Unilever Plc · LSE:ULVR
Unilever — Q2 2009 Earnings Presentation
19 slides from Unilever's earnings presentation, Aug 6, 2009
Slide 1: Q2 and First Half 2009 Results
Q2 and First Half 2009 Results 6 August 2009 Paul Polman (CEO) - Jim Lawrence (CFO) - James Allison (Head of IR) Safe Harbour Statement This announcement may contain forward-looking statements, including 'forward- looking statements' within the meaning of the United States Private Securities Litigat
Slide 2: Q2 Highlights; Q2 and H1 Sales
Q2 Highlights • Underlying sales growth +4.1% • Restored volume growth +2.0% • Step up in A&P investments +50bps • Underlying operating margin down 60bps, in line with expectations • Cash flow improved €1.6bn in H1 Q2 and H1 Sales Q2 2009 H1 2009 Turnover €10.5bn €20.0bn Change 0.8% 0.1% Currency ef
Slide 3: Asia Africa CEE and Americas
Asia Africa CEE UVG 3.3% 1.3% • Most economies resilient and growing (0.9)% • Broad based volume growth Q1 Q2 H1 9.5% USG • Central Europe remains weak 8.8% 8.2% • Q2 Underlying margin up +130 bps Q1 Q2 H1 Americas UVG 1.6% • Consumer confidence remains weak 0.4% (1.0)% • Positive volume growth cont
Slide 4: Western Europe; Savoury, Dressings and Spreads
Western Europe UVG 1.0% (1.2)% • Markets remain challenging (3.7)% Q1 Q2 H1 • Positive volume trend in key countries USG • Q2 Underlying margin down (340) bps (1.1)% (1.9)% (2.8)% Q1 Q2 H1 Savoury, Dressings and Spreads Q2 H1 USG (0.2)% 1.4% 4
Slide 5: Ice Cream and Beverages; Home Care
Ice Cream and Beverages Q2 H1 USG 4.9% 4.5% Home Care Q2 H1 USG 9.2% 9.9% 5
Slide 6: Personal Care; Commodity Cost Development
Personal Care Q2 H1 USG 5.4% 4.6% Commodity Cost Development 900 Commodity Costs Currency* 800 700 600 500 bps 400 300 200 100 0 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 2009 • Commodity costs tailwinds in H2 • FY2009 commodity costs (including currency) up vs last year *Note: Before Q4 08 currency effects
Slide 7: Strong Savings Delivery
Strong Savings Delivery • €0.6bn total savings delivered in H1 Local efficiency 0.1 Restructuring 0.2 Buying 0.3 On track to deliver c. €1bn in this year Pricing • Full year price ‘carry-over’ 2-3% • Prices adjustments: – Aligning with the market where necessary – Reflecting anticipated easing of co
Slide 8: Q2 Drivers of Operating Profit; Q2 Operating Margin
Q2 Drivers of Operating Profit* 0.5 Price 0.3 Vol/Mix 0.1 Acq/Disp 0 €bn -0.1 A&P Underlying Profit -0.3 Costs Savings programme -0.5 *Excl RDIs, constant currency Q2 Operating Margin Q2 2008 Q2 2009 Change Operating margin 13.2% 12.6% (0.6)% Including RDIs* (2.0)% (2.0)% (0.0)% Operating margin bef
Slide 9: H1 Drivers of EPS Growth; Reducing Cash Conversion Cycle
H1 Drivers of EPS Growth H1 2008 H1 2009 Change EPS (€) 0.79 0.53 (33)% Includes RDIs*, after tax 0.07 (0.10) EPS before RDIs* 0.72 0.63 (13)% Key drivers (%) Dilution from disposals (3) Pensions finance charge (6) Tax rate (before RDIs*) (3) *Restructuring, disposals and one-off items Reducing Cash
Slide 10: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow • Strong cash flow delivery - up €1.6bn in H1 • Net debt €8.9bn • New bonds issued at attractive rates • Acquisitions: TiGi, Baltimor, Vietnam minorities Paul Polman Chief Executive Officer 10
Slide 11: Quality of Our Results
Quality of Our Results 9 Market share momentum in 60% of our business 9 Widespread growth across categories & countries 9 Underpinned by innovation and A&P support 9 More competitive cost structure Key drivers of business performance Cash and Costs Brands & Categories In Market Organisation Amplific
Slide 12: Stronger claims
Stronger claims Examples: US Soft Spreads Asia Pond’s Anti US Dove Body Wash Ageing Creams ‘No hydrogenated ‘Clinically proven to oils’ ‘Younger skin in 7 reverse dryness’ days’ Brands Faster roll-out to more markets Examples: 17 Markets 33 Markets 37 Markets 56 Markets 12
Slide 13: Improving product quality; Playing the full price piano
Improving product quality Examples: Brands Amora - France Klondike - US DiG - Asia Playing the full price piano Example: Russia Tea Premium • Roll-out of fruit pyramid teas Brands • New advertising Mid-Tier campaign • Launch of herbal infusions Value 13
Slide 14: Positive Customer Service Trend
Key drivers of business performance In Market Amplification Positive Customer Service Trend 20 Number of Top 20 countries achieving service at the 2009 par target level 15 10 5 0 Jan-08 Jan-09 Aug Jun Feb Sep Feb Mar Apr Mar Apr May Nov May Jul Dec Oct 14
Slide 15: Customer Insight and Innovation Center
Customer Insight and Innovation Center The Customer Insight & Innovation Centre in the US will be showcased at our Investor Event in 23-24 November 2009 Key drivers of business performance Cash and Costs 15
Slide 16: Aligning the organisation
Key drivers of business performance Organisation Aligning the organisation Accountability & Responsibility Consistent Bias for Action Winning Organisation Consumer & Customer Focus 16
Slide 17: Priorities for 2009; Questions
Priorities for 2009 1. Restore volume growth 2. Protect cash and margin for the full year Questions 17
Slide 18: Appendices: H1 Drivers of Operating Profit
Appendices H1 Drivers of Operating Profit* 0.8 Price Costs 0.6 0.4 0.2 Vol/Mix 0 €bn 0 Acq/Disp -0.2 A&P Underlying Profit -0.4 -0.6 Savings -0.8 programme *Excl RDIs, constant currency 18
Slide 19: H1 Operating Margin
H1 Operating Margin H1 2008 H1 2009 Change Operating margin 16.0% 12.8% (3.2)% Including RDIs* 0.9% (1.8)% (2.7)% Operating margin before RDIs 15.1% 14.6% (0.5)% Key drivers: Gross margin (1.0)% Overheads 0.2% A&P 0.3% Includes margin dilution from disposals of (0.3)% *Restructuring, disposals and o