Okay. Good afternoon, everybody.

Here, we are in Zurich. Welcome to our half year results 2020 presentation.

I am relieved that we can hold a fiscal meeting. We are very few people here.

But still obviously, it's important that we are face-to-face. And we also welcome the participants via conference call.

There is a long list and with the presentation today is with me also Yves Gerster, CFO as always. Let's move to the Slide 2 of the presentation.

Here if I glanced at our agenda for today meeting and as always, we are going to dedicate a significant time I hope at the end for your questions. If we move to Slide number 4, I think what we have here is the highlights of what happened during the first six months.

In the center is organic growth minus 60.6% tells negatively impacted by obviously the pandemic, but we differ in evolution. First, we started with a significant increase of sales in January.

February gradually is slowing down especially for the impact in Asia and in international destinations is minus 7%. Finally in October, during the first quarter with the same turnout in February, it's already in February and March with the same trend down in the first two months.

And the second part with minus 93%, minus 94% compared with previous year, and we close down the first three months in the first quarter with a minus 21%. During April, May and June what we have seen is, the slowdown in May, but we -- obviously an increase compared with the previous months, we were generating around 4% or 5% of the sales of last year.

In May around 9% of the sales of the previous year and in June where we will -- we had obviously around 9% of the sales of previous year. In July, and we are going to see that in a minute, we have reached very close to 20% of our sales of preview year.

I think there is, three first days of August, we have been very close to 40% of the previous year. The message is obviously we are still far away, but what we have seen is positive trend strength down obviously the moment that the situation of life has to close down most of results.

On the left side is the 1 billion, the 1 billion savings that we have commented in the past, that are obviously a significant challenge. But at the same time, it's also an opportunity for explaining that this company we have done in the past is a company with a very good, flexible, fixed viable process structure.

The 1 billion that is committed on this slide on the left is fixed costs and this is what we are expecting for the year full year 2020. So far in the P&L, what you are going to see is 470 million impact in fixed cost plus 137 million that are minimum annual guarantees waivers that are due to the pending documentation have not been reflected, but it will be reflected during the next month.

Specifically talking about 200 million in personal expenses savings, around 150 million related to operational expenses and around 161.2 million regarding minimum annual guarantees reliefs of cost. Continuing with the highlight, I think it's also very relevant that this company has been able during the last three months to really enhance and reinforce the financial situation with such significant number of initiatives that if we'll present and will introduce that as a consequence of we reach by June 30th very close to 1.6 billion liquidity.

On the right side of organic growth, one of the only numbers that I would like to remember more because the most is the closer to the proxy of the formula EBITDA before IFRS 16 minus 130.5 million. This is a consequence of all these initiatives of savings that have been implemented and also the consequence of obviously the cash protection that we have that.

On the right side, the equity free cash flow this time is 750 million negative is a consequence of what we are obviously discussing today. But it's also relevant to mention that the most important part of these is due to three factors.

One is payments coming from the previous year, concession fees, another type of payments or whatever you needed in 2019. There were also expenses that were related with the halt of processes that we have started.

And finally, obviously, there is a significant impact also here about the slowdown of the sales and as a consequence. As a consequence of the purchases that we have run, due to the foreseeable at that time, high season, we acquired a significant level of inventory.

Moving to page number, it's better explained in number six. Turnover in heavier amount 1.6 billion is 2.6 billion less than previous year 2019.

The closers as I mentioned started in March 2020 and have been implemented in most of the locations, where we are operating in April and May. Now with travel restrictions being listed where I have commented on is obviously, my view.

Later, at the end of the tunnel is, we have recovered from minus 94.1% of sales compared with previous year remains to July minus 82.3%. During this early phase of reopening, we are experiencing a higher spin for passenger compared with 2019.

This is another in my view brilliant information. What we have seen due to the passenger profile is that the passengers buying something in ourselves are increasing perhaps tremendously compared with previous year.

These indications are encouraging, but it would be too early to extract any conclusions. In our view, here what we need to consider is that the persistence of the passenger's recordings is key for confirming these trends.

If we move to a Slide number 7 turnover and organic growth by region. In this slide represented obviously, the total sales per division and also the performance in organic growth compared with previous year.

The organic growth by region comparing of segments there is performing has been Central and South America with organic growth coming at the minus 55.6%. Why?

Because this division was impacted the latest in terms of the process, because obviously the crisis started in middle of February, beginning of February in Asia, and then gradually moving to the West. And the last one impacted was division number four.

The division was, at that time, operating international flights with total normality. Europe and Africa so the highest decrease with total sales 558.9 million Swiss Franc in the first six months and organic growth minus 66.1.

Performance was negative across most locations due to the restrictions in force from March onward. From middle of June 2020 from June 15, travel restrictions were lifted or eased an intra-European travel especially in South and Central Europe as well in the UK, started to resume.

Organic growth in our North America operation was minus 57.9 in the seconds less impacted in the field; without this lockdown in both segments, but especially in duty free which is exposed to international flight schedule. The relatively stronger performance compared with other segments is based on the prevalence of domestic product, which accounts for around 85% of the U.S.

flight movements, but we are also considering here that North America got impacted later than Europe and Asia, and the domestic started to resume already. Organic growth reached 30% in China and South Korea, this is division number two.

They impacted especially during Q1 2020 by resuming domestic and bilateral travel in Q2. Other parts of Asia Pacific and especially Middle East region were impacted mainly in the second quarter and are still continuing to be impacted with a low level of open source.

If we move to Slide number 8, net sales by region and sector are consequence of what we just discussed. Europe was impacted and the restrictions started early compared with North and Central and South America.

Therefore, district by region is slightly different compared to previous year. Europe and Africa amounts for 36% of turnovers down from 44 in the full year 2019, North America with 25% and Central and South America was 21%.

Dufry distribution center is brilliant and increasing share from 1% last year to 3% this year. This is one of the reasons that we are going to comment on later because this impact obviously the margin, gross profit margin mix.

The wholesale business represented this year 3% and last year 1%. If we move now to Slide number 9, net sales and performance by per category, look at the net sales per category the product mix only system is likely.

For example, the biggest category in regard the share or percentage of net sales passing on cosmetics was a slightly asked by 200 basis points compared to full year 2019. However, the decline year-on-year in net sales what is likely is stronger compared to foods and confectionery or electronic.

As most of our sales will close during Q2, it is too early to make out a trend regarding the product categories, but in the past what we have seen is obviously more resilient performance in experience tobacco, perfume and cosmetics, and food and confectionery, and more impacted categories, basically talking about the luxury product. If we move to a Slide number 10, net sales by channel, Dufry by channel provides an idea about obviously that the most important impact happen in the airport and retail channel were down and reaching around 63.6% in net sales compared with half year 2019.

All the other channels were very close to 50%, 51% in most of the cases. If we move to Slide 11, we’re continuing with obviously the same rationale that we have used in the past for announcing how the Company is evolving in terms of square meters of commercial space.

We have respect, in the respect, opened 2,150 square meters of commercial space and renovated 6,350. Most of them, probably all of them were opened or renovated before the crisis -- the stronger part of the crisis is started.

The total number of square meter that we are operating today is 470,000. We have also under negotiation, and this is also very one to mention, around 32,000 square meters of commercial space that will be negotiated and/or, let say, allocated to the portfolio during the next month.

If we move to Slide number 12, and what we are going to see from now on is the financials, and I would like to hand over to Yves for continuing with the presentation.

Thank you, Julian, and welcome everybody here in Zurich, and those who have joined on the phone. On Slide 13, the P&L how's it typically show it, our half year statement 2020 clearly reflects the various cost reductions measures already mentioned by Julian earlier on with an adjusted operating profit of minus CHF464.6 million for the six months of 2020.

Let me guide you through the different lines of the P&L. Gross profits reached CHF920.5 million with a margin of 58%.

The gross profit margin was mainly affected by the turnover mix from the retail and wholesale business. In fact, our retail-related gross profit margin was only 60 basis points lower as compared to the full year 2019.

We achieved to maintain a resilience margin despite the sales decline. We expect a normalization of the business recovery i.e.

once the business recovers, the margin should go back to the initial number. Looking at the next line, lease expenses amounted to minus CHF75.7 million in half year 2020, compared to minus CHF633.8 million in the same period last year.

These expenses reflecting the variable component of concessions naturally decreased due to the lower sales level. In addition, we've successfully negotiated release on the minimum annual guarantees, MAG with airport authorities and landlords amounting to CHF161.8 million.

We expect to recognize additional MAG relief of CHF137 million for the periods of March through June 2020 retrospectively. These additional MAG release are not yet reflected in the financials for the half year 2020.

Personnel expenses decreased by more than 30%, general expenses by 40%, compared to the same period last year. We implemented an efficiency program, which included reducing costs on all levels, making use of government support schemes, voluntary salary reductions and also supporting by global executive committee and the Board, including ourselves Increase in depreciation and amortization is mainly related to the recognition of impairments on intangible assets due to the COVID-19 pandemic.

Impairments were CHF131.5 million on goodwill, CHF198.7 million on other intangible assets, and CHF10.4 million related to write-off used and property plant and equipment. Financial results including lease interest and foreign exchange differences amounted to minus CHF72.3 million.

Interest paid increased due to the refinancing of the senior notes in November, 2019. These effects were partially offset by changes in margins for amendments and new facilities as well as one-off expenses related to the different financing initiatives, if taking during the last month.

Income tax reduced, income tax reached CHF14.4 million, and the income was mainly driven by the loss situation of some of our operations. Minorities were at CHF101.4 million for the half year due to negative net profit achieved.

Considering CHF2.6 billion francs, less turnover for the period and adjusted operating profit of CHF464 million proves the flexibility of our cost structure and our cost at activity to the new environment. Moving to Slide 14 is the cash flow overview.

Cash flow metrics were also impacted by the lower level of sales. Cash flow before working capital change was CHF180.5 million, adjusted operating cash flow reached CHF103.5 million in the first six months.

As a reminder, adjusted operating cash flow is a very good proxy to the former EBITDA. However, it is typically slightly below the former EBITDA.

Keeping that in mind, one could argue that we have almost reached breakeven on the former EBITDA. I have briefly mentioned the MAG release already, which has been accrued on the respective period in the P&L.

In the cash flow statement, reliefs are excluded in the operating cash flow and shown as part of the lease payments. Our overall concession fees paid, which consists of the variable components shown as these expenses and fixed components declared as these payments were nearly 60% lower compared to last year.

Now please bear with me on the lower graph to guide you through the main impact on the equity free cash flow 2020 compared to the financial or the half year 2019. We already addressed adjusted operating cash flow.

In addition, change in working capital had a negative impact, which reached minus CHF473.9 million in half year 2020, compared to minus CHF17 million in 2019. Our trade payables decreased in the second quarter as we stopped purchasing new merchandise.

The decrease was also related to the 2019 comparative space, when we have an increase of CHF97 million in trade payables. Additionally, other accounts payable especially accrued concession fees payable decreased as well.

Income tax paid was slightly higher as payments in the half year were related to 2019. For CapEx, we have reduced it by more than 50%.

Net interest paid was lower as the refinancing of our senior notes in November 2019 had a positive impact. Payments to non-controlling entities decreased based on the decrease in net profits in the first half of the year.

All the financing items contain one of net expenses related to the different financing measures. We have taken in Q2 2020.

Summarizing we report equity free cash flow of minus CHF749.1 billion for the first half of 2020. Moving on to Slide number 15, this slide provides some additional details on our core networking capital and capital movements.

Core networking capital consisting of inventories, trade receivables and trade payables stood at CHF581 million at surface June, 2020. Not surprisingly, core networking capital as a percentage of sales increase due to the lower sales level, main driver was the decrease in trade payables.

CapEx as a percentage over sales also increased slightly, at the beginning of the year we were still investing in refurbishment. We spent CHF60 million in CapEx in the first half of 2020, mostly related to refurbishment.

For the second half, we expect a lower expense compared to the first half of the year, for both net working capital and CapEx to sales ratios, we expect the normalization in line with the recovery. Slide 16 gives you an overview on the expense reductions and cash savings in the first half year 2020.

We have included the bridge displaying changes in the first half of 2020 versus the first half of 2019 at P&L and also cash flow level. Why will have the lost of turnover of CHF2.6 billion change in equity free cash flow was CHF889.5 million in the first half year 2020, compared to the first half of 2019.

Just for the avoidance of misunderstanding, this considers all cost items not only fixed costs. Concession fees, personal expenses and general expenses were reduced by more than CHF1 billion compared to last year.

In percentage concession fees by 57.7%, personal expenses by 31.6% and channel expenses by 39.9%. Our cash flow levels, CapEx declined by CHF65 million to less than half of previous year's level, which were partially reversed due to the net working capital swing with a negative impact of CHF567.1 million in the semester.

Our potential to reduce expenses as well as the high flexibility and our cost structure supports us in the current crisis as you can see on the slide. We expect sustainable savings from 2021 onward pressure strengthening our cash flow, preservation and generation.

On the next slide, an overview on the, again on the financing actions we have taken earlier this year. In April, we announced a comprehensive set of initiatives to also strengthen our capital structure and liquidity position allowing us to sustain a prolonged period of operational disruptions and reinforce our competitive positioning in the longer term.

The different measures are outlined in the overview slide and includes. The new 12 months committed credit facility offering in the equivalent of CHF390 million, the CHF140 million COVID-related backed loans, the successful placement of new shares generating cross proceeds of CHF151 million, the placement of the convertible bonds of CHF350 million and the agreements with the banks to raise the covenants until and including tune next year, i.e.

the first testing will be in September 2021, where the leverage covenants will be tested against the five times thresholds. In addition, the Board of Directors recommended to shareholders to cancel the 2020 dividends of around CHF200 million to reduce short-term cash outflows in this unprecedented situation.

On the next Slide, an overview of our debt evolution and maturity profile. Net dept as of June 30 2020 amounted to around CHF3.7 billion.

There are two developments I would like to point out. First, compared to June 30 2019, the increase was only CHF368 million taking into consideration the seasonality of our business and the strong cash generation, which normally only starts in the second quarter and extends into Q3.

Secondly, the change in net debt in Q1 was an increase around CHF435 million. In Q2, net debt increased by only CHF120 million, positively obviously impacted by the financing initiatives executed in April, but also by a strong reduction in cash usage.

The right chart reflects the debt maturity profile including the newly received term loan of EUR367 million, maturing in 2021. Again, this facility has a possibility or the option to extend it twice by six months.

However, we have the possibility to extend the loan and the chart also includes scenarios COVID-19 related to government-backed loans with the total amount of CHF160 million, maturing in 2025 and another CHF27 million, maturing in 2022. And as of June 30th, 2020, we had around CHF703 million of undrawn bank facilities and close to CHF740 million in cash on the balance sheet.

As our cost reduction measures and crash preserving reopening program, we do not anticipate any liquidity problems during the crisis. We will pro-actively and all the other -- on the refinancing of '22 maturing debt and will informed the markets accordingly about any actions taken there.

On the next slide, I would like to provide an overview on the liquidity position as of June 30, 2020. The slides refers to pro forma liquidity as we have included two COVID-19 related government loans, which we have received approval only in July.

This amounts to around additional CHF30 million. The waterfall shows you the liquidity as of December, 2019, which stood at as CHF1.259 billion.

Cost consumption during the first quarter, as I've mentioned before was CHF435 million. For the second quarter, we were able to reduce cash consumption significantly also thanks to the cost reductions achieved already in the quarter.

Also in Q2, we received the inflow from the already mentioned financing measures detailed here, including these financing measures change in net debt amount to CHF122 million. In total, this results in an increase pro forma liquidity position of around CHF1.583 billion, as compared to year end 2019.

With this positive note, I hand back over to Julian.

Thank you, Yves. Let's continue with the outlook.

I think for the, the outlook I would like to start with same comments regarding what happened during two and half months. On the left side is very important, we at the time secured the liquidity position and also introduced initiatives for protecting the Company with a cost structure we had at that time.

The number one and regarding the liquidity secure is already confirmed by the performance in the second quarter. Cash flow was, obviously as Yves presented, and also the liquidity by June 30th, CHF1.6 billion.

The cost control and the cash management system implemented also explained how we have reduced the personnel expenses during the last two and a half months is around 200 million, already reflected in the P&L, and the Global Executive Committee and Board of Directors also contributing with a reduction of their salaries with a total amount of 30%. Supported programs by governments also contributed with significant part of it.

Agreement with landlords waived so far by depicted in the P&L 167 million with 137 million that will be accrued during the next month as soon as they are documented. Finally, the introduction of initiatives for improving the working capital and CapEx that we are going to comment during the last part of the presentation, but are also will be reflected in the slide.

The second part is to the change of the organization. We have introduced a new Global Executive Committee that will be on place is starting in September 1st with a lower number of participants.

We have integrated the headquarters and the division simplifying the management level and all the formal divisions are now operated directly from the headquarters, and we have created an opening plan that has been already commented on, but the reality is that by August 31st, this company will have 70% of the capacity of sales available. Finally, you have to confront the obviously the long-term strategy and to clearly explain that we have the intention to continue to be a global company that will generate synergies in global travel retail basis.

We will continue focusing in cash generation. Dufry will and as a consequence of the diversification, we have to be will as a stronger company.

And the geographical footprint that we will focus in the future will be the development of the Company in Asia. And regarding the continuing to digitalization, what we have today is a project that is a modern additional reality that has the opportunity to engage with the customers before they travel.

And this has been also one of the main drivers during the last three months of engaging with the customers. If we move to Page 22, you have clarification of the reorganization from the regional composition.

What we are going to operate is different clusters that will be allocated in the territorial clusters to. In North America, we'll continue with Canada and USA as a cluster.

Central and South America, we will have four clusters, Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Peru, Hawaii, Caribbean et cetera. And the same in Europe and Asia-Pacific, there are today nine classes including the U.S.

This is the way that we are going to report from now on. Slide number 23.

Obviously, we are starting in the reopening phase. I think it would be interesting to comment on what is in the market today available about the future.

The different in industry associations for a transport, civilization of authority Cyprus and other institutions are assuming, dropping passengers between 50% and 60% in 2017, compared with 2019. Only IATA, International Air Transport Association is an outlook for 2021.

The overview shows the limited visibility of all parties involved. More independent data providers are a forecast assuming a sharp decline in 2020, however a fast recovery and subsequent years with passenger volumes back to 2019 in 2022, and in services, another independent pressure house provides different scenario for 2020 ranging from minus 44% to minus 73% drop as expected recovery in 2022 beginning 2023.

The last two assumptions are closely in line with do for your assumption to see in the recovery of the plans that we are going to comment on in a minute and we are expecting the recovery during the last part of 2022 and beginning 2023. The start of the reopening have assets obviously to both on that self by self and location by location, and we are going to gradually open all the shelves as far as we concerned three things.

Number of passengers, minimum required rent that we pay adapted to the reality and also the personal expenses in each of the locations. If we move to the Page 24, what we are here is repeating something that we have already commented during all the results is how the different scenarios are performing in the different in lines of the P&L and the cash flow.

The scenarios considering minus 40%, minus 50% and minus 70% of turnover, compared with 2019. These are scenarios include the following cost reduction and saving levels are basis into Q1 training report.

In a decline of a business by 40%, 70%, the concession fee related expenses would amount between 33% and 39%. We are talking here about concession fees considered pre IFRS 16.

Personal expenses to be reduced by 20% to 35%, compared with the previous year, including restructuring related costs. This year, we have accrued so far 62 million as restructuring related costs.

Other expenses to be reduced by 30% to 43% compared to the previous year. And we are assuming our CapEx spend of around CHF100 million in all the three scenarios, but it could be few reduced depending the needs of the Company.

During the reopening in the second half of 2020 and depending on the recovery trajectory, we expect an average monthly cash flow of around plus CHF50 million and minus 40% of scenario and around plus CHF10 million in a minute 55% of scenario and cash consumption of around CHF60 million and minus 70% of scenario. We would reach cash flow breakeven in a second half, during the second half of 2020 at around minus 60% of turnover completed with 2019, that means our net debt position from June 30, 2020 will be the same on December 31 2020, or better if we could achieve 40% of last year sales 2019 during the second half, during this time in 2020.

Again, this tells you as of stability of our fixed cost based and the strong cash generation capability of Dufry. Just a few comments regarding the sales evolutions during the last week, and since the mid of the June, travel restrictions have been increasingly lifted and domestic and international travel is started to assume especially in Asia, Europe and the U.S.

We started to reopen our retail operations gradually based on single locations for the CVT scenarios and in cross collaboration with all the airport authorities and landlords. The transfer value and weekly sales evolution is starting in last week before borders in Europe have been started to open June 15th given later we are still on low level with minus 79% year-on-year.

However, the gradual uptake in receivable at July 21st where we are reporting minus 82.3% organic growth at this time, compare with down minus was 91.1% in June and minus 94% in May. International, for the different areas performing North America was only minus 66% sales compared to July, 2019, the best performing region due to the highest positive domestic travelers.

Europe and Africa was negative 84%, Asia Pacific and Middle East minus 87.6%. If we moved to Slide 26 and this is showing the number of shops open so far by the end of July, more than 1,000 or our 2,400 shops open with a capacity of sales of around 60%.

We are expecting that by August 31st, the total number of shops reopen will be around 1,250 with 70% sales capacity. If we move to a Slide that I considered interest interesting from the point of view of understanding the passenger behavior and the passengers motivations so far.

This slide is a very simple one, showing the three most important drivers that all customers declare pre-pandemic, that time their intentions to buy; third one, price and promotions, the second one assortment and the next one, behavior of the stuff and attention of the stuff. This is biannually research that we do in with 25,000 customers in the 50 most important locations globally.

And the second one is in the Slide number 28 that is based in our consumers and this one is more -- compared with the other one, but we have 2.9% margin narrow and was down during June, 2020 at the time of the pandemic. 58% of Dufry customers interviewed in June have you schedule a flight in the second half of 2020 and 77% of these confirm that they have the intention to fly, 30% of these customers and 10% for both, 10% of the customers confirm that they are even willing to buy more products than before.

In addition, I would like to comment on one thing that I mentioned at the beginning is so far they spend in Dufry shops is 20% above last year. Finally, the conclusion, and I don't want to repeat too many things that we have already comment.

The situation has been really difficult, but we have been able to manage and to adapt the cost structure of the Company to the reality, with an impact in the P&L first half of CHF417 million of savings, and that, we have reached CHF1.6 billion liquidity by June 30th. Then we have also aligned the organization to the situation and we have adapt the organization to the situation creating different cash burn depending on the drop of sales minus 40% with plus 60% cash flow, monthly cash flow, minus 55% with plus 10 million monthly cash flow and minus 70% a scenario with minus 60 million sales in, 60 million cash burn per month.

The realization initiatives are created in my view, a stronger company and more efficient company for the future. The gradual recovery of the passengers is also very relevant, still far away from 2019, but jumping from one mass to the other.

Still the visibility is very low and the information that we have collect from the passengers that have been customers in the past confirms that 80% of all past customers will behave exactly the same or without any significant change than in the past. That's all from my side.

Thank you for participating in the call. And I think the interesting thing now is the Q&A.

All the Q&As are obviously welcome.

Thanks, guys. So just two questions from my side.

First one would be on the implied cash burn for the second half here. So it looks like the market is a bit disappointed about the implied second half cash burn free working capital.

But in my view, it seems like you have fills in quite a bit of from MAG relief that has or basically filled in a very cautiously on the MAG there for the second half year. So is that correct, is there some margin of safety built into that number that could allow you to actually outperform the fingers you have provided to the market?

And the second one would be on the government-backed loans, any room there to access additional line of credits?

Let me start with the second one first, on the government backed loans. Yes, there are two or three additional ones, we are currently looking at.

They are in one is in Africa, one is in the Mediterranean area and one is in the UK, and they amount to more or less CHF50 million, CHF60 million equivalent.

Okay. In total or each?

No, no. In total, if I take maybe a little bit more.

And then in respect to the cash flow, so you look, yes, there is a certain level of potency in respect to concessions. So we have taken into account some relief of minimal annual guarantee, but obviously not full potential in that.

So just on the cash burn numbers. Would you walk us through what the monthly cash burn evolution looked like in Q2 and also if you can comment on what the cash flow burn numbers looking like it's going to be in July?

That'd be helpful. And then just on your monthly cash flow guidance that you provided today's for the second half.

Could you clarify exactly what you're assuming with respect to working capital movements within that guidance? I'll leave it at that for a moment.

Hi, David. Thank you very much for the questions.

So on the cash consumption, what we have seen in Q2 is as we've announced previously for April around 200 million of cash consumption. As we have mentioned before, that was mainly related to invoices, which related to the first quarter or even 2019.

In May, the cash consumption has drastically reduced to around 50 million, we originally guided for give or take 100, so that was already below that. In June, it was around 25 million, and in July, I have just received information this morning, it is slightly below 20 million.

And then for the second question you've asked, we assume a slightly positive change in the core networking capital for the second half of the year. So, the cash consumption guidance we have given assumes a slightly positive change there.

So just to follow up on those two things, I guess number one on July, the slightly below 20 million in cash burn and when you line up that organic growth of minus 82 within your monthly framework of guidance, obviously, that minus 20 has you much less than the cash flow number implied by that. So, we'd be interested to hear why that's the case?

And then secondly, then just to confirm on the working capital, your guidance isn't assuming the full reversal of that 473 working capital is just a reversal of the co-working capital which I think we're going to help flow up 130 in the first half, is that correct?

Well, look to the first one -- sorry I'm not sure if I understood both questions, but let me try to answer the first one because I think if I understood it. So there, yes, indeed, the cash consumption is lower than what we get now as guidance.

But having said that, look, that's why we give the guidance for the second half like we do. We say, it's an average monthly cash burn, there might be certain swings between the months and therefore, you cannot take a single month and isolate that and take it as a kind of a proxy for the overall evolution.

So, July was relatively low. It was as low as expected, but you cannot take that as a proxy for minus 80% drop in sales obviously.

I'm not if this answers the question if not…

That's perfect. I guess the second question I'll maybe simplify, are you assuming a reverse that's just the co-corking capital in the second half?

So that's mentioned before only reflects the co-networking capital, yes, exactly.

The first one will be pleased to follow up on the case scenarios you're providing. And I tried to make the math here a little bit and I come to believe different outcome and I'm sure I'm wrong.

And just want to ask you, I mean, in the confession fees and first expenses, this ratios you're providing is there and quite a lot of noncash expense into this year? And the second question would be please on the cross profit and the negotiation with suppliers.

I mean, is this done now for the new trends and for year end, or do you have visibility already into '21 or you have to renegotiate the inventory suppliers? And the same also with the landlords regarding MAG release, it is now for the next six months and then you would have to sit together again for '21 just to get a better feeling, what could be the cash flow approach running into 20% revenue scenarios?

Thank you, Joern, for the question. So let me quickly start with cash scenarios.

So, they are more than happy to have a separate call and look at the assumptions in that respect. I think what we have done is, so what we need to be super careful is the different view between P&L and cash flow.

So especially, when it comes to concession fees, but also when it comes to personal expenses, you need to make sure that, when you calculate the cash consumption that you consider seasonality you have in our business, especially in relation to concession fees. Then for the gross profit there, do you want to comment on it?

Regarding the gross margin, I think, what is happening now is we have agreed with the suppliers, especially during the last part of 2020. And as far the situation remains, at lease till today, formula that we combined gross profit margin and networking capital at the same time.

And I think this is, for us, very supportive and this allows us to adapt the business to the reality of the times. Regarding the concession fees, there are, as you know, there are more than one-house in different contracts.

And if the question is regarding, have you already agreed some of these reliefs of March 2021? The answer is, yes.

Okay. So you assume also on the MAG release that this release track and also into 21.

So you really operate on the lower cost base here also for '21. That's what the revenue scenario would be?

It is obviously difficult to say with all the detail, but the answer is this in total.

Julian, so just one question for me so I could start on trading and then cash flow. So on trading, as you said, if my memory is correct that it was down the exit rate for July was 79% I'm sorry, it looks like things are improving around 200 basis points sequentially a week.

So, when I know you guys have visibility obviously on flight plan in the coming weeks. So, should we more less expect a decline of around what 75% on average for the month of August and to what extent the lockdown in Spain, which is a big country for you will be an issue?

So, that's the first question on trading. And then just sorry to come back on cash flow.

Regarding personal expense, you mentioned in the release that, you had CHF34 million of government supporting in H1. I was just curious, is that the money received by Dufry and just the money received by Dufry, and to what extent government has supported directly and employees in some countries where these you guys are paid by the government and not by you?

So, just a sense of the magnitude of that, and where I'm trying to get at obviously that is there a risk that some of these guys would come back to your payroll in September, October or November when these schemes end? And so one last one on negotiation with landlord, again you’ve made, since you've made good progress waving some of the MAG closes, but do you have better fortune kind of closes or earned outflows for 2021 and '22 with the airports, which could cap your upside next year in terms of cash flow potentially?

I think, I understood the question, but if not, repeated, please. Regarding the Spain, I think the situation has been slightly changes in what sense we had ex growth to Spain of passengers and now is slowing down, but no negative.

But most of these passengers that were scheduled to Spain now are deviated to other countries, and we have seen a significant impact, positive impact in Turkey and Greece, mainly. The 21% of sales of the last week that I have presented until July 26th is improving significantly now, but still there are very few days.

I cannot say that this is going to we maintain. But today, during the first three days of August, we have reached around 40% of the sales of last year.

Regarding the concession fees and I think I mentioned that before. We have obviously many different contrasts, more than 1,000 contracts, only part of these contracts are subject to minimum annual guarantees and some of these minimum and annual guarantees are also subject to minimum per passenger.

When you have a minimum per passenger, the situation is adapted automatically. We have also contracts that have been renegotiated in terms of the total amount paid or will be paid during 2020.

And there are also contracts that are in the process to be documented properly, that will consider also the evolution of the passengers in 2021. How much is each?

I cannot comment now because it's not something that has been totally documented and properly documented, but we have a significant number of contracts that have been renegotiated not only for 2020 also for 2021.

Regarding personnel expenses, sorry.

On regard of personnel expenses, what we have projected for this year in full year savings that will be very close to 450 million, 460 million. This is a combination of initiatives that are starting with dismissals, temporarily work is on hold, and also support government programs during 2020.

My question is a bit more specific is. Can we have a rough idea of what percentage of your employees are not asking for any precise number, but just a rough idea of a number of your employees which have paid directly by the safe so we have a sense?

It's very difficult because as you know this is depending on the legislation initiatives jurisdictions. And there are consultancy projects or programs.

That should be, first of all, complete with the authorities in each of the countries. We cannot comment on things that obviously have not been totally closed down with the different legislations and jurisdictions.

But the number that I gave you, or I giving you the 450 million is a very reality target, especially thinking that so far, we have reflected in the P&L 200 million.

Three for me, please. Firstly, just in terms of gross margins, you're talking about a clean retail gross margin that's only down 60 bps.

So I'm curious what sort of mix impact are big enough to take your reported gross margin down over 200 bps? My understanding is that the wholesale business, for example, was now becoming very small for the group.

So what is diluting your margins that much beyond clean retail? And second question, on new concessions, minus 4.3% in Q2 net.

I appreciate a lot of terminal openings are just not happening at the moment. But equally, are you seeing any terminal closures?

How do you end up having CHF0.04 net exits? And lastly, more qualitatively, it looks like you've gathered quite a bit of intelligence from customers through your survey this summer.

So since you've gathered this intel, what main changes have you been doing to your commercial strategy, to your mix, assortments, promotions, et cetera, to stick to what they want even closer?

Regarding the gross profit margin, the 50 basic points in retail is basically promotions and obviously savings in terms of projecting savings to the customers. It is specifically that because it's still the mix has not changed dramatically as you have seen is very similar, like I say worries to the one that is compared to one year ago.

Regarding the closings,

Sorry, I think this is very clear what's happening in retail. My question was how do you get to 200 bps lower gross margin 200 outside of retail?

Yes, really sorry, I didn't understand the question. The difference between the 60 basis points and the 220 is a mix of wholesale, sales last year and this year as obviously is sub use retail sales drop significantly when retail sales maintain it, the level of previous year.

In terms of participation in the total mix of sales last year retail was, sorry, wholesale was 1% and this year is 3%, but specifically it's a mix issues, if you need any other explanation regarding the gross profit margin?

Well, yes, if it's so small, I just wondering how 1% becoming 3% is diluting the group's gross margin by close to 200 bps?

It's impact in this way.

Okay.

Regarding the closings, you can see that is not related with anything of this event the pandemia is something that we're already planning and kind of the operations are getting closer here, where most of them were already decided before the pandemic for the beginning of this year. Then it's customer's behavior.

Yes, if the question is, are you using the information that has been collected through this last research for preparing commercial plans? The answer is yes.

We have been during the last 30 days analyzing information. The different operations are prepaid in plan based on the information collected and will be probably in-place during the next 30 days.

But there are lots of things that we have learned, mainly obviously due to the type of progress that the people will buy and the significant development that other categories may have including food and beverage, including spirits and drinks.

And could you give us an example or 2 of what you're going to be tweaking? For example, one thing that seems to jump out is that dining is not a big priority for customers.

So are you going to be offering takeaway food, for example, or any other tweaks like that to capitalize on those trends?

Yes. For example when the customer has started to get in the shop, but we have done now is to prepare layouts in the floors to address the people and to go to the places where these products they come in on and prepare it.

And you can see this in Madrid Airport. You can see this in the Barcelona Airport and you can see this in London, Heathrow.

It’s addressing the traffic flow within the shop to the products that we believe that will be more successful.

Yes. Hello.

Good afternoon guys. A couple of questions for me.

Maybe just to back into that question about the savings, in a different way. Just based on what you know today, how much should we expect on a sort of continuous basis?

The personnel lines and that other line should be going, compared to 2019, and that's the first question. Just on the rent, it looks like everybody's moving away from the MAG and everybody is happy to do that.

But from what I heard from AENA and others, they are hoping to make up and be part of the upside. I was just wondering sort of structurally, if we do get back to where we were in terms of revenues in the next couple of years.

Would actually your concession fees be higher because these guys are saying, okay, we're getting rid of the MAG but we want maybe more rent as a proportion of revenue. That was the second question.

And then it just a question on the, you seem to be exiting some contracts, and you can see that in your financial statements, you think seem to be saying disposal of leases. And just in terms of the sort of book value of these leases, it looks about 15%.

Can you just say that, does that mean that the like-for-like component or the net you concession line, that's going to be down now by 15% because you've removed capacity overall? And then the last question, just Julian you were saying that, sales now in the last couple of days are running out 40% of last year.

But from what I see on the slide, you're saying that as of the end of the month, only 40% of stores are open representing about 60% of sales. So, you're saying that, those stores that are open are basically only running down to about 25%, 30% year-on-year currently in those first few days of August?

Thank you very much.

Thanks. Regarding the personnel expenses for 2021, I cannot answer the questions exactly, because obviously it depends on the different provenance that we are involved.

But I significant far over CHF450 million will be recurrence and this is depending, this is stage of the process of government support programs to that, obviously should be confirmed. Regarding the range and the max, WHAT used it for me?

I am telling you what I know and you're telling about AENA and AENA has recognized officially. And the Minister in this thing has recognized officially, that during the pandemia time, there is no minimum guarantee and during the rest of the time, depending on the number of facilities that will adopt the rent, I don't know what to say.

This is what they say. I don't have any comments regarding that.

What I know is what we are doing and I cannot disclose what we are doing, because he showed us, this is a private information. In general trends, but I can confirm is that, in most of the cases, the airports and landlords are ready willing to support the companies, and the question is what the benefits?

It is, do you think that, they insist to get minimum guarantees. They will get the minimum guarantees because this is the only way to go.

I think it's very likely and I can tell you that from the practical point of view, that in most of the cases, the minimum and what guarantees or rent, because we are talking also about viable rents will be adapted to the reality of the business during the next two years, where the situation we always spend, we normalize. And my feeling is optimistic on this regard.

I think what we have seen so far is reflected in the P&L, 160 1 million plus 177 million already agreed in the process to be documented. And there is a significant amount that I cannot comment, because it's not finally agreed.

And this will be announced obviously as soon as we have the documentation ready. Regarding, sorry, the last question was about?

Can you please Jon repeat the last question? I don't remember.

So you were saying that in the first couple of days of August, sales are running at 40% of last year's level. So that means down 60%, roughly.

But you're saying as well that only, your stores are open, representing about 60% of sales capacity. So you're basically saying those shops that are open are actually only running down by 30 or percent currently, to get to that running out 40% for the group as a whole compared to last year.

Ways of explaining. Yes, 60% capacity is what we have today.

But the 40% again, this is just example that I have seen. The reality comparing with the past it has to be basis or virtually in the number of soft open too.

You're right.

So you just returned to those shops that are open this 42 of sales of last year?

Within August, the last, the first three days of August, compared with the last week of July, there is no significant number of new sales open. Compare in the last week of July with the first week of August, first day of August, this is the change is multiply by two.

Okay. So basically those sales are open, you see average spend particular doubling or whatever it may be?

The simple passenger has to be confirmed, because obviously, I don't know in the first week of August. But the reality is that the passenger is significantly increasing compared with 2019.

Okay, good to know. All right.

And then the other question was really on this, you seem to be exiting some contracts, this is in your financial statements, and the book value of the exit seems to be around 15%. Should we assume that you never used sales capacity compared to 2019 by 15%, is that how I should read some of those small print in the financial statement?

Well, it is a calculation, but I don't know it's exactly the number. Now, this is a calculation assuming that the square meters that are close down, are having the same percentage of sales that the other ones and I don't think so.

It will be a lot lower because finally these shops are closed down because they are not performing as we expect.

Yes. But we should assume that that sort of net new concession line goes from, I think it was down 3% or 4% in the --

3%.

Yes, and then that will go down to 3 minus 10 in the second half of the year, something like that.

Well, like I don't know, I don't know the calculation because depends on the evolution of sales of the other concessions, but if the question is the 3% that is net of closes and openness in the disclosure is going to impact, 10% of the total sales during the year, the answer is, I am sure that is not, because obviously the service that we have close down are not also with this productivity.

Thank you for the very detailed and very helpful presentation. So I have three questions.

The first one would be in relation to your visibility on your May cash outflow. So we already talked about the cash outflow that you guided to be around CHF100 million in May.

So what has now changed so drastically that you had only CHF50 million in May and also saw significantly lower outflow in June. Can you give us a bit more granularity there, please?

And then another question is just in relation to the MAG discussions and negotiations. I know you cannot give some precise details there.

And so far, you mentioned that the majority of the related contracts or the land losses, happy to discuss those contracts. But can you be a bit more precise, please, about this majority?

Is it really around 70% or only 50% of those landlords who are really willing to discuss with you? It would be helpful.

And then just another question on your FX gains and losses. So there, I just saw that in the P&L, you had an FX gain of CHF43 million.

But in the cash flow statement, it was cash outflow. So can you elaborate on that as well?

It was CHF43 million for your notice?

Okay, so if I start quickly with the first one. In May, the cash consumption of 50 million versus initially indicated 100 million.

The reason for the lower amount is actually on behalf of what you've indicated initially is the measures we have taken, the various number of measures fees on the personal expenses, concession fees, et cetera, which going to announced earlier, which already started to kick in April, but then specifically also in May, June and July, and that led to the lower cash consumption in that regard. Then to the third question, the FX gains on the P&L and also the cash flow statements.

I would need to double check once more, but I believe it's actually positive effects on both the P&L and the cash flow statement. The reason for the positive effects here is basically an exposure which we have hedged over long plain vanilla call options, which, as you know, can only reach a positive amount or a positive evaluation and that resulted in that gain.

But if I'm not mistaken, otherwise you can take it off again offline. I believe it's a positive effect on both P&L and cash flow.

Okay. So, it is negatively reported?

It's a negative amount, but I think it's defined as a gain, if it's a negative amount. I can double check.

Thank you.

Regarding the minimum annual guidance, to be specific, it's very difficult because there are one-on-one negotiations and they are confidential. But in general terms, I would say that, compared with the visibility we had, we have reached or close to reach conclusions, positive conclusions with around 70% of the total MAG we tried to negotiate.

Thank you. So 70% of the MAG or 70% of all the landlords, so that's...?

70% of MAC.

Where you see some willingness to negotiate.

No, we are negotiating and very close to terminate the agreement.

Okay. Thank you.

So, quickly checked the cash flow statement. So, losses are reflected as a positive amount and gains to reflect as a negative amount in respect to foreign exchange differences.

So, it's in indeed a gain.

I have one question. In case of new travel restrictions, what is your backup plan?

Backup plan travel restriction, well, what is the backup plan of something that we don't know, it’s a big complex to answer. But let's say, one thing, we have created a flexible company for adapting to the reality of the business today.

The cost structure that we have been explaining during the last few minutes is exact the backup plan. Because with this flexible cost structure, we can face whatever, let's say, worst case scenario may happen and there are many worst case scenario that we have seen, especially in March.

The situation regarding the openings or closings of markets is impacting the business. The answer is, yes.

But so far, what we have seen is more domestic traffic in the U.S. and domestic traffic in the European Union.

As far as the domestic traffic one place and the international domestic traffic in the second one in Europe is like today, but we have seen it gradually increases. Good news that I have to comment on is I heard that from yesterday, the Russians are starting to fly to certain countries and Brazilians too.

The consequence of that is that the direction of the reopening of the market is so far going in this direction more than in the closings.

So, what's that means that there would be a new focus on domestic traffic in the future?

Well, if there are during certain time there are domestic passengers like today, we are not going to focus in domestic passengers. We are going to attend domestic passengers because we are ready to attend domestic passengers.

Historically, our company has been around 60% duty free on 40% duty paid. For this reason, we have been for many years developing duty pay content, one of them is Hudson convenience store.

But there are other ones and this idea was really attend domestic passengers in most of the destinations where we are already operating and when we are already welcome in this type of passengers.

I had a couple of questions. Let me just appointed clarification on Slide 24 where you provide the sensitivity analysis, mainly for the concession fees as a percentage of turnover, could you just clarify what that would look like on a post-IFRS 16 basis, so that was taken at least in the interest cost would be pretty similar?

And then the second question was around, you commented on looking at potentially actively trying to refinance the 2022 maturities kind of a more to off time and would you start thinking about addressing those maturities?

Let me quickly start with the refinancing. So, there what we typically would do and we will also do it in this case is to refinance ideally 18 months ahead of maturity, which basically would bring you to a window between now and May of 2021.

Regarding the first question is sensitivity analysis based in a drop of sales that shows the possible percentage on turnover of consistencies pre-IFRS 16, why? Because in most of the cases we have heard, that with IFRS 16 especially in the way that is accrued, the MAG reliefs and the amortization of right of use is very difficult to follow up.

So, the reason we have put these three percentages. 33% on turnover with minus 40%, 36% on turnover with minus 55% and 79% on turnover with minus 70%, yes, our reference for showing how the evolution of the percentage on turnover is going to be based in the drop in volume of sales.

But this is just a reference point for understanding the situation. In IFRS 16 is very difficult to explain, because the impact different lines of the P&L.

Included these expenses, minimum on guarantee reliefs, the depreciation of right of use and interest of right, in financial expenses due to right of use, this is really compress to explain and very difficult.

And just a follow up on the refinancing, I guess, your bonds are trading in depending on the bonds were 7% to 9% use. How do you think about all, so how long would perpetuate versus the relatively high cost of refinancing in the current market of the current conditions?

It's something we will need to review. Once we start the process for the refinancing.

We are obviously looking into different products and different alternatives, but it's too early to comment on the final conclusion there. I mean, you can play with a lot of variables there with instruments, the duration, et cetera.

So -- but it's too early to comment on that.

Just to follow up on the disposals in this right-of-use asset movement. This is low 12 on the financial statements.

You obviously have an addition in there as well, which is the new contract in Spain. Does the disposal include part of that old Spain contracts?

Again, I'm just coming back to that, how much should we think about this net new concession line because at the moment it's 700 million of 505 billion orders is quite a big number.

Yes, absolutely. So basically what you have is, you have the new one which is add on to the number of right-of-use assets.

And the old one because we have signed and renews his ahead of maturity basically had to be deducted from that. So, you're absolutely right.

So, do you know how much it is roughly, is it like half of that disposals amount or?

I would need to double check that. I would assume it's probably well, yes, probably, or maybe even more but I would need to check that.

If I may, just in relation to the spending per passenger you mentioned, so far, you see that there is currently an increase of 20% year-over-year. So how can you explain that by yourselves?

Do you have a different profile of customers at the moment? And then just a question in relation to your impairment, so what I saw is that most of your impairments were goodwill, mostly those CHF30 million, mostly linked to Central and Southern America, but how about also potential impairments then of your activated concession rights on your balance sheet?

Can you also elaborate about that and why you haven't done the impairment testing yet on that concession rights by yet? And then just a last question is also in relation to other, let's say, sales channel.

So one of your competitors is also doing live TV shows to dispose some of the inventories in Asia quite successfully. So would this also be something you are thinking about?

Okay. I will start with the impairment then the confessions.

So basically I've done both. So we have tested goodwill and we have also tested the concession rate.

We have impaired also on both sides. So you compare to goodwill as well as in some areas to concession rate.

They are predominantly in Central and South America and also North American and both sides goodwill, and also with respect to the concession sites as well. That's not exactly correct the concession rate you also have to start extent in Europe.

But yes, on both, tested both and impaired on both sides. Regarding spend per passenger, the main reason is the different passenger profile compared with obviously one year ago.

And the inventories, the answer is yes, we are doing that, but today the quality of inventory we have is really good and we don't need to reserve inventories because we need inventory for selling in ourselves. What you identify as wholesale, there is a significant part of wholesale that is rid of inventories that are obsolete or in the obviously the process to termination in terms of validity.

But the most important part of inventory these are very good and it has a very good quality and will be sold through the shops that we hope we will reopen very soon.

Thank you for further taking my follow up question. It's again related to the cash flow scenario please.

I mean, let's assume that you are at minus 40% for the second half on sales. This would be an actual cash flow generation of maybe CHF300 million or CHF350 million in between this.

So much, much better versus normally like it was in 2019. And the question I mean how sustainable really this cost base is, how the cash generation is?

That it also means that for '21, if you are 40% below 2019 level, that we should expect a similar cash flow generation. And if not, where really is a bridge here?

No. Look, you cannot assume for 2021, a similar one, if you are 40% down.

What we have given as the guidance, the three scenarios apply for the second half of 2020. And as I've mentioned before, you need to be very careful when looking at the cash flows because there is certain seasonality in there or certain cash flows fly probably earlier or later during the year, so you'd be super careful with that.

If you're looking at 2021, the guidance may be a different one.