Unilever
Q1 2026 Trading Statement
Q1 2026 Trading Statement
London, 8:00am, Thursday 30th April 2026
Fernando Fernandez
Chief Executive Officer
Srinivas Phatak
Chief Financial Officer
Jemma Spalton
Head of Investor Relations
FERNANDO FERNANDEZ:
Good morning and thank you for joining us for Unilever’s first quarter trading statement
for 2026.
I am joined today by Srini Phatak, our Chief Financial Officer.
In a moment, Srini will take you through the detail of the quarter.
I will also come back to say a few words on the recent announcement regarding our
Foods business, and why we believe this is the right move – for Foods, for Unilever, and
ultimately for our shareholders – that will unlock significant value.
But first, let me set out what I see as the key elements of our performance in the first
quarter.
We made a good start to the year.
Growth was solid, and – importantly – in line with the strategic priorities we have set for
the business.
1
Unilever
Q1 2026 Trading Statement
We delivered underlying sales growth of 3.8% driven by a strong volume growth of 2.9%
in the quarter.
Growth was broad-based across categories, with a particularly strong quarter in Home
Care – with volumes up 6.2% driven by a strong innovation plan and good volumes in
our two largest Home Care markets: India and Brazil.
Our Power Brands, which represent around 78% of turnover, continued to lead the way,
growing 5% in the quarter, with volumes up 4% - reflecting the benefits of our highquality innovation and focused investment behind these brands.
Emerging markets performed well with a further step-up in volume growth, to 4.2%. We
saw strong performances in markets such as India, Turkey and Vietnam. At the same
time, those markets where we have taken decisive actions to improve competitiveness
– Indonesia, China, Brazil – all continued to make good progress.
Developed markets remained resilient in a challenging environment.
North America, delivered volumes of 2.2%, led by Personal Care and Beauty, despite
strong comparators. Europe remains more subdued, reflecting the softer backdrop.
We also continued to make good progress against our strategic priorities –
strengthening Desire at Scale across our portfolio and improving the quality of our
execution; and I will come back to say more on this later.
But first, over to Srini to take you through the results in more detail…
SRINIVAS PHATAK:
Thank you, Fernando.
2
Unilever
Q1 2026 Trading Statement
Let me start with our growth profile in the quarter.
We delivered 3.8% underlying sales growth, with volume at 2.9% and pricing at 0.9%,
maintaining a strong volume-led growth profile.
On a two-year basis, volume growth remains robust at 2.0% CAGR, reflecting the
improving quality and consistency of our growth.
Looking at performance on a quarterly basis, we have delivered average volume
growth of 2.5% over the last nine quarters, demonstrating the resilience and
repeatability of our model.
This consistency reflects the progress we are making to elevate our brands and execute
flawlessly in our markets through Desire at Scale.
Growth continues to be driven by our Power Brands, which grew 5%, with 4% from
volume. These brands represent 78% of turnover and remain our primary growth
engine.
The rest of the portfolio grew at a lower rate due to a few specific factors:
in Foods, commodity deflation weighed on our tea brands in India
-
in Beauty and Personal Care, we are prioritising investment behind brands with
strong momentum while reducing support for tail brands.
Pricing in the quarter was 0.9%. This reflects the carryover impact of price reductions in
Home Care, notably in Brazil and in liquids in India; tea deflation in India and increased
in-store activation and shelf investment in Personal Care linked to our FIFA World Cup
activations.
3
Unilever
Q1 2026 Trading Statement
As we look ahead, and given the commodity cost environment, we expect pricing to
play a bigger role as the year progresses, particularly into the second half.
Importantly, our competitive position remains stable in both value and volume terms.
Beauty & Wellbeing delivered 3.6% underlying sales growth, with 1.9% from volume and
1.6% from price, driven by a solid performance across the Beauty portfolio.
Hair delivered high-single digit growth, led by double-digit growth in Dove Hair and K18,
with premium innovations such as Dove UV repair and Glow, bringing advanced
protection against UV damage. We also saw improving performance in Sunsilk and
Clear, with growth becoming more balanced across markets.
Skin grew low-single digit, with strong growth in Vaseline, supported by the Pro-Derma
Body range. This was complemented by continued momentum in Dermalogica and
Tatcha, partially offset by a weaker performance in local brands.
Wellbeing declined low-single digit, reflecting a very strong Q1 comparator of over 23%
in the prior year. Olly delivered double-digit growth, supported by digital commerce
momentum and distribution gains. We expect performance to improve from Q2, driven
by Liquid I.V. and Nutrafol, as campaigns to drive multiple usage occasions and attract
new consumers gain traction.
Personal Care delivered 3.7% underlying sales growth, with 1.1% from volume and 2.5%
from price, with volume showing sequential improvement.
Dove continued to lead growth, delivering double-digit growth in Deodorants and highsingle digit growth in Skin Cleansing.
4
Unilever
Q1 2026 Trading Statement
At a category level, Deodorants and Skin Cleansing both delivered mid-single digit
growth, supported by strong performance in North America.
In Deodorants, growth was broad-based, with sequential improvement in Rexona and
Axe, including early signs of recovery in Brazil.
Skin Cleansing growth was supported by the continued rollout of premium innovations
such as Dove Serum + Oils Body Wash, with strong performance in emerging markets.
Oral Care was flat, with growth in Asia Pacific Africa offset by softer performance in
Europe.
We are excited by our FIFA World Cup 2026™ platform, activations and campaign. These
will scale in the coming quarters and amplify growth momentum, particularly in
Deodorants.
Home Care delivered 6.1% underlying sales growth, with 6.2% from volume and price
broadly flat, reflecting strong volume-led growth led by emerging markets.
Brazil delivered double-digit volume growth, while India delivered high-single digit
volume growth, with double-digit growth in liquids and record market share in
powders.
At a category level, Fabric Cleaning and Fabric Enhancers both delivered mid-single
digit growth, led by our premium portfolio.
In Fabric Cleaning, this included double-digit growth in liquids, supported by the rollout
of new Wonder Wash variants, alongside a return to growth in powders. Wonder Wash
is now available in 41 countries. Fabric Enhancers continued to benefit from the strength
of Comfort.
5
Unilever
Q1 2026 Trading Statement
Home & Hygiene also delivered mid-single digit growth, with Cif continuing to perform
strongly, supported by the launch of Cif Infinite clean Anti-bac.
Looking ahead, given commodity pressures, we expect more balance between volume
and price in the coming quarters.
Foods delivered underlying sales growth of 2.2%, with 2.4% from volume and price
slightly negative, reflecting volume-led growth across both retail and food service.
Hellmann’s delivered mid-single digit volume growth, supported by the continued
success of its premium, flavour-led innovations and strong execution across markets.
Performance was particularly strong in Brazil, supported by the NBA campaign, and in
the UK with the launch of the new Ranch range.
Cooking Aids delivered low-single digit growth, with strong performance in Asia Pacific
Africa partly offset by softer conditions in developed markets, notably Europe.
Unilever Food Solutions also grew low-single digit, supported by improving trends in
away-from-home consumption, particularly in China, its largest market.
We will continue to step up innovation and sharpen execution to sustain and strengthen
our competitive growth.
Emerging markets delivered strong broad-based growth, with improving momentum
across key markets.
Asia Pacific Africa delivered 5.9% underlying sales growth, with 5.0% from volume,
reflecting broad-based performance and improving competitiveness across markets.
6
Unilever
Q1 2026 Trading Statement
Over the last three quarters, on average, we have delivered volume-led growth of
around 6%.
India accelerated to 7%, with 6% volume growth, continuing the improving momentum
seen over recent quarters. Growth was broad-based, with Home Care and Beauty &
Wellbeing performing strongly, and solid delivery across the rest of the portfolio.
Importantly, this is not driven by a single category or short-term factor.
It reflects the progress we are making on sharper portfolio choices, fewer, bigger
growth bets, and improved execution across channels, with higher-growth segments
and premium parts of the portfolio contributing disproportionately to performance.
We are also seeing continued progress in newer channels and demand drivers,
including e-commerce and modern trade, which are growing ahead of the core
business and supporting overall mix.
In China, we delivered another quarter of mid-single digit growth, in what remains a
highly competitive market environment with differentiated growth across channels.
Performance was driven by Beauty & Wellbeing and Personal Care, supported by
premium innovation, improved go-to-market execution, and continued progress in
social and digital channels. We are seeing improving competitiveness, particularly in our
Power Brands.
Indonesia delivered solid growth of 4% which reflects a clear improvement in the
trajectory of the business following the reset.
We are now seeing a return to more sustainable growth levels, with underlying
performance stronger than reported trends, supported by improved execution across
7
Unilever
Q1 2026 Trading Statement
channels, stronger innovation pipelines, and better activation in both traditional and
modern trade.
Importantly, market shares have stabilised, with around half of the business now gaining
share, reflecting progress from the actions taken, although there is still more to do to
fully restore competitiveness.
We are also seeing strong growth in newer channels, including health & beauty and ecommerce, which are growing ahead of the core business and contributing to overall
momentum.
We also delivered strong growth across several other markets in the region, with
double-digit volume growth in Turkey, Vietnam, Pakistan and Australia.
The Middle East represents around 2% of our turnover, and our operations in the region
remained intact in Q1, with no material disruption to supply. Our priority remains the
safety of our teams working in the region.
More broadly, we have built a highly localised and flexible supply chain, which,
together with inventory covers, has enabled us to manage the situation effectively to
date. We continue to monitor and take proactive actions in what remains a volatile
environment.
Turning to Latin America, we delivered 6.2% underlying sales growth, with solid volume
growth of 2.6% alongside 3.5% pricing, reflecting a clear improvement in momentum
across the region.
This was supported by a strong volume performance in Brazil Laundry, following
corrective pricing actions, and in Mexico Personal Care driven by operational
improvements.
8
Unilever
Q1 2026 Trading Statement
Beauty & Wellbeing delivered double-digit growth, with good performance across key
markets.
Developed markets delivered a mixed performance in the quarter.
North America delivered resilient performance in a soft market, with 2.1% growth driven
by 2.2% volume, while price was slightly negative. This reflects the strength of our
execution and the competitiveness of our portfolio, with continued momentum in our
Power Brands.
Growth was led by Personal Care, which delivered mid-single digit growth, with strong
volume momentum in deodorants and skin cleansing, underpinned by continued
strength in Dove and our premium innovations.
In Beauty & Wellbeing, volume-led growth in skin care and hair care was offset by
Wellbeing, which declined against a strong prior-year comparator.
In Foods, performance was flat overall, with Hellmann’s continuing to deliver good
volume growth.
In Europe, underlying sales declined 0.9%, with a 1.2% decline in volume and 0.3% growth
from price.
Performance reflects a soft market environment across categories, with consumer
demand remaining subdued.
Within that, premium innovations supported growth in categories such as Laundry,
Deodorants and Condiments. Our largest category, Cooking Aids, declined low-single
digit in line with market conditions.
9
Unilever
Q1 2026 Trading Statement
Turnover for the quarter was 12.6 billion euros, down 3.3% year-on-year.
Underlying growth of 3.8% was more than offset by currency headwinds, with FX
reducing reported turnover by 7.7%. Given that currency devaluation was more
pronounced in the second half of 2025, the base effect should ease as the year
progresses, and based on April spot rates we expect the full-year currency impact on
turnover to be lower, at around minus 3%.
Portfolio changes contributed a net positive 0.9%, with acquisitions adding 1.4%,
reflecting the strong performances of Dr. Squatch, Wild and Minimalist, partly offset by
a 0.5% impact from disposals, primarily relating to Foods and the tea business in
Indonesia.
Our full year outlook which remains unchanged.
We expect underlying sales growth for full year 2026 to be at the bottom end of our
multi-year guidance range of 4% to 6%, with at least 2% underlying volume growth for
the full year.
On margin, we expect a modest improvement versus last year, with broadly similar
absolute margin levels between the first and second halves.
This is supported by volume growth, mix improvement, continued savings and benefits
from our productivity programme, which continues to run ahead of schedule and has
already delivered 750 million euros by the end of Q1. We will maintain competitive and
healthy levels of brand investment.
Given current environment, there are a number of moving parts — particularly around
input costs, pricing and market conditions — and we will continue to manage these with
discipline.
10
Unilever
Q1 2026 Trading Statement
On capital returns, today, we initiated a 1.5 billion euros share buyback, and we remain
committed to sustained, attractive and growing dividends. We expect to complete the
programme towards the end of the first half.
Our medium-term leverage target remains around 2.0x. We expect to be below 2.0x
immediately following the separation of Foods.
With that, over to you, Fernando
FERNANDO FERNANDEZ
Thank you, Srini.
Let me come back now to the broader steps we are taking to build a simpler, sharper,
faster Unilever.
At the highest level, there are three things we are doing – and they are very much
interconnected.
First, elevating our brands to outperform markets in volume growth.
-
Second, stepping up operational excellence across all our geographies.
-
And third, taking decisive portfolio actions to unlock value.
Let me start with the first - Desire at Scale. This is the model we are using to elevate the
quality, relevance and the reach of our brands. And it is, without question, the single
biggest driver of the improvement we are seeing in the Unmissable Brand Superiority
scores of our portfolio and in the volume growth rates of our Power Brands.
11
Unilever
Q1 2026 Trading Statement
Desire at Scale is built around a very clear and simple framework – what we call ‘SASSY’
brands.
It is about brands that are rooted in superior science with top notch aesthetics and
visibility and with truly compelling sensorials. Brands that are talked about,
recommended by many to many, and that are culturally relevant.
Simple. Clear. Effective.
You can see this very clearly in brands like Dove and Vaseline.
Dove is now close to a 7 billion euro brand, and it has delivered more than 6% growth
for 14 consecutive quarters. Over the last five years, it has added around 2 billion euros
of incremental turnover. And that is coming from a step-change in product superiority,
combined with a completely different model of consumer engagement – with more
than 100,000 creators actively working with the brand.
Or take Vaseline. A 150-year-old brand that we have fundamentally transformed. It has
been delivering double-digit growth over the last 5 years. And by combining superior
science with cultural relevance, it is now building real momentum with younger
consumers. For example, delivering more than 100% growth in Tik Tok Shop in South
East Asia - a demonstration of Vaseline’s strength in social commerce at scale.
The second element is operational excellence. Because Desire at Scale only works if it is
supported by flawless execution. This is about how we create categories and how we
execute in the market, together with our customers. Understanding consumers better,
activating brilliantly and executing perfectly in-store, both offline and online.
Again, we have a growing number of great examples.
12
Unilever
Q1 2026 Trading Statement
Like Dirt is Good and Wonder Wash - an innovation anchored in superior science,
already at around €200 million of annualised turnover. By redefining the category to
short wash cycles, Wonder Wash is strengthening our position in the fast-growing
segment of laundry liquids and scaling up at speed.
Or Hellmann’s. Flavoured mayo is now in 35 markets and has already reached €100
million of annualised turnover.
Different brands. Different categories. Different geographies.
All benefiting from a common marketing philosophy rooted in what consumers expect
and demand of brands today: brands that are a creative and dynamic reflection of the
present, and not a tired representation of the past.
Let me turn now to the third element – the portfolio. Here, we are taking decisive action
to unlock value through the separation of Foods and its combination with McCormick.
And we are doing this from a position of strength, fully aligned with the strategy we
have been executing.
The transaction we have announced creates two businesses with improved growth
profiles.
First, a simpler and more focused Unilever – a pureplay HPC business.
A business with a very coherent portfolio, where around 90% of turnover is in number
one or two positions, and with a proven ability to deliver top-tier volume growth and
top tier return on invested capital. Given relative valuation and relative in market
performance to peers, we see clear valuation upside here.
13
Unilever
Q1 2026 Trading Statement
Second, a highly distinctive foods business. A scaled, global flavour powerhouse, with
iconic brands and leading positions in attractive segments of the Foods market, and with
significant revenue growth potential.
There is a clear strategic fit between Unilever Foods and McCormick, centred around
complementary geographic footprints, a stronger presence in retail, a scaled business
across Food Service channels, and leading science and Research & Development
capabilities focused exclusively on flavour.
It is for all these reasons I am referring to this as a growth-led separation of our Foods
business; one that will give shareholders the same level of exposure to Foods, but with
much higher quality exposure to Foods, and more optionality than today.
We know that this is a significant change and that it has to be delivered flawlessly. We
are confident that it will.
We have proven experience in separations – most recently with Ice Cream.
Our experience confirms our ability to separate a business of scale while delivering
topline growth, volume and margin progression; and the TSAs will ensure continuity,
while providing the time needed to remove stranded costs before they impact the P&L.
We already have dedicated teams in place working closely and collaboratively
alongside McCormick, who themselves have a strong integration track record. All
workstreams to separate Foods from Unilever and integrate it into McCormick are now
in motion. We are moving fast.
With that, let me briefly sum up after what has been a positive start to 2026 for Unilever.
14
Unilever
Q1 2026 Trading Statement
It was a quarter in which we once again demonstrated our ability to both perform and
transform.
Performance comes in the shape of superior volume-led growth – our single, biggest
priority – driven by our Power Brands and by one of our distinctive assets – our strength
in Emerging Markets business.
Underpinning this positive start to the year is a further step-up in operational discipline,
something which becomes even more important in light of the current heightened
macroeconomic uncertainties.
We will manage the business in a more volatile cost environment, focusing on volume
growth, price competitiveness and disciplined management of every single line of the
P&L. We will emphasise the drivers of demand that have the highest return in the
current context.
We are confident in our delivery, and we are re-asserting our full year outlook for 2026.
We have taken a decisive action to transform our future portfolio, and we have done it
from a position of strength and driven by a growth mindset.
Our organisation today is stronger. Our portfolio is sharper. Our priorities are clearer.
And Desire at Scale is breathing new life into our Power Brands and into our marketing.
We are now capitalising on these developments with much more disciplined in market
execution. And wherever we have made decisive interventions, like Indonesia, China, or
more recently in Brazil, positive results are showing up.
To go through these changes in more depth, we look forward to hosting a Capital
Markets Day on 4th November, when we will go deeper into how we will capitalise on
15
Unilever
Q1 2026 Trading Statement
our new sharper, fully focused, Home and Personal Care pure play; one that is aligned
to:
higher growth categories;
-
faster growing geographies;
-
more premium segments;
-
and a superior route to market.
For now, thank you for listening. We look forward to taking your questions.
OPERATOR:
Many thanks for joining the call. If you would like to ask a question, please press star
followed by one on your keypad. If you no longer wish to ask a question, please press
star Q to exit the queue. Your name will be called out when you are to answer the
question. Please keep your questions to a maximum of two.
JEMMA SPALTON:
Thank you very much for joining the call, our first question comes from Warren at
Barclays. Go ahead Warren.
WARREN ACKERMAN:
Good morning, Fernando, Srini, and Jemma. Warren here. One housekeeping: did you
say North America would accelerate from here? It was a bit quick, so if you could
clarify that. My two questions are, firstly Fernando, on emerging markets are you able to
talk about the four big engines of Brazil, India, China and Indonesia as we look into Q2
and the second half. Any signs of a slowdown also in Southeast Asia? Just so the EM
outlook from here, you obviously have easy comparator in places like LATAM. Then
secondly, Srini, on the margin guidance with oil, are you able to give us an NMI number
and how much scope do you have push productivity savings and or price to make sure
you are indeed able to deliver the margin guide despite higher oil, thank you.
16
Unilever
Q1 2026 Trading Statement
FERNANDO FERNANDEZ:
Cool. Thank you, Warren. I will cover the geographical part and Srini will cover the cost
one. Well, let me start saying that we are pleased with our good start to the year, 3.8%
USG, 2.9% in volume, Power Brands at 4% USG. Dove, our largest brand, at 7% USG and
we have seen also a strong start to quarter two, despite all the uncertainties that are
very obvious to everyone in terms of geopolitical and macroeconomic environment so
momentum continues in the business. Regarding emerging markets, as I mentioned this
many, many times, but our strength in emerging markets is definitely a long-term
competitive advantage given the exposure it gives us to better population growth rate,
wealth expansion. And we know this gap versus developed markets are reducing
versus the past, but it remains significant and the resilience of our portfolio in emerging
markets is a particular advantage when you have to drive the business in conditions of
significant volatility. Regarding the specific regions you mentioned, in Latin America, our
performance is accelerating. We deliver more than 6% underlying sales growth in the
quarter. Foods and Beauty & Wellbeing keep performing strongly as they did in 2025,
but we are also starting to see the impact of the decisive actions we have taken in both
Laundry and Deodorants, particularly in Brazil. In Brazil, we deliver double digit growth
in Laundry. Two reasons for that, the successful introduction of Wonder Wash in the
Liquids segment, but also the return we are seeing for the correction in pricing that we
have done to restore competitiveness in the Powders segment, that is the largest in the
laundry categories. In Deos also, we are seeing momentum there. The aerosol format is
recovering. This is crucial to boost market growth and also to boost our
competitiveness. We are in early stages of that recovery we see this will accelerate in
quarter two with the FIFA World Cup 2026™ activity that we will have, and with the
setup of the new planograms that we have done in partnership with our retailers. India,
Srini can cover in more detail, but a strong broad-based performance, 9% growth in
Home Care, 8% in Beauty & Wellbeing, 5% both in Personal Care and Foods. India, Srini
can cover a bit more on that. China, returned to mid-single digit growth. We are very
pleased with the improvements in Food Service, particularly in China. We are seeing the
out of home channel in China picking up, and that's very important for our most
17
Unilever
Q1 2026 Trading Statement
important Food Service business, that is the one in China. And Indonesia, run rate
continue improving. It's the fifth consecutive quarter with run rate improving. We deliver
4% growth. That is much more sustainable. Of course, we have had in the second half of
last year, very low comparators there, but performance is good. In US, as you know, we
have delivered 4% volume growth in North America in the last three years. It has been a
very consistent performance despite tough markets. Probably has been one of the best
performances in the sector, and we believe this performance is a reflection of the
profound transformation we have done to our portfolio. And we are seeing also
significant improvement in our relationship with customers. I have mentioned before
that in the Advantage survey, we have ranked number one in Personal Care and Foods,
number three in Beauty & Wellbeing, but recently we have received the Consumable
Supplier of the Year Award and the Excellence in Assortment Award from the largest US
retailer. This is another evidence that our partnership with retailers in US is really going
from strength to strength. Quarter one was softer at 2.1% USG. All came from volume.
Performance in Personal Care was strong. Great performance in Dove Hair and
TRESemmé styling. But the quarter was affected by weak performance in Foods and
Wellbeing. Wellbeing had very, very strong comparators, more than 20% in the same
quarter last year, more than 40% in Liquid IV but we remain very, very confident of the
structural growth potential of the Wellbeing verticals, and we see Wellbeing firmly
back into growth in US in Q2. There are a couple of brands that we need to fix in US,
particularly Nexxus and Shea Moisture in Hair Care, but we see our performance in US
accelerating from Q2 onwards. Srini?
SRINIVAS PHATAK:
Yeah. Thanks, Fernando. Thanks, Warren. I'll cover it in two parts. First, I'll talk a bit about
India, then I'll go on to commodity inflation and how we're going to manage that. I think
the point Fernando made is the right one. The quality of performance in India has been
of a very high order. It's just not the headline number, but it's across the breadth of the
performance, which is broad based. Giving you some colour, let's say when we look at it
from a Home Care perspective, while growth was at 9%, what is really impressive is that
18
Unilever
Q1 2026 Trading Statement
in Liquids we have grown double digit. That's really leading the market development.
And in Powders, we've actually hit record shares. That's on that. If I really talk about, let's
say, Beauty and Wellbeing, the strong momentum in Hair continues, and we are making
very clear choices and investments between quick commerce, e-commerce, and
broader omnichannel. The pricing actions along with the GST have started to spur
growth in this. Even the new age brands such as Minimalist are performing quite well in
the market, and that's giving us a lot of confidence in this segment. Personal Care
growth was at 5%, but strong step up in the premium segment, which is including Dove
and Pears. And for example, in a market development opportunities such as body
washes, we have actually gained about 400 basis points of share, which again starts to
step up well into the future. And last element, when you think from a Foods perspective,
we've also seen a bit of an uptick, actually an improvement in Horlicks with all the
actions we have taken. While there is some deflation in tea, but overall, from a volume
and a value perspective, the Foods business is looking good. This is all aligned to the
strategic progress that we've made across the four pillars of segmenting consumers,
making our brands desirable, accelerating the frontline capabilities, and making fewer
and bigger bets. Just to add a couple of elements, we have put in a new organization to
really address our quick commerce and e-commerce and omnichannel capability- that
is functioning well. From a general trade perspective, we have increased the outlet
coverage by about 200,000 outlets, which takes us to about 2.3 million, and the India
operating model is actually enabling us to drive execution and agility. It's also important
to highlight one element from an India context. While there is inflation, and there will be
both from an imported crude as well as currency, it's important to highlight that
classically, in a category such as Home Care, this actually works in our favour. We have
the portfolio to cater to the different price points through brands, but more importantly,
a lot of the local players get constrained both from a supply perspective as well as cash.
So you have the unique opportunity and the ability to actually manage the right price
and volume equation in India and continue to keep the growth momentum going. So
therefore, from a broad demand outlook perspective, India is looking good, and we are
quite confident in terms of our ability to continue to keep the growth momentum.
19
Unilever
Q1 2026 Trading Statement
Now, coming to the question on cost and commodity, I will take a little bit of time to
explain this. I do appreciate that it's on everyone's mind. First and foremost, we want to
reiterate that there is no change to the Unilever value creation model. Our model is built
on volume-led growths, premiumization in mix, driving gross margins to invest behind
our brands, and keeping a very tight discipline in terms of the cost. While you all know
we have made significant progress in the past few years in terms of our gross margin
expansion, upwards of 400 basis points, we've also increased our investments behind
our brands from about 13% to 16%, and we have continued to drive a model which works
for us on a multi-year basis.
If I just give a bit of a context to 2025, again, it's important to see last year we had
reasonable amount of commodity inflation, but a significant pressure coming from
currencies. From an EPS or an earnings perspective, the currency drag last year was as
high as 8.8%. When you contrast it to this year, given the commodity outlook, we will
expect commodity inflation to be higher. But from a currency perspective this year, we
definitely see that it's going to be much better. Even when you see when we've called
out in the earnings call, we expected the impact of Forex on our top line should be
more normalized to (3)% and if you contrast it to last year, that was (6)%. So the key
essence of the message here is, while we will see inflation from a commodity, currency
at an aggregate will really be, from the information we have, favourable for us. Now,
coming to the inflation, of course, the Middle East crisis has created uncertainties and
has made the outlook a bit challenging. Inflation for us is just not one number. While
there is crude and everyone really anchors around crude, it is complex because there
are many crude linked derivatives. There is forex, there are elements of supply chain
costs, wage inflation, and others. So at a commodity level, there are elements which
then start to play out differently. Our expectation for the full year inflation is in the
range of about €750 million to €900 million. This is the total inflation, this is just not
material inflation, but also the non-material costs, including logistics and our factory
operations. If you were to put it into context, this will be about €350 million to €500
20
Unilever
Q1 2026 Trading Statement
million higher than our prior expectations when we began the year. Our working
assumption for all these costs is really crude at around $100. While we are all looking at
the spot crude, which is today's context of $124 or yesterday it was $110, it's also
important to highlight that when you really look at the futures, quarter three futures are
still at $100, and quarter four futures are at about $90. On a balance, therefore, what we
have done is to really take $100 as a working assumption in our guide, and on that basis,
we have said that we will continue to deliver a modest margin expansion. Couple of
other elements to highlight in this, because that becomes very important. When we
really see it from a category perspective, when you see Beauty and Wellbeing and
Personal Care, the aggregate levels of inflation that we see in 2026 are not materially
different to what we experienced in the prior year. And in the prior year, we have
managed both the volume and the pricing extremely well in these two Business Groups.
The place where we will see heightened inflation, actually 50% of the total net inflation
for us is coming through in Home Care, and 70% of that is actually focused around the
emerging markets. We are deploying the full range of mitigation opportunities,
competitive buying, commodity covers, formulation flexibility, packaging interventions,
SKU focus, and productivity across the value chain, and a complete and a very tight
control over the discretionary costs. At this level of inflation, we do recognize while we
will drive all of this, it will or it may not be possible for us to just cover it from the cost
actions, so we will take pricing. Pricing will be needed in selected markets and
categories, notably Home Care. It will be calibrated and it will be done in a competitive
manner. Our priority will be to really protect the consumer value while also taking care
of our financial model. On this point, again, it's good to repeat that in emerging markets,
given the strength of our portfolio, our ability to be judicious in the way we manage
pricing, we will have levers to manage it in a sensible manner is a good point.
Just last two points to complete the picture on this. On brand investments, we will
continue to invest behind our brands at competitive levels to sustain the growth
momentum. And we always said that our competitive spends will be classically in the
range of 15 to 16%, and therefore we are not going back to an era of under-investing, but
we will ensure that the spend is deployed effectively and in the right channels. From an
21
Unilever
Q1 2026 Trading Statement
overheads perspective, you have seen that we have already delivered €750 million, so
almost 80 million incremental savings in quarter one. We are more than confident that
we will complete the €800 million program in the next quarter, and given the various
series of measures that we have taken to manage costs, we will drive this harder and
deliver higher savings. So in an essence, in this range of €750 to €900 million, we are
comfortable to say that we can manage competitive growth, deliver on our guide of 4
to 6% USG, and drive modest margin expansion.
JEMMA SPALTON:
Thank you. Our next question comes from Celine at JP Morgan. Go ahead, Celine
CELINE PANNUTI:
Yes, good morning, everyone. So my first question is on the balance of growth for the
year. So you reiterated your guidance to be at the low end of 4 to 6, and I understand
that price mix will be more balanced in Home Care as we go through the year. Can you
talk about, first of all, that volume will be above 2% for the year, and when we look at
your two category Beauty & Wellbeing and Personal Care, volume was below, in fact,
that 2%. Should we fairly expect that this will be in the range of two each for the year?
And what should drive that acceleration in the second half?
And then my second question is coming back on maybe Wellbeing. You said it was
down low-single digit. Is it possible to understand how was it in the US versus the rest of
the world? What's happening in the rest of the world in terms of your white space
opportunity? And in the US, if you could go a bit deeper in understanding Nutrafol and
Liquid I.V. performance and the go forward. Thank you.
FERNANDO FERNANDEZ:
Thank you, Celine. Yeah, we are confident in delivering above 2% volume growth. If you
look at the last nine quarters, '24, '25, and quarter one '26, our average volume growth
has been 2.5%. And we had a good start to the year with 2.9% in the first quarter and as I
22
Unilever
Q1 2026 Trading Statement
mentioned before, we have a good start of the quarter two. I feel the key point to say is
just this is the result of brand equities that are strengthening. More than 60% of our
revenue is increasing, what we call Unmissable Brand Superiority score. We have a
great innovation plan, one of the best that we have had in years, hitting the markets
now. And we have one of the strongest activation platforms in years with the Personal
Care sponsorship of FIFA World Cup 2026™, so this give us real confidence that we will
deliver volume growth for the year above 2%. Turnover-weighted market volume
growth is in the territory of 1%, so this clearly shows outperformance of the markets
when it comes to volume growth. We expect pricing to accelerate along the year, so
we expect the H1, our growth to be led by volume. We expect better balance between
volume and price in the second half of the year.
And when it comes to Beauty & Wellbeing, basically, we delivered 3.6% in Q1. Our
Beauty business performed really strongly, but Wellbeing was dilutive for the first time
since we entered the category. We had a great quarter in Hair Care with high singledigit growth, and we have a great quarter in Prestige, where we grew around 10%.
Strong results across every single period of Prestige in skin, in hair, and in colour
cosmetics, particularly at the highest end of pricing, brands like Tatcha, Hourglass, and
K18 really performing very very well. Regarding Wellbeing, we declined 2%. Our
Wellbeing business continue being fundamentally anchored in the US, so the
international business grew nicely, but it doesn't change the overall numbers of
Wellbeing. Olly grew 18% in the quarter, but we have some issues in Liquid I.V. and
Nutrafol that we have to sort out. In Liquid I.V., we lapped a comparator of more than
40% growth last year. There was a different phasing in the shipments prior to the
summer season in US. We continue seeing solid growth in the powdered hydration
market, but our share has been a bit under pressure due to a new wave of market
entrants that have reduced our share of assortment in the category. We have seen this
many many times before since we acquired Liquid I.V. in 2020. Hundreds of new brands
enter in the category, but very few can sustain velocity after some period of time. Liquid
I.V. is four times the size of the second player in the category. We are reinforcing our
23
Unilever
Q1 2026 Trading Statement
plans to regain share, and we are very, very confident that we will have a strong quarter
two for Liquid IV. In the case of Nutrafol, the brand continues having exceptional levels
of retention. I have never seen anything like that in any brand I have worked in my
career. But we need to address the issue of a significant increase in the cost of acquiring
new customers. We have seen particularly telehealth platforms in the US significantly
investing in the cross-selling of GLP-1 injectables and hair fall products, most of them
with significant negative side effects. We are addressing this. We are highlighting the
clinical superiority and the no side effects of Nutrafol, and we expect in the case of
Nutrafol, the results to become better in the second half of the year. The brand was
flattish in Q1.
JEMMA SPALTON:
Thank you, our next question comes from Nicolas at Bank of America, go ahead Nicolas.
NICOLAS CERON:
Good morning. Thank you. Two questions from me, please. The first one is coming back
on the pricing element. Are you pricing enough in Asia, PAC, Africa? Because I see your
pricing is around 1%, and the FX is down (10)%. Do you think that kind of gap is
sustainable, or do you expect that to close in the future? And then just if you could talk a
bit about Dr. Squatch. We've seen a lot of slowdown in scanner data. So if you could just
update us on whether you think that brand is still on track to achieve their business case.
Thank you.
FERNANDO FERNANDEZ:
Let me start by Dr. Squatch, and then Srini will cover pricing. A good performance
overall of Dr. Squatch. We are seeing significant growth in body shower and in
deodorants in particular. We see some slowdown in the Dr. Squatch bar segment. But
we expect Dr. Squatch will be part of our underlying sales growth from September, if
I'm not wrong. And we expect double-digit growth in Dr. Squatch going forward. So we
have been delisting some items that we didn't think were fundamental for the brand
24
Unilever
Q1 2026 Trading Statement
going forward. This is affecting some of the share reading, but in the core of Dr. Squatch,
the performance is strong, and we see this as a strong contributor to our growth from
September onwards in the US market. Srini?
SRINIVAS PHATAK:
So from a pricing perspective, what you will see is that it's important to say that you will
start to see a step-up in the pricing. Q1 low pricing also gets explained by what's
happening in a few of our categories. For example, if you see in the case of India, we
had deflation in Tea, and therefore that has played out. That does not impact the value
creation in the model there. In the last year, we'd also taken pricing corrections in our
Liquids part of the portfolio, which actually annualize in Q1. So in that sense, if what you
see in the Q1 is the lowest point of it, we've already initiated price increases, and that's
coming through right from quarter one to Q2. We'll start to see the benefit going
forward. In case of Home Care, at a broader level, it also impacts some of the... I'm also
giving you a broader question on pricing. This also reflects some of the actions we took
in Brazil and Latin America, which actually will then start to annualize again in a matter
of one more quarter. So broadly speaking, from a pricing perspective, what you see is a
reflection of the tail end of some of the actions which we have taken in the prior year
and which have given us benefits. Going forward, we are pricing up in a sensible and a
competitive manner to while cover commodity when it comes to the commodity-linked
categories and linked to innovations in Beauty & Wellbeing. And therefore, you will start
to see a step-up on pricing right from quarter two. And as Fernando has alluded to see,
you will see a better mix of it, and it'll improve progressively as we go into half two.
FERNANDO FERNANDEZ:
Let me add something because I feel I have mentioned this before, but I want to repeat
it to be clear. The times of being uncompetitive in Unilever in any driver of demand are
gone and we will manage the business in a more volatile cost environment, focusing on
volume growth, on price competitiveness, and a disciplined management of every
single line of the P&L. We will emphasize the drivers of demand that have the highest
25
Unilever
Q1 2026 Trading Statement
return in the current context and ensure competitiveness in both pricing and brand
marketing investment with the assumptions that Srini has made in terms of the oil price
that we see and the impact that we have in cost inflation. Despite this, we continue to
see the possibility of increasing our operating margin in modest terms as we have
highlighted in our guidance.
JEMMA SPALTON:
Thank you. Our next question comes from Jeff at BNP. Go ahead, Jeff.
JEFF STENT:
Okay. Two questions, if I may. When you move into more inflationary environment,
historically, like for likes have always started to accelerate. So why are you still guiding
to the bottom end of the 4 to 6? Because obviously the inflationary backdrop is rather
different to what it was at the start of the year when you initially set the guide. That's the
first question.
And the second question is, we've heard one of your notable peers talking about some
suspicion that there may have been a degree of retailer stocking ahead of expected
price increases. I'm just wondering if you've seen any evidence of that, particularly in
the emerging markets business. Thank you.
FERNANDO FERNANDEZ:
Thank you, Jeff. I will cover the second part, and Srini can cover the inflationary
environment and the guidance. No, we have not seen any significant stocking. There
have been a few countries, the Easter facing has been different. But at the same time, as
I mentioned before, in the case of Liquid I.V., particularly in the US, our phasing has a bias
into Q2. So in terms of retailers stocking in anticipation of price increases, we have not
seen anything of material impact at all. So nothing in that space. On inflation, pricing?
26
Unilever
Q1 2026 Trading Statement
SRINIVAS PHATAK:
So I think two important points, Jeff. Obviously, we are going to ensure competitiveness
in both volume and price. And for the dynamics that I've explained, look, both from a
Beauty & Wellbeing point of view and Personal Care point of view, the inflation levels
are in the ballpark of what we handled last year. So when we take these into account,
yes, it actually gives us the confidence to say that we will be able to deliver our 2%
volume, as well as the 4 to 6 top line. However, what we're also conscious and cognizant
is that the levels of inflation which are coming through, and it's just not on our sector
alone, what we are likely to see that there could be a potential larger impact on
consumer and consumer sentiment. And the way inflation is going to land, given the
dynamics, it could also be different in different parts of the world. So we will require to
have some more visibility in terms of how consumer demand is playing out. We need to
have some more visibility in terms of how some of the buying patterns are playing out.
Therefore, it'll be prudent for us to actually come back and revisit the guide at half. So at
this stage, what we have therefore said on a prudent basis is to ensure that we give
confidence to the markets that we still will deliver our 4 to 6%, and we will come back
with a better read in a quarter's time, and then we could actually have a conversation
on the full year.
FERNANDO FERNANDEZ:
Mm-hmm. And I would like to reinforce, in the last earning call, I mentioned that we
firmly believe that in the long run, our combined category and geographical footprint
offer around 2% market volume growth and around 2 to 3% pricing. At that time, you
told me that the 2% pricing looked very far. The situation has changed now. But this is
what we have seen in the last decade or so. We expect the same to play out in the long
run. And as you know, most of the impact in pricing this year will be in the second half.
So we are cautious at this stage, and as Srini mentioned, we will revise this when it
comes second quarter results.
27
Unilever
Q1 2026 Trading Statement
JEMMA SPALTON:
Thank you. Our next question comes from James at RBC Capital Markets. Go ahead,
James.
JAMES EDWARDES JONES:
Thank you, Jemma. You're presenting your updated remuneration policy to the AGM in
a couple weeks' time. What's the thinking behind the annual bonus and performance
share plan kicking in for sales growth well below your 4 to 6% guidance?
FERNANDO FERNANDEZ:
Yeah, we are presenting the remuneration policy in the next AGM, that is the 13th of
May. There is a clear intention of becoming competitive with global companies in that
space when it comes to remuneration. And when it comes to the targets that we put at
the beginning of the year for our annual bonus, it reflected the market conditions, and it
reflected what top TSR performance implied. As we mentioned before, the situation
now has changed in terms of what is a potential inflationary context in which we are
working, and what we present the targets on an annual basis, and we will change that if
the next year, the conditions are different for the PSP and for the annual bonus.
SRINIVAS PHATAK:
So maybe just one additional element to add on that. The key is really the long-term
incentives, and actually a couple of the measures in the long-term incentives are
completely actually bulk of the remuneration there is linked to shareholder return and
outperformance. So 30% of the weighting in the long-term incentive continues to be on
TSR, therefore, that takes into account any of these changes. Second, if you actually,
again, look at it from a return on invested capital, that's again a long-term measure,
which is again linked to competitive outperformance. So, in some ways, I don't believe
that that materially changes. Anything that is coming in the remuneration policy is linked
to shareholder return.
28
Unilever
Q1 2026 Trading Statement
JEMMA SPALTON:
Thank you. Our next question comes from Olivier at Goldman Sachs. Go ahead, Olivier.
OLIVIER NICOLAI:
Thank you, Jemma. Good morning, Fernando, Srini. Two questions. First, you mentioned
previously that 50% of inflation is in Home Care. Can you perhaps comment on the
magnitude of the price increase in Home Care you would need to take to offset the
security cost inflation that you're seeing? And regarding other divisions like Personal
Care as well, should we expect a price increase? And then secondly, it might be a little
bit of a technical one, but notice that the share buyback is still at €1.5 billion the same
amount, but it's going to be done by July 6th. That's going to be done over the next 45
working days. Last year, it was done same amount, but it was more like 70-plus working
days. So any rationale for this increase in speed? Thank you.
FERNANDO FERNANDEZ:
Well, share buyback acceleration, it's very clear that the markets have suffered in terms
of valuation, and we are very confident in the future valuation of the company given
our performance. We really believe that the Unilever that we are shaping, as we
mentioned when we announced the McCormick transaction, is one that has been
bottom quartile in valuation with top quartile in performance. So this is a good moment
to make share buybacks, and it's a good moment to make share buybacks in an
accelerated way. Regarding Middle East conflict, I would like to highlight a couple of
things. First of all, Middle East represents for us around 2% of the revenue, and until now,
we have not seen any material impact in consumption level or disruptions in the
operations. Of course, the closure of the Strait of Hormuz may have potential
implications in terms of availability of petrochemical materials. But this can be an
opportunity for us, because we have a very resilient supply chain, a multipolar supply
chain with multiple sources of materials, and this resilience can imply a competitive
advantage. We see growth opportunity in laundry powders because we see local
29
Unilever
Q1 2026 Trading Statement
players, particularly in India and Southeast Asia being affected in terms of availability of
materials. Srini, you want to comment on the inflation in Home Care?
SRINIVAS PHATAK:
So just a couple of things. It is Home Care, and a lot of that, of the total inflation, 70%, is in
emerging markets, which therefore is an opportunity for us to actually be able to take
up prices. Having said that, in line with our own experience and best practices, and to
ensure our competitiveness, we will lead pricing where we are leaders, we will follow
where we are not. The price increases we will take will always be calibrated. There will
be frequent price increases, but in small doses. That ensures that we get the right
balance of giving value to the consumer while protecting our model. This could also
mean that there could be a bit of a lag between when commodity starts to hit, when
pricing starts to come in. Now, these are the elements which we'll have to continue to
monitor and validate, and therefore we will fine-tune. That's also the reason we talked
about all the other measures which start becoming important for us to manage the P&L,
from formulation to logistics to the manufacturing costs. And that's the only reason at
this stage, yes, we should expect pricing to be higher, but it's not going to be a one-toone correlation and for that reason, we will not be able to give you a specific guide
today. We could have a better conversation in three months' time when we have better
clarity of the environment and overall consumer demand.
FERNANDO FERNANDEZ:
And Olivier, I would like to highlight something that Srini mentioned in the beginning of
the call, because the situation is different in different markets. Very, very differently to
previous global crisis we have seen, we are seeing emerging market currencies holding
relatively well. If you take a market like Brazil, for the moment, we have seen an
appreciation of the currency that is higher than the increasing material cost that we are
having. So I feel the situation is very different for different Home Care business
depending on the geographies in which we are operating.
30
Unilever
Q1 2026 Trading Statement
JEMMA SPALTON:
Thank you. Our next question comes from Callum at Bernstein. Go ahead, Callum.
CALLUM ELLIOTT:
Great. Thank you very much. Just to start coming back to Home Care, please, the 6%
volume growth is obviously quite remarkable. Reading your commentary, it seems like
it's quite broad-based across Fabric Cleaning, Fabric Enhancers and Home & Hygiene.
But maybe you could just add some colour for us, please, on what are the drivers of that
6%, how much is market growth versus your share gain? What are your share gains
being driven by? And are there any one-off factors in the plus six that we should be
cognizant of?
And then my second is, actually unusually, coming back to remuneration. You had some
very interesting commentary and examples in the annual report about your ability, or
probably I should say inability, to attract talent, especially in the US, where it seems like
your compensation is just not market competitive. So my question is, how are you and
the Board thinking about this, given the strategic focus on growth in the US market, and
could there be pressures on margins if you need to structurally improve your
compensation packages? Thank you.
FERNANDO FERNANDEZ:
Thank you, Callum. Regarding Home Care, our comparator was relatively low in Home
Care, but I feel what is important to highlight that on a two-year basis, we have been
delivering consistently volume growth in Home Care above 3% and this is a combination
of a solid performance in Fabric Cleaning, and I would say a stellar performance in
Home & Hygiene and Fabric Enhancers. I feel Cif grew this quarter around 15%,
Domestos high-single digit. As Srini mentioned, in the case of India, we achieved the
highest ever share in laundry powders. We are increasing our position in Liquids
strongly. We have had double-digit volume growth in Brazil, in Fabric Cleaning, in
Vietnam, in Arabia, in Turkey, high single-digit growth in Argentina. So there is a broad31
Unilever
Q1 2026 Trading Statement
based very, very strong growth. And I believe it's a combination of really restoring our
pricing competitiveness in Powder, and at the same time accelerating the market
development of Liquids with an special role to Wonder Wash, that is already more than
200 million euros in annualized sales and is already present in 41 countries. So overall,
broad-based good performance in Home Care. We see momentum in the business, and
we see momentum in the three pillars of Home Care, in Fabric Cleaning, in Home &
Hygiene, and in Fabric Enhancers. Probably the one that is a bit slower, that is growing at
around 5%, is Dishwash. That is more exposed to Southeast Asia, and that's a category in
which we have seen a bit less dynamism.
In terms of remuneration, it's true, as you know, we have been looking at appointing
some top leaders in the organization from the outside. This is a very different Unilever, in
which the combination of born and bred talent and talent inflow from the outside is
much more balanced than in the past. We are increasing our exposure to the US, and we
are allocating significant capital into the US and it's very, very important that we are able
to compete with American companies when it comes to remuneration. We don't believe
that this has an impact at the global level in terms of our cost base, but we need to
really increase the ceiling of remuneration in the company to be able to ensure that we
can attract top-notch American talent, because at this stage and for many, many years,
we have been lacking leadership at the top of the organization coming from North
America, and this has to change in the future.
SRINIVAS PHATAK:
Maybe one small clarification on the question related to any one-offs in Home Care and
otherwise. At an aggregate Unilever, there is nothing specifically to be called out. Could
there be some small pockets of people buying in? Possible. Did we have some adverse
impact because of Eid timing? Slightly possible. So therefore, there are always some
small ins and outs in a few places, but when we look at it in an aggregate, there is
nothing that we would really call out as being something to point out from a quarter
perspective.
32
Unilever
Q1 2026 Trading Statement
FERNANDO FERNANDEZ:
And I believe it's important also to highlight that our distributor covers are one of the
minimums we have in history. So basically, this is showing the efficiency of our model,
our operational discipline, and also the care we are taking in ensuring that the working
capital across the value chain is properly managed.
JEMMA SPALTON:
Our next question is from Karel at Kepler. Go ahead, Karel.
KAREL ZOETE:
Yes, good morning. Thanks, Jemma. Two questions. The first one, I know you already
discussed market shares for a couple of individual markets and regions, but on an
aggregate level, what have your market shares done over the last quarter? And then
the other question is a follow-up on Latin America. You discussed Brazil, but what's the
trajectory going forward? Because it's been quite volatile in '25, but things seem to be
getting better. So what should we anticipate for LATAM as a region going forward?
FERNANDO FERNANDEZ:
Market share have been stable in the last few readings for us, after significant gains that
we have had around the first three quarters of 2025. Srini can give more colour on that.
Regarding Latin America, as I mentioned before, we have delivered 6% growth in the
quarter. We already in 2025, were having excellent performance in Foods and Beauty
and Wellbeing, but we have some issues in laundry and deodorants, particularly in
Brazil. This has been corrected. We see momentum in the business. The actions we have
taken in deos are at that early stage, so we probably will see further acceleration in our
Personal Care performance in Latin America. That is very important because
Deodorants in particular, Latin America, is a big contributor to the growth of the total
Personal Care business. So, a lot of confidence in our development in Latin America
33
Unilever
Q1 2026 Trading Statement
going forward. I would say in Americas overall, because we expect also North America
to be better from quarter to onwards so optimistic about it. Market share, Srini?
SRINIVAS PHATAK:
So, three simple messages, both from a value as well as a volume shares perspective,
we are relatively stable. I think that's actually quite encouraging just given the context
of where we are. It also is ensuring that we are in the right space, both in terms of
volume and our pricing in the market. Point number two, we have seen some positive
acceleration coming through in India, and that's understandable given the quality of the
performance which has come. I think that positions us well. The other element to
highlight is, again, when we see the last four weeks read in North America, we have
seen a strong comeback in some of our categories, most notably in Personal Care. That
again positions us well. So just a bit more colour to the comment, but at an aggregate,
shares are stable both on value and volume terms.
FERNANDO FERNANDEZ:
And remember that we cover around two-thirds of our revenue in market share
reading. If you look at our 2.9% volume growth and you compare with markets growing
around 1%, it's very clear that we are outperforming the market there.
JEMMA SPALTON:
Thank you. Our next question comes from David at Jefferies. Go ahead, David.
DAVID HAYES:
Thanks. So two for me, just firstly on Thailand. I know not a big market, but we picked up
that you lowered prices coming into April, and apparently a reaction to the struggles on
energy prices for the consumer. I think you explicitly made that point. So just wonder is
that something that you're having to do in other Asian markets, and is that something
you're doing proactively, or is there an element of government pressure in that market
or other markets to be seen to be helping consumers with the tougher environment?
34
Unilever
Q1 2026 Trading Statement
And the second question, just came back to the Home Care dynamics. Pricing obviously
been very low for the last nine quarters, up one or even negative for some of those
quarters. So just explain the dynamics there. Is that the input cost was deflationary, and
that's what was allowing that pricing, or is it a competitive intensity dynamic? And then
related to that and some of the moving parts you talked about, will Home Care margins
you think be up this year, or is that an area where you have to sacrifice profitability
given where the input costs lie and you make it up in other divisions? Thank you.
FERNANDO FERNANDEZ:
Let me cover a couple of things and then Home Care margins, Srini can take it. Thailand
is a very special situation. Thailand has entered into a conflict with Cambodia. Around 10
to 15% of the volumes of the Thailand market were flowing into Cambodia. That has
been closed. Fundamentally, this has made some players in the market to really react
with significant promotional investment. And we have reacted to really ensure that our
competitiveness was strong. So basically, it's a very, very peculiar situation. We have
seen some international players in particular reducing prices significantly. And as I
mentioned before, being uncompetitive in Unilever is not an option anymore, and we
have reacted to that. In the case of Home Care, yes, the context of it has been
deflationary for around, I would say, one year and a half. This is, of course, changing
now, and we see pricing in Home Care accelerating. We have been enjoying very, very
solid gross margins in Home Care, and our operating margin has been increasing
strongly. But you want to add some colour on that?
SRINIVAS PHATAK:
So the additional colour to that is that it's absolutely right that there has been
deflationary with crude sitting at about 60, which had actually started tapering off from
the mid-70s, and therefore that reflected in pricing. The other element, these are the
corrections which we actually put in the first half of last year. That's when we addressed
some of the places where we were not competitive, or we had to react to ensure we
were competitive, notably Brazil and India. We took those corrective actions. In all the
35
Unilever
Q1 2026 Trading Statement
markets that we operate today, we are on strategic pricing in Home Care. That positions
us extremely well and the way we have really articulated in terms of taking judicious
pricing, calibrated pricing, will position us well. Coming back to your question on
overall Home Care margins, it will be our first endeavour to ensure that each business
group really delivers on its financial model. But given the magnitude of some of the
commodity inflation and the lead lag between pricing and commodity, if we need to
really support Home Care and make it up in some other business groups and categories
and sales in the short term, we will do it. But that's something that we will do in a sensible
manner without impacting the competitiveness of any of the single sales.
FERNANDO FERNANDEZ:
And remember, David, also that Home Care is a category that is very sensitive to
volume, and we see opportunities coming from the constraints in supply in the global
market. Our supply chain is multipolar, it's very resilient. We are seeing some shortage in
some local players, particularly in India and Southeast Asia, that can support our
volumes, and it will make easier the passing of pricing in the future.
JEMMA SPALTON:
Thank you. Our next question comes from Jeremy at HSBC. Go ahead, Jeremy.
JEREMY FIALKO:
Yeah. Hi. Good morning. Thanks for taking the questions. A couple from me. First one is
perhaps you could talk a little bit about what you're seeing from a consumer standpoint
in some of the emerging markets, which on paper would be more affected by the
higher oil price, yet particularly some of those around Southeast Asia. Whether there's
been anything you've noticed in terms of how consumers are behaving, their
consumption patterns, or whether there isn't really a lot of evidence so far. And then the
second one is just on your margins. You talk about the margins being balanced in
absolute terms between the first and the second half, which on paper would mean that
the margin expansion you deliver for 2026 would be coming basically all in the second
36
Unilever
Q1 2026 Trading Statement
half. So given that's when the commodity pressure would hit more, could you talk about
what some of the other things you've got going in your favour in the second half to
make sure that you land the margin numbers that you currently expect? Thanks.
FERNANDO FERNANDEZ:
Yeah. Jeremy, emerging markets, we have not seen any material changes in market
volume growth at this stage. As I mentioned, we have been growing very nicely in
places like Vietnam, Pakistan, Bangladesh, Arabia, India, Philippines. Probably the
exception to that is Thailand, where, as I mentioned in David's questions, there has been
a pricing issue that we have to sort out. But overall, not materially impacting
consumption at this stage, coming from the higher fuel prices that are starting to
materialize in these countries. China, importantly for us, we have seen improvements in
China since mid-2025. We are solidly now operating at around 5% growth. And as I
mentioned before, particularly our Food Service business, that is important in the
context of China. We have seen some improvements in the out of home channel there
that is supporting the growth of the Food Service business. Margin?
SRINIVAS PHATAK:
So on the margins, I think there was a bit of a confusion in the marketplace in terms of
whether you talk about the absolute margins on the basis points. From a full year
perspective, we had delivered margins of 20%. If you looked at prior two years, there
was a bit of a lot more volatility and seasonality between half one and half two, with ice
cream moving away. We were in the space of saying that, look, we are likely to have
that steady margin profile from a first half and second half point of view. From a first
half perspective, we are trending well, given all the actions that we have taken, given
the volume-led growth and our gross margin progression. So we should see
improvement at least first half, maintaining last year's margins or a slight improvement.
That's what we're aiming for. Second half, we have discussed some of the cost
challenges and some of the actions that we are taking. At this stage, we believe that we
will have all the mitigants in place to cater to that, and therefore the overall approach.
37
Unilever
Q1 2026 Trading Statement
Best at this stage would be to really focus on how we want to navigate the environment,
the situation, and deliver the model on a full year basis. And we could actually have a
proper conversation at half one results with a better outlook on the full year.
JEMMA SPALTON:
Thank you. Our next question comes from Sarah at Morgan Stanley. Go ahead, Sarah.
SARAH SIMON:
Yes, good morning. Just following on from that shape of the margin. Should we expect
a significant skew in terms of marketing investment as a percentage of revenues
between H1 and H2, given the FIFA World Cup 2026™ stuff? Thanks.
FERNANDO FERNANDEZ:
No, we feel very comfortable with the investment that we are having in the market now.
We believe that we can operate between 15 and 16% in terms of brand marketing
investment. We have increased around 300 basis points our investment behind the
brands in the last three years. So we feel comfortable with that kind of level. We
measure that, of course, on a monthly basis. Our share both in the digital space and in
the old media space, is solid. And as I mentioned before, we will keep our
competitiveness as a key metric of success for us, ensuring that the enablers of demand,
both in terms of pricing and brand market investments, are solid. So don't expect
significant changes in the level of investment that we should have in the two halves.
SRINIVAS PHATAK:
So just, again, a little more colour, especially in the developing markets and what we
have seen historically, I'm not saying that that plays out exactly. When these kind of
levels of inflation do play out, as an industry, as a category, people do make calibration
between pricing and investments to ensure that they give the right value to the
consumers. What effectively that means that the media hit could come off significantly.
Our endeavour is to ensure that we invest adequately behind our brands. We do
38
Unilever
Q1 2026 Trading Statement
everything to support our innovations, but we will actually keep a lens if the media heat
does come off. We will ensure that we are deploying our resources effectively and not
really wasting some of the media money. I feel it's important that history shows that
when there is significant commodity inflation, there tends to be media deflation. So we
will look at, particularly in emerging markets. So that's something that we are looking in
detail, and our procurement team is very active in that space.
JEMMA SPALTON:
Our next question comes from Tom from Deutsche Bank go ahead, Tom.
TOM SYKES:
Yeah. Morning, everybody. Thank you. Just on the US, first of all, the share data in
Nielsen suggests that you're losing share of the Amazon channel, and that channel
seems to be growing the fastest in HPC, in Personal Care, Deos, and Bath and Shower,
very strong on Amazon. From your perspective, do you think you're holding share on
that channel, which seems to disproportionately be growing? And then on pricing on
Amazon, it's not annual contracts, as I understand, and so in theory, you could put up
pricing pretty quickly. Do you believe your pricing power or elasticity is the same on
Amazon as it would be on other channels? And a final one, just on the follow-up on the
media, is there any element in your increase of use of influencers and KOLs, et cetera,
that there is an inbuilt flexibility on what you pay them depending on volumes? And so
therefore, that would naturally come down a bit if volumes in, say, EMs came down,
please.
FERNANDO FERNANDEZ:
Yeah. The last question, yes, influencer cost is a variable cost. And pricing, of course, it
has a component of volume there. Regarding pricing in Amazon, we don't see a
fundamental difference between our pricing ability in the Amazon channel and the
offline channel. As you know, they are closely linked, because you have to ensure that
39
Unilever
Q1 2026 Trading Statement
there are no pricing conflict across channels so we don't see any fundamental issue
there. You want to talk about shares?
SRINIVAS PHATAK:
So what we really follow, Tom, is Circana has been more representative of some of the
share trends, whether it is in Amazon or broader e-commerce, d-commerce. Therefore,
progressively in the last 12, 18 months, we have validated the database, and that is what
we actually look at. The reads that we see on that continue to show much better. So
there is a divergence which is happening between the two data sources. But at an
aggregate, we are not seeing some of the elements that you have spoken about. But
happy to engage with you offline to go into further details.
FERNANDO FERNANDEZ:
Mm-hmm. Yeah, I don't have the latest number, but our growth in Amazon, it has been in
the high teens for 2025. I need to check exactly what it was in quarter one. I don't have
that data here.
JEMMA SPALTON:
Thank you. Our next question comes from Guillaume at UBS. Go ahead, Guillaume.
GUILLAUME DELMAS:
Thank you very much, and good morning, Fernando, Srini, and Jemma. Two questions
from me, please. First one is on Europe. Kind of second consecutive quarter now that
both USG and UVG are a bit soft. But wondering if it's mostly down to lower category
growth, or if you're also seeing some maybe challenges in terms of your market share
development in an environment that seems to be highly promotional. So maybe if you
can unpack this performance for us. And I guess looking ahead, do you expect similar
trends in Europe, or are you hopeful you can go back to positive USG and UVG in the
next quarter? And then my second question is on Foods. Appreciate it's really early
days, but Fernando, I'm wondering how the business has been reacting following the
40
Unilever
Q1 2026 Trading Statement
announcement of the deal with McCormick. And between now and the completion of
the deal, how to ensure that Foods doesn't get distracted too much by the carve out. I'm
sure for some employees, some job uncertainty. So I guess, what will be the focus for
Foods in the next four to five quarters? Thank you very much.
FERNANDO FERNANDEZ:
Thank you, Guillaume. Well, Europe indeed, the market has been subdued. We have had
very good share progress in Home Care and Personal Care in the last nine to 10 quarters.
Foods has been a bit more difficult. It's 40% of our revenue there, and we have seen
some increase in promotional pressure in Foods, and that has put some negative impact
on pricing that is affecting us. But we expect our performance in Europe to improve
along the year. We are really banking in a very strong quarter two in Personal Care with
all the FIFA activation that in Europe will be very, very significant. We are starting to roll
out some of our most successful Beauty & Wellbeing brands into Europe. So, we don't
expect Europe to become a key engine of growth in the future, but we expect a slight
recovery, despite the fact that the impact of energy prices in Europe can be significant
in terms of consumer purchasing power and confidence. So, a slight improvement
expected in Europe going forward.
Regarding Foods, we have, of course, been very active communicating the transaction
internally to our employees. I was recently in Netherlands having a Town Hall with all
our employees there in the central Foods team and talking to the whole Foods team
across the globe. I believe there is some real excitement about the potential that the
McCormick transaction offer for our people. It was very clear that Foods was not a key
priority in terms of portfolio development within Unilever. But Knorr will be the number
one brand in the enlarged McCormick, and Hellmann's will be the number two brand in
the enlarged McCormick. So, the concept of building a real global flavour powerhouse
with significant revenue synergies, in what I call a growth separation of Foods, I believe
it resonated with our people. Of course, there is some anxiety, and we are working very
aligned with McCormick to ensure that we shorten time frames in every single work
41
Unilever
Q1 2026 Trading Statement
stream. We are working very collaboratively with the McCormick leadership team.
Separation work streams are all in motion. And the integration plan with McCormick is
being managed in conjunction between the two companies. This week, the McCormick
Leadership Team is here in Europe. We have been talking to them. They have been
presenting to some of you, I believe also and we are very, very happy with the progress
that we are doing, and the intention is to shorten our timings as much as we can.
JEMMA SPALTON:
Our final question comes from Ed at Rothschild. Go ahead, Ed.
ED LEWIS:
Yes, thanks very much. A couple of ones, just looking at the Asia-Pac and LATAM, you
referenced Beauty and Wellbeing, strong performance in LATAM, also Beauty &
Wellbeing driving growth in China. Just trying to understand what parts of the Beauty &
Wellbeing are growing there. Is it the more premium sides of the business? Is it largely
online led? Just to understand how you're positioned there. And then as we think about
a period of more macro uncertainty, how should we think about the One Unilever
markets in that context? Do you feel more confident about being able to navigate
potential uncertainty or macro uncertainty given the way you now run those One
Unilever markets?
FERNANDO FERNANDEZ:
Yeah. Thank you, Ed. Yeah, performance in Beauty & Wellbeing in emerging markets has
been strong. As I mentioned before, our Hair business grew high single digits at total
level, and that was driven by a strong performance in emerging markets. India grew 8%.
I feel in Latin America, Beauty & Wellbeing was, I believe, in double-digit growth. We are
seeing strong growth also in Middle East and in some other Southeast Asia. So I feel the
performance has been strong. We have an excellent performance of Dove Hair. Dove
Hair is growing 15%. It initiated with the relaunch in the US that is performing extremely
well, but now this relaunch is rolled out across all our geographies. Vaseline growing
42
Unilever
Q1 2026 Trading Statement
very, very strongly, close to 10%, and Sunsilk growing 8% in Beauty & Wellbeing. So if you
look at the top three brands of our Beauty and Wellbeing business, Dove Hair 15%,
Vaseline 9%, if I'm not wrong, and Sunsilk 8%. So performance is strong. It's strong in
different price points, particularly in the upper mass to premium segment. But also, as I
mentioned before, our Prestige business in the US also doing very, very well. So overall,
good performance in Beauty & Wellbeing, particularly in emerging markets.
Regarding One Unilever markets, we are very happy with the performance there. It has
been one of our fastest growing cluster last year. Performance in quarter one continues
being strong. We are running in One Unilever markets a much tighter portfolio. Usually,
in every market in what we call One Unilever, that are markets 25 onwards, we run a
portfolio between six and eight brands and in the quarter one, we deliver above 2%
volume once again. So we believe that it could be, as I mentioned before, opportunities
for us in these markets. When there are supply constraints in the market, there are two
things that happen. A resilient supply chain, like the one of Unilever, can build some
competitive advantage to drive more volume, and second, the ability to pass pricing is
higher.
JEMMA SPALTON:
Thank you very much.
FERNANDO FERNANDEZ:
Good. I would like to close with a couple of messages. The first one is that we started
the year, as I mentioned, with a strong volume growth, and our confidence in delivering
above 2% volume growth for the year is reinforced by the fact that we are having a
strong start to quarter two with practically April finished now. Pricing will definitely
accelerate along the year. The majority of our cost inflation is in Home Care and is in
emerging markets, and the frequency of pricing and the ability to pass pricing in these
regions is higher. The cost environment is volatile, but we will manage the business with
clear focus on volume and ensuring competitiveness in both price and BMI and as I
43
Unilever
Q1 2026 Trading Statement
mentioned before, we will emphasize the driver of demand with the highest return
depending on the environment. We are really making good progress regarding the
Food separation. Of course, there are elements that are not completely in our control,
like the antitrust clearance, the timing of the antitrust clearance, and the timing of the
SEC approval. But all the work streams are in motion. We are working as one team with
the McCormick leadership team, and we expect to really accelerate the timing of
separation and integration, and we are reaffirming our guidance. We continue
expecting our top line to grow within the range of 4 to 6%, most probably at the bottom
end of that range, and we expect, despite the increase in commodity inflation that we
expect hitting our P&L in the second half of the year, to deliver modest operating
margin expansion. We will use every single level of the P&L, from formulation flexibility
to productivity, to hiring freeze, to tighter overheads management to ensure that we
are able to deliver the modest operating margin expansion that is in our guidance. With
that, thank you very much.
44
