Statement from Hein Schumacher, CEO
“We have delivered a fourth consecutive quarter of positive, improved volume growth, with each of our Business Groups driving higher volumes year-on-year.
“Underlying sales grew 4.5%, led by our Power Brands, with particularly strong performances from Dove, Liquid I.V., Comfort and Magnum. Price growth continued to moderate in line with our expectations.
“We are still in the early stages of transforming our performance as we execute the Growth Action Plan at pace – focused on doing fewer things, better and with greater impact. We are starting to see the positive impact from scaling fewer, bigger innovations across our markets supported by increased brand investment. We are taking decisive actions, where we see operational or market challenges to ensure we are well positioned for consistent and improved performance.
“As part of the Group’s overall transformation, we are implementing a comprehensive productivity programme and the separation of Ice Cream, both of which are progressing as planned.
“We are on track to deliver our 2024 outlook and are confident that the steps we are taking will help to transform Unilever over time into a consistently higher performing business.”
Outlook
Our full year 2024 outlook is unchanged.
We continue to expect underlying sales growth (USG) for 2024 to be within our multi-year range of 3% to 5%, with the majority of the growth being driven by volume.
Underlying operating margin for the full year is expected to be at least 18%, with increasing investment behind our brands. We expect the year-on-year margin progression in the second half to be smaller than in the first half.
Third Quarter Review: Unilever Group
Growth
Underlying sales growth in the third quarter was 4.5%, against the backdrop of slower market growth. Underlying volume growth (UVG) increased to 3.6% in Q3, the fourth consecutive quarter of positive and improving volume growth. All business groups achieved positive volume growth. As expected, underlying price growth continued to moderate to 0.9% in Q3.
The Power Brands performed strongly with 5.4% underlying sales growth, driven by volume growth of 4.3%. Our other brands also delivered volume growth of 1.3% in Q3, up from -1.6% in H1.
Beauty & Wellbeing grew underlying sales 6.7%, with volume growth of 5.7%. Health & Wellbeing and Prestige Beauty combined delivered a fifteenth consecutive quarter of double-digit, volume-led growth. Strong growth in Health & Wellbeing more than offset softer growth in Prestige, reflecting the continued slowdown in the US and China beauty markets. Personal Care grew 4.4% with 3.1% from volume, driven by a strong Dove performance. Home Care underlying sales increased by 1.9%, with 3.3% volume growth more than offsetting continued negative price growth linked to commodity cost deflation.
Nutrition grew underlying sales 1.5%, with muted volume growth of 0.4% amidst moderating prices and market slowdown. Ice Cream grew 9.8%, with 6.7% from volume and 2.9% from price. This improved performance reflects the continued focus on operational improvements alongside strong innovations, amplified by a weak comparator.
Developed markets – 43% of Group turnover – grew underlying sales 6.9% with 6.8% from volume and 0.1% from price. Volume growth was broad-based and reflected strong growth in Beauty & Wellbeing in North America, strong growth in Home Care in Europe and a marked volume improvement in Ice Cream. As expected, price growth moderated further.
Emerging markets – 57% of Group turnover – grew underlying sales 2.9%, with 1.4% from volume and 1.5% from price. India grew 2.3% with volume growth of 3.4%. Underlying price growth of -1.0% in India lapped a one-off indirect tax benefit in the prior year, without which Q3 UPG would have been flat. Latin America grew 3.8%. This slower rate of growth reflected a decline in the laundry powders market in Brazil and low-single digit growth in Mexico after eight quarters of double-digit growth. Africa and Turkey continued to deliver double-digit growth.
China declined low-single digit with market weakness across categories and in the context of softer markets, we are transforming our go-to-market approach. South East Asia declined mid-single digit, driven by an -18% decline in Indonesia which was only partially offset by volume-led growth in Philippines and Thailand.
We are making decisive interventions to fix our long-standing issues in Indonesia, which include removing price instability across channels and resetting stock levels in retail to what we consider optimum levels. We expect to see the benefits of the changes in Indonesia and China from the second half of 2025.
Turnover of €15.2 billion was in line with the prior year, as underlying sales growth was offset by a currency impact of -2.8% and -1.5% from disposals net of acquisitions.
Progress on Ice Cream separation and productivity programme
In March, we announced the separation of Ice Cream and the launch of a major productivity programme to strengthen the company and substantially improve our efficiency and effectiveness.
Separation activity is on track to complete by the end of 2025. We are progressing with the legal entity set up, the standalone operating model and the carve-out financials.
In July, we communicated internally on the changes planned within the productivity programme to simplify our business and further evolve our category-focused operating model. We have started the implementation in those countries where the consultation with the respective works councils completed.
Capital allocation
On 2 August 2024, we completed the sale of our stake in Qinyuan Group (also known as “Truliva”), which offers a range of water purification solutions to households in China, to Yong Chao Venture Capital Co., Ltd.
On 10 October 2024, we completed the sale of our Russian subsidiary to Arnest Group. The sale includes all of Unilever’s business in Russia and its four factories, as well as our business in Belarus.
In February 2024, we announced a share buyback programme of up to €1.5 billion to be conducted during 2024. The first tranche of €700 million completed in August. The second tranche of up to €800 million commenced in September and will complete in December 2024.
After the quarterly interim dividend for the second quarter was raised by 3.0% to €0.4396, the quarterly interim dividend for the third quarter is maintained at this level.
Business Groups
Beauty & Wellbeing (21% of Q3 turnover)
In Beauty & Wellbeing, we focus 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.
Beauty & Wellbeing delivered a strong performance, with underlying sales up 6.7%, driven by volume up 5.7% and price up 0.9%.
Hair Care delivered low-single digit growth with low-single digit volume growth. Dove continued to deliver volume-led growth following the first half launch of Scalp + Hair Therapy, while TRESemmé grew mid-single digit with continued success of its treatments and styling range. Our largest hair care brand, Sunsilk, grew low-single digit and Clear achieved high-single digit growth outside China, but was flat overall.
Core Skin Care grew mid-single digit led by double-digit volume growth in the United States. Dove achieved strong double-digit growth, which included the launch of High Potency Body Serums and 3-in-1 face care treatments in Brazil. Pond’s grew double-digit supported by our Bright Miracle and Age Miracle face care ranges, featuring advanced technologies for clearer, more youthful skin. Vaseline continued to perform well, supported by the continued rollout of premium innovations like Radiant X and Gluta Hya, as well as the launch of Pro VitaB3 Serum-Burst Lotion in the United States.
Health & Wellbeing and Prestige Beauty combined delivered double-digit growth for the fifteenth consecutive quarter. This was led by very strong growth in Health & Wellbeing, which offset lower growth in Prestige Beauty reflecting the continued slowdown in the United States and China beauty markets. Liquid I.V. delivered another quarter of strong double-digit growth, driven by a successful summer season and continued international expansion. Nutrafol and Olly also saw strong double-digit growth, with Olly’s female health supplements performing well in China.
Hourglass led Prestige growth with strong double-digit growth, driven by hero products such as Vanish Airbrush Concealer and Veil Hydrating Skin Tint, while Paula’s Choice was impacted by the market slowdown.
Personal Care (22% of Q3 turnover)
In Personal Care, we focus 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.
Personal Care delivered volume-led growth with underlying sales up 4.4%, driven by volume up 3.1% and price up 1.3%.
Deodorants grew high-single digit, which was volume-led. Latin America led growth with double-digit volume, while Europe and North America saw mid-single digit increases. Dove continued to grow double-digit with strength across both core women and Dove Men+Care ranges, including our expansion into the whole body deodorants market in the first half. Axe and Rexona continued to grow, driven by the ongoing success of our fine fragrance and clinical ranges.
Skin Cleansing grew low-single digit fully driven by volume. In Europe, we achieved high-single digit growth driven by volume increases, while in the United States, we saw mid-single digit growth. Dove delivered high-single digit growth, supported by the first-half relaunch of Dove’s body wash in Europe and the launch of Dove’s premium body wash range infused with skincare serums in the United States. Growth was tempered by deflation in India, category declines in China, and operational challenges in Indonesia.
Oral Care grew low-single digit with mid-single digit growth in Europe partially offset by a decline in Indonesia.
Home Care (20% of Q3 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.
Home Care underlying sales grew 1.9%, with volume growth of 3.3%, partially offset by a -1.4% price decline.
Fabric Cleaning declined low-single digit as slightly positive volume was more than offset by low-single digit negative price. Europe led with high-single digit growth, driven by double-digit volume. Persil Wonder Wash, featuring our patented Pro-S technology designed for short cycle washes, continued to perform well and was launched in Turkey in Q3. In India, we grew high-single digit driven by strong volumes and double-digit growth in liquids led by our Surf Excel Matic and Rin ranges. Brazil saw declines in both price and volume due to a softening market and commodity deflation, particularly affecting our powders portfolio.
Home & Hygiene grew mid-single digit led by volume. Domestos grew double-digit led by momentum in our Power Foam range which expanded to new geographies including Poland and Turkey. Cif also maintained double-digit, volume-led growth.
Fabric Enhancers grew double-digit with strong volumes slightly offset by negative price. Comfort continued to deliver double-digit volume growth following the successful first-half launch of our new, Botanicals and Elixir ranges, with our patented CrystalFresh technology.
Nutrition (21% of Q3 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.
Nutrition underlying sales grew 1.5%, driven by positive price and volume.
Scratch Cooking Aids grew low-single digit, led by mid-single digit growth in Knorr. In Latin America, we achieved double-digit growth, driven by strong performance from our next generation bouillon and seasoning ranges with enhanced flavours and micronutrients. In the United States, we saw mid-single digit growth, entirely volume-driven, benefiting from social-first campaigns promoting home cooking with bouillon.
Dressings was flat with low-single digit volume offset by negative price. Hellmann’s delivered low-single digit volume growth which was offset by negative price as promotional intensity increased. Flavoured mayo continued to perform well with rapid geographic expansion, including recent launches in Argentina and the Philippines.
Unilever Food Solutions grew low-single digit with positive volumes despite a slowdown in China. We continued to expand our digital selling programme and benefited from the launch of Hellmann’s Professional Mayo in Europe and Brazil, specifically designed for professional kitchens.
Ice Cream (16% of Q3 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. In March, we announced the planned separation of Ice Cream which we expect to be completed by the end of 2025. The separation will create a world-leading business, operating in a highly attractive category with five of the top ten selling global ice cream brands.
Ice Cream underlying sales grew 9.8%, with 6.7% from volume and 2.9% from price. This improved performance was driven by operational strengthening, including distribution gains and optimised promotional activities, alongside strong innovations. These improvements were amplified by a weak Q3 2023 comparator.
In-home grew double-digit led by double-digit volume growth in Europe. Magnum’s first bite-sized innovation, Bon Bons, along with Ben & Jerry’s Peaces and Yasso’s Poppables, performed well. These premium micro-format innovations cater to the demand for smaller, frequent indulgences, driving growth in the Ice Cream category year-round.
Out-of-home grew high-single digit with positive volume and price growth. Magnum achieved double-digit growth, with continued strong performance of its premium ‘Pleasure Express’ range, featuring Euphoria, Wonder, and Chill. Ben & Jerry’s and Cornetto saw high-single digit growth, supported by Cornetto’s first global relaunch with enhanced formulation and new packaging.