Financial Data and Key Metrics Changes - The underlying profit increased by 27% year-on-year to HKD 8.62 billion, primarily due to the sale of non-core assets in Miami and Hong Kong [3][16] - Recurring underlying profit declined by 3% to HKD 6.26 billion, largely due to the loss of rental income from the disposal of Brickell City Centre and lower office rental income in Hong Kong [16][17] - The company declared a full-year dividend of HKD 1.15 per share, marking a 5% increase year-on-year, consistent with its commitment to mid-single-digit annual dividend growth [4][18] Business Line Data and Key Metrics Changes - The office portfolio in Hong Kong experienced a 5% decline in attributable gross rental income, with overall occupancy at 91% [9][17] - Retail sales growth was positive across all malls in Hong Kong, with occupancy maintained at 100% [10][17] - In the Chinese Mainland, retail rental income increased by 2%, with overall retail sales up 7% year-on-year [11][12] Market Data and Key Metrics Changes - The Chinese Mainland portfolio now contributes 43% of the company's attributable gross rental income, with retail contributions exceeding those from the Hong Kong office portfolio [10][12] - The overall valuation of the investment property portfolio stood at HKD 268.3 billion, reflecting a 1% decrease from December 2024 [18][19] Company Strategy and Development Direction - The company is focused on an active capital recycling strategy, with HKD 100 billion investment plan aimed at driving growth over the next decade [4][7] - There is a commitment to enhancing shareholder returns and delivering mid-single-digit annual dividend growth [4][29] - The company plans to double its gross floor area in the Chinese Mainland by 2032, focusing on retail-led mixed-use projects in Tier 1 cities [7][12] Management's Comments on Operating Environment and Future Outlook - The management expressed confidence in the resilience of the business despite current geopolitical tensions, citing strong performance in retail and office sectors [27][28] - The outlook for the office sector in the Chinese Mainland remains subdued due to high vacancy rates, but there is optimism for improved leasing activity in Hong Kong [28][29] - The company anticipates continued positive momentum in retail sales and foot traffic in the Chinese Mainland [27][38] Other Important Information - The company achieved significant sustainability milestones, including a 52% reduction in Scope 1 and Scope 2 emissions, and a commitment to net-zero emissions by 2050 [22][24] - The company has been recognized for its sustainability efforts, ranking number one in the Hang Seng Corporate Sustainability Index for eight consecutive years [21][22] Q&A Session Summary Question: Expectations for China retail momentum in 2026 and performance during Chinese New Year - Management expects positive momentum to carry into 2026, with double-digit improvements in retail sales and strong footfall in centers [36][38] Question: CFO succession and continuity in capital allocation priorities - Management confirmed continuity in strategy and capital allocation priorities, with a focus on mid-single-digit dividend growth [40][41] Question: Plans for issuing C-REIT and pre-leasing data for new retail malls - Management is monitoring the C-REIT market and is open to opportunities that enhance capital efficiency [47] - Pre-leasing is progressing well, with collaborative design processes for new malls [48][49] Question: Impact of Middle East conflicts on office decision-making and retail sales leakage - Management noted a pickup in inquiries and leasing activity, but anticipates some hesitation in decision-making due to geopolitical tensions [59] - Reduced leakage of retail sales to other markets has been beneficial for the company's malls in the Chinese Mainland [60] Question: Long-term impact of AI on office demand and portfolio mix - Management is actively considering the implications of AI on office demand and is focused on providing high-quality office products [62]

Financial Data and Key Metrics Changes - The underlying profit increased by 27% year-on-year to HKD 8.62 billion, driven by the sale of non-core assets in Miami and Hong Kong [3][16] - Recurring underlying profit declined by 3% to HKD 6.26 billion due to loss of rental income from disposed assets and lower office rental income in Hong Kong [16][18] - The full-year dividend increased by 5% to HKD 1.15 per share, marking the ninth consecutive year of mid-single-digit dividend growth [4][18] Business Line Data and Key Metrics Changes - The office portfolio in Hong Kong experienced a 5% decline in attributable gross rental income, with overall occupancy at 91% [9][10] - Retail sales growth in Hong Kong was positive, with occupancy rates maintained at 100% across major malls [10][11] - The Chinese mainland retail portfolio contributed 43% of attributable gross rental income, with retail rental income increasing by 2% [10][12] Market Data and Key Metrics Changes - The Chinese mainland retail sales were up 7% year-on-year, with significant growth in foot traffic and sales [11][12] - The office market in the Chinese mainland remained stable despite oversupply, with a focus on integrated mixed-use developments [12][28] - The overall occupancy in the office portfolio in Hong Kong improved, particularly at Pacific Place, which reached 96% [9][10] Company Strategy and Development Direction - The company is committed to a HKD 100 billion investment plan, with 67% already committed to various projects [7][8] - Focus on capital recycling strategy, successfully divesting non-core assets to fund growth and maintain a strong balance sheet [5][7] - Emphasis on retail-led mixed-use projects in Tier One and emerging Tier One cities in the Chinese mainland [8][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business despite current geopolitical tensions, with a positive outlook for retail performance in both Hong Kong and the Chinese mainland [27][28] - The office sector is expected to remain subdued in the Chinese mainland, but the company anticipates benefits from the flight to quality trend [28][29] - Healthy demand for prime residential developments in Hong Kong and Southeast Asia is expected to continue [28][29] Other Important Information - The company achieved a 52% reduction in Scope 1 and Scope 2 emissions, surpassing sustainability targets [22] - The company maintains a strong liquidity position with available committed facilities totaling HKD 62.6 billion [20][21] - The company received multiple sustainability awards, including ranking number one in the Hang Seng Corporate Sustainability Index for eight consecutive years [22][25] Q&A Session Summary Question: Expectations for retail momentum in China for 2026 - Management expects positive momentum to carry into 2026, with double-digit improvements in retail sales and strong footfall in centers [36][38] Question: CFO succession and continuity in capital allocation - Management confirmed continuity in strategy and capital allocation priorities, with a focus on mid-single-digit dividend growth [40][41] Question: Plans for issuing C REIT and pre-leasing data - Management is monitoring the C REIT market and is open to opportunities that enhance capital efficiency [47] - Pre-leasing is progressing well, with collaborative efforts in designing new malls with brand partners [48][49] Question: Impact of Middle East conflicts and AI on office demand - Management noted a pickup in inquiries and leasing activity but anticipates some hesitation in decision-making due to geopolitical tensions [58][59] - The company is considering the long-term impact of AI on office demand and is focused on providing high-quality office products [62]

Financial Data and Key Metrics Changes - The company is projecting a 10% year-on-year growth in passenger capacity for 2026, despite a fleet growth of only 4% in passenger aircraft [3] - Jet fuel prices have almost doubled compared to the previous two months, significantly impacting operational costs [4] Business Line Data and Key Metrics Changes - The company has suspended flights to the Middle East, specifically Dubai and Riyadh, and is reallocating that capacity to other popular routes, such as London and Zurich [6] - HK Express is set to receive five new narrow-body aircraft this year, with no major delays expected in fleet delivery [9] Market Data and Key Metrics Changes - Demand for flights to Europe has surged due to reduced operations from Middle Eastern carriers, with similar trends observed in long-haul flights to the U.S. and Australia [15][17] - The cargo yield has been normalizing over the past few years, with no significant short-term impact from the Middle East situation on cargo operations [20] Company Strategy and Development Direction - The company is implementing a fuel surcharge mechanism to mitigate the impact of rising fuel costs, with plans to increase surcharges for both travel and cargo [4] - HK Express differentiates itself through high on-time performance and a strong brand presence in the Greater Bay Area, capturing a significant portion of revenue from mainland cities [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed hope for a peaceful resolution to the current conflict affecting fuel prices and operational stability [4] - The company is adapting to dynamic market conditions, adjusting pricing based on supply and demand while monitoring competitor actions [5] Other Important Information - The company has hedged 30% of its fuel for 2026, focusing on crude oil rather than crack spreads [4] - The operational environment remains volatile, with ongoing adjustments to flight schedules and capacity deployment [5] Q&A Session Summary Question: What drives the projected 10% capacity growth? - Management indicated that the delivery of new aircraft and month-on-month growth leading up to December will contribute to this capacity increase [3] Question: How will the company address higher fuel costs? - The company plans to increase fuel surcharges and adjust ticket prices based on market conditions [4][5] Question: How is capacity from canceled Middle East flights being deployed? - The company is reallocating capacity to other routes, particularly increasing flights to London and upgrading aircraft for Zurich [6] Question: Are there any delays in fleet delivery for HK Express? - Management confirmed that there are no major delays expected in fleet delivery, with new aircraft arriving on schedule [9] Question: How does HK Express differentiate itself from other low-cost carriers? - HK Express focuses on on-time performance and brand strength, leveraging its position in the Greater Bay Area to capture market share [11][12] Question: What is the demand outlook for Cathay Pacific post-Middle East tensions? - There has been a short-term surge in demand for long-haul flights, particularly to Europe and the U.S., due to changes in travel patterns [15][17]

Financial Data and Key Metrics Changes - The company is projecting a 10% year-on-year growth in passenger capacity for 2026, despite a fleet growth of only 4% in passenger aircraft [3] - Jet fuel prices have almost doubled compared to the previous two months, significantly impacting operational costs [4] Business Line Data and Key Metrics Changes - The company is currently flying to two destinations in the Middle East, with plans to suspend flights until the end of March, reallocating capacity to other popular routes such as London and Zurich [6] - HK Express is set to receive five new narrow-body aircraft this year, with no major delays expected in fleet delivery [9] Market Data and Key Metrics Changes - Demand for long-haul flights, particularly to Europe and the U.S., has surged due to reduced operations from Middle Eastern carriers [15][17] - The Australian market has also seen increased demand as travelers reroute through Hong Kong instead of the Middle East [18] Company Strategy and Development Direction - The company is implementing a fuel surcharge mechanism to mitigate the impact of rising fuel costs, with plans to announce increases for both travel and cargo [4] - HK Express differentiates itself through high on-time performance and a strong brand presence in Hong Kong and the Greater Bay Area, capturing a significant portion of revenue from mainland cities [11][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the volatility in supply and demand due to the Middle East situation and is adapting pricing strategies accordingly [5] - The cargo yield has been normalizing, but the company has not seen a major impact from the Middle Eastern disruptions on its cargo operations [20] Other Important Information - The company has hedged 30% of its fuel for 2026, focusing on crude oil rather than crack spreads [4] - The company is actively monitoring competition and market dynamics to adjust its strategies [5] Q&A Session Summary Question: What drives the projected 10% capacity growth? - Management explained that the delivery of new aircraft and month-on-month growth leading up to December will contribute to this capacity increase [3] Question: How will the company address higher fuel costs? - Management confirmed that fare adjustments and increased fuel surcharges are being considered to mitigate rising fuel prices [2][4] Question: How is capacity from canceled Middle East flights being deployed? - Management stated that capacity is being redirected to other popular routes, such as London and Zurich, while flights to the Middle East are suspended [6] Question: Are there any delays in fleet delivery for HK Express? - Management indicated that there are no major delays expected in fleet delivery, with new aircraft arriving on schedule [9] Question: How does HK Express differentiate itself from other low-cost carriers? - Management highlighted their strong on-time performance and brand recognition in the Greater Bay Area as key differentiators [11][12] Question: Has passenger yield normalized since the Middle East tensions? - Management noted that while there has been a surge in demand for certain routes, it is still early to determine if yields have fully normalized [14][15]

Financial Data and Key Metrics Changes - The company achieved a record revenue of HKD 116.8 billion in 2025, marking the highest revenue in its 80-year history [27] - Consolidated profit for the year was HKD 10.8 billion, a significant increase from HKD 9.9 billion in 2024, driven by a 26% increase in capacity [28][29] - Return on Capital Employed exceeded 10% for three consecutive years, indicating strong financial performance [8] Business Line Data and Key Metrics Changes - Cathay Pacific's revenue increased by almost 16%, with capacity up by 26%, leading to a 10% decrease in yield [39] - Cathay Cargo's revenue remained stable compared to 2024, with capacity increases primarily from passenger aircraft bellies, while yields normalized [42] - HK Express experienced a capacity increase of over 30%, but revenue only grew by 7%, impacted by changing customer preferences and new destination maturity [45][46] Market Data and Key Metrics Changes - The company launched 20 new destinations in 2025, exceeding 100 destinations worldwide [10] - Load factors for Cathay Pacific improved progressively over the year, indicating better capacity utilization [40] - The cargo business saw a strong peak in Q4, despite uncertainties in global trade dynamics [44] Company Strategy and Development Direction - The company aims to sustain its success from the past three years while focusing on improving customer experience [5][9] - The strategic vision for 2026 to 2030 includes becoming the world's best premium airline and enhancing its lifestyle brand [12][13] - A significant investment of HKD 100 billion is planned for fleet modernization and product upgrades [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a 10% increase in passenger capacity for 2026, despite geopolitical challenges [51][54] - The company acknowledged ongoing supply chain challenges and the impact of the Middle East conflict on operations [52] - Management emphasized the importance of maintaining a happy team to drive customer satisfaction and profitability [6][14] Other Important Information - The company has been recognized with multiple industry awards, including being ranked among the top three airlines globally by Skytrax [10][11] - A second interim dividend of HKD 0.64 per share was announced, reflecting a policy to distribute approximately 50% of profit after tax [38] Q&A Session Summary Question: What are the expectations for passenger capacity growth in 2026? - The company expects to grow passenger capacity by around 10% in 2026, subject to geopolitical challenges [51] Question: How is the company addressing fuel cost fluctuations? - The company has hedged about 30% of its fuel for 2026, but acknowledges that jet fuel prices have significantly increased recently [30][31] Question: What is the outlook for HK Express? - Despite being loss-making in 2025, HK Express is expected to improve fundamentals and has a path to profitability [47]

Financial Data and Key Metrics Changes - In 2025, the underlying net profit increased by 5%, and the dividend per share rose by 6% to HKD 1.32, reflecting a year-on-year increase of 10% in the second half [4][9] - Net debt decreased to HKD 32 billion, with gearing reaching a new low of 17.2%, leading to a significant decline in interest costs [4][9] - NAV per share was HKD 59.85 at year-end, representing a mild drop of 3% [5] Business Line Data and Key Metrics Changes - The investment properties portfolio maintained an overall occupancy rate of 92%, with retail revenue at Harbour City growing by 2% despite challenges [5][7] - Office revenue increased by 1% due to improved occupancy, although negative rental reversion persisted [8][9] - The hotel sector saw improved revenue and occupancy, driven by a vibrant inbound tourism market, although average room rates were below expectations [11][12] Market Data and Key Metrics Changes - Hong Kong's retail sales grew by 5% in the second half of the year, indicating a potential new base for recovery, primarily driven by discretionary spending [6][7] - Inbound tourism increased by 12%, with a more diversified mix of visitors contributing to retail sales turning positive [5] - The overall consumption recovery remained uneven, posing challenges for landlords and the retail sector [6] Company Strategy and Development Direction - The company aims to maintain low leverage and a healthy financial position while navigating ongoing market disruptions [14][15] - Incremental improvements are planned for Times Square to enhance competitiveness without significant capital expenditure [27] - The company is focused on retaining tenants through flexible leasing strategies and enhancing the quality of its properties [31][32] Management's Comments on Operating Environment and Future Outlook - The management highlighted significant global disruptions, including geopolitical tensions and rapid technological changes, impacting the business environment [13][14] - Despite signs of economic recovery in Hong Kong, the outlook remains mixed due to external risks and challenges in the investment properties sector [14][15] - The management remains vigilant regarding interest rate fluctuations and plans to continue deleveraging to maintain financial flexibility [9][46] Other Important Information - The company achieved strong ratings and green building certifications, with 37% of financing being sustainable as of December last year [12] - The management is exploring the impact of AI on property management and marketing, although it remains cautious about switching investments from properties to tech stocks [55][60] Q&A Session Summary Question: Retail sales sentiment and expectations for 2026 - Management noted that retail sales in Hong Kong started to pick up in mid-2025, with early numbers from January indicating continued strength [17][18] Question: Details on HKD 1 billion capital commitment - The capital expenditure primarily focuses on upgrading older office spaces to regain competitiveness [22] Question: Magnitude of negative rental reversion - Management indicated single-digit negative rental reversion overall, with expectations that it may not improve significantly in 2026 [26] Question: Plans for Times Square - Incremental improvements will be made to Times Square, with no grand plans for extensive redevelopment [27] Question: Strategy for Harbour City amid competition - The company aims to retain flagship brands and enhance tenant performance through marketing efforts [32] Question: Interest cost management and hedging policy - The company plans to maintain a floating interest rate strategy, with no current plans to switch to fixed rates [59] Question: Repositioning of high-end retailers - Management emphasized the importance of retaining flagship stores and collaborating with brands for expansion [66]

Financial Data and Key Metrics Changes - In 2025, the underlying net profit increased by 5%, and the dividend per share rose by 6% to HKD 1.32, reflecting a year-on-year increase of 10% in the second half [4][9] - Net debt decreased to HKD 32 billion, with gearing reaching a new low of 17.2%, leading to a significant decline in interest costs [4][9] - NAV per share was HKD 59.85 at year-end, representing a mild drop of 3% [5] Business Line Data and Key Metrics Changes - The Hong Kong investment properties and hotel underlying net profit increased by 7%, primarily due to a reduction in borrowing costs exceeding mild declines in revenue and operating profit [9] - Retail revenue at Harbour City grew by 2%, while office revenue increased by 1% due to improved occupancy, despite negative rental reversion [7][10] - The overall occupancy rate for the investment properties portfolio remained resilient at 92% [5] Market Data and Key Metrics Changes - Hong Kong's retail sales grew by 5% in the second half of the year, indicating a potential new base for the market [6] - Inbound tourism saw a 12% increase in visitors, contributing positively to retail sales, which turned positive in May with a 1% increase [5] - The office market maintained an occupancy rate of over 90%, outperforming the market despite downward pressure on rental rates [7] Company Strategy and Development Direction - The company aims to maintain low leverage and a healthy financial position while navigating ongoing market challenges [15] - There is a focus on enhancing the quality and appeal of office spaces through ongoing upgrades to remain competitive amid new supply [8][22] - The company is committed to sustainability, with 37% of financing being sustainable as of December last year [12] Management's Comments on Operating Environment and Future Outlook - The management highlighted significant global disruptions, including geopolitical tensions and rapid technological changes, impacting the business environment [13][14] - Despite signs of economic recovery in Hong Kong, the outlook remains mixed due to external risks and challenges in the investment properties sector [14][15] - The management remains cautious about the retail market, noting that recovery is uneven and dependent on various factors, including consumer confidence and sector performance [19] Other Important Information - The company has received strong ratings and green building certifications, including LEED Platinum for Times Square and Harbour City's offices [12] - The hotel sector showed improvement in revenue and occupancy, although average room rates were below expectations due to price sensitivity among customers [11] Q&A Session All Questions and Answers Question: Retail sales sentiment and expectations for 2026 - Management noted that retail sales in Hong Kong started to pick up in the middle of last year, with early numbers from January indicating continued strength [17] - The management expressed hope for gradual improvement in retail sales, but acknowledged ongoing uncertainties [18] Question: Details on HKD 1 billion capital commitment for Hong Kong IP - The capital expenditure primarily focuses on upgrading older office spaces to regain competitiveness [21][22] Question: Magnitude of negative rental reversion and plans for Times Square - Management indicated that negative rental reversion is in the single digits and emphasized the need for leasing flexibility to maintain occupancy [26][27] Question: Strategy for Harbour City amid increasing competition - The management highlighted the importance of retaining flagship stores and maintaining competitive advantages through marketing and tenant support [32][65] Question: Impact of AI on property management - AI is expected to enhance property management efficiency and service quality, although the full benefits are still being assessed [54]

Financial Data and Key Metrics Changes - In 2025, the underlying net profit increased by 5%, and the dividend per share rose by 6% to HKD 1.32, reflecting a year-on-year increase of 10% in the second half [4][9] - Net debt decreased to HKD 32 billion, with gearing reaching a new low of 17.2%, leading to a significant decline in interest costs [4][9] - NAV per share was HKD 59.85 at year-end, representing a mild drop of 3% [5] Business Line Data and Key Metrics Changes - The Hong Kong investment properties and hotel underlying net profit increased by 7%, primarily due to a reduction in borrowing costs exceeding declines in revenue and operating profit [9] - Harbour City accounted for around 80% of Hong Kong IP revenue, with retail revenue stable at HKD 5 billion and office revenue rising with occupancy at 91% [10][11] - Retail revenue at Harbour City grew by 2%, while office revenue increased by 1% despite negative rental reversion [6][8] Market Data and Key Metrics Changes - Hong Kong's retail sales grew by 5% in the second half of the year, indicating a potential new base for the market [6] - Inbound tourism increased by 12%, with a more diverse mix of visitors, contributing positively to retail sales, which turned positive in May with a 1% increase [5] - The overall consumption recovery remains uneven, posing challenges for landlords and the retail sector [6] Company Strategy and Development Direction - The company aims to maintain low leverage and a healthy financial position while preparing to navigate ongoing market headwinds [14] - Incremental improvements are planned for Times Square to enhance competitiveness without significant capital expenditure [26] - The company is focused on retaining flagship tenants and enhancing tenant performance through marketing strategies [31] Management's Comments on Operating Environment and Future Outlook - The management highlighted significant global disruptions, including geopolitical tensions and rapid technological changes, impacting market stability [13] - Despite signs of economic recovery in Hong Kong, the outlook remains mixed due to external risks and challenges in the investment properties sector [14] - The management remains cautious about the retail market, expecting a gradual recovery rather than a rapid rebound [17] Other Important Information - The company has received strong ratings and green building certifications, with 37% of financing being sustainable as of December last year [12] - The hotel sector showed improvement in revenue and occupancy, although average room rates were below expectations due to price sensitivity among customers [11] Q&A Session All Questions and Answers Question: Retail sales sentiment and expectations for 2026 - Retail sales in Hong Kong started to pick up in the middle of last year, with January showing strength, but the recovery remains uneven [16][18] Question: Details on HKD 1 billion capital commitment for Hong Kong IP - The capital expenditure primarily focuses on upgrading older office spaces to regain competitiveness [20] Question: Magnitude of negative rental reversion and expectations for 2026 - Negative rental reversion is in single digits, and improvements are not expected this year [25] Question: Plans for Times Square amid competition - Incremental improvements will be made to Times Square without a grand plan for extensive redevelopment [26] Question: Strategy for Harbour City amid new competition - The company will maintain flexibility with tenants and focus on retaining flagship stores [29] Question: Impact of AI on property management - AI is being gradually introduced to improve property management efficiency and service [53] Question: Interest cost management and hedging policy - The company prefers floating rates and does not plan to switch significantly to fixed rates in the near future [58]

Financial Data and Key Metrics Changes - The Prada Group reported net revenues of EUR 5.7 billion, an increase of 9% compared to fiscal year 2024 at constant FX, and an organic growth of 8% year-over-year, marking the fifth consecutive year of growth at the group level [20][21] - Retail sales totaled EUR 5.1 billion, up 8% organically versus fiscal year 2024, and up 28% versus fiscal year 2023 at constant FX [21] - EBIT adjusted reached EUR 1.32 billion with a margin of 23.2%, including the dilutive impact of Versace [21][27] - Net income increased by 2% to EUR 852 million compared to fiscal year 2024 [27] Business Line Data and Key Metrics Changes - Prada brand closed the year at -1%, with Q4 showing sequential improvement, particularly in Mainland China, Korea, Japan, and the Americas [24] - Miu Miu retail sales grew by 35% to EUR 1.6 billion, with Q4 sales up by 20% against a high base of +84% in 2024 [25] - Church's brand continued to show positive trajectory driven by like-for-like sales [25] Market Data and Key Metrics Changes - Asia Pacific region grew by 11%, with Q4 performance in line with Q3 despite higher comps [26] - Europe saw a 5% increase over the year, with softer trends in the second half due to strong multi-year comps and lower tourism [26] - The Americas experienced consistent double-digit growth, with sales up 18% [26] - Japan delivered growth of 3%, with improvements in Q4 driven by local demand and increased traveler flows [26] Company Strategy and Development Direction - The company is focused on enhancing product intrinsic value and upgrading digital technology and AI tools to improve customer engagement and store hospitality [6][8] - The acquisition of Versace is seen as a new chapter, with plans for channel repositioning towards quality and full-price sales [30][32] - The company aims to maintain a steady profitability while investing in strategic areas such as digital evolution and retail enhancements [8][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging environment in 2025 but expressed confidence in the company's ability to navigate through it, expecting solid performance in 2026 [4][10] - The company anticipates a normalization of growth, particularly for Miu Miu, with expectations of single-digit growth in the first half of 2026 [10][38] - Management highlighted the importance of agility and efficiency in the current market landscape [41] Other Important Information - The company completed the acquisition of Versace on December 2, 2025, consolidating one month of contribution from the brand into its financials [20] - The gross margin reached 80.3%, up by 50 basis points, driven by operating leverage and channel mix [27] - The board proposed a dividend per share of EUR 0.166, maintaining a stable payout ratio of 50% [29] Q&A Session Summary Question: Expectations for Prada's growth in 2026 - Management refrained from providing specific guidance but indicated that if conditions are favorable, double-digit growth for Miu Miu is possible [46][48] Question: Versace's team and store rationalization - The team is a mix of internal and external hires, with a focus on full-price retail and rationalization of the outlet channel [51][52] Question: Revenue contraction for Versace - Expected store closures and rationalization will contribute to a mid-single-digit contraction in revenue for Versace [58][60] Question: Middle East exposure and store operations - The situation in the Middle East is evolving, with varying conditions across different countries [64] Question: Prada brand cluster trends - Significant improvement in the Chinese cluster, while European demand remained resilient [87] Question: Miu Miu's growth expectations - Cautious assumptions for growth in H1, with potential for positive surprises [90] Question: Versace's margin improvement timeline - Management believes that improvements can start to be seen from 2027, with a focus on synergies and efficiencies [96]

Financial Data and Key Metrics Changes - The Prada Group reported net revenues of EUR 5.7 billion, an increase of 9% compared to fiscal year 2024 at constant FX, and an organic growth of 8% year-over-year, marking the fifth consecutive year of growth at the group level [21][22] - Retail sales totaled EUR 5.1 billion, up 8% organically versus fiscal year 2024, and up 28% versus fiscal year 2023 at constant FX [22] - EBIT adjusted reached EUR 1.32 billion with a margin of 23.2%, including the dilutive impact of Versace [22][28] - Net income increased by 2% to EUR 852 million compared to fiscal year 2024 [28] Business Line Data and Key Metrics Changes - Prada brand closed the year at -1%, with Q4 showing sequential improvement, particularly in Mainland China, Korea, Japan, and the Americas [25] - Miu Miu retail sales grew by 35% to EUR 1.6 billion, with Q4 sales up by 20% against a high base of +84% in 2024 [26] - Church's brand maintained a positive trajectory driven by like-for-like sales [26] Market Data and Key Metrics Changes - Asia Pacific region showed growth of 11%, with Q4 performance in line with Q3 despite higher comps [27] - Europe experienced a 5% growth over the year, with softer trends in the second half due to strong multi-year comps and lower tourism [27] - The Americas saw consistent double-digit growth, with sales up 18% [27] - Japan delivered growth of 3%, with improvements in Q4 driven by local demand and increased traveler flows [27] Company Strategy and Development Direction - The company is focused on enhancing digital capabilities and hospitality standards, investing in strategic digital plans and AI tools [6][8] - The acquisition of Versace is seen as a new chapter, with plans for channel repositioning towards quality and full-price sales [32][34] - The company aims to maintain a strong relationship with clients and improve retail execution while navigating the challenges of the current market environment [41] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging year for the industry, with a significant loss of consumer engagement over the past few years [5] - The company expects solid performance for Prada in 2026, with a cautious outlook for Miu Miu due to high comps from the previous year [10][39] - Management emphasized the importance of agility and efficiency in the current operating environment [41] Other Important Information - The company completed the acquisition of Versace on December 2, 2025, consolidating one month of contribution from the brand into its financials [21] - The gross margin reached 80.3%, up by 50 basis points, driven by operating leverage and channel mix [28] Q&A Session Summary Question: What is the expected growth for Prada in 2026? - Management refrained from providing specific guidance but indicated that if conditions are favorable, double-digit growth for Miu Miu is possible [46][48] Question: What are the expectations for the wholesale channel? - Management expects to maintain similar growth percentages as in previous years, with cautious inventory management [80] Question: Can you elaborate on the store openings and closures expected this year? - The retail network will see a balance of openings and closures, with Miu Miu expected to add 5-10 stores while Prada may close more than it opens [81] Question: What is the anticipated revenue contraction for Versace? - Management indicated a mid-single-digit contraction at constant FX for Versace, with efforts to limit operating losses to a two-digit figure [60][61] Question: When will Pieter Mulier present his first collection for Versace? - The first show of Pieter Mulier is expected at the beginning of next year, with changes to the collection anticipated thereafter [102]