2023 Full Year
Results
Implementing Growth Action Plan at pace
|
Underlying performance
|
|
|
|
GAAP
measures
|
(unaudited)
|
2023
|
vs 2022
|
|
|
|
|
2023
|
vs 2022
|
Full Year
|
|
|
|
|
|
|
|
|
Underlying sales growth
(USG)
|
|
7.0%
|
|
|
|
Turnover
|
€59.6bn
|
(0.8)%
|
Beauty & Wellbeing
|
|
8.3%
|
|
|
|
Beauty & Wellbeing
|
€12.5bn
|
1.8%
|
Personal Care
|
|
8.9%
|
|
|
|
Personal Care
|
€13.8bn
|
1.4%
|
Home Care
|
|
5.9%
|
|
|
|
Home Care
|
€12.2bn
|
(1.8)%
|
Nutrition
|
|
7.7%
|
|
|
|
Nutrition
|
€13.2bn
|
(5.0)%
|
Ice Cream
|
|
2.3%
|
|
|
|
Ice Cream
|
€7.9bn
|
0.5%
|
Underlying operating
profit
|
€9.9bn
|
2.6%
|
|
|
|
Operating profit
|
€9.8bn
|
(9.3)%
|
Underlying operating
margin
|
16.7%
|
60bps
|
|
|
|
Operating margin
|
16.4%
|
(150)bps
|
Underlying earnings per
share
|
€2.60
|
1.4%
|
|
|
|
Diluted earnings per
share
|
€2.56
|
(14.2)%
|
Free cash flow
|
€7.1bn
|
€1.9bn
|
|
|
|
Net profit
|
€7.1bn
|
(13.7)%
|
Fourth Quarter
|
|
|
|
|
|
|
|
|
USG
|
|
4.7%
|
|
|
|
Turnover
|
€14.2bn
|
(3.0)%
|
Quarterly dividend payable in March
2024
|
|
|
|
€0.4268
|
per share (a)
|
(a) See note 11 for more information
on dividends
Financial and operational
highlights
• Underlying sales growth of
7.0% with positive volumes, up 0.2%
for the FY and 1.8% in Q4
• Turnover of €59.6
billion with (5.7)% impact from
currency and (1.7)% from net disposals
• Underlying operating margin up
60bps to 16.7%, with gross margin up
200bps for the year and up 330bps in the second half
• Underlying EPS increased
1.4% with (9.6)% of adverse
currency, up 11% on a constant basis
• Diluted EPS down
(14.2)% against prior year that
included €2.3 billion profit on disposal for the Tea
business
• Strong cash conversion of
111% with free cash flow up €1.9
billion to €7.1 billion
• New €1.5 billion share
buyback to commence in Q2
• Progress against Growth Action
plan, including:
• New leadership team has embedded the plan across the
organisation
• 30 Power Brands (~75% of turnover) accretive to growth and
margin, with underlying sales up 8.6%
• Brand and marketing investment up 130bps to 14.3%, focused on
30 Power Brands
• Active portfolio optimisation into premium segments, announced
acquisitions of K18 and Yasso and disposals of Elida Beauty, Dollar
Shave Club, Suave in North America
Chief Executive Officer
statement
"Today's results show an improving
financial performance, with the return to volume growth and margins
rebuilding. However, our competitiveness remains disappointing and
overall performance needs to improve. We are working to address
this by improving our execution to unlock Unilever's full
potential.
In October, we set out a Growth
Action Plan focused on three priorities: delivering higher-quality
growth, stepping up productivity and simplicity, and adopting a
strong performance focus.
The new leadership team has embedded
the action plan at pace. We have increased investment behind our 30
Power Brands, accelerated portfolio transformation, and are driving
a sharper performance focus with clear and stretching targets
across the whole organisation.
We are at the early stages of this
work and there is much to do but we are moving with speed and
urgency to transform Unilever into a consistently higher performing
business."
Hein Schumacher
We expect underlying sales growth
(USG) for 2024 to be within our multi-year range of 3% to 5%, with
more balance between volume and price.
We anticipate a modest improvement
in underlying operating margin for the full year. We will deliver
this through gross margin expansion, driven by a step-up in
productivity and net material inflation back to more normal
levels.
Growth
Action Plan Update
|
In October 2023, we set out a Growth
Action Plan to drive improved performance and competitiveness.
During the fourth quarter, we moved at pace to embed it across the
business.
The plan is divided into three
elements but is underpinned by one simple premise: the need to do
fewer things, better, with greater impact. The operational impacts
will build throughout 2024.
Faster
growth
1.
Focus on 30 Power Brands:
These gross margin accretive brands represented around 75% of Group
turnover with underlying sales growth of 8.6% in 2023 and 6.5% in
the fourth quarter. This is where we have concentrated our
incremental brand and marketing investment, which will continue in
2024.
2.
Drive unmissable brand
superiority: We developed a new quantitative methodology to
measure brands' consumer appeal across multiple dimensions and have
validated it in 29 strategic cells. During the first half of 2024,
this will be rolled out across all 30 Power Brands in key
geographies to identify performance gaps and improve
competitiveness.
3.
Scale multi-year
innovation: We have identified multi-year, scalable
innovation programmes to drive market development and
premiumisation. The programmes at least double the average 2022
project size, with launches from 2025.
4.
Increase brand investment and
returns: In 2023, we reinvested more than half of our gross
margin expansion into incremental brand and marketing investment,
up 130bps to 14.3%. We will continue to step up investment in areas
that drive impact and support improved competitiveness.
5.
Selectively optimise the
portfolio: We continue to reshape the portfolio, with the
announced acquisitions of Yasso and K18 and the disposals of Elida
Beauty, Dollar Shave Club and Suave.
Productivity &
simplicity
6.
Build back gross margin: We
accelerated recovery in the second half of 2023 with a 330bps gross
margin improvement, driving a 200bps improvement for the year to
42.2%. In 2024, a tight grip on costs, measured by improved net
productivity, will fuel further gross margin expansion.
7.
Focus our sustainability
commitments: We are honing our sustainability efforts around
four critical platforms: Climate, Plastic, Nature and Livelihoods.
We have set exacting, short-term targets, to drive progress against
our longer-term commitments.
8.
Drive benefits of the
organisation: The category-focused Business Groups are now
fully implemented with end-to-end responsibility for strategy and
performance. In 2024, this will enable sharper choices to
accelerate growth and digitalisation.
Performance
culture
9.
Renewed team: Since
October, over half of our executive leadership team has changed.
Our new leaders are addressing the 2024 opportunities and
challenges with urgency and decisiveness.
We are announcing today that our
Chief People & Transformation Officer Nitin Paranjpe has
decided to retire from Unilever later this year. Nitin has had a
distinguished 37-year career with Unilever, including as CEO of
Hindustan Unilever, President Home Care, President Foods &
Refreshment and Chief Operating Officer of Unilever. We are pleased
to announce the appointment of Mairéad Nayager as our new Chief
People Officer, effective 1 June. Mairéad is currently Chief Human
Resources Officer (CHRO) of Haleon PLC, having previously served as
CHRO of Diageo PLC between 2015 and 2022.
10. Drive and reward outperformance: We
have implemented a new reward framework across the organisation
with metrics more closely aligned to value creation. A new
Directors' remuneration policy proposal has been extensively
consulted on with our largest shareholders and will be voted on at
the 2024 AGM.
Full Year
Review: Unilever Group
|
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€59.6bn
|
7.0%
|
0.2%
|
6.8%
|
(1.7)%
|
(5.7)%
|
(0.8)%
|
16.7%
|
60bps
|
Fourth Quarter
|
€14.2bn
|
4.7%
|
1.8%
|
2.8%
|
(0.7)%
|
(6.7)%
|
(3.0)%
|
|
|
Performance
Underlying sales growth in the full
year was 7.0%, with positive volumes of 0.2% and 6.8% from price.
Growth from the 30 Power Brands was accretive at 8.6%. Beauty &
Wellbeing and Personal Care delivered strong volume growth
throughout the year and Home Care returned to positive volume
growth in the second half. Volume growth for the Group accelerated
to 1.8% in the fourth quarter, with 3.9% volume growth from the 30
Power Brands.
Underlying price growth decelerated
from 10.7% in the first quarter to 2.8% in the fourth quarter,
reflecting lower net material inflation in the second half.
Nutrition and Ice Cream faced the highest input cost inflation in
2023 which translated into higher pricing.
The percentage of our business
winning market share* on a rolling 12 month-basis was disappointing
at 37%. This poor performance reflects share losses to private
label in Europe, consumer shifts to super-premium segments in North
America where we currently under index and a significant reduction
of unprofitable SKUs globally. Our competitiveness is not good
enough and we are moving quickly to address it.
Beauty & Wellbeing grew
underlying sales by 8.3%, with strong volume growth of 4.4%.
Prestige Beauty and Health & Wellbeing continued to grow
double-digit and now account for a quarter of Beauty &
Wellbeing's turnover. Personal Care grew underlying sales 8.9%,
with 3.2% from volume and 5.5% from price, led by strong sales
growth of Deodorants. Home Care grew underlying sales 5.9%, driven
by 6.8% from price and (0.9)% from volume, with positive volumes in
emerging markets offset by a double-digit decline in Europe.
Nutrition grew underlying sales 7.7%, with 10.1% from price and
volumes down (2.2)% as we responded to higher input costs and a
challenging European market. Ice Cream's underlying sales growth
was disappointing at 2.3%, with price growth of 8.8% and a volume
decline of (6.0)%, reflecting the impact of downtrading in the
in-home channels.
Emerging markets (58% of Group
turnover) grew underlying sales 8.5%, with 1.6% from volume and
6.9% from price. Latin America, Turkey and Africa delivered
double-digit growth. India grew mid-single digit led by volume,
with lower input costs that led to negative pricing in the fourth
quarter. Sales in China grew low-single digit led by volume while
the market recovery continued to be uneven and slower than
expected. Growth in South East Asia was impacted by a sales decline
in Indonesia in the fourth quarter as consumers avoided the brands
of multinational companies in response to the geopolitical
situation in the Middle East.
Underlying sales in developed
markets (42% of Group turnover) grew 4.8% in the full year with
6.7% from price and (1.8)% from volume. North America delivered
strong growth of 5.8% with 2.5% from volume and 3.3% from price,
with continued double-digit underlying sales growth in Prestige
Beauty and Health & Wellbeing. Volume growth in North America
accelerated throughout the year leading to volume growth of 6.3% in
the fourth quarter. In Europe, underlying sales growth was
4.1%, driven by 12.8% from price given its higher exposure to
categories with significant cost inflation, and a volume decline of
(7.7)%.
Turnover was €59.6 billion, down
(0.8)% versus the prior year, including (5.7)% adverse foreign
exchange translation and (1.7)% from disposals net of acquisitions.
Underlying operating profit was €9.9 billion, up 2.6% versus the
prior year. Underlying operating margin increased 60bps to 16.7%.
We improved gross margin by 200bps to 42.2% with an improvement of
330bps in the second half. We more than mitigated net material
inflation of around €1.8 billion through improved productivity,
price and mix while stepping up brand and marketing investment by
€0.7 billion, a 130bps increase as a percentage of turnover.
Overheads increased by 10bps, as we continued to invest in the
expansion of our Prestige Beauty and Health & Wellbeing
businesses.
Capital allocation
We continue to reshape the
portfolio, allocating capital to premium segments through selective
bolt-on acquisitions and divesting lower-growth businesses while
balancing investment in the business and shareholder
returns.
Adding to our portfolio of premium
brands, we announced the acquisitions of Yasso Holdings, Inc., a
premium frozen Greek yogurt brand in the United States, which
completed on 1 August, and K18, a premium biotech haircare brand,
which completed on 1 February 2024.
We announced three disposals during
the year: the Suave beauty and personal care brand in North
America, which completed on 1 May; Dollar Shave Club, which
completed on 1 November; and Elida Beauty, which comprises more
than 20 personal care brands. It is expected to complete by
mid-2024.
In 2023, we returned €5.9 billion to
shareholders through dividends and share buybacks. We completed the
final two €750 million tranches of our €3 billion share buyback
programme. The quarterly interim dividend for the Fourth Quarter is
maintained at €0.4268.
Reflecting the Group's continued
strong cash generation, the Board has approved a share buyback
programme of up to €1.5 billion to be conducted during 2024, which
we expect to commence in the second quarter.
*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
Following the release of this
trading statement on 8 February 2024 at 7:00 AM (UK time), there
will be a webcast at 8:00 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.
Full Year
Review: Business Groups
|
|
Full Year
2023
|
Fourth
Quarter 2023
|
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
UOM
|
Change in
UOM
|
Turnover
|
USG
|
UVG
|
UPG
|
Unilever
|
€59.6bn
|
7.0%
|
0.2%
|
6.8%
|
16.7%
|
60bps
|
€14.2bn
|
4.7%
|
1.8%
|
2.8%
|
Beauty & Wellbeing
|
€12.5bn
|
8.3%
|
4.4%
|
3.8%
|
18.7%
|
0bps
|
€3.2bn
|
7.9%
|
6.3%
|
1.5%
|
Personal Care
|
€13.8bn
|
8.9%
|
3.2%
|
5.5%
|
20.2%
|
60bps
|
€3.4bn
|
6.4%
|
2.5%
|
3.8%
|
Home Care
|
€12.2bn
|
5.9%
|
(0.9)%
|
6.8%
|
12.3%
|
150bps
|
€3.0bn
|
1.7%
|
0.8%
|
0.9%
|
Nutrition
|
€13.2bn
|
7.7%
|
(2.2)%
|
10.1%
|
18.6%
|
100bps
|
€3.4bn
|
4.7%
|
(1.1)%
|
5.9%
|
Ice Cream
|
€7.9bn
|
2.3%
|
(6.0)%
|
8.8%
|
10.8%
|
(90)bps
|
€1.2bn
|
(0.4)%
|
(0.8)%
|
0.4%
|
Beauty & Wellbeing
(21% of Group turnover)
In
Beauty & Wellbeing, we are focused on three key priorities that
will drive the unmissable superiority of our brands: elevating our
core Hair Care and Skin Care brands to increase premiumisation;
fuelling the growth of Prestige Beauty and Health & Wellbeing
with selective international expansion; and continuing to
strengthen our beauty and wellbeing capabilities.
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€12.5bn
|
8.3%
|
4.4%
|
3.8%
|
0.1%
|
(6.2)%
|
1.8%
|
18.7%
|
0bps
|
Fourth Quarter
|
€3.2bn
|
7.9%
|
6.3%
|
1.5%
|
(2.1)%
|
(7.5)%
|
(2.3)%
|
|
|
Beauty & Wellbeing delivered a
strong full year performance, with underlying sales up 8.3%,
balanced between volume at 4.4% and price
at 3.8%. Volume growth accelerated through
the year to 6.3% in the fourth quarter, with good volumes in Hair
Care and very strong volumes in Health & Wellbeing.
The full year performance reflects
continued strong growth in Prestige Beauty and Health &
Wellbeing, which now account for a quarter of Beauty &
Wellbeing's turnover, as well as successful relaunches of some of
our core Hair Care and Skin Care brands. The relaunches were
powered by our science and technology capabilities and were
supported by increased investment across our key markets to elevate
their superiority credentials.
Hair Care grew mid-single digit
through a combination of price and volume growth, with strong
growth in Latin America and Turkey. Sunsilk delivered double-digit growth
for the year following a successful relaunch of the brand.
Clear delivered mid-single
digit growth driven by breakthrough innovation - our first
clinically proven anti-dandruff formula powered by niacinamide
concentrate to repair and strengthen the scalp's skin barrier.
Following the successful relaunch in China last year, the mix has
now been expanded to Thailand, Turkey and Brazil.
Core Skin Care grew low-single digit
driven by price. Vaseline
delivered double-digit growth, reaching €1 billion of turnover in
2023. Following the launch of our successful Gluta-Hya range in
South East Asia two years ago, we further expanded the platform
with the launch of serums and a Pro-Age range, tapping into a
larger consumer pool by extending the patented technology to more
products and new markets such as India. In North Asia, AHC declined double-digit as we reset
the cross-border trade channel.
Our US-centric Prestige Beauty and
Health & Wellbeing portfolios, built over several years through
carefully selected bolt-on acquisitions, continued to grow ahead of
the market delivering double-digit growth for the year. This was
supported by strong performances from Hourglass, Dermalogica and Paula's Choice which launched a Vitamin
C range, using our core science and technology capabilities. In
Health & Wellbeing, Liquid
I.V. and Nutrafol
performed strongly. Liquid
I.V. added sugar-free and kids variants to the range,
without compromising flavour or function. The brand extended its
presence outside of the United States for the first time with a
successful launch in Canada, and further international roll outs
planned.
Underlying operating margin was flat
with gross margin improvement reinvested in marketing and
overheads.
Personal Care (23% of Group turnover)
In
Personal Care, we are focused on winning with science-led brands
that deliver unmissable superiority to our consumers across
Deodorants, Skin Cleansing, and Oral Care. Our priorities include
developing superior technology and multi-year innovation platforms,
leveraging partnerships with our customers, and expanding into
premium areas and digital channels.
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€13.8bn
|
8.9%
|
3.2%
|
5.5%
|
(0.9)%
|
(6.1)%
|
1.4%
|
20.2%
|
60bps
|
Fourth Quarter
|
€3.4bn
|
6.4%
|
2.5%
|
3.8%
|
(1.8)%
|
(7.5)%
|
(3.4)%
|
|
|
Personal Care grew underlying sales
8.9% for the year, with growth balanced between price and volume,
underpinned by continued strength in Deodorants. In the fourth
quarter all three categories drove positive volumes.
Personal Care's full year growth was
led by its Power Brands and science-backed innovations. These
innovations offer functional benefits but also deliver enhanced
health, hygiene, and superior skin cleansing. Personal Care
supported these innovations with a step-up in marketing investment,
including strategic sponsorships such as our first sponsorship deal
with FIFA.
Deodorants grew double-digit led by
strong volume growth, particularly in Europe and Latin America.
Rexona grew double-digit
and its range of products with 72-hour sweat and odour protection
technology is now in over 100 markets. Dove delivered double-digit growth with
the successful launch of Dove Advanced Care for women and the
launch of a new range of Dove
Men+Care antiperspirant. Axe grew high-single digit following
the launch of its new, long-lasting fine fragrance
collection.
Skin Cleansing delivered mid-single
digit growth with positive volumes. Lux grew double-digit driven by
elevated skin care benefits in soap bars from its ProGlow
technology. In the United States, Dove grew mid-single digit supported by
its Body Wash relaunch with new packaging and 24-hour renewing
MicroMoisture technology.
Oral Care grew mid-single digit led
by price. Close Up grew
double-digit and Pepsodent
grew mid-single digit, having expanded its premium offerings in
therapeutics and whitening.
The Dove Personal Care portfolio achieved
double-digit growth with balanced price and volume
growth.
Underlying operating margin
increased by 60bps, driven by a strong gross margin improvement
that was partly re-invested in increased brand and marketing
investment.
Home Care (21% of Group turnover)
In
Home Care, we focus on delivering for consumers who want superior
products that are sustainable and great value. We drive growth
through unmissable superiority in our biggest brands, in our key
markets and across channels. We have a resilient business that
spans price points and grows the market by premiumising and trading
consumers up to additional benefits.
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€12.2bn
|
5.9%
|
(0.9)%
|
6.8%
|
-%
|
(7.2)%
|
(1.8)%
|
12.3%
|
150bps
|
Fourth Quarter
|
€3.0bn
|
1.7%
|
0.8%
|
0.9%
|
-%
|
(7.5)%
|
(5.9)%
|
|
|
Home Care grew underlying sales 5.9%
for the full year, with 6.8% from price and (0.9)% from volume.
Volumes were positive in the second half, with a sharp price growth
deceleration in emerging markets reflecting commodity cost
deflation.
In Home Care we stepped up
investments in brand and marketing and R&D to drive unmissable
superiority of our biggest brands and deliver innovations that
enhance the efficacy and sustainability of our products.
Fabric Cleaning grew mid-single
digit for the year. This was led by high-single digit growth in
Latin America where we launched OMO Branco Absoluto that restores the
whiteness of clothes. South Asia delivered balanced high-single
digit growth as we continued to develop the market by offering a
full range of products to consumers, from entry-level products such
as our Wheel laundry soap
bar to mid-tier Rin, to
premium Surf Excel liquid
detergent. Growth in Europe was flat with double-digit price growth
offset by volume declines. We expanded plastic-free packaging for
OMO capsules to more
countries across Europe and drove premiumisation through next
generation innovation such as laundry sheets, a convenient and
sustainable alternative to liquids and capsules.
We leveraged our cross-category
science and technology platforms by using fragrance innovation from
Beauty & Wellbeing in Fabric Enhancers where we launched
Comfort Beauty Perfume in
Vietnam. Fabric enhancers delivered mid-single digit growth driven
by price with low-single digit volume decline. Turkey continued to
lead growth with double-digit price and volume growth.
Home & Hygiene grew mid-single
digit led by strong growth in Latin America and South Asia which
was partially offset by a decline in South East Asia. In the United
Kingdom, we launched Domestos Power Foam - an unmissably
superior innovation that is designed to spray upside down for
improved cleaning performance as well as convenience. High store
penetration and availability coupled with product superiority make
this a blueprint for future rollouts.
Underlying operating margin
increased by 150bps driven by the strong gross margin improvement
and a step-up in brand and marketing investment.
Nutrition (22% of Group turnover)
In
Nutrition, our strategy is to deliver consistent, competitive
growth by offering unmissably superior products through our biggest
brands. We do this by reaching more consumers and focusing on top
dishes and high consumption seasons to satisfy consumer's
preferences on taste, health and sustainability; while delivering
productivity and resilience in our supply
chain.
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€13.2bn
|
7.7%
|
(2.2)%
|
10.1%
|
(6.9)%
|
(5.2)%
|
(5.0)%
|
18.6%
|
100bps
|
Fourth Quarter
|
€3.4bn
|
4.7%
|
(1.1)%
|
5.9%
|
(0.4)%
|
(5.6)%
|
(1.5)%
|
|
|
Nutrition grew underlying sales 7.7%
for the year, with 10.1% from price and (2.2)% from volume. Growth
continued to be price-led as we responded to higher input costs of
food ingredients. In the fourth quarter, we saw an improvement in
volumes, with our two largest brands, Hellmann's and Knorr, returning to positive volume
growth.
Growth in Nutrition was driven
primarily by Knorr and
Hellmann's, which together
accounted for 60% of Nutrition's turnover in 2023. We sharpened our
focus on offering holistically superior products and unmissable
marketing campaigns in key seasons, supported by increased
marketing and R&D investment. Our business in Europe remained
challenging as a result of continued cost inflation, the targeted
exit of unprofitable SKUs, and private label share gains, impacting
both volumes and profitability.
Scratch Cooking Aids grew
high-single digit, led by Knorr, which achieved €5 billion in
turnover in 2023. North America grew mid-single digit, supported by
the 'Knorr Taste Combos'
campaign and the launch of Knorr ready-to-eat snack pots which
provide consumers with a nutritious meal while saving time. Latin
America grew double-digit and Europe grew mid-single digit as we
developed targeted campaigns to inspire healthier diets. Africa
grew double-digit, supported by fortified products that help
address malnutrition in the region.
Dressings grew double-digit driven
by price. With strong foundations in taste, sustainable ingredients
and recyclable bottles, Hellmann's grew double-digit with
positive volume driven by Latin America. The performance was helped
by further roll outs of our vegan and flavoured mayonnaise range.
We stepped up brand marketing investment to target high consumption
occasions such as Thanksgiving, Christmas or the summer BBQ season.
2023 was our third consecutive US Super Bowl 'Make Taste, Not
Waste' campaign with nearly 10 billion earned media impressions and
we partnered with the NBA in Brazil.
Unilever Food Solutions, now 20% of
Nutrition's sales, grew double-digit with positive volume and price
growth driven by our strong presence in Europe, North America and
North Asia. Our focus on customer service and digital selling has
enabled us to serve more operators and improve productivity. As the
food service market in China fully reopened, we grew double-digit,
helped by market making innovation such as extending Knorr bouillon to more flavours,
tapping into evolving consumer preferences.
Functional Nutrition returned to
growth while growing penetration and market share through its core
proposition for kids as well as premium innovation tailored for
women and people with diabetes.
Underlying operating margin
increased by 100bps, driven by gross margin improvement which
funded an increase in brand and marketing investment.
Ice Cream (13% of Group turnover)
In
Ice Cream, our immediate strategic priority is to expand operating
profit and global market share. We will do this by building the
unmissable superiority of our brands, accelerating market
development in emerging markets, continuing to lead the industry on
innovation and premiumisation, and by stepping up our performance
and productivity.
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
A&D
|
Currency
|
Turnover
change
|
UOM%
|
Change in
UOM
|
Full Year
|
€7.9bn
|
2.3%
|
(6.0)%
|
8.8%
|
0.9%
|
(2.7)%
|
0.5%
|
10.8%
|
(90)bps
|
Fourth Quarter
|
€1.2bn
|
(0.4)%
|
(0.8)%
|
0.4%
|
4.0%
|
(3.6)%
|
(0.2)%
|
|
|
Ice Cream grew underlying sales by
2.3%, with 8.8% from price and (6.0)% from volume. Volumes were
impacted throughout the year by high price elasticities with
consumers downtrading to value formats and less favourable summer
weather versus last year, mainly in Europe. In the fourth quarter,
price growth slowed significantly after double-digit price growth
in the first half of the year.
Ice Cream had a disappointing year
with declining market share and profitability. We continued to
invest behind our Power Brands, including Magnum and Cornetto, which generated almost 85% of
the Business Group's turnover. These brands remain well positioned
to meet consumer's desire for superior and indulgent ice
cream. Emerging markets delivered mid-single digit growth,
driven by a strong performance in Turkey. In the fourth quarter, we
made additional investments in promotions, particularly in North
America, to address competitiveness and volume decline.
In the full year, there was a
marginal decline in In-home Ice Cream (around 60% of the business),
with volumes down high-single digit broadly offset by pricing.
Inflation remained high and private label gained share as consumers
looked for value propositions in this discretionary category. In
the United States, our Talenti brand expanded from pints into
new formats with mini gelato and sorbetto bars.
Out-of-home Ice Cream (around 40% of
the business) grew high-single digit, driven by strong pricing
partially offset by some volume decline. Our limited-edition
Magnum innovation,
Starchaser and Sunlover, performed well and became Magnum's biggest ever
innovation.
Underlying operating margin declined
90bps, driven by lower gross margin as a result of continued cost
inflation and volume deleverage outstripping pricing, while brand
and marketing investment increased.
Full Year
Review: Geographical Areas
|
|
Full Year
2023
|
Fourth
Quarter 2023
|
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
Turnover
|
USG
|
UVG
|
UPG
|
Unilever
|
€59.6bn
|
7.0%
|
0.2%
|
6.8%
|
€14.2bn
|
4.7%
|
1.8%
|
2.8%
|
Asia Pacific Africa
|
€26.2bn
|
6.5%
|
1.1%
|
5.3%
|
€6.1bn
|
1.9%
|
0.7%
|
1.1%
|
The Americas
|
€21.5bn
|
9.3%
|
3.4%
|
5.7%
|
€5.4bn
|
9.6%
|
7.4%
|
2.0%
|
Europe
|
€11.9bn
|
4.1%
|
(7.7)%
|
12.8%
|
€2.7bn
|
2.5%
|
(6.3)%
|
9.4%
|
|
Full Year
2023
|
Fourth
Quarter 2023
|
(unaudited)
|
Turnover
|
USG
|
UVG
|
UPG
|
Turnover
|
USG
|
UVG
|
UPG
|
Emerging markets
|
€34.7bn
|
8.5%
|
1.6%
|
6.9%
|
€8.3bn
|
4.6%
|
2.3%
|
2.2%
|
Developed markets
|
€24.9bn
|
4.8%
|
(1.8)%
|
6.7%
|
€5.9bn
|
4.9%
|
1.1%
|
3.7%
|
North America
|
€13.1bn
|
5.8%
|
2.5%
|
3.3%
|
€3.2bn
|
7.0%
|
6.3%
|
0.7%
|
Latin America
|
€8.4bn
|
14.9%
|
4.8%
|
9.6%
|
€2.2bn
|
13.4%
|
9.1%
|
4.0%
|
Asia Pacific Africa
(44% of Group turnover)
Underlying sales growth was 6.5%
with price growth of 5.3% and volume growth of 1.1%.
India grew mid-single digit through
balanced price and volume growth. Sales were flat in the fourth
quarter as pricing turned negative, mainly driven by price
reductions in Fabric Cleaning and Skin Cleansing bars as a result
of commodity movements. We are focused on driving competitive
volume growth while pricing is expected to remain marginally
negative if current commodity prices persist.
China grew low single-digit in a
deflationary market with low consumer confidence. Growth was driven
by a strong performance in Unilever Food Solutions and growth in
Beauty & Wellbeing, while Home Care, Personal Care and Ice
Cream declined.
In Indonesia, sales declined
double-digit in the fourth quarter as consumers avoided the brands
of multinational companies in response to the geopolitical
situation in the Middle East. We have since seen some improvement
to customer and consumer uptake in January. Growth in the
Philippines was broad-based with a mix of price and volume growth
while Thailand and Vietnam saw mid-single and low-single digit
growth respectively, led by price.
Turkey delivered double-digit volume
growth in a hyperinflationary environment with all Business Groups
growing volumes.
Africa grew double-digit driven by
price as volume growth turned positive in the second
half.
The Americas (36% of Group turnover)
Underlying sales growth in North
America was strong at 5.8% with 2.5% from volume growth, which
accelerated to 6.3% in the fourth quarter, and 3.3% from price.
Beauty & Wellbeing grew double-digit led by Prestige and Health
& Wellbeing. Personal Care grew mid-single digit and Nutrition
grew high-single digit, with strong performances from Dove and Hellmann's respectively. Positive
volume growth in Beauty and Wellbeing, Nutrition, and Personal Care
was partially offset by a volume decline in Ice Cream.
Latin America grew 14.9% with 4.8%
from volume growth and 9.6% from price. Growth was broad-based with
double-digit growth in Brazil, Mexico, and Argentina. Personal Care
led growth through double-digit volume growth driven by
Rexona. Brazil growth was
led by Personal Care and Nutrition where Hellmann's Supreme became the market
leader in the premium Squeeze segment. Argentina grew volumes
double-digit despite challenging macro-economic and market
conditions, particularly in the fourth quarter.
Europe (20%
of Group turnover)
Underlying sales growth was 4.1%
with price at 12.8% and volume at (7.7)%.
Price growth remained elevated in
all Business Groups to at least partially recover the impact from
high input cost inflation. Personal Care and Beauty & Wellbeing
delivered strong growth with slightly positive volume. Nutrition
grew mid-single digit, while growth in Ice Cream and Home Care was
muted due to double-digit volume declines. Private label gained
share across most categories as consumer looked for value
propositions in a high inflation environment.
Price-led growth was broad-based
across most of the region. Eastern Europe and the United Kingdom
grew underlying sales strongly, while France declined.
Additional commentary on the financial statements - Full
Year
|
Finance costs and tax
Net finance costs reduced by €7
million to €486 million in 2023. This was driven by higher interest
income across several markets and a higher interest credit from
pensions, which more than offset the higher cost of debt on bonds
and commercial paper. Net finance costs were 2.1% on average net
debt. For 2024, we expect net finance costs to be between 2.5% to
3% on average net debt. This reflects the impact of refinancing
maturing debt at higher rates, and lower finance income and pension
credits versus 2023.
The underlying effective tax rate
for 2023 increased to 25.6% (2022: 24.1%), due to a number of
factors including an increase in non-deductible interest and
irrecoverable withholding tax, as well as lower benefits from tax
settlements and other one-off items. Our guidance for the
underlying effective tax rate remains around 25%. The effective
rate was 24.1% and included a benefit related to the disposal of
the Dollar Shave Club. This compares with 20.4% in the prior year,
which included a significant favourable impact related to the
disposal of the global tea business which benefited from the
participation exemption in the Netherlands.
Joint ventures, associates and other
income from non-current investments
Net profit from joint ventures and
associates increased €23 million to €231 million, largely driven by
the Pepsi-Lipton JVs. Other income from non-current investments was
€(22) million, versus €24 million in the prior year.
Earnings per share
Underlying earnings per share
increased 1.4% to €2.60, including (9.6)% of adverse currency.
Constant underlying earnings per share increased by 11.0%,
reflecting a strong operational performance. The reduction in the
average number of shares as a result of the share buyback programme
contributed 1.1%. Diluted earnings per share of €2.56 decreased by
14.2% versus the prior year that included the €2.3 billion profit
on disposal for the Tea business.
Free cash flow
We delivered strong cash conversion
of 111%. Free cash flow increased €1.9 billion to €7.1 billion
(2022: €5.2 billion). This increase was largely driven by higher
underlying operating profit, significantly improved working
capital, and included €0.4 billion linked to a tax refund in
India.
Underlying return on invested
capital
Underlying return on invested
capital improved to 16.2% (2022: 16.0%). This reflected the working
capital improvement that reduced total invested capital.
Net debt
Closing net debt was €23.7 billion
in line with 31 December 2022. Capital returns of €4.4 billion in
dividends and €1.5 billion in share buyback to PLC shareholders, as
well as net spend on acquisition and disposal activity, were fully
funded by the free cash flow delivery of €7.1 billion. Net debt to
underlying EBITDA was 2.1x as at 31 December 2023, in line with the
prior year and our guidance of around 2x.
Pensions
Pension assets net of liabilities
were in surplus of €2.4 billion at 31 December 2023 versus a
surplus of €2.6 billion at the end of 2022. The decrease was
primarily driven by reductions in interest rates increasing
liabilities more than assets.
Financial implications and
impairment risk in Russia
Our Russia business employs
approximately 3,000 people in Russia and in 2023 the business
represented around 1% of the Group's turnover and net profit. As at
31 December 2023, our Russia business had net assets of around €600
million, including four factories. During 2023 we reviewed our
position and concluded that the containment actions we put in place
at the beginning of the war minimise our economic contribution to
the Russian state.
We will continue to review and
disclose the financial implications from the conflict. While the
potential impacts remain uncertain, there remains a risk that our
operations in Russia are unable to continue, leading to loss of
turnover, profit and a write-down of assets.
Share buyback programme
On 18 October 2023, we completed the
fourth and final €750 million tranche of our share buyback
programme of up to €3 billion, initiated on 10 February 2022. The
total consideration paid for the repurchase of 16,181,572 shares is
recorded within other reserves and the shares are held by Unilever
as treasury shares. Under the first three tranches of the
programme, a total of 49,770,289 ordinary Unilever PLC shares were
purchased, and subsequently cancelled on 2 August 2023.
Reflecting the Group's continued
strong cash generation and anticipated proceeds from the sale of
Elida Beauty, the Board has approved a share buyback programme of
up to €1.5 billion to be conducted during 2024, which we expect to
commence in the second quarter.
Finance and liquidity
In 2023, the following notes matured
and were repaid:
•
February: €600 million 0.375% fixed rate
notes
•
March: $550 million 3.125% fixed rate
notes
•
June: €500 million 1.00% fixed rate
notes
•
August: €500 million 0.50% fixed rate
notes
•
September: $500 million 0.375% fixed rate
notes
The following notes were
issued:
•
February: €500 million 3.25% fixed rate notes
maturing in February 2031 and €500 million 3.50% fixed rate notes
due February 2035
•
June: €550 million 3.30% fixed rate notes due June
2029 and €700 million 3.40% fixed rate notes due June
2033
•
September: $700 million 4.875% fixed rate notes
due September 2028 and $800 million 5.00% fixed rate notes due
December 2033
On 31 December 2023, Unilever had
undrawn revolving 364-day bilateral credit facilities in aggregate
of $5,200 million and €2,600 million with a 364-day term
out.
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.
Functional Currency of Unilever PLC
|
Effective from 1 January 2024, the
functional currency of Unilever PLC ("PLC"), the Group's ultimate
parent company, has changed from Sterling to Euro. This follows a
review and subsequent change of the internal debt of PLC, from
Sterling to Euro, which triggered a formal evaluation of PLCs
functional currency in line with relevant accounting standards. The
change is applied prospectively. There is no change to the stock
listing currency of the Group and future dividends will continue to
be paid in Sterling, Euro, and US dollar depending on the location
of the exchange where shares are traded. There is no impact on the
presentation of the Group results nor will there be any restatement
to the Group financial statements as a result of this
change.
Certain discussions and analyses set
out in this announcement include measures which 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, 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.
Unilever uses 'constant rate', and
'underlying' measures primarily for internal performance analysis
and targeting purposes. We present certain items, percentages and
movements, using constant exchange rates, which exclude the impact
of fluctuations in foreign currency exchange rates. We calculate
constant currency values by translating both the current and the
prior period local currency amounts using the prior year average
exchange rates into euro, except for the local currency of entities
that operate in hyperinflationary economies. These currencies are
translated into euros using the prior year closing exchange rate
before the application of IAS 29. The table below shows exchange
rate movements in our key markets.
|
Annual
average rate in 2023
|
Annual
average rate in 2022
|
Brazilian Real (€1 = BRL)
|
5.405
|
5.414
|
Chinese Yuan (€1 = CNY)
|
7.635
|
7.047
|
Indian Rupee (€1 = INR)
|
89.232
|
82.303
|
Indonesia Rupiah (€1 =
IDR)
|
16,457
|
15,535
|
Philippine Peso (€1 =
PHP)
|
60.110
|
57.194
|
UK Pound Sterling (€1 =
GBP)
|
0.870
|
0.851
|
US Dollar (€1 = US $)
|
1.081
|
1.050
|
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 (A&D) 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 in notes 3 and 4.
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 in notes 3 and 4.
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 in notes 3 and 4.
Non-underlying items
Several non-GAAP measures are
adjusted to exclude items defined as non-underlying due to their
nature and/or frequency of occurrence.
• Non-underlying items within operating profit are:
gains or losses on business disposals, acquisition
and disposal related costs, restructuring costs, impairments and
other items within operating profit classified here due to their
nature and frequency.
• Non-underlying items not in operating profit but within net
profit are: net monetary gain/(loss)
arising from hyperinflationary economies and significant and
unusual items in net finance cost, share of profit/(loss) of joint
ventures and associates and taxation.
• Non-underlying items are: both
non-underlying items within operating profit and those
non-underlying items not in operating profit but within net
profit.
Underlying operating profit (UOP)
and underlying operating margin (UOM)
Underlying operating profit and
underlying operating margin mean operating profit and operating
margin before the impact of non-underlying items within operating
profit. Underlying operating profit represents our measure of
segment profit or loss as it is the primary measure used for making
decisions about allocating resources and assessing performance of
the segments. The reconciliation of operating profit to underlying
operating profit is as follows:
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Operating profit
|
9,758
|
10,755
|
Non-underlying items within
operating profit (see note 2)
|
173
|
(1,072)
|
Underlying operating
profit
|
9,931
|
9,683
|
Turnover
|
59,604
|
60,073
|
Operating margin (%)
|
16.4
|
17.9
|
Underlying operating margin
(%)
|
16.7
|
16.1
|
Underlying effective tax
rate
The underlying effective tax rate is
calculated by dividing taxation excluding the tax impact of
non-underlying items by profit before tax excluding the impact of
non-underlying items and share of net (profit)/loss of joint
ventures and associates. This measure reflects the underlying tax
rate in relation to profit before tax excluding non-underlying
items before tax and share of net profit/(loss) of joint ventures
and associates. Tax impact on non-underlying items within operating
profit is the sum of the tax on each non-underlying item, based on
the applicable country tax rates and tax treatment. This is shown
in the following table:
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Taxation
|
2,199
|
2,068
|
Tax impact of:
|
|
|
Non-underlying items within
operating profit(a)
|
207
|
273
|
Non-underlying items not in
operating profit but within net profit(a)
|
12
|
(121)
|
Taxation before tax impact of
non-underlying items
|
2,418
|
2,220
|
Profit before taxation
|
9,339
|
10,337
|
Share of net (profit)/loss of joint
ventures and associates
|
(231)
|
(208)
|
Profit before tax excluding share of
net profit/(loss) of joint ventures and associates
|
9,108
|
10,129
|
Non-underlying items within
operating profit before tax(a)
|
173
|
(1,072)
|
Non-underlying items not in
operating profit but within net profit before tax
|
153
|
164
|
Profit before tax excluding
non-underlying items before tax and share of net profit/(loss) of
joint ventures and associates
|
9,434
|
9,221
|
Effective tax rate (%)
|
24.1
|
20.4
|
Underlying effective tax rate
(%)
|
25.6
|
24.1
|
(a) See note 2.
Underlying earnings per
share
Underlying earnings per share
(underlying EPS) is calculated as underlying profit attributable to
shareholders' equity divided by the diluted average number of
ordinary shares. In calculating underlying profit attributable to
shareholders' equity, net profit attributable to shareholders'
equity is adjusted to eliminate the post-tax impact of
non-underlying items. This measure reflects the underlying earnings
for each share unit of the Group. Refer to note 6 for
reconciliation of net profit attributable to shareholders' equity
to underlying profit attributable to shareholders'
equity.
Constant underlying EPS
Constant underlying earnings per
share (constant underlying EPS) is calculated as underlying profit
attributable to shareholders' equity at constant exchange rates and
excluding the impact of both translational hedges and price growth
in excess of 26% per year in hyperinflationary economies divided by
the diluted average number of ordinary shares. This measure
reflects the underlying earnings for each share unit of the Group
in constant exchange rates.
The reconciliation of underlying
profit attributable to shareholders' equity to constant underlying
earnings attributable to shareholders' equity and the calculation
of constant underlying EPS is as follows:
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Underlying profit attributable to
shareholders' equity (see note 6)
|
6,588
|
6,568
|
Impact of translation from current
to constant exchange rates and translational hedges
|
992
|
(10)
|
Impact of price growth in excess of
26% per year in hyperinflationary economies
|
(378)
|
-
|
Constant underlying earnings
attributable to shareholders' equity
|
7,202
|
6,558
|
Diluted average number of share
units (millions of units)
|
2,532.4
|
2,559.8
|
Constant underlying EPS
(€)
|
2.84
|
2.56
|
Net debt
Net debt is a measure that provides
valuable additional information on the summary presentation of the
Group's net financial liabilities and is a measure in common use
elsewhere. Net debt is defined as the excess of total financial
liabilities, excluding trade payables and other current
liabilities, over cash, cash equivalents and other current
financial assets, excluding trade and other current receivables,
and non-current financial asset derivatives that relate to
financial liabilities.
The reconciliation of total
financial liabilities to net debt is as follows:
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Total financial
liabilities
|
(29,622)
|
(29,488)
|
Current financial
liabilities
|
(5,087)
|
(5,775)
|
Non-current financial
liabilities
|
(24,535)
|
(23,713)
|
Cash and cash equivalents as per
balance sheet
|
4,159
|
4,326
|
Cash and cash equivalents as per
cash flow statement
|
4,045
|
4,225
|
Add: bank overdrafts deducted
therein
|
116
|
101
|
Less: cash and cash equivalents held
for sale
|
(2)
|
-
|
Other current financial
assets
|
1,731
|
1,435
|
Non-current financial asset
derivatives that relate to financial liabilities
|
75
|
51
|
Net debt
|
(23,657)
|
(23,676)
|
Free cash flow (FCF)
Within the Unilever Group, free cash
flow (FCF) is defined as cash flow from operating activities, less
income taxes paid, net capital expenditure and net interest
payments. It does not represent residual cash flows entirely
available for discretionary purposes; for example, the repayment of
principal amounts borrowed is not deducted from FCF. FCF reflects
an additional way of viewing our liquidity that we believe is
useful to investors because it represents cash flows that could be
used for distribution of dividends, repayment of debt or to fund
our strategic initiatives, including acquisitions, if
any.
The reconciliation of cash flow from
operating activities to FCF is as follows:
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Cash flow from operating
activities
|
11,561
|
10,089
|
Income tax paid
|
(2,135)
|
(2,807)
|
Net capital expenditure
|
(1,703)
|
(1,627)
|
Net interest paid
|
(632)
|
(457)
|
Free cash flow
|
7,091
|
5,198
|
Net cash flow (used in)/from
investing activities
|
(2,294)
|
2,453
|
Net cash flow used in financing
activities
|
(7,193)
|
(8,890)
|
Cash conversion
Unilever defines cash conversion as
free cash flow excluding tax on disposal as a proportion of net
profit, excluding P&L on disposal and income from JV,
associates and non-current investments. This reflects our ability
to convert profit to cash.
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Net profit
|
7,140
|
8,269
|
Gain on disposal of group
companies
|
(489)
|
(2,335)
|
Share of net profit of joint
ventures and associates
|
(231)
|
(208)
|
Other loss/(income) from non-current
investments and associates
|
22
|
(24)
|
Tax on gain on disposal of group
companies
|
(69)
|
(1)
|
Net profit excluding P&L on
disposals, JV, associates, NCI
|
6,373
|
5,701
|
Free cash flow
|
7,091
|
5,198
|
Cash impact of tax on
disposal
|
14
|
330
|
Free cash flow excluding cash impact
of tax on disposal
|
7,105
|
5,528
|
Cash conversion (%)
|
111
|
97
|
Underlying return on invested
capital (ROIC)
Underlying return on invested
capital (ROIC) is a measure of the return generated on capital
invested by the Group. The measure provides a guard rail for
long-term value creation and encourages compounding reinvestment
within the business and discipline around acquisitions with low
returns and long payback. Underlying ROIC is calculated as
underlying operating profit after tax divided by the annual average
of: goodwill, intangible assets, property, plant and equipment, net
assets held for sale, inventories, trade and other current
receivables, and trade payables and other current
liabilities.
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Operating profit
|
9,758
|
10,755
|
Non-underlying items within
operating profit (see note 2)
|
173
|
(1,072)
|
Underlying operating profit before
tax
|
9,931
|
9,683
|
Tax on underlying operating
profit(a)
|
(2,545)
|
(2,331)
|
Underlying operating profit after
tax
|
7,386
|
7,352
|
Goodwill
|
21,109
|
21,609
|
Intangible assets
|
18,357
|
18,880
|
Property, plant and
equipment
|
10,707
|
10,770
|
Net assets held for sale
|
516
|
24
|
Inventories
|
5,119
|
5,931
|
Trade and other current
receivables
|
5,775
|
7,056
|
Trade payables and other current
liabilities
|
(16,857)
|
(18,023)
|
Period-end invested
capital
|
44,726
|
46,247
|
Average invested capital for the
period
|
45,487
|
46,005
|
Underlying return on invested
capital (%)
|
16.2
|
16.0
|
(a) Tax on underlying operating
profit is calculated as underlying operating profit before tax
multiplied by the underlying effective tax rate of 25.6% (2022:
24.1%) which is shown on page 14.
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.
Media: Media
Relations Team
|
Investors: Investor Relations Team
|
UK
|
+44 78 3304 8414
|
gemma.shaw@unilever.com
|
investor.relations@unilever.com
|
or
|
+44 77 7999 9683
|
jonathan.sibun@teneo.com
|
|
|
NL
|
+31 62 191 3705
|
kiran.hofker@unilever.com
|
|
|
or
|
+31 61 500 8293
|
fleur-van.bruggen@unilever.com
|
|
|
After the conference call on 8
February 2024 at 8:00 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.
Consolidated income statement
|
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Change
|
Turnover
|
59,604
|
60,073
|
(0.8)%
|
Operating profit
|
9,758
|
10,755
|
(9.3)%
|
Net finance costs
|
(486)
|
(493)
|
|
Pensions and similar
obligations
|
110
|
44
|
|
Finance income
|
442
|
281
|
|
Finance costs
|
(1,038)
|
(818)
|
|
Net monetary loss arising from
hyperinflationary economies
|
(142)
|
(157)
|
|
Share of net profit of joint
ventures and associates
|
231
|
208
|
|
Other (loss)/income from non-current
investments and associates
|
(22)
|
24
|
|
Profit before taxation
|
9,339
|
10,337
|
(9.7)%
|
Taxation
|
(2,199)
|
(2,068)
|
|
Net profit
|
7,140
|
8,269
|
(13.7)%
|
|
|
|
|
Attributable to:
|
|
|
|
Non-controlling interests
|
653
|
627
|
|
Shareholders' equity
|
6,487
|
7,642
|
(15.1)%
|
Earnings per share
|
|
|
|
Basic earnings per share
(euros)
|
2.58
|
3.00
|
(14.0)%
|
Diluted earnings per share
(euros)
|
2.56
|
2.99
|
(14.2)%
|
Consolidated statement of comprehensive income
|
€ million
|
Full
Year
|
(unaudited)
|
2023
|
2022
|
Net profit
|
7,140
|
8,269
|
Other comprehensive
income
|
|
|
Items that will not be reclassified
to profit or loss, net of tax:
|
|
|
Gains/(losses) on equity instruments
measured at fair value through other comprehensive
income
|
(28)
|
36
|
Remeasurement of defined benefit
pension plans
|
(510)
|
(473)
|
Items that may be reclassified
subsequently to profit or loss, net of tax:
|
|
|
Losses on cash flow
hedges
|
(27)
|
(91)
|
Currency retranslation
(losses)/gains
|
(1,461)
|
614
|
Total comprehensive
income
|
5,114
|
8,355
|
|
|
|
Attributable to:
|
|
|
Non-controlling interests
|
524
|
507
|
Shareholders' equity
|
4,590
|
7,848
|
Consolidated statement of changes in equity
|
(unaudited)
|
|
|
|
|
|
|
|
|
€ million
|
Called
up
share
capital
|
Share
premium
account
|
Unification
reserve
|
Other
reserves
|
Retained
profit
|
Total
|
Non-
controlling
interest
|
Total
equity
|
31 December 2021
|
92
|
52,844
|
(73,364)
|
(9,210)
|
46,745
|
17,107
|
2,639
|
19,746
|
Hyperinflation restatement to 1
January 2022 (Turkey)
|
-
|
-
|
-
|
-
|
154
|
154
|
-
|
154
|
Adjusted opening balance
|
92
|
52,844
|
(73,364)
|
(9,210)
|
46,899
|
17,261
|
2,639
|
19,900
|
Profit or loss for the
period
|
-
|
-
|
-
|
-
|
7,642
|
7,642
|
627
|
8,269
|
Other comprehensive income, net of
tax:
|
|
|
|
|
|
|
|
|
Gains/(losses) on:
|
|
|
|
|
|
|
|
|
Equity instruments
|
-
|
-
|
-
|
45
|
-
|
45
|
(9)
|
36
|
Cash flow hedges
|
-
|
-
|
-
|
(92)
|
-
|
(92)
|
1
|
(91)
|
Remeasurements of defined benefit
pension plans
|
-
|
-
|
-
|
-
|
(474)
|
(474)
|
1
|
(473)
|
Currency retranslation
gains/(losses)(a)
|
-
|
-
|
-
|
240
|
487
|
727
|
(113)
|
614
|
Total comprehensive
income
|
-
|
-
|
-
|
193
|
7,655
|
7,848
|
507
|
8,355
|
Dividends on ordinary
capital
|
-
|
-
|
-
|
-
|
(4,356)
|
(4,356)
|
-
|
(4,356)
|
Repurchase of
shares(b)
|
-
|
-
|
-
|
(1,509)
|
-
|
(1,509)
|
-
|
(1,509)
|
Movements in treasury
shares(c)
|
-
|
-
|
-
|
106
|
(137)
|
(31)
|
-
|
(31)
|
Share-based payment
credit(d)
|
-
|
-
|
-
|
-
|
177
|
177
|
-
|
177
|
Dividends paid to non-controlling
interests
|
-
|
-
|
-
|
-
|
-
|
-
|
(572)
|
(572)
|
Hedging loss transferred to
non-financial assets
|
-
|
-
|
-
|
(126)
|
-
|
(126)
|
(1)
|
(127)
|
Other movements in
equity(e)
|
-
|
-
|
-
|
(258)
|
15
|
(243)
|
107
|
(136)
|
31 December 2022
|
92
|
52,844
|
(73,364)
|
(10,804)
|
50,253
|
19,021
|
2,680
|
21,701
|
Profit or loss for the
period
|
-
|
-
|
-
|
-
|
6,487
|
6,487
|
653
|
7,140
|
Other comprehensive income, net of
tax:
|
|
|
|
|
|
|
|
|
Gains/(losses) on:
|
|
|
|
|
|
|
|
|
Equity instruments
|
-
|
-
|
-
|
(27)
|
-
|
(27)
|
(1)
|
(28)
|
Cash flow hedges
|
-
|
-
|
-
|
(27)
|
-
|
(27)
|
-
|
(27)
|
Remeasurements of defined benefit
pension plans
|
-
|
-
|
-
|
-
|
(508)
|
(508)
|
(2)
|
(510)
|
Currency retranslation
gains/(losses)(f)
|
-
|
-
|
-
|
(1,629)
|
294
|
(1,335)
|
(126)
|
(1,461)
|
Total comprehensive
income
|
-
|
-
|
-
|
(1,683)
|
6,273
|
4,590
|
524
|
5,114
|
Dividends on ordinary
capital
|
-
|
-
|
-
|
-
|
(4,327)
|
(4,327)
|
-
|
(4,327)
|
Cancellation of treasury
shares(g)
|
(4)
|
-
|
-
|
5,282
|
(5,278)
|
-
|
-
|
-
|
Repurchase of
shares(b)
|
-
|
-
|
-
|
(1,507)
|
-
|
(1,507)
|
-
|
(1,507)
|
Movements in treasury
shares(c)
|
-
|
-
|
-
|
75
|
(98)
|
(23)
|
-
|
(23)
|
Share-based payment
credit(d)
|
-
|
-
|
-
|
-
|
212
|
212
|
-
|
212
|
Dividends paid to non-controlling
interests
|
-
|
-
|
-
|
-
|
-
|
-
|
(521)
|
(521)
|
Hedging gain/(loss) transferred to
non-financial assets
|
-
|
-
|
-
|
117
|
-
|
117
|
-
|
117
|
Other movements in equity
|
-
|
-
|
-
|
2
|
17
|
19
|
(21)
|
(2)
|
31 December 2023
|
88
|
52,844
|
(73,364)
|
(8,518)
|
47,052
|
18,102
|
2,662
|
20,764
|
(a) Includes a hyperinflation
adjustment of €514 million in relation to Argentina and
Turkey.
(b) Repurchase of shares
reflects the cost of acquiring ordinary shares as part of the share
buyback program announced on 10 February 2022.
(c) Includes purchases
and sales of treasury shares, other than the share buyback
programme and the transfer from treasury shares to retained profit
of share-settled schemes arising from prior years and differences
between purchase and grant price of share awards.
(d) The share-based payment credit relates to the non-cash charge
recorded against operating profit in respect of the fair value of
share options and awards granted to employees.
(e) Includes the following items related to the acquisition of
Nutrafol: €(269) million non-controlling interest purchase option
in other reserves and €99 million non-controlling interest
recognised on acquisition.
(f) Includes a
hyperinflation adjustment of €308 million in relation to Argentina
and Turkey.
(g) During 2023, 112,746,434
PLC ordinary shares held as treasury shares were cancelled. The
amount paid to repurchase these shares was initially recognised in
other reserves and is transferred to retained profit on
cancellation.
Consolidated balance sheet
|
(unaudited)
|
|
|
€ million
|
As at 31
December 2023
|
As at 31
December 2022
|
Non-current assets
|
|
|
Goodwill
|
21,109
|
21,609
|
Intangible assets
|
18,357
|
18,880
|
Property, plant and
equipment
|
10,707
|
10,770
|
Pension asset for funded schemes in
surplus
|
3,781
|
4,260
|
Deferred tax assets
|
1,113
|
1,049
|
Financial assets
|
1,386
|
1,154
|
Other non-current assets
|
911
|
942
|
|
57,364
|
58,664
|
Current assets
|
|
|
Inventories
|
5,119
|
5,931
|
Trade and other current
receivables
|
5,775
|
7,056
|
Current tax assets
|
427
|
381
|
Cash and cash equivalents
|
4,159
|
4,326
|
Other financial assets
|
1,731
|
1,435
|
Assets held for sale
|
691
|
28
|
|
17,902
|
19,157
|
|
|
|
Total assets
|
75,266
|
77,821
|
|
|
|
Current liabilities
|
|
|
Financial liabilities
|
5,087
|
5,775
|
Trade payables and other current
liabilities
|
16,857
|
18,023
|
Current tax liabilities
|
851
|
877
|
Provisions
|
537
|
748
|
Liabilities held for sale
|
175
|
4
|
|
23,507
|
25,427
|
Non-current liabilities
|
|
|
Financial liabilities
|
24,535
|
23,713
|
Non-current tax
liabilities
|
384
|
94
|
Pensions and post-retirement
healthcare liabilities:
|
|
|
Funded schemes in deficit
|
351
|
613
|
Unfunded schemes
|
1,029
|
1,078
|
Provisions
|
563
|
550
|
Deferred tax liabilities
|
3,995
|
4,375
|
Other non-current
liabilities
|
138
|
270
|
|
30,995
|
30,693
|
|
|
|
Total liabilities
|
54,502
|
56,120
|
|
|
|
Equity
|
|
|
Shareholders' equity
|
18,102
|
19,021
|
Non-controlling interests
|
2,662
|
2,680
|
Total equity
|
20,764
|
21,701
|
|
|
|
Total liabilities and
equity
|
75,266
|
77,821
|
Consolidated cash flow statement
|
(unaudited)
|
Full
Year
|
€ million
|
2023
|
2022
|
Net profit
|
7,140
|
8,269
|
Taxation
|
2,199
|
2,068
|
Share of net profit of joint
ventures/associates and other (income)/loss from non-current
investments and associates
|
(209)
|
(232)
|
Net monetary loss arising from
hyperinflationary economies
|
142
|
157
|
Net finance costs
|
486
|
493
|
Operating profit
|
9,758
|
10,755
|
|
|
|
Depreciation, amortisation and
impairment
|
1,579
|
1,946
|
Changes in working
capital
|
814
|
(422)
|
Inventories
|
340
|
(1,398)
|
Trade and other
receivables
|
768
|
(1,852)
|
Trade payables and other
liabilities
|
(294)
|
2,828
|
Pensions and similar obligations
less payments
|
(281)
|
(119)
|
Provisions less payments
|
(185)
|
203
|
Elimination of profits on
disposals
|
(433)
|
(2,335)
|
Non-cash charge for share-based
compensation
|
212
|
177
|
Other adjustments
|
97
|
(116)
|
Cash flow from operating
activities
|
11,561
|
10,089
|
Income tax paid
|
(2,135)
|
(2,807)
|
Net cash flow from operating
activities
|
9,426
|
7,282
|
|
|
|
Interest received
|
267
|
287
|
Purchase of intangible
assets
|
(243)
|
(253)
|
Purchase of property, plant and
equipment
|
(1,502)
|
(1,456)
|
Disposal of property, plant and
equipment
|
42
|
82
|
Acquisition of businesses and
investments in joint ventures and associates
|
(704)
|
(979)
|
Disposal of businesses, joint
ventures and associates
|
436
|
4,622
|
Acquisition of other non-current
investments
|
(533)
|
(170)
|
Disposal of other non-current
investments
|
62
|
266
|
Dividends from joint ventures,
associates and other non-current investments
|
239
|
185
|
(Purchase)/sale of financial
assets
|
(358)
|
(131)
|
Net cash flow (used in)/from
investing activities
|
(2,294)
|
2,453
|
|
|
|
Dividends paid on ordinary share
capital
|
(4,363)
|
(4,329)
|
Interest paid
|
(899)
|
(744)
|
Net change in short-term
borrowings
|
(570)
|
(545)
|
Additional financial
liabilities
|
4,972
|
7,776
|
Repayment of financial
liabilities
|
(3,905)
|
(8,440)
|
Capital element of lease rental
payments
|
(394)
|
(518)
|
Repurchase of shares
|
(1,507)
|
(1,509)
|
Other financing
activities
|
(527)
|
(581)
|
Net cash flow used in financing
activities
|
(7,193)
|
(8,890)
|
|
|
|
Net (decrease)/increase in cash and
cash equivalents
|
(61)
|
845
|
|
|
|
Cash and cash equivalents at the
beginning of the period
|
4,225
|
3,387
|
|
|
|
Effect of foreign exchange rate
changes
|
(119)
|
(7)
|
|
|
|
Cash and cash equivalents at the end
of the period
|
4,045
|
4,225
|
Notes to
the condensed consolidated financial statements
|
(unaudited)
1. Accounting
information and policies
|
Except as set out below the
accounting policies and methods of computation are consistent with
the year ended 31 December 2022. In conformity with the
requirements of the Companies Act 2006, the condensed consolidated
preliminary financial statements have been prepared based on the
International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standard Board (IASB) and UK-adopted
international accounting standards.
The condensed consolidated financial
statements are shown at current exchange rates, and percentage
year-on-year changes are shown to facilitate comparison. The
consolidated income statement on page 18, the consolidated statement of
comprehensive income on page 18, the consolidated statement of
changes in equity on page 19
and the consolidated cash flow statement on
page 21 are
translated at exchange rates current in each period. The balance
sheet on page 20 is
translated at period-end rates of exchange.
The condensed consolidated financial
statements attached do not constitute the full financial statements
within the meaning of Section 434 of the UK Companies Act 2006,
which will be finalised and delivered to the Registrar of Companies
in due course. Full accounts for Unilever for the year ended 31
December 2022 have been delivered to the Registrar of Companies;
the auditors' reports on these accounts were unqualified, did not
include a reference to any matters by way of emphasis and did not
contain a statement under Section 498 (2) or Section 498 (3) of the
UK Companies Act 2006.
New accounting standards
On 1 January 2023, the Group adopted
IFRS 17 'Insurance Contracts'. The standard introduces a new model
for accounting for insurance contracts. We have reviewed existing
arrangements and concluded that IFRS 17 does not impact the
condensed consolidated financial statements.
On 23 May 2023, amendments to IAS 12
'Income Taxes' came into effect relating to International Tax
Reform (Pillar Two). These amendments clarify when an entity shall
disclose qualitative and quantitative information about its
exposure to Pillar Two income taxes. Effective immediately, the
amendments also provide a temporary mandatory exemption from
deferred tax accounting. There is no impact on the condensed
consolidated financial statements.
All other new standards or
amendments issued by the IASB and UK Endorsement Board that are
effective or not yet effective, are either not applicable or not
material to the Group.
2. Significant items
within the income statement
|
Non-underlying items
These include non-underlying items
within operating profit and non-underlying items not in operating
profit but within net profit:
• Non-underlying items within operating profit
are gains or losses on business disposals,
acquisition and disposal related costs, restructuring costs,
impairments and other items within operating profit classified here
due to their nature and frequency.
• Non-underlying items not in operating profit but within net
profit are net monetary gain/(loss) arising
from hyperinflationary economies and significant and unusual items
in net finance cost, share of profit/(loss) of joint ventures and
associates and taxation.
Restructuring costs are charges
associated with activities planned by management that significantly
change either the scope of the business or the manner in which it
is conducted.
|
Full
Year
|
€ million
|
2023
|
2022
|
Acquisition and disposal-related
credits/(costs)(a)
|
(242)
|
(50)
|
Gain/(loss) on disposal of group
companies(b)
|
489
|
2,335
|
Restructuring
costs(c)
|
(499)
|
(777)
|
Impairments(d)
|
(1)
|
(221)
|
Other(e)
|
80
|
(215)
|
Non-underlying items within
operating profit before tax
|
(173)
|
1,072
|
|
|
|
Tax on non-underlying items within
operating profit
|
207
|
273
|
Non-underlying items within
operating profit after tax
|
34
|
1,345
|
|
|
|
Interest related to the UK tax audit
of intangible income and centralised services
|
(11)
|
(7)
|
Net monetary loss arising from
hyperinflationary economies
|
(142)
|
(157)
|
Non-underlying items not in
operating profit but within net profit before tax
|
(153)
|
(164)
|
|
|
|
Tax impact of non-underlying items
not in operating profit but within net profit:
|
|
|
Taxes related to separation of
Ekaterra
|
(4)
|
(35)
|
Taxes related to the UK tax audit of
intangible income and centralised services
|
(5)
|
(5)
|
Hyperinflation adjustment for
Argentina and Turkey deferred tax
|
21
|
(81)
|
Non-underlying items not in
operating profit but within net profit after tax
|
(141)
|
(285)
|
|
|
|
Non-underlying items after
tax(f)
|
(107)
|
1,060
|
|
|
|
Attributable to:
|
|
|
Non-controlling interests
|
(6)
|
(14)
|
Shareholders' equity
|
(101)
|
1,074
|
(a) 2023 includes a charge of €104 million for the revaluation of
the minority interest liability of Nutrafol, €43 million relating
to the disposal of Elida Beauty and €10 million (2022: €42 million)
relating to the disposal of the global tea business.
(b) 2023 includes a gain of €497 million related to the disposal
of Suave business in North America. 2022 includes a gain of €2,303
million related to the disposal of the global tea
business.
(c) Restructuring costs are comprised of strategic organisational
change programmes (including Compass), and transformational
technology and supply chain projects.
(d) 2022 includes an impairment charge of €192 million relating to
Dollar Shave Club.
(e) 2023 includes €28 million net release after utilisation to the
provision (2022: €89 million charge) relating to a product recall
and market withdrawal by The Laundress, €107 million release (2022:
€82 million charge) relating to legal provisions for ongoing
competition investigations and €54 million charge (2022: €42
million charge) relating to our businesses in Russia and
Ukraine.
(f) Non-underlying items after tax is calculated as non-underlying
items within operating profit after tax plus non-underlying items
not in operating profit but within net profit after tax.
3. Segment information -
Business Groups
|
Fourth Quarter
|
Beauty
& Wellbeing
|
Personal
Care
|
Home
Care
|
Nutrition
|
Ice
Cream
|
Total
|
Turnover (€ million)
|
|
|
|
|
|
|
2022
|
3,255
|
3,522
|
3,162
|
3,468
|
1,204
|
14,611
|
2023
|
3,181
|
3,404
|
2,974
|
3,416
|
1,202
|
14,177
|
Change (%)
|
(2.3)
|
(3.4)
|
(5.9)
|
(1.5)
|
(0.2)
|
(3.0)
|
Impact of:
|
|
|
|
|
|
|
Acquisitions (%)
|
0.1
|
-
|
-
|
-
|
4.0
|
0.3
|
Disposals (%)
|
(2.2)
|
(1.8)
|
-
|
(0.4)
|
-
|
(1.0)
|
Currency-related items (%), of
which:
|
(7.5)
|
(7.5)
|
(7.5)
|
(5.6)
|
(3.6)
|
(6.7)
|
Exchange rates changes (%)
|
(9.1)
|
(10.2)
|
(11.3)
|
(7.5)
|
(4.3)
|
(9.1)
|
Extreme price growth in hyperinflationary markets*
(%)
|
1.8
|
3.0
|
4.3
|
2.1
|
0.7
|
2.6
|
Underlying sales growth
(%)
|
7.9
|
6.4
|
1.7
|
4.7
|
(0.4)
|
4.7
|
Price* (%)
|
1.5
|
3.8
|
0.9
|
5.9
|
0.4
|
2.8
|
Volume (%)
|
6.3
|
2.5
|
0.8
|
(1.1)
|
(0.8)
|
1.8
|
Full Year
|
Beauty
& Wellbeing
|
Personal
Care
|
Home
Care
|
Nutrition
|
Ice
Cream
|
Total
|
Turnover (€ million)
|
|
|
|
|
|
|
2022
|
12,250
|
13,636
|
12,401
|
13,898
|
7,888
|
60,073
|
2023
|
12,466
|
13,829
|
12,181
|
13,204
|
7,924
|
59,604
|
Change (%)
|
1.8
|
1.4
|
(1.8)
|
(5.0)
|
0.5
|
(0.8)
|
Impact of:
|
|
|
|
|
|
|
Acquisitions (%)
|
1.9
|
-
|
-
|
-
|
0.9
|
0.5
|
Disposals (%)
|
(1.7)
|
(0.9)
|
-
|
(6.9)
|
-
|
(2.1)
|
Currency-related items (%), of
which:
|
(6.2)
|
(6.1)
|
(7.2)
|
(5.2)
|
(2.7)
|
(5.7)
|
Exchange rates changes (%)
|
(7.5)
|
(8.0)
|
(10.3)
|
(6.8)
|
(5.4)
|
(7.8)
|
Extreme price growth in hyperinflationary markets*
(%)
|
1.5
|
2.1
|
3.4
|
1.7
|
2.8
|
2.2
|
Underlying sales growth
(%)
|
8.3
|
8.9
|
5.9
|
7.7
|
2.3
|
7.0
|
Price* (%)
|
3.8
|
5.5
|
6.8
|
10.1
|
8.8
|
6.8
|
Volume (%)
|
4.4
|
3.2
|
(0.9)
|
(2.2)
|
(6.0)
|
0.2
|
|
|
|
|
|
|
|
Operating profit (€
million)
|
|
|
|
|
|
|
2022
|
2,154
|
2,264
|
1,064
|
4,497
|
776
|
10,755
|
2023
|
2,209
|
2,957
|
1,419
|
2,413
|
760
|
9,758
|
Underlying operating profit (€
million)
|
|
|
|
|
|
|
2022
|
2,292
|
2,679
|
1,344
|
2,449
|
919
|
9,683
|
2023
|
2,331
|
2,792
|
1,496
|
2,460
|
852
|
9,931
|
Operating margin (%)
|
|
|
|
|
|
|
2022
|
17.6
|
16.6
|
8.6
|
32.4
|
9.8
|
17.9
|
2023
|
17.7
|
21.4
|
11.6
|
18.3
|
9.6
|
16.4
|
Underlying operating margin
(%)
|
|
|
|
|
|
|
2022
|
18.7
|
19.6
|
10.8
|
17.6
|
11.7
|
16.1
|
2023
|
18.7
|
20.2
|
12.3
|
18.6
|
10.8
|
16.7
|
*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.
Underlying operating profit
represents our measure of segment profit or loss as it is the
primary measure used for the purpose of making decisions about
allocating resources and assessing performance of segments.
Underlying operating margin is calculated as underlying operating
profit divided by turnover.
4. Segment information -
Geographical area
|
Fourth Quarter
|
Asia
Pacific Africa
|
The
Americas
|
Europe
|
Total
|
Turnover (€ million)
|
|
|
|
|
2022
|
6,640
|
5,374
|
2,597
|
14,611
|
2023
|
6,119
|
5,388
|
2,670
|
14,177
|
Change (%)
|
(7.9)
|
0.3
|
2.8
|
(3.0)
|
Impact of:
|
|
|
|
|
Acquisitions (%)
|
-
|
0.8
|
-
|
0.3
|
Disposals (%)
|
(0.2)
|
(2.6)
|
(0.1)
|
(1.0)
|
Currency-related items (%), of
which:
|
(9.4)
|
(6.9)
|
0.4
|
(6.7)
|
Exchange rates changes (%)
|
(10.6)
|
(11.7)
|
0.4
|
(9.1)
|
Extreme price growth in hyperinflationary markets*
(%)
|
1.4
|
5.4
|
-
|
2.6
|
Underlying sales growth
(%)
|
1.9
|
9.6
|
2.5
|
4.7
|
Price* (%)
|
1.1
|
2.0
|
9.4
|
2.8
|
Volume (%)
|
0.7
|
7.4
|
(6.3)
|
1.8
|
Full Year
|
Asia
Pacific Africa
|
The
Americas
|
Europe
|
Total
|
Turnover (€ million)
|
|
|
|
|
2022
|
27,504
|
20,905
|
11,664
|
60,073
|
2023
|
26,234
|
21,531
|
11,839
|
59,604
|
Change (%)
|
(4.6)
|
3.0
|
1.5
|
(0.8)
|
Impact of:
|
|
|
|
|
Acquisitions (%)
|
-
|
1.4
|
-
|
0.5
|
Disposals (%)
|
(1.9)
|
(2.6)
|
(1.9)
|
(2.1)
|
Currency-related items (%), of
which:
|
(8.8)
|
(4.5)
|
(0.6)
|
(5.7)
|
Exchange rates changes (%)
|
(10.5)
|
(8.0)
|
(0.6)
|
(7.8)
|
Extreme price growth in hyperinflationary markets*
(%)
|
2.0
|
3.8
|
-
|
2.2
|
Underlying sales growth
(%)
|
6.5
|
9.3
|
4.1
|
7.0
|
Price* (%)
|
5.3
|
5.7
|
12.8
|
6.8
|
Volume (%)
|
1.1
|
3.4
|
(7.7)
|
0.2
|
*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.
The effective tax rate for 2023 is
24.1% compared with 20.4% in 2022. The increase is primarily driven
by the favourable impact of the ekaterra Tea disposal which
benefited from the participation exemption in the Netherlands in
2022. The increase was partially offset by a benefit related to the
disposal of Dollar Shave Club in 2023.
The earnings per share calculations
are based on the average number of share units representing the
ordinary shares of PLC in issue during the period, less the average
number of shares held as treasury shares.
In calculating diluted earnings per
share and underlying earnings per share, a number of adjustments
are made to the number of shares, principally the exercise of share
plans by employees.
Earnings per share for total
operations for the twelve months were calculated as
follows:
|
Full
Year
|
|
2023
|
2022
|
EPS - Basic
|
|
|
Net profit attributable to
shareholders' equity (€ million)
|
6,487
|
7,642
|
Average number of shares (millions
of share units)
|
2,515.9
|
2,548.2
|
EPS - basic (€)
|
2.58
|
3.00
|
|
|
|
EPS - Diluted
|
|
|
Net profit attributable to
shareholders' equity (€ million)
|
6,487
|
7,642
|
Adjusted average number of shares
(millions of share units)
|
2,532.4
|
2,559.8
|
EPS - diluted (€)
|
2.56
|
2.99
|
|
|
|
Underlying EPS
|
|
|
Net profit attributable to
shareholders' equity (€ million)
|
6,487
|
7,642
|
Post-tax impact of non-underlying
items attributable to shareholders' equity (see note 2)
|
101
|
(1,074)
|
Underlying profit attributable to
shareholders' equity
|
6,588
|
6,568
|
Adjusted average number of shares
(millions of share units)
|
2,532.4
|
2,559.8
|
Underlying EPS - diluted
(€)
|
2.60
|
2.57
|
In calculating underlying earnings
per share, net profit attributable to shareholders' equity is
adjusted to eliminate the post-tax impact of non-underlying
items.
During the period the following
movements in shares have taken place:
|
Millions
|
Number of shares at 31 December 2022
(net of treasury shares)
|
2,529.0
|
Shares repurchased under the share
buyback programme
|
(31.7)
|
Net movements in shares under
incentive schemes
|
1.7
|
Number of shares at 31 December 2023
(net of treasury shares)
|
2,499.0
|
7. Acquisitions and
disposals
|
In 2023, the Group completed the
business acquisitions and disposals as listed below. The net
consideration for acquisitions in 2023 is €675 million (2022: €811
million for acquisitions completed during that year).
Deal completion date
|
Acquired/disposed
business
|
10 January 2023
|
Acquired 51% of Zywie Ventures
Private Limited ("OZiva"), a leading plant-based, and clean-label
consumer wellness brand focused on the need spaces such as
Lifestyle Protein, Hair & Beauty Supplements and Women's
health.
|
1 May 2023
|
Sold Suave brand in North America to
Yellow Wood Partners LLC. The Suave beauty and personal care brand
includes hair care, skin care, skin cleansing and deodorant
products.
|
1 August 2023
|
Acquired Yasso Holdings, Inc., a
premium frozen Greek yogurt brand in the United States offering a
high-quality range of low-calorie yet indulgent products. The
acquisition is aligned to the premiumisation strategy of Unilever's
Ice Cream Business Group.
|
1 November 2023
|
Sold Dollar Shave Club to Nexus
Capital Management LP.
|
On 1 May 2023, Unilever sold the
North America Suave business to Yellow Wood Partners LLC for
consideration of €592 million. A gain on disposal of
€497 million has been recognised as a non-underlying item (see
note 2).
On 18 December 2023, Unilever
announced that it has received a binding offer from Yellow Wood
Partners LLC to acquire Elida Beauty. Elida Beauty comprises more
than 20 beauty and personal care brands including Q-Tips, Caress,
Timotei and Tigi. Completion is expected by mid-2024.
On 22 December 2023, the Group
announced it had signed an agreement to acquire K18, a premium
biotech haircare brand in the US. The transaction completed on 1
February 2024 and the provisional accounting for this transaction,
including the valuation of assets and liabilities acquired, is
expected to be completed by H1 2024. This acquisition is another
step towards the optimisation of Unilever's portfolio into premium
segments.
Acquisitions
Effect on consolidated income
statement
The acquisition deals completed in
2023 have contributed €82 million to the Group turnover and €18
million to the Group operating profit since the date of
acquisition. If the acquisition deals completed in 2023 had all
taken place at the beginning of the year, Group turnover would have
been €59,709 million, and Group operating profit would have been
€9,780 million.
Effect on consolidated balance
sheet
The following table summarises the
consideration and net assets acquired in 2023. The fair values
currently used for opening balances are provisional. These balances
remain provisional due to there being outstanding relevant
information in regard to facts and circumstances that existed as of
the acquisition date and/or where valuation work is still
ongoing.
€ million
|
Total
2023
|
Intangible assets
|
430
|
Other non-current assets
|
4
|
Trade and other
receivables
|
25
|
Other current
assets(a)
|
56
|
Non-current
liabilities(b)
|
(114)
|
Current liabilities
|
(33)
|
Net assets acquired
|
368
|
Non-controlling interest
|
(20)
|
Goodwill
|
327
|
Total consideration
|
675
|
Of which:
|
|
Cash consideration paid
|
652
|
Deferred consideration
|
23
|
(a) Other current assets
include inventories of €18 million and cash and cash equivalents of
€30 million.
(b) Non-current liabilities
include deferred tax of €109 million.
Disposals
Total consideration for 2023
disposals is €578 million (2022: €4,606 million for disposals
completed during that year). The following table sets out the
effect of the disposals in 2023 and comparative year on the
consolidated balance sheet. The results of disposed businesses are
included in the consolidated financial statements up until their
date of disposal.
€ million
|
2023
|
2022
|
Goodwill and intangible
assets(a)
|
56
|
948
|
Other non-current
assets(b)
|
55
|
1,075
|
Current
assets(c)
|
108
|
833
|
Liabilities(d)
|
(144)
|
(649)
|
Net assets sold
|
75
|
2,207
|
(Gain)/loss on recycling of currency
retranslation on disposal
|
14
|
65
|
Profit/(loss) on sale attributable
to Unilever
|
489
|
2,334
|
Consideration
|
578
|
4,606
|
Of which:
|
|
|
Cash
|
472
|
4,606
|
Cash balances of businesses
sold
|
5
|
20
|
Non-cash items and deferred
consideration
|
101
|
(20)
|
(a) 2023 mainly related to the
disposals of Suave and Dollar Shave Club.
(b) 2023 includes property,
plant and equipment of €42 million mainly related to the disposal
of Dollar Shave Club.
(c) 2023 includes
inventories of €88 million related to the disposals of Suave and
Dollar Shave Club.
(d) 2023 includes €123 million
of trade payables.
On 10 February 2022, we announced a
share buyback programme of up to €3 billion to be completed over
2022 and 2023. During 2023, the Group repurchased 31,734,256
ordinary shares which were held by Unilever as treasury shares.
Consideration paid for the repurchase of shares including
transaction costs was €1,507 million and was recognised in other
reserves.
The Group's Treasury function aims
to protect the Group's financial investments, while maximising
returns. The fair value of financial assets is the same as the
carrying amount for 2023 and 2022. The Group's cash resources
and
other financial assets are shown below.
|
31
December 2023
|
31
December 2022
|
€ million
|
Current
|
Non-current
|
Total
|
Current
|
Non-current
|
Total
|
Cash and cash equivalents
|
|
|
|
|
|
|
Cash at bank and in hand
|
2,862
|
-
|
2,862
|
2,553
|
-
|
2,553
|
Short-term
deposits(a)
|
1,181
|
-
|
1,181
|
1,743
|
-
|
1,743
|
Other cash equivalents
|
116
|
-
|
116
|
30
|
-
|
30
|
|
4,159
|
-
|
4,159
|
4,326
|
-
|
4,326
|
Other financial assets
|
|
|
|
|
|
|
Financial assets at amortised
cost(b)
|
961
|
454
|
1,415
|
772
|
232
|
1,004
|
Financial assets at fair value
through other comprehensive income(c)
|
151
|
458
|
609
|
-
|
407
|
407
|
Financial assets at fair value
through profit or loss:
|
|
|
|
|
|
|
Derivatives
|
37
|
75
|
112
|
238
|
51
|
289
|
Other(d)
|
582
|
399
|
981
|
425
|
464
|
889
|
|
1,731
|
1,386
|
3,117
|
1,435
|
1,154
|
2,589
|
Total financial
assets(e)
|
5,890
|
1,386
|
7,276
|
5,761
|
1,154
|
6,915
|
(a) Short-term deposits typically have a maturity of up to 3
months.
(b) Current financial assets at amortised cost include short term
deposits with banks with maturities longer than three months and
loans to joint venture entities. Non-current financial assets at
amortised cost include judicial deposits of €227 million (2022:
€199 million).
(c) Included within non-current financial assets at fair value
through other comprehensive income are equity
investments.
(d) Other financial assets at fair value through profit or loss
include money market funds, marketable securities, other capital
market instruments
and investments in financial institutions in North America, North
Asia, South Asia and Europe.
(e) Financial assets exclude trade and other current
receivables.
The Group is exposed to the risks of
changes in fair value of its financial assets and liabilities. The
following tables summarise the fair values and carrying amounts of
financial instruments and the fair value calculations by
category.
|
Fair
value
|
Carrying
amount
|
€ million
|
As at 31
December 2023
|
As at 31
December 2022
|
As at 31
December 2023
|
As at 31
December 2022
|
Financial assets
|
|
|
|
|
Cash and cash equivalents
|
4,159
|
4,326
|
4,159
|
4,326
|
Financial assets at amortised
cost
|
1,415
|
1,004
|
1,415
|
1,004
|
Financial assets at fair value
through other comprehensive income
|
609
|
407
|
609
|
407
|
Financial assets at fair value
through profit and loss:
|
|
|
|
|
Derivatives
|
112
|
289
|
112
|
289
|
Other
|
981
|
889
|
981
|
889
|
|
7,276
|
6,915
|
7,276
|
6,915
|
Financial liabilities
|
|
|
|
|
Bank loans and overdrafts
|
(506)
|
(519)
|
(506)
|
(519)
|
Bonds and other loans
|
(26,112)
|
(25,136)
|
(26,692)
|
(26,512)
|
Lease liabilities
|
(1,395)
|
(1,408)
|
(1,395)
|
(1,408)
|
Derivatives
|
(494)
|
(631)
|
(494)
|
(631)
|
Other financial
liabilities
|
(535)
|
(418)
|
(535)
|
(418)
|
|
(29,042)
|
(28,112)
|
(29,622)
|
(29,488)
|
For assets and liabilities which are
carried at fair value, the classification of fair value
calculations by category is summarised below:
|
As at 31
December 2023
|
As at 31
December 2022
|
€ million
|
Level
1
|
Level
2
|
Level
3
|
Level
1
|
Level
2
|
Level
3
|
Assets at fair value
|
|
|
|
|
|
|
Financial assets at fair value
through other comprehensive income
|
163
|
4
|
442
|
5
|
3
|
399
|
Financial assets at fair value
through profit or loss:
|
|
|
|
|
|
|
Derivatives(a)
|
-
|
149
|
-
|
-
|
378
|
-
|
Other
|
582
|
-
|
399
|
428
|
-
|
461
|
Liabilities at fair value
|
|
|
|
|
|
|
Derivatives(b)
|
-
|
(559)
|
-
|
-
|
(784)
|
-
|
Contingent consideration
|
-
|
-
|
(157)
|
-
|
-
|
(164)
|
(a) Includes €37 million (2022: €89 million) derivatives, reported
within trade receivables, that hedge trading activities.
(b) Includes €(65) million (2022: €(153) million) derivatives,
reported within trade creditors, that hedge trading
activities.
There were no significant changes in
classification of fair value of financial assets and financial
liabilities since 31 December 2022. There were also no significant
movements between the fair value hierarchy classifications since 31
December 2022.
The fair value of trade receivables
and payables is considered to be equal to the carrying amount of
these items due to their short-term nature. The fair value of
financial assets and financial liabilities (excluding listed bonds)
is considered to be same as the carrying amount for 2023 and
2022.
Calculation of fair
values
The fair values of the financial
assets and liabilities are defined as the price that would be
received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Methods and
assumptions used to estimate the fair values are consistent with
those used in the year ended 31 December 2022.
10. Assets and liabilities
held for sale
|
On 18 December 2023, Unilever
announced that it has received a binding offer from Yellow Wood
Partners LLC to acquire Elida Beauty. Elida Beauty comprises more
than 20 beauty and personal care brands including Q-Tips, Caress,
Timotei and Tigi. As a result, the assets and liabilities of Elida
Beauty have been classified as held for sale as at 31 December
2023. Following the classification of assets and liabilities as
held for sale, they are recognised as current on the balance
sheet.
€ million
|
2023
|
2022
|
Property, plant and equipment held
for sale(a)
|
2
|
4
|
|
|
|
Non-current assets
|
|
|
Goodwill and intangibles
|
534
|
2
|
Property, plant and
equipment
|
21
|
20
|
Other non-current assets
|
1
|
-
|
|
556
|
22
|
Current assets
|
|
|
Inventories
|
80
|
-
|
Trade and other
receivables
|
47
|
2
|
Current tax assets
|
4
|
-
|
Cash and cash equivalents
|
2
|
-
|
|
133
|
2
|
Assets held for sale
|
691
|
28
|
|
|
|
Current liabilities
|
|
|
Trade payables and other current
liabilities
|
24
|
2
|
Current tax liabilities
|
2
|
-
|
Financial liabilities due within one
year
|
-
|
2
|
|
26
|
4
|
Non-current liabilities
|
|
|
Financial liabilities due after one
year
|
4
|
-
|
Deferred tax liabilities
|
145
|
-
|
|
149
|
-
|
Liabilities held for sale
|
175
|
4
|
(a) Includes manufacturing assets held for sale.
The Board has declared a quarterly
interim dividend for Q4 2023 of £0.3647 per Unilever PLC ordinary
share or €0.4268 per Unilever PLC ordinary share at the applicable
exchange rate issued by WM/Reuters on 6 February 2024.
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):
|
£0.3647
|
Per Unilever PLC ordinary share
(traded on Euronext in Amsterdam):
|
€0.4268
|
Per Unilever PLC American Depositary
Receipt:
|
US$0.4582
|
The euro and US dollar amounts above
have been determined using the applicable exchange rates issued by
WM/Reuters on 6 February 2024.
US dollar cheques for the quarterly
interim dividend will be mailed on 22 March 2024 to holders of
record at the close of business on 23 February
2024.
The quarterly dividend calendar for
the remainder of 2024 will be as follows:
|
Announcement Date
|
Ex-Dividend Date
|
Record
Date
|
Payment
Date
|
Q4 2023 Dividend
|
08
February 2024
|
22
February 2024
|
23
February 2024
|
22 March
2024
|
Q1 2024 Dividend
|
25 April
2024
|
16 May
2024
|
17 May
2024
|
07 June
2024
|
Q2 2024 Dividend
|
25 July
2024
|
08 August
2024
|
09 August
2024
|
06
September 2024
|
Q3 2024 Dividend
|
24
October 2024
|
07
November 2024
|
08
November 2024
|
06
December 2024
|
12. Events after the balance
sheet date
|
As disclosed elsewhere in this
report, the acquisition of K18 completed on 1 February
2024.