Good. Thank you, Orin, and thank you, Barley, for having me here today. And good morning, everyone. It's a real pleasure to be with you. I have been the CEO of Unilever since March this year. Before that, the CFO of the company, before that, president of Edang and many other executive roles in the company. I will try in the next 25 minutes or so to really give you five fundamental chapters of presentation. One is for the American investors that have not followed Unilever so closely, give you a brief snapshot of what Unilever is today. Then assure you that the fundamental organizational and portfolio changes we have embarked on in the last two years are largely complete and are fundamentally behind us. Then be clear about what are my belief systems in order to accelerate performance and what are the clear priorities in terms of geographies, channels, categories and segments in which Unilever will play. I will try to show you also how we are really making Unilever a marketing and sales machine, how we are driving desire at scale as a fundamental mantra to elevate our brands, and how we are really executing with rigor in every single geography. And finally give you fundamentally a glimpse into what you can expect from Unilever in 2025 and beyond.
We made a significant organizational change in 2022 after more than 100 years running the company on a geographical basis. We moved into a category-led organization at the global level. We set up the company in five business groups. Our revenue 61 billion at 2024 numbers. Beauty and wellbeing, personal care, home care and foods — all very sizable businesses between 12 and 14 billion. And a fifth business group in ice cream of 8.3 billion that as you know we are separating by November this year. These five business groups are led by a business group president. They have full P&L accountability, end-to-end accountability. They own 93% of the lines of investment and cost in their P&L. We run these business groups with two to three verticals in each of them. We operate 13 verticals in the company nowadays. And this is the company that we have today.
We have strong financials. In 2024, we delivered 11 billion profit, 18.4% underlying operating margin. We delivered 7 billion cash. Our cash conversion has been very consistent in the last five years or so around 100%. Of these 7 billion cash we returned to shareholders 5.8 billion — 4.3 in dividends, 1.5 in share buybacks — and we have one of the best returns on invested capital in the sector at 18.1%. So strong financials and a strong competitive position. We have 80% of our revenue in leading positions in the geographies and categories where we operate. But I know also that Unilever has been an inconsistent performer. We know what are the gaps we have had particularly since the Kraft-Heinz bid in 2017. Time flies and things change a lot, but that really derailed Unilever a lot. We lost our focus on volume growth. We set up a margin guidance that really put the company very tight. But there were many other issues in the company that we are addressing fast. A very complex organization from 2005 to 2021, we ran a very heavy matrix organization, very complex, with the profit in the countries but a very bloated organization in the center running category strategy, brands, innovation.
We have been inconsistent in defining volume growth as our fundamental metric. I believe very strongly that what gives relevance to a company is to grow volume every single year. We have been very inconsistent in our investment behind our brands. We have used the A&P line as an adjustment to ensure earnings growth. And we have had a very inconsistent performance culture — some pockets of excellence, you know, I grew up in one of them, our Argentinian company, our Latin American business, India, many other companies in Unilever, but also many pockets of mediocrity in the company. So we recognize that, we know that this has to change and we have made significant interventions in the company to really change this.
What we have changed: we announced the separation of ice cream on March last year. It will be completed by November this year. Ice cream is a very good business. We have five of the 10 biggest global brands, but it's a business with very different features to the rest of Unilever — high capital intensity, seasonality, completely different channel structure, etc. So we are now focused on our portfolio in four business groups that are very complementary in terms of the R&D capabilities, technology, manufacturing, logistics, channels in which we operate. So it's a more focused portfolio. The separation of ice cream has a significant impact in some of our financials. Our gross margin will go close to 47%. We have an expansion in our return on capital invested of around 100 basis points. So the business that remains is very, very attractive.
We have also decided to focus our portfolio in 30 power brands. I tend to say that one of the fundamental strategic issues of Unilever is that it's not truly a global company. It's a federation of local and regional brands. And we are changing that. We used to operate with 400 brands. By the end of 2024, we have 200. But 30 power brands concentrate 75% of our revenue. They are accretive in volume growth. We delivered 3.8% volume growth last year in these 30 power brands and we have chosen these brands because they are the brands in which we believe we can scale them regionally and globally. We can allocate our best technology because there is a space for premiumization in all of them and this is where we are putting all our focus for growth.
We have also made some significant interventions in how we organize ourselves at the country level. The top 24 markets of Unilever are now run by the business groups, by each of the pillars, because these are businesses with enough critical mass to separate our organization and because we believe that in these biggest markets, to compete with pure-play competitors like the ones we compete in beauty, foods, home care or personal care, we need a significant level of specialization. We need specific capabilities and skills in order to compete with these guys. In market 25 onwards, in the other 165 markets in which we operate, we will continue operating the company at the One Unilever level. And that's fundamentally to ensure that we really get the benefit of scale, efficiency, and productivity. But with a very significant difference — in these 165 markets, in 65 markets we will support only eight brands, and these are eight of our 30 power brands. Five in beauty and personal care, two in home care, one in foods. Not a single penny will go for a specific local brand in these smaller markets. My ambition is to make these One Unilever markets, at least the contribution of power brands 90% in a relatively short period of time.
We have also made significant interventions in our organization, in terms of accountability. In 18 months we have reduced in reality 18% our white-collar workforce. With the latest number, we had announced that we were going to deliver 800 million savings by the end of 2026. By the end of this year we are already at 650 million cumulative savings. And importantly, we have absolute accountability now in the company. Four business group presidents, 44 P&L units. I have their names. I have their phones. Nobody can hide.
Results are starting to show. In 2024, we delivered our highest volume growth in a decade. We delivered our highest gross margin in a decade. And we invested the highest percentage in a decade. So 2.9% volume growth, 45% gross margin, more than 15% investment in brand and marketing investment, and an increase in the last four to five years of 33% in our marketing budgets. And it shows — we were top three in our peer group when it comes to volume growth both in 2024 and in the first half of this year. And as you know, I speak volume, I don't speak any other number. Pricing is fundamentally to compensate, but we are very, very happy with the development that we have had in volume in a context of very difficult market conditions.
Let me now go into how we will — and particularly what am I doing personally — in instilling a play-to-win culture, an ultra-competitive winning culture in Unilever, and what are we doing to really ensure that the portfolio we operate has more winners than losers. First of all, it's about the speed in decision-making and decisiveness in decision-making. We have taken big decisions and we are taking decisions with 70% certainty fast, because with 90-100% certainty you are late. Late in consumer goods is a very bad word. We are building a new marketing philosophy built around two fundamental concepts: desire at scale to elevate the aspirationality of our brands, and market making, because the only way in FMCG to ensure consistent share gain is to create markets, to create formats, to create segments and get a disproportionate share of the new segments that emerge. We are ensuring ruthless execution everywhere, in every market. We have codified what are the metrics we will measure. All our operators, these 44 guys in the markets, know what they have to deliver. We are fed up with the mediocrity that we have in some places. We are attacking that fast. We are ensuring accountability, and we have a new breed of leadership.
The board of Unilever is different, the leadership executive team of Unilever, and the first year — people coming from emerging markets. There is a clear blend of cultures in the new leadership team and there is a significant influence of non-Unilever born-and-bred people into the leadership of the company. In terms of talent, we are now assessing our top 200 leaders one by one, ensuring the benchmark with the market. Are they good enough? Are they at the level Unilever deserves? Yes or not? We expect 25% refreshing from that. We are fast-tracking emerging stars. We are bringing new people from the market. We have changed significantly the incentive system. We have increased the range of incentive for performance from zero to 200%, but also very important, our long-term incentive plan now is fundamentally high-currency incentive system. That's very different to what Unilever used to have in the past.
I have seven clear priorities: more beauty, more wellbeing, more personal care, more premium, more e-commerce, more US, more India. And our money is going following these priorities. You can like it, you cannot like it. But we are very clear about what we want to do. These are the priorities we have in terms of our categories, our segments, our channels and our geographies. There is a fundamental transformation in the Unilever portfolio. Beauty and personal care now are 51% of our revenue and our ambition is to make it two-thirds of our revenue in the midterm. You can see there the significant reduction of exposure to foods and refreshment that the company has achieved in the last 10 years.
We are increasing our exposure to premium. We have a portfolio with probably an excess of exposure to mainstream and value positioning. It's very clear what we are doing. We are acquiring premium. We're divesting value. And this is changing the portfolio of Unilever and we are fundamentally innovating in the premium segment to progressively increase our exposure to premium because the profit pool of our categories is shifting up in every single one of them. We are making US and India our centers of gravity going forward. After the separation of ice cream, US and India will be 32% of our revenue. In reality 35% of the acquisitions that we have done — 21% in US, 14% in India. And US is very, very important for us. Historically our US business has been a receiver of innovation for Unilever. Now it's US for us and US for the globe. That's a fundamental change in our strategy.
You can see the evolution of our portfolio in the US — 76% of our revenue now in beauty, wellbeing and personal care through a combination of significant bolt-on acquisitions, significant disposals particularly in the value segment, and significant organic growth of our premium brands in the market. And results speak for themselves. We now have four consecutive quarters of volume growth above 4% in the US. We believe we are building the company with the fastest growth footprint in the US in the sector. We are the number seven company in terms of size but I'm absolutely convinced we are building a structural fast-growing volume business in the US and customers are starting to see that.
What you see on the right of the chart is a result of what's called the Advantage Survey. This is 130 retailers scoring hundreds of companies in the US. We were number eight in the last few years, we jumped to number two this year — number one in personal care, number three in beauty, number one in foods. So it's a very, very significant way in how the customers are seeing us. They measure us in vision, partnership, execution — and these are the results that we are seeing. This is a fundamental change in Unilever.
India is the other anchor of our business. We have incredible positions in India and we believe that India will be for Unilever what China has been for some of our competitors in the last decade. This is the only large exponential volume growth opportunity in the globe. And we have incredible positions — more than 50% share in hair care, in skincare, in functional food, in dishwash, 45% share in laundry, 37% share in skin cleansing. In all these categories we are two to four times our closest competitor. We have been growing at 4%. But our ambition is higher than that. The GDP real growth in India should be a good proxy of our volume growth in the future. That's our ambition. We have made decisive changes in terms of leadership there. The leader of the business now has been my chief marketing officer. We are very, very confident that with the changes also in the economy of India — I believe that there are some significant stimulus going there — this should be one key growth driver for Unilever in the future.
We know also that the portfolio that brought us to this position in India is not the portfolio that will propel us into the future. And that's the reason that we are acquiring new businesses in India — businesses that are in super-growth stage. These are two recent acquisitions in India: Minimalist in skincare and O in BMS. These two businesses together will be around 100 million euros by the end of this year and growing. I will not tell you double-digit — it's just much more than that. We know also that we need to digitize dramatically our distribution system. We reach 9 million stores in India, 3 million stores directly. We are digitizing. We have the best digital platform for traditional trade coverage in India and we believe this is a very significant competitive advantage for us.
Let me now move into how we are transforming Unilever into a real marketing and sales machine. And there are two fundamental concepts, two fundamental mantras that we are establishing in the company. One is what we call desire at scale. The second is what we call perfect stores, offline and online. Desire at scale is anchored in what we call the development of SASSY brands. And SASSY of course means bold, disruptive, but in this case it's an acronym for five features that we believe are fundamental to guide our product development strategy and our models of reach and engagement. S of science for superior functionality. A of premium aesthetics. S of sensorial experiences. S of 'said by others' — very, very important. We really believe that the brands of the future are the ones that will be recommended by peers. And Y for young-spirited brands that remain contemporary. And this is what's guiding both innovation and the models of reach and persuasion. I will show you a video, one minute only, that encapsulates this idea.
We have a repeatable model. We call it the four Bs: variety of creators, vitality of content, velocity of posting, and validity of content. And we are applying this in every single brand everywhere. And Dove and Vaseline are excellent examples of that. Dove is our biggest brand. It's a 7 billion revenue brand. It has been growing last year 8% in volume. This year close to 5% in volume. And probably the most impressive one is Vaseline. Vaseline is a 155-year-old brand. It was sleeping for many, many years. In the last three years, we have added 400 million into this brand. 10% volume growth in 2024, 11% volume growth this year. In a very, very significant historical legacy brand, we could have not done this without the capabilities and skills that we acquired in prestige beauty and in wellbeing. So the acquisitions that we have done — Liquid I.V., Nutrafol, Paula's Choice, Tatcha, Hourglass — brought a set of capabilities that are very unique and we are deploying in our core business and our core business is starting to respond. Of course we have issues. Of course we have many brands in which we need to fix issues. But these are clear examples of where we want to take the vast majority of our portfolio.
Let me go into execution and fundamentally how to deliver — a strategy only exists in the markets. Everything starts with a very clear and granular model to really assess how our brands perform in every geography against competition. We have developed a proprietary model based on public information and proprietary data of Unilever. We call it our 'superiority framework' — 23 metrics around the six Ps that we measure with absolute clarity, understanding what is the weightage of each of these metrics in any particular geography, brand, channel, metric. And this is what guides how we operate in every market. And of course this has significant implications when it comes to promotion, place, pricing and execution in the markets. We have now defined nine very clear metrics for offline execution, 11 metrics for online execution — from price point, relative pricing, share of shelf, share of promotion, location in primary shelf, adjacency in secondary shelf, call to action of every brand in each store or online, ratings and reviews, the quality of the content. If I can remember this by memory, imagine my people on the ground. This is what guides every single conversation I have when my people go — when I go — to every single market in Unilever.
We also are building three fundamental hubs for what we believe is the strong expansion that we will have in e-commerce. We already have 20% of our business in e-commerce. When you go to China it's already 30%. But we are making the US the hub for Amazon development. We are making China the hub for TikTok Shop development. And we are making India the hub for quick commerce development. We are learning in these markets and rolling out quickly. I'm a great admirer also of what some beverages companies have done in terms of events and activations and in a context of media fragmentation this is more important than ever and we are doing it. We are doing it with Liquid I.V. at Lollapalooza. We are doing it with the World Cup next year for beauty and personal care. We are doing it with home care — or we are doing it with Hellmann's. Mayonesa is booming in Brazil, for example. So events and activation are a very important part of our strategy. And also we really believe that in-store theater, in-store visibility in physical and online stores is more important than ever in a context of media fragmentation. How we execute in a store is more important than ever. You have here images of Hellmann's in Brazil, Persil Wonder Wash in UK, K18 in Sephora, and every brand doing exactly the same. We are expanding and investing in visibility big time. We believe this is a key capability and a skill that we have to continue developing in the company.
So what can you expect from Unilever? And I'm finishing in a couple of minutes. We will deliver what we promised for this year. We will deliver between 3 and 5% in our A&P. We expect to deliver an underlying operating margin of at least 18.9%. We delivered 19.3% in the first half of the year. And we expect for the remaining company an acceleration of our volume performance in the second half of the year, with quarter four even higher than quarter three. We will treat ice cream as a discontinued operation from quarter four onward and we expect to close the separation of ice cream sometime in November.
We have absolute clarity about the model that we need to be — to be top-30 TSR in the sector. We need to deliver consistently 2-plus percent volume growth. We need to deliver a modest margin improvement based on consistent gross margin expansion. We consider gross margin expansion the fundamental financial backbone of our plan and we will be ruthless on that. We have four fundamental levers for that: volume growth, mix development, significant interventions in the procurement of some key materials in the value chain, and a ruthless discipline in our controlled cost management. If we do that we believe that we can deliver profit growth in our currency consistently at the level of the best companies in the sector.
With that let me summarize. You can expect that we will go for more beauty, more wellbeing, more personal care. We will disproportionately invest behind US and India. We will play to win and we will do it making desire at scale the core of our strategy. And we will build the culture in which playing to win is really recognized with very, very strong incentives for our leadership and ensure that Unilever is never again an insular company — it's a company that is open to the world, that is open for talent coming from outside. And with that we believe that we have a very optimistic future. Thank you very much.
