Core Viewpoint - The Chinese fast-moving consumer goods (FMCG) market is expected to remain in a low-speed adjustment phase in 2026, with an estimated annual sales growth of 0.9% [1]. Market Performance: Resilience Remains - As of September 2025, FMCG sales grew by 1.5% year-on-year, but the growth rate dropped to 0.7% in the third quarter, indicating increasingly cautious consumer spending [2]. Category Differentiation: Growth Drivers and Pressures Coexist - **Food Category**: Expected to be the main growth driver with a projected sales growth rate of 3.0% in 2026. Consumer demand for convenience, nutrition, and product upgrades supports this growth. In the first three quarters of 2025, growth was 3.4%, with a third-quarter growth rate of 4.4% [4]. - **Dairy Products**: Anticipated to decline by 6.2% in sales in 2026. In the first three quarters of 2025, there was a 6.1% year-on-year decrease, with a third-quarter drop of 6.8%, primarily due to increased competition from plant-based alternatives and heightened price sensitivity among consumers [4]. - **Non-Alcoholic Beverages**: Growth momentum is weakening, with an expected growth rate of 3.9% in 2026, down from 4.8% in 2025. The first three quarters of 2025 saw a growth of 4.9%, but the third quarter's growth plummeted to 1.7%, indicating future growth risks [4]. - **Alcoholic Beverages**: A significant shift is noted, with a slight expected decline of 0.6% in 2026. The first three quarters of 2025 showed a minor increase of 0.9%, but the third quarter experienced a year-on-year decline of 4.2%, reflecting reduced consumer spending on non-essential items [4]. - **Home Care Products**: Expected to perform steadily with a growth rate of 2.5% in 2026. The first three quarters of 2025 recorded a growth of 3.1%, with a third-quarter slowdown to 1.7% [5]. - **Personal Care Products**: Recovery is slow, with a potential flat growth rate of -0.1% in 2026. The first three quarters of 2025 saw a growth of 1.1%, but the third quarter's growth fell to zero, highlighting intense competition and consumer price sensitivity [5]. Structural Opportunities: Lower-tier Markets and Emerging Demands - Despite numerous challenges, opportunities exist in the market. Lower-tier cities are experiencing increased consumer demand, driven by the penetration of e-commerce, instant retail, and logistics infrastructure [6]. - Categories emphasizing health, functionality, and sustainability (such as plant-based foods, eco-friendly home products, and functional beverages) are showing strong growth momentum [6]. - Brands that can innovate to align with emerging lifestyles and promote product premiumization are more likely to thrive in a cautious market environment [6]. Summary: Agile Response to Complex Environment - The trend of cautious consumer behavior is expected to continue into 2026, placing pressure on corporate growth. Companies need to leverage data insights, closely monitor market changes, and swiftly adjust strategies to find survival and growth opportunities in this complex market [6].

Core Insights - Croatia's consumer price index (CPI) increased by 4.1% year-on-year in August, with a slight month-on-month rise of 0.1% [1] - The largest price increases were observed in housing, water, electricity, gas, and other fuels, which rose by 8.1% year-on-year, followed by restaurants and hotel accommodation (+7.5%) and non-alcoholic beverages (+6.3%) [1] - The harmonized index of consumer prices (HICP) in Croatia rose by 4.6% year-on-year in August, with an average month-on-month increase of 0.2% [1] Price Changes by Category - Housing, water, electricity, gas, and other fuels: +8.1% year-on-year [1] - Restaurants and hotel accommodation: +7.5% year-on-year [1] - Non-alcoholic beverages: +6.3% year-on-year [1] - Education: +5.9% year-on-year [1] - Medical services: +5.1% year-on-year [1] - Transportation: -1.3% year-on-year [1] - Clothing and footwear: -0.6% year-on-year [1] - Communication services: -0.4% year-on-year [1] Additional Insights - Service prices increased by 6.4% year-on-year in August [1] - Food, alcoholic beverages, and tobacco products saw a year-on-year price increase of 6.2% [1] - Energy prices rose by 2.5% year-on-year, while non-food industrial goods (excluding energy) increased by 0.5% year-on-year [1]

Group 1: Overall Performance - The overall performance of Hong Kong stocks in H1 2025 shows positive profit growth, with leading companies showing a stronger willingness to expand production. The revenue growth rates for major indices are as follows: Hang Seng Index at 1.98%, Hang Seng Tech at 15.98%, and China Enterprises Index at 2.42%, all showing improvements compared to H2 2024 [6][10] - The return on equity (ROE) for the Hang Seng Index slightly decreased to 7.9%, while net profit margin and leverage levels increased, indicating overall stable operational efficiency [8][9] Group 2: Industry Comparison - The AI and innovative pharmaceuticals sectors continue to lead in high prosperity, while real estate and certain cyclical industries remain under pressure. The healthcare and technology sectors show strong profit growth, with healthcare at 51.7% and technology at 31.5% [12][14] - Non-essential consumption saw a decline in profit growth, primarily due to negative performance in the automotive sector, while essential consumption profits increased, particularly in non-alcoholic beverages, which grew by 75.4% [17][18] Group 3: Performance Outlook - Profitability in Hong Kong stocks is expected to rebound in H2 2025, with most industries likely to see marginal improvements. Bloomberg consensus forecasts indicate a recovery in profit growth for the Hang Seng Index and Hang Seng China Enterprises Index [3][12] - High-prosperity industries such as healthcare, technology, and new consumption are anticipated to continue delivering strong performance, supported by favorable domestic policies and increased foreign capital inflows [3][12]

Core Insights - The Consumer Price Index (CPI) in Brunei decreased by 0.2% year-on-year in July, driven by declines in food and non-alcoholic beverage prices [1] - The main contributors to the decline in food prices were vegetables (-5.3%) and meat products (-2.3%) [1] - Non-food price index decline was influenced by falling airfares and reduced costs for online streaming services due to currency fluctuations [1] Year-on-Year Analysis - Food and non-alcoholic beverage index fell by 0.4%, while the non-food index decreased by 0.1% [1] - The overall CPI decline reflects a combination of specific food price drops and broader non-food price trends [1] Month-on-Month Analysis - The CPI increased by 0.1% in July compared to June, with food and non-alcoholic beverage index rising by 0.2% and non-food index by 0.1% [1] - The increase in food prices was primarily due to higher prices for fish and seafood (1.1%) and non-alcoholic beverages (0.9%) [1] - Non-food index growth was supported by increases in clothing and footwear (2.8%) and dining and hotel prices (0.1%) [1]

Financial Data and Key Metrics Changes - The company has increased its cost-saving targets from €500 million to €625 million, indicating a focus on improving operational efficiency [6][11][12] - The management emphasizes a shift from focusing solely on gross margin percentage to prioritizing operating profit dollars, which is expected to drive better growth decisions [20][23] Business Line Data and Key Metrics Changes - The company is looking to optimize its trade investment and advertising and promotion (A&P) spending, which have been growing at a higher rate than net sales value (NSV) growth [10][12] - There is a focus on reallocating resources to enhance media scale and reach through digital channels, aiming to improve return on marketing investments [10][16] Market Data and Key Metrics Changes - The management acknowledges that the U.S. market has shown growth primarily through a few successful brands, while many others in the portfolio are struggling [33][34] - The company is tracking consumer sentiment and spending power, indicating a cautious outlook on the U.S. consumer environment for the upcoming fiscal year [39][40] Company Strategy and Development Direction - The company is undergoing a strategic review of its portfolio to identify non-core businesses for potential disposal, allowing for a more focused approach on growth areas [26][41] - There is an emphasis on understanding consumer trends and occasions to better align the product portfolio with market demands [34][36] Management's Comments on Operating Environment and Future Outlook - The management believes that moderation in alcohol consumption is a continuation of long-term trends rather than a sudden shift, influenced by macroeconomic factors [29][30] - The company is not planning for a significant improvement in the consumer environment but is focused on managing controllable factors and building a robust growth strategy [39][40] Other Important Information - The management is exploring opportunities in lower alcohol by volume (ABV) products and ready-to-drink (RTD) formats to cater to changing consumer preferences [32][33] - There is a recognition of the need to rebuild commercial execution capabilities to maintain important industry relationships while optimizing costs [13][14] Q&A Session Summary Question: How is the company finding cost savings? - The company is focusing on supply chain efficiencies and reallocating resources to drive operational savings, with an expected cost of approximately €500 million over three years to achieve these savings [7][11] Question: How will the company maintain relationships while cutting costs? - The management acknowledges the importance of relationships in the industry and plans to reinvest a portion of the savings into commercial excellence and execution to strengthen these relationships [13][14] Question: What is the company's approach to marketing spend? - The company is looking at marketing spend holistically, focusing on effective allocation based on growth potential rather than adhering to a fixed budget [16][18] Question: How does the company view the structural versus cyclical debate in the industry? - The management believes that while there are cyclical elements, the moderation trend is more structural and influenced by various factors, including economic pressures [29][30] Question: What is the outlook for the U.S. consumer? - The management does not see immediate signs of improvement in the U.S. consumer environment and is cautious in its planning for the upcoming fiscal year [39][40]