THE NEW LOOP OPENS IN T1, DUBLIN AIRPORT ARI OPENS IN NEW ZEALAND WHAT’S BEEN HAPPENING ARI NEW OPERATING MODEL A DAY IN THE LIFEColin Morgan FOCUS ON NORTH AMERICA BUSINESS UPDATE Financial, ARI Ireland, ARI North America & ARI Middle East
ISSUE 2 Summer 2015
ARI UNVEILS STUNNING €8M RETAIL DEVELOPMENT IN T1, DUBLIN AIRPORT In March 2015, ARI opened a stunning new ‘walkthrough” retail arena in T1, Dublin Airport. A first class design featuring world exclusives, innovative retail concepts and an expanded range in all categories. The Loop in T1 is set to transform the customer experience in Dublin.
ARI is renowned for delivering a bespoke retail offering that celebrates and delivers a real sense of place. The design for The Loop in T1 remains true to this with Irish design at the forefront of the new retail space and present in every aspect of the newly developed Loop. For example, award -winning Irish artist Shane Holland was commissioned to design a unique copper sculpture that takes pride of place in the new Irish Whiskey Collection and our product range features more than 330 Irish produced goods.
The state-of-the-art retail environment is the culmination of an €8m million investment and 18 months of construction. It marks a step change in the overall passenger shopping and dining experience which now covers an area of 8,673sqm, of which 1,787 sqm is core duty free.
The Irish Memories souvenir concept has been rebranded by drawing on a more contemporary theme and commissioning exclusive new ranges that will set it apart from its domestic competitors. Features such as iconic Irish street furniture, a traditional phone box perfect for selfies and a fully restored old post box will deliver retail theatre and an authentic customer experience.
“The Loop in T1 will not only raise the bar amongst our European peer group but in fact many of our global counterparts,” said ARI Global Buying & Merchandising Director, Paul Neeson. “We are hugely confident that it will not only maximise revenue with a projected uplift of 16% in PAS but also customer satisfaction to deliver ARI’s vision of an outstanding shopping experience every time.”
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ARI OPENS IN NEW ZEALAND February 20th was a good day for ARI. It was the day that Auckland International Airport confirmed ARI as one of the selected concessionaires for its Duty Free operations for a seven year period starting on 1st July 2015. The challenge was that it gave ARI only 130 days to set up a new company, recruit and train staff, get stock to Auckland, take over the outgoing duty free operators (DFS) premises and convert them to The Loop Duty Free and build one new store 11,000 miles and 12 time zones away! The best news of all is that on 29th June 2015 ARI Auckland Limited trading as The Loop Duty Free began serving customers at 04:30 on the morning!
head up the IT function. An implementation team headed by daa’s Andrew Baker supported by Cyprus Duty Free’s Toni McDonald and Katie Chubb from ARI’s marketing team, soon formed the basis of the long-term Auckland implementation team. By the beginning of April the core team was living and working at the Sudima Airport hotel on the airport campus. Away from Auckland John Healy, Sue Kelly and Ross McMahon worked hard to secure exclusive supply agreements from duty free vendors.
On the 7th April John Ryan became ARI Auckland’s first recruit and joined the company as Head of HR. Others joined the team in early May and by the middle of May the team was able to move out of the hotel office and relocate to its new offices on the airport campus. ABOVE: Sarah Donnell - HR Specialist, Jenny Davies - Departures Sales Manager, Rob Reynolds (daa) - Logistics Manager, Katie Chubb (ARI) - Marketing Manager, Hadleigh Galt - Head of Operations, Toni McDonald (CTC-ARI) Operations Manager, Tim Fulton – Category Manager, Elena Baker – Retail Manager’ Philip Eckles (ARI) – Implementation Director, Aleah Burns – Category Manager, Tim O’Donovan (ARI) – Design & Project Management, Ross McMahon (ARI) – Project Category Manager, Jacqui Davies – Head of Procurement.
The following six weeks saw a huge amount of activity from the team on the ground in Auckland supported by every part of the company in Dublin and Shannon and a number of ARI’s overseas locations. At 03:00 27th June an empty departure store was handed over to ARI with the arrivals store being handed over at 06:00. Teams worked around the clock for the next 48 hours, firstly to clean and then to transform the shop into The Loop Duty Free and finally to merchandise the stores and setup the cash registers ready for trading. At 04:00 29th of June the transition team had finished the job and were joined in store by senior members of the local Maori community for a special blessing ceremony to ward off evil spirits and to welcome ARI to the airport community. The Loop Duty Free started trading at 04:30 that morning.
ARI began its mobilisation process at the start of March when Antoinette Quinn, Gerry Crawford and Tim O’Donovan first travelled to Auckland to begin the setup process. Antoinette held a number of ARI recruitment roadshows which facilitated a large number of potential candidates from the outgoing operators existing workforce to experience ARI first hand and to learn about our company and values. Gerry set about identifying resources and services to establish ARI Auckland Limited and Tim began the planning process of converting the old DFS shops in to The Loop Duty Free stores. Over the coming weeks work stream leads visited Auckland to look at specific areas of the business including Noel Ryan to establish the 3PL logistics solution and Nigel Bradish to
In the few weeks since the stores opened most of the implementation team have returned to their home locations to resume their usual roles. They’ve left behind a fantastic operation that has been given the best possible start and has been left in the hands of the newest members of the ARI family. Since the opening, a brand new last minute pier store has opened and ARI has launched the ariauckland.co.nz website. Further developments will happen over the coming months with the redevelopment of both the Arrivals and Departures stores and in the longer term a brand new departure store in new areas of the airport in 18 months’ time. More news from Auckland over the coming months.
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ISSUE 2 Summer 2015
n e e b s ’ t Wha ing n e p p a h
ARI Star Award — Employee of the Year Mrs Nivine Fahmi from Montreal was awarded ARI’s overall Star of The Year at a ceremony in Dublin in March of this year. Mr Redha A. Hasan Mohammad Ali from Bahrain and Mr. Mr. Nitin Kumar from Delhi also received runners up prizes from HR Global Director Antoinette Quinn.
Antoinette Quinn commented. “I really enjoyed meeting all our regional winners and was genuinely struck by how much they enjoyed their stay in Ireland and being part of the ARI Star Awards. I would like to congratulate not just Nivine, Redha and Nipin but all of our regional and quarterly winners and I look forward to the 2015 Star Awards”
The ceremony was the culmination of a four day visit to Ireland by all the regional Star Award winners from Canada, Barbados, Cyprus, India, Muscat and Bahrain.
Nivine’s manager Colin Morgan said of his “star performer”: “Nivine is quite simply the benchmark for how all staff should conduct themselves. Time and again she has come to the fore as an ambassador for Chanel and the Loop Montreal. There is rarely a month that passes that we don’t receive amazing feedback from customers telling us about the high level of service she has displayed. Nivine lives and breathes the ARI Way from the way she conducts herself on the shop floor to her natural customer approach and fantastic sales techniques.”
The Star Award winner’s visit coincided with the St. Patrick’s Day Festival and some of the highlights of their stay included, attending the St. Patrick’s Day Parade, a tour of the Guinness Storehouse and going to Croke Park to see The All Ireland Club Hurling and Football Finals. The ARI Ireland Star Award winner Dominic Byrne and the HR team played host to the winners during the week.
MAC Cork Airport In April 2015, there was huge excitement with the arrival of MAC in Cork Airport. MAC has made a huge impact on the shop floor with a super plush state of the art stand and sales figures well exceeding expectations.
Cyprus Legion Run On the 4th of April CTCARI took the challenge, created a team and participated in one of the most adventurous events of the year: LEGION RUN! Legion Run is an event hosted once a year in various countries around the world. Legion Run is a re-creational/sports event which consisted of challenges such as 5K walking/running, crawling through underground tunnels, going through mud (loads of mud!!), and diving in ice-filled tanks with water (yes, ICE!!) But there was no obstacle that could stop us! Everyone was determined to pass the finish line, of course together as one. We trusted each other, helped each other, encouraged each other, respected each other, and enjoyed each other! Our tactic was TEAMWORK! What an unforgettable experience.
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Bahrain Duty Free — Long Service Award Throughout the years Bahrain Duty Free is honored to have employees who have worked almost their whole lives in the company. As a token of appreciation for the loyalty and support of the employees, Bahrain Duty Free has awarded employees for their long service. Some employees have even completed more than 20 years in the company and it brings the company great pleasure and happiness to have such passionate employees. The company’s vision is to win and keep customers by offering the best of Bahraini hospitality and a simply better shopping experience, but at the same time it is also the company’s vision to make their employees a priority and appreciate them for their loyalty and dedication to the company.
Beirut Duty Free Opens New Electronics Store Beirut Duty Free has responded to growing customer demand for electronics by opening a new 225sqm electronics store alongside an 85 sqm Virgin megastore. The new store marks a significant expansion of the previous shop, which covered an area of 170sqm. All the leading consumer electronics brands such as Apple, Samsung, Sony, HTC, Canon and Nikon are also well represented in the store. The focal point of the new store is a striking promotional pillar situated at the shop entrance to showcase the very latest hit products. Further in the store, live listening stations for audio brands, interactive photography visuals and an Innergie charging station all combine to create a more immersive customer experience. "Electronics has become a very important category for us in recent years and we’ve worked very closely with all of our electronics suppliers to develop a really compelling tech proposition for our customers" said Beirut Duty Free General Manager Ciaran O’Neill, who paid tribute to his team for ensuring the shop opened on time.
Delhi Duty Free Congratulations to all the staff at Delhi Duty Free for reaching the highest ever monthly sales figure of $13.2m. They also set a new highest single day total of $561,000 on 27th June 2015. Their previous highest was $509,000 on 17th October 2014. Key categories also achieved the highest ever monthly sale figure. Their Victoria Secret store also crossed the highest ever figure of $100k in June 2015.
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ARI NEW OPERATING MODEL Business Development etc.. While individual business units will still have autonomy to managing their own business, the new structure will drive consistency and high standards across all areas, and ensure individual businesses have the expert support from the centre to achieve their targets.
ARI REORGANISES TO DELIVER GROWTH STRATEGY ARI’s operating model is evolving to reflect the changing nature of our business and our global reach. As part of this evolution, we’ve changed the ARI executive team structure to better support the delivery of the ARI strategy.
As part of the restructure we’ve identified a number of gaps in our organisation which we will be recruiting for over the next few months. All roles will be advertised on the ARI website.
We’ve replaced the previous regional structure with a more streamlined model, which has a strong central team to ensure we have a co-ordinated approach in areas such as Operations, Marketing, Buying, HR,
Our corporate objective is to double our profits by 2017. We believe the new structure will help us to do that.
Chief Executive Jack McGowan Legal Support Executive Assistant
Emily Ennis
Leila Rashidi
Chief Operations Office
Global Buying & Supply
Global Director of Bus Dev
Director of Implementation & Corp Affairs
CFO & Director of ARII
Global Director of HR
Global Director of Strategy & Marketing
ARIME MD
Gerry Crawford
Paul Neeson
John Boland
Philip Eckles
Anthony Kenny
Antoinette Quinn
Nicola Wells
Pat McKenna
Business Dev (M&A) Ronan McArdle
LIVING THE VALUES BRILLIANT AT THE ESSENTIALS Whatever our role, everyday we take pride in doing our job to the highest standards, creating an exceptional environment for our customers and for each other.
TOGETHER WE OVERCOME CHALLENGES We seek solutions before presenting problems and we support each other when we stand up to take responsibility. ALWAYS BETTER We are constantly seeking ways to improve, sharing information and ideas, and always feeling that we have the freedom to ask, ‘how could this be better?’
RESPECTING EACH OTHER’S VALUE We work as a team. All of us have a distinct and valuable role to play; we appreciate each other’s diverse contributions and celebrate success together. As an organisation we are conscious that we need to be flexible and be prepared to change our structure and way of operation in order to be the best and create an outstanding shopping experience every time. Throughout this issue you will note numerous examples of where staff across
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the globe are living the ARI values as they carry out their duties on a daily basis. Our values are the behaviours and actions that define how we work, we believe it’s what sets us apart from our competitors.
ISSUE 2 Summer 2015
N I Y A A D LIFE THE
CANADA’S HEAD OF RETAIL COLIN MORGAN DESCRIBES A TYPICAL WORKING DAY
5’s audit with the staff on duty. This is a great tool to keep the staff informed and get a feel for the shop floor atmosphere and solve any problems quickly.
As we all know, no two days in travel retail are the same, all best laid plans are blown out of the water by 8:15 — so here is just a typical day.
After the floor walk with Paul I will meet the category leads to discuss any replenishment issues we might have. Then I meet with Katharine and Jack from marketing to get updated on current projects and to prioritise marketing tasks. We also visit the stores to make sure that all signage and value message POS are correct and in place.
Canadian weather dictate’s the time the alarm is set. Winter means an extra hour in the car, summer means an extra hour in bed.
By noon I try and get a call in with the Retail Managers in Ottawa, Winnipeg and Halifax. This can take 45 minutes or 2 hours it all depends on the day.
The first thing I do when the alarm goes off is check the previous days sales on my phone and if United have signed Ronaldo or Messi…at least the sales are good!
We have a very strong relationship with our airport partners in Montreal (ADM), I would meet with them most afternoons to discuss sales, marketing, customer service results and our involvement in their “on board” program which is a project set up to improve the customer experience in Airport De Montreal and bring all retail operators, F&B closer together in a positive working environment.
Get to office around 08.00. Look closer at the week to date sales and email the Category leads to investigate any gaps. I also contact the retail managers from the other ARI locations in Canada to investigate or exploit any opportunities in sales threads.
I have an end of day operations clean up call with Seamus and Katia to follow up any outstanding issues. I then visit with the late shift to make sure everything is in place. Once there are no major issues I spend the last few hours following up on the flagged emails and try and realign the weekly plan.
Most weeks we have a conference call with The ARI Way team on — “Embedding the 5S principals” I have an early morning Operational / HR call with the Head of HR (Katia) and the GM (Seamus). Scan through my emails, check for any urgent ones and flag them accordingly.
Most days I’m good to head home between 18:30 and 19:00, traffic isn’t as bad in the evening so it takes 30 minutes to get home.
Meet the Montreal Retail Manager (Paul) and look over the previous day’s daily reports. We then plan the day before visiting the stores and conduct some
To relax, Fiona and I would go out for dinner, this coincidentally happens around a Habs game usually!
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ISSUE 2 Summer 2015
Focus h t r o N On a c i r e Am
Overview ARI secured it’s presence in Canada in February 2001 with the acquisition of the Duty Free Shops in Montreal, Edmonton, Ottawa, Halifax and Winnipeg (We now operate in 4 locations, excluding Edmonton). This occurred seven months before the attack on the twin towers in New York, which resulted in very difficult times for the airline and consequently duty free business in North America.
the airports, the passenger traffic is divided between Transborder to the United States and International to all other locations. Transborder passengers pre clear US Customs and Immigration which means from a Duty Free perspective, separate stores have to be maintained in the Transborder part of the terminal.
The geographic spread of the business is illustrated by the fact that Halifax and Winnipeg are 1.5 and 3 hour Despite this very challenging beginning, ARI’s resilience flights from Montreal respectively. However, given the shone through and today the company in Canada is a regional nature of these airports and their dependence very robust and thriving business. Across the four airports on domestic traffic versus International or Transborder in which ARI trades today, there are 11 shops comprising passengers, 90% of the business is in Montreal. of approximately 2500 sqm of retail in total. In each of
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ISSUE 2 Summer 2015
Recent Events and Plans At the end of 2013, Montreal opened it’s flagship store in the International terminal which has been a resounding success. The project won the prestigious “Grands Prix Du Design of Quebec for 2014” .
The month of June saw a visit from Paula Pryor and Mick Byrne to assist with training on the roll out of Performance Matters and Values of the company. The training was very well received and the sense of energy and vitality was very palpable in the aftermath. May of this year also saw the completion of the rebranding of all stores to “The Loop”. Previously the shops were operating under the brand name “Runway”. So we look forward to take part in extending the global reach of “The Loop” brand.
The international look which also incorporated Canadian elements and sense of place were the main factors which caught the judges eyes in the awarding of this honor.
Finally the summertime is when the city of Montreal comes to life after a long harsh winter. The schedule is full of events beginning in May with the Formula 1 Grand Prix, followed by the Jazz festival, Just for laughs festival and various other events. ARI will be running a big promotion in July and August titled “Love Montreal” which will focus on all that is good about local products and the activities will include make-up artists, tastings, mixologist, IceTaffy maker, and a jazz band. So if you have not yet made your holiday plans, Montreal is waiting for you!
Following on from this, Aerport De Montreal and ARI have agreed to extend the offering available in the terminal in the fashions and accessories categories. This is an exciting development for the company and will bring the retail offering to a new level which will further cement ARI’s presence in Montreal as the Duty Free partner for the airport. This shop is under construction at the moment and will open in Dec this year.
Montreal Comedy Festival
Montreal Jazz Festival
Montreal Grand Prix
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ISSUE 2 Summer 2015
SS E N I S BU TE A D P U ANTHONY KENNY
GERRY CRAWFORD
FINANCIAL & IT UPDATE
ANTHONY KENNY, DIRECTOR OF FINANCE AND ARI IRELAND Financial results overall for ARI are in line with budget for the first half of 2015. Movement in exchange rates during 2015 has impacted trading in certain locations with passengers reacting to either improvement or decline in their purchasing power.
I would like to make a special mention to the IT team involved in the successful opening of the Auckland shops in June. The team have delivered in half the normal development time a fully functional IT platform to support the business, well done and thank you for your hard work and effort.
• Overall Profits are in line with the budget target for the first six months. • Strong profit growth in Dublin aided by passenger growth and the successful refit of T1. • Sales have grown 10% on 2014, strong performances in Dublin, Delhi, Canada and Beirut.
ARI Turnover YTD June Growth vs 2014
22%
9%
6%
10%
10%
Ireland
Middle East
North America
India
ARI
ARI IRELAND
ANTHONY KENNY, DIRECTOR OF FINANCE AND ARI IRELAND We’ve had a strong positive performance for the first 2 quarters of 2015 helped by rising traffic numbers in Dublin, strong growth in Passenger Average Spend and the opening of the new Terminal 1.
Underpinning our positive performance to date has been a number of excellent campaigns, our Destination Skincare campaign for summer has received very positive feedback, and World Whisky day in Dublin at Cork had a great impact by almost doubling sales in this category.
New concepts like Candy Cloud and Wine Goose Chase are helping this growth along with The Irish Whiskey Collection which includes whiskey from all over the world. We are delighted to welcome Vincent Belingard to ARI, A big thank you to all of our staff across the organisation he has joined our team from Harrods in London, Vincent who helped support the Terminal 1 launch in March which will manage our retail operation in Terminal 2 in Dublin. delivered a strong Easter performance.
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ARI MIDDLE EAST
GERRY CRAWFORD, CHIEF OPERATIONS OFFICER, ARIME
BEIRUT
DELHI
Business in Beirut was very good during April with both Easters seeing good traffic numbers from Lebanese returning to celebrate and also leaving on short breaks in Turkey and Sharm el sheikh in Egypt. May and June have seen a slight slow down in sales, mainly due to the worsening situation in Syria and the more frequent clashes along the Lebanese boarder.
DDFS business continued its steady growth in the previous financial year and has been bolstered by our in-house promotions of ‘Win a Car’ and ‘Scratch Card” promotion which have been highly successful, resulting in additional sales of above $4 million during the last year. We have further improved upon our BMW car promotion by upgrading the car from BMW X1 to BMW GT320. We have also improved the mechanics of the promotion, improving ticket brackets . Also, new financial year, DDFS has launched shop wide promo” WIN A TRIP TO SWITZERLAND” ; draw tickets on shopping of every $100 customers will get 1 coupon. Proposed layout of new shops will be finalized soon. The year started with good news of Duncan Lawley, CEO winning Retail Leadership Award at Asia Retail Congress.
The business has seen the introduction of three big brands over the last three months, MAC in the perfume and cosmetics shop and Jo Malone London and Bobbi Brown in the fashion shop. JML is the door in Lebanon and we and Estee lauder are very optimistic about all three brands. In the Confectionary shop we have installed a new M&M pillar with the characters mimicking a local Lebanese story of skiing and sunbathing on the same day. This cans me done on most days in March.
MUSCAT Muscat Duty Free (MDF) is facing challenges as stricter restrictions imposed by several airlines on passenger carry-on luggage coupled with knock on effects on the previous year tobacco ban and a reduction in duty free tobacco allowance in India (where the majority of MDF’s customers are heading), continue to weigh on MDF’s business performance.
BAHRAIN Bahrain Duty Free had a busy start to the year with the commencement of a Back To Basics Programme for line managers; aimed at reminding all of their key responsibilities and impact on results. In terms of promotional activity; the Cash Back initiative was launched with initial results showing some room for further improvements. This was coupled with a successful MasterCard promotion which tied in with the Formula 1 Grand Prix held in April. Finally, in April basket utilization monitoring commenced with strong initial results being recorded.
This restriction is also impacting passengers flying with other airlines (e.g. Oman Air) as the awareness of this issue is influencing them to avoid duty free purchases. Food & confectionary were the worst affected accounting for almost half the total category shortfall for the first half of the year. While discussions with the airlines are so far not proving favorable, the Company has launched a number of promotions, including a target spend-based gift voucher promotion to mitigate the adverse impact of this issue. In addition, MDF in partnership with Oman Air loyalty division, has also launched a Sindbad online-store which allow Sindbad members to redeem their miles at MDF outlets.
QATAR
CYPRUS
1st April Qatar Distribution celebrated fifteen years of operations and another record breaking year. In fifteen years sales have grown thirteen times and net profit by a stunning twenty-six times. The recent renewal of the ARI management contract is another significant milestone and gives ARI another four years to build on this success story. Double-digit growth is expected to continue for the foreseeable future and the focus is now on the location of a new site and the design and development of new facilities to ensure that all growth opportunities can be fully exploited.
CTCARI had a busy winter & spring preparing for the summer rush. The Larnaca fashions area was refurbished with new introductions from Paul & Shark, Versace, Hugo Boss Green & Orange and Furla. New Pop up shop’s by Desigual, Ray Ban, Cath Kidston, Polaroid and Cyprus Memories were also implemented. While the final key initiative was the introduction of the new Pandora Evolution store concept, all of these actions are aimed at assisting our retail team in maximising sales with our Russian & UK passengers, key contributors to our business.
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ISSUE 2 Summer 2015
ARI NORTH AMERICA
GERRY CRAWFORD, CHIEF OPERATIONS OFFICER, ARINA CANADA
BARBADOS
After one of the most severe winters in history in Quebec Caribbean ARI Inc. are in the midst of a renovation of it’s nice to see that we are over the worst and that snow their Liquor category. is disappearing and once again we can actually see the grass on the ground. The ‘Caribbean Rum Collection’ will showcase the premium range of Rums available from across the The CAD$ has weakened considerably in the last few Caribbean. With over eighty Rums available, we shall months and this has impacted our “snowbirds” flying have one of the broadest collections in the region. Our south for their holidays, as their personal budgets are official opening will be 23rd July, which enables us to stretched a bit more than usual due to the currency launch in advance of the busy crop-over period. fluctuation. Conversely on the transborder side the currency weakness of the CAD$ is beneficial for the Crop-over was originally a celebration signaling the end US based passenger and this is actually helping our of the yearly sugar cane harvest, it has since evolved sales quite a lot. The passenger flow down to our Gate 1 into Barbados’ biggest national festival similar to Carnival shop has not materialized just yet, which has left us well in Brazil and Trinidad. Many returning Bajan’s and behind budget for this shop, but due to renovations in visitors fly in to celebrate crop-over which culminates on the airport we expect that this will change soon. Kadooment Day, a national holiday when costume bands fill the streets with pulsating Barbadian rhythms. Back in Montreal, the hoardings have gone up for the new fashion development and works are ongoing now with the airport and the consultants for the shop development.
Next issue
WINTER 2015
AUCKLAND Photos and Interviews with staff CHRISTMAS Preparations from around the world FOCUS On Delhi
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