Core Insights - Unilever's stock has recently declined due to a Q4 earnings miss and the unexpected departure of its CEO, which surprised analysts [1]. Company Summary - Unilever (UL) is facing challenges as its stock price has dipped following disappointing earnings results for Q4 [1]. - The sudden resignation of the CEO has added to the uncertainty surrounding the company, impacting investor sentiment [1].

Core Viewpoint - Unilever's CEO Hein Schumacher is stepping down after less than two years, with CFO Fernando Fernandez set to replace him, effective March 1, 2024 [1][2] Group 1: Leadership Changes - Hein Schumacher will leave his position as CEO and board director in March 2024, with his departure being by mutual agreement [1] - Fernando Fernandez will assume the role of CEO, while Srinivas Phatak will take over as interim CFO [4] Group 2: Company Performance and Outlook - Unilever's 2025 outlook and medium-term guidance remain unchanged following the leadership announcement [2] - The company has shown solid financial progress during 2024, with a focus on resetting its strategy under Schumacher's leadership [2][3] - Unilever's performance over the past 18 months has been strong, marked by greater focus and disciplined execution [5] Group 3: Market Reaction - Following the announcement, Unilever's shares fell approximately 1.6% by midday in London [2] - The decision to change leadership was described as unexpected, especially given the company's recent outperformance compared to peers in the consumer goods sector [4][5]

Core Insights - The individual has a strong interest in financial markets, particularly in fundamental analysis, which evaluates a company's actual results rather than price movements [1] - The focus is primarily on long-term investments in stocks and ETFs, with a preference for US companies, while also analyzing European and Chinese firms [1] - The banking sector is highlighted as a key area of interest, as it is essential for understanding the overall health of an economy [1] Investment Approach - The investment strategy is characterized by a contrarian view, indicating a willingness to go against prevailing market trends [1] - The individual emphasizes the importance of macroeconomics in investment decisions, suggesting a holistic approach to market analysis [1]

Core Insights - Unilever reported mixed Q4 2024 results, with underlying EPS exceeding expectations but revenue falling short due to foreign currency headwinds [2][3] - The company plans to spin off its ice cream business by the end of 2025, which includes brands like Ben and Jerry's and Magnum [3] Financial Performance - Underlying EPS for Q4 2024 was 2.98 pounds, slightly above the analyst estimate of 2.965 pounds, reflecting a 14.7% increase from 2.60 pounds in Q4 2023 [4] - Q4 revenue was 14.2 billion pounds, missing the anticipated 15 billion pounds, marking a slight decline of 0.1% year-over-year [4] - Operating margin improved to 18.4%, up 1.7 percentage points from 16.7% in Q4 2023 [4] - Free cash flow decreased to 6.9 billion pounds, down 2.8% from 7.1 billion pounds in Q4 2023 [4] Business Overview - Unilever operates in various segments including Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream, with a strong brand portfolio [5] - The company focuses on brand management and innovation to enhance market positioning and long-term success [5] Strategic Focus - Recent efforts have been directed towards enhancing operational efficiencies and driving growth through Power Brands, with a focus on fewer, larger innovations [6] - The Beauty & Wellbeing segment saw a 6.5% increase in underlying sales, driven by premiumization and international expansion [7] - The Personal Care segment experienced a 5.2% increase due to innovations in deodorants [7] Growth and Challenges - Home Care sector revenue rose by 2.9% despite price pressures from commodity deflation [8] - Ice Cream segment grew by 3.7%, supported by strategies aimed at its future independence [8] - Regional challenges were noted in Indonesia and China, where sales declines necessitate adaptive pricing and market strategies [10] Future Outlook - For fiscal year 2025, Unilever projects sales growth of 3% to 5%, supported by investments in brand strength and operational efficiencies [11] - The company aims for volume-led growth and plans to capitalize on innovative product extensions to capture emerging market trends [12] - Ongoing strategic acquisitions and a focus on sustainability initiatives are part of the strategy to maintain competitiveness in the consumer landscape [12]

Financial Performance - Underlying sales growth (USG) for 2024 was 4.2%, driven by a volume increase of 2.9% and price growth of 1.3%[16] - Total turnover for 2024 reached €60.8 billion, reflecting a 1.9% increase year-over-year, despite a (0.7)% impact from currency and (1.5)% from net disposals[25] - Underlying operating profit rose to €11.2 billion, marking a 12.6% increase, while the underlying operating margin improved by 170 basis points to 18.4%[24] - Free cash flow for 2024 was €6.9 billion, with a cash conversion rate of 106%[25] - Full year turnover for Unilever was €60.8 billion, with underlying sales growth (USG) of 4.2% and a turnover of €14.2 billion for Q4 2024[41] - Beauty & Wellbeing segment achieved a full year turnover of €13.2 billion, with USG of 6.5% driven by volume growth of 5.1% and price growth of 1.3%[42] - Personal Care segment reported a full year turnover of €13.6 billion, with USG of 5.2% and volume growth of 3.1%[49] - Home Care segment turnover was €12.3 billion, with USG of 2.9% and volume growth of 4.0%[55] - Foods segment turnover reached €13.4 billion, with USG of 2.6% driven by price growth of 2.4%[61] - Underlying earnings per share increased by 14.7% to €2.98, with constant underlying earnings per share up by 15.4%[88] - Net profit fell by 10.8% to €6,369 million in 2024, compared to €7,140 million in 2023[133] - Basic earnings per share decreased by 10.6% to €2.30 in 2024, down from €2.58 in 2023[134] Future Outlook - The company anticipates underlying sales growth for 2025 to be within the range of 3% to 5%, with a slower start expected due to subdued market growth[13] - The company expects a modest improvement in underlying operating margin for 2025 compared to 18.4% in 2024, with benefits anticipated in the second half of the year[14] - The company plans to separate its Ice Cream business by the end of 2025, aiming to create a world-leading entity with five of the top 10 global ice cream brands[67] Shareholder Returns - In 2024, the company returned €5.8 billion to shareholders through dividends and share buybacks, with a quarterly interim dividend for Q4 raised to €0.4528, up 6.1% compared to Q4 2023[36] - The company completed a €1.5 billion share buyback program in November and announced a new share buyback of up to €1.5 billion to be completed in the first half of 2025[37] - A new share buyback program with a market value of up to €1.5 billion is set to commence on February 13, 2025[94] Cost Management and Productivity - A productivity program was launched targeting €800 million in savings, with 4,300 full-time equivalent roles reduced by the end of 2024[30] - Restructuring costs in 2024 reached €(850) million, compared to €(499) million in 2023, as part of a company-wide productivity program affecting approximately 7,500 jobs[111] Market Performance - The Americas region reported a 5.5% underlying sales growth, with North America achieving 5.3% growth driven by strong performance in Beauty & Wellbeing[80][81] - Emerging markets generated €35.3 billion in turnover with a 4.1% underlying sales growth, while developed markets saw a 4.4% growth[75] Acquisitions and Investments - The company acquired K18, a premium biotech hair care brand, which will contribute to underlying sales growth starting February 2025[46] - Brand and marketing investment increased by 120 basis points to 15.5% of turnover, the highest level in over a decade[25] Financial Position - Net debt increased by €0.9 billion to €24.5 billion, with a net debt to underlying EBITDA ratio of 1.9x[91] - Total assets increased to €79,750 million in 2024, up 5.3% from €75,266 million in 2023[143] - Total liabilities rose to €57,195 million, an increase of 5.0% compared to €54,502 million in 2023[143] - Shareholders' equity increased to €19,990 million, up 10.4% from €18,102 million in 2023[143] Tax and Impairments - The effective tax rate for 2024 was 29.0%, up from 24.1% in 2023[113] - The company recorded an impairment charge of €127 million related to Blueair in 2024[112]

Financial Data and Key Metrics Changes - Underlying sales growth for the full year was 4.2%, driven by volume growth of 2.9% and price contribution of 1.3% [19][51] - Gross margin increased by 280 basis points to 45%, exceeding pre-COVID levels in all Business Groups except Ice Cream [16][53] - Underlying operating profit grew by 12.6% to €11.2 billion, with underlying operating margin improving by 170 basis points to 18.4% [17][57] - Underlying earnings per share were €2.98, up 14.7% [57] Business Line Data and Key Metrics Changes - Beauty & Wellbeing achieved underlying sales growth of 6.5%, with volume at 5.1% and price at 1.3% [21][116] - Personal Care had underlying sales growth of 5.2%, with volume at 3.1% and price at 2.1% [27][121] - Home Care delivered underlying sales growth of 2.9%, driven by a 4.0% increase in volume [31] - Foods grew by 2.6%, with 2.4% from price and 0.2% from volume [35] - Ice Cream saw underlying sales growth of 3.7%, with volume growth at 1.6% and price at 2.1% [39] Market Data and Key Metrics Changes - Developed markets grew underlying sales by 4.4%, with volumes up 3.3% [43] - Latin America grew by 6.0%, with positive volume growth across Brazil, Mexico, and Argentina [44] - Asia Pacific Africa had underlying sales growth of 3.1%, with India growing at 1.8% [45][46] - China experienced a mid-single digit decline, while Indonesia saw an 8.7% decline [46] Company Strategy and Development Direction - The company is focused on the Growth Action Plan (GAP) 2030, aiming for superior brand performance and market-making [79][80] - A significant portfolio shift is underway with the separation of the Ice Cream business expected by the end of 2025 [10][91] - The company is committed to sustainability, focusing on climate, nature, plastics, and livelihoods [83][84] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the need for consistent performance and highlighted the importance of the GAP in achieving this [18][95] - The company expects underlying sales growth for 2025 to be within the range of 3% to 5% [72] - Anticipated market growth is expected to improve during the year as prices increase due to higher commodity costs [73] Other Important Information - The company returned €5.8 billion in capital to shareholders through dividends and buybacks [10][68] - A new share buyback program of up to €1.5 billion was announced, set to commence immediately [76] Q&A Session Summary Question: What are the expectations for underlying sales growth in 2025? - The company expects underlying sales growth for full year 2025 to be within the multi-year range of 3% to 5% [72] Question: How is the company addressing challenges in key markets like China and Indonesia? - The company is taking decisive actions to strengthen its business in China and correcting misaligned investments in Indonesia [46][50]

FY 2024 Results Hein Schumacher & Fernando Fernandez 13 February 2025 Safe harbour statement This presentation may contain forward-looking statements, including 'forward-looking statements' within the meaning of the United States Private Securities Litigation Reform Act of 1995, concerning the financial condition, results of operations and businesses of the Unilever Group (the 'Group'). All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Words and ...

Core Insights - Unilever reported slightly weaker-than-expected sales growth for the fourth quarter and anticipates a subdued start to 2025, with expectations of recovery in the second half of the year [1][4]. Financial Performance - The company posted a 4% rise in fourth-quarter underlying sales, missing the forecast of 4.1% [2]. - Full-year underlying sales grew by 4.2%, slightly below the analyst consensus of 4.3%, while underlying operating margins were reported at 18.4%, in line with estimates [3]. - The company expects full-year sales growth for 2025 to align with its multi-year range of 3% to 5% and anticipates a modest improvement in underlying operating margin in the latter half of the year [4]. Strategic Developments - Unilever is planning to spin off its ice cream business, which includes brands like Ben & Jerry's and Magnum, through a triple listing on the Amsterdam, London, and New York exchanges [2][6]. - The demerger is on track to be completed by the end of 2025 [6]. - The company is also looking to sell several food lines with combined sales of approximately 1 billion euros ($1.04 billion) [5].

Core Viewpoint - Ben & Jerry's has filed a lawsuit against its parent company Unilever, claiming that Unilever has censored its ability to express political views, particularly regarding support for Palestinians and criticism of Donald Trump [1][2][8]. Group 1: Legal Action and Allegations - Ben & Jerry's initiated legal proceedings against Unilever in November, alleging that the company blocked it from making statements supporting Palestinians, which it claims violates a settlement agreement [1][2]. - The complaint states that Unilever has threatened to dismantle Ben & Jerry's Independent Board and intimidate its personnel, thereby undermining the company's social mission and brand integrity [3][10]. - The lawsuit was amended to include references to Donald Trump, Elon Musk, and Nelson Peltz, highlighting the influence of these figures on Unilever's decisions [4][6]. Group 2: Censorship Claims - Ben & Jerry's asserts that Unilever censored a planned statement on Inauguration Day that addressed various social issues, including minimum wage and climate change, due to its mention of Donald Trump [5][11]. - The complaint indicates that Unilever's decision to block the post was influenced by Peltz's position on the board and his public support for Trump [9][10]. - The company argues that Unilever's actions reflect a broader pattern of undermining its authority and social mission, which has historically included progressive activism [10][11]. Group 3: Company Identity and Values - Ben & Jerry's emphasizes that its identity is rooted in social justice, equality, and free speech, and it views Unilever's actions as a threat to these core values [11][12]. - The company expresses disappointment in Unilever's inability to understand its unique brand identity and the principles that have contributed to its popularity over the past four decades [12].

Group 1 - Unilever is considered a better investment option compared to Procter & Gamble at the current time [1] - Procter & Gamble is viewed as a stock that can be held comfortably under various market conditions [1]