Group 1 - Haleon has completed the acquisition of the remaining 12% stake in its OTC joint venture, China-SK Pharmaceutical Co., Ltd., making it a wholly-owned subsidiary [1] - The acquisition signifies Haleon's commitment to the Chinese market, which is crucial for driving global growth and enhancing brand competitiveness [1] - China-SK has a strong historical presence and is recognized for its brands in pain management, respiratory health, skin health, and digestive health [1] Group 2 - Haleon aims to enhance daily health with its mission and will continue to support the innovation and development of OTC products in China [2] - The company plans to deepen its channel layout to reach a broader consumer base with its health products and services [2] - Haleon's product portfolio includes six core categories: oral health, nutritional health, pain management, respiratory health, digestive health, and skin health [3]

Core Insights - The article compares Haleon PLC Sponsored ADR (HLN) and Stryker (SYK) to determine which stock offers better value for investors [1] Group 1: Zacks Rank and Earnings Outlook - Haleon PLC has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Stryker has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank emphasizes companies with positive earnings estimate revisions, suggesting that HLN's earnings outlook is improving more significantly than SYK's [3][7] Group 2: Valuation Metrics - HLN has a forward P/E ratio of 21.28, compared to SYK's forward P/E of 29.60, indicating that HLN may be undervalued relative to SYK [5] - The PEG ratio for HLN is 2.92, while SYK's PEG ratio is 2.98, suggesting that HLN's expected earnings growth is more favorable [5] - HLN's P/B ratio is 2.24, significantly lower than SYK's P/B of 7.21, further supporting HLN's valuation as more attractive [6] - Based on these metrics, HLN receives a Value grade of B, while SYK is rated D, indicating a stronger value proposition for HLN [6]

Core Viewpoint - Haleon PLC Sponsored ADR (HLN) has experienced significant selling pressure, resulting in a 7.4% decline over the past four weeks, but analysts anticipate better earnings than previously expected, indicating potential for recovery [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is utilized to determine if HLN is oversold, with a reading of 25.05 suggesting that heavy selling may be exhausting, indicating a possible price rebound [2][5]. - Stocks oscillate between overbought and oversold conditions, and the RSI helps identify potential reversal points, making it a useful tool for investors seeking entry opportunities [3]. Group 2: Fundamental Indicators - There is a consensus among sell-side analysts that earnings estimates for HLN have increased by 0.3% over the last 30 days, which typically correlates with price appreciation in the near term [7]. - HLN holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a turnaround [8].

Group 1 - Haleon has appointed Carl Haney as Chief Research & Development Officer, effective August 1, 2025, following Franck Riot's departure after six years [1][2] - Carl Haney brings 13 years of experience from Estée Lauder and over 20 years from Procter & Gamble, focusing on innovation and R&D in consumer businesses [1][2] - The CEO of Haleon, Brian McNamara, expressed confidence in Haney's ability to drive transformative innovation and contribute to the company's new "Win as One" strategy [2][3] Group 2 - Franck Riot's contributions to Haleon were acknowledged, particularly in advancing the innovation agenda during the company's transition [3] - Carl Haney expressed enthusiasm about joining Haleon at a pivotal time, emphasizing the importance of R&D in achieving the company's goals of enhancing everyday health [3] - Haleon is positioned as a global leader in consumer health, with a diverse product portfolio across six major categories, including Oral Health and Pain Relief [4]

Core Insights - A recent survey indicates that over 80% of Canadians desire whiter teeth, but sensitivity and cost are significant barriers [1][2] - Many Canadians are turning to alternative whitening methods popularized on TikTok, with 40% using options like baking soda and activated charcoal, but 46% report increased sensitivity as a result [2] - There is a clear demand for affordable, convenient, and sensitivity-friendly whitening solutions, particularly with National Smile Day approaching [3] Company Insights - Sensodyne, a leading brand for sensitive teeth, has introduced Clinical White toothpaste, which is designed to provide effective whitening while protecting sensitive teeth [4][5] - Clinical White is clinically proven to whiten teeth up to two shades and offers 24/7 sensitivity protection without hydrogen peroxide, making it suitable for daily use [5][6] - The product is positioned as an ideal solution for consumers who enjoy coffee and red wine but want to maintain a bright smile without discomfort [6] Market Context - The survey highlights that sensitivity is the primary concern for 20% of Canadians when considering teeth whitening options [4] - Despite the availability of dentist-administered whitening treatments, only 26% of Canadians have tried them due to concerns about cost and sensitivity [2] - Sensodyne's Clinical White is launched just in time for National Smile Day, aiming to meet the demand for a pain-free whitening solution [6]

Core Points - A consumer reported a complaint regarding a product purchased from Pinduoduo, claiming that the product's cap had a Tmall International traceability QR code, which led to confusion about the product's expiration date [1] - The official response from Caltrate clarified that the QR code scanned was related to the production facility's qualification certificate, not the product's expiration date [8] - The expiration date on the product was confirmed to be February 2026, despite the QR code indicating a registration expiration of December 31, 2024 [8] Company Response - Caltrate stated that the product was purchased from a non-authorized store on Pinduoduo, and the products sold there are not directly supplied by the brand [8] - The company emphasized that the traceability code on the product indicates it may have been sold through Tmall International at some point, but the current sales channel does not require official brand authorization [8] - Caltrate has reminded its distributors to update the facility qualification certificates to avoid future confusion [8]

Core Insights - The article emphasizes the importance of identifying undervalued companies with strong fundamentals and growth potential, focusing on rigorous value investing strategies [1] Group 1: Investment Strategy - The company employs a value investing approach that combines thorough fundamental analysis with a focus on companies trading significantly below their intrinsic value [1] - Priority is given to businesses with robust cash flows, strong balance sheets, and competent management teams [1] - A long-term investment horizon is maintained to allow investment theses to materialize [1] Group 2: Goals and Outcomes - The aim is to generate superior risk-adjusted returns through disciplined research and patience [1] - The strategy is designed to help followers build lasting wealth through strategic value investments in quality businesses [1]

[Front Matter and Company Overview](index=1&type=section&id=Front%20Matter) [Filing Information](index=1&type=section&id=Filing%20Information) This annual report for the fiscal year ending December 31, 2024, is filed under IFRS by Haleon plc, a large accelerated filer - The report is an annual filing (Form 20-F) for the fiscal year ended **December 31, 2024**[3](index=3&type=chunk) - Haleon plc is classified as a **large accelerated filer** and a **well-known seasoned issuer**[6](index=6&type=chunk)[10](index=10&type=chunk) - The financial statements are prepared using **International Financial Reporting Standards (IFRS)** as issued by the IASB[11](index=11&type=chunk) [Haleon at a Glance](index=4&type=section&id=Haleon%20at%20a%20glance) Haleon is a global consumer health leader targeting 4-6% annual organic revenue growth and a net debt/EBITDA ratio of ~2.5x - Haleon's purpose is to deliver **better everyday health with humanity**[17](index=17&type=chunk) - The company has leadership positions in five global categories: Oral Health, VMS, Pain Relief, Respiratory Health, and Digestive Health and Other[18](index=18&type=chunk) Medium-Term Financial Guidance | Metric | Guidance | | :--- | :--- | | Annual organic revenue growth | 4-6% | | Organic operating profit growth | Ahead of organic revenue growth | | Net debt/adjusted EBITDA | Expected to be around 2.5x | | Dividend | To grow at least in line with adjusted earnings | [Strategic Report](index=5&type=section&id=Strategic%20Report) [2024 Highlights](index=6&type=section&id=2024%20highlights) Haleon achieved 5% organic revenue growth and strong cash flow in 2024, returning over £1 billion to shareholders while advancing strategic goals Key Financial Highlights 2024 | Metric | 2024 Value | 2023 Value | | :--- | :--- | :--- | | Revenue | £11.2bn | £11.3bn | | Operating Profit | £2.2bn | £2.0bn | | Operating Profit Margin | 19.6% | 17.7% | | Organic Revenue Growth | 5.0% | 8.0% | | Organic Operating Profit Growth | 9.8% | 10.8% | | Free Cash Flow | £1.9bn | £1.6bn | | Net Debt/Adjusted EBITDA | 2.8x | 3.0x | 2024 Revenue Breakdown | Breakdown | Category/Region | Revenue | Percentage | | :--- | :--- | :--- | :--- | | **By Geography** | North America | £4.0bn | 36% | | | EMEA & LatAm | £4.6bn | 41% | | | APAC | £2.6bn | 23% | | **By Market Category** | Oral Health | £3.3bn | 29% | | | VMS | £1.7bn | 15% | | | Pain Relief | £2.6bn | 23% | | | Respiratory Health | £1.7bn | 15% | | | Digestive Health and Other | £1.9bn | 18% | - The company returned **over £1 billion to shareholders** in 2024 through its first share buyback program and dividend payments[36](index=36&type=chunk) - Achieved its health inclusivity ambition to empower **50 million people a year**, one year ahead of the 2025 plan[39](index=39&type=chunk) [Chair's Statement](index=8&type=section&id=Chair's%20statement) The Chair highlighted strong progress, disciplined capital allocation, and a proposed 10% dividend increase to 6.6p per share - The company executed disciplined capital allocation, including the disposal of ChapStick and non-US Nicotine Replacement Therapy for **c.£0.8 billion** and investing **£0.5 billion** to increase its stake in the China OTC joint venture to 88%[44](index=44&type=chunk) - **Over £1 billion was returned to shareholders** through the first share buyback program and dividend payments, with a further **£500 million allocated for share buybacks in 2025**[45](index=45&type=chunk) - The Board proposes a total dividend of **6.6p per ordinary share**, a 10% increase, representing a payout ratio of approximately 37% of 2024 adjusted earnings[46](index=46&type=chunk) - New board members were appointed to add global FMCG, financial, and digital technology experience, including **Dawn Allen as CFO**[51](index=51&type=chunk) [Chief Executive Officer's Review](index=9&type=section&id=Chief%20Executive%20Officer's%20review) The CEO reported strong operational momentum, with 5% organic revenue growth and £1.9 billion in free cash flow enabling deleveraging 2024 Financial Performance Summary | Metric | Growth Rate | | :--- | :--- | | Organic Revenue Growth | 5.0% | | Reported Revenue Growth | (0.6)% | | Organic Operating Profit Growth | 9.8% | | Reported Operating Profit Growth | 10.5% | - Achieved strong free cash flow of **£1.9 billion**, allowing for debt reduction to **2.8x net debt/adjusted EBITDA**[60](index=60&type=chunk) - **71% of brands gained or maintained market share**, supported by innovations like Sensodyne Clinical White[67](index=67&type=chunk) - The outlook for 2025 includes expected **organic revenue growth of 4-6%** and organic operating profit growth ahead of revenue[65](index=65&type=chunk) [Our Business Environment](index=10&type=section&id=Our%20business%20environment) Haleon operates in a growing c.£200 billion consumer health market, driven by an aging population and a consumer shift to self-care - Haleon operates in a fast-growing, **c.£200 billion global consumer health market**[68](index=68&type=chunk) Global Market Share Position (2023) | Category | Haleon's Market Share | Haleon's Rank | | :--- | :--- | :--- | | Oral Health (Therapeutic) | ~11% (c.45% in Therapeutic) | 3 (1 in Therapeutic) | | VMS | ~3% | 1 | | Pain Relief | ~13% | 1 | | Respiratory Health | 5.6% | Joint 1 | | Digestive Health | 4.2% | 4 | - Major long-term growth drivers include a growing and aging population, an expanding middle class in emerging markets, a consumer shift towards self-care, and pressure on public healthcare systems[77](index=77&type=chunk)[78](index=78&type=chunk) [Our Business Model](index=12&type=section&id=Our%20business%20model) The business model leverages human understanding and trusted science to drive a sustainable growth cycle of revenue, profit, and cash conversion - The business model's competitive advantage stems from combining **deep human understanding with trusted science**[81](index=81&type=chunk) - The company engages with **over 3.5 million Health Professionals** who recommend its products, driving new user acquisition[85](index=85&type=chunk) - In 2024, Haleon returned **over £1 billion to shareholders** through share buybacks and dividends and invested **c.£0.5 billion** to increase its equity in its China joint venture, TSKF[92](index=92&type=chunk) [Our Key Stakeholders](index=14&type=section&id=Our%20key%20stakeholders) Haleon engages seven key stakeholder groups, using insights from these interactions to inform strategic decisions and measure outcomes - Haleon engages with seven key stakeholder groups: Consumers, Customers, Employees, Governments, Health Professionals, Investors, and Suppliers[100](index=100&type=chunk) Stakeholder Engagement Examples and Outcomes (2024) | Stakeholder | Engagement Example | Outcome Example | | :--- | :--- | :--- | | Consumers | Handled c.1.3m consumer enquiries | Consumer satisfaction (CSAT) improved 16 points | | Employees | Annual engagement survey | Employee engagement score of 81% | | Health Professionals | Haleon Health Partner portal | Reached nearly 1m health professional registrations | | Suppliers | Innovation events | Over 600 suppliers attended innovation events | [Our Strategy](index=16&type=section&id=Our%20strategy) The company's strategy focuses on increasing household penetration, capitalizing on new opportunities, and maintaining financial discipline - The strategy is based on four pillars: 1) Increase household penetration, 2) Capitalise on new and emerging opportunities, 3) Maintain strong execution and financial discipline, and 4) Run a responsible business[102](index=102&type=chunk)[107](index=107&type=chunk) - A key growth driver is **increasing household penetration** by innovating to address unmet consumer needs[103](index=103&type=chunk) - The company aims to expand its portfolio by pursuing **Rx-to-OTC switches** and entering new consumer trend areas[104](index=104&type=chunk)[107](index=107&type=chunk) - Running a responsible business is integral to the strategy, with goals focused on ESG, including **health inclusivity and environmental protection**[106](index=106&type=chunk) [Our Market Categories](index=17&type=section&id=Our%20market%20categories) Haleon drives growth across five key categories through innovation, emerging market expansion, and healthcare professional engagement [Oral Health](index=17&type=section&id=Oral%20Health) The Oral Health category, a global leader in therapeutic care, generated £3.3 billion in revenue driven by innovation and emerging market expansion Oral Health Performance | Metric | Value | | :--- | :--- | | 2024 Revenue | £3.3bn | | Global Market Share (2023) | 11% | - Successfully launched **Sensodyne Clinical White**, which ranked as the **1 innovation in the US Oral Health category** and drove market share growth[112](index=112&type=chunk) - Expanded into emerging markets with affordable products, such as the **Sensodyne 20 rupee pack in India** and the launch of parodontax in China[112](index=112&type=chunk) [Vitamins, Minerals and Supplements (VMS)](index=18&type=section&id=Vitamins,%20Minerals%20and%20Supplements%20(VMS)) The VMS category, a market leader, generated £1.7 billion in revenue by increasing penetration with tailored and affordable products VMS Performance | Metric | Value | | :--- | :--- | | 2024 Revenue | £1.7bn | | Global Market Share (2023) | 2.8% | - Expanded the Centrum range in Brazil with **affordable single-dose sachets**, introducing new consumers to the VMS category[117](index=117&type=chunk) - Launched **Emergen-C Crystals Immune+** and zero-sugar formulas in the US, contributing to category share growth[117](index=117&type=chunk) [Pain Relief](index=19&type=section&id=Pain%20Relief) The market-leading Pain Relief category generated £2.6 billion in revenue, supported by new topical product launches and professional engagement Pain Relief Performance | Metric | Value | | :--- | :--- | | 2024 Revenue | £2.6bn | | Global Market Share (2023) | 13% | - Launched **Advil Targeted Relief** in the US, the first topical pain relief product from the Advil brand[121](index=121&type=chunk) - Engaged approximately **42,000 Health Professionals** during the 4th Global Pain Awareness Week[121](index=121&type=chunk) [Respiratory Health](index=20&type=section&id=Respiratory%20Health) The Respiratory Health category, a joint market leader, generated £1.7 billion in revenue through product roll-outs and sustainability initiatives Respiratory Health Performance | Metric | Value | | :--- | :--- | | 2024 Revenue | £1.7bn | | Global Market Share (2023) | 5.6% | - Continued the successful roll-out of **Otrivin Nasal Mist** across Europe, driving share growth in launch markets[126](index=126&type=chunk) - Began rolling out new, easy-to-open, more recyclable paper packaging for Flonase, aiming to avoid **over 160 tonnes of plastic waste per year**[126](index=126&type=chunk) [Digestive Health and Other](index=21&type=section&id=Digestive%20Health%20and%20Other) This category generated £1.9 billion in revenue, highlighted by the strategic US launch of Eroxon and the divestment of its non-US Smokers' Health business Digestive Health and Other Performance | Metric | Value | | :--- | :--- | | 2024 Revenue | £1.9bn | | Global Market Share (2023) | 4.2% | - Launched **Eroxon** in the US, the first OTC, FDA-cleared treatment for erectile dysfunction[131](index=131&type=chunk) - **Divested the Smokers' Health business** outside of the US to focus resources on higher growth brands[130](index=130&type=chunk) [Our Culture and People](index=22&type=section&id=Our%20culture%20and%20people) Haleon fosters a purpose-led culture, achieving an 81% employee engagement score and maintaining strong health, safety, and ethical standards - Achieved an **81% overall employee engagement score** in 2024, an increase of 3% from 2023[63](index=63&type=chunk)[142](index=142&type=chunk) Company Gender Representation (as at 31 Dec 2024) | Level | Men | Women | Total | | :--- | :--- | :--- | :--- | | Directors | 5 | 6 | 11 | | Executive Team | 7 | 6 | 13 | | Senior managers | 773 | 653 | 1,434 | | All employees | 12,996 | 11,431 | 24,561 | Health and Safety Performance | Metric (per 100,000 hours worked) | 2024 | 2023 | | :--- | :--- | :--- | | Reportable Injury and Illness Rate | 0.13 | 0.14 | | Lost time injury and illness rate | 0.10 | 0.10 | - The company maintains a robust cyber security function, which provides frequent updates to the Executive Team and Audit & Risk Committee, with **no significant cyber-security incidents identified in 2024**[170](index=170&type=chunk) [Our Approach to Sustainability](index=26&type=section&id=Our%20approach%20to%20sustainability) The sustainability strategy focuses on health inclusivity, environmental impact, and ethics, achieving key carbon and social targets ahead of schedule Sustainability Performance vs. Targets | Aim | 2024 Performance | Target | | :--- | :--- | :--- | | People empowered (Health Inclusivity) | 50m+ | 50m by 2025 | | Net Scope 1 & 2 carbon reduction (vs 2020) | -50% | -100% by 2030 | | Scope 3 carbon reduction (vs 2022) | -10% | -42% by 2030 | | Virgin petroleum-based plastic reduction (vs 2022) | -1% | -10% by 2025 | | Recycle-ready packaging | 74% | Develop solutions for all by 2025 | - Empowered **over 50 million people** in 2024, achieving the 2025 health inclusivity target one year ahead of plan[183](index=183&type=chunk) - Achieved a **50% net reduction** in market-based Scope 1 and 2 carbon emissions versus the 2020 baseline[174](index=174&type=chunk) [Task Force on Climate-related Financial Disclosures (TCFD)](index=28&type=section&id=Task%20Force%20on%20Climate-related%20Financial%20Disclosures%20(TCFD)) Haleon's TCFD report outlines its governance and strategy for climate risks, identifying flooding and carbon pricing as key long-term challenges - The Board has overall accountability for climate-related risks and opportunities, with oversight delegated to the **Environmental & Social Sustainability (ESS) and Audit & Risk Committees**[192](index=192&type=chunk)[194](index=194&type=chunk) - Physical risk analysis identified **riverine/flash flooding and heatwaves** as the greatest long-term threats to key sites in Puerto Rico, China, and Ireland[217](index=217&type=chunk) - Transition risk analysis shows that under a 1.5°C scenario, **carbon pricing could pose a medium financial risk** if emissions targets are not met, with Scope 3 emissions being the largest exposure[238](index=238&type=chunk) - Changing consumer preferences for sustainable products represent both a medium risk and a significant opportunity, potentially adding **2.6% to revenue in 2032** under a 1.5°C scenario[242](index=242&type=chunk)[252](index=252&type=chunk) [Our Key Performance Indicators (KPIs)](index=36&type=section&id=Our%20key%20performance%20indicators) Haleon tracks strategic progress via KPIs, reporting 5% organic revenue growth, strong cash flow, and improved market share in 2024 2024 Key Performance Indicators | KPI | 2024 Result | 2023 Result | | :--- | :--- | :--- | | Organic revenue growth | 5.0% | 8.0% | | Organic operating profit growth | 9.8% | 10.8% | | Free cash flow | £1.9bn | £1.6bn | | Adjusted diluted EPS growth | 3.5% | -6.0% | | Net debt/adjusted EBITDA | 2.8x | 3.0x | | Business gained/maintained share | 71% | 58% | | Carbon reduction (Scope 1 & 2 vs 2020) | -50% | -48% | | Virgin petroleum-based plastic reduction (vs 2022) | -1% | +3% | | Employee engagement | 81% | 78% | - Executive remuneration is linked to KPIs through the **Annual Incentive Plan** and **Performance Share Plan**[282](index=282&type=chunk)[284](index=284&type=chunk)[287](index=287&type=chunk) [2024 Business Review](index=38&type=section&id=2024%20Business%20review) The 2024 business review highlights strong financial performance, active portfolio management, and significant debt reduction and shareholder returns 2024 Financial Summary | Metric | 2024 (£m) | 2023 (£m) | % Change (Reported) | | :--- | :--- | :--- | :--- | | Revenue | 11,233 | 11,302 | (0.6)% | | Operating profit | 2,206 | 1,996 | 10.5% | | Adjusted operating profit | 2,500 | 2,549 | (1.9)% | | Profit after tax (attributable to shareholders) | 1,442 | 1,049 | 37.5% | | Diluted EPS (pence) | 15.7 | 11.3 | 38.9% | | Adjusted diluted EPS (pence) | 17.9 | 17.3 | 3.5% | - **Organic revenue grew 5.0%**, driven by a combination of price (+3.7%) and volume/mix (+1.3%)[291](index=291&type=chunk)[315](index=315&type=chunk) - The company divested ChapStick and the non-US Nicotine Replacement Therapy business, raising proceeds of **£0.8 billion**[290](index=290&type=chunk) - **Net debt was reduced by £607 million to £7.9 billion**, with leverage at **2.8x net debt to adjusted EBITDA**[296](index=296&type=chunk)[297](index=297&type=chunk) [Geographical Segment Performance](index=40&type=section&id=Geographical%20segment%20performance) Haleon achieved broad-based organic growth, with EMEA & LatAm leading at 7.9%, followed by APAC at 6.0% and North America at 1.1% 2024 Organic Revenue Growth by Geography | Region | Organic Revenue Growth | Price Component | Volume/Mix Component | | :--- | :--- | :--- | :--- | | North America | 1.1% | 2.3% | (1.2)% | | EMEA & LatAm | 7.9% | 5.9% | 2.0% | | APAC | 6.0% | 1.9% | 4.1% | | **Group Total** | **5.0%** | **3.7%** | **1.3%** | 2024 Organic Operating Profit Growth by Geography | Region | Organic Operating Profit Growth | | :--- | :--- | | North America | (2.1)% | | EMEA & LatAm | 20.2% | | APAC | 12.6% | | **Group Total** | **9.8%** | [Revenue by Market Category](index=44&type=section&id=Revenue%20by%20market%20category) Oral Health and VMS led organic growth at 9.6% and 7.6% respectively, while Pain and Respiratory Health performance was muted 2024 Revenue by Market Category | Market Category | Revenue (£m) | Organic Growth (%) | | :--- | :--- | :--- | | Oral Health | 3,312 | 9.6% | | VMS | 1,696 | 7.6% | | Pain Relief | 2,564 | 0.1% | | Respiratory Health | 1,677 | 0.9% | | Digestive Health and Other | 1,984 | 5.5% | - Oral Health growth was supported by the continued roll-out of **Sensodyne Clinical White**, which was the number one US Oral Health market launch in 2024[335](index=335&type=chunk) - Respiratory Health growth was muted due to lapping strong 2023 comparatives and a **softer cold and flu season in H2 2024**, particularly in the US[349](index=349&type=chunk) [Indebtedness, Liquidity and Financial Risk Management](index=46&type=section&id=Indebtedness,%20liquidity%20and%20financial%20risk%20management) Haleon reduced its net debt to £7.9 billion, achieving a 2.8x leverage ratio while maintaining a strong liquidity position of £4.1 billion Debt and Leverage | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Total Borrowings | £10,127m | £9,456m | | Net Debt | £7,907m | £8,514m | | Net Debt / Adjusted EBITDA | 2.8x | 3.0x | - The Group has **total liquidity of £4.1 billion**, including £2.25 billion in cash and £1.9 billion in undrawn credit facilities[357](index=357&type=chunk) - The currency mix of net debt is primarily **USD (56%) and EUR (25%)**, aligning with the currency mix of earnings to manage foreign exchange risk[361](index=361&type=chunk)[362](index=362&type=chunk) [Use of Non-IFRS Measures](index=47&type=section&id=Use%20of%20non-IFRS%20measures) Haleon uses non-IFRS measures like 'Adjusted Results' and 'Organic Growth' to provide a clearer view of underlying business performance - Adjusted results exclude items such as net amortisation and impairment of intangible assets, restructuring costs, transaction-related costs, separation costs, and disposals[365](index=365&type=chunk)[367](index=367&type=chunk) - Organic growth measures further exclude the impact of divestments, acquisitions, and foreign currency exchange movements to allow for a year-on-year comparison of underlying performance[378](index=378&type=chunk)[379](index=379&type=chunk) Reconciliation of IFRS to Adjusted Operating Profit (2024) | Item | Amount (£m) | | :--- | :--- | | **IFRS Operating Profit** | **2,206** | | Net amortisation and impairment of intangible assets | 147 | | Restructuring costs | 214 | | Transaction-related costs | (1) | | Separation and admission costs | 30 | | Disposals and others | (96) | | **Adjusted Operating Profit** | **2,500** | [Our Approach to Risk](index=55&type=section&id=Our%20approach%20to%20risk) Haleon employs a comprehensive risk framework to manage principal risks including growth targets, supply chain, ESG, and cyber security - The Board has ultimate accountability for risk management and defining risk appetite, with oversight delegated to the **Audit & Risk Committee (ARC)**[410](index=410&type=chunk)[412](index=412&type=chunk) - Principal risks include: failure to meet growth objectives, inability to attract and retain talent, supply chain resilience, trusted ingredients, environmental, social and governance (ESG) risks, cyber security, and geopolitical instability[419](index=419&type=chunk)[422](index=422&type=chunk)[423](index=423&type=chunk)[427](index=427&type=chunk)[430](index=430&type=chunk)[431](index=431&type=chunk)[434](index=434&type=chunk) - The risk of **cyber security threats has increased** due to a rise in global incidents, supplier exposure, and the adoption of AI tools[431](index=431&type=chunk) - **Artificial Intelligence (AI) is identified as an emerging risk**, presenting both opportunities for performance and risks related to governance, data privacy, and security[436](index=436&type=chunk) [Viability Statement](index=61&type=section&id=Viability%20statement) The Directors confirm the Group's viability over a three-year period, supported by stress testing against severe but plausible risk scenarios - The Directors assessed the company's viability over a three-year period, concluding they have a **reasonable expectation that the Group can meet its liabilities** as they fall due[439](index=439&type=chunk)[443](index=443&type=chunk) - Stress testing was performed against severe but plausible scenarios, including a **major manufacturing site shutdown**, inability to access capital markets, and a **significant product recall**[441](index=441&type=chunk)[444](index=444&type=chunk) - The Group has available mitigating actions to withstand the impact of severe risk scenarios, such as **reducing A&P spend, cutting capital expenditure, and pausing M&A**[442](index=442&type=chunk) [Corporate Governance](index=63&type=section&id=Corporate%20Governance) [Our Board of Directors and Executive Team](index=63&type=section&id=Our%20Board%20of%20Directors) Haleon's Board comprises 11 members with strong gender diversity and a broad range of consumer, international, and financial skills Board Composition (as of 6 March 2025) | Role | Count | | :--- | :--- | | Chair | 1 | | Executive Directors | 2 | | Independent Non-Executive Directors | 8 | | **Total** | **11** | - The Board demonstrates strong gender diversity, with **6 women and 5 men**[451](index=451&type=chunk) - Key skills and experience on the Board include **Consumer and Retail (10 directors)**, **International (10 directors)**, and **Finance (8 directors)**[453](index=453&type=chunk) - **Dawn Allen was appointed Chief Financial Officer** on November 1, 2024, bringing extensive global FMCG and finance experience[456](index=456&type=chunk) [Letter from the Chair (Governance)](index=68&type=section&id=Letter%20from%20the%20Chair) The Chair's letter details the Board's focus on strategy, capital allocation, and succession planning, including a £500 million share buyback - The Board visited China to better understand the market, resulting in a decision to increase Haleon's interest in its **China JV from 55% to 88%**[488](index=488&type=chunk) - After deleveraging from c.4x to c.2.8x net debt/adjusted EBITDA since demerger, the company commenced a **£500 million share buyback program** in 2024[491](index=491&type=chunk) - The company undertook its **first external Board evaluation**, conducted by Christopher Saul Associates Limited[497](index=497&type=chunk) - Key succession activities included appointing **Dawn Allen as the new CFO** and welcoming Alan Stewart and Nancy Avila as new independent Non-Executive Directors[494](index=494&type=chunk)[496](index=496&type=chunk) [Governance Structure and Board Activities](index=69&type=section&id=Governance%20structure) Haleon's governance framework ensures clear accountability, with the Board and its four committees overseeing strategy, risk, and performance - The Board's governance structure includes four primary committees: **Audit & Risk, Environmental & Social Sustainability, Nominations & Governance, and Remuneration**[500](index=500&type=chunk)[502](index=502&type=chunk) - Key Board decisions in 2024 included approving the increase in the TSKF joint venture stake in China to 88% and approving a **£500 million allocation for share buybacks**[508](index=508&type=chunk) - The Board conducted its first external performance review, which concluded that the **Board and its committees operate effectively**[539](index=539&type=chunk)[541](index=541&type=chunk) - Workforce engagement is managed through a designated Non-Executive Director, Dame Vivienne Cox, who held **five sessions with employees in 2024** and reported findings to the Board[545](index=545&type=chunk)[550](index=550&type=chunk) [Audit & Risk Committee Report](index=76&type=section&id=Audit%20&%20Risk%20Committee%20Report) The committee maintained rigorous oversight of financial reporting and internal controls, including SOX compliance and brand impairment testing - The committee's key responsibilities include overseeing financial reporting integrity, the audit process, internal controls, and risk management systems[556](index=556&type=chunk)[561](index=561&type=chunk) - A significant reporting matter considered was the recoverable amount of indefinite life brands, leading to a **£135 million non-cash impairment charge for the Nexium brand**[567](index=567&type=chunk) - The committee maintained close oversight of **SOX Section 404 compliance** and concluded that internal control over financial reporting was effective as of December 31, 2024[581](index=581&type=chunk) - The total fees paid to the external auditor, KPMG, for the year ended December 31, 2024, were **£19 million**, of which £2 million was for non-audit work[592](index=592&type=chunk) [Environmental & Social Sustainability Committee Report](index=81&type=section&id=Environmental%20&%20Social%20Sustainability%20Committee%20Report) The ESS Committee oversaw significant progress in sustainability, focusing on health inclusivity, carbon reduction, and sustainable packaging - The committee's responsibilities include overseeing progress against the ESS agenda, emerging ESS issues, stakeholder engagement, and external ESS reporting[604](index=604&type=chunk) - Conducted deep dives on key topics including **health inclusivity, sustainable packaging, carbon reduction (SBTi), and nature-related disclosures (TNFD)**[606](index=606&type=chunk) - Oversaw the publication of Haleon's first **Responsible Business Report and Climate Action Transition Plan**, and monitored readiness for CSRD[606](index=606&type=chunk)[616](index=616&type=chunk) - Reviewed and confirmed the virgin petroleum-based plastic reduction target of **10% by 2025** and the goal for all product packaging to be **recycle-ready by 2025**[609](index=609&type=chunk) [Nominations & Governance Committee Report](index=83&type=section&id=Nominations%20&%20Governance%20Committee%20Report) The committee focused on Board succession, appointing a new CFO and three Non-Executive Directors to enhance financial and digital skills - Led the appointment of **Dawn Allen as CFO** and three new Independent Non-Executive Directors: Alan Stewart, Nancy Avila, and Bláthnaid Bergin[621](index=621&type=chunk) - The Board appointment process identified needs for **enhanced digital/technical expertise** and a successor for the Audit & Risk Committee Chair[633](index=633&type=chunk)[641](index=641&type=chunk) - As of March 2025, the Board met the **FTSE Women Leaders Review recommendations** and the **Parker Review objective** for ethnic minority representation[647](index=647&type=chunk) Board Diversity Statistics (as of 6 March 2025) | Category | Board Members | % of Board | | :--- | :--- | :--- | | **Gender** | | | | Men | 4 | 36% | | Women | 7 | 64% | | **Ethnicity** | | | | White | 8 | 73% | | Asian/Asian British | 2 | 18% | | Mixed/Multiple Ethnic Groups | 1 | 9% | [Directors' Remuneration Report](index=86&type=section&id=Directors'%20Remuneration%20Report) The report outlines how pay is aligned with performance, with the 2024 AIP paying out at 58.2% and the 2022-24 PSP vesting at 76% - The 2024 Annual Incentive Plan (AIP) outcome was **58.2% of maximum for the CEO**, based on financial performance and individual objectives[655](index=655&type=chunk)[674](index=674&type=chunk) - The 2022-2024 Performance Share Plan (PSP) awards will vest at **76% of maximum**, after the Committee applied downward discretion of c.9 percentage points[656](index=656&type=chunk)[675](index=675&type=chunk) - For 2025, the AIP financial metric weightings will be rebalanced to **40% organic revenue growth and 40% organic operating profit growth**[658](index=658&type=chunk)[663](index=663&type=chunk) - Executive Director salaries will increase by **3.5% for 2025**, in line with the average increase for the UK workforce[661](index=661&type=chunk) [Annual Report on Remuneration](index=90&type=section&id=Annual%20Report%20on%20Remuneration) This section details 2024 remuneration outcomes, including a total of £9.1 million for the CEO and specific AIP and PSP vesting results 2024 'Single Figure' of Remuneration (£'000) | Executive Director | Salary | Benefits | Pension | AIP | PSP | Other | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Brian McNamara (CEO) | 1,292 | 122 | 90 | 1,520 | 6,038 | - | 9,062 | | Tobias Hestler (Outgoing CFO) | 604 | 34 | 42 | 701 | - | - | 1,381 | | Dawn Allen (Incoming CFO) | 133 | 15 | 9 | 150 | - | 2,127 | 2,434 | 2024 AIP Performance vs. Targets | Performance Measure | Weighting | Target | Actual | Outcome (% of max) | | :--- | :--- | :--- | :--- | :--- | | Organic revenue growth | 60% | 5.3% | 5.0% | 47% | | Organic operating profit growth | 20% | 7.5% | 9.8% | 78.8% | 2022-2024 PSP Performance vs. Targets | Performance Measure | Weighting | Maximum Target | Actual Outcome | Vesting Level | | :--- | :--- | :--- | :--- | :--- | | Cumulative free cash flow | 50% | £5.557bn | £5.318bn | 82% | | Net debt/adjusted EBITDA | 50% | 2.4x | 2.6x | 88% | | **Overall Vesting (after discretion)** | **100%** | | | **76%** | [Consolidated Financial Statements](index=114&type=section&id=Consolidated%20Financial%20Statements) [Report of Independent Registered Public Accounting Firm](index=114&type=section&id=Report%20of%20independent%20registered%20public%20accounting%20firm) KPMG issued an unqualified opinion on the financial statements and internal controls, identifying the Preparation-H asset valuation as a critical audit matter - The auditor, KPMG LLP, issued an **unqualified opinion** on the consolidated financial statements and the effectiveness of internal control over financial reporting[794](index=794&type=chunk) - The identified critical audit matter was the **'Assessment of the recoverable amount for the Preparation H intangible asset'** due to the subjective and complex judgments involved[802](index=802&type=chunk)[803](index=803&type=chunk) [Consolidated Financial Statements Tables](index=121&type=section&id=Consolidated%20Financial%20Statements%20Tables) This section presents the core IFRS-compliant consolidated financial statements for Haleon plc for the year ended December 31, 2024 Consolidated Income Statement Summary (Year ended 31 December) | (£m) | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Revenue | 11,233 | 11,302 | 10,858 | | Gross profit | 6,824 | 6,747 | 6,577 | | Operating profit | 2,206 | 1,996 | 1,825 | | Profit before tax | 1,910 | 1,628 | 1,618 | | Profit after tax for the year | 1,475 | 1,111 | 1,119 | | Profit attributable to shareholders | 1,442 | 1,049 | 1,060 | Consolidated Balance Sheet Summary (as at 31 December) | (£m) | 2024 | 2023 | | :--- | :--- | :--- | | Total non-current assets | 28,597 | 29,237 | | Total current assets | 5,718 | 4,818 | | **Total assets** | **34,315** | **34,055** | | Total current liabilities | (5,812) | (4,640) | | Total non-current liabilities | (12,279) | (12,686) | | **Total liabilities** | **(18,091)** | **(17,326)** | | **Net assets** | **16,224** | **16,729** | | **Total equity** | **16,224** | **16,729** | Consolidated Cash Flow Statement Summary (Year ended 31 December) | (£m) | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Net cash inflow from operating activities | 2,301 | 2,100 | 2,063 | | Net cash inflow/(outflow) from investing activities | 528 | (134) | (8,784) | | Net cash (outflow)/inflow from financing activities | (1,537) | (1,568) | 6,911 | | Increase in cash and cash equivalents | 1,292 | 398 | 190 | [Notes to the Consolidated Financial Statements](index=127&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes detail accounting policies and figures, covering segment performance, intangible assets, financial risks, and legal contingencies - The financial statements are prepared on a **going concern basis**, with the Directors confident the Group can meet its requirements for at least 12 months[826](index=826&type=chunk) - A non-cash impairment charge of **£135 million was recorded for the Nexium brand** due to challenging market conditions[963](index=963&type=chunk)[964](index=964&type=chunk) - The Group is not a party to any Zantac claims and has **rejected indemnification requests from GSK and Pfizer**[1046](index=1046&type=chunk)[1047](index=1047&type=chunk) - On December 27, 2024, Haleon increased its equity interest in its China OTC joint venture (TSKF) to **88% for a consideration of £486 million**[1163](index=1163&type=chunk)[1164](index=1164&type=chunk) [Other Information](index=189&type=section&id=Other%20Information) [Directors' Report](index=191&type=section&id=Directors'%20Report) This report provides statutory information on share capital, dividends, significant shareholders, and energy and carbon reporting - The company purchased a total of **181,212,949 ordinary shares in 2024**, utilizing both on-market and off-market buyback authorities[1206](index=1206&type=chunk) Significant Shareholders (as of latest disclosure) | Shareholder | % of Issued Share Capital | | :--- | :--- | | Blackrock, Inc. | 5.22% | | Pfizer, Inc. | 7.31% | | Wellington Management Group LLP | 5.10% | 2024 Streamlined Energy and Carbon Reporting (Global) | Metric | Value | | :--- | :--- | | Total Scope 1 & 2 GHG emissions (location-based) | 192,000 tonnes CO2e | | Total net Scope 1 & 2 carbon emissions (market-based) | 48,000 tonnes CO2e | | Total energy consumed | 719 GWh | [Group Information](index=196&type=section&id=Group%20information) This section details Haleon's history, key assets, internal controls, risk factors, and material contracts like the Pfizer SAPA - Haleon was formed through the combination of the consumer healthcare businesses of GSK, Novartis (2015), and Pfizer (2019), followed by a **demerger from GSK in July 2022**[1246](index=1246&type=chunk)[1247](index=1247&type=chunk) - Management has assessed the effectiveness of internal control over financial reporting as of December 31, 2024 and concluded **it is effective**[1265](index=1265&type=chunk) - Key risk factors include operating in a **highly competitive market**, **supply chain disruptions**, dependence on key retail customers, and the ability to develop and commercialize new products effectively[1268](index=1268&type=chunk)[1273](index=1273&type=chunk)[1280](index=1280&type=chunk)[1284](index=1284&type=chunk) - The Pfizer Stock and Asset Purchase Agreement (SAPA) contains cross-indemnities, under which GSK and Pfizer have sought indemnification for OTC Zantac claims, which **the Group has rejected**[1353](index=1353&type=chunk) [Shareholder Information](index=213&type=section&id=Shareholder%20information) This section outlines key shareholder data, including differences in governance vs NYSE standards, dividend history, and tax guidance - Significant differences between Haleon's UK governance and NYSE standards exist in the **definition of director independence** and the composition of board committees[1417](index=1417&type=chunk)[1418](index=1418&type=chunk)[1419](index=1419&type=chunk) Dividend History (per ordinary share) | Year | Dividend (pence) | | :--- | :--- | | 2024 (proposed) | 6.6 | | 2023 | 6.0 | | 2022 | 2.4 | - As of December 31, 2024, **institutional and corporate holders owned 69.62% of shares**, while individuals and other bodies held 12.15%[1426](index=1426&type=chunk)

[Notification of Major Holdings (TR-1 Form)](index=1&type=section&id=TR-1%3A%20Standard%20form%20for%20notification%20of%20major%20holdings) This section outlines the TR-1 form, a standard notification for significant changes in shareholdings [Issuer and Notifying Entity Details](index=1&type=section&id=1.%20Issuer%20and%20Notifying%20Entity%20Details) This section identifies Haleon plc as the UK issuer and Wellington Management Group LLP as the US notifying party, triggered by a voting rights change - Issuer: **Haleon plc** (ISIN: GB00BMX86B70), a UK issuer[4](index=4&type=chunk) - Person subject to notification: **Wellington Management Group LLP**, registered in Boston, United States[5](index=5&type=chunk) - Reason for notification: An acquisition or disposal of voting rights[4](index=4&type=chunk) [Change in Holdings and Key Dates](index=2&type=section&id=2.%20Change%20in%20Holdings%20and%20Key%20Dates) Wellington Management Group LLP's total voting rights in Haleon plc increased from 5.10% to 5.87%, crossing the threshold on March 19, 2025 - The notification threshold was crossed on **March 19, 2025**, and the issuer was notified on **March 20, 2025**[6](index=6&type=chunk) Change in Voting Rights Position | Position | % of Voting Rights Attached to Shares | % of Voting Rights through Financial Instruments | Total Voting Rights (%) | | :--- | :--- | :--- | :--- | | **Previous Notification** | 4.740000% | 0.360000% | 5.100000% | | **Resulting Situation** | 5.510000% | 0.360000% | 5.870000% | - The total number of voting rights held after the change is **532,195,657**[6](index=6&type=chunk) [Detailed Breakdown of Holdings](index=2&type=section&id=3.%20Detailed%20Breakdown%20of%20Holdings) The 5.87% total holding comprises 5.51% indirect voting rights attached to shares and 0.36% through financial instruments like Depository Receipts Breakdown of Resulting Situation (5.87%) | Holding Type | Number of Voting Rights | % of Voting Rights | | :--- | :--- | :--- | | **Voting Rights Attached to Shares (Indirect)** | 499,089,557 | 5.510000% | | **Financial Instruments (Depository Receipt)** | 32,813,454 | 0.360000% | | **Financial Instruments (Equity Swaps)** | 292,646 | 0.000000% | - The voting rights attached to shares are held indirectly[7](index=7&type=chunk) - Financial instruments include Depository Receipts and cash-settled Equity Swaps with expiration dates extending to **2033**[9](index=9&type=chunk)[10](index=10&type=chunk) [Chain of Controlled Undertakings](index=3&type=section&id=4.%20Chain%20of%20Controlled%20Undertakings) This section details the corporate structure, identifying Wellington Management Group LLP as the ultimate controlling entity through a multi-layered chain of undertakings - The ultimate controlling entity is **Wellington Management Group LLP**[11](index=11&type=chunk)[13](index=13&type=chunk)[14](index=14&type=chunk) - The holdings are managed through a full chain of controlled undertakings, including **Wellington Management Company LLP**, **Wellington Management International Ltd**, **Wellington Management Hong Kong Ltd**, and **Wellington Management Europe GmbH**[11](index=11&type=chunk)[12](index=12&type=chunk)[13](index=13&type=chunk)

Core Viewpoint - Pfizer has fully divested its stake in Haleon, selling approximately 662 million shares for around $3.3 billion, marking its exit from the consumer health sector [1][2][3]. Group 1: Pfizer's Divestment Details - Pfizer sold 618 million ordinary shares of Haleon to institutional investors for about $3.1 billion, and an additional 44.14 million shares worth approximately $220 million directly to Haleon [2]. - The sale price for Haleon shares was £3.85 per ordinary share, totaling around £2.5 billion for the shares sold to institutional investors [1]. Group 2: Haleon Background - Haleon was formed as a consumer health joint venture between Pfizer and GSK in 2019, with GSK holding a controlling stake of 68% [3]. - GSK divested its entire stake in Haleon in May 2024, while Pfizer had been gradually reducing its stake since 2022, originally holding 32% [3]. Group 3: Market Impact - Following Pfizer's divestment, BlackRock Investment Management became Haleon's largest shareholder with a 5% stake [4]. - Haleon's stock has increased by 24.5% over the past year, outperforming the industry average increase of 9.5% [6]. Group 4: Industry Trends - Several large drugmakers, including J&J and Sanofi, have been divesting their consumer health divisions to refocus on their core pharmaceutical businesses [7][8]. - J&J separated its Consumer Health business into Kenvue in 2023 and fully exited its stake in mid-2024 [7]. Sanofi plans to create a publicly listed entity called Opella for its Consumer HealthCare unit, with a transaction expected to close in Q2 2025 [8].