Good morning, everybody. I think we will make a start. I've got the pleasure of welcoming Emmanuel Babeau, CFO of Philip Morris International to the stage this morning. I have been chatting with Emmanuel. He's been here from the start, and this is my first time interviewing him or having a chat with him.
Everything is going to be fine.
Everything is going to be fine. So but I think you would like to make some opening remarks, Emmanuel?
Yes. Sure. Thank you, Damian, for hosting us. Good morning, everybody. As always, a great pleasure to be in Paris at the beginning of June and being Parisian, but no longer living in Paris, I particularly enjoy that. So I call your attention on the forward-looking and cautionary statements as always. And as a summary and introduction, what I will say is that we are on track for another year of strong growth at the level of revenue, operating income and adjusted EPS before ForEx. That is, of course, first and foremost, boosted by the very strong growth that we experienced on our smoke-free portfolio.
All our brands are performing extremely well and strongly. We have, of course, the continuation of the growth of IQOS. You've seen that in Q1, we were close to a 10% adjusted in-market sales progression with Japan that is close to 10% growth. Europe a bit above 7% despite the fact that Europe is still impacted by the flavor ban and that will have an impact of around 1 billion stick in 2025. But we expect Europe to continue to recover gradually as we progress through 2025.
We see also for IQOS, many other growth countries, region growth relays, I would say. It comes from the Gulf countries to Indonesia to Mexico. Global travel retail is very good as well. So a number of countries where we see a lot of nice dynamism for IQOS. ZYN, of course, has been also performing very strongly in Q1, and we expect a very strong performance from ZYN in 2025. You've seen the growth in Q1 in the U.S. above 50%. What we are seeing is a combination of, first, of course, the continuation of strong traction from consumer demand.
This has been, of course, slowed down by some out-of-stock situation, as you know. But starting at the end of Q1, we started to accelerate significantly the production of ZYN. And therefore, we expect that gradually in the coming months, we are going to ease this out-of-stock situation to get to what we call the normal situation, so no longer material out-of-stock situation in the course of the third quarter. And we believe that this is going to trigger, I would say, a further acceleration of the consumer offtake, which start to be visible. It's going to take some time, but it starts to be visible in the Nielsen data for as much as they are reliable.
We are around 15%. And in the last data we are now above 20%, and it's growing. So we have this positive phenomenon. And on top of that, of course, we will have the restocking in '25 because remember, '24 has been a year with significant out-of-stock situation. A number of distributor retailers will restock. So we have the accumulation of these 2 elements, and we expect a year of strong growth for ZYN in the U.S. ZYN has also tremendous potential outside the U.S. We see clearly, beside the Nordics market, which has been traditional market for nicotine pouches, good performance in countries such as Austria, Poland, U.K., Switzerland. There is clearly here potential for ZYN in Europe. Outside Europe, we see countries such as South Africa, Pakistan, Philippines and Travel Retail, Global Travel Retail is also a very good market for ZYN. So not exhaustive here, but clearly plenty of great opportunity.
And actually, ZYN in Q1 outside U.S. and Nordics, were growing triple digits. And then concluding the family of our smoke-free product, we have VEEV, our vaping product. As you know, it is not our first priority. We are developing it more tactically, but there is a lot of traction behind VEEV. We have a very good product, and we've reached already #1 position in 5 markets in the EU and among them, significant markets such as Italy, Czech Republic or Romania and Greece. And we see here a clear play where we develop VEEV when we are able to develop this business in a profitable manner.
And that brings me to what I think should be to your understanding of what is the future about smoke-free product, which is what we call the multi-category play, which we really see as the future and a very strong driver. What does it mean? Well, it means that at the end of the day, we see increasingly our smoke-free product consumer wanting to have a repertoire of brands and wanting to be able to, some time, even if very often, they will have a core consumption, but to be able to also have different experiences, different pleasure in the way they consume nicotine.
So you could have someone who most of the time will be using IQOS. But when the person is going to be between 2 meetings, he may go with VEEV with perform demand or when he will be working very hard in the office, he has no time for a break, he will be taking a ZYN. And when we play the team together, what we are seeing and we are already with the 3 brands playing together in 16 markets, we are actually seeing that they are not cannibalizing each other, but they are actually strengthening mutually because we introduced this consumer to the family and they will build loyalty to our brand, and that's the strength, of course, of having great brand in smoke-free, and that will further accelerate our progression.
What is also super important to note is that our smoke-free portfolio is coming with superior financial metrics. You know that the revenue per unit is higher. The gross margin rate is higher as well. We've been seeing a fantastic improvement. Well, that was already a great improvement in the 2024 globally. In the first quarter of 2025, 670 basis point organic margin improvement for gross margin on smoke-free products. You have, of course, ZYN, that is the best-in-class margin for us in the U.S. coming with a strong year contribution. But IQOS as well is improving its margin because we are increasing price because we are reducing cost but also because we are more efficient on the device, which is globally improving the margin.
So that means that today, so in Q1, we had a gross margin rate of around 70%, and smoke-free products are around 5 percentage points higher than combustible product. So when we grow fast and we grow very fast on smoke-free, you've seen Q1 volume above 14%, revenue above 20% organically, gross profit, more than 30% growth, and we are improving the margin very nicely. And it is, of course, very positive to the mix.
Now next to this very strong performance on the smoke-free portfolio. We have our combustible business that is doing well. So it's true that over the last 15 months, we have even been experiencing growth in volume. Don't take that as a new normal. We believe that the market for combustible outside U.S. and China continue to be experiencing a trend of low single-digit decline. That's what we expect for '25, by the way, but we managed to increase price. We managed to work on our cost. We have a lower level of headwind on input cost. We improved the margin on CC in '24. And we also improved it in the first quarter of '25, and that bodes very well for the rest of the year.
So when you combine this very strong growth, very positively coming from smoke-free, good resilience on combustible where we are able to grow revenue, improve margin. That is allowing us to confirm the guidance for a strong growth in 2025. We are targeting an organic growth of revenue from 6% to 8% and organic OI growth, operating income from 10.5% to 12.5%. and we are targeting a growth of adjusted EPS before ForEx also of 10.5% to 12.5%. This is before ForEx.
One of our big, big ambition is to grow in dollar term, the profit of the company. Last year, in '24, the ForEx was negative, but despite that, we grew in dollar terms more than 9% the adjusted EPS. This year at the prevailing rate on the 23rd of April, the ForEx is positive. And the guidance we gave at that time was a positive $0.10 impact on the currency, and that will mean at that FX 12% to 14% growth in dollar term of the adjusted EPS. Damian, that's what I wanted to say in introduction. Thank you.
Thank you very much, Emmanuel. I think if we start back with your sort of -- you're clearly the leader in smoke-free products, and you've got the ambition of having 2/3 of revenue by 2030 coming from these products versus where you were when you set the target. What's the degree of conviction that you've got in achieving that ambition.
Well, I think that there is plenty of things clearly pointing to the fact that it is a nice ambition to have and a reasonable one. Look at the growth in '24, 17% organic growth for revenue in our smoke-free business. Q1 was north of 20%. And there is, of course, a very strong differential with combustible. So that is what is driving this ambition of going towards the 2/3. Now we know that we have the U.S. where with IQOS, we're going to further accelerate on smoke-free. And we are, of course, extremely impatient to deliver that. And there are also a number of markets which are close today to smoke-free products and some of them are very big if you look at markets such as Turkey, Brazil, Argentina, India, Vietnam.
These are markets where when they're going to open, and we believe that common sense will prevail, we're going to further accelerate, if you want, the potential for smoke-free. And that is how we see our journey toward this more than 2/3 in 2030 today.
Okay. And I think you've talked about or started to increasingly talk about the multi-category approach that you have. And I think Philip Morris is well known for IQOS and more recently ZYN to the acquisition, Swedish Match. But you've also sort of started to talk about VEEV and vape a bit more. Can you just give an example of how it works on the ground with all 3 together. And are there any good examples where you've got multi-category working well in some markets?
Sure. So the first example of that is certainly the one that illustrates the interesting of the play, but it's very specific, is Global Travel Retail. So typically, you will have duty-free space, consumer is coming, it's an Italian traveler who wants to buy his IQOS for when he's returning to Italy because, of course, he's going to get a good price for it. And then he has a long-haul flight. So you know that it's going to be 10 hours in the plane, and he entered the duty-free shop. And of course, we have a team here to introduce ZYN and say, you're an IQOS user. You're not going to be able to use it during the flight. Have you been trying ZYN and also you build the understanding of the knowledge, you ask about, okay, which kind of strength of nicotine do you enjoy, which kind of flavor, you can offer a ZYN that is going to correspond to that. And so you introduce him to a new category.
And then very often you tell, by the way, it's not for now, but if you are also sometime using vape, have you tried VEEV and you can have that. The fact that people are very often coming from 1 strong brand that they trust, that they enjoy is, of course, creating a great entry to the other because they know that these are great brands, great quality, reliable, and they know that this universe of brand, this portfolio of brand is delivering great, pleasurable moment. So there is clearly a very big strength for me in having this, what I call the dream team together and pulling the 3 brands together.
But outside Global Travel Retail, we could mention today Poland, Greece, Romania, where we see an acceleration, I mean, for instance, on VEEV but also on ZYN, that is directly coming from this multi-category play. So 16 markets, as I said, where we have today, the 3 brands, 20 where we have only 2. But the idea is everywhere we can, it's going to be to play. Of course, each brand will have a different share in each country. depending on the specifics of the country. But there is a very, very strong play coming from playing it as a team.
And given the sort of the long-term ambition for the nicotine space, everybody is sort of interested in which particular category is going to be the biggest. Do you have a particular view or is it too early to say?
Yes. I think it's very difficult to say today. I think each category has a role to play. You still have 1 billion smoker on the planet. And nothing can replicate the smoking experience better than IQOS. So it's absolutely great in terms of feeling, in terms of mimicking, repeating the experience of smoking, the very rich flavor of tobacco. So I believe that this heat-not-burn category in general and of course, IQOS owning around 75% of the category as the arch leader has a tremendous potential because this is a category that is going to clearly resonate with a billion smokers, and of course, with different products, different positioning in order to reach the maximum number of people.
Vaping has a role to play without any doubt. But as you know, Damian, we are calling for a much more responsible regulation of this category. One of the difficulty that I think smoke-free products are still facing in a number of countries is coming from the fact that vaping has been during a long period of time, the wild, wild west and a lot of people going for unacceptable commercial and marketing behavior, clearly targeting underaged people with high nicotine content to pit flavor. And if you go to lollypop flavors or bubblegum, I mean do we seriously believe that we are targeting legal age consumer? The answer is no.
Where can you sell and also on taxation because today, very often people say, "Yes, you enjoy on IQOS a significant discount in terms of excise duty versus combustible. Yes, of course, because it's much less risky than combustible. But actually, IQOS for a very similar impact in terms of exposure to toxic and versus a good vaping product because all vaping products are not good, is much more taxed today.
So I think that there should be also some reflection on, okay, what is the right positioning for tax. But vaping has a role to play. I would say for me, it's perform demand and it's for people who say, I don't necessarily love tobacco and liquid with nicotine is fine by me. And then you have nicotine pouch, which I believe has the potential to be a game changer to be very clear. Because this is a product that is, of course, going to offer to people who enjoy nicotine, a way to consume nicotine with a lot of freedom, you can consume ZYN wherever you are which is regaining the ground lost for the last 40 years on combustible cigarette. You can also enjoy your ZYN being active. So that's not by coincidence that truck driver, military forces, I mean office people, you can enjoy it indoor and you can be active doing something else, sportsman as well.
So that's a product that is just opening new movement, and I would say, unchartered territory in terms of consumption. But what we find for ZYN in the U.S., which I think is really interesting is that a lot of people consume ZYN as a lifestyle product. It's an energizer. It's a stimulant. Sometimes they see that as a supplement. Some of them even tell us, "You know what, I used to take a lot of energy drink. And today, I take less energy drink but I take ZYN as a stimulant. And when I take my ZYN, I feel sharper, less stress, more focused, better at what I'm doing, which is due to the impact of nicotine on the brand." And I think also, ZYN, because you are no longer inhaling anything is also allowing to maybe better understand what nicotine is about.
The drama of nicotine has been the entangling with combustible cigarette for 1 century. So people associate nicotine with the bad coming from the smoke that is carcinogenic and creating the disease attached with smoking. Nicotine is not without risk. It's a stimulant like caffeine. So of course, it can have like a stimulant if you have cardiovascular condition, you should not be consuming nicotine, but it's not carcinogenic. It's not function impairing, it's not intoxicating. And at the end of the day, the reason why people get addicted to it, it's because it increase the level of dopamine in your brain. That's why people feel less stress, less anxious and just more focused, sharper in their mind.
And you have studied today, not done by PMI, so we can mention it in Sweden showing, for instance, that if you've been consuming nicotine in your life, you have a lower risk to have Parkinson's disease. You have a study in the U.S. on the benefit for cognitive processes of nicotine and can it slow down the development of Alzheimer, as an example. So there is also some positive that needs to be understood on nicotine. And I think that ZYN maybe is allowing to have a more pacified debate on that because it's no longer an inhalable product. So I think all category will have a big role to play, and it's impossible to say that they will be a winner. I think all of them are going to win at the end of the day.
Just on that point around the sort of the benefits of nicotine, do you think we will ever get to a place where you can make those positive claims about the brands? Or is that too far in the future.
Well, we're a consumer good company. So we are not yet to make today a kind of claim of take that and you will have this kind of benefit. And we hear a lot of expected or believed benefit that, of course, we are not making any claim on them from many different horizon. I think we just want to make sure that nicotine is not demonized because if it is the case, that means that you have people who prefer to keep people smoking than explaining what nicotine is about and having the right tobacco harm reduction policy to bring people who are smoking towards other nicotine products that are much better than smoking.
So for me, it's not about having any kind of healthy or positive claim, but it's ensuring that we have the right debate and the right action to drive the right behavior for the positive impact on public health.
Okay. So if we sort of move into some of the new product brands that you've got, IQOS has clearly been a great success. Japan was one of the first markets it's launched into. It's now sort of over 50% share. I think you've talked about what heated tobacco does on one level, but what is it about the Japanese market that has allowed you and IQOS to sort of take such market share, do you think?
I think that -- so first of all, Japan is where we started first, more than 10 years ago now. And there was this conjunction of people open to technology innovation in Japan, which was very important. And the fact that quickly the consumer realized that with this product, they have a lower impact on their environment, and they can use it with less lower level of secondhand impact. I'm sure that this has been played.
And then I think it has been the fantastic job done by the team, where in Japan, and I don't know whether some of you have been traveling to Japan recently, but IQOS is a lifestyle brand. So we are developing IQOS, of course, for the benefit of the smokers. They know that they have this better alternative and they see their impact on their daily life. But it's not coming as a kind of, yes, it's just a product I'm using, and I have my pleasure, and that's it. It's really entering into that's part of my life. It's related with sometimes my passions, what I love. We connect the brand with cuisine, with decoration, with design, with fashion. And I think it's really entering a lifestyle. And that's, I think, a big reason for the strong success of the brand.
And I think it's also because we kept innovating on the product, so several generation of device. We've been innovating a lot on the consumable as well. And gradually, we convinced even the most entrenched smokers that IQOS is for them as well. I was in Japan not that long ago when we had some customer interview. And for the first time, there was a number of people significantly above 50, still very young, but above 50. And they were saying during a long period of time, I thought IQOS was for the young adults. It was not for me. But now I feel proximity with the brand, and I believe, yes, it's for me as well, and I understand the benefit of it. So I think this is the kind of thing that is happening in Japan and explain the success.
So if we then look at one of the markets where you're kind of only really just touching the surface in the U.S. Can you sort of give us an update on where you are currently with the regulatory process? And also, you've recently expanded into a second city running the trials. Are there any insights that you've sort of gained from Texas or Florida yet that give you conviction?
Sure, Damian. Look, so far, to test. So of course, let's be cautious, but everything we've been seeing both in Austin and in Florida, where we're doing the second pilot in Fort Lauderdale is the confirmation of the fact that you still have almost 30 million smokers in the U.S. and they are not all in rural traditional area. You have a lot of people living in the big cities, open to innovation. By the way, the U.S. consumer love new things. They love new trends who love things that are different, new, sophisticated. And I think the 2 tests are confirming that IQOS resonate with these people. So they love the ritual, they love the look and feel. They rapidly see the difference versus smoking and what they can feel with IQOS in terms of no longer smelling tobacco.
You know that to feel the impact on the way you breathe, it's very short. I mean, in a few weeks, you're going to feel the big difference between smoking and IQOS. And therefore, when you put all that together, yes, you have the ingredient of a brand that is creating trend that is, again, beginning of a connection with lifestyle. So this population of people who are from various community in the U.S., okay? So clearly, there is not one community that we believe will be more quickly adopting. But we clearly see that strong resonance in the cities people with certain purchasing power, of course. And again, I think that this test for new things, innovation and the capacity that we will have in most states in the U.S. to communicate, we believe, are the ingredient for success for IQOS in the U.S.
Okay. And then so sticking with the U.S., ZYN has been a huge source of excitement for lots of people. You're starting to see capacity sort of recover when you recently upgraded that outlook for this year. Can you sort of just talk about where you are in the journey of getting capacity back to where you'd like it to be? And perhaps the new capacity that's coming on stream next year.
Sure. So quite a while ago, we said that we would be having around 900 million can capacity for the year. I think if anything, we have some good news of anticipation of putting in place some new capacity at the end of Q1. So we did not revise the expectation for the year. But that means that we believe that we have for the whole '25 what we need to deliver our guidance. But then, of course, in terms of putting an end to the out-of-stock situation, it takes some time.
Remember, we start to ship first our product to wholesaler and distributor. And then themselves, they're going to ship the ZYN can to more than 200,000 sales points. So that takes time to really feed the whole pipe. So that's a gradual process that will take a few months. We said that in Q3, we should be back to normal and we expect to see already some of that materializing in Q2, but it's going to be very, very gradual. But people should expect, therefore, for '25 to have, again, the combination of consumer offtake growth and we'll have on top of that the restocking, which will make '25 relatively special year, I would say.
Yes. And in terms of -- there's quite a lot of competition coming into the category in the U.S. How do you see the category evolving from a competitive point of view?
So you're right, Damian, there is a lot of competition, but I think you should expect that talking about the competition category that, sorry, has already a multibillion dollar value, growing still around 30%. So everybody wants to take piece of the cake, as you would imagine. And that is driving a lot of behaviors.
I'm not here to say which brand are I would say, legal or according to regulation in the market, I think a lot of people are trying to play with the regulation. We are still today the only brand with PMTAs for all our range actually. But of course, many other people are here. And what we can see is that in order to try to grab part of the cake, everybody is incredibly aggressive on price. So discounting across the board is the name of the game for everyone.
So because of scarcity for us, we've seen actually our average retail sales point above what we think is normal because we had some distributor who took benefit of the out-of-stock situation. But let's say, a can of ZYN in the U.S. today should be on average around $6 in the U.S. Most of the competitor is around $4, if not below, and all the big names that you have in mind, you're going to find them at 3 for $6 too. You buy them in promotion at $2 for a can.
So that's -- and you have many competitors doing that, to be very clear. So that's what is happening today. And that means that we've been creating because maybe apart from Rogue that is a bit closer to us. But we are the only one with our price positioning and the rest of the competition is very low. So we clearly have been setting the bar high. We are the leader in term of market share. We are the leader in terms of image, premium mass. And of course, there is a whole pop culture that is developing around ZYN and at the same time, receiving the PMTAs for -- by the FDA for the full ZYN range, which, as you have been noting, not only include mint, menthol product, but also lemon, citrus, cinnamon and coffee.
When on vaping, the FDA has not been giving apart from 1 reference, any flavor product. So it's a recognition by the FDA that they believe that we are marketing our product in a very responsible manner. I think the strength of the can is also important, 3 and 6 milligram. You could expect maybe the FDA to look at what is the maximum nicotine content that is acceptable. So I think it's still a landscape that has to evolve, but we are between our leadership, the PMTA that we have, quite ahead of the competition.
And I think you mentioned in your comments that sort of you think that the category or the pouches can be a game changer. There's been some debate about how easy the consumer transitions into pouches where there isn't a traditional use of all nicotine. What's the experience of ZYN in those markets where there hasn't been a...
Look, I think you're right. It is obvious that Nordics, U.S., you have this traditional of oral product, and that makes the growth of the nicotine pouch category faster at the beginning. But let's be clear, we are today in a world that is still largely global. So people see the trend developing. ZYN, which was outside U.S. and Nordic, not really a brand. I mean, we've seen when we have launched in the U.K. that there was already a pretty nice franchise being the brand, which is just coming from the U.S., to be very clear, due to the connection.
And I believe that the legal edge adult until 39, which maybe are the one who are going to look at this product first. I think they're going to learn fast. They're going to see rapidly friends coming from other countries using it. So yes, it's going to take a bit more time, but the product is so convenient, so different and again, probably quite different or additional in what it brings to the consumer that I don't think that we're going to need years and years to see some nice growth and the category becoming also a material one in many countries.
If we switch to the sort of the combustible side of the business. Now I think you mentioned in your opening remarks that you've had some decent volume growth over the last couple of quarters, but we shouldn't expect that to continue. Can you just sort of provide a little bit of color around what's contributed to that growth recently and why we shouldn't be expecting that to continue?
Sure. So the fact that during 15 months, we've been growing volume in the combustible is due to several factors. First of all, you had a number of countries with positive demographics. Sometimes we've seen from Western country, it's difficult to see that. But you have actually legal age 29 population, growing pretty fast. So you have potentially new nicotine users. And in many of these countries, you have a ban on smoke-free product. So this young legal age adult, the only option is to go for smoking, and that is triggering -- I mean, that's what we see in Turkey, in India, in Vietnam, that is triggering a growth in the smoking consumption. So that's one element, and that can be significant on volume.
Second, you had a market that have been disrupted, and we very nicely benefited from that. And I'm thinking about Egypt, notably where the big local producer because the economic turmoil has been limited in its capacity to produce. So we've been increasing in a big market in terms of combustible, our market share, and we're going to go down to a normal situation gradually because the local player is gradually also going back to normal in terms of capacity of production.
And then the geopolitical situation has also been playing because when you have war conflict, issues between country, you have the borders being closed. And you see then the illicit trade decreasing. And this is, of course, favorable for the legal real product trade, and we've been benefiting from that. I think this one as well, it's a one-off effect. It's not contributing every year. So you have a positive contribution. And then, of course, you lose that. So I think gradually, we're going to be back to the normal trend again of the combustible business, which is low single digit. And we actually believe that is going to be the case for us in '25.
I think you sort of made a very strong reduction in gearing last year, I know you did, but you said not to expect the sort of the same level of sort of de-gearing this year. Can you just sort of talk about the pace of de-gearing towards 2026 and then capital allocation plans after that when you get to sort of your target.
Sure. So as you know, Damian, we have the objective to be around 2x at the end of 2026 of net debt to EBITDA. We are on track for this objective. We signaled that in '25, after a very strong deleveraging, you're right, in '24. I mean today, but it depends -- it's very volatile because it depends on the currency. We're not necessarily expecting the same kind of speed of deleveraging, but we expect some deleveraging. And we believe that we are on track towards this around 2x for 2026.
What we said is that once we are there, or that we see that we are clearly going to get there, the topic of the buyback will be rediscussed with the Board that only once we are there, I think that before this question of the buyback, if the ForEx stay where it is today, which means that not only are we growing fast before ForEx, but ForEx is even adding, potentially some extra growth. I think the question will be the speed of the growth of the dividend. You know that we have a policy on dividend, which is very clear. It's progressive. There is only one way for the dividend that is up. It is true that in the past years, because we're investing and because ForEx was most of the time negative, we've been growing dividend but at a more reduced pace. It was 3.8%, I think about that in the last increase of dividend. I think the Board will say, okay, what does it mean for the dividend progression to have such a strong growth on the adjusted EPS?
Yes. I mean my last topic of conversation probably could take the entire duration. So I'm conscious we've only got a few minutes left. But on regulation, clearly, there's a heterogeneous approach to regulation, and you've touched on some of those markets, where sort of next are banned. Where do you see good progress in terms of regulation? And where is it you sort of think other things could be improved.
Look, let's start with the positive. You have many countries and many important countries that are firmly engaged on tobacco harm reduction. I mean the U.S., okay, FDA has been too slow and is too slow in granting the PMTA, but they have a very clear and neat strategy to go for tobacco harm reduction, say, yes, we need to promote this product, and they have this mechanism between PMTA and MRTP. But they have, of course, some frame in which they want to put that.
Now if they can accelerate to clarify the landscape that would be good, but they have a plan. Many European markets have a plan. I mean if you look at Italy, Greece, Czech Republic. I mean, you're going to find many countries put tobacco harm reduction sometime in the law as a big objective for their public health policy. Outside Europe, you're going to find Philippines, you're going to find markets such as New Zealand, among many other once again, who are also firmly engaged on that front. So there is a lot of things going in the right direction.
Now unfortunately, it's true that it's not the case everywhere. And you still have a number of NGOs, organizations such as WHO that are more obsessed by sometime underage protection than by pushing smoker to go to a smoke-free product. And we believe that it is perfectly doable to do both, to protect and really have a very strong policy to avoid underage consumption but clearly oriented 1 billion smoker towards better product. And I think today, this obscurantism, the fact that they don't want to look at science, the fact that they are more in dogma than in really looking at science on fact and being pragmatic is terrible for hundreds of millions of smokers.
So hopefully, things are going to continue to progress. But certainly, and I mentioned all the bans that we are still facing in a number of countries. It's not going as fast as we would like and as it could.
And on that sort of the U.S. has sort of been a hot topic of debate in terms of changing sort of government changes at the FDA. Have you seen anything that gives you sort of encouragement from what either the new government or the incoming sort of ahead of the CTP has said?
So you said it. Damian, there is a new head of the CTP, his name is Bret Koplow. He is not a newcomer, 20 years at the FDA from what I have been told. So he's not starting from a blank page where you would have to redefine everything. I think he has been participating to the work already. So for the time being, he's acting as director. So I think it will need to be confirmed. But if you read of some of the things that he may have been saying and so on, I mean, it gives a feeling that it's about pushing tobacco harm reduction, ensuring the smoker understand the benefit of a better product versus combustible and also, of course, fighting very, very fiercely against underage. So I mean he needs to come with certainly his view and the road map. But the good thing is that it's not someone coming and we will need months to understand what the tobacco space is about and what should be the policy.
Well, I think with that sort of hopefully positive outlook for regulation in general, but the U.S. in particular, we'll leave it there. Thank you very much, everybody.
Thank you everybody. Thank you, Damian. Thank you very much.
