Unilever Plc · LSE:ULVR
Unilever — FY2007 Earnings Presentation
38 slides from Unilever's earnings presentation, 2008
Slide 1: Unilever Q4 and 2007 Full Year Roadshow
Unilever Q4 and 2007 Full Year Roadshow Handout version 0
Slide 2: Unilever Q4 2007 Results
Unilever Q4 2007 Results Highlights 4 Drivers of Growth 26 Strong Organic Growth 5 Clear 27 Growth by Region 6 Ponds Age Miracle 28 Growth by Category 7 Dove Pro.Age 29 Innovation Driving Growth 8 Small & Mighty in Europe 30 2007 Operating Margin 9 Domestos Zero Limescale 31 Q4 Operating Margin 10 K
Slide 3: Safe Harbour Statement
Safe Harbour Statement This presentation 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' or the negative of these terms and other
Slide 4: 3
3
Slide 5: Highlights
Highlights • Third consecutive year of accelerating growth • Underlying margin improvement • Accelerated restructuring programme • Shaping the portfolio • Organisational simplification • Supply chain rationalisation 4
Slide 6: Strong Organic Growth
Strong Organic Growth Underlying sales growth 7% 6% 5% 4% 3% 2% 1% 0% * * 05 05 06 06 06 06 07 07 07 07 05 05 20 20 20 20 20 20 20 20 20 20 20 20 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q4 Annualised growth rate * days adjusted 5
Slide 7: Underlying Sales Growth by Region
Underlying Sales Growth by Region Americas Asia Africa Q4 2007 Q4 YTD USG 3.7% 4.1% USG 10.0% 11.1% 29% 33% 38% Europe Q4 2007 USG 5.5% 2.8% 6
Slide 8: Underlying Sales Growth by Category
Underlying Sales Growth by Category Ice Cream Home Care and Beverages Q4 2007 Q4 2007 USG 5.6% 6.1% USG 5.7% 4.2% 18% 19% 28% 35% Savoury, Dressings and Spreads Personal Care Q4 2007 Q4 2007 USG 7.2% 6.7% USG 5.8% 5.0% 7
Slide 9: Innovation Driving Growth
Innovation Driving Growth Rapid roll-outs across key markets Faster deployment of new technologies Better transfer of mixes Vitality-focused innovation 8
Slide 10: Operating Margin Development: 2007
Operating Margin Development: 2007 2006 2007 Change Operating margin 13.6% 13.1% (0.5)% Including RDIs* (0.6)% (1.4)% (0.7)% Underlying change 0.2% Key drivers: A&P 0.0% Savings 2.4% Cost/price/mix (2.2)% * Restructuring, disposals and one-off items (2006 gains on US health care and UK pensions) 9
Slide 11: Operating Margin Development: Q4
Operating Margin Development: Q4 2006 2007 Change Operating margin 10.9% 11.1% 0.2% Including RDIs* (1.6)% (1.6)% 0.0% Underlying change 0.2% Key drivers: A&P (0.6)% Savings 3.2% Cost/price/mix (2.4)% * Restructuring, disposals and one-off items (2006 gains on US health care and UK pensions) 10
Slide 12: Commodity Costs
Commodity Costs Commodity cost impact on margin 350 300 250 200 bps 330 150 260 100 220 150 160 160 50 100 120 80 0 2003 2004 2005 2006 2007 Q1 07 Q2 07 Q3 07 Q4 07 Outlook: ≥ rate of Q4 2007 well into 2008 11
Slide 13: Commodity Costs – Edible Oils
Commodity Costs – Edible Oils 12
Slide 14: Accelerated Restructuring Programme
Accelerated Restructuring Programme Shaping the portfolio Disposals * completed/ announced Brazil Spreads Brands US Seasonings France Cheese Disposal NA Underway Laundry Global JV Extended RTD Tea Indonesia Russia Acquisitions Fruit Drinks Ice Cream * completed 1 Jan 2008 13
Slide 15: Accelerated Restructuring Programme
Accelerated Restructuring Programme • Organisational simplification • 14 MCOs in place • Announced 4 new MCOs in Europe - Belgium, Netherlands, Luxembourg - UK, Ireland - Germany, Austria, Switzerland - Czech Republic, Hungary • Supply chain rationalisation • Streamline or closure of 10 sites - UK,
Slide 16: Accelerating Change – Progress To Date
Accelerating Change – Progress To Date • Savings • Target of €1.5bn reduction p.a. by end 2010 • Achieved €0.3bn in 2007 - Other savings realised via buying and local efficiency programmes takes total savings to €1bn • Restructuring Costs • Target of c. 250bps p.a. over 2007-2009: c. €1bn p.a., €3bn
Slide 17: Drivers of EPS Growth
Drivers of EPS Growth % Operating profit (3) Finance costs 3 JVs, associates and non- % current investments 1 Underlying sales growth 5 Preference share provision 5 Currency and disposals (4) Tax rate 4 Other** 2 Operating margin pre-RDIs 2 EPS from continuing 12 RDIs* (6) operations (3) Discontinue
Slide 18: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow • Competitive balance sheet – ‘strong single A’ • Cash flow from operating activities €5.2bn • Net debt €8.3bn • €1.5bn share buy-backs completed in 2007 • 2008 share buy-back programme ≥ €1.5bn 17
Slide 19: Business Priorities
Business Priorities 1. Maintain competitiveness 2. Drive for sustainable margin improvement 3. Invest selectively to gain market share 18
Slide 20: 2008 Outlook
2008 Outlook 2008 to mark a further step towards our 2010 goals • 2010 goals • Operating margin > 15% • Consistent, competitive growth at 3-5% p.a. • In 2008 • Underlying sales growth towards top end of 3-5% range • Further underlying improvement in operating margin 19
Slide 21: 20
20
Slide 22: Delivering long term objectives
Strategy Delivering long term objectives 21
Slide 23: Our portfolio
Our portfolio Leading Category Positions Savoury Spreads Dressings Tea World Number 1 Ice Cream World Number 2 Skin Deodorants Local strength Laundry Daily Hair Care Household Care Oral Care Our 12 €1bn+ brands 22
Slide 24: Our Growth Priorities
Our Growth Priorities Deodorants, Skin, Hair Savoury, Ice Cream, Tea Vitality within Foods D&E: Foods, Home Care Russia and China 23
Slide 25: Aligned Organisation
Aligned Organisation Unilever Executive Corporate strategy Portfolio priorities Performance management Regions Categories Functions Go to market Brand and category strategies Functional excellence Customer management Innovation Business support R&D Simplification Disciplined execution, speed, effect
Slide 26: 25
25
Slide 27: Drivers of growth: Innovation
Drivers of growth Innovation 26
Slide 28: Clear
Clear Complete antidandruff and scalp care regime Centrally developed, identically presented simultaneously across China, Brazil, Russia, Arabia and Turkey 27
Slide 29: Ponds Age Miracle
Ponds Age Miracle Skin that looks and feels younger A revolutionary range of anti- ageing products designed specifically for the needs of Asian skin 28
Slide 30: Dove Pro.Age
Dove Pro.Age Beauty has no age limit The first collection of hair, skin and deodorant beauty products designed to reflect the unique needs of women in their later years 29
Slide 31: Small & Mighty in Europe
Small & Mighty in Europe A revolutionary 3-times-more concentrated laundry detergent A new breakthrough product with perceivably better cleaning, and better convenience, at the same price per wash Cleans a whole wash-load with just one small capful 30
Slide 32: Domestos Zero Limescale
Domestos Zero Limescale A powerful, superior performance limescale remover Completely destroys tough, germ-filled limescale Three times thicker than any other product on the market, it grips to limescale even on vertical surfaces and under the water line, so it keeps on working 31
Slide 33: Knorr Eat Colour Soups
Knorr Eat Colour Soups ‘Colour is a sign of goodness in nature, so the more colour you eat, the better it is for you’ 32
Slide 34: Knorr Bouillon Gel
Knorr Bouillon Gel Launched in China with local insight into soup preparation 33
Slide 35: Heart Health
Heart Health Omega 3 plus Packed with more omega 3 than any other spread or minidrink pro.activ (Promise activ) Spreads, milk, yoghurt and mini-drinks clinically proven to lower cholesterol 34
Slide 36: Hellmann’s Light
Hellmann’s Light Delicious light mayonnaise with only 5% fat With unique citrus fibre technology 35
Slide 37: Moo and Milk Time
Moo and Milk Time Delicious ice cream for kids with as much calcium as two glasses of milk + + 36
Slide 38: Lipton Linea
Lipton Linea A unique slimming tea twice as rich in catechins to help maintain your silhouette 37