Haleon Plc Q1 FY2025 earnings call

• Good start to the year with 3.5% organic revenue growth despite challenging market. • Emerging markets, especially India and China, performed well with double-digit growth in Sensodyne. • Successful launches including Voltaren 2% strength in China, Sensodyne clinical platform range expansion, and Otrivin Nasal Mist in markets. • Full year guidance unchanged at 4%-6% organic revenue growth with organic profit ahead. • Innovation continues with multiple successful product launches during the quarter.

Oral Health: Revenue grew 6.6%, driven by Sensodyne and Parodontax. VMS: Revenues grew 0.9%, with growth in Asia Pacific, EMEA, LatAm but decline in North America. OTC pain relief: Grew 2.6% with Advil and Voltaren. Respiratory Health: Up 1.7%, strong in U.S. but weaker elsewhere. Digestive Health and Other: Up 3% due to Tums and ENO innovation but softness in smoker's health and Nexium. Regional: North America organic revenue grew 1%, Europe, Middle East, Africa and Latin America up 5%, Asia Pacific up 4.2%.

• Full year organic revenue growth expected to be 4% to 6% with organic profit ahead. • FX impact on revenue and profit in Q1 was in line with expectation, and impact for 2025 based on Bloomberg consensus rates is included in guidance. • Tariffs impact on business is limited and built into guidance. • Q2 expected to be broadly similar to Q1, with confidence in second half due to innovation, investment levels, and expected normal cold/flu season and government stimulus in India.

• Macroeconomic backdrop remains volatile. • Currency fluctuations, such as sterling strength impacting reported revenue. • Tariffs impact, with potential limited impact but factored into guidance. • U.S. retail inventory management challenges and consumer caution affecting sales. • Competitive promotional activities affecting pricing and sales in some categories.

Q: Any surprises in Q1, especially in March, and outlook for the year?

A: Respiratory in U.S. ended quarter strong but soft in other regions. Outlook for year remains confident in 4%-6% growth with second half stronger due to innovation, investment, and expected normal season/geographic stimulus.

Q: Detail on consumption habits change in U.S. and impact of tariffs?

A: U.S. consumer confidence soft, retailers aligned inventory with consumption. Tariffs impact is low tens of millions, built into guidance, with limited impact from China.

Q: Visibility on U.S. retail inventory and VMS performance in U.S.?

A: Good visibility with Top 10 retailers, inventory flat at end of quarter. VMS in U.S. saw softness but Centrum has global strength with tailored products.

Q: Balance of volume, mix, pricing and EMEA/LatAm performance?

A: Expect balanced price volume mix, EMEA and LatAm performing well with LatAm high single digit and EMEA mid-single digit.

Q: Inventory levels, M&A, and Ericsson trend?

A: Confident in inventory levels, M&A environment soft but focused on portfolio optimization, Ericsson performance challenging with lockbox and online impacts.

Q: Phasing in full year and M&A opportunity?

A: Confident in second half due to innovation, investment, and season/geographic factors. M&A environment soft but focused on portfolio optimization.

Q: Greenfield introductions and future growth?

A: Significant headroom in consumer health from incident vs treatment gap, penetration opportunity, and premiumization, with details to be shared at Capital Markets Day.