question from the call is from Celine Pannuti of JPMorgan. Celine, go ahead, please. Celine A.H. Pannuti - JP Morgan Chase & Co, Research Division: Yes. My first question is on the price outlook for 2015. You mentioned that [indiscernible] Q4 was a slowdown in pricing. I was wondering whether that momentum should continue to decelerate, especially there was some point about legislation in Europe. And on the same page, could you tell us what is your raw material cost expectation for 2015 and whether that expectation is driving the pricing lower? And my second question, [indiscernible] to FX, could you...

We can't hear you very well. Celine, could you repeat the second part of your question? We couldn't hear it. Celine A.H. Pannuti - JP Morgan Chase & Co, Research Division: Yes. So my first question was about weakening pricing as well as the raw material outlook for 2015. My second question...

Yes, your second question? Celine A.H. Pannuti - JP Morgan Chase & Co, Research Division: Yes, was on FX. At current rate, what should we expect in terms of impact on top line? And am I right from what you said on the first question that the impact on margin would be less than 30 basis points?

FX, yes.

Well, I think you...

Yes, let me -- Celine, it's Wan Ling here. First of all, we do not guide pricing. Pricing is something that we do locally, and we don't do it on a sort of -- like at a group level. But having said that, our expectation is no different going into 2015, which is emerging markets, there -- in hyperinflationary countries, we should be able to take pricing; developed markets, Western Europe -- North America, we might be able to do something in Q4. We were able to take some pricing in terms of frozen actually. So -- but Western Europe, more of the same. And so the dynamics will be -- going into 2015 will be more or less the same as 2014. In terms of input cost, our guidance is the same as 2014, in the low single digit for input cost. And in terms of FX, we do not -- again, same thing, we don't guide in terms of FX impact on our results. But one thing to bear in mind: there's a translation and there's the transaction. From a transaction standpoint, Paul talked about it in his presentation, almost between 80%, 90%. There's not a mismatch between sales and cost because where -- we produce where we sell, and so 2% of our sales is basically in Switzerland, but -- so from a translation standpoint, yes, but we don't guide on that. From a transaction standpoint, it's not -- there's not a significant mismatch because, like I said, between 80% to 90% is -- there's natural hedge. So...

So the next question is from the room over here, please.

Ben Peters [ph], [indiscernible] Zeitung. Mr. Bulcke, you talked about Business Excellence and an impact of 10 or 20 basis points. But we are talking about efficient consumer response and value chain management for 20 years now. Don't you have higher impact in your company with all these efforts you drive internally? Or do you give it away to your customers, to your retailers or to your end consumers?

Giving away is a bad term, I mean, because it sounds like for free. First of all, NBS is -- we bring together already initiatives and dimension of our company that are already there, and that is what has helped us also to really drive our performance over all these years. We speak about growth with an enabler. We're speaking about our Nestlé Business Excellence and Nestlé Continuous Excellence efforts that -- really driving a lean thing into the organization. It is always many things coming together that allows you to deliver, and it is also part of what we deliver. Other part is we have increased our R&D over the last years. We have increased also our, as we call it, PFME or the support behind our brands because we have, every year, more added value products that we have to communicate deeper for. So we're building the platforms for the future. Also, that takes resources. Like the Institute of Nestlé Health Science, that is supporting Nestlé Health Science as a business, and that has a lot of promise. But these are upfront investments. So what we do with our -- whatever comes out in more efficiencies and more effectiveness is to really use that as a fuel for growth. That's how we're -- actually we are calling Nestlé Business Excellence by bringing these to 3 dimensions together, by going deeper into the organization. There is going to be a resources that -- and we do it for that -- resources to fuel growth, and part of that goes to the bottom line, part goes to customers. It is, indeed, to care, to keep on being competitive in our relationships with them versus the others. So it's a matter of resources. And we take them where we have upsides, and I think we have still upsides there. I don't think I spoke about 10 basis points. The 10 basis points or increase in margin, we say, is a target that we -- again, that is something we set ourselves for. That is if we go as a company and leverage our scale better, if we do Nestlé Continuous Excellence well, if we are smart and driving added value to our products, that should have an effect on margins. That's how we say, "We go for better margin." But what we get in resource -- additional resources, much of that goes behind supporting our future.

Do we have another question from the room? Yes, Hara-san?

I just have 2 just questions, 2 local question. I'm Brad Avenia [ph] from Lato [ph] in Geneva. My first question is you will propose Patrick Aebischer to be elected at the next Annual General Meeting. I would like to know if you could just comment on what you think he can bring to Nestlé. And my second question, you said the productivity in Switzerland must be raised because of the Swiss franc on your 10 factories, and I wanted to know how very concretely do you think you can raise the productivity and if it will have an impact on your employees here in Switzerland.

Well, I think if you see the track record of Patrick Aebischer, can he bring something to Nestlé? If you then see Nestlé being increasingly on a drive, if you see what we want to stand for, it is to drive quality of -- enhanced quality of life of people through Nutrition, Health and Wellness based upon increasingly science-based innovation. And he is somebody who has a passion for exactly that and how nutrition is part of a healthy lifestyle and science, et cetera. I think it's a very strong addition to a board of a company that has the same agenda. So I see that as very positive. Now on productivity and in Switzerland, what we said is it doesn't mean taking people out. These kind of factories are growing or -- and you have to be effective in competing even with the Swiss franc of having these factories having more production. So we are going to absorb the same people, definitely. We have a national outflow of people. Should we replace them? I don't know. We're going to have to see. Definitely, there, we are in direct discussion with our employees to see how can we be more productive. Now the easy part, what I see a little bit of -- be too easy for us would be we take 10% people out. That's not the answer. We have invested. We -- I have mentioned our people here before. They are driving the results of this company. Now there are productivity gains to be made together, and that's what we're going to do. We start to have saying also, "Should we increase our salaries?" Well, I don't think so. If you see that Nestlé alone has reduced price on 600 products, well, inflation in Switzerland should -- at least, if there is one effect that we would expect of having the strength of the Swiss franc coming in is that quite a few products should go down in price because there is still quite a lot of imports here. So we have to see that altogether, and that is what we will do.

The next question from the room. Hara-san?

Katsuhiko Hara from Nikkei. I have 2 questions. The first one is about the Swiss franc. In the actions that you will take to encounter the situation, you did not mention moving the production or the R&D or the headquarters out of Switzerland. Maybe you feel that is too extreme or given the situation with the immigration as well. And my second question is about Japan. Since you're doing so well with the innovations, do you have anything in mind that you want to take out to the world and expand?

Let me first answer in Japan. Japan is good story, and that's in spite of all. You see, there's an environment that would induce or help you to have all the arguments and say, "Well, I'm not growing because look at," and then you go. But we have vigorous growth in Japan. And why is that? Because of creativity, and very innovative ways of going about the business, bringing new elements in. And actually, we have been speaking about a Mr. Pepper [ph], which is a small comp -- these are -- well, not any of those that really makes an impact, but these are all ideas that came out of a market that are -- I do believe, are totally useful for many other markets as an attitude; it is not take, not accepting a no as an answer and finding new ways, digital going deep in there, new systems, adding value to the base products we have and build value around that for the consumer. So actually, I think we're going to have one of these Dr. Peppers here when you go out a little bit later, or 2. So you can really shake hands with them. It's very cute, but you see, it's, again, a -- quite a few things that falls together, but there is one common denominator on that thing. It's entrepreneurship, going after. There is so much value to be created even in countries that don't have that natural, I would say, pull effect of growth. That's induced growth, definitely. You see KitKat again, last year, very good growth. KitKat, that was already a sizable brand in Japan. Well, it's growing like it just started; Nescafé, very strong growth there, too. So on your second question of moving, these are the questions that you get. Is Nestlé going to move? Well, we are a Swiss company. We have our headquarter here. We have R&D and the factory. R&D grows and then you have tendency of growing. We have factories. We're going to inaugurate a -- end of the month a new special factory. It's clear that's a decision taken to a few years ago. Would we take the same decision? I don't know. We would have to see. It is clear that decisions are made, taking into account many, many dimensions. And there are so many good dimensions here in Switzerland. You have just to see, would that be the same equation today? And it is not only the same for the Swiss franc, it's part of -- and I would say it's the minimum part. It's more that framing condition of Switzerland that I feel, with immigration, with et cetera, with, with, with, that, I think, Switzerland has to think about that. We have to think about that. I'm saying, are we going to translate or bring our export parts of our activity to the outside world? I'm not saying that. What I'm saying is, if we would have to expand something here, well, I would think twice. That's another way of seeing it, but I think we -- and we are part of Switzerland. We and Switzerland have to think about that.

We have a next question from -- over email from Johannes Ritter of the Frankfurter Allgemeine. Two questions, if Ferrero goes to sale, would you be interested? And the second one is, why did the operating profit as a percentage of sales fall in 2014?

You answered this. On the first one, I'm sorry. I'm not going to answer that. And actually, this family is in a special moment and I respect that. So I'm not going to have comment on that. On this net operating profit as a percentage of sales fall in 2014?

Yes...

Oh, that's the reverse.

Yes, trade operating profit was up both on reported and constant currency basis. So...

So it didn't fall, it ended up?

Yes. It was up in constant currency by 30 basis points. So...

Okay. We have time for one last question from the room. So -- but perhaps, well, 2. So let's -- Uli [ph] and then Nathalie here .

Uli Roff [ph], AWT [ph]. Two questions from my side. First, on acquisition, is -- are acquisitions actually becoming more of an issue if the Swiss franc should stay on this high level we've seen in the last weeks? And then secondly, on financing, we've seen negative rates on some of your bonds in the last couple of weeks. Does this have any impact on your financing policy?

This is clearly a very interesting time that we're in. And as a company, Nestlé, we're, obviously, going to leverage whatever favorable condition that's out there. And so that, we will continue. In terms of M&A, we don't guide in terms of specific transactions. Clearly, we -- as a company, our first focus is on growth and investing for our future. So to the extent that there are interesting acquisition possibilities out there, we're always looking at them, but we don't guide in terms of specific -- with specific names.

And also, the Swiss franc is stronger. If you buy something in another country, then the natural hedge plays again. So I don't think this is an impact. That's not part of our consideration per se to do acquisitions.

Okay. And perhaps the last question to Nathalie. Nathalie Olof-Ors: Nathalie Olof-Ors from AFP. I just like to come back on the pruning of your portfolio. Back in 2013, you said you were starting a major review of the underperforming brand. Could you let us know where you stand behind the process? Shall we expect some form of acceleration on this? And my second question would be around artificial flavoring. 2 days ago, you announced that in the U.S., you would remove artificial flavoring from confectionery, yes. And could you let us know if you intend to extend that to Europe or to other categories and what that says about consumer trends?

On portfolio management pruning, portfolio management is not only about pruning. Portfolio management pruning is part of it, but portfolio management is to have insight and to make that shared with people who decide on what we expect from ourselves, as we call it, categories or approach or brands and markets, what we expect from them. And by defining that very explicitly and build that into your whole planning process, you create an awareness that each cell has to earn its place. And when it does, that means investing more. So it is also a tool that is not only pruning. It is also to decide where we allocate our resources because we have higher possibility of winning that is driving better profitability and growth but has prospect of having our agenda and leading that category, et cetera. SKU management is one of them, where we really prune because there, we take out what is really more balanced than enjoyment. So -- and what's important is, we say we're going to accelerate portfolio management. We had portfolio management. What we did is actually made that awareness much more visible and explicit in the decision criteria and also make that decision criteria much more felt through the whole organization. And that is now built into the planning process, strategic planning process, in a very, very fundamental way. Artificial flavoring is something we have been working on for quite a while. This is not because of those. What we did in the United States, we said at the end of the year too. And that's a little bit linked toward the commitments that we have put aside from many other areas. You may remember in our annual report, we said, look, instead of having these internal objectives and all transparency, why are we not putting them outside and share them and say that's what we're going to, that's what we're aiming for, that's what we will do. And we're reporting -- you're going to see now in the annual report of this year, again, we report on last year and how we are doing and commit for the next years to come on many of these issues, too. And one of the biggest strengths of this business is this commitment is what we want to be as a company, Nutrition, Health and Wellness. Well, artificial flavors, we consume all that, although fully safe and all, but that's a sensibility that consumer has. We answer to that. We have done that already on all products that go specifically to kids, like Smarties and all that. They don't have that for many years already. Well, we commit to the outside world to do it in the whole range of chocolates and confectionery in the United States. And that's a move that is in Europe, too. We don't say we do it in -- we don't -- we do something in the United States, but Europeans, we don't care, because the inside is a way to do it. All that, we apply then worldwide over.

So that was the last question. Perhaps your concluding words?

Well, my concluding words is I want -- I just want to stress that results are coming because of certain qualities that you have to build. It's not for free. And this combination of building and, yet at the same time, delivering, that balance -- strike that balance is what I see as one of our -- my personal objectives to keep that balance going, to invest, yet at the same time, to deliver. We aim around -- et cetera. That is what guides 340,000 people. That's what we, altogether, want to deliver. We're going to work for that, and we're going to do that, again, in this consistency, I would say, and balance that Nestlé has been characterized for. We will keep that, a lot of energy going into that, too. So with that, I want to thank you, all, for having shared this time with us and show interest in our company. And well, see you then in next occasion. So thank you very much.

Thank you, Paul. As usual, we're happy to take any follow-up questions via email or Twitter. I'm sure you know the addresses. Thank you very much.