Operator: Welcome to PPR’s First Half 2012 Results Conference Call. For your information today's conference is being recorded. Your host today is PPR Group Managing Director, Jean-Francois Palus and CFO, Jean-Marc Duplaix. Please go ahead.
Jean-Francois Palus - Group Managing Director: Good afternoon and good evening to all of you. This is Jean-Francois Palus, PPR Group’s Managing Director, and I'm pleased to welcome you to this conference call to discuss our first half 2012 results, which you should have received a few minutes ago. Together with Jean-Marc Duplaix, Group Chief Financial Officer, we will give you a brief introduction following the deck of slides you can find on our website. I will say a few words on our operating and financial performance in the first six months of the year. Jean-Marc will guide you through the results of our major activities and the key group financial highlights of the period, and I'll touch upon our objectives for the coming quarters before we take your questions.
But before we get there I'd like to say a word on the announcement we made this morning regarding our continuing disengagement from CFAO. As we had announced at the time of CFAO’s IPO, we had no intention of remaining a long-term minority shareholder in that activity. The transaction we have announced is in the best interest of all parties involved, (particularly) the future of CFAO and all its people and is based on an excellent valuation for this great asset. For PPR this disposal marks another important step towards our strategic focus on luxury and sport and lifestyle while enabling us to significantly reduce our net debt. Needless to say we are very pleased with this development.
Let's go back to the first half results. Overall, we are delighted with the full set of results the Group has delivered in the first six months of the year summarized here on Slide 4.
In what was another period of tough consumer environment in many parts of the world, Group sales were up more than 8% on a comparable basis. This was fueled by the jump in revenues from our Luxury Group brands all posting strong growth.
Recurring operating income rose by more than 20% in the first half, notwithstanding the lower operating profitability of our Sport & Lifestyle division and the small operating loss at Fnac. Operating income at all major Luxury brands posted solid increases and affected by their significant efforts to expand their networks and positioning. The Group share of recurring net income from continuing operation was up over 25% in the first half.
On Slide 5, we have given you a snapshot of our operating performance in the past year, highlighting the components of the strong sales jump I just mentioned. Our core activities in Luxury and Sport & Lifestyle together generated an impressive 12% increase in comparable sales, while Fnac down just 1% undeniably outperformed its competitors in the dismal consumer shopping environment we are currently seeing in Western Europe.
I want to say a few words here about the negative performance at Puma, whose recurring operating income was down about 9% from the first half of last year. I would like to insist on the fact that this is not primarily due to a shortfall in sales or brand positioning, that is above all a cost issue. We have mentioned to you in the past that we are not satisfied with our footwear sales in Europe. This was the case again in the second quarter and we are addressing this issue which will take a few quarters to correct, and is more than offset by strong demand in other markets and other products categories.