Good morning, ladies and gentlemen, and welcome to Pernod Ricard First Half Sales and Results Call. We're hosted this morning by Alexandre Ricard, our Chairman and CEO, and Helene de Tissot, our EVP, Finance, Production and IT. We'll take you through the presentation and then take your questions. Alexandre, over to you.

Thank you very much, Julia. And good morning ladies and gentlemen. Let's start right away with our executive summary. So our first half of this fiscal year 2021 confirms the sustainable business strength, with growth returning in our must-win domestic markets. Overall, over the H1, our organic sales have declined by roughly 4%. And our profit from recurring operations has declined organically by roughly 2.5%. The reported profit from recurring operations is down roughly 11%, and this is due to negative currency impacts. The key messages here are we continue to implement and more importantly so deliver our transform and accelerate strategic priorities. Talking about our must-win domestic markets, strong growth in the U.S. plus 5% over the first half. Return to very strong growth in China with double-digit growth of plus 13%. And return to growth in India over the second quarter, up plus 2% and over the first half still down by 6%. We're gaining, we're holding share in our key markets, notably in Europe, despite on-trade disruption. We continue our dynamic portfolio management, and you can see that innovation has been a key growth driver with plus 10% for our innovation portfolio. Obviously very important, we continue to drive our 2030 sustainability and responsibility roadmap, with significant progress in a number of areas in particular in packaging. And last but clearly not least, we continue to accelerate our digital transformation across all functions. We've displayed a lot of flexibility and agility in managing the COVID impact, I think the key words here are dynamic management of our resources. Of course, our number one priority is about the health, the wellness, and the safety of all our employees and of our business partners. Trouble retail has been managing resources extremely effectively. A&P has been tightly managed and actively redeployed depending on the market, the channel opportunity and of course, the reality, in other words, the constraints in the feasibility. And we'll talk about this later on. Operational excellence has been driving a number of savings. We've maintained a very strict discipline regarding structure costs. And as I said, the key word is all about dynamically managing our resources, which in fact, if I move on to the second slide, has generated a slight improvement in our operating margin for the first half, up 51 basis points at 32%. If I look at our sales, well, H1 sales trends continue to improve. And by the way, our business has grown globally if we exclude travel retail. Excluding travel retail, our business would have been up organically by 1%. However, this of course, includes some travel retail sales that have been compensated by domestic consumption. So it's important to bear this in mind. If you look at the regions, Americas up 2%, Asia, rest of the world down 6%, Europe down 5%. From a brand perspective point-of-view, our strategic international brands are down 6%. We'll see this later in detail. Strategic local brands down 4%, specialty brands continue to be extremely dynamic, and by the way, confirming our dynamic management of portfolio they're up 22%, and strategic wines are up 3% over the first half of our fiscal year, and Q2 is down 2.4%. [Technical Difficulty] On our value creation levers, as I mentioned it in the exact summary, innovation has driven 10% of our - innovation portfolio has grown by 10% over the last few months or year and half or so. We've proceeded with the acquisition of Petroni in the aperitif segment, specifically in Spain, partnership with the fast-growing super premium is called Ojo de Tigre in Mexico and being developed in the U.S. And of course, strong contribution of the recently acquired brands to our supplying growth with triple-digit growth for Malfy, The Gin, and very strong double-digit growth for our American Whiskey portfolio. Innovation is in double-digit growth and is driving as well premiumization. I cannot, not speak about Lillet which is up 35%, which is clearly driving a lot of growth for Pernod Ricard, and not just in Germany where it all started or in France, but across many, many markets knowing that Lillet is now a global big brand for Pernod Ricard. Our TD is also extremely dynamic up 70%, and we continue to invest behind Low/No Alcohol true innovation, with the recent launch of Beefeater Light, or the acquisition of Ceder's, which is a 0% percent alcohol gin. Moving on, very important, critical something we've decided and rightly so to even accelerate during the COVID crisis is our digital transformation. We made some strong progress on our key digital projects in core markets. I will only cover three initiatives, but there are a number of other initiatives as well, but the three I would say important ones. Number one, Matrix, which is all about marketing effectiveness. So, leveraging internal and external data to optimize through artificial intelligence and algorithms, basically the effectiveness of where we invest our money to optimize the return of investment of that money. Second, key digital project which we have named D-Star, which basically is all about powerful data enriched insights for our sales team. So, unlocking the power of our sales team around the world to enrich data impact and value creating data for them. And finally, well RGM, revenue growth management, we've called it Rev'up, it's all about promotional effectiveness and using data promotions, which we enrich in a very continuous manner and which will be infinite by a way to optimize as well our promotional activities from a frequency point of view, from a debt point of view, from a type point of view, from a timing point of view and so on and so forth. So acceleration of our digital transformation which we're currently undergoing as we speak. Speaking of digital transformation, part of it as well from a channel point of view and activity point of view is about e-commerce. We've seen of course, as many the acceleration of e-commerce trends. This was a trend already existing before the COVID crisis and that has accelerated due to the COVID crisis. And you see here that our e-commerce channel has grown 63% over the first half, and if you look at our top four markets which account for roughly 80% of our sales and e-commerce, you'll see that China which is probably our largest e-commerce market has grown by 46%. USA has seen e-commerce grow by 84%. The UK has seen e-commerce grow by a whopping 138%, and last but not least, France has seen very strong growth of e-commerce up 56%. We have our own ecommerce platform, our B2C platform, which has seen online sales delivering consistent growth already last year and at the peak of the pandemic in Q4 of last year. Now, if you look at the first half of this fiscal year, likewise, Drinks&Co is up 60%. We've upped our game in terms of activations within the digital area. And you have here on this slide a number of examples. If I move on to the sales analysis by market, well, again, you'll see Americas, so Americas up 2% over the first half. Asia, rest of the world, as I mentioned, minus 6%, Europe minus 5%. All this leading to minus 4% over the first half. Let's start with our largest must win market, the USA, where we've gone through strong growth and driven clearly by a dynamic off-trade performance. We've grown in line with the market by channel. So very strong performance in the off-trade. Market share maintained in the on-trade and e-commerce has boomed up 84%. We have an over exposure or should I say we over index in the on-trade in the U.S., which is still significantly down. But overall, we're broadly in line with the market, the USA is up 5%. From a Brands point of view, if you look at Jameson, these are the six months to January 23, Nielsen Panels up 18%, likewise for NABCA, which also covers the on-trade, and this is why, in most cases, not all, you'll see lower numbers here. So Jameson and NABCA, which combines off-trade and on-trade and knowing that a Jameson is overexposed to the on-trade, NABCA number is up plus 1%, which is still a strong performance driven by Jameson Original, but also enhanced by the super-premium Jameson Black Barrel and Cold Brew is continuing to develop. Glenlivet up 25%, and Nielsen up 15% on NABCA. So continued strong momentum for the Glenlivet enhanced by innovation. Of course, Avion and Altos surfing on the dynamic tequila segment, especially at super premium plus levels. You have here the numbers. Both brands are in strong double digit growth. I'll just note that we have slightly increased our prices on Altos in H1. Jefferson's, which we acquired exactly, I think 14 months ago. Jefferson is also up strong double digit growth, which is great. Significantly outperforming the category. Martell up 18%, and Nielsen up 65%, on NABCA, with solid underlying growth and supported by the off-trade dynamism. Very strong and continued performance of Malibu up double digit, very strong and continued strong performance as well for our future growth relays, speaking of American Whiskey beyond as well Jefferson with Rabbit Hole with TX, and Smooth Ambler. Of course, of Monkey 47 almost killed the leading brand Del Maguey, Malfy and Redbreast, which is one of our ultra-premium Irish Whiskeys. Absolute up 6% on Nielsen Panels, down 2% on NABCA. Strong growth in the off-premise, but the brand is significantly impacted by the on-premise disruption in a category which is still very competitive. And very dynamic performance of Kahlúa. So that's for the U.S. Moving on to China, where we underwent a 13% growth rate over the first half for China. Very strong growth confirming the recovery that we had already previously mentioned. It's fair to say that this growth is also boosted by strong selling accelerated in Q2 in preparation of the Chinese New Year. Just from an anticipation point of view, there's no phasing, so we are really, really prepared for Chinese New Year in December. That being said as well, Martell Mortel first half fell out is very strong in double digit growth, and led principally by the way by the higher mark of Cordon Bleu and XO. Should sell out a stable due to lapping Q2 of the previous year, where there was a sharp on-trade recovery, if you recall. Our growth release being the Glenlivet, Royal Salute and Absolut are all in strong growth. And the growth is diversified across all consumer touchpoints. In particular, I mentioned the e-commerce, but we're growing in old channels in China, in particular in the Australia, of course, but as well in the on-trade. Moving on to our third largest domestic market, India. As I mentioned, in the beginning, we have returned to growth in the second quarter, with 2% growth in Q2, still down 6% over the first half. The sanitary situation is improving very progressively throughout the course of the first half, and leading to easing of restrictions on public gatherings in Q2, and that's the plus 2%. The off-trade is now broadly open in most regions, and our production capacity has overall normalized during the first half. The Seagram's Indian whiskies are in decline, but we do have a slight positive mix. Due to the stronger emphasis our teams in India have put on Royal Stag and Blenders Pride in particular. Our strategic international brands have returned to growth as well, principally led by Ballantine's, Jameson, and the Glenlivet. And it's noteworthy to say that 100 Pipers is also performing well. Now, one of our must win markets is global travel retail. Global travel, retail has seen a decline of 57% over the first half of the year. Travel retail, let's be clear is still severely disrupted because of the COVID-19 restrictions. And let's be clear as well, we do expect this severe disruption to continue throughout the course of the year. If I move to Europe, I think it's important to stress the resilience of Europe in spite of the second wave, which led to on-trade restrictions across most of the markets. If I start with our largest European market France down 8%, of course, there was a new national lockdown and so on and so forth. The on-trade is significantly impacted, by the way as we speak. Sell out in the on-trade is up mid-single digit across many, many brands, but again, does not offset the very strong disruption in the country, so worthy to stress the strong performance of Mumm and [Indiscernible] in France and the good results on Ricard, which is gaining share in a tough category, which is the Anise category, and we're still quite dynamic from an innovation point of view in France. In Spain, let's be clear, double digit decline, on-trade restrictions, and by the way, a very, very severely impacted summer with a significant decline as you can imagine in tourism. That being said, we have gained shares principally driven by Gin and Absolut Vodka. UK up double digit up 13% with a continued strong performance driven by the very strong resilience of the off-trade, and driven by brands like the Glenlivet, Jameson, Absolut, Malfy and our wine business in the UK. Germany up double digit as well, plus 14% with some acceleration in the second quarter. And again, this is despite on-trade closures. And this is also driven by Lillet and Ramazzotti with a strong innovation behind the brand. Russia, double digit growth in Russia. Let's be clear, principally driven as well by phasing by strong selling in December ahead of some licensing topics. But the underlying consumption trends in Russia remains strong, nevertheless. And good growth as well in Poland, driven principally by our whiskies with a strong price mix on our strategic rent. If I look at the other key markets, while within Americas, Canada up 8% some modest growth in Brazil and good growth in Mexico. And in Asia, rest of the world, decline in Japan, clearly driven by on-trade disruptions. That being said, good performance of [indiscernible], Thanks to distribution inspection which is driving a positive mix. Korea, by the way, we're not used to these kind of numbers. While we were used to double-digit numbers, but with a minus in front of them, this time it's a plus, though. I think it's fair and fair to the team in Korea to stress it, so Korea is up 10% driven by Royal Salute, Ballantine's and Absolut, clearly focusing on the off-trade. And again, offsetting the on-trade disruptions. Southeast Asia continues to be very difficult, and this is clearly related to the sanitary crisis to very, very subdued tourism. And finally, in Africa, Middle East, while the sanitary crisis in Middle East North Africa. And new restrictions are impacting the recovery in South Africa. As you have seen we've gone through a ban as well, a number of bans, in fact, in South Africa. Continued double-digit growth in Turkey, clearly thanks to the off-trade dynamism, and also benefiting from former trouble retail sales as well in the domestic market. And fair to underlying the excellent performance in Nigeria. Very briefly, by brands, I won't go through again our house of brands. I'll dive directly into our brands, starting with our largest brand Martell. Overall Martell sales are down 3% over the first half. Martell would have been up 1%, excluding a GTR. Very important to stress the very strong performance of Martell in China. Of course, the continuation of our value strategy. As I mentioned, China double-digit growth and already on a high comparable basis last year, when COVID was not in existence yet, and a strong mix as I mentioned earlier, driven by the higher marks. You would say solid double-digit underlying growth and you have here the Nielsen and NABCA numbers 18% 65% growth, supported clearly by off-trade and distribution gains. Travel retail, as I said, difficulties, but a strong sales in Heinen [ph], as most of you probably know. Moving on to Jameson, which grew sales up 3% and again, would have been up 6%, excluding GTR, which is a big channel for Jameson. So USA strong growth in the off-trade. Clearly, the continued strong development, I mentioned it already of our super premium Jameson with Jameson Black Barrel. And of course, Jameson suffering from its higher exposure to the on-trade. In Europe, mid-single-digit growth driven a bit everywhere, with a positive price and mix coming in Eastern Europe, and very strong share gains in Germany and the UK. And in other markets, while continued good performance in Africa, Middle East, acceleration in India and dynamism in the Pacific region. If I move on to Absolut, down 12% clearly impacted by its very strong exposure to both travel retail and on-trade channels across the world. If I start with rest of the world, very good growth in the UK and Europe, but as well in Russia and Germany. In Asia overall stable with good growth in China and Korea, as I mentioned earlier on and as well in India, which offsets decline in Thailand, clearly due to lower tourism as I mentioned as well before. Africa and Middle East, clearly impacted by the lockdowns in South Africa and as well, strong disruptions in North Africa. And finally, market share gains in mature markets overall and in Brazil in particular. In the U.S., the brand Absolut is up 6% and the Nielsen Panels down 2% and this is the NABCA sell out. So, we continue to authentically connect with consumers at very cultural relevant moments, and it is starting to pay dividends, especially in the off-trade where it's been quite dynamic. But again, the brand is suffering from its exposure to the on-trade. Now moving on to our last and clearly not least big category, which is Scotch, which is down 10%, but would have been up 2%, excluding GTR. Here we can note the very strong resilience of our single malts, but blended scotch is clearly impacted by on-trade and travel retail. Glenlivet performing really extremely well overall 2% over the first half, and you even have the numbers in the U.S. I already mentioned them. Chivas is down 16% clearly led by travel retail and trade restrictions in Japan, which is one of its largest markets. But on the other hand, you have double digit growth, or the pursuit of double-digit growth of Chivas in Turkey. You have strong growth in the U.S., in Russia and the UK. Successes of blend is really being amplified in a number of markets. Ballantine's down 12% however, double digit growth in Eastern Europe, India, Turkey, Brazil, but again, travel retail Asia, especially on the higher marks Ballantine's 17, 21 and 30 is impacting the brand's value performance. And I would say roughly the same thing for Royal Salute, which is down 20%. Despite strong growth in domestic markets, and the brands key or strategic domestic markets, starting with China, Korea and Taiwan. And good performance by the way, worthwhile noting in the U.S. in line with our luxury strategy. Regarding the other key brands, I won't dwell too much upon them, Beefeater down 20%, principally related to Spain, which is its largest market. Havana Club down 9%, again, hit by a number of markets and on-trade exposure. Malibu, very strong growth post 26%, Ricard minus 5%, which is a strong relative performance. Mumm as well with minus 5% is a strong relative performance. And PJ down at 90%, despite growth in Japan, but again, decline in the U.S. and Western Europe, for obvious reasons. And again, our strategic wines up 3% starting with Perrier-Jouët, which is still undergoing double digit growth, both in two key markets being the USA and the UK. Specialty brands I mentioned up 22%. So, I won't dwell upon it. We're extremely happy with the performance of our specialty brand portfolio. I'd like to move on to something which as well, I was mentioning earlier on the fact that we clearly accelerated on our digital transformation, which is part of our transform and accelerate strategy, even before the COVID crisis hit. Likewise, sustainability and responsibility which is at the core, at the heart of everything we do. Remember, we had presented our good times from a good place strategic roadmap in March of 2019. While we've decided as well here to even accelerate, I think the sustainability and responsibility theme has gained significant importance and momentum because of the crisis. And frankly, it is a good thing. As you recall, we have four key pillars on our strategic roadmap, the first one being Nurturing Terroir, and here you have one example, amongst many of initiatives we have around sustainable agriculture through strong partnerships. This example is specifically in Ireland regarding sustainable green spray barley scheme, and when we have at this stage partnered with more than 200 farmers. Our second big strategic pillar within our sustainability and responsibility road map is valuing our people. And again, very strong initiative around supporting communities. We've named two big ones and Kudos to our PR USA team to our American team regarding the support around the Black Lives Matters theme, and also about their initiative around engage responsibly with the first, the first ever business to consumer, human centric, open source, globally scalable solution to fight against online hate speech is a first ever gathering strong momentum across industries with many companies that are participating. And again, Kudos to our team in the U.S. for having taken lead on such an important, very important topic. The third pillar, circular making, where we've made very strong progress towards sustainable packaging targets. And by the way, we have accelerated. As we mentioned it also previously, we set ourselves a clear target to achieve no single use plastic, a point of sale material after June 2021. This is a clear step up and acceleration. Our initial target was 2025 and is now June 2021, in other words, tomorrow. New sustainable packaging panel and dedicated eco pack tool to ensure global alignment. I was going to say just with name one of them, but I'll name two of them. The first one is, well, the 100% recyclable Beefeater, by the way, it's amazing to see the impact these initiatives can have. Basically, this is the equivalent of 400 tonnes of plastic saved annually, thanks to just one thing, the removal of the plastic caps and plastic labels. 400 tonnes of plastic saved on an annual basis. I have to say that when I saw that number, I called my e-commerce team and said, did you make a mistake? Is it 4 tonnes, 40 tonnes, no, it's 400 tonnes. You may have seen for those who follow Absolut on social media, the innovative paper bottle, which by the way has been done in conjunction as well with other players in other industries. And as well the limited-edition squirrel bottle, which is done produced with 60% recycled glass, and many other initiatives. Listen, this is this is something which is close to our hearts, steer to our teams, and which is clearly going in the right direction at an accelerated pace. The fourth and last pillar, which is very specific to our industry, to the spirits industry, it's all about, of course about responsible posting. Tackling alcohol misuse, you may know, we already communicated on it. But we have launched a mandatory MOOC, massive online course, for all our employees, no exception. We also have our global responsible drinking charter, which we all must abide by, and many other initiatives, I won't go through all of them. But again, very important and very specific to our industry, especially during the current times. So, having finished that first section, I'd like to pass on to Helene de Tissot to talk about our financial performance during the course of our first half.

Thank you very much, Alex, and good morning to all. So let's start by the group income statement. So as you mentioned, Alex the top-line is down minus 2.4% organically and minus 10.8% from reported point-of-view with significant negative effects impact. This organic performance is translating so with an improvement of margin improvement by 51 bps despite the sales decline of minus 4%. Thanks to dynamic management of resources and favorable phasing. Let's start with the gross margin. So gross margin is down minus 5% contracting 108 basis points, driven by sub pricing with pure price increases on a solid comparable basis. Last year, our prices on strategic plans were growing by 2%, and benefiting mainly from the previous year, Martell price increases. We are as well suffering from some adverse mix in the first half, primarily linked to the decline in travel retail and some higher cost of goods, mainly from continued agave cost pressures and lower fixed cost absorption, offset by the continuation of operational excellence initiatives. Moving to the A&P, they are down 12% versus last year, contributing to the margin improvement by 132 basis points. This is resulting from the proper based investment approach that we've been following since COVID, with a strong reduction in markets and channels, we've subdued demand and as well some favourable phasing. We are expecting the ratio of our business sales to move to 16% for the full year '21, with a strong double digit increase in H2. Structure costs are down 6%, contributing to 27 basis points to the margin improvement, which is a fair reflection of the dynamic management of resources that we have been implementing, with a very strong discipline in all markets, and as well, the fiscal year 2020 reorganizations. Coming now to the negative FX impact. So this is impacting our profit from weakening operation by €155 million due to the U.S. dollar depreciation versus euro, but as well to the emerging market currency depreciation versus Euro. We expect a significant negative effects impact for this fiscal year '21. Moving now to the regional view, starting with Americas. So our profit from recurring operation is growing by 5% with a margin improvement, reflecting tight resource management and hence by phasing. So gross margin contracting by 80 basis points, driven by adverse mix. Linked in particular to a channel and format negative mix in the U.S., less travel retail share and continued agave cost pressure. The A&P are down 6% in that region, contributing to 150 basis points to the margin improvement. Reflecting this purpose-based approach, I was just referring to, we are increasing investments in the U.S. This is our number one market and a top priority with strong reallocations, reflecting opportunities and continued thought behind brand, like Jameson and d growth relays. Our structure costs are down 3% contributing to 62 basis point, reflecting the tight resource management in the COVID context. And again, a strong negative FX impact of €65 million impacting our bottom line, due mainly to the U.S. dollar depreciation versus euro and to a lesser extent to the Brazilian real. Moving now to Asia, the rest of the world. So our profit from recurring operation down 11%, which is triggering a margin decline resulting mainly from gross margin pressure. So gross margin contraction with a decrease of 8%, translating into erosion of the ratio of 140 basis points, which is mainly due to adverse market mix travel retail declining. A&P minus 10%, contributing to 60 bps, which is reflecting cautious investment in market impacted by COVID. But again, with a very different picture depending on the markets, we are investing strongly in China. Structural costs are growing by 3%, which is mainly due to a negative one-off costs, because we are as well in Asia and rest of the world, as everywhere in the group, tightly managing our structure costs there. Adverse emerging market effects impact, as I mentioned, which is mainly coming from the Turkish Lira, Indian Rupee and Chinese RMB. Moving now to Europe, where the profit from recurring operations growing by 5%. We have a continued resilience in top line that was already detailed by Alex. So very significant organic operating margin improvement. Thanks to very tight resource management. Gross margin is contracting, you may need to address market mix, especially due to Spain. A&P decreasing by 23% as a result of cautious investment in markets impacted by COVID, in particular in region, as you know where we had some ongoing restrictions in the country channel across the region due to the sanitary situation. Structure costs are decreasing by 16% contributing to 210 basis points to the margin improvement, again, with the continuation of strict operating guidelines and the positive impact of efficiencies initiative that were put in place in terms of organization in that, in that region, adverse effects impact mainly from the Russian Ruble impacting our performance in Europe. Moving out to the net profit, starting with the earnings per share view, so, €4.16 for the first half, which is down minus 9%, reflecting the decline in profit from recurring operation and the positive impact of the share buyback that was done in fiscal year '20. So, financial expenses for returning operations better by €14 million versus the previous year, mainly due to the successful debt liability management that we did, starting by the way in fiscal year '20. But with as well as very successful U.S. dollar bond debt refinancing and backing for driving a decrease of the average cost of debt to 3.2% from 3.7% the year before. Our tax rate on recurring items is now at 23.4% compared to 24.2% in each one last year, due to the reduction in French corporate income tax rate and geographical mix. And we have the decreasing number of shares I was referring to which is mainly obviously due to the share buyback program that was put in place in fiscal year '20 and which has resulted in share consolation in distress for fiscal year '21. Moving now to the non-recurring items, so starting with non-recurring expenses at minus €61 million, driven by significant reorganization costs €64 million expenses, reflecting the ongoing adaptation of our organization. Non-recurring financial results of €103 million expenses mainly due to the one-off costs relating to the early redemption of U.S. dollar debt, the Make Whole goal [ph] in the context of the successful liability management, and as well some foreign exchange impact. And €44 million positive tax on non-recurring items, driven mainly by a tax effect on non-recurring items, notably, the deductibility under Make Whole Goal. If I move on to the group share of net profits, which is minus 6%, reflecting the decline in profits from recurring operations, partially offset by lower non-recurring and corporate tax items. Moving now to the cash performance, although distressed first half and the and net debt evolution, starting with the cash flow statement and with the recurring operating cash flow, which amounts to 1.2% €68 million. [ph] So, you have to hear all the figures that I suggest. To comment to the following slide with a very strong cash delivery in H1 and free cash flow of €835 million, which is plus 36% versus the previous year. So, this is due to a recurring free cash flow at €995 million and growing by 59%, resulting from declining profit from recurring operations that already commented. A significant improvement in operating working capital requirements due to inventory normalization and payables rebuilt versus June, leading to a very strong cash conversion for distressed half at 79%. Low increase in strategic inventories versus last year mainly reflecting COVID impact and active cash management with stable CapEx, lower financial costs driven by a lower average cost of debt at 3.2% was already commenting from the P&L point of view. We have the cash benefit here. So again, linked to the successful refinancing of the U.S. dollar bond debt. A significant reduction in cash tax bringing improvement of €103 million, which is reflecting the COVID impact on business profit and as well as differences in timing of prepayment, repayment in a geography. Non-recurring free cash flow at minus €160 million, due mainly to the restructuring cost linking particular to the reorganization that we're putting in place in France in our wine business. And as well our financial expenditures due to this one-off cost that I commented already, and we hope that will stage back in November. So let's look now at the evolution of our net debt. Our net debt is close to €8 billion at the end of December, which is translating into reduction of the debt of €443 million in this half. Thanks to stronger free cash flow and positive effects on our debt. So stronger free cash flow that I already commented with this improved working capital need, lower tax and financial expenses, partly offset by higher non-recurring items. We have as well limited M&A cash out in the first half. Lower dividend payment and just as the previous year which is reflecting a stable payout ratio that's lower and profit last year, resulting from the pandemic impact. Suspension of the share buyback program that we did back in April, and again, a significant positive FX impact of €406 million on our debt which is mainly due to the euro strengthening versus U.S. dollar. And now, back to you Alex for the conclusion and outlook.

Thank you, Helene. So, regarding the conclusion very clearly our first half reflects the sustainability of our business strength, with growth as you've seen returning in our must win domestic markets, and with agility regarding the management of the crisis, especially in terms of the way we have managed our resources. For the full fiscal year 2021, we expect sales to return to growth organically. Thanks in particular to the dynamism of the U.S. China and India. Now that being said, I think it's very important to stress the continued uncertainty and volatility of the environment in particular, obviously relating to the sanitary and economic conditions, with clearly a prolonged downturn in travel retail for sure, and with continued on-trade disruption across many markets. We will continue to implement our strategy with as I mentioned earlier the acceleration of our digital transformation. And again, we will continue to very dynamically manage our resources with strong reinvestments where efficient and here as well as Helene mentioned it earlier, we will be back to growth regarding A&P, a significant growth as we expect the ratio to be at 16% for the full year. And on that note, I'm passing back to Julia.

Thank you, Helene and Alexandre. And we'll now turn to your questions please.

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] And we have some questions from the English audience. The first one is from Simon Hales from Citi. Please ask your question, your line is open.

Thank you. Good morning, Alex. Good morning, Helene. A couple of questions please. Could I just ask about the U.S. of your solid mid-single-digit performance in the first half? I just want to confirm that the plus 5% sales number you reported and that the depletion growth was also around 5% level i.e. with no stock replenishment in that number. And maybe linked to that, could you say something about how you'll stop levels out generally with your wholesale in the U.S. at the moment and how that may have evolved through the second half? And then secondly, can I come back to China. Just to clarify, Alex, I think you said in your comments that you sold into Chinese New Year during Q2. So I assume, it's right to assume there weren't be any phasing benefits at all for Chinese New Year in Q3. And again linked to that is there any recent anecdotes or feedback you can share from your wholesalers on the ground as to how they're thinking about the run into Chinese New Year this year, given some of the press commentary we've seen around regional lockdowns being repurposed and obviously government advice not to travel over the holidays, if at all possible. So any color there would be very useful. Thanks.

Thank you for your two questions, Simon. If I were extremely speedy, the answer to one is yes. The answer to two is no. So I'll detail a little bit. So on your first question, yes. Underlying is five for us so, five in line, depletions are in line with that number. And regarding stock levels, absolutely normative. Usually, I would say broadly normative. They're absolutely normative. They are perfectly in line. Regarding China, basically, no, there won't be any phasing. We sold in through our wholesalers in November and specifically in December, to make sure we were fully ready for Chinese New Year. Now, Chinese New Year is tomorrow, by the way enjoy for those who are in Asia. Listen, I'll say sentiment from my point of view is cautiously optimistic. It's difficult to say plus, say more because our brands are exactly where they should be on shelves. So the pipe is rightfully filled. Now the one data we do not have, and that nobody has yet is consumer intake, which has started to happen a few days ago. The festive season is starting today, by the way and will last a couple of weeks. We will start having real data driven feedback by at the earliest by the end of March, if not early April. So in the meantime, I would say we're cautiously optimistic. Indeed, we read the same media you read. There are a number of restrictions. I think bank would think - by the way that the bank would think restrictions would make us dream in Europe. I think restrictions are limited to 40 people. In France its six, I don't know for information. That being said, it's fair to say that during normal times banqueting can go up to 1000 people also 40 for China is a severe restriction, but the on-trade is fully open, people are going out. There might be a little bit of less domestic traveling as anticipated. So at this point in time, I would say we're cautiously optimistic.

That's very useful. Can I just sort of one quick follow on? Obviously in the first half, you were able to deliver some operational leverage through the P&L. As we look into the second half of the year, you're obviously going to see a stronger sales recovery, but A&P phasing now stepping up a little bit, maybe structure costs started to come back in. Do you still think for the full year you'll be able to deliver positive operational leverage or positive organic margin expansion?

Okay, so actually you gave the answer to the question. Thank you. As you rightly mentioned, the margin were slightly improving in H1. Having said that, full year '21 is a year of recovery. So it's fair to expect that delivering leverage will be difficult. Starting with pricing, the environment makes it quite subdued currently. And it's been obviously a key driver for leverage in the past. We have as well, some negative mix coming from a channel formats and obviously the impacts of the prolonged downturn in travel retail that we believe will remain for the full year. There is some pressure in terms of cost. As you rightly mentioned, we expect a quite different shape of the A&P for the second half to get to what we believe is the right level of investment for the full year. We expect 32% [ph] indication, income of ratio. And when it comes to structure cost, on this one, I would say, you can expect the same cost management for the weeks to come in terms of very strict discipline, but we're going to have a different comparable basis, because obviously we were, let's say, starting probably end of Jan and early February in Asia and travel retail and everywhere in the group, end of March, having some very strict as well. And discipline last year, plus some technicalities linked to the bonus cuts that were materializing in H2. So, all in all, again, probably difficult to deliver leverage in fiscal year '21.

That's great, Helene. Thanks so much. Thanks, Alex.

Thank you. Our next question comes from the line of Edward Mundy from Jefferies. Please ask your question. Your line is now open.

Morning, Alex. Morning, Helene. Three please. The first is on the A&P step up that you're flagging in the second half, is this largely due to phasing? Or are you seeing green shoots in the business? What gives you the confidence to have the big acceleration in A&P? The second question is on Jameson in the U.S., which, as you said, has been held back by a weak on-trade where they over indexed relative to the rest of the market. Could you show your degree of confidence in Jameson accelerating as the on-trade comes back? And then the third question is around some of these new launches with Ballantine's Light and Beefeater Lights in Spain. I was wondering if you could share some early feedback on that. And does this give you more confidence to roll these brands out to other markets and across other brand franchises as well?

So maybe I'll start with A&P. So well, I would say it's a bit of what you mentioned. Phasing obviously, but as well it's really depending on the dynamism of our respective market, because obviously this 16% is an average, people will be very contrasted trends depending on the market. So we are already in an industry that has increasing our investment in some of our key must win. And like the U.S., China and India. But India returning to growth in Q2. So you can expect our investment in those three geographies to keep accelerating in the second half, obviously depending on the underlying demand. But that should be a part of our increase. And then for the other geographies, this will be obviously strongly as well connected to the on-trade reopening and all the recovery that we will be capturing. So that's what I can say for A&P.

And on your question, Ed, regarding Jameson in the U.S. Well, Jameson is clearly overall suffering from its over exposure to the on-trade. That being said, the brand is doing particularly well. And if you look at off-trade, for instance, if I look at the very latest off-trade panels - of Nielsen Panels, which are off-trade, which are quite recent from yesterday, so up to 30th of January, you'll see that the brand franchise over the last four weeks is up 40%, of which Jameson Original is up 18%, basically Black Barrel is in the mid-20s to 30s. And in fact, to give you a more consistent number, if you look at Jameson off-trade performance since March 7th, which is when the COVID crisis hit the U.S., it's up 26%, which Original is up 22%, which means by Barrel is probably in the 30s. So this translates a very strong dynamism around the brands franchise. Of course, Original is still doing very well. The whole franchise is led by Black Barrel, which is great news from a super-premium plus and value mix point of view. And as well, as I mentioned during the presentation, the continued development of a Cold Brew, which unfortunately but that's a fact of life. We launched, I think it was a week or two just before the COVID crisis. But the brand has been very well received in the market in the U.S. So, of course, as the on-trade gets less disrupted, of course, we believe Jameson will pick up again in the on-trade. Right now, the on-trade in the U.S. is down in the 40s, 50% and is still heavily disrupted. So we're currently focusing, obviously, our investments towards the off-trade behind Jameson, and it's proving to be the right strategy. And finally, on Beefeater Light and Ballantine's Light, it's an innovation, I fundamentally welcome which plays in this lower alcohol type trend for some people, for some consumers. It doesn't mean that our core consumers dislike the core brands, they're still there. It's just to increase our consumption base. They've been lunched in Spain, but very recently, so it's a little bit early to tell. The one thing I can share with you, which is, always the first thing we try and get in terms of feedback is the trade feedback to our teams on the ground. And in particular, our customers have welcomed these two new innovations, which are bold innovations, because we're using very strong franchises, our Beefeater is the market leader, with a strong franchise in Spain. So, we'll have more information, probably at our next financial meeting. So please, stay tuned.

Great. Thank you.

Thank you. And our next question comes from the line of Sanjeet Aujla from Credit Suisse. Please ask your question. Your line is open.

Hi, Alex. And then a couple of questions for me please. Firstly, on the on the U.S. and coming back to the point on stock levels. I think in your Q4 last year, you saw significant destocking in the U.S., particularly after St. Patrick's Day. I guess, given how the channel mix is shaping up over the next couple of quarters, would you expect to get a restock benefit, as we look into Q4 this year, in the U.S.? And then just another follow-up on the U.S., you're clearly, you're getting strong growth out of [indiscernible], particularly with Avion. I think you're still under indexing that category relative to the industry. Do you see that as a gap that that needs to be addressed in terms of your sort of long-term ambition to drive growth ahead of the market?

Let me just start with the first question on the stock level. So, as we mentioned at the end of December, stock broadly normative everywhere, by the way, but quite normalized in U.S. You rightly mentioned, we had some buy back stock last year in Q4, which was largely due to the let's say, a very brutal stop of the on-trade back in March, which was obviously creating some abnormal level of stuff that we tried to help normalizing by buying back these stock from our wholesalers. So, what we said and I think we can obviously confirm that is that you should expect Selinico [ph] sell out for us in the U.S., we don't want to restock. Having said that, the trend for H2, it's a bit early to tell you what it's going to be. There is obviously uncertainty around the reopening of the on-trade. We are going to lock the very significant pantry load that took place starting end of March into probably the end of April. And we don't want to restock. I think that's what I can say right now.

Regarding your question on Avion, in fact, I'll enlarge it to what I call the agave based premium spirits which is a category, which is obviously very dynamic, one of the fastest segments right now in the U.S., where we play with as you said Avion by the way with the Avion range [indiscernible] and reserve of 44 which is $100 plus prestige proposition for Avion, where we also play with tequila outdoors which is more in the super premium positioning in the mid-20s in terms of dollars. But as well with some midscale brands with the leading brand Del Maguey and more recently through a partnership with - this brand called, Ojo de Tigre. All these brands are performing very dynamically. Again, If I look at mid-March to now performance, you see Altos that has grown roughly 60%, you see Avion that has grown roughly 64%, and you see Del Maguey that has grown 71%. But you're right, we under index in this category, which right now, is a bit unfortunate, because it's a fast growing one. But we're also present in other categories that are quite dynamic as well. What I'll mention is we are investing and just to add to one point that Helen said earlier, this is a typical example of where we're going to step up our investments tequila in the U.S. media investments, heavy on Altos to accelerate the growth there. And who knows, we will pursue our dynamic management of portfolio. If there are any bolt-on opportunities in agave in the agave space, we will look at them or we have in the past. By the way, Avion is an acquisition, by the way Del Maguey is an acquisition, and by the way of Ojo de Tigre is a partnership. But we under indexed in the tequila category, that's clear.

Great. Thank you, Alex.

Thank you. Our next question comes from the line of Laurence Whyatt from Barclays. Please ask your question. Your line is open.

Hi, good morning, everyone. Thanks very much for the questions. Three from me if that's okay. The first one on India, there are a lot of tax increases that went through over the summer. And we're expecting to see an impact of those on pricing which understand went up by about 15% or 20%. Given, you now got growth in India in Q2, are you seeing any volume impact from that price increase or has it been largely just gone unnoticed by the market? The second question again on A&P. You mentioned that part of the A&P reduction was due to largely on-trade closures. Is it all to do with on-trade closures? Or has there been other efficiencies? I was just wondering if you could quantify how much was down to each one. And then finally, we're at the half year stage and don't have any profit guidance that Pernod often give at this stage. But what's holding you back from giving guidance? Is that largely due to uncertainties around on-trade and COVID? Or uncertainties around Chinese New Year or what are you looking for in particular? Thank you very much.

So thank you. I'll start with India. So as you rightly mentioned, there was some significant increase in taxes. By the way, probably as soon as May at the end of the six weeks full lockdown that was put in place in India. We call them corona taxes. And they are probably a bit lower than last time we talked. We are right now more talking about the range of 10% to 15% impact on our consumer prices, because of those taxes that are supposed to be temporary. And the situation is obviously very different from one stage to the other. So this is impacting our volumes in those states. But having said that, as you rightly mentioned, we are back to growth, which is obviously quite positive for the months to come. The A&P question, so I think as you mentioned, obviously, we want to be very flexible and agile in terms of A&P investments, which means that our spend are really adapted to the environment. You mentioned the on-trade closures, which is obviously one key factor. Another one is travel retail, we've been reducing very significantly in being the channel which makes sense. And as you mentioned, as well, we are obviously looking for efficiency. And to be sure that our spend is done where it makes sense from a strategic point-of-view and effectiveness, and as well obviously in terms of ROI. By the way, our digital transformation is going to help and is helping already into markets to really drive efficiency from A&P investments. Back to you for the guidance, Alex.

Yes. We gave a guidance, it's just not a numbered guidance. The reality is, to be fair, why actually put off our guidance is that the environment is still uncertain and volatile. The sanitary situation, as you can see, is far from stabilized and there have been recent new lockdowns. As I mentioned earlier during a question on Chinese New Year, it's still too early to have a clear view on Chinese New Year. We're cautiously optimistic. The vaccines deployment is taking time. So, I think it will be more prudent to share with you a guidance at some point in time when we'll have enough visibility to give you a reliable indication. Until then, we need to focus on managing through the crisis on one side and keeping on our transformation agenda on the other. But overall, again I feel quite comfortable navigating without a guidance, because of the frankly demonstrated resilience of the business fundamentals.

Understood. Thank you. And just a follow-up on the A&P question. It looks like, if we were to get back to the 16% level of A&P throughout the year which meets somewhere in the reach of around 18% of sales A&P in the second half, which would be well in excess of anything, we've seen post the changes in IFRS. And given, you mentioned on-trade closures and travel retail reduction have been an impact. Though, they're likely to remain in place for much of the first half, why do you think you are going to get back to that 16% level which as I understand is your long-term expectation for A&P despite the fact that there's going to be so much on-trade closures and travel retail impact throughout the second half of this year?

Well, first I would like to say, we mentioned 16%, it's not a target. It's more an indication of what could be the shape of the A&P for the full year and so, obviously these were some phasing between H1 and H2, so we know already some of the activation that are going to take place in the weeks to come. As you mentioned obviously, the intention is that to spend in a market which would be very much on-trade exposed, if the on-trade is in very severe restrictions. So, it's depending on our brand strategy in the different markets. We are back to growth in three out of our four on-trade markets and significant growth in China and then strong growth in the U.S., so that's already let's say, great place to invest behind our brands to keep strengthening the equity of our brands and deliver our cross sell accelerated strategy in those places. So, 16% which we believe would be a fair assumption of what could we have to take for the full year with this activation to take place in H2.

Understood. Thank you.

Okay, we'll take our final two callers, please.

Thank you. Our next question comes from the line of Celine Pannuti from JP Morgan. Please ask your question. Your line is open.

Thank you, and good morning, everyone. My first question is coming back on the U.S., you mentioned you did 5% in the first half and you mentioned that you had a trade mix that impacted because it came a bit below what we saw from your peers. Could you remind us the percentage of on-trade, but more broadly, dynamic market in the U.S.? What is your expectation for market growth in the second half? Also in your second half, you alluded to tough comp in April and March. So just wanted to have a bit of a scale on what you think the market growth will be? And my second question is on digital. You said the growth was up 63%, pretty easy one. But could you remind us how big now digital was in H1 of this year and what percentage of sales it represents in China and the U.S.? Thank you.

So, thank you very much. I'll start with your question in the U.S. so maybe just to clarifying, I'll share in terms of off-trade and on-trade exposure for both channels. And I'm going to give you figures pre-COVID. So what we mentioned by the year let's say, our index on-trade is this translation is that we often believe it's a 25% on-trade, 75% off-trade, where the market is probably more let's say 20:80 in terms of split between channels. So, our performance is in line with the market by channel and we believe that the off-trade channel is probably growing, let's say in the 20s very strong growth. And we are at least in line with that performance and the on-trade is probably down in the 40s. And that's what we are as well delivering in terms of performance. That's where we get to this and plus 5% being on translation of this performance in line by channels. When it comes to your second question, which is what to expect in terms of trends are for the marketing issues. So that's obviously, a very good question. So first, I would like to say it's too early to tell, there is still uncertainty obviously around the reopening of the on-trade in the U.S. As we said before, it's probably half of its capacity in value terms right now. But these very significant differences between states. And obviously, let's do expect depending on the sanitary evolution, vaccination campaign, and so on, so uncertainty there, plus the fact that the markets and so when we would be lacking this pantry load, I was referring to. So too early to tell. That said, this is a very resilient market with strong structural trends.

And regarding your question on digital, we don't share the exact numbers. But what I can say is digital is still approximately less than 5% of our total business. That being said, with 63% growth, it has been anyways, our fastest growing channel for a number of years, which has more recently accelerated. And again, China e-commerce at this stage is still much bigger in proportion of our business than is e-commerce in the U.S. for our business. But you see, China has grown 46% the U.S. 84%. And what complexifies even further giving, sharing data from that point of view is that the part of the business we do in e-commerce varies or can vary quite significantly, from one brand to another. And just to give an example, e-commerce in China is one of our number one channels for perhaps for Pernod Ricard in China. So this is where we stand at this stage. And of our total e-commerce business, more than 95% is indirect. So B2B, B2C and less than 5% is B2C. These are the numbers we can share at this stage.

Thank you.

Thank you. And our final question comes from the line of Olivier Nicolai from Goldman Sachs. Please ask your question. Your line is open.

Good morning, Alexandre, Helen and Julia. I have got three question please. Firstly, you mentioned a lower tax rate, since French corporate tax rate is going to continue to come down towards 25% by 2022. Should we assume through the reduction in federal cap tax rate and you perhaps quantify this? Secondly, in Europe, structure costs came down significantly in H1. Could you perhaps give us some example of what you've done? And how much of this reduction in structure cost is here to stay compared to what will reverse? And are there any cost benefit from your beautiful headquarters in Paris? And just lastly, just a quick follow up on the guidance. Could we expect an organic EBIT guidance in March similar to what you have announced last year, when actually it was much, much lower, I think it was around the 20th of March. So could we have a perhaps, a bit more visibility and a guidance before your Q3? And as we cannot describe it, I feel comfortable with the transforming accelerates ambitious targets of 50 to 60 bps EBIT margin improvement. Thank you.

So maybe I'll start with the question on tax. So you're perfectly right, the tax rate in France is announced to decrease over the years, as far as it's happening a bit later because of the timing of the closing of the fiscal year in June. So we are benefiting from the reduction from 34.4% to 32% in the fiscal year. And we expect tax rates for the year for the group which would be around 24% to 25%. Obviously, it's difficult to really anticipate what will be the exact geographical mix in the current environment. So, it would even more difficult to predict what the evolution of tax rate over the years, despite this change of the French tax rate, because obviously we are in many other geographies where the tax rates could be evolving. So I cannot give any more flavour for the midterm in terms of tax rate. Structure costs, so down in Europe. As we mentioned, they are down everywhere. And it's fair to say that the decrease in Europe is quite significant. And this is, again, the combination of two things, reorganisation that are delivering significant savings and the industry as you have, of course, and the [Indiscernible] project that was fully implemented 1st of July, and as well as very strict discipline in all the other geographies. So for the one that are here to stay, I would say obviously those reorganisations have been done and will deliver their savings. But as well, the improvement in our performance, because this is all about accelerating, especially with a reorganization in costs and name of the project is [Indiscernible]. And for the obviously other impacts linked to the very strict discipline, this would be as well obviously changing depending on the context, meaning that these guidelines in terms of recruitment freeze, salary freeze and full travel ban will obviously change when the situation will normalize. For the Island, thanks for the compliments. This is a beautiful place, I agree. But this is as well a great investment from the financial point of view. This is I would say at least neutral compared to the costs we used to have. As you may know, we have regrouped teams from many different locations in Paris. We have the headquarter, but as well and some of our [Indiscernible] teams, Amy, that our original teams in [Indiscernible]. So all the teams are now back together. I would say we'd be back together as soon as we can all go back to the office, with a nice let's say stabilisation of August.

Maybe on your last two questions, first of all, I'm giving a guidance. In March, we have no plans of sharing with you at this stage, a guidance in March. That being said, please mark your calendars for March 9th. There is the North America conference call with our CEO of Pure [ph] USA Ann Mukherjee. I think he will be a very, very interesting call from our largest dynamic market, the U.S. I mentioned earlier on that for instance, if I take Chinese New Year as an example, we will only have the real consumer and big data at the earliest by the end of March, if not at the beginning of April. And obviously, Chinese New Year is quite important for us. So this stage, no plans whatsoever to give a guidance in March. And by the way, I don't know what we'll do for Q3, to be honest. We'll see by then. And finally, on transform and accelerate our framework and the profitability ambition we have around transform and accelerate. Let me be very clear, our ambition is unchanged. So we still aim to implement our TNA strategy. Medium-term, of course, certain trends have been emphasized regarding convenience, home delivery. So with the very specific, I think, underlying question you asked regarding leverage, I'll go back to what Helene said earlier, don't expect this for this fiscal year. But of course, when our growth framework is back, is back into TNA intervals, remember, 4% to 7% and so on and so forth, you should expect this to deliver leverage, of course.

Thank you very much.

Ladies and gentlemen, thank you, Alexandre. Thank you, Helene. Please stay safe and we'll look forward, hopefully, to seeing you soon at some point.