Unilever PLC

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Earnings Call Transcript 2018-Q3

[Operator]

We're about to hand over to Unilever to begin the conference call. [Operator Instructions] We will now hand over to Richard Williams.

[Richard Williams, Investor Relations Officer]

Good morning, and a warm welcome to Unilever's Third Quarter Trading Update. As usual, we'll review the results and have Q&A, and aim to wrap up in about 40 minutes.Graeme will talk about market context, more detail on the highlights of our performance and the growth by divisions. I will then cover the regional performances, and Graeme will wrap up with the outlook for the year as a whole.But first, let me draw your attention to the usual disclaimer relating to forward-looking statements and non-GAAP measures.And now, I'd like to hand over to Graeme.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Thanks, Richard. Good morning, everybody. It's very nice to be talking again once more about the thing that's really most important to all of us, which is our business performance. But before I do that, let me just say a few words on simplification.Over the past few months, we had a really very rich and fulsome period of engagement with our shareholders, discussing and listening to views on the simplification proposals. Now we're disappointed about the outcome, but encouraged that we had strong endorsements for the strategic objectives of unification despite there being challenges around the mechanics. The board will now consider its next steps, and we'll, of course, continue to engage with shareholders. And we've already confirmed that we'll proceed with a plan to cancel the high-voting N.V. preference shares, further strengthening our corporate governance.And with that, let's talk about Unilever's performance in Q3. It's been a good quarter that some of you've already picked up today. We had balanced price and volume, emerging markets were strong and growth stepped up in all 3 of our divisions. We remain on track for our full year guidance and, indeed, our 2020 goals.Let's briefly review the market context. As we've pointed out before, with the shifting channel landscape, it's becoming increasingly difficult to measure total market growth with accuracy, but we think the markets in which we operate have picked up a little in the last few months with improvements in most regions. As expected, this pickup has been largely down to price with the return of commodity inflation and the strengthening of the U.S. dollar against local currencies.Now we're always prepared for currency volatility. It's simply part of operating big businesses in other parts of the world. However, devaluation leads to inflation, and that can dampen consumer demand.Nevertheless, global market volumes have remained robust in aggregate, up around 1%, but with some significant bright spots. In particular, India market growth remains strong. And in China, while e-commerce continues to be the key driver of market growth, the offline channel recovery has been sustained.Across Southeast Asia, the pickup in pricing has helped overall market growth. And Indonesia, which has been weak for some time, is starting to show some early signs of recovery.In the developed markets, we've seen a slight acceleration in market growth in the last quarter, although the retail environment in Europe remains just as tough as ever. In Brazil, which has been a challenging market for some time now, pricing has started to normalize, whilst market volume is slightly down.Very high inflation in Argentina has severely impacted consumer demand. Our local teams in both of these markets are very skilled at dealing with economic crisis and weaknesses. And as you know, we usually come out of difficult economies stronger.In our preparation for this Q3 trading update, we realized that there are a lot of moving parts, such as hurricanes in the comparator, the Brazil's trucker strike, and Indian sales taxes to name just a few. However, there is only one of these that I would like to bring to your attention, which is that we have removed price growth in Argentina from our headline USG number. That price growth was 34% in Argentina in Q3.USG will still include volume for Argentina, which was negative 10% this quarter. This adjustment for Argentina takes overall reported USG down by 70 basis points from 4.5% to the 3.8%, which you see here. Richard will explain more later when we talk about Latin America. But stepping back, it's been a strong quarter overall, so let's have a little look at the detail.In aggregate, underlying sales grew by 3.8% in the third quarter, with volumes up by 2.4%. Growth was high quality, with an acceleration across all divisions and regions compared with previous quarters. We increased prices in response to commodity inflation and currency devaluation, and it's a good sign of the fundamental strength of our brands and our brand investment that strong volume has continued as we've priced.In emerging markets, growth accelerated to 5.6%, and we have maintained good volume growth at 3.4%, which is very encouraging. The strongest performances in the emerging markets were in India and in Turkey, both growing with near double-digit volume in the quarter.In the developed markets, growth was 1.3%. As expected, we saw a recovery in North America following a weaker first half. Whilst in Europe, a combination of good weather, strong execution and strong innovation helped the ice cream business to continue its growth.The actions we are taking to evolve our portfolio and build our presence in new channels are working. We've so far launched 10 new brands this year, and our e-commerce business is growing at 50% year-to-date.Of course, there are challenges. For example, currencies and rising commodity cost, which put pressure on gross margins, high competitive intensity in some sales and the shifting retail channel landscape, particularly in Europe and in North America.Let me turn now to our performance by division. Starting with Beauty & Personal Care. Beauty & Personal Care grew by 4% in the third quarter with 2.8% from volume. Price growth has stepped up in response to increasing commodity prices, in particular, crude oil and chemicals.We saw good growth from the core and our new brands. The good momentum in skin care continued across Pond's and Vaseline. And in skin cleansing, Lux and the premium mousse formats in Dove continued to do well. Dove is, in fact, growing over 7% year-to-date, and Pond's is back to mid-single-digit growth after a long spell of subdued performance.The new Dove Self-Esteem campaign, which leverages mainstream entertainment with Cartoon Network, is landing very well, and Dove was recently accredited by PETA as a cruelty-free brand.Deodorants also had a much stronger quarter, helped by a recovery in Brazil and purpose-led campaigns from Rexona and Dove Men+Care.Our Prestige unit grew by double digits, with strong performances on all brands, including a recovery in Murad. Hourglass, which is our most recent Prestige acquisition, is growing at nearly 40% and came into our growth numbers from August. Hourglass is not only a fast-growing business, but it's also bringing purpose to Prestige Beauty through its commitment to being entirely vegan by 2020.Love, Beauty & Planet was one of the new brands that we launched in the U.S. 9 months ago. Moving with a lot of speed, it's already in 8 markets across North America and Europe and has been extended from here in skin cleansing into skin care and deodorants this quarter. With its use of recycled plastic and vegan skin care, it's a very good example of how we're evolving our brand portfolio.Under Connected 4 Growth, we continue to have stronger local innovations, such as St. Ives face masks in the U.S. and Axe Ticket, which is a deodorant format expansion in India.Turning to Home Care. Home Care grew by 4.5% in Q3, with an acceleration of pricing to 3% and a pickup in Brazil following the truckers' strike of last quarter.In South Asia, we see consumer up-trading, and very strong growth in home and hygiene, in particular from hand dishwash Vim bars, where the new Vim anti-smell bar with extracts of mint has been developed locally and delivered to the market in less than 6 months.In fabric solutions, which is cleaning, growth was driven by strong performance of liquids in emerging markets. In fabric sensations, which is more conditioning, China is now our biggest country, and our locally relevant innovations drive market development in both the online and the offline channels. Comfort Perfume Deluxe is seeing success in both developed and developing markets.In Europe, our launch of liquid concentrate, Dirt is Good, continues with a modernized pack design, which reduces our waste impact by 1/3. The dry wash category has launched in the U.K. with Day2. Day2 is a new brand. It's a light aerosol mist that refreshes and resets your clothes to just-washed, so that you can wear your clothes for another day with confidence.Food & Refreshment grew by 3.2% in the quarter. Ice cream was the main driver, helped by good weather in Northern Europe, but also reflecting the overall strengths of our innovation and our execution in ice cream. Kinder ice creams have been a big success in France and Germany, and Magnum Pints is now the #1 U.S. pint innovation for 2018.We continue to build our [ order form ] business through cabinet placement, retail stores and our new on-demand ice cream now business model, which enables consumers to order ice cream to their home exactly when they want it.Savoury delivered good performance in emerging market cooking products, but this was offset by slow growth in developed markets as the good weather impacted soups.New brands, such as Jawara, a chili sauce in Indonesia, and Red and Prepco in the U.K. are giving is entry into higher growth on-trend spaces. We had good growth from Brooke Bond tea in emerging markets, and the black tea segment continues to be difficult in the developed markets. The transformation of our tea portfolio is continuing with acquisitions like TAZO and Pukka, and on-trend innovations like our new[Audio Gap]

[Richard Williams, Investor Relations Officer]

The market remains very tough. Growth in Q3 was good, but the exclusion of Argentinian price, the successful completion of the spread sale and currency devaluation contributed to a turnover decline in the quarter of 4.8%. The currency impact of 5.2% is a result of the euro strengthening against almost all of our major emerging market currencies. If exchange rates were to stay as they are today, we would expect a full year drag on turnover of around 7% and a little more on EPS.And with that, I'll hand back to Graeme.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Thanks, Richard, and let me just try and summarize the regional picture a little bit. We're really very pleased that volume in emerging markets has remained strong, whilst their pricing has picked up. We expect a high contribution from price as commodities pick up and that volume will soften a little as higher prices impact short-term consumer demand.In North America, an improved Q3 is welcome, and we're pleased to see some growth in Europe where the strength of our innovation and supply network have ensured the good weather was converted into strong performance.For 2018, we expect full year underlying sales growth to be at the bottom end of our multiyear range of 3% to 5%, possibly even a little higher, with a nice balance of price and volume. This is, of course, made more difficult on a reported basis with the accounting changes in Argentina, but we expect to make it.Commodity inflation looks like it will be a stronger headwind for our sector for some time to come. Nevertheless, we continue to make steady progress towards our 2020 margin target and expect another year of strong cash flow.And with that, we'd be really happy to take your questions.

[Richard Williams, Investor Relations Officer]

Thank you, Graeme. [Operator Instructions]

[Richard Williams, Investor Relations Officer]

Okay. So we've got the first question from Alain Oberhuber from MainFirst. You want to go ahead, Alain?

[Alain-Sebastian Oberhuber]

I have one question, mainly, regarding the pricing. Could you give us a little bit of insight where you expect the pricing in different markets will mainly be? And then on the other side, where you expect the pricing in the different product segments, please?

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

So, yes, the price landscape, just to go through what's happening within markets, overall, I'll start with North America. I mean, Nielsen is showing growth, overall, of about 1% to 2%. We think that could be 2% to 3%, including non-tracked channels. The environment for pricing, as we said in the top, we stepped forward with pricing in Q3, but the environment remains a little bit tough and quite promotionally intense, especially in dressings. And then moving to Europe, whilst we've seen a little bit of price moving forward in some markets, for example, in The Netherlands and the U.K., it's a mixed picture. And as we said in the talk, especially in France, it's a very tough retail environment. But as we said, we had a bit of a boost from the good weather in the last 12 weeks. Moving to Latin America, we're starting to get pricing back in Brazil, and I think that's a very important factor for us. It was the first quarter out of the last 3 quarters where we were able to get some pricing back. So it remains tough in Brazil, starting to stabilize market volume. It's still negative 4%. Argentina, I won't say anything else about because of pricing we're taking out, but of course, the volume is still in there in the market. Volume decline in Argentina was negative 9%. We think, as we said, that will be a little bit worse before it gets better. And then we've got a nice steady balance, actually, in Mexico continuing to perform well. Our business there is growing sort of mid-single digits with a nice balance between price and volume. And then into Asia where, as we said, we've had very strong volume-driven performance even as we started to push pricing through. In India, I think there would definitely be an inflationary environment. The main driver is the shift in the appreciation of the U.S. dollar relative to a number of currencies. But there, we've been able to secure growth, which is largely volume-driven. I think that will rebalance between price and volume a little bit. And then across Southeast Asia, where, as we said, we started to see a nice balance of price and volume again in big markets like Indonesia. So it's a mixed picture. What I'd reemphasize, Alain, is the sort of Pareto of Unilever. The diversity of markets where we have strong businesses, the fact that we're very skilled in taking prices and managing periods of higher inflation through currency devaluation and commodity pickup, and that's evidenced, I think, as Richard said, by the very strong action that we've taken in Argentina, although that's a little bit of an extreme case.

[Richard Williams, Investor Relations Officer]

Okay. Thanks, Alain. Let's go to our second question, which is from Eileen Khoo at Morgan Stanley.

[Eileen Khoo, Equity Analyst]

Two questions from me. The first one is I know you said, Graeme, that it's getting increasingly difficult to estimate what your underlying markets are doing, overall. But I wonder if you'd be able to put a number on what you think the overall underlying growth has been now because you mentioned that it improved and then comment on how you see your own performance versus this? And then, secondly, in terms of brand launches, I think you recently mentioned that you have 12 new brands ready to go in the pipeline. Should we therefore expect the pace of new introductions to accelerate into the last quarter of this year?

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Eileen, thanks for the questions. So how to think about market growth, as Richard and I said, there's an awful lot of channel shift in our marketplace and in our sector, generally, and that does make it harder to get an accurate read on overall market growth. But the way we see it just now, we basically have a market which is growing a little bit north of 3%, with just above 1% of that in volume. Now set against that, how do we view the competitiveness of Unilever? Well, against the 3% market growth, we grew at 3.8% or 4.5% if you include the Argentinian price, which is actually, of course, recorded in the market growth number, albeit with a time delay. So we're definitely growing, in aggregate, faster than the rate of our market growth. And from a volume perspective, with volumes growing just north of 1%, Unilever's volumes are growing at 2.4%. So in aggregate, we think we're growing faster than our marketplace, but with a mixed picture, as we said. I mean, it's not all roses in North America in dressings. North America hair care continues to be a tough environment. We don't win everywhere, obviously, but when it comes to that basic question of how our market is growing and are we competitive within each channel, in aggregate and overall, stepping back from it, we think we're growing, as I said, a little bit above the market right now, certainly from a volume perspective, which is particularly pleasing with the level of pricing that's -- that we've put through in the third quarter and expect to put through into 2019. Moving to your question about new brands. Yes, we've actually launched, I think, 17 new brands since the beginning of 2017 and 10 new brands so far this year. It's quite a distinctive change, really, when you look historically, perhaps. We've launched 1 or 2 new brands over the last decade or so. Really, this is all about the ability to enter new consumer spaces with brands, with models that are flexible, relatively a lot of packaging, which is in itself part of the brand communication message. Brands being built and awareness of the brand being built largely through social campaigns and social media campaigns. The brands tend to be in sectors, certainly, in Personal Care, which are quite premium. And that means there's quite a high retailer margin attached to it, which means that we're able to put a brand in which is relatively self-sustaining from an individual product perspective. And it's quite important because, in the past, perhaps, you would move, take one of your existing brands and launch it in a brand-new whitespace market, that would require an awful lot of investment. In order to build awareness of the brand, you would make period of losses for, perhaps, several years until the brand had established a scale position. This is quite a different and very complementary way of addressing new consumer needs spaces. Sometimes we acquire brands and sometimes it's better just to create the brand internally with that particular piece of consumer insights. But brands like -- I mean, just this year, K-Bright, which has been launched in Southeast Asia, which is focused on Korean beauty; Prepco and Red, which we mentioned in the speech, which are in the U.K., which are snacks pots; Jawara, which is the chili sauce that I mentioned we've now launched in Indonesia; Day2, which we mentioned; Del Huerto, which Richard mentioned, which is a Tier 3 brand in laundry in Latin America. We're moving quickly. This is the benefit of Connected 4 Growth. Our businesses on the ground have got the equipment now and the freedom to enable them to launch brands at speed if they see an area of consumer growth and consumer demand, which is interesting, too. And I think that's absolutely essential going forward to maximize the growth opportunity that we have in our markets.

[Richard Williams, Investor Relations Officer]

Okay. Thanks, Eileen for the question. The next one comes from Martin Deboo at Jefferies. You're on, Martin.

[Martin John Deboo, Equity Analyst]

Two from me, please. First one is on commodities. Can you just update us how you're seeing the landscape? I mean, the last thing I remember you saying was you saw mid- to high single-digit inflation in H2. Have I understood that correctly and any change? Second one is, can you update us on Dollar Shave, how is that going, particularly how is the U.K. rollout going? Those are the 2.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Well, on commodities, yes, in the first half, we had, in local currencies, commodity costs were going up sort of low to high -- sorry, low to mid-single digits. And most of the inflation that we saw was driven by material inflation in the first half. And the currency impact was actually quite small because it was quite a bit of USD weakness. What's changed in the second half and going forward into 2019, Martin, is the step-up in the impact of a stronger U.S. dollar against most currencies. That's really the key feature. And, yes, we think that, that will carry on for quite some time. We've also got higher inflation on base commodities, especially in crude and in chemicals. So we do see that we'll be closer to the mid-single digits going forward across the commodity portfolio, driven principally by a stronger U.S. dollar, but also with more fundamental increases in things like the crude price. On Dollar Shave Club, the business, in general and in totality, continues to perform quite nicely for us. We had about 10% growth in the business in the year-to-date. We've particularly continued to grow the number of new subscribers that are coming into the business, albeit that, that started to come in at a slightly lower rate. But the new subscribers are now sitting at about 3.9 million. On the U.K. launch, in particular, we launched that in January 2018. That is off to a good start, but it's definitely going to take some time to scale. And you can see the activity had a lot of advertising in the marketplace right now behind Gillette. And you see a lot of activity from alternative models, such as Harry's, et cetera. So a good start, but it's going to take time to scale that up. What we're doing in the business more fundamentally is moving to a more flexible business model where it's easier for the subscribers, the Dollar Shave Club, to have more control over the basket size. It's easier for them to add non-razor products into their mix and to really appreciate, whilst they're getting the online experience, the degree of value that's being afforded to them as they add items to their basket. So we're trying to drive up basket size, and we're trying to drive up the frequency of purchases. That means it meant a fairly fundamental rewrite of the data management platform for Dollar Shave Club and quite a different business model for it. So -- and of course, a new campaign. I don't know if you've had a chance to look at it, it's been out on YouTube. But that targets a very broad range of users, and it's actually, I think, building the brand in a very, very nice way. It's a nice movie to watch.

[Richard Williams, Investor Relations Officer]

Okay. Our next question is from Celine Pannuti at JPMorgan. Go ahead, Celine.

[Celine A.H. Pannuti]

Yes. So my first question, I would like to come back on what you said on volumes and the balance of pricing and volume. So you said that the volume is around 1%-plus globally. So how do you expect this volume component to move forward as you are going to press on with pricing? If you could talk a bit about this elasticity, how we should look at that, especially, I think, Q4 is a tougher comparative, but probably more broadly to 2019. And if you could also comment why U.S. volume have been, what I would call, softer despite quite an easy comp last year. Then my second question, I would like to rebound on your commentary. So you talked about higher inflation and the challenges that you're facing with FX. Are you still expecting gross margin to be up for the year? And are you still happy with consensus expectation for the total margin?

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Okay. Celine, thanks for the questions. First, on the price-volume balance. We expect that we'll get a helping hand on fourth quarter growth through a further acceleration in pricing as commodities do pick up across our business. We also get a couple of months of growth in Carver Korea, the acquisition starts to pull into the fourth quarter. And indeed a couple of weeks ago from Shea Moisture, it's only a couple of weeks and it's not a huge business, but we get a benefit from that nonetheless. And we do think that, that will be offset by some softer volumes as those rising commodities and the pricing associated with that starts to weigh a little bit on consumer demand. So I think we've been in that moment where, although we're very pleased with the strong volume performance that we had, whilst stepping up pricing, as expected in Q3, we do think with the higher levels of pricing that are going to be required, we will see a rebalancing towards more price and a little less volume going forward. But that's why we're organized the way we are. That's why we have strong local teams in place to make that sort of very important and magical balance between price and volume, market-by-market, making sure we've got the brand portfolio to appeal to a hard-pressed consumer if the consumer needs to downtrade and concentrate on value for a period of time. So we're entering another one of those periods where it will be more price and a little less volume, and we'll be watching the volume line very, very closely as we normally do as a means of thinking of are we making the right decisions. And on the gross margin, I don't -- I obviously don't want to talk about much on margin this quarter because it's just a trading update. But to reiterate, I mean, we were really pleased with our margin progression in the first half, principally because of the high quality behind it when we went forward with 60 basis points of gross margin as part of an 80-basis-point improvement in underlying operating margin, that gives us a very strong base for the balance of the year. There are factors that are going to weigh on margin across the industry, such as commodity inflation, of course. You feel the inflation before you're able to land the price. I mean, we tend to be leaders on price, but there's obviously a lag, and that is a -- can put a little bit of pressure on gross margin, and we'll need to watch that very, very carefully. But I do think that what we've delivered in the first half gives us a strong base for the balance of the year. And without saying too much, I think we should do okay there.

[Richard Williams, Investor Relations Officer]

Okay. Thank you. Our next question is from Jeff Stent at Exane.

[Jeffrey Patrick Stent, Research Analyst]

You've previously commented that all the portfolio changes would add about 100 basis points to group growth. So with that in mind, I wonder if you could just quantify on a continuing business basis what like-for-like growth would have been in the quarter.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

The -- so 2019, Jeff, we said we thought that everything we have done to-date would give us about 100 basis points tailwind coming out of 2019. However, those acquisitions doing relative to the expectations we had when we made that comment. Everything, with the exception of Blueair, is collectively growing at double digits. And so that -- if you go down the individual acquisitions, those assumptions still remain robust. Blueair is, however, declining by strong double digits. And as we head into '19, that's going to present something of a challenge. We expect, as we start to annualize the drop-off in Blueair and some other challenges we had in one of our acquisitions, in particular in Prestige, which was Murad, we'll start to lap the drop-off from coming out of the infomercial channel from Murad and we start to annualize the drop in Blueair itself. And we'll also get some benefit on top from selective geographic expansion. So it's a change in mix, as you would expect. But really, the only one of those acquisitions, which we've got work to do on, is Blueair during the course of 2019.

[Richard Williams, Investor Relations Officer]

Okay. Thanks, Jeff. I've got a question from John Ennis at Goldman Sachs.

[John Mark Ennis, Equity Analyst]

A follow-up for me, actually, on the commodities comments you made. I wondered if you could tell us when you think you would have fully offset the mid-single-digit inflation through pricing. And then, in general, I wondered if you could comment and let us know how you're seeing competitors act? Are they acting in a similar fashion with price? Or are you seeing some differences between the multinationals and, say, some of your local competitors?

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Well, absolutely difficult question to answer your first one because it's a real crystal-ball question. But what we do is we are, of course -- one of the tools you need in order to deal with an environment like this effectively, first of all, you need really strong brands. I mean, the power of the brand is an inflation protection. The reason why we spend $7.5 billion of brand and marketing investment every year behind the brands is exactly for times like this because it's strong brand equities that allow you to price if you choose to price or, indeed, you could choose not to price and win a little bit of market share over the period giving you a broader base and stronger brand proposition for the future. So there's many choices that you can make. Now we delegate those choices down to the front line of our business. But we are, as I said in response to Celine's question, always very cautious about the balance between price and volume. And whilst you are looking at price, by the way, the second tool you need on price is the ability to have a lot of visibility about what your pricing is going to be. And our supply chain around the world, our procurement organization, the way that we hedge some commodities going forward, getting a view on currency, et cetera, all of those things are really important to give the front line of our business clear information that allows them to act decisively in markets where, typically, as I said, we are the market leader. You can get a difference between multinational behavior and local company behavior. And I think it's no secret that a lot of local businesses can be privately-owned. They maybe are happy to operate with a lower level of profitability for a period of time. And it's exactly the same set of choices that we face. They may choose more often, perhaps, to build their brand, hold pricing a little bit more competitively and choose to gain a little bit of market share and build their brand through that period. Typically, they've got smaller brands than we have, and that's a perfectly rationale thing to do. But it's not really a new phenomenon. If you think back to how long we've been in key markets, like Pakistan, Indonesia, India, most of the competition we face is a combination of multinationals and local competition. So it's not really as if there's a whole slew of arrival there. The real dynamic in local competition is when new brands enter to find a new consumer space moving very quickly, leveraging social media, perhaps social commerce to build the brand. So the real local phenomenon is the speed with which brands can be established in response to fast-changing consumer expectations. It's not necessarily that our local brand behaves fundamentally differently when it comes down to basic economics, like devaluing exchange rate and increased commodity inflation.

[Richard Williams, Investor Relations Officer]

Okay. Thank you. Well, we have no more questions, and we said we'd try and wrap up in 40 minutes, and I think we just squeaked in.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Sorry to answer all the questions, I should have put some over to you.

[Richard Williams, Investor Relations Officer]

No, they are very well answered, Graeme. We'll bring the call to a close. If you do have any other further questions, and I'm sure you probably will think of some, then Laura, Becky and I will be back at our desks, and just give us a call at any point during the day. So enjoy the rest of the day, and thank you.

[Graeme David Pitkethly, Chief Financial Officer and Executive Director]

Thanks, everybody. Have a good day.

[Operator]

This conference has been recorded. Details of the replay can be found on Unilever's website and will be available shortly. Thank you.