Unilever Plc Q3 FY2023 earnings call

Graeme provided Q3 trading performance details, noting underlying sales growth of 5.2% driven by price. Hein outlined an action plan to lift performance, focusing on competitiveness, with a focus on top 30 power brands, unmissable brand superiority, scaling multiyear innovations, increasing brand investment, and selective portfolio optimization. Emphasis on sustainability with a focus on four key pillars: climate, nature, plastics, and livelihoods. Also, driving benefits from the new organizational structure and dialing up performance edge through leadership changes and performance culture shifts.

Beauty and Well-being: Reported 7.4% growth in Q3, balanced between 3.6% volume and 3.6% price, third quarter of volume growth, driven by Prestige beauty and Health & Well-being brands. Personal Care: Reported 8% growth in Q3, balanced with 3.9% volume and 4% price, third quarter of volume growth, deodorants with double-digit growth. Home Care: Grew 5.3% in Q3, with return to volume growth of 0.4% and price up 4.8%. Nutrition: Grew 5.6% in Q3, price at 9.8%, volumes down 3.8% due to high input costs and portfolio issues. Ice Cream: Had negative 2.8% growth in Q3, price up 8.2%, volumes down 10.1% due to pricing and portfolio reshaping.

Overall remains on track to deliver full year guidance, outlook unchanged. Expect underlying sales growth above 5%, price growth continuing to moderate, confident in achieving full-year targets.

Volatile landscape, competition premiumizing faster, economic challenges in regions like China and Argentina, impact of currency fluctuations, and potential consumer down trading due to economic pressures.

Q: Back in December when the team laid out the multiyear framework of 5% organic growth, is the increased focus still the right way to think about where you'd like to end up within that 3% to 5% range?

A: Hein confirmed that the 3% to 5% growth ambition is the medium-term goal and remains relevant.

Q: On Q3 nutrition and volume decline, is it a question of taking too much pricing in Europe?

A: Hein stated pricing may have played a role but not the main hindrance, and they aim to improve through innovation and execution.

Q: On market share, how much is real share loss and how to measure competitiveness?

A: Hein discussed multiple metrics for competitiveness, including business winning, market share, and market-weighted metrics, and plans to provide a more comprehensive picture.

Q: On innovation, what's different about the new approach?

A: Hein emphasized focusing on bigger, bolder innovations with technology platforms and prioritizing top 30 brands.

Q: On financial ambitions and EPS growth, how is it considered?

A: Graeme explained considering both constant and current currency growth, with plans to align remuneration with shareholder interests.

Q: On why performance has been weak, and board/governance role?

A: Hein discussed discipline, clear priorities, and performance culture as key factors, emphasizing incoming CEO's role in improving the situation.

Q: On European footprint and innovation agenda?

A: Hein highlighted optimization opportunities in Europe and focus on top 30 brands for innovation, with R&D aligned to drive scale.

Q: On growth rate composition and 2024 outlook?

A: Graeme discussed cost inflation outlook, normalizing inflation, and reinvestment for quality growth.

Q: On market share gains and competitor characteristics?

A: Hein stressed market development through innovation and premiumization to naturally gain share within categories.