Unilever Plc · LSE:ULVR
Unilever — H1 2017 Earnings Presentation
24 slides from Unilever's earnings presentation, Jul 20, 2017
Slide 1: Unilever First Half 2017 Results
Unilever First Half 2017 Results Paul Polman / Graeme Pitkethly 20th July 2017
Slide 2: Safe Harbour Statement
SAFE HARBOUR STATEMENT This announcement may contain forward-looking statements, including ‘forward-looking statements’ within the meaning of the United States Private Securities Litigation Reform Act of 1995, including statements related to underlying sales growth and underlying operating margin. W
Slide 3: Paul Polman
Paul Polman woes NEW POWERGEMS TRIPLE POWER TO REMOVE STAINS, CARE & FRESHEN ULTIMATE POWERGEMS
Slide 4: Delivering against our long-term growth model
Delivering against our long-term growth model Connected 4 Growth is accelerating performance: Increased agility & resilience Continued growth ahead of our markets Step-up in profitability Sustainable investment-led business model: Compounding returns on investment Attractive & growing divi
Slide 5: Challenging market conditions
Challenging market conditions Consumer demand Emerging market currencies Short-term remains weak more stable trade disruption vs. USD rebased to 100 110 H1’2017 India Market value growth Indonesia GST +2% in India Brazil Calendar De-stocking effects in in Brazil Indonesia 90 June ‘16 June ‘17
Slide 6: Good all-round performance – Connected Growth delivering
Good all-round performance – Connected 4 Growth delivering Competitive growth Savings ahead of plan Unilever Unilever excl. spreads >€1 billion in H1’2017 3.4% 3.0% H1 USG H1 market growth Profitable growth Strong cash delivery Underlying Underlying +€0.6 bn €1.4 bn Operating Margin Earnings Per Sha
Slide 7: C4G: a simpler, faster organisation
C4G: a simpler, faster organisation 2011-2016 From 2017 4 Global Categories Connected 4 Growth Already delivering results: PC HC Foods Refresh More Global: PC HC Foods & Refresh Number of global projects -10% Size of new global projects +20% 8 Cluster teams More Local: CCBTs CCBTs CCBTs Number of lo
Slide 8: Differentiated technology
Differentiated technology Persil Powergems Signal Enamel Repair Magnum Double 100% active ingredients Regenerate technology Magnum 16% growth H1’17
Slide 9: White space expansion
White space expansion Hijab fresh Baby Dove Dermalogica New segment Launching in China Omo TRESemmé Grom New brand launch Launching in Iran Launching in China In-home launch
Slide 10: Local agility
Local agility Lux Botanifique Breyers delights Liquid bouillons Cif spray and mousse Accelerated for summer Launched in 8 months Omo black Dove Sakura variant Meeting local trends Launched in 2 months Launched in 4 months Launched in 5 months
Slide 11: Value-creating M&A, faster pace of change
Value-creating M&A, faster pace of change Clear criteria for acquisitions Strategic fit: Financial discipline: • Extending into new segments or channels • DCF yield > WACC • Or, building scale & realising synergies • ROIC / WACC cross over 80% of investment 2009 to 2015 meeting/ exceeding target fin
Slide 12: Investment to build new channels
Investment to build new channels E-commerce Beauty Out-of-home Grocery.com Market place Mass Prestige Pureplay Direct 40% growth, ahead of the market Drugstores growing 2x faster Retail stores growing at 15-20% Building capability in all models Building scale in prestige Building equity with 1300 re
Slide 13: Graeme Pitkethly
NEW POWERGEMS TRIPLE POWER TO REMOVE STAINS, CARE & FRESHEN ULTIMATE POWERGEMS
Slide 14: H1 2017 – All categories growing and improving margins
H1 2017 – All categories growing and improving margins Personal Care Home Care Foods Refreshment Growth 0.6% 2.6% 3.3% 6.1% 2.0% ex. spreads Margin +240 bps +110 bps +100 bps +230 bps • Personal Care: Innovation and re-investment of savings back-weighted • Home Care: Good growth despite a strong com
Slide 15: H1 2017 – growth by region
H1 2017 – growth by region Asia / AMET / RUB Latin America North America Europe €12.1 bn €4.2 bn €4.8 bn €6.6 bn USG 5.5% USG 5.0% USG 0.3% USG (0.8)% UVG 0.8% UVG (1.0)% UVG (0.2)% UVG (0.6)% Excl spreads: Excl spreads: USG 0.9% USG 0.1% UVG 0.3% UVG 0.2%
Slide 16: H1 2017 - Turnover up 5.5%
H1 2017 - Turnover up 5.5% USG +3.0% +1.7% 0.8% 0.0% 3.0% €27.7 bn €26.3 bn H1 2016 UVG UPG M&A FX H1 2017 turnover turnover
Slide 17: Update on savings programmes
Update on savings programmes Half 1 delivery Operational KPIs – examples > €1 billion savings B&MI vs. 2016 Overheads > €200m Absolute agency fees -17% Brand & Production cost of TV ads -14% > €300m Marketing Overheads Number of airline flights -30% > €500m Supply Chain Middle & Senior managers -13%
Slide 18: H1 2017 - Underlying Operating Margin up 180 bps
H1 2017 - Underlying Operating Margin up 180 bps +10bps +130bps 17.8% +40bps +30bps 16.0% H1 2016 Gross Margin Brand & Marketing Overheads H1 2017 Investment
Slide 19: H1 2017: Underlying Earnings Per Share
H1 2017: Underlying Earnings Per Share Underlying EPS up 11.8% at constant rates (1.5%) +3.1% (1.7%) +14.4% (3.7%) 0.4% 2.6% +16.9% €1.13 €1.82 €0.99 H1 2016 Operational JVs, associates, Tax Financing, Currency H1 2017 performance other income, number of minorities shares
Slide 20: Cash flow & balance sheet
Cash flow & balance sheet Free cash flow Inventory Net debt Pension deficit Average inventory days € billion € billion €1.4bn -2 13.8 +€600m days 12.6 3.2 vs. H1’16 1.6 +€1.2bn excl. pensions injection Last 12 months Dec-16 Jun-17 Dec-16 Jun-17 • Dividend increased by 12% as announced in April • €0.
Slide 21: Paul Polman
Paul Polman woes NEW POWERGEMS TRIPLE POWER TO REMOVE STAINS, CARE & FRESHEN ULTIMATE POWERGEMS
Slide 22: Strong innovation plan in the second half
Strong innovation plan in the second half
Slide 23: 2017 outlook
2017 outlook Ahead of our markets, 3-5% underlying sales growth Underlying operating margin now expected to be up at least 100bps Strong cash flow
Slide 24: Unilever First Half 2017 Results
Unilever First Half 2017 Results Paul Polman / Graeme Pitkethly 20th July 2017