Julián Díaz González - Chief Executive Officer Andreas Schneiter - Chief Financial Officer

Jon Cox - Kepler Cheuvreux SA Felix Remmers - Credit Suisse Thomas Baumann - Mirabaud Securities Limited Jean-Philippe Bertschy - Bank Vontobel AG

Thank you for the introduction. This is Julián Díaz and Andreas Schneiter participating in the call.

Welcome to the Q1 2017 result presentation. Please go to the Page 5 of the presentation, disclosed this morning in our website.

I think the best highlight of Q1 was the acceleration of organic growth reaching 7.2% in Q1. The initiatives implemented in 2016 and the normalization of operations like Brazil, Russia and Turkey, also still this large one in low season improves our overall performance, well supported by UK, U.S., South America and Europe in general.

It is also important to remark the high Dufry’s business seasonality after World Duty Free and Nuance acquisitions. During Q1 the lowest in terms of generations of revenues and EBITDA, as a consequence of the accrual of certain operational costs, and depreciation, amortization, et cetera.

Q1 is extremely affected in terms of profitability. EBITDA during the quarter grew to reach CHF 154.7 million, and cash earnings multiplied and reaching CHF 0.29 per share.

Let’s move to Page 6. Turnover reached CHF 1.7 billion in Q1, 4.7% higher than one year ago.

The main impacts of the 7.2% of organic growth were the changes in the scope minus 0.6%, due to the closing of the wholesale operation in UK acquired through Nuance. I repeat many times that our main business is and will continue to be retail, that will be like-for-like in June [ph] 2017; and the impact of FX minus 1.9% due to the negative translation of British pound and euro into Swiss franc and the positive impact of the U.S.

dollar. Gross profit margin reached 59.6% from 58.6% in Q1 2015, and mainly due to the synergies generated through the World Duty Free acquisition.

All the divisions performed well in this year. EBITDA grew by 5.6%, above turnover, reaching CHF 154.7 million, 9.1% margin, impacted by the seasonality of the business, compared with CHF 146.5 million in 2016.

Cash EPS increased significantly, being CHF 0.29 in 2017 compared with minus CHF 0.05 in 2016. Covenant net, debt/EBITDA ratio was 3.79 versus 4.5 threshold.

We have refurbished, I mentioned many times that this is a critical path in terms of driving more organic sales, 7,200 square meters of commercial space in Q1. We have total target for renovations in 2017 full year of 26,700.

We have also signed so far 23,000 square meters of new commercial space, will be opened until the end of 2017 and the first month of 2018. Most of this space will be open in 2017.

And the 23,000 are the square meters signed so far during the first quarter and still we have three quarters to go. Let’s move now to Page 7, despite calendar effect, one day less in February and Easter Q2 2017, Easter in Q1 2016, Dufry had good a performance in most of the locations in Q1.

Let’s go through the different divisions. Southern Europe and Africa, division one, turnover reached CHF 288.8 million in Q1 2017 with organic growth increasing by 2.8%; in Spain and Malta with single-digit positive growth; and Morocco, Ivory Coast, [Dufry Italy] [ph] in Italy, Turkey, and Portugal double-digit positive growth.

Division one reached double-digit positive performance during the first three weeks of April supported by Easter seasonality; double-digit positive performance in all the operations, except in Spain and Malta with single-digit positive performance. Central and Eastern Europe, division two, turnover reached CHF 415.5 million in Q1, with organic growth increasing by 8.8%.

Double-digit growth in UK, [Basal in] [ph] Switzerland, Finland, Serbia, Russia, Kazakhstan, and Armenia. Single-digit positive growth in Germany, Sweden and Bulgaria.

Negative single-digit performance in Zurich and Geneva, due to the seasonality of Easter period last year in Q1 and this year in Q2. During the first three weeks of April, double-digit positive performance in the division, all the operations UK, Switzerland, Sweden, Finland, Russia, et cetera, reaching double-digit growth.

Asia, Middle East and Australia, division three, turnover reached in Q1 were CHF 188.5 million with organic growth decreasing 0.4%. Middle East operations, Jordan and Kuwait, single-digit positive growth.

China, Macao, South Korea, Indonesia, Cambodia double-digit positive growth. Hong Kong double-digit negative performance, and Melbourne single-digit negative performance due to the renovation of most of the commercial, especially in this April that will be finished by the end of May 2017.

The closing of the operation in Mumbai and partially closed in Sri Lanka generated a negative impact in the performance of this division. During the first three weeks of April, division three performed single-digit negative growth.

With China and Middle East, Sharjah, Jordan and Kuwait single-digit positive growth; and Macao, South Korea, Indonesia, Cambodia double-digit positive growth. Also, continue the negative impact of closings in Mumbai and in Sri Lanka.

Latin America, division four, turnover reached CHF 400 million in Q1, and organic growth increased by 12.7%. Mexico, Argentina, Ecuador, Trinidad and the latest [ph] Caribbean, single-digit positive growth.

Brazil, Uruguay, Chile, Peru, Puerto Rico, Dominican Republic double-digit positive growth. During the first three weeks of April all the operations accelerated the positive growth reaching most of them double-digit positive growth.

North America, division five, turnover reached CHF 392.1 million during Q1, being organic growth 4.8%. Double-digit positive growth in U.S.

duty-free and single-digit positive growth in Canada duty-free. Duty-paid in the U.S.

also performed single-digit growth. Acceleration of growth in this division during the first three weeks of April, with good performance in all the different types of businesses.

Let’s move to Page 8 of the presentation. As I mentioned, Dufry has opened 5,600 square meters of new commercial space, locations already announced in Italy, France, Greece, Indonesia, China Chengdu, Brazil, Chile, and several new shops in the U.S.

New York, Boston, Houston, Tampa, Tucson [ph] and Phoenix. We have also renovated as I mentioned 7,200 square meters of commercial space and also at the locations for [indiscernible] to Los Angeles.

Let’s move to Page 9. 23,000 additional space signed in 2017.

Locations are Italy, Spain, Greece, Colombia in Bogotá, Pullmantur [Selsambor] [ph] cruise lines, Jamaica and several new contracts in the U.S., Phoenix, Grand Rapids, New Orleans and Des Moines are part of the additional space signed so far. The project pipeline opportunities as in the previous calls is very healthy, 32,000 square meters and negotiation or participation in tender process.

Most of this space is located in North America in division five, but also we have a very good representation of this pipeline, in Middle East 27% and Latin America 22%. Let’s move to Page 10.

The most important, one of the most important components of organic growth is very positive in forecasts, for the year 2017, 2018 and 2019, between 5% and 7%. And so far, in February 2017, the increase of number of international passengers was 7.6%.

This is obviously a significant good way for understanding the potential of the organic growth during the next quarters and during the next year. Let’s move to Page 11.

Dufry segmentation, this is one of the more relevant parts of the re-diversification [ph] strategy, Dufry by division on the right top side of this slide. Most of the, obviously, the divisions are performing well.

Let me just comment on the significant strong seasonality in Southern Europe, and in UK, Central and Eastern Europe, where we reached 25% of the sales in UK and Central Europe, this is the division number two; and 17% in Southern Europe and Africa. These two divisions are the most affected by seasonality.

Then in terms of categories, confirmation of - we are obviously very focused in personal care, personal cosmetics, confectionary and food, catering, and finally, luxury products. In all these categories, we have grown very close to 10% and in luxury growth by 16% compared with previous year.

If we move to Page 12, Dufry by channel, the acceleration of our airport sales, most of the new contract mentioned is before early in airport retail. But we are also trying to accelerate our growth in cruise lines, and in border and downtown shops as mentioned in previous calls.

Regarding Dufry by sector, impacted by the seasonality, 65% duty-free, 35 duty-paid, but we are going to see over the next quarters is an increase of the duty-paid for the seasonality explained. Let’s move to Page 13, priorities for 2017.

I think, to drive more organic growth and to continue with organic growth, acceleration is priority number one. This can be done with two different, obviously, initiatives, increasing the penetration and increasing the spend per ticket.

The initiative for driving organic growth started last year and continued this year with renovation of square meters of commercial space. This year I confirm that the initial target is to be between 26,000 and 30,000.

Then we have a significant set of actions for driving our customer experience via digital innovation, basing in four pillars: one is, first of all, understanding better of customers, through research and mystery shoppers; the second one is training all the staff and provide them with the latest technology, this is something I commented on in previous calls with the iPad technology; and then, three, omnichannel, digital experience, Red, pre-order and also the initiatives in order to improve the efficiency of the operations through digitalization, social media is going to be part of this; finally, the last pillar is digital innovation with the opening of the new store generations, i.e., we’ll comment on later now. The second target for this year is implementation of the new Business Operating Model.

There are two obviously more important issues here. One is the standardization of operations after the two transformational acquisitions and the second one is the implementation of efficiencies at the EBITDA level.

I mentioned the last time that the target for implementing this efficiencies in the P&L will be CHF 50 million [ph] around 2017 and 2018. We have started the first wave of initiatives of the Business Operating Model in 17 countries, including Australia, Switzerland, North America and South America.

And we will implement around 2017 and 2018 this Business Operating Model in all locations. EBITDA margin, will confirm the medium term, obviously target of reaching 13%, 13.5%.

The three aspects of this achievement should be number one is the reflection of the full World Duty Free synergies and financial. The work is fully confirmed.

The second one is the contribution from full implementation of the CHF 50 million [ph] of Business Operating Model efficiencies that will happen in 2017 and 2018. And finally, the full recovery of the markets where we suffer more over the past two years: Brazil, Russia, and Turkey affected markets.

And this is in fact one requirement that we don’t control. But what we have seen so far in 2017 is very positive and we are expecting good results in these locations.

And then extension of contracts, it says here key contract is not correct, after all key is a word that we use in this phrase, but this extension of contract that are not important contract under renovation or extension in 2017. What we are looking here is five specific contracts, the early ones are very small and three of them are already agreed for extension.

Then cash generation and deleverage, we confirm the medium-term leverage of below 3 net debt/EBITDA. And this is for a target that will be fully achieved in 2018, but right now, what we have is just to comment on the target in 2017.

Then Andreas, I will pass through the presentation to you.

Thank you, Julián, and good morning and good afternoon, everyone. So let’s move directly to Page 15.

Julián already talked about organic growth, so let me comment on the remaining aspects of turnover growth. First of all, changes in scope, so that includes only the wind-down of the wholesale business that we acquired as part of the Nuance transaction.

The coming second quarter will be the last quarter where we have a change in scope from that business. The other component, the FX translational effect was minus 1.9%, and we will see the details of that in a minute.

On Page 16, we show the evolution of various emerging market currencies. It is evident that the normalization have continued also in the first quarter of 2017.

Based on the current exchange rate, the Brazilian real will be stable from the third quarter onwards. The Russian ruble will have a positive effect of about 10% to 15% for the remainder of the year.

And in the case of the Argentinean peso we expect to see this moderate devaluation of Q1 also to continue for the rest of the year. Then on Page 17, we have the details of the FX translational effect as mentioned beforehand.

So compared to the fourth quarter 2016, the negative FX translational effect in the first quarter was more moderate at minus 1.9%. This was mainly driven by the lower devaluation of the British pound versus the Swiss franc.

Based on current rates, we should see a further reduction of the negative FX effect in the second quarter of 2017 and the flattish development in the second half of the year. So let’s move then to the income statement on Page 18.

As an introductory remark, I would like to highlight that the first quarter is always the lowest quarter of the year, and as such it has the lowest profitability and any fixed costs have relatively higher weight. We already discussed turnover, so let’s focus on the lines below.

For the gross-margin improvement was driven by the synergies of the World Duty Free integration. Over the full year 2017, we expect gross margin [essentially to contribute approximately CHF 14 million] [ph], additionally, so which would translate roughly into 0.5 percentage point of margin.

Concession fees increased by 0.9 percentage points compared to the first quarter 2016. Now, although there is some seasonality in the cost item, if we use the full-year 2016 concession fee as a benchmark, the increase is 0.1 percentage point.

And as such, the first quarter 2017 is in line with the development of the business generally. Personnel and general expenses as a percentage of turnover remained unchanged, as the higher relative weight of the fixed cost compensated for the synergies.

So we expect that the remaining synergies from World Duty Free integration will be visible in the financials in the coming quarter. As a result, EBITDA for the first quarter was CHF 154.7 million with a 9.1% margin.

Then below EBITDA, depreciation was fully in line with last year and amortization was lower compared to last year in absolute terms and also when measured as a percentage of turnover. The improvement in the amortization is due to a positive translational effect from the British pound as well as the full amortization of certain assets and extension of contracts.

For the full-year, we believe that the first quarter amortization is a good indicator generally to extrapolate. Other operational results for the quarter were minus CHF 6.7 million.

There the majority of costs were related to new projects and local restructuring costs. Financial results improved by CHF 8.8 million, mainly due to the earlier repayment of the U.S.

dollar bond and the related cost savings, so this repayment we did in December last year. Income tax was positive CHF 10.2 million for the quarter.

As usual, I would like to highlight here that the tax rate does vary significantly across the year. So the first quarter is typically not the strong indicator for the portfolio tax rate.

Non-controlling interest increased by CHF 1.3 million, mainly due to the good growth in locations where we do have minority partners. Overall, net earnings to equity holders improved by CHF 24.8 million.

Cash earnings which have backed basically the acquisition related amortization were CHF 15.4 million for the quarter. Then if we move to Page #19, we have as usual the cash EPS.

Cash EPS was CHF 0.29 in the first quarter, because of the seasonality of our business, the overall contribution is small in first quarter. But as you see the development is trending in the right direction, so the improvement year-on-year was CHF 0.34.

Then on Page 20, we have the cash flow statement. And similar as for the P&L, also the cash flow statement is strongly seasonal.

And the first quarter is the lowest quarter in terms of cash flow. Typically, we would expect a neutral to a negative cash generation for the quarter and this was no different in the first quarter 2017.

Having said that, there were some additional elements that reinforced the trend. So let’s start with the net working capital, overall we invested CHF 137 million into net working capital.

Different elements were on one hand the build-up of inventory ahead of Easter. That has always a negative impact on the cash flows in the first quarter.

Now, this year this effect was even more pronounced, because Easter fell effectively then in the second quarter of the year. Furthermore, we also have a higher order volume in locations where we have accelerated growth.

There is a certain time-lag, as the increased sales are not reflected yet in the financial, but the buildup of net working capital is up front. Having said that, as we will see later, the core net working capital as a percentage of turnover still improved year-on-year, because of the strong performance of the overall group.

In addition, we have some other elements with seasonal deviations such as sales taxes, concession fees as well as advertising income. We expect that these components should normalize along the year, so really that Q1 should be the low point.

Then moving to CapEx, this was in line with - as an absolute demand for the full-year expectation with CHF 77 million for the quarter, but if it’s measured as a percentage over turnover, it was above our target corridor. Again, same reason as seasonality.

Below free cash flow, the cash out for interest reduced mainly due to the bond repayment as mentioned before. As some of you may remember, in the last presentation we mentioned an additional cash out of more than CHF 100 million in the first and second quarter related to a number of projects.

The first quarter cash flow reflects about CHF 33 million of these cash outs and they are included in CapEx. The remaining amount, i.e., approximately CHF 75 million is expected to be booked in the second quarter of this year.

And it will be reflected in working capital changes, as we talk about prepaid concession fees and cash deposits. This means the remaining amount will not to be included in CapEx, but in working capital.

So this means we will have an additional cash outflow in 2017, but CHF 75 million will be recovered over time. Then if we move to Page 21, there we have our usual KPI cash flows - cash flow KPIs - sorry.

As mentioned before, CapEx as a percentage of turnover was 4.5% because of the low seasonality, but we expect this to revert to our target range over the next quarters. So our target CapEx remains unchanged at 3% to 3.5% of turnover.

Core net working capital improved by 40 basis points to 5.6% year-on-year, despite the increase in core net working capital. Hence, the improvement that we mentioned in earlier call is also confirmed in this quarter.

Then, if we move to the balance sheet on Page 22, the situation is very stable and there are no major shifts since yearend. To conclude on Page 23, net debt increased in the first quarter to CHF 3.83 billion as explained by the cash flow covenants as mentioned were 3.79 for the first quarter against maximum threshold of 4.5 times.

As to the financing mix and the duration, there weren’t any material changes, so I think there everything remains unchanged. So this concludes the financial part of the presentation.

And I’d like to hand back to Julián.

Thank you, Andreas. Let’s move to Page 25.

As a conclusion, I think the first conclusion remains the same. It’s - we have returned to the growth that the company used to deliver in organic positions.

To continue with this organic growth in 2017 we required, and it’s obviously going to happen, the implementation of the digitalization of the business. The acceleration of commercial initiatives, that I already mentioned it in this current and previous calls.

The refurbishment and continue with the refurbishment of the operations, and the increase of the retail space, the 23,000 square meters that so far we have increased. The total number of square meters we were operating by year-end 2016 was 420,000.

The implementation of the Business Operating Model is one of our main priorities. So far, the first wave includes 17 countries.

All the countries, the 64 countries of the company will be implemented from the business operating model point of view by December 2018. The new generation of stores, in my view is one probably the most relevant initiative from the commercial point of view we have implemented, will be open in Heathrow Terminal 3, Zurich, Melbourne, Cancun, Madrid.

And all of these are in progress. The first one will be in Melbourne.

This is the comment I made when I was commenting on the performance in Melbourne. Melbourne 70% of the space from the commercial point of view was closed down, because we are in total renovation.

And finally, focus on cash generation and deleveraging is very well known, is going to be one of our main priorities for 2017 too. That’s all from our side and now all the comments or questions are welcome.

Thank you very much.

Yes, good afternoon, guys, and congratulations on the organic sales growth acceleration. It looks very impressive.

But, of course, we want more. And Julián, you seemed to be saying double-digit growth in all of the regions or most of the regions in the first few weeks of the year.

Of course, we know it is Easter related. But are you - adding all up, I guess, it’s growing at double-digit rates for the group as a whole, that’s my first question.

Second question, just on the margin, and obviously, as you saw the stock performance this morning, there are some market concerns, given the fact that the EBITDA margin only rose by 10 basis points when consensus is for a 100 basis points rise for the year. Are you confident that this will accelerate as we go through the year?

And just maybe as an add-on there, you mentioned concession fees. You seemed to be saying that should be 10 basis points higher this year compared to last year, versus the almost 1 percentage point we saw in the first quarter.

And just a last housekeeping question, I wonder if you can just give me the figure you used in absolute amounts to get to the cash EPS level linearization and the amortization after tax. Thank you.

Okay. Thank you, Jon.

For the Q1, obviously, the organic growth 7.2% is impacted by seasonality. One day less of sales in February is a lot in one quarter and the Easter period in the Q2.

What I said is obviously the consequence, what I said is confirmed. It’s the organic growth during the first three weeks of April 2017 has been double-digit growth.

Yes, but obviously it’s also supported by the seasonality. Regarding the margin EBITDA, in my view what we are disclosing in Q1 is tremendously impacted by significant fixed cost structure.

And in several operations like for example the U.S. or UK, we have performed well, but not at the level to really [gain at eight] [ph] the EBITDA margin that probably the market was expecting.

I remember, or you mentioned it in the past also, really you were expecting around 9.5%. I am not concerned about that, because when the sales will and the EBITDA accelerate in Q2 - especially Q2 and Q3, the EBITDA will grow and will reach the level expected.

In terms of concession fees, I don’t remember to mention anything in specific. But this time on top of the seasonality, you have a mix effect, higher sales in the UK and other countries with high concession fees.

The second one is the increase of the market in Spain and in Finland. That is not a secret that we share, that market in Spain and in other countries, especially in Finland, due to the contract signed at the time these operations were in one case acquired and in the other case awarded in our tender process, the market is increasing year by year.

The main two increases in the Spanish market have been last year and the year before, but all years from now to the end of the contract, the market will increase. And what else, the cash EPS, Andreas?

Yes. So on the cash EPS, what we added back is CHF 76 million, which is the acquisition related amortization.

That’s the only adjustment that we made for cash earnings or cash EPS.

So there is no adjustment for linearization at all?

In the cash EPS, we don’t adjust for linearization or deferred taxes. This is just add-on information for people who want to do their own adjustment.

Thank you.

Thank you, Jon, for the questions.

Yes. Hi, everyone.

Three question, if I may. Coming back on the EBITDA margin, maybe if you can share some more light on the OpEx excluding the concession fees you need to pay.

If I calculate rightly, they increase by CHF 19 million. So in that there were no one-off costs or special things we need to consider.

So that’s really OpEx we should also further extrapolate through the year. Then on CapEx, there was this CHF 36 million CapEx in intangibles.

Can you be bit more specific what exactly that is? Is that prepaid concession fees or how should we think about that?

And then, finally on - I don’t know how much you can say about it, but on HNA, obviously, they announced that they acquired 16% or intend to acquire 16% of the company. Have you been approached by them, have you been in discussions with them, any thoughts on that move?

Okay. Thank you.

Regarding the expenses that are today with the new structure of the company, at the personnel expenses level and at the other operational expenses, fixed costs in several operations that are accrued in equal parts during the different quarters. I don’t think that excluding new operations that we have started, and then - and not relevant, I am not going to say that this is a change that impacted the cost structure of the company.

I think the issue here is personnel expenses and other operational expenses. I am talking about EBITDA, that are fixed and as a consequence impacting more in the lowest quarter of the year.

Regarding the CapEx, what we have accrued there is an extension for several years. I would say, I finished ten years of that contract.

And what we have paid is a fee for the extension, and for the [division we accrue that as] [ph] CapEx. And regarding HNA, I think we - it’s clear one thing, we have not been contacted yet.

We have not met with HNA, the representative yet. And what we know is the communication they forward to us.

On one side HNA, on the other side, [indiscernible] explaining that they have the intension to perform that transaction covering 16.69% [ph] of the total sales of the company that this transaction has [indiscernible] August 21, and is subject to customary conditions, including official approvals or regulatory approvals. That’s all from my side.

It sounds in principle very positive, because obviously there is a lot of interest of our company to expand the business in Asia. The opportunity with a company with this size, and with this specifically managing millions of Chinese customers from the tour operator side to the hotel side, it sounds positive.

But I cannot tell you anything else from the other side, because we have not discussed anything yet.

Okay. Thank you very much.

Yes, good afternoon, gentlemen. My first question refers actually also to concession fees and maybe to Andreas’ remark.

And I would like to understand what you actually meant. Concession fees year-over-year went up 0.9% or 90 basis points in the quarter.

And I understood, you’re saying that adjusted by the seasonality that would translate into 0.1% or in 10 basis points increase. Now, what I didn’t understand is whether when you say adjusted for seasonality, whether you refer to the Easter effect that we had in Q1 or whether you refer to the - let’s say, to the yearly seasonality, so if you could provide some clarification that will be great.

My second is really new concession growth. I would like to understand why you only had only, inverted commas, a zero there, given that the fact that you opened several thousand new square meters shops last year and would have expected at least a kind of a positive spillover effect into the first quarter this year?

And then maybe my third question is, in a slide you referred to Turkey, Russia and Brazil, where you said we’ll get back to this targeted EBITDA margins of 13% to 13.5%, once these three markets have normalized. So what I would like to know is, well, all we know from today how far away are we from, let’s say, normalized 2015 business levels is that, let’s say, 10% or 30% or 40%, just the kind of an order of magnitude would help me here.

Thank you.

Hi, Thomas. So let me start with the first question, and then Julián will answer the second and third one.

So on the concession fees, what I actually wanted to say, probably I was not very clear here, so of course you do have also a seasonality in the concession fees along the year. And I don’t want to suggest that the Q1 concession fee, if you want stable and fixed and that is - that’s the numbers to use.

But what I wanted to say here if you take the Q1 concession fees, and then compare it against the average sort of full-year concession fees of last year, the increase is only 10 basis points. So what I actually wanted to say is like, look, don’t take me wrong.

Don’t say, well, now concession fees every quarter is only going to increase 10 basis points, and that’s it, I think there is to be some volatility or seasonality for that matter. But what I wanted to say is like 90 basis points of last year of the first quarter last year for various reasons.

And I think Julián already commented it, is maybe not the only comparison point that we showed you. So that’s why, what I wanted to say, look, if you look at the full-year 2016, the truth is that the concession fees that we have in the first quarter look a lot more consistent than if you just look at it on year-by-year basis.

That’s all I wanted to say.

Okay. Thanks.

Okay. From my side, I think the new concessions, the 5,600 square meters of commercial space that were opened during the last part of February, beginning of March, and you know that obviously I cannot be specific, because I don’t know all the operations open.

But they were opened mainly in March, contributing plus 0.5% of sales. And the termination of the contract in Dubai, because it was not a profitable contract we terminated.

And the temporarily closing in March of Sri Lanka, I hope that is temporary, because obviously we are participating in a tender for the extension, contributing in negative 0.5% for the reason the final calculation is zero. Regarding Turkey, Russia and Brazil, obviously I cannot say that is going to happen, because what we have seen so far is that two quarters with significant improvement in Turkey, Russia and Brazil, the total business that we have lost in this operations are due - sorry, in this operation - due to Turkey, Russia [pasaneous and Brazilian pasaneous] [ph] was around 5%, 6% of the total sales.

I think last year, with sales this year very close to 5%. And I think this 5% is what we need to recover.

The reality is there. I cannot say something different.

Most of these operations are growing high double-digit growth. Around 2017, beginning of 2018, I guess the business will be again in the company.

But this is [put already] [ph].

Okay. Now, coming back to this new concession, what I actually meant - well, I didn’t expect the 5,600 that you opened in Q1 would already contribute massively to sales in Q1.

But I am referring to all the thousands of square meters that you opened in 2016. When you analyze that, that should be a spillover.

And I would have expected in new concession growth to have a positive number from what you opened last year, not this year, last year.

Yes, yes, basically - sorry, I don’t have the calculation here with me now. But let me check it and I will answer you.

I cannot answer the question, because I don’t have the information here. But it should be positive.

And I think will be positive, but I cannot answer it. I don’t know.

Maybe a last one to Andreas, did I understand you correctly, that we can take the amortization charge in Q1 times four, that would yield - would result in CHF 360 million, which would be again kind of CHF 20 million lower that you guided back in March, is that correct?

Correct. So I think, put it that way, I think the concession fee as we see now, probably it’s closer to the CHF 360 million than it was to the CHF 380 million.

That is correct.

Not concession fee, amortization…

Sorry, the amortization, I apologize. Sorry, my mistake.

All clear. Thank you.

Good afternoon, gentlemen. I would have a question on the profitability on the EBITDA development.

In the different regions, you just have negative in Asia with a margin of 4%, if you can maybe put some color in that. And with regards to the gross margin improvement, the 100 bps, you were mentioning the synergies, which are quite significant, but if you can put some color as well on the mix of the different categories, you’re mentioning, I think, luxury was up 16%.

What was the contribution on this mix? Thanks.

Okay. Regarding profitability in Asia, obviously, this is also impacted by the intercompany charges.

But there is a decrease in the profitability, mainly due to the Sri Lanka operation. In Sri Lanka for several weeks was not part of the consolidation of the information.

This is the main reason, also the intercompany charges. Regarding the different families of product mix, the fastest in terms of growth has been luxury product with around, let me check here, I go it here with around 16% increase.

Then we have perfume and cosmetics, and wine and spirit with plus 8%, and food and confectionary with 5%. All the different operations performed quite well.

And this is obviously in constant currency. That’s all, that’s the question.

Yes. And is there an impact on the margin, is it like a positive mix impact?

No, the mix, no. The margin was impacted by the synergies generated by the acquisition of World Duty Free and originally Nuance.

Very clear. Thanks.

Hi, thank you for taking my question. When you mentioned the 1Q was going to be the low point in terms of working capital, you are not including the CHF 75 million remaining CHF 100 million cash outflow to projects, correct?

Yes. That is correct.

So the free cash flow profile for 2Q should be significantly lower than it was last year, if we assume that this CHF 75 million is in top of whatever it was last year, correct?

Correct. But on the other hand if you have - you sure should have a certain, if you want, relative improvement, isn’t that, because the normal working capital that we have now has a negative impact in Q1, partially should revert.

Not everything, but partially. So I think that’s the other element that should be on the positive note for the working capital, but you’re right in the general way to think about working capital.

That is correct.

All right, thank you.

Yes, thanks. Thanks for taking another question.

Andreas, maybe you can answer or Julian. What is your best guessing for the rise in concession fees issue?

Obviously, with 90 basis points in the Q1, you talked about 10 basis, for the year as a whole do you have any best guess what you think will happen to concession fees at all?

Jon, it’s very complex, because it all depends on obviously the mix of the different operations. What you have seen in the first quarter is that operations with the high, let’s say, concession fees were more important in terms of growth and in terms of participating in the total contribution to the sales.

I cannot guess, and obviously, we have the budget, but we have not disclosed the budget in the past. And I don’t like the idea to disclose our budget in this presentation.

In principle, I think what you have seen during the first quarter in my view, in 2017 will be very similar to the total if the important operations are performed like today. If the important operations, I mean, the UK and the U.S., where obviously we have different higher concession fees in duty-free are performed and participated less in the total, will be lower.

But I think it will be depending on the mix. In terms of your model, I suggest you put more or less the same thing than the first quarter.

Okay. Thanks.

Thanks very much.

Okay. Thank you very much to all the participants in the call.

We always remain available if there is something else. And let’s see how the second quarter continues.

Thank you very much.