REG - Unilever PLC - 3rd Quarter Results
26/10/2023 07:00
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RNS Number : 3838R Unilever PLC 26 October 2023
Unilever Trading Statement - Third Quarter 2023
Solid Q3 results and action plan to drive growth and unlock potential
Third Quarter 2023 Nine Months 2023
(unaudited) USG Turnover vs 2022 USG Turnover vs 2022
Unilever 5.2% €15.2bn (3.8)% 7.7% €45.8bn 0.4%
Beauty & Wellbeing 7.4% €3.1bn (4.9)% 8.5% €9.4bn 3.7%
Personal Care 8.0% €3.6bn (2.2)% 9.8% €10.5bn 3.7%
Home Care 5.3% €3.1bn (4.1)% 7.3% €9.3bn 0.5%
Nutrition 5.6% €3.2bn (2.4)% 8.7% €9.9bn (5.7)%
Ice Cream (2.8)% €2.2bn (6.5)% 2.8% €6.7bn 0.7%
Third quarter highlights
• Underlying sales growth of 5.2% with 5.8% price growth and
(0.6)% volume decline
• Underlying price growth continues to moderate as inflation
eases, with underlying volumes now positive in Beauty & Wellbeing,
Personal Care and Home Care
• Turnover decreased (3.8)% to €15.2 billion with (8.0)% from
currency and (0.6)% from disposals net of acquisitions
• Our billion+ Euro brands, accounting for 56% of Group turnover,
delivered underlying sales growth of 7.2%, with 5.7% price growth and 1.4%
volume growth, led by strong performances from Dove, Hellmann's, Rexona and
Sunsilk
• Our 2023 outlook remains unchanged with underlying sales growth
above 5% and a modest improvement in underlying operating margin
• Today we set out an action plan focused on: faster growth,
greater productivity and simplicity, powered by a stronger performance
culture. These targeted actions will address the gap between our past
performance and potential, delivering improved value creation
Chief Executive Officer statement
"Unilever is a company with strong fundamentals: a portfolio of great brands
used by 3.4 billion people each day, number one or two category positions
across 80% of its turnover, an unrivalled global footprint, and a team of
talented people.
Despite these strengths, our performance in recent years has not matched our
potential. The quality of our growth, productivity and returns have all
under-delivered.
Today we are setting out our action plan to close this gap. We will drive
faster growth by stepping up innovation and investment behind our Power
Brands; we will drive simplicity and productivity, leveraging the full
strength of our operating model; and we will sharpen our performance culture
through strong leadership and stretching goals.
I am excited about what we can achieve by delivering on these three
priorities, as we focus on unlocking Unilever's full potential in the months
and years ahead."
Hein Schumacher
Action Plan
Today we set out an action plan to drive growth and unlock potential.
Unilever is a company of many strengths, including, its category positions,
the strength of its brands, its unmatched geographic reach and talented and
passionate people. However, there has been a disconnect between these
intrinsic strengths and the quality of our performance. Remedying this
underperformance is our top priority and with Unilever's strong fundamentals
and the many opportunities across the five Business Groups, we are confident
that we can achieve that.
Improved performance comes down to three things - delivering higher-quality,
faster growth; stepping up productivity and simplicity; and, adopting a
stronger performance focus. To address these we have defined a clear action
plan that we are focusing the company on.
Faster growth
1. Focus first on 30 Power Brands - representing 70%+ of turnover
2. Drive unmissable brand superiority - addressing all elements of
consumer preference
3. Scale multi-year innovation - driving market making and
premiumisation
4. Increase brand investment and returns - focusing investment on
areas that drive impact
5. Selectively optimise the portfolio - no major or transformational
acquisitions
Productivity & simplicity
6. Build back Gross Margin - shifting from gross savings to net
productivity
7. Focus our sustainability commitments - driving impact in four
priority areas
8. Drive benefits of the new organisation - ensuring single point
accountability
Performance Culture
9. Renewed team - leading the change
10. Drive and reward outperformance - with a new reward framework
We are providing more details on each of these in this morning's CEO update
presentation. This action plan leverages Unilever's many capabilities and
looks to accelerate areas where we are already making progress. In all areas
we are focused on fewer things, done better, with greater impact.
The action plan will strengthen our performance within our multi-year
financial framework:
• Underlying sales growth of 3-5%
• Modest margin expansion
• 100% cash conversion
• Mid-teens return on invested capital
• EPS growth and an attractive dividend
• Delivering total shareholder returns in the top third of our
peer group
Appointment of new Chief Financial Officer and other executive leadership
changes
As announced separately today, Fernando Fernandez has been appointed as
Unilever's new Chief Financial Officer. Fernando, currently President of
Unilever's Beauty & Wellbeing Business Group, will replace Graeme
Pitkethly, who announced his decision to retire from the company earlier this
year. Fernando's appointment is effective from 1 January 2024 and he will join
the Board with effect from this date.
Unilever today also announced other changes to its Unilever Leadership
Executive, as set out in detail in the separate announcement available here:
https://www.unilever.com/news/press-and-media/
Outlook
Our 2023 guidance remains unchanged. We continue to expect underlying sales
growth for the full year to be above 5%, ahead of our multi-year range, with
underlying price growth continuing to moderate.
Our expectation for net material inflation (NMI) for 2023 remains unchanged at
around €2 billion. We are confident in delivering a modest improvement in
underlying operating margin for the full year, reflecting higher gross margin
and increased investment behind our brands.
Third Quarter Review: Unilever Group
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €15.2bn 5.2% (0.6)% 5.8% 0.2% (0.8)% (8.0)% (3.8)%
Nine Months €45.8bn 7.7% (0.4)% 8.1% 0.6% (2.5)% (4.9)% 0.4%
Performance
Underlying sales growth in the quarter was 5.2% with 5.8% from price and
(0.6)% from volume. Price continued to moderate as inflation eased. Underlying
volumes were positive in Beauty & Wellbeing, Personal Care and Home Care
while negative volumes continued in Nutrition and Ice Cream.
The percentage of our business winning market share* on a rolling 12
month-basis fell to 38% and remains impacted by significant net SKU reduction,
pricing dynamics, and consumer shifts in certain markets. Improving our
competitive performance is a key focus of the action plan we have set out
today.
Beauty and Wellbeing delivered 7.4% underlying sales growth with a balance of
price and volume growth, with Prestige Beauty and Health & Wellbeing
continuing to grow strongly. Personal Care grew 8.0% with 4.0% from price and
3.9% from volume driven by double-digit growth from Deodorants. Home Care
underlying sales were up 5.3% as volume turned positive to 0.4% and price grew
4.8%. Nutrition underlying sales growth was 5.6% with price growth of 9.8% but
negative volume of (3.8)% as the European market remained challenging. Ice
Cream underlying sales declined (2.8)% with a volume decline of (10.1)%, due
to consumer downtrading and unfavourable weather, particularly in Europe. This
was partially offset by price growth of 8.2%.
Emerging markets grew underlying sales 8.3% with volume growth improving to
2.6% and price growth of 5.6%. Latin America delivered underlying sales growth
of 14.0% with volumes improving further at 6.2% growth while price growth
slowed to 7.4%. South Asia grew mid-single digit with price growth slowing as
we reduced prices in Skin Cleansing and Fabric Cleaning. The Chinese market is
recovering more slowly than expected and sales declined mid-single digit in
the quarter while South East Asia grew low single-digit.
Developed markets grew 0.8%, driven by price growth of 6.3% with a volume
decline of (5.2)%. North America and Europe grew low single-digit, driven by
price. Pricing remained elevated in Europe with higher exposure to Nutrition
and Ice Cream which remain inflationary and are more impacted by consumer
downtrading. This resulted in double-digit volume decline in Europe.
Turnover declined (3.8)% to €15.2 billion which included a negative currency
impact of (8.0)% and (0.6)% from disposals net of acquisitions.
Capital allocation
On 18 October 2023 we announced the completion of the fourth and final tranche
of our €3 billion share buyback programme. The quarterly interim dividend
for the Third Quarter is maintained at €0.4268.
We also announce today that Unilever has entered into an agreement to sell
Dollar Shave Club with completion expected before the end of 2023. Unilever
will retain a minority shareholding of 35%.
*Competitiveness % Business Winning measures the aggregate turnover of the
portfolio components (country/category cells) gaining value market share as a
% of the total turnover measured by market data. As such, it assesses what
percentage of our revenue is being generated in areas where we are gaining
market share
Conference Call
Following the release of this trading statement on 26 October 2023 at 7:00 AM
(UK time), there will be a webcast at 8:30 AM available on the website
www.unilever.com/investor-relations/results-and-presentations/latest-results.
A replay of the webcast and the slides of the presentation will be made
available after the live meeting.
Third Quarter Review: Business Groups
Third Quarter 2023 Nine Months 2023
(unaudited) Turnover USG UVG UPG Turnover USG UVG UPG
Unilever €15.2bn 5.2% (0.6)% 5.8% €45.8bn 7.7% (0.4)% 8.1%
Beauty & Wellbeing €3.1bn 7.4% 3.6% 3.6% €9.4bn 8.5% 3.7% 4.6%
Personal Care €3.6bn 8.0% 3.9% 4.0% €10.5bn 9.8% 3.4% 6.1%
Home Care €3.1bn 5.3% 0.4% 4.8% €9.3bn 7.3% (1.5)% 8.9%
Nutrition €3.2bn 5.6% (3.8)% 9.8% €9.9bn 8.7% (2.6)% 11.6%
Ice Cream €2.2bn (2.8)% (10.1)% 8.2% €6.7bn 2.8% (6.9)% 10.4%
Beauty & Wellbeing
20% of Q3 turnover
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €3.1bn 7.4% 3.6% 3.6% 0.4% (2.6)% (9.4)% (4.9)%
Nine Months €9.4bn 8.5% 3.7% 4.6% 2.5% (1.5)% (5.3)% 3.7%
Beauty & Wellbeing delivered another strong performance with underlying
sales growth of 7.4%, 3.6% from price and 3.6% from volume.
Hair Care grew mid-single digit, mainly through price with strong performances
in South Asia and Latin America. Sunsilk grew double-digit helped by a
successful relaunch based on a new Activ-infusion formulation with the power
of oils, vitamins and proteins. In Japan, we launched the premium Nexxus brand
which combines professional salon heritage with molecular protein science.
Core Skin Care grew mid-single digit with strong growth from Vaseline. In
North Asia, AHC declined double-digit as we continue the channel reset for the
brand.
Prestige Beauty and Health & Wellbeing continued to grow strongly. In
Prestige, growth was driven by Dermalogica, Tatcha and Hourglass where we
launched a luxurious skin tint that also boosts hydration. In Health &
Wellbeing, Nutrafol grew strongly and Liquid IV continued to perform well with
range extensions into sugar-free and kids hydration solutions.
Personal Care
24% of Q3 turnover
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €3.6bn 8.0% 3.9% 4.0% -% (0.9)% (8.6)% (2.2)%
Nine Months €10.5bn 9.8% 3.4% 6.1% -% (0.5)% (5.1)% 3.7%
Personal Care underlying sales grew 8.0% with price growth of 4.0% and a third
consecutive quarter of volume growth, up 3.9%.
Deodorants grew double-digit driven by strong performances in Latin America
and Europe. Rexona continued its strong growth trajectory building on the
success of its 72 hour sweat and odour protection technology and Axe grew well
supported by its new fine fragrance collection.
Skin Cleansing grew mid-single digit with volumes returning to positive
growth. Lux grew strongly and in South-East Asia, we relaunched Lifebuoy based
on a new formulation with multivitamins to fight dangerous germs. The Dove
Personal Care portfolio delivered double-digit growth driven by a strong
deodorants performance.
Oral Care grew high single-digit with Pepsodent and Close Up growing
double-digit.
Home Care
20% of Q3 turnover
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €3.1bn 5.3% 0.4% 4.8% -% -% (8.9)% (4.1)%
Nine Months €9.3bn 7.3% (1.5)% 8.9% -% -% (6.3)% 0.5%
Home Care underlying sales grew 5.3%, with a return to positive volumes of
0.4% as price growth moderated to 4.8%.
Fabric Cleaning grew mid-single digit driven by Latin America and South-East
Asia. In Asia, we relaunched OMO with a formulation that is powered by
naturally derived stain removers through our Easylift ™ technology. In
Europe, pricing was offset by a volume decline. We introduced the premium OMO
ultimate liquids range, delivering our most superior stain removal that
attacks the toughest stains while being kinder to the planet.
Fabric Enhancers grew mid-single digit driven by price and strong double-digit
growth in Turkey.
Home & Hygiene grew high single-digit with strong growth from CIF and
Domestos as our new power foams, which eliminate germs in hard-to-reach
places, performed well.
The Air Wellness business declined double-digit as consumer demand remained
muted.
Nutrition
21% of Q3 turnover
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €3.2bn 5.6% (3.8)% 9.8% -% (0.3)% (7.3)% (2.4)%
Nine Months €9.9bn 8.7% (2.6)% 11.6% -% (9.1)% (4.6)% (5.7)%
Nutrition underlying sales grew 5.6%, with 9.8% price growth, offsetting lower
volume of (3.8)%, mainly driven by double-digit volume decline in Europe.
Scratch Cooking Aids grew high single-digit driven by price and positive
volumes. Growth was driven by South East Asia as well as Africa where
innovations such as Knorr stock cubes fortified with iodine and zinc help
address malnutrition.
Dressings grew high single-digit with double-digit price growth. Negative
volumes were impacted by challenging market conditions in Europe and lapping a
strong comparator in the United States. Hellmann's grew strongly as we
continued the roll-out of our vegan and flavoured mayonnaise range while
leveraging the "make taste not waste" campaign.
Unilever Food Solutions continued to perform well and grew high single-digit
with positive volume and price.
Ice Cream
15% of Q3 turnover
(unaudited) Turnover USG UVG UPG Acquisitions Disposals Currency Turnover change
Third Quarter €2.2bn (2.8)% (10.1)% 8.2% 1.1% -% (4.8)% (6.5)%
Nine Months €6.7bn 2.8% (6.9)% 10.4% 0.4% -% (2.4)% 0.7%
Ice Cream underlying sales were down (2.8)%, with price growth of 8.2% and
volume decline of (10.1)%. Volumes were impacted by consumers downtrading to
value formats and less favourable weather conditions versus last year's
summer, particularly in Europe.
In-home Ice Cream declined mid-single digit with double-digit volume decline
partially offset by price. Our volumes continued to be impacted by lower
consumption due to the discretionary nature of the category, with private
label gaining share.
Out-of-home Ice Cream grew low single-digit with positive price growth
partially offset by negative volume. Magnum's Starchaser and Sunlover limited
edition innovation continued to perform well and in South-East Asia we
launched Wall's bites under the Heart brand, with bite sized portions
promoting sharing occasions. Turkey, a large out-of-home Ice Cream market,
grew very strongly.
Third Quarter Review: Geographical Areas
Third Quarter 2023 Nine Months 2023
(unaudited) Turnover USG UVG UPG Turnover USG UVG UPG
Unilever €15.2bn 5.2% (0.6)% 5.8% €45.8bn 7.7% (0.4)% 8.1%
Asia Pacific Africa €6.6bn 6.1% 1.7% 4.3% €20.1bn 8.1% 1.3% 6.7%
The Americas €5.5bn 6.4% 2.2% 4.0% €16.5bn 9.1% 2.0% 7.0%
Europe €3.1bn 1.1% (10.7)% 13.2% €9.2bn 4.6% (8.1)% 13.8%
Third Quarter 2023 Nine Months 2023
(unaudited) Turnover USG UVG UPG Turnover USG UVG UPG
Emerging markets €9.0bn 8.3% 2.6% 5.6% €26.8bn 9.8% 1.3% 8.4%
Developed markets €6.2bn 0.8% (5.2)% 6.3% €19.0bn 4.8% (2.7)% 7.7%
North America €3.2bn 1.7% (0.2)% 1.9% €9.9bn 5.4% 1.2% 4.1%
Latin America €2.3bn 14.0% 6.2% 7.4% €6.6bn 15.5% 3.2% 11.9%
Asia Pacific Africa
43% of Q3 turnover
Underlying sales growth was 6.1% with 4.3% from price and 1.7% from volume.
South Asia grew mid-single digit as price growth slowed significantly while
volume growth was positive. China declined mid-single digit with the market
recovery slower than expected and consumer confidence remaining weak. In
South-East Asia, sales in Indonesia was broadly flat. Thailand and the
Philippines grew volume and price while Vietnam declined versus a high
comparator. Turkey delivered another quarter of broad-based, double-digit
growth with positive volume and price in a difficult and hyperinflationary
environment. Africa grew double-digit with strong price growth and volume
growth turning positive.
The Americas
36% of Q3 turnover
Underlying sales in North America grew 1.7% with 1.9% from price and (0.2)%
from volume. Growth was negatively impacted by Ice Cream which declined high
single-digit and we lapped a strong comparator in Dressings. In Beauty &
Wellbeing, high single-digit growth was driven by Prestige Beauty and Health
& Wellbeing while Personal Care sales were broadly flat.
Underlying sales growth in Latin America was 14.0%, balanced between price and
volume growth of 7.4% and 6.2% respectively. Brazil grew high single-digit
driven by volume with modest price growth. Mexico delivered another quarter of
double-digit growth, as did Argentina where market conditions remain extremely
difficult.
Europe
21% of Q3 turnover
Underlying sales growth in Europe was 1.1% with 13.2% price growth and volume
decline of (10.7)%.
The muted growth was impacted by Ice Cream which declined high single-digit
due to adverse weather coupled with lower consumption and private label share
gains. All other Business Groups grew underlying sales. Pricing remained
elevated across Business Groups with only Personal Care growing volumes.
Growth was mixed across the region with Germany and Eastern Europe growing
while France declined.
Competition Investigations
As previously disclosed, Unilever is involved in a number of ongoing
investigations by national competition authorities. These proceedings and
investigations are at different stages and concern different product markets.
Where appropriate, provisions are made and contingent liabilities disclosed in
relation to such matters.
Ongoing compliance with competition laws is of key importance to Unilever. It
is Unilever's policy to co-operate fully with competition authorities whenever
questions or issues arise. At the same time, we are vigorously defending
Unilever when we feel that allegations are unwarranted. The Group continues to
reinforce and enhance its internal competition law compliance programme on an
ongoing basis.
Dividends
The Board has declared a quarterly interim dividend for Q3 2023 of £0.3715
per Unilever PLC ordinary share or €0.4268 per Unilever PLC ordinary share
at the applicable exchange rate issued by WM/Reuters on 24 October 2023.
The following amounts will be paid in respect of this quarterly interim
dividend on the relevant payment date:
Per Unilever PLC ordinary share (traded on the London Stock Exchange): £0.3715
Per Unilever PLC ordinary share (traded on Euronext in Amsterdam): €0.4268
Per Unilever PLC American Depositary Receipt: US$0.4539
The euro and US dollar amounts above have been determined using the applicable
exchange rates issued by WM/Reuters on 24 October 2023.
US dollar cheques for the quarterly interim dividend will be mailed on
08 December 2023 to holders of record at the close of business on
17 November 2023.
The quarterly dividend calendar for the remainder of 2023 will be as follows:
Announcement Date Ex-Dividend Date Record Date Payment Date
Q3 2023 Dividend 26 October 2023 16 November 2023 17 November 2023 08 December 2023
Segment Information - Business Groups
(unaudited)
Third Quarter Beauty & Wellbeing Personal Care Home Care Nutrition Ice Cream Total
Turnover (€ million)
2022 3,267 3,677 3,216 3,328 2,358 15,846
2023 3,106 3,597 3,084 3,250 2,205 15,242
Change (%) (4.9) (2.2) (4.1) (2.4) (6.5) (3.8)
Impact of:
Acquisitions (%) 0.4 - - - 1.1 0.2
Disposals (%) (2.6) (0.9) - (0.3) - (0.8)
Currency-related items (%), of which: (9.4) (8.6) (8.9) (7.3) (4.8) (8.0)
Exchange rates changes (%) (10.6) (10.5) (12.0) (8.9) (9.3) (10.3)
Extreme price growth in hyperinflationary markets* 1.4 2.1 3.5 1.8 4.9 2.6
Underlying sales growth (%) 7.4 8.0 5.3 5.6 (2.8) 5.2
Price* (%) 3.6 4.0 4.8 9.8 8.2 5.8
Volume (%) 3.6 3.9 0.4 (3.8) (10.1) (0.6)
Nine Months Beauty & Wellbeing Personal Care Home Care Nutrition Ice Cream Total
Turnover (€ million)
2022 9,014 10,142 9,276 10,456 6,685 45,573
2023 9,343 10,515 9,325 9,861 6,733 45,777
Change (%) 3.7 3.7 0.5 (5.7) 0.7 0.4
Impact of:
Acquisitions (%) 2.5 - - - 0.4 0.6
Disposals (%) (1.5) (0.5) - (9.1) - (2.5)
Currency-related items (%), of which: (5.3) (5.1) (6.3) (4.6) (2.4) (4.9)
Exchange rates changes (%) (6.6) (6.8) (9.2) (6.0) (5.4) (6.9)
Extreme price growth in hyperinflationary markets* 1.3 1.8 3.1 1.5 3.2 2.1
Underlying sales growth (%) 8.5 9.8 7.3 8.7 2.8 7.7
Price* (%) 4.6 6.1 8.9 11.6 10.4 8.1
Volume (%) 3.7 3.4 (1.5) (2.6) (6.9) (0.4)
* Underlying price growth in excess of 26% per year in hyperinflationary
economies has been excluded when calculating the price growth in the tables
above, and an equal and opposite amount is shown as extreme price growth in
hyperinflationary markets.
Turnover growth is made up of distinct individual growth components namely
underlying sales, currency impact, acquisitions and disposals. Turnover growth
is arrived at by multiplying these individual components on a compounded basis
as there is a currency impact on each of the other components. Accordingly,
turnover growth is more than just the sum of the individual components.
Segment Information - Geographical Areas
(unaudited)
Third Quarter Asia Pacific Africa The Americas Europe Total
Turnover (€ million)
2022 7,130 5,631 3,085 15,846
2023 6,600 5,525 3,117 15,242
Change (%) (7.4) (1.9) 1.0 (3.8)
Impact of:
Acquisitions (%) - 0.6 - 0.2
Disposals (%) (0.1) (2.1) (0.1) (0.8)
Currency-related items (%), of which: (12.7) (6.4) - (8.0)
Exchange rates changes (%) (14.9) (9.9) - (10.3)
Extreme price growth in hyperinflationary markets* 2.6 3.9 - 2.6
Underlying sales growth (%) 6.1 6.4 1.1 5.2
Price* (%) 4.3 4.0 13.2 5.8
Volume (%) 1.7 2.2 (10.7) (0.6)
Nine Months Asia Pacific Africa The Americas Europe Total
Turnover (€ million)
2022 20,866 15,640 9,067 45,573
2023 20,141 16,467 9,169 45,777
Change (%) (3.5) 5.3 1.1 0.4
Impact of:
Acquisitions (%) - 1.5 - 0.6
Disposals (%) (2.4) (2.6) (2.5) (2.5)
Currency-related items (%), of which: (8.5) (2.5) (0.8) (4.9)
Exchange rates changes (%) (10.4) (5.6) (0.8) (6.9)
Extreme price growth in hyperinflationary markets* 2.2 3.3 - 2.1
Underlying sales growth (%) 8.1 9.1 4.6 7.7
Price* (%) 6.7 7.0 13.8 8.1
Volume (%) 1.3 2.0 (8.1) (0.4)
* Underlying price growth in excess of 26% per year in hyperinflationary
economies has been excluded when calculating the price growth in the tables
above, and an equal and opposite amount is shown as extreme price growth in
hyperinflationary markets.
Non - GAAP measures
In our financial reporting we use certain measures that are not defined by
generally accepted accounting principles (GAAP) such as IFRS. We believe this
information, along with comparable GAAP measurements, is useful to investors
because it provides a basis for measuring our operating performance, and our
ability to retire debt and invest in new business opportunities. Our
management uses these financial measures, along with the most directly
comparable GAAP financial measures, in evaluating our operating performance
and value creation. Non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information presented in
compliance with GAAP. Wherever appropriate and practical, we provide
reconciliations to relevant GAAP measures. The non-GAAP measures used in this
announcement are underlying sales growth, underlying volume growth and
underlying price growth (see below).
Underlying sales growth (USG)
Underlying sales growth (USG) refers to the increase in turnover for the
period, excluding any change in turnover resulting from acquisitions,
disposals, changes in currency and price growth in excess of 26% in
hyperinflationary economies. Inflation of 26% per year compounded over three
years is one of the key indicators within IAS 29 to assess whether an economy
is deemed to be hyperinflationary. We believe this measure provides valuable
additional information on the underlying sales performance of the business and
is a key measure used internally. The impact of acquisitions and disposals is
excluded from USG for a period of 12 calendar months from the applicable
closing date. Turnover from acquired brands that are launched in countries
where they were not previously sold is included in USG as such turnover is
more attributable to our existing sales and distribution network than the
acquisition itself. The reconciliation of changes in the GAAP measure turnover
to USG is provided on page 8 and 9.
Underlying price growth (UPG)
Underlying price growth (UPG) is part of USG and means, for the applicable
period, the increase in turnover attributable to changes in prices during the
period. UPG therefore excludes the impact to USG due to (i) the volume of
products sold; and (ii) the composition of products sold during the period. In
determining changes in price we exclude the impact of price growth in excess
of 26% per year in hyperinflationary economies as explained in USG above. The
measures and the related turnover GAAP measure are set out on page 8 and 9.
Underlying volume growth (UVG)
Underlying volume growth (UVG) is part of USG and means, for the applicable
period, the increase in turnover in such period calculated as the sum of (i)
the increase in turnover attributable to the volume of products sold; and (ii)
the increase in turnover attributable to the composition of products sold
during such period. UVG therefore excludes any impact on USG due to changes in
prices. The measures and the related turnover GAAP measure are set out on page
8 and 9.
Cautionary Statement
This announcement may contain forward-looking statements within the meaning of
the securities laws of certain jurisdictions, including 'forward-looking
statements' within the meaning of the United States Private Securities
Litigation Reform Act of 1995. Words and terminology such as 'will', 'aim',
'expects', 'anticipates', 'intends', 'looks', 'believes', 'vision', 'will
continue', 'should', 'would be', 'seeks', or the negative of these terms and
other similar expressions of future performance or results, and their
negatives, are intended to identify such forward-looking statements.
Forward-looking statements also include, but are not limited to, statements
and information regarding the Unilever Group's (the 'Group') emissions
reduction targets and other climate change related matters (including actions,
potential impacts and risks associated therewith). These forward-looking
statements appear in a number of places throughout this document and are based
upon the intentions, beliefs, current expectations and assumptions regarding
anticipated developments and other factors affecting the Group. By their
nature, forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may not occur in
the future. They are not historical facts, nor are they guarantees of future
performance or outcomes.
Because these forward-looking statements involve risks and uncertainties,
there are important factors that could cause actual results to differ
materially from those expressed or implied by these forward-looking
statements. In addition, even if the results are consistent with the
forward-looking statements contained in this announcement, those results may
not be indicative of results in subsequent periods. Among other risks and
uncertainties, the material or principal factors which could cause actual
results to differ materially are: Unilever's global brands not meeting
consumer preferences; Unilever's ability to innovate and remain competitive;
Unilever's investment choices in its portfolio management; the effect of
climate change on Unilever's business; Unilever's ability to find sustainable
solutions to its plastic packaging; significant changes or deterioration in
customer relationships; the recruitment and retention of talented employees;
disruptions in our supply chain and distribution; increases or volatility in
the cost of raw materials and commodities; the production of safe and high
quality products; secure and reliable IT infrastructure; execution of
acquisitions, divestitures and business transformation projects; economic,
social and political risks and natural disasters; financial risks; failure to
meet high and ethical standards; and managing regulatory, tax and legal
matters. A number of these risks have increased as a result of the
Russia/Ukraine war. These forward-looking statements speak only as of the date
of this document. Except as required by any applicable law or regulation, the
Group expressly disclaims any intention or obligation or undertaking to
release publicly any updates or revisions to any forward-looking statements
contained herein to reflect any change in the Group's expectations with regard
thereto or any change in events, conditions or circumstances on which any such
statement is based. All subsequent written and oral forward-looking statements
attributable to either the Group or to persons acting on its behalf are
expressly qualified in their entirety by the cautionary statements referred to
above. Further details of potential risks and uncertainties affecting the
Group are described in the Group's filings with the London Stock Exchange,
Euronext Amsterdam and the US Securities and Exchange Commission, including in
the Annual Report on Form 20-F 2022 and the Unilever Annual Report and
Accounts 2022.
Enquiries
Media: Media Relations Team Investors: Investor Relations Team
UK '+44 78 2527 3767 lucila.zambrano@unilever.com investor.relations@unilever.com
or '+44 77 7999 9683 jonathan.sibun@teneo.com
NL '+31 62 375 8385 marlous-den.bieman@unilever.com
or '+31 61 500 8293 fleur-van.bruggen@unilever.com
After the conference call on 26 October 2023 at 8:30 AM (UK time), the webcast
of the presentation will be available at
www.unilever.com/investor-relations/results-and-presentations/latest-results.
This Results Presentation has been submitted to the FCA National Storage
Mechanism and is available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
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