“We knew that inflation would still be there for the rest of the year, although in the second part of the year, we are going to be facing comparison where inflation was starting to kick in, so that's going to have some impact.”

In context

“nge in the trajectory and on which we have visibility for the second half on things where we have postponement of things with good news, but of course we still a lot of uncertainty on H2. Of course, we have to be a bit more cautious when we take them in the scenarios. Pamela Kaufman: Okay, thanks. And then just on operating margins, you pointed to operating margins closer to the lower end of your initial guidance range of down 50 to 150 basis points for the year. Can you discuss the puts and takes impacting your margin performance in the second half? Emmanuel Babeau: Sure. When you look at the margin, really things are happening as expected, I would say. So, after Q1, which was not coming as a surprise to us, we said from now on, we're going to see an improvement of the margin trajectory. We knew that inflation would still be there for the rest of the year, although in the second part of the year, we are going to be facing comparison where inflation was starting to kick in, so that's going to have some impact. But we knew that a number of other headwinds would start to abate, and here I'm talking about the disruption on the supply chain and among other things, things connected with air freight, the cost attached to the launch of ILUMA, and the fact that not everything was optimal. So, we started to see improvement in Q2 as expected, and we're going to continue to see improvement in the rest of the year. And then what we see playing in Q2 that we expect to see playing in the rest of the year are the fundamental positive drivers that we have for our margin. First of all, the fact that IQOS growth is having a positive impact on our margin. We said it in the beginning, we expect a positive contribution on margin evolution for the year from the IQOS business. Remember, we have a higher gross margin”