Unilever eyes higher return on investment; on track for Ice Cream exit

Unilever announced on Friday an upgraded target for return on capital, reaffirming its progress toward meeting strategic goals and cost savings targets by the end of 2025.

Unilever eyes higher return on investment; on track for Ice Cream exit

At an Investor Event, the London-based consumer goods company, which owns brands such as Marmite and Domestos, confirmed it remains on track to achieve its €800 million productivity program and complete the separation of its Ice Cream division by the end of 2025. Post-separation, the company will focus on four core business areas: Beauty & Wellbeing, Personal Care, Home Care, and Foods (formerly Nutrition). These segments will be driven by 30 "Power Brands" and operate in 24 key markets, which collectively account for nearly 85% of Unilever's turnover. The remaining 100-plus smaller markets will follow a "One Unilever" model to maximize scale and efficiency. Unilever maintained its medium-term guidance. After the Ice Cream business separation, it targets mid-single-digit underlying sales growth, underpinned by at least 2% underlying volume growth. The company also anticipates a modest improvement in its underlying operating margin, driven by gross margin expansion through productivity gains and operational efficiency.

Unilever raises its goal for return on invested capital

Unilever has raised its goal for return on invested capital to the high teens, exceeding its previous mid-teens target. It also aims to sustain an average cash conversion ratio of approximately 100% over time, while striving for top-third total shareholder return within its peer group. The company emphasized disciplined capital allocation to drive value creation. This includes investments to fuel growth and productivity, portfolio optimization through strategic acquisitions and divestitures, and delivering attractive returns to shareholders. Chief Executive Hein Schumacher stated, “Our goal is to achieve best-in-class performance with market-leading, unmistakably superior brands. We are confident that our Growth Action Plan 2030 will enable us to deliver on this ambition.”