Unilever Full Year 2021 Results & Strategic Update - Alan Jope & Graeme Pitkethly
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Unilever Full Year 2021 Results & Strategic Update Alan Jope & Graeme Pitkethly 10th February 2022
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 ‘will’, ‘aim’, ‘expects’, ‘anticipates’, ‘intends’, ‘looks’, ‘believes’, ‘vision’, or the negative of these terms and other similar
expressions of future performance or Trading Statement, and their negatives, are intended to identify such forward-looking statements. These forward-looking
statements are based upon current expectations and assumptions regarding anticipated developments and other factors affecting the Unilever Group (the ‘Group’).
They are not historical facts, nor are they guarantees of future performance.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual Trading Statement to differ materially
from those expressed or implied by these forward-looking statements. Among other risks and uncertainties, the material or principal factors which could cause actual
Trading Statement 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 current Covid-19
pandemic.
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expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
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 Unilever Annual Report and Accounts 2020.
2
Alan Jope Full Year Results 2021 10th February 2022
Contents
2021 Overview Alan Jope
2021 Results Graeme Pitkethly
Strategic Priorities Alan Jope
2022 Outlook Graeme Pitkethly
4
2021 Delivery
Competitive
Q4 Growth FY Growth Pricing Growth Growth
Underlying Sales Growth Underlying Sales Growth
4.9%
4.1%
4.9% 4.5%
1.6%
53%
% Business Winning MAT1
0% 1.6%
1.0%
0.3%
Underlying Volume Growth Underlying Volume Growth FY'20 Q1'21 Q2'21 Q3'21 Q4'21
1Moving Annual Total / Last 52 weeks
5
2021 Delivery
Margin Earnings Cash
Underlying Operating Margin Underlying EPS Free Cash Flow
18.4% 5.5% €6.4bn
-10bps 7.8% -€1.3bn
vs 2020 Constant Underlying EPS vs 2020
6
Historical performance
USG % 3.2%
2-year CAGR
4.5%
3.6%
3.2% 2.9%
2.8%
1.9%
2016 2017 2018 2019 2020 2021
%Business Winning (MAT) UOM %
53% 53% 19.1%
51% 18.6% 18.5% 18.4%
44% 44% 17.7%
42%
16.4%
2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021
USG: 2016-2018 restated due to treatment of hyperinflation 7
UOM: 2017 & 2018 restated due to treatment of IFRS16
2021 Performance summary
Growth momentum building
Stepped up pricing in inflationary environment
Earnings growth
Competitiveness maintained
8
Graeme Pitkethly
Full Year Results 2021
10th February 2022
9
4.5% 1.6% 2.9%
Underlying Sales Growth FY USG FY UVG FY UPG
USG 3.5% 5.7% 5.0% 2.5% 4.9%
2 year 2.8% 2.3% 3.4% 4.2%
average
• Step up in 2-year average
growth through the year
UPG
• Continue to land pricing as
4.9%
inflation increases
UVG
Flat • Some volume elasticity as a
result
Q4'20 Q1'21 Q2'21 Q3'21 Q4'21
10FY 2021: Turnover growth
+3.4%
A&D 1.3%
(0.1)%
USG 4.5%
1.4%
(2.4)%
2.9%
€53.9bn
1.6%
€52.4bn
€50.7bn
FY 2020 UVG UPG Acquisitions Disposals FY 2021 Currency FY 2021
(Constant) (Current)
113.8% 0.8% 3.0%
Beauty & Personal Care FY USG FY UVG FY UPG
4% 4% 0%
Deodorant, Hair, Oral, Skin Care1 Q4 USG FY USG 2-yr CAGR
• Pricing stepping-up across all
categories
• Social occasions return but
remain below pre-Covid levels
3% (3)% 6%
Skin Cleansing Q4 USG FY USG 2-yr CAGR • Prestige Beauty growth
remains strong
• Skin Cleansing +13% vs 20192
1Excludes Prestige
2Average 2020 fx
12
rates5.6% 2.9% 2.7%
Foods & Refreshment FY USG FY UVG FY UPG
0% 2% 6%
In-Home Q4 USG FY USG 2-yr CAGR
• In-Home growth against high
base driven by strong core
brands and innovation
• Food Service recovery
accelerating throughout the
21% 23% (4)% year (-9% vs 2019) 1
Out of Home Q4 USG FY USG 2-yr CAGR
• Out of Home Ice Cream still
impacted by travel restrictions
(-9% vs 2019) 1
1Average 2020 fx
13
rates3.9% 0.7% 3.1%
Home Care FY USG FY UVG FY UPG
8% 6% 4%
Laundry Q4 USG FY USG 2-yr CAGR
• Significant pricing taken in H2
• Clean Future innovation
landing across markets
(5)% (4)% 6%
Home & Hygiene Q4 USG FY USG 2-yr CAGR • Home & Hygiene lapping
strong base (+13% vs 2019) 1
1Average 2020 fx
14
ratesRegional growth by quarter
Asia / AMET / RUB Latin America
€24bn TO €6bn TO
8.5%
11.9%
9.9% 8.7% 9.0%
U SG
7.2%
5.7% 5.7% 5.8% 5.8%
2.3% 13.9%
U PG 2.6% 2.7% 8.9%
4.3%
3.0%
U VG 1.3% 0.1%
- 4.8%
Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 FY'21 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 FY'21
North America Europe
€11bn TO €11bn TO
U SG 7.1%
6.5%
4.3% 4.0%
U PG 2.0% 3.4% 0.4%
1.1% 5.3% 0.8% 0.3%
2.9% 0.7% 0.2%
U VG 1.1% 0.5% 0.3%
- 1.5%
-2.3% -0.8%
Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 FY'21 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 FY'21
15FY 2021: Underlying operating margin
(10)bps
€7.0bn1 0.2%
(1.2)% 0.9%
Includes
C ovid costs & mix
+30bps unwind
18.5% 18.4%
FY 2020 Gross Margin Brand & Marketing Overheads FY 2021
Investment
1BMI FY spend at constant fx rates 16FY 2021: Underlying earnings per share
C urrent underlying EPS
+5.5%
C onstant underlying EPS
+7.8%
0.1%
0.5% 1.3%
(1.8)%
0.9% (2.3)%
7.7%
€ 2.69 €2.68
€ 2.67 € 2.66
€ 2.64 € 2.64
€ 2.61 € 2.62
€ 2.48 € 2.48
FY 2020 Turnover & Finance cost Tax Minorities SBB Other FY 2021 Currency FY 2021
operational (Constant) (Current)
performance
172021 vs multi-year financial framework
Growth Profit Cash
Underlying sales
Profit growth ahead Sustained strong cash
growth ahead of our
of USG flow
markets 3-5% USG
4.5% -10bps €6.4bn
UOM
Long term value creation
Growing dividend
though earnings growth
5.5% +3%
182021 vs other long term financial metrics
Savings
Restructuring
Savings Restructuring
Savings
Restructuring ROIC
Savings
Restructuring Leverage
Savings
Restructuring
investment investment investment investment
Ambition €2bn €2bn Mid to 2.0x
Per annum Over ‘21 and ‘22 high teens approx.
2021
€2bn €0.6bn 17.2% 2.2x
19Performance summary
Growth momentum building
Stepped up pricing in inflationary environment
Earnings growth
Competitiveness maintained
20Alan Jope Strategic Priorities 10th February 2022
Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
22Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
231. Winning with our brands
Product Bigger, better
13 €1bn brands
superiority innovations
6.4%
FY’21 USG
50% of TO 71% >€1bn
of turnover tested incremental turnover
winning vs competition through bigger,
vs better innovations
47% in 2019 (2021)
24Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
252. Accelerating in USA, India and China
€9.9bn €5.6bn €3.3bn
FY’21 TO FY’21 TO FY’21 TO
13.4% 14.3%
7.7% 11.2%
7.7% 6.1%
6.9% 7.9%
3.7%
USG% 4.2%
0.9% 2.0%
0% 0.2%
-1.7%
'17 '18 '19 '20 '21 '17 '18 '19 '20 '21 '17 '18 '19 '20 '21
>75% >55%
60% >65%
%BW 20%
(MAT)
'17 '18 '19 '20 '21 '17 '18 '19 '20 '21 '17 '18 '19 '20 '21
26Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
273. Channels - eCommerce
44% eCom
2021 eCom USG Turnover contribution
Omni USA 13%
+31% +13%
Pure play India
+24% +200% +
2%
eB2B China
+91% +25% '16 '17 '18 '19 '20 '21
28Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
294. A new, future-fit organisation
Simpler, faster, more category focused
Unilever Corporate Centre
Business
Groups
Beauty & Personal Home
Nutrition Ice Cream
Wellbeing Care Care
Unilever Business Operations
304. A new, future-fit organisation
Corporate Centre
Beauty & Home
Personal Care Nutrition Ice Cream
Wellbeing Care
Hair Care Skin Cleansing Fabric Cleaning Scratch Cooking Ice Cream
Skin Care Deodorant Fabric Enhancers Healthy Snacking
Prestige Oral Care Home & Hygiene Functional Nutrition
Vitamins Minerals & Dollar Shave Club Water & Air Plant-based Meat
Supplements Elida Beauty UFS
Geographic Geographic Geographic Geographic Geographic
Business Units Business Units Business Units Business Units Business Units
Business Operations
314. A new, future-fit organisation
Jan 22 July 22 • Designed to further improve
performance
• €0.6 bn savings
• 15% reduction in senior
Go Live
Reorganisation
announced management positions
• H1 reported on • 5% reduction in junior
current 3 Divisions management positions
• Q 3 onwards reported
on 5 Business Groups
32Five clear strategic priorities
1. 2. 3. 4. 5.
Accelerate Purpose -led, Move
Win with Lead in future-fit
USA, India, portfolio into
brands and channels of organisation
China and high growth
innovation the future & culture
EMs spaces
335. Portfolio change
Acquisitions Disposals Portfolio rotation
(‘17-’21 % of TO)
€16bn capital invested €11bn proceeds
in 29 acquisitions from 12 disposals
since 2017 since 2017 17%
13%
O ther
7% Functional O ther
Pre stige Nutrition 2%
17% 43% Te a 98%
33%
93%
Spreads
BPC 65%
33% UL Peers avg
345. Portfolio change
‘21 USG contribution High teens ROIC maintained
(bps contribution to ’21 USG from acquisitions throughout period of significant portfolio rotation
and disposals since ‘17)
4.5%
19% 19%
0.4% 18% 18% 17%
0.7%
3.4%
USG USG USG 2017 2018 2019 2020 2021
excl. acquisitions & acquisitions disposals
disposals (estimated)
355. Portfolio change
Strong M&A track record in key growth categories
(Performance and FY’21 TO of major recent acquisitions)
2016 2016 2017 2017 2017
Blueair DSC C arver Q uala Sundial
€230m €230m €310m €270m €300m
2015-21
Prestige Beauty 2020-21
€1bn Functional Nutrition
€1.5bn
2021
36% (4)% 2% 2% 28% 24% 22%
USG
365. Portfolio change
Functional
Prestige Beauty Bps contribution to
Nutrition1
USG Q4 18% | FY 24% Unilever USG%
USG Q4 27% | FY 22%
#2 #1 60
70
Skincare brand Kids multivitamin
in Sephora brand on Amazon
(Tatcha) (SmartyPants) 40 40
#1 #1 10
Professional
Hydration 0
skincare brand
globally brand globally
(Liquid IV) FY '19 FY '20 Q1'21 Q2'21 Q3'21 Q4'21
(Dermalogica)
1Health Food Drinks + Vitamins, Minerals & Supplements 37Key messages
• Focused on maximising performance from existing portfolio
• Exiting 2021 with momentum
• Responding to unprecedented inflation with strong pricing
• Organisational change will be an accelerant
• Disciplined capital allocation will continue
38Graeme Pitkethly 2022 Outlook 10th February 2022
Capital allocation
Operational investment
Portfolio reshape
€3bn
Returns to shareholders share buyback
over 2022/2023
40Unprecedented inflation, margin recovers
Margin to be restored after 2022, with the majority coming back in 2023
G M (bps) (150) 100 (30) (160) 30 110 10 80 50 60 50 30 (55) (120)
Includes
Covid costs & mix
UPG% 4.5 7.2% (90)bps headwind
4.4 4.8% 8.0%
7.0%
4.3
4.2 3.3% 2.9% 6.0%
4.1
4.0 1.6% 5.0%
4.0%
3.9
3.8 0.3% 3.6 3.0%
2.0%
3.7
3.6 1.0%
3.5
3.4 0.0%
(1.0)%
3.3
3.2 (2.0)%
3.1
3.0 (3.0)%
(4.0)%
2.9
2.8 (5.0)%
(6.0)%
2.7
2.6 2.4 (7.0)%
2.5
2.4 (8.0)%
(9.0)%
NMI 1 2.3
2.2 (10.0)%
(€bn) 2.1
2.0 (11.0)%
(12.0)%
1.9
1.8 (13.0)%
(14.0)%
1.7
1.6 1.4 1.3 (15.0)%
1.5
1.4 (16.0)%
(17.0)%
1.3
1.2 (18.0)%
1.1
1.0 (19.0)%
(20.0)%
0.9
0.8 0.6 (21.0)%
(22.0)%
0.7
0.6 (23.0)%
0.5
0.4 0.2 0.1 (24.0)%
(25.0)%
0.3
0.2 (26.0)%
0.1
0.0 (27.0)%
(28.0)%
(0.1)
(0.2) (29.0)%
(30.0)%
(0.3)
(0.4) (31.0)%
(0.5) (32.0)%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
1
Net Material Inflation = market inflation post impacts of hedging, procurement actions, product reformulations and currency movements 41Outlook
2022 Priorities 2022 Guidance
C ontinuing growth momentum 4.5-6.5% price led growth
Maintain competitive levels of spend in BMI, R&D and
Managing inflationary pressure while investing for growth
C apex
• FY UOM 16-17%, down by 140-240bps
Implementing new operating model • H1 more heavily impacted than H2
• Expect margin to be restored through 2023 and 2024
42Unilever Full Year 2021 Results & Strategic Update Alan Jope & Graeme Pitkethly 10th February 2022
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