Unilever(UK)(US:UL)2026-02-17 19:02Unilever Conference Call Summary Company Overview - Company: Unilever - Business Size: Approximately €51 billion with a 20% operating margin and over €10 billion in underlying operating profit [4][62] - Global Presence: Operates in 185 countries, serving 3.7 billion consumers daily [4] Key Changes and Strategic Focus - Leadership Changes: New CEO and CFO have been appointed, leading to a refreshed strategic direction [1][18] - Portfolio Simplification: Transitioned from a geographically-led model to a category-led organization, rotating 15% of the portfolio, including the demerger of the ice cream business [5][6] - Volume Growth Focus: Volume growth is now the primary metric for success, contrasting with past inconsistencies [5][6] - Investment in Brands: Competitive investment levels in brands have been restored, with 16% of revenue allocated to brand marketing [12][17] Market and Growth Strategy - Target Categories: Increased focus on beauty, personal care, and wellness, which now constitute 51% of the portfolio, with a goal to reach two-thirds [7][8] - Geographical Focus: The U.S. and India are identified as key markets, currently representing 33% of the business, with plans to increase this to 45% [8][9] - U.S. Market Strategy: The U.S. is seen as a critical market for building a scalable business and international brand portfolio [9][32] Financial Performance - Cash Flow: Achieved €6 billion in cash flow last year, with a 100% cash conversion rate [4] - Shareholder Returns: €6 billion returned to shareholders over the past two years, split 75% dividends and 25% share buybacks [4] - Gross Margin Improvement: Expanded gross margin by 460 basis points, with two-thirds of this increase reinvested into brand marketing [12][13] Innovation and Marketing - Innovation Strategy: Focus on superior science and aesthetics in product development, with significant investment in R&D [19][20] - Digital and Social Media Engagement: Increased content creation and engagement through social media, with 180,000 content creators in the beauty division [25][26] - Consumer Engagement: Shift towards a more community-driven marketing model, leveraging partnerships and cultural relevance [37][38] India Market Insights - Market Potential: India is projected to be the third-largest market globally, with significant growth opportunities [44][45] - Market Leadership: Unilever holds leading positions in various categories, with 85% of the business being number one in its segments [45] - Digital Transformation: Rapid digitization and a shift towards premium products are driving growth in India [46][47] Future Outlook - Growth Projections: Anticipated USG between 4%-6% for the upcoming year, with a focus on outperforming market growth [62] - Continued Investment: Plans for a €1.5 billion share buyback to enhance shareholder value [62] - Long-term Strategy: Emphasis on maintaining a leaner, stronger business model while leveraging emerging market advantages [63]