Beiersdorf AG

Thomas Quaas - Chief Executive Officer Bernhard Duttmann - Chief Financial Officer Jens Geissler - Corporate Treasurer & Head of IR

Matthias Eifert - MainFirst Guillaume Delmas - Nomura Philipp Frey - MM Warburg Iain Simpson - RBS Eamonn Ferry - Exane BNP Paribas Heiko Feber - Bankhaus Lampe Mark Christensen - Morgan Stanley Arne Rautenberg - DZ Bank Rosie Edwards - Goldman Sachs Financial Alex Molloy - Credit Suisse Eva Quiroga - UBS

Good morning, welcome to Beiersdorf conference call for the first nine months of 2010. This is Jens Geissler, together with Beiersdorf's CEO, Thomas Quaas and CFO, Bernhard Duttmann.

We will start with a brief presentation by Thomas Quaas and we will then come to question and answer. The replay of this call will be available on Beiersdorf’s IR website in the course of the day.

I’d now like to handover to Thomas Quaas and the result of the first nine months.

Thank you, Jens, and good morning and welcome from my side to all of you. Sorry for those who are in different the time zones, as we, after we’ll get you out of the allocation for earnings.

But let’s try to get quickly through the most important information. Before, we go into the details I want to give you my general view on the current business situation at Beiersdorf.

And I look to put it into somehow a prospective, after a couple of years of strong growth we all have to see the effects from the financial crisis 2009. And coming out of that, we finally decided that we’ll see a great opportunities to shape the future for our company in the upcoming years.

So we are right in the process, in the middle of the process to take final conclusion that make the final decisions in order to get the setup right for the next couple of years and then just fixing a couple of things for the next couple of months. So all we are doing now, we’ll talk about now its in the life of this kind of pre-comment that I want to, see also the result that we are facing in 2010 definitely we’ll see in that light, since we are shaping for a future, which is ahead of us.

So we, now we’ll continue in doing so and what the details of all this moving forward concept is going to look like, we cannot share in detail with you today, but we will certainly take up on those in the upcoming Investor Day I think as we communicated that on December the 15, and that will be in London. So please bear this in mind and then now I’ll take a brief look at the key figures of the first nine months in 2010.

On group, our sales increased by plus 8.1% on a nominal basis, if we exclude foreign exchange effect this is plus 4% on a like-for-like basis. The group EBIT was EUR552 million and this translates into 11.7% EBIT margin, profit after tax margin came in at 7.5% after three quarters into 2010.

The resulting number for earnings per share is EUR1.53 both the EBIT and profit after tax margins do not include material extraordinary expenses at this point in time. Now looking at the business segments, our tesa business again showed strong growth against increasingly tougher comparables of course from the back end of 2009.

All regions contribute to this increase and especially it is, Asian business was particularly strong on the back of good sales with our partners in the Auto and Electronics industries. On the profit line, tesa recorded an EBIT margin of 13%, so for tesa, now the sales in Beiersdorf’s consumer segment increased by plus 2.3% like-for-like in the first three quarters 2010.

NIVEA sales only the brand group NIVEA went up by plus 2.2% with deodorants NIVEA for Men and especially NIVEA Sun being our currently fastest growing categories. Eucerin, which is our top brands in the pharmacy channel, has shown a sustainable and solid performance again with a sales growth of plus 9.8 almost double-digit growth rates we can enjoy here.

However, the overall performance of the consumer business is somewhat clearly below our expectations again as I mentioned before I started my comments on the result as we see them here after nine months. And this actual situation, we have of course deflected in our guidance for the full year and I will talk about the updated guidance in a few minutes.

Let’s now look at the regional number for Beiersdorf consumer business in more detail. Total consumers sales in the first nine months of 2010 again we are plus 2.3% above last years number.

Looking at the sales development in detail, the German consumer business was slow and decreased by minus 1.6% compared to the first nine months last year. On a category basis, we have seen NIVEA body, Nivea Hair Care dragging down overall sales performance.

And as you know, we launched a promotional campaign in Q3, similar to last year’s activity, but it was smaller in size and then primary aims at building bonds with the consumers and not so much pushing for additional sales. Western Europe, outside of Germany still provided the same mixed picture as before so nothing new on that side, we have some highlight and I love to talk about the – in UK.

And also Switzerland is doing well at the same time quite a few countries underperformed and dragged down the overall consumer sales in the Western European world and launched dollars especially other dimension Italy, Greece, Portugal and Spain. In Eastern Europe, Russia, remains very strong with a like-for-like growth rate of plus 12.8%.

In almost all other countries in the region, we have seen very weak macroeconomic conditions on a quite tough competitive environment. Let us turn to the, good news now, in North America our focused approach continues to deliver.

A growth rate of plus 13.2% after nine months, is a very good result in a relatively weak market and it means that we gained quite a bit of market share. As you know, we quite often talked about the development, the concept and the strategies for the U.S.

some years ago we decided to focus our efforts in the U.S. market on just a few core categories.

We concentrated consequently on NIVEA for Men, NIVEA Body, NIVEA Lip and Shower and of course also on the user end brand all these is the key to our success in the U.S. market and this approach is currently serving as a more or less role model for overall consumer business strategy focus on skin care again that is what I try to indicate in my opening comments today.

It is now too early to talk about the total implementation of this approach today. But again, we will do so, together with you on our upcoming Investor Day in December 11.

Let’s move to Latin America, it’s still running strong and Brazil is an important highlight in that region. In the Southern Hemisphere, we are currently having the high season of course for some protection product.

So NIVEA Sun is our main driver together with NIVEA Visage and NIVEA for Men. The so called AAA region has gained a little feed primarily due to the strong growing business in Thailand and Middle East.

And in China, our hair care and styling business is doing okay, keeping it positioned overall China still, a pretty difficult and very busy place. I would now like to take you to next slide, where we’ll take a closer look at Latin America.

And actually we do this always in this presentation that we give a few highlights on both direction, one goes more into what do we experience in some regions and what do we see as interesting information for you on the product fact. So let’s start with the regional details this time, on Latin America.

As you know, Beiersdorf is a very long standing presence in Latin America. We have seen stable and, even more important, sustainable development of our business on this continent, and year 2010 is no exception to that.

The region is a big market for, especially, deodorants of men’s care and now again, especially, sun protection, that also NIVEA Visage is showing a strong developments for Beiersdorf in this region. Silver Protect has been launched as a deodorant recently in Brazil and has been received very well in the market.

On the EBIT line, Latin America has increased its contribution to the group results significantly during the last years. The current double digit EBIT margin of the region is proving NIVEA’s strength in the market.

And after many years of investment, we have successfully built brand equity and also seeing the return coming in. While this covers the regional effect I wanted to highlight for today.

Let’s now talk about some product launches and again, it’s only a few highlights as we usually do in this kind of presentation. Deodorants, Deodorant have been one of our best performing categories in the past, in the first nine months of 2010.

Sales of the category grew by plus 10% globally. On the slide here, you can see one of the latest additions to our assortment it’s the Teens range called Angel Star.

It has been received very well. And deodorant are of course part of this new line for Teens color and scents like raspberry, very appealing for the target group, young teenage girls like the ones on the picture.

Beiersdorf deodorant business in general it’s making good progress what ever we now present in this category and the best countries for our strategy are Brazil, Russia, Thailand and Middle East, maybe one additional comment on the deodorant, we regarded as the clearly well connected category when it comes to Beiersdorf core competencies in skin care since we have identified the opportunity to combine the heritage of the NIVEA brand, which is superior skin care benefits with of course the benefits that needed in the certain and relevant category in this case deodorant. So of course the vital deodorants as opposed and have to deliver excellent features on the deodorant side efficacy and whatever it’s need, but in combination with the carrying benefits of the NIVEA brand which makes a very powerful brand that wonderful and big and future oriented market.

Let’s [Inaudible] give now and take a look at our luxury segment, where I’d briefly like to talk about the La Prairie brand since we all understood that in 2009, in the crisis year La Prairie has to – slight struggling like everybody in that area, now La Prairie has regains, a lot of feeds in 2010 after the nine months, sales are up like plus 10% or 10.6% versus last year. We are supporting on top end proposition by introducing a new line, which is called White Caviar you might know the Blue Line, which is one of the traditional successful heroes in the La Prairie system, which we call the now here White Caviar Illuminating System, which is the multitasking luxury system of fast penetrating formulas.

It addresses especially aged and evenly pigmented skin. The system comprises of three components, is a cream and two highly concentrated [Inaudible] for the face and the eyes.

In addition, La Prairie has also launched new product in its fragrance line, they are called [Inaudible], the Ruby, Emerald and Sapphire. All these innovations have been introduced in September and are being received very well by the La Prairie customers.

So as to complete important part of our business effect on track however this is not just a case for full scope of our modern channel portfolio and that will take a brief look as that issue.

We are addressing the issues and have put many activities on their way and I’m convinced that this will improve our business medium and definitely will build the basis for long-term development. I will give you one example.

Our assortment still contains too many slow-turning SKUs, which only adds usually complexity, but do not really contribute to sales growth nor profit. This is why we took the clear decision to clean up the place and clean, by doing so, our consumer portfolio, but that of course means a drag on our sales development.

And you can see some of that are in the relatively slow growth of the last quarter. So it’s cutting of course first, but the adequate remedy at this point in time and again to provide the basis for a future with strong solid-performing assortment.

And once you have to go through that in order to make that road clear. We see the benefits from this activity and many others, it involves one year from now.

And also again, this reflects in also managing expectations, this is not done in one quarter, this is a task that takes a while. The healing process is not in full swing yet, it is currently being ramped up.

Therefore, I do not think that it would make sense to talk about our strategy implementation concept prematurely. This has been the reason for canceling the Analyst Meeting initially scheduled for today, usually would have met in rainy Hamburg today.

But instead of that, we have provided a new date, which is the Beiersdorf Investor Day in London next month. I certainly hope to see you then all there on December 15.

Let’s now move to my last slide for today, this is the guidance for the full year. So what I just said is reflected in these numbers.

In consumer, we expect like-for-like growth of about plus 2% for this year. The EBIT margin in this business will be about 11%.

In tesa, we think that we will arrive at sales growth of 10% to 11%. Please keep in mind that last year’s comparables are becoming tougher.

We have raised the guidance for tesa’s EBIT margin to above 10%. This number now implies a somewhat less profitable last quarter, but this is in line with typically low profitability in tesa and so-called normal years and tesa definitely seem to be back normal after a difficult year 2009.

On the aggregate, Beiersdorf Group level, this means the sales grew of plus 3% and EBIT margin of about 11% and the profit after tax relative to sales of about 7%. These numbers are stated on an operative basis.

This concludes now my set of slides. Thank you for your attention and I’ll now hand over back to Jens Geissler.

Okay, this concludes the presentation and we are now ready to start Q-&-A.

Yes. Hi, good morning.

I'm Matthias Eifert from MainFirst. I wanted to know what the current situation is in China.

You were saying that the marketplace remains pretty difficult. I mean, my sense is that the overall market there is growing by about 10%.

But could you give us a bit more detail what the current issues there are at the moment?

China is probably way ahead in all the events in the last three, four years and when I’m saying that China is a difficult market, I want to, yes, again emphasize that and what is difficult. Difficult in a way that, number one that China is a huge market and with a huge potential.

So this is absolutely unchanged and for us definitely in that dimension still one of the top focus regions that we would concentrate and continue to concentrate in the years ahead of us. Number two, for a couple of years, we were enjoying growth rates in Beiersdorf, which was extremely high in the 30s, even the 40s and also that in the light of market dynamics which were in the plus 20s and even above of that.

This huge dynamic in the market there has somewhat decreased. It’s not that hot anymore but still delivering quite a nice growth rate into one that you mentioned something like plus 10%, also in the market I think that’s a realistic view seeing the situation in the Chinese market.

So, difficult now in a way [Inaudible]. And number two, complexity, market participants has increased, efforts of everybody has increased and therefore the whole rate now is in who is making the best progress in getting the structures right and getting well prepared also from an infrastructure point of view into the future.

We in Beiersdorf, we had all established business there and as you know we decided for an acquisition in order to increase our footprint in China and also to add one new business field. That new business field we acquired was something, which we evaluate as good quality and as we see it today, all this is still truly in line with our expectations.

The brands from C-BONS that we bought both Slek and Maestro are still performing well in their categories. We are now preparing for the next step and all this was the part of the total program that I talked about when I opened my presentation today, that we have a global new setup on our new strategic concept focus on skin care and closer to market and also China and our activities in China will be reflected in that light.

So all this is ahead of us. And I might be able to give a little bit more flavor of it, concretely that means when we have the Investors Day.

Okay. Yes, I mean, most questions would be about the whole issues you probably discussed on December 15.

But maybe one word on the Big Bang campaign in Germany. You said in Q2 you suffered because you had a high comparison basis because of the sell-in into trade last year ahead of the Big Bang campaign in Germany.

And now in Q3, you had the campaign, and can you quantify the impact or tell us how happy you are with it? And if you had similar effects like last year with gaining market share and people trying new product categories and those kind of things?

Yes, thank you for that question. Maybe it gives me the opportunity to put that activities, again in the dimension where we actually wanted to see that promotion.

When we did that in 2009, this was in the middle of the crisis, and we saw hefty price activities from almost everybody in the market trying to catch growth in sales opportunities. And again we, Beiersdorf, are definitely not the leader of the gang when it comes to price activities, since we usually perform on brand and innovation quality and try to penetrate our brands into Beiersdorf brands into the household.

So therefore, our Big Bang activity in 2009, again 2009 was designed to, yes, of course capture sales, being attractive from a price point of view, but more important was the market fixing target to bring various products that was part of this deal of this promotion that you are only eligible to the price when you are buying, definitely more than three products. So that had a big effect in 2009 and we repeated the concept in 2010, but the magnitude of our concept in 2010 was designed to be definitely smaller and not that aggressive as it was in 2010, still trying to capture the marketing target.

So, if you want to give it in quantitative, I will not give you, cannot give you percentages on that, but it was a less big effect, much less big effect when you compare to 2009. From the marketing results, we are very happy.

Okay, great. Thank you.

Good morning gentlemen.

Good morning.

Two questions from me. So firstly, could you walk us through the market share development of your NIVEA brand, because with a growth of 2.2% for the first nine months, it would suggest you are actually losing shares?

So if you could give us some granularity on that it would be great. And my second question is about the other operating result, it came in at minus $83 million for the first nine months.

Now, this seems to imply a greater negative impact for the third quarter relative to Q1 and Q2. So should we read into that that you have taken some additional restructuring initiatives in the last quarter?

Thanks for all the questions. Let me start with question number one and I guess our CFO, Bernhard Düttmann is going to comment again today, referring to your second question.

With respect to market share development, we see a mixed picture in 2010. We have areas where we really enjoy good progress for the NIVEA brand worldwide and particularly also some regions, so that is valid for NIVEA FOR Men, that is valid for NIVEA Sun, that is valid for the deodorant business.

And actually, outside of Europe, we are definitely not losing shares, we are actually moving forward into most of our categories. In Europe, the picture is different.

We have said already in several occasions before. Here, we have to fight for the positions that we’re having.

And I don’t want to put this in to sunny picture here. We see areas where we lost some share and therefore we definitely put up the new strategic concept which is focused on skin care, which is made and designed to do a couple of research activities when it comes to quick value for the future in order to regain those market shares where we lost them.

And with respect to the second question, I would like to handover to Bernhard Düttmann.

Yes, good morning. I’m Bernhard Düttmann.

The question was what about the other operating results. We see a big swing compared to last year.

Why do we have this biggest effect? Biggest impact in this number is the foreign exchange losses from our hedging policies, as you know, we are hedging most of our exposure for the planned sales in the previous year.

And with the change of the Euro exchange rates, that leads to losses in 2010.

Thank you very much.

Hello, gentlemen. First of all, probably on, you mentioned SKU reduction as a one burdening factor for do you say you are off of slow performance in the consumer business in the quarter?

Could you give us a bit of flavor to the extent of that burden and well in which areas, region, was it across the board implemented already? Or how much burden are we going to see in the future?

And actually shouldn’t that lead also to have quick increases in margin as well once you reduce complexity? Just a bit of flavor on that one.

You’re mentioning one of the most important elements of the concept that we will provide as a full concept or it’s one of the activities that we are providing for safeguarding and again a long-term future. And SKU reduction is something which, I don’t know how the whole world, how our competitors and all the other participants in the market are seeing that.

We decided in our company to start the journey into the most efficient assortment now. And the starting point is just to be globally rolled out and of course we will do these things in a sensitive way but still in a very decisive way.

So, I cannot give you a percentage on the sales amount, which is going to be taken away from this. More important is that, usually you talk about a lot of SKUs and the complexity coming from these is huge.

The sales effect is only a secondary thing, but for us the important target is to get the complexity out of that and the whole worldwide supply chain fully brought into bigger and better efficiency. And last but not least, and the final and the most important thing when it comes to participating, communicating and cooperating with our retail partners in providing best point-of-sale solutions for supporting our brands, yes, of course we find very open ears for these activities, because it’s meant to make also the shelf on the retailers side, with at least the NIVEA assortment a much more efficient one.

And that’s a process that we start, we just pull up that initiative. So in some markets, we already see the first results from that.

The typical method to do that is an ABC analysis of the assortment and we regionally now begin to move forward in executing that. The main effect from this we’ll not see this year, was only starting effect.

The bigger effect will come in 2010.

Okay. Just a follow-up on that one.

Should we assume that especially in your mature markets like, for example, Germany, why the potential for complexity reduction is substantially larger than in particularly emerging markets?

That’s something which I would follow, because of course it’s just natural that in the most mature markets we of course have the widest and biggest and best penetration of assortment. And especially here, where we have strong positions, the strong is actually in most of the categories where we are in, the tendency and this is a very normal procedure in our industry that you tend to add here something and there something, which finalizes fine from an individual segmentation point of view in marketing, but in the final it does not really serve to improve the quality of assortments.

So I will join you in expecting the effect from that to be the biggest extent in the Western European countries.

Great. One final question on Eastern Europe, you saw now some improvements in your organic growth.

Do you expect a lasting improvement in the growth dynamics of the region? What's your view on that one?

Very reluctant. Very, very, very, yes, and absolutely not joining those who are only jumping on the table and see industry, our categories back to huge dynamics.

The good news here is that the biggest market also for us is New Russia, after actually only a small dip in the beginning of the crisis in 2009. In the final end, Russia tends to remain stable when it comes to consumers being interested in our assortment.

So, yes, I see this ongoing, because the Russian economics and environment seems to provide a good and solid and also a good basis for us to sustained development. So I see ongoing good positive development.

For all the other, especially the smaller Southern, Eastern European countries, I do not see that this – the macroeconomic situation will change fast. So therefore I am reluctant in seeing great dynamics coming back there very soon.

Thank you very much.

Good morning. Just a couple questions if I could.

I think you previously talked about China breaking even by 2012 and North America breaking even by 2011. Are they still intact?

And I suppose, just secondly, just to understand your portfolio pruning, am I right in thinking that you kind of did the portfolio pruning in the third quarter this year and so we will have fully lapped it, as it were by third or fourth quarter 2011? Or is that an ongoing process and we'll see more portfolio pruning over the next few quarters?

Thank you very much

Sorry, could you go back to the second part of your question, please? For something…

Yes, sure. On the portfolio pruning, I’m just looking to understand…

Our portfolio pruning, okay. And the question on portfolio pruning?

It's the timeline. Have you done all the portfolio pruning now?

So we will see you finish lapping that at the end of 2011, or will you be pruning the portfolio more over the coming quarters?

Okay. Let me start with the portfolio pruning initiative.

The typical method to do that is we came with ABC analysis, which we do country by country, or region by region. I think I mentioned that already we have installed a new regional responsibility concept in managing our company with three board members.

One for Europe, the other for Asia, the other for the Americas. So these groups and teams work together in identifying country by country, then region by region and all this mixed and finally the global footprint in getting on the basis of an ABC analysis, the assortment pruning concept on the table.

Now again, this is something which has then to be implemented in a very sensitive way since if you want of course. Given the innovation power that our company has and we of course will provide innovations to come.

So in the final end, there will also be a huge competition from new assortments coming in, but those new assortments then would be addressed to the new strategy focus on skin care. So we will exchange the assortment as we have it today in an active, decisive way from a strong assortment with some we go into it, if we finally succeed, on the strong assortment and this again is a process, starts now, goes through all 2011 and I would even say in fact from that going into 2012, but let’s talk about that later.

With respect to your breakeven questions, the China thing, as I said, China is turning to be a difficult place to be in. We made our first plans, our strategic concept back in 2006, when we began to provide the company internal targets that we also made them available to the outside world.

And then we did our acquisition, then we were preparing for the future. And as I said in my opening comments, we are shifting our activities towards the global focus on skin care thing and also China is part of this concept.

So therefore, we still do not talk about new plans in China. So from today’s point of view, no real change, but I think and I would see that moving forward there might be some changes to timing in order to prepare for the future.

So, all that in the light of China being a little bit different from where it was from the expectations three, four years ago. With respect to the Americas, we said that we have a plan that we put in place, a strategic plan to reshape the strategic structure of our company.

Most of the initiatives have been installed, breakeven is supposed to be 2011 and I see no change in that. This will come, since again I see a especially the whole setup operationally and strategically North America as being somewhat the role model of shifting our energy and focus to skin care and benefiting from that and all this works very well in the Americas as we see it right now.

Okay, thank you very much.

Thanks. Hi, gentlemen.

Good morning.

A few questions from my end. Firstly, on China, just to touch on that again.

Clearly, the C-BONS business now it doesn't naturally fit in within your global skin care strategy. Profitability from what you just said would seem to have been pushed back further.

Is the Board considering getting out of Chinese hair care, given what you've seen there?

Getting out of Chinese hair care.

Second question is regarding tesa. What have you seen on the input cost inflation front?

And what actions are you planning there to combat that, if any? And the last question is on – I think in Q2 results, you seemed pretty confident that you could outgrow the markets, which I think you pitched at 2% to 3%.

What happened in Q3 that meant you fell short of those expectations? Thanks.

Sorry, the last part of the question, did not really come loud and clear.

Sorry, yes. You seemed pretty confident at the end of Q2 results that you would outgrow the global cosmetic markets in the second half.

You pitched at a 2% to 3%. What happened in the quarter that meant you missed those expectations?

Let me start. Yes, thank you, now the question is clear.

Let me start with China again and your specific question on C-BONS and hair care and how is that in the light of the strategic setup. C-BONS is an acquisition we like to do and we are still happy that we did it, since it was done for three purposes.

Purpose number one, we wanted to increase our footprint in China with a one-step activity in order to have just bigger scale in terms of research capacities, R&D capacities, shelf presence, et cetera , et cetera. And in the final end, also infrastructure in the Chinese market when it comes to sales force and distribution.

So, now it is hair care since we always say when we acquire something that always I’ll answer to the M&A thing. The only acquisition when it’s a leading brand and both brands Slek and Maestro in the hair care world and leading brands there and therefore we acquired it.

Now good news, number one again, this business as we acquire it with a certain business plan and all this is in place, all this is going actually quite well along with our business plan. So nothing wrong with that.

In the light of focus on skin, yes, we’ll see the benefits from again also this acquisition since as I said we acquired also infrastructure, distribution infrastructure which will be part of the game when it comes to providing a bigger platform for distribution of the skin care business, NIVEA business in the Chinese market and this is part of the plan that we look forward into 2011 and ‘12. So this is something that we are working on.

With respect to tesa and the third question, could I handover to Bernhard?

You asked about the input inflation costs in tesa. We expect inflation cost on the material front.

On the other hand what we enjoyed over the last years and that will be continued to enjoy, is the mix effect, a better mix effect over some more specialties, moving away from commodities. The crisis has increased this pattern and for that reason we still expect continuous margin increase from the tesa segment.

Could you quantify the inflation you are seeing in your cost base, please?

Looking at the overall trends that they are expecting some increases, but it’s not, they don’t see it as dramatic.

And there’s always this effect of delayed impact coming from the long-term agreements with the suppliers. So that also is something that will make it difficult to….

And now with respect to the last question, the third quarter, when we have the talked about 2010 at the end of the second quarter, all this of course was done in the light of developing our new strategic setup for the future. And some decisions at that point of time has not yet been taken.

I had talked about this assortment pruning initiative as one of the activity. That will be always the first effect in the third quarter.

Now seen in that, all is built in to the guidance that we gave for 2010.

Okay, thanks.

Yes, thank you very much. I have just two questions.

One concerns your gross margin, which was lower than in the second quarter. Can you little bit elaborate on this effect of raw material prices and what happened there?

And the second question is on your tax rate, which was quite high in the third quarter. Are there any special effects?

If there is something going on we have to keep in mind for the future. Can you elaborate a little bit on that, please?

Thank you.

You’re referring for the gross margin of the single quarter three, that was your question?

Yes, that was my question.

What we’re looking at here is that, typically as the seasonality in our EBIT development coming from sales of different product and say our sales mix that is of course coming initially from gross margin so we don’t see anything unusual in gross margin at the same point of time. But we see an increase over last year.

[Inaudible] understand the question. In relative terms and absolute terms in both numbers it’s an increasing number.

Okay. I was just wondering if there was something going on with raw material prices?

No. In general, just please remember that we do have the seasonal figure in our numbers and the quarters typically, its like more than 1 percentage point what we see in EBIT drop on a quarterly basis accumulated from the start of the year until the end of the year and that’s part of it.

Okay. Thank you.

Excellent.

Our tax rate has been high because we have to consider some post payments from previous years, which we had to consider in this third quarter segment.

The tax rate is always an aggregate number from our global businesses. So there’re always ups and downs.

And at this time we have some payments concerning last, some past quarters, and this is what you’re seeing here.

But, it’s an initiative we take them full.

Yes, it’s higher. But it’s been impacted by some individual payments we have to make.

Okay. It's a third-quarter effect only.

Okay. We have, I think, one more question here from Mark Christensen.

Yes. Good morning.

Just a quick one for me. On the comment of the C-BONS acquisition proceeding along the lines of your original business plan, does that include the normalization of that enlarged investment from last year?

Is that normalizing as you had expected throughout this year? Or is it perhaps a difficult environment that you talk about in China, meaning that it's sort of being maintained at a higher level?

It will continue to be on a high level. No question about that.

But as we said, we have a peak, and from the peak, we wanted to move forward. And again, the overall business plan for that piece of business so far has not yet changed.

But, moving forward, shaping the whole concept that is ahead of us. And we are working on the final new concept which is finally, is going to meet for both companies in the light of course seeing the synergy effect, which was again built into the, our acquisition program and we are now approaching exactly this topic.

So in that light we will of course then finally look at what has to be reconsidered in terms of which and what and where will be supported to what extent.

Okay, sure. Thank you very much.

Thank you.

Hello, good morning everybody. Just a short question next regarding the outlook MRI that you decreased your outlook for consumer and margin from clearly above the 11% to above 11 or it’s just the type or so?

It’s correct, that we have changed our guidance, number one we have changed the sales outlook because we already, what we addressed already for the quarter three we have some impact from the first tuning activities which will also continue in quarter four and the upcoming quarters and the same applies to the, for the margin that we also, that had an impact on the margin and that we also had to considered in our current margin guidance.

Okay, thanks.

I don’t see any further questions.

Okay.

Good morning, I just wondered whether you had a response to the comments made by Bob McDonald, the P&G CEO in a Bloomberg interview back in September.

No, no comments, I don’t know, I was not present in that event, but just no comments from our side. We are fine.

We have wonderful business concept, we have a wonderful way forward. We have this stable [Inaudible] we have plans for the future.

So from our point of view, nothing to comment on that side.

Okay, thank you.

Good morning guys, its Alex in fact. Just a quick question on Asia and China.

It seems that through the quarters the total sales number in that region Asia is not so different. But the investment seems to be moving around, is that just how it looks from the outside or it seems you’re investing more in one quarter, but not in the other.

How should we look at that?

No, definitely not quarter-by-quarter, since our investments throughout the year is result of planned investment, which does not go for any spontaneous, or whatever kind of supports that usually at least, look at. And when it differs from quarter-to-quarter as we follow that report, that this is type of course what is done in certain quarters and this always it lead to launch and re-launch plans when we have innovation and put them into the markets we have of course the media support going up.

And then in other quarters we have more regular media stream. So that usually deflects only the flow of the so far planned activities.

So there is nothing really behind the variations from quarter-to-quarter.

Okay. So, just to clarify.

In China, there hasn't suddenly been the need for more investment than previously planned, it's just the normal variation from quarter-to-quarter around launches, re-launches, et cetera, or am I incorrect on that?

No, the usual way to look at that and I don’t see any specific point on that one.

Okay. Just following up on China.

Originally, you guys had said you plan to breakeven over the next couple of years. You seem to be perhaps stepping back a little bit away - stepping back a bit from that.

Are you changing your approach in China? Or you sounded that you’re reviewing your strategy in China now.

And perhaps the new business plan that you present will not be one that has break even by 2012?

Yes, again, the number one, China a little bit more difficult than it was three, four years ago. Number two, for us important region and will remain to be an important region.

Number three, we have strong businesses in place. Number four, we have strong investments in place.

Number five, we are preparing for the future for the total company on the global scale. And again, when we are in London, we will talk about that in more detail and the China is in one piece of the whole set up in the light of the new overall situation.

Thank you.

Yes. Good morning.

I was just wanting to follow-up on Eamonn's question. You just historically said that you expect the market to grow 2% to 3% this year.

And I understand that because of the pruning you are now expecting to outperform the market less. But can you maybe share with us what you see happening in the market?

Do you still think the market is growing 2% to 3%, or is the environment softening? And secondly, I was if you could just comment on La Prairie, which has had a good performance.

Is that merely a reflection of very easy year-on-year comps? Or do you see a real pickup on that side of the business again?

The last one, La Prairie was heavily affected in 2009. Like I said, everybody in the industry, especially in the luxury industry, only a few actually did well.

But usually 80% of the participant of that business had huge difficulties in 2009. And so did also La Prairie.

And what I think, I said that very loud and clear over that. In La Prairie, the good thing about this is, it is a strong, strong brand equity.

Therefore we and buyers who like La Prairie so much because we love brand with this huge equity, not just some business effects. Equity is, for us, the most important thing.

And we knew, even throughout the crisis, that the La Prairie consumers are very loyal consumers. So therefore we had some pushback on this kind of, try to retail, going shopping last minute, buying something, taking it home.

All these things that reduced sales last year significantly, but from that point, we are now back to more normal global behavior. And again, the whole loyalty in La Prairie now pays back and we see the consumers still being loyal to that brand.

New consumers coming in, new resources are coming in. I see La Prairie on a good track as we move now in to the most important part of the season for La Prairie business, which you’d say, last quarter Christmas, et cetera, so that for La Prairie is, from my point of view, in excellent shape.

Your first question versus the environment although, everybody is tentatively pulling out all the positive news about the coming here, coming there. I want to not think so loud.

Again we, don’t, you should forget, we’re just one year after the biggest crisis we’ve to face for quite a while. So 2009 was what it was.

We had to face the duration. We took a lot of decisions in order to make sure that we provide for the future, and definitely I can tell you that we are providing for a future and all the whole organization of Beiersdorf is providing for future, which offers flexibility in terms of reacting on certain ongoing softness and also, of course, being ready when in some areas in the world, the dynamics come back so that we are ready and then fit in order to communicate and that’s quite quickly.

And so, but that back to here dynamics, I don’t see it on a global scale, the difference are still there. China is not at the level that it was before crisis, although also in the crisis China did not go away from active development, but it’s not the 30%, 40% anymore it’s something between 10% and 15 %.

But that’s on going. In the other Eastern Asian world I see on going activities like that, Latin American, unchanged good, North America quite different slow not really active, not really bad, but we’re performing very well in that part and for Europe I see no change for the old ground the business is a very mixed picture.

Russia okay, Western Europe struggling for finding sustainable position and I don’t see it get that right.

Thank you.

Yes, thank you for your questions and for having joined our conference call. Beiersdorf’s next Investor Relations event will be the Beiersdorf Investor Day on the 15 of December in London.

Please remember we will have important message for you. I hope that you have registered already.

You can find the link and our invitation, which we have sent yesterday. Thank you for your interest in Beiersdorf and goodbye.