Unilever PLC · LSE:ULVR
Unilever — Sanford C. Bernstein Strategic Decisions Conference 2010
32 slides from Unilever's conference presentation, Dec 23, 2010
Slide 1: Sanford C. Bernstein Strategic Decisions Conference
Sanford C. Bernstein Strategic Decisions Conference Paul Polman - CEO
Slide 2: Safe harbour statement
Safe harbour statement This announcement may contain forward-looking statements, including ‘forward-looking statements’ within the meaning of the United States Private Securities Litigation Reform Act of 1995. Words such as ‘expects’, ‘anticipates’, ‘intends’, ‘believes’ or the negative of these ter
Slide 3: Value shares improving after years of decline
Value shares improving after years of decline 20 bps change 0 -20 2002 2003 2004 2005 2006 2007 2008 2009 Source: Euromonitor
Slide 4: Driven by volume share improvements
Driven by volume share improvements 80 40 bps change 0 -40 L12 MAT -80 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 12-week volume share change vs. prior year
Slide 5: Bigger, better innovation
new Dove Dove MEN MEN CLEAN COMFORT BODY AND BODY AND BODY AND FACE WASH FACE WASH FACE WASH . ™ ¢ + MICRO! MOISTURE” tesopse avy ee Weis : : wks ~ Clinically proven to fight skin dryness better than any regular men’s BW. =
Slide 6: Highest ever innovation rate
Highest ever innovation rate 33% H1 2010
Slide 7: Faster roll outs
Faster roll outs Lifebuoy Clear Knorr Stock Pot 32 markets 35 markets 19 markets
Slide 8: Execution is improving: Customer Service
Execution is improving: Customer Service On-shelf Customer service levels targets availability up on-track # Top 20 countries achieving 20 targets +290 bps 15 10 5 0 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Jan-08 Jul Jan-09 Jul
Slide 9: Execution is improving: Investing in Product Quality
Execution is improving: Investing in Product Quality € 100m incremental investment in Product Quality 2009 and 2010
Slide 10: Execution is improving: Advertising Effectiveness
Execution is improving: Advertising Effectiveness Communication Scores % • Improving the quality of our 21 advertising 24 71 • Increased use of digital 50 media 2008 Q2 2010 • A&P up by c. €500m in H1, Good Satisfactory Poor €300m in Advertising
Slide 11: Simpler, leaner more cost effective
Simpler, leaner more cost effective No of people at manager level and above (thousands) • Fewer layers and fewer people 1,000 headcount • Salaries frozen for 2nd consecutive reduction year • Over €1bn savings in 2010 • Taking out cost which the consumer is not prepared to pay for 2008 2009
Slide 12: Sharpening the performance culture
Sharpening the performance culture • Right people in the right jobs • More differentiated reward • More accountability • More bias for action
Slide 13: Delivering what we have said
Delivering what we have said Volume growth Categories Top Brands MCOs 11 / 11 12 / 13 18 / 22 • Profitable volume growth • Underlying operating margin improvement • Strong cash flow
Slide 14: Your results are strong but can you continue to grow at these levels?
Delivering what we have said Your results are strong but can you continue to grow at these levels?
Slide 15: Unilever, the Emerging Market Company
Unilever, the Emerging Market Company 52% 15% 25% 35% 45% 55% Source: Annual Report & Accounts, analysts estimates, Unilever estimates
Slide 16: Consumption levels in emerging markets are a fraction of those in developed markets
Consumption levels in emerging markets are a fraction of those in developed markets US$ Consumption per capita Market Market Market Size Size Size $31 bn $17 bn $49 bn 23 17 11 2.2 0.3 3.6 Bath and Shower Deo Laundry Detergents Asia Pacific Western Europe Source: Euromonitor
Slide 17: Consistent results: Volume growth accelerating
Consistent results: Volume growth accelerating 20% 52% of Unilever of Unilever 16% 14% 12% 10% 8% 6% 4% 2% 0% -2% Volume Price Growth Growth -4% 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 H1 '10
Slide 18: Plenty of room in the emerging markets pie
Plenty of room in the emerging markets pie D&E market share vs Spreads 15% key competitors Ice Cream 18% Dressings 22% Unilever P&G Soups 26% L'Oréal Deo 30% Colgate Skin H&B 9% Reckitt HHC 8% Beiersdorf Tea 17% Nestlé CCA 12% Danone Others Skin Cleansing 23% Hair 15% Oral 12% Laundry 22% Skin Face
Slide 19: Number 1 or 2 positions in over 80% of turnover
Number 1 or 2 positions in over 80% of turnover World Number 1 Savoury Dressings Local Strength World Number 2 Tea Oral Care Laundry Ice Cream Household Cleaning Spreads Daily Hair Care Deodorants Mass Skin
Slide 20: Consumers in developed markets will buy more if you innovate!
Consumers in developed markets will buy more if you innovate ! Axe Hair United States Knorr Stock Pot – Western Europe €50m Turnover Innovation UK market share +11%
Slide 21: Reshaping the portfolio in developed markets
Reshaping the portfolio in developed markets Sara Lee completion Disposal of Findus Italy expected in Q4’10 announced – Brunch brand disposal completed – Du Darfst licensing under way – More portfolio change over time
Slide 22: Your growth is good but the quality of growth is suspect
Delivering what we have said Your growth is good but the quality of growth is suspect.
Slide 23: Where competition has been greatest… our performance has been best
Where competition has been greatest… Market Value Share Difference Turkey Indonesia Brazil Home Care Personal Care Home Care 10% 13% 42% 45% 52% 53% 2008 2009 2010 MAT 2008 2009 2010 MAT 2008 2009 2010 MAT Unilever Nearest Competitor Unilever Nearest Competitor Unilever Nearest Competitor … our perf
Slide 24: Growth underpinned by discipline across all elements of marketing mix
Growth underpinned by discipline across all elements of marketing mix New Channels: Digital Gross margins increasing Investment Up 77% H1’10 • Pricing stable H1 2010 290bps 310bps 240bps 120bps • Underlying price growth -190bps -25bps turning positive by the end 2010 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2
Slide 25: The cost of competition is increasing. Can you stay the course?
Delivering what Thewecost haveof said competition is increasing. Can you stay the course?
Slide 26: A new competitive Unilever is emerging
A new competitive Unilever is emerging Managing Leveraging We will stay the business our global with a long competitive scale term focus Cost savings Reinvesting programmes to build will continue brand aggressively equities 26
Slide 27: Are you fit to compete?
Delivering what we have said Are you fit to compete?
Slide 28: Making good progress UEx
Making good progress Unilever today 3 • Fewer touch points, faster Regions/ 22MCO’s decision making • Compensation schemes which One reward excellence and Global Shared Services UEx Category Organis. encourage accountability • Bias for action Global Support Functions
Slide 29: China: Narrowing the gap to market leaders
China: Narrowing the gap to market leaders Market Value Share Difference China China China Savoury Home Care Personal Care 20% 16% 24% 22% 11% 4% 2008 2009 2010 MAT 2008 2009 2010 MAT 2008 2009 2010 MAT Unilever Market Leader Unilever Market Leader Unilever Market Leader
Slide 30: Not yet best in class
Not yet best in class • Competitors improving too • Genesis programme to come ….but we are closing the gaps to best in class
Slide 31: Our Priorities Remain Unchanged
Our Priorities Remain Unchanged • Continue to drive profitable volume growth • Steady and sustainable improvement in full year underlying operating margin • Strong cash flow
Slide 32: Q&A
Q&A
Unilever — Sanford C. Bernstein Strategic Decisions Conference 2010 on 6ix