Improved performance led by volume growth and gross margin expansion

Statement from Hein Schumacher, CEO

“Today’s results reflect a year of significant activity as we focused on transforming Unilever into a consistently higher performing business.

“Under the Growth Action Plan, we committed to doing fewer things, better and with greater impact. We executed the plan at pace and made progress in 2024. Underlying sales grew 4.2% with volumes up 2.9%, led by our Power Brands, with particularly strong performances from Dove, Comfort, Vaseline and Liquid I.V. Fewer, bigger innovations helped to deliver volume growth consistently above 2% in each quarter. All Business Groups delivered positive volume growth for the year. Growth was underpinned by gross margin expansion of 280bps, fuelling increases in brand investment and profitability.

“We continue to sharpen our portfolio, allocating capital to premium segments by acquiring scalable brands in attractive markets, such as K18 and Minimalist, and announcing the divestment of local food brands such as Unox and Conimex, as we focus our Foods portfolio on cooking aids and condiments categories.

“The comprehensive productivity programme we announced in March is being implemented at pace and we are ahead of plan in helping to create a leaner and more accountable organisation. We are taking decisive actions in Indonesia, where long-standing challenges required a reset of the business, and China, where we are transforming our go-to-market approach during a market slowdown. We expect to see the benefits of these actions from the second half of 2025.

“The separation of Ice Cream remains on track and we are making good progress on the key workstreams. We announce today the appointment of the Chair Designate for the demerged Ice Cream business and details of the listing structure.

“Market growth, which slowed throughout 2024, is expected to remain soft in the first half of 2025. The steps we have taken in 2024, including the launch of our refreshed GAP2030 strategy, further reinvestment in our brands and strong innovation pipelines leave us better positioned to deliver on our ambitions in the years ahead.”

Outlook

We expect underlying sales growth (USG) for full year 2025 to be within our multi-year range of 3% to 5%. Market growth slowed throughout 2024. We anticipate a slower start to 2025 with subdued market growth in the near term. We expect the market and our growth to improve during the year as price increases, reflecting higher commodity costs in 2025. We expect a more balanced split between volume and price.

We anticipate a modest improvement in underlying operating margin for the full year versus 18.4% in 2024. We expect this improvement to be realised in the second half given the very strong first half comparator of 19.6%, which benefitted strongly from the combination of carry-over pricing and input cost deflation.

Full year review: Unilever Group

Performance

Underlying sales growth for the full year was 4.2%, led by volume of 2.9% and price of 1.3%. We delivered four consecutive quarters of underlying volume growth above 2%, with all Business Groups driving positive volume growth for the year. As expected, underlying price growth moderated to 1.3%. Turnover was €60.8 billion, up 1.9% versus the prior year, with underlying sales growth of 4.2% more than offsetting the -0.7% impact from currency and -1.5% from disposals net of acquisitions.

The Power Brands contributed >75% of turnover and performed strongly with 5.3% underlying sales growth, driven by volume growth of 3.8%. The rest of the business also delivered improved volumes with volume growth of 0.7% in the second half, up from -1.6% in the first half of 2024.

As guided with our first half 2024 results, our turnover-weighted market share movement^[a], which measures our competitive performance on a rolling 12 month-basis, sequentially improved in the second half reflecting the increasing benefits from the Growth Action Plan.

Beauty & Wellbeing grew underlying sales by 6.5%, with volume growth of 5.1% driven by strong growth across its Power Brands. Personal Care grew 5.2% with 3.1% volume growth, led by strong, innovation-led sales growth of Deodorants. Home Care underlying sales increased 2.9%, with 4.0% volume growth more than offsetting the price decline linked to commodity cost deflation.

Foods grew underlying sales 2.6%, with muted volume growth of 0.2% amidst a market slowdown and moderating prices. Ice Cream grew 3.7%, with a return to positive volume growth of 1.6%. This reflected an improved performance in the second half supported by bigger innovations and operational improvements.

Developed markets (42% of Group turnover) grew underlying sales 4.4%. Underlying volume growth of 3.3% reflected a strong performance in North America, led by Beauty & Wellbeing, and a big improvement in Europe, driven by Home Care and Personal Care. As expected, price growth moderated to 1.1%.

Emerging markets (58% of Group turnover) grew underlying sales 4.1%, with 2.5% from volume and 1.5% from price. India grew 1.8% with 2.4% underlying volume growth. Tonnage volume grew mid-single digit, which was partially offset by adverse mix due to the strong growth in Home Care. The business continued to increase market share during a period of modest market growth.

Underlying price returned to positive in the fourth quarter on the back of rising input cost inflation. Latin America grew 6.0% with positive volume growth across Brazil, Mexico and Argentina. Growth slowed in the second half, reflecting a deterioration of economic conditions in the region. Africa and Turkey delivered double-digit growth with positive volumes and price in each quarter.

China declined mid-single digit with market weakness across all categories apart from Foods. In the context of softer markets, we are accelerating our portfolio premiumisation and transforming our go-to-market approach to effectively serve fast-growing e-commerce channels and smaller format stores in lower tier cities.

In South East Asia, volume-led growth in the Philippines and Thailand was offset by an 8.7% decline in Indonesia. In the second half, we took decisive actions by correcting misaligned pricing across channels and resetting stock levels in retail, while also addressing our long-standing issues of portfolio, brand, and competitiveness. This will take several quarters. As we have said previously, we expect to see the benefits of the changes in Indonesia and China from the second half of 2025.

Profitability

Underlying operating profit was €11.2 billion, up 12.6% versus the prior year. Underlying operating margin increased 170bps to 18.4%. This step-up in profitability contributed to a 190bps increase in underlying ROIC to 18.1%.

We expanded gross margin by 280bps to 45.0%, the highest it has been in a decade. Continuing to improve gross margin remains a key focus for the business. Our gross margin improvement in 2024 reflects positive contributions from volume leverage, mix and net productivity gains in material, production and logistics costs. It was also helped by input cost deflation in the first half, which turned into slight inflation in the second half.

Improved gross margin fuelled further increases in brand and marketing investment behind a strong and focused innovation programme. Investment was up 120bps to 15.5% of turnover, an increase of €0.9 billion. Overheads reduced by 10bps, as a result of tighter cost control and savings in the second half from the productivity programme.

Operating profit of €9.4 billion decreased 3.7% versus the prior year. This reduction was driven by higher non-underlying charges, most notably a loss on disposals and higher restructuring costs as a result of accelerating the productivity programme.

Productivity programme

In March 2024, we announced the launch of a major productivity programme to simplify the business and further evolve our category-focused model. The programme is targeted to deliver €800 million of savings, with a reduction of 7,500 mainly office-based roles, creating a leaner and more accountable organisation. Including this programme, we expect average restructuring costs to be around 1.2% of Group turnover over the three-year period from 2024 to 2026.

Following thorough consultation processes, the programme is ahead of plan with a reduction of 4,300 FTEs by the end of 2024 and in-year savings close to €200 million. Restructuring costs, including the accelerated productivity programme, increased to €850 million, equivalent to 1.4% of Group turnover in 2024. We anticipate a similar restructuring cost of approximately 1.4% of Group turnover in 2025 with a lower spend in 2026.

The new organisation structure went live on 1 January 2025. This enables the Business Groups to focus on the top 24 markets, which represent approximately 85% of Group turnover, and the 30 Power Brands. The remaining smaller markets are now run on a 'One Unilever' basis to benefit from scale and simplicity, further enhancing our portfolio prioritisation and focus.

Ice Cream separation

The separation of Ice Cream is on track to complete by the end of 2025. We are making progress on the key workstreams, including the legal entities set up, implementing the standalone operating model and preparing the carve-out financials.

Jean-Francois van Boxmeer has been appointed as Chair Designate for the separated Ice Cream business. Jean-Francois brings a wealth of experience both as a non-executive and as an executive operating within the consumer goods industry. Jean-Francois is currently Chair of Vodafone Group Plc and non-executive director of Heineken Holding N.V. having been Chief Executive of Heineken for 15 years.

Ice Cream will be separated by way of demerger, through listing of the business in Amsterdam, London and New York, the same three exchanges on which Unilever PLC shares are currently traded. The Ice Cream business will be incorporated in the Netherlands and will continue to be headquartered in Amsterdam. This decision follows a full review by the Board of separation options, focused on maximising returns for shareholders, setting the Ice Cream business up for success and execution certainty by the end of 2025.

Capital allocation

We continued to reshape our portfolio, allocating capital to premium segments through bolt-on acquisitions and divesting lower-growth businesses. In February 2024, we acquired K18, a premium biotech hair care brand. We completed several disposals during the year. These included Elida Beauty, our stake in Qinyuan Group (known as “Truliva”), a water purification business in China, and Pureit, a water purification business in Asia and Mexico.

In October, we completed the sale of our Russian subsidiary to Arnest Group. The sale included all of Unilever’s business in Russia and its four factories, as well as our business in Belarus. In addition, we announced several disposals that we expect to complete during 2025, including the sale of the Foods brands Unox, Conimex and Zwan, as well as the disposal of our laundry business in Central America.

In January 2025, Hindustan Unilever Limited announced it has signed an agreement to acquire the premium actives-led beauty brand Minimalist, as we continue to evolve our Beauty & Wellbeing portfolio towards higher growth and demand spaces in India.

In 2024, we returned €5.8 billion to shareholders through dividends and share buybacks. The quarterly interim dividend for the fourth quarter is raised to €0.4528, up 6.1% vs Q4 2023.

Following the completion of a €1.5 billion share buyback programme in November, we announce a new share buyback of up to €1.5 billion starting today and to be completed in the first half, well ahead of the separation of Ice Cream.

Business Groups

Beauty & Wellbeing (22% of Group turnover)

In Beauty & Wellbeing, we focus on three key priorities: premiumising our core Hair and Skin Care portfolio by emphasising brand superiority; fuelling the growth of our Prestige Beauty and Wellbeing portfolios with selective international expansion; and, continuing to strengthen our competitiveness through innovation and a social-first approach to consumer engagement.

Beauty & Wellbeing delivered a strong full year performance, with underlying sales up 6.5%, driven by volume at 5.1% and price at 1.3%. Volume growth was broad-based with strong performances from its Power Brands including Sunsilk, Dove, Vaseline, Pond’s, Liquid I.V. and Nutrafol. In Q4, Beauty & Wellbeing grew 5.2% with 3.9% volume.

The full year performance reflects the ongoing premiumisation of our core Hair Care and Skin Care portfolio and the continued strength of our Prestige Beauty and Wellbeing portfolio, which combined accounted for c. 30% of Beauty & Wellbeing’s turnover.

Hair Care grew mid-single digit with balanced volume and price growth. Our largest hair care brand, Sunsilk, grew high-single digit reflecting the continued success of its 2023 relaunch and introduction of new formats. Dove delivered high-single digit volume-led growth following the launch of Scalp + Hair Therapy, designed for improved scalp health and hair density. TRESemmé grew mid-single digit following the launch of the Lamellar Shine collection. Clear grew low-single digit amidst low market growth in its primary market China.

Core Skin Care grew mid-single digit led by low-single digit volume and positive price. Vaseline grew double-digit with the expansion of its premium Gluta-Hya range to new markets and new formats. Gluta-Hya is now in over 22 markets and has introduced a new serum based suncare range. Dove skin care delivered double-digit growth, with the launch of its body serums and 3-in-1 face care treatments in Brazil, Mexico, and most recently in the US. Pond’s grew double-digit led by volume following its successful relaunch in 2023.

Wellbeing grew strong double-digit led by Liquid I.V., Nutrafol, and Olly. Liquid I.V. saw continued success of its sugar-free variant and ongoing international expansion, entering seven new markets during the year. Nutrafol extended into skin care with a daily supplement designed to address acne, while Olly saw strong growth in China led by its female health supplements. Prestige Beauty grew mid-single digit reflecting a slowdown in the US beauty market. Hourglass and Tatcha grew double-digit while other brands including Paula’s Choice delivered low growth. During the year, we completed the acquisition of K18, a premium biotech hair care brand, which grew double-digit and will be included in underlying sales growth from February 2025.

Underlying operating margin improved 70bps with strong gross margin improvement partially reinvested in increased brand and marketing investment.

Personal Care (22% of Group 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 grew underlying sales 5.2% for the year with volume growth of 3.1%. This growth was led by continued strength in Deodorants. In the fourth quarter, Personal Care grew 5.3% with Deodorants, Skin Cleansing, and Oral Care all delivering volume growth.

Personal Care’s full year performance was led by its Power Brands and science-backed innovations. These innovations were supported by a step-up in marketing investment, including our five-year sponsorship deal with the Fédération Internationale de Football Association (FIFA), and our sponsorship of several major football tournaments worldwide, including UEFA EURO 2024 and the CONMEBOL Copa America USA 2024.

Dove, which represents c. 40% of Personal Care’s turnover, grew high-single digit with the successful launches of a new range of whole-body deodorants and a serum shower collection, using active face care ingredients in body wash formats.

Deodorants grew double-digit led by mid-single digit volume growth. This included Rexona and Axe which grew high-single digit, driven by ongoing success from multi-year innovations, including our body heat-activated technology and our Fine Fragrance collection.

Skin Cleansing grew low-single digit with positive volume and price. Good growth in Dove was partially offset by declines in Lifebuoy and Lux, driven by challenges in Indonesia, China, and India.

Oral Care grew mid-single digit led by price. Our Power Brands, Closeup and Pepsodent, grew mid-single digit with positive price and volume. Pepsodent launched its therapeutics range specifically formulated for sensitive teeth.

Underlying operating margin increased by 190bps, driven by a very strong gross margin improvement fuelling increased brand and marketing investment.

Home Care (20% 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.

Home Care grew underlying sales 2.9%, with 4.0% from volume and -1.1% from price. Home Care faced the highest commodity cost deflation across Unilever which impacted laundry powders in several emerging markets.

In Home Care, we stepped up multi-year, scalable innovations with several key launches as well as extending successful 2023 launches. These Power Brand focused innovations drove a return to strong growth in Europe and were supported by increased investments in brand and marketing and R&D to drive unmissable brand superiority.

Fabric Cleaning was flat with low-single digit volume growth fully offset by negative price. Volume growth was supported by the launch of Persil Wonder Wash, the first liquid detergent designed for short cycle washes. Wonder Wash, powered by our patented Pro-S technology, has been launched in eight markets and is on track to be in 20 markets by the end of 2025. Europe grew double-digit with strong volumes. Brazil experienced the most significant price declines among our key markets reflecting commodity deflation, notably in our powders portfolio.

Home & Hygiene grew high-single digit with strong volume and positive price. Both Domestos and Cif grew double-digit led by volume, with contributions from the Power Foam, cream and sprays portfolio.

Fabric Enhancers grew high-single digit driven by strong volumes, slightly offset by negative price. The successful launch of our new Botanicals and Elixir ranges, utilising our patented CrystalFresh technology drove a good Comfort performance.

Underlying operating margin increased by 220bps, driven by strong gross margin improvement which was slightly offset by a step-up in brand and marketing investment.

Foods (22% of Group turnover)

In Foods (formerly known as 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.

Foods grew underlying sales 2.6% for the year, with 2.4% from price and 0.2% from volume. Our two largest brands, Hellmann’s and Knorr, which accounted for c. 60% of the Business Group, continued to grow ahead of the Foods average. In the fourth quarter, Foods grew 2.6% while market growth remained muted.

In Foods we are creating a more focused and simplified business concentrated on Cooking Aids, Condiments, Mini Meals, Unilever Food Solutions, and our India local Foods portfolio. These categories are where we will lead and where we can best concentrate our investment behind our global Power Brands, Knorr and Hellmann’s.

Cooking Aids grew mid-single digit with positive price and volume. Knorr performed well with mid-single digit growth driven by its leadership in bouillon and seasonings and its expansion of premium ready-to-eat pots ranges. Knorr grew double-digit in Latin America through its focus on local dishes and next generation bouillon and seasoning ranges with enhanced flavours and micronutrients.

Condiments grew low-single digit with balanced volume and price growth. Hellmann’s grew low-single digit led by volume growth as it continued to expand its Flavoured Mayo range, now in 30 countries, and grow its premium format variants, including new squeeze bottles.

Unilever Food Solutions grew high-single digit led by volume with positive price. This growth was supported by the rollout of our operator solutions including the latest edition of our Future Menu’s Trend Report, now utilised in over 50 countries, and expansion of our digital selling programme, which improved product availability and reach. Growth also benefited from the launch of Hellmann’s Professional Mayo in Europe and Brazil, tailored for professional kitchens. China grew high-single digit following a strong Chinese New Year in the first half of the year.

India Foods was flat, as tea and functional drinks maintained market leadership in subdued markets.

Underlying operating margin increased significantly, up 270bps, driven by strong gross margin improvement which funded an increase in brand and marketing investment.

Ice Cream (14% of Group turnover)

In Ice Cream, we are focused on continuing to strengthen the business in preparation for Ice Cream’s separation by the end of 2025. We are doing this by developing an exciting product pipeline, designing more efficient go-to-market strategies, optimising our supply chain, and building a dedicated sales team globally. 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 grew underlying sales 3.7%, with 1.6% from volume and 2.1% from price, marking a return to positive volume growth. In the fourth quarter, Ice Cream grew by 4.3%, driven by 2.2% volume growth and 2.0% price growth.

The improving performance in 2024 was fuelled by strong innovations and operational improvements. These ongoing improvements included a more efficient go-to-market strategy, improved distribution, and optimised promotional activities. Share performance improved throughout the year and we sharpened our focus on net productivity, which supported gross margin expansion and reinvestment in our brands.

In-home Ice Cream (c. 60% of Ice Cream turnover) grew low-single digit led by volume growth. This was supported by several snacking innovations with smaller portions. Magnum launched premium, bite-sized Bon Bons, designed to meet evolving snacking habits. The range is performing well and is now in 12 markets with further rollout planned for next year. Joining the small indulgence format, Yasso introduced Poppables, a Greek yogurt-based snack, while Ben & Jerry’s expanded its Peaces range with new flavours like Salted Caramel Brownie.

Out-of-home Ice Cream (c. 40% of Ice Cream turnover) grew mid-single digit fully led by price. We launched several premium innovations this year including Magnum’s Pleasure Express featuring flavour filled cores and Ben & Jerry’s new oat base for its non-dairy ice creams. Cornetto celebrated its 60^th anniversary with its first global relaunch featuring enhanced formulation and new packaging.

Underlying operating margin increased by 100bps, driven by improved gross margins which supported an increase in brand and marketing investment. This margin improvement was realised despite higher commodity costs in cocoa and dairy. We expect rising inflation in cocoa and dairy costs to put pressure on margins in 2025.

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