Q4 2026 PZ Cussons PLC Earnings Call

August 6, 2026

Speaker #1: This is Hay. How can I ask him for the PZ Cussons full-year results call? The call will begin in approximately 1 minute. Thank you for your patience.

Speaker #1: Good morning, or good afternoon, and welcome to today's PZ Cussons full-year results call. My name is Adam, and I'll be your operator for today.

Operator: Good morning or good afternoon all, welcome to today's PZ Cussons Full Year Results Call. My name is Adam, and I will be your operator for today. If you would like to ask a question at the Q&A portion of today's call, please dial in and press star one on your telephone keypad. I will now hand the floor to Jonathan Myers to begin.

Speaker #1: If you'd like to ask a question during the Q&A portion of today's call, please dial in and press star 1 on your telephone keypad.

Speaker #1: And I will now hand the floor to Jonathan Myers to begin.

Speaker #2: Thank you, Adam. Good morning, and thank you to all of you for calling in to our results presentation for PZ Cussons’ financial year ended 31st May 2026.

Jonathan Myers: Thank you, Adam, good morning, and thank you to all of you for calling in to our results presentation for PZ Cussons' financial year ended 31 May 2026. For those of you viewing the slides as we are presenting this morning, you can see straight away an example of how we built stronger brands last year. Here is us making a splash on Marble Arch about Original Source's tie-up with HYROX. The London leg of this global indoor fitness competition was a perfect opportunity to promote our latest innovation, the Men's Workout Recovery range. Not only were we able to distribute tens of thousands of product samples at the event, we were also able to generate more than 16 million views online. Turning to the agenda for this morning then. I will start with a brief introduction before handing over to Jan.

Speaker #2: For those of you viewing the slides as we're presenting this morning, you can see straight away an example of how we built stronger brands last year.

Speaker #2: Here's us making a splash at Marble Arch about original sources' tie-up with Hyrules. The London leg of this global indoor fitness competition was a perfect opportunity to promote our latest innovation, the men's workout recovery range.

Speaker #2: Not only were we able to distribute tens of thousands of product samples at the event, we were also able to generate more than 16 million views online.

Speaker #2: Turning to the agenda for this morning, then—I'll start with a brief introduction before handing over to Jan. Some of you will have met Jan already, since she joined four months ago.

Jonathan Myers: Some of you will have met Jan already since she joined four months ago, and she will share some reflections from her fresh eyes before getting into an update on our financial performance. I will then provide a broader update on strategic progress before a chance for you to ask any questions. Without further ado, let's get started. There is no better place to start than a reminder of the investment case we set out at our capital markets event back in February. We have winning portfolios of locally loved brands. They play in our three core categories and our four lead markets. These brands are supported by two other attributes which we also see as a source of competitive advantage, our go-to-market capabilities and our manufacturing scale and agility. Our portfolio is well-balanced, with each lead market playing its own role in delivering for the group overall.

Speaker #2: And she'll share some reflections from her fresh eyes before getting into an update on our financial performance. I'll then provide a broader update on strategic progress before a chance for you to ask any questions.

Speaker #2: So, without further ado, let's get started. There's no better place to begin than with a reminder of the investment case we set out at our Capital Markets event back in February.

Speaker #2: We have winning portfolios of locally loved brands. They play in our three core categories and our four lead markets. These brands are supported by two other attributes, which we also see as sources of competitive advantage.

Speaker #2: Our go-to-market capabilities, and our manufacturing scale and agility, position us well. Our portfolio is well balanced, with each lead market playing its own role in delivering for the group overall.

Speaker #2: As Jan will cover, our balance sheet has been significantly strengthened, and we have set out a clear capital allocation policy. Overall, this gives us confidence in our growth ambition and target of double-digit total shareholder return through the cycle.

Jonathan Myers: As Jan will cover, our balance sheet has been significantly strengthened, and we have set out a clear capital allocation policy. Overall, this gives us confidence in our growth ambition and target of double-digit total shareholder return through the cycle. Put all of this together, along with the actions taken following our strategic review, we are now a more focused and more resilient business. What of FY26 then, as we look through the lenses of this investment case and our refreshed strategy? Well, overall, we have seen some early signs of delivery. Performance was broad-based, with growth across all four lead markets and our top 10 brands.

Jonathan Myers: As Jan will cover, our balance sheet has been significantly strengthened, and we have set out a clear capital allocation policy. Overall, this gives us confidence in our growth ambition and target of double-digit total shareholder return through the cycle. Put all of this together, along with the actions taken following our strategic review, we are now a more focused and more resilient business. What of FY 2026 then, as we look through the lenses of this investment case and our refreshed strategy? Well, overall, we have seen some early signs of delivery. Performance was broad-based, with growth across all four lead markets and our top 10 brands.

Speaker #2: But all of this together, along with the actions taken following our strategic review, means we are now a more focused and more resilient business.

Speaker #2: So what are the FY26, then, as we look through the lenses of this investment case and our refreshed strategy? Well, overall, we've seen some early signs of delivery.

Speaker #2: Performance was broad-based, with growth across all four lead markets and our top ten brands. Our ability to step up investment in brand-building activity, to the highest level in recent years, is paying off—supporting growth across the portfolio and enabling us to invest in the development of future innovation and activation plans as we build multi-year growth plans.

Jonathan Myers: Our ability to step up investment in brand-building activity to the highest level in recent years is paying off, supporting growth across the portfolio and enabling us to invest in the development of future innovation and activation plans as we build multi-year growth plans. We have seen a continued reduction in FX risk in Nigeria as our actions have materially reduced sensitivity to future currency fluctuations, along with the ongoing implementation of guardrails that we set out in February. We have a significantly strengthened balance sheet, not least thanks to growth of GBP 12 million in free cash flow. As a result, the board is proposing the resumption of dividend growth, the first increase in four years. Like all companies in our sector, we are of course mindful of the macroeconomic environment in which we're operating.

Speaker #2: We have seen a continued reduction in FX risk in Nigeria, as our actions have materially reduced sensitivity to future currency fluctuations, along with the ongoing implementation of guardrails that we set out in February.

Speaker #2: And we have a significantly strengthened balance sheet, not least thanks to growth of 12 million pounds in free cash flow. As a result, the board is proposing that resumption of dividend growth, the first increase in 4 years.

Speaker #2: Like all companies in our sector, we are, of course, mindful of the macroeconomic environment in which we're operating. However, we have started the year in line with our expectations and are pleased to confirm that the outlook for FY27 is in line with market expectations.

Jonathan Myers: Like all companies in our sector, we are of course mindful of the macroeconomic environment in which we're operating. However, we have started the year in line with our expectations and are pleased to confirm that the outlook for FY 2027 is in line with market expectations. We remain confident that we are well-placed to continue delivering sustainable growth over the long term. Now, with that, I'll hand over to Jan.

Jonathan Myers: However, we have started the year in line with our expectations and are pleased to confirm that the outlook for FY27 is in line with market expectations. We remain confident that we are well-placed to continue delivering sustainable growth over the long term. Now, with that, I'll hand over to Jan.

Speaker #2: We remain confident that we are well placed to continue delivering sustainable growth over the long term. Now, with that, I'll hand over to Jan.

Speaker #3: Thanks, Jonathan. Good morning, everyone. It's great to be here, presenting my first set of results at PZ Cussons, and I look forward to seeing some of you in person during the roadshow over the coming weeks.

Jan Bramall: Thanks, Jonathan. Good morning, everyone. It's great to be here presenting my first set of results at PZ Cussons, and I look forward to seeing some of you in person on the roadshow over the coming weeks. For those I haven't met yet, I joined PZ in late March from Severfield, where I was the interim chief finance officer. Before that, I was the CFO at Manchester Airports Group for more than five years. During this period, I oversaw the delivery of major investments and transformation projects, such as Manchester's GBP 1.3 billion investment in Terminal 2, as well as operational efficiencies, technology advancements, and finance transformation. I also led the refinancing and operational response as we navigated through the COVID pandemic, as passengers fell from 60 million down to zero and then back up to 60 million.

Speaker #3: For those I haven't met yet, I joined PZ in late March from Sevrefield, where I was the interim Chief Finance Officer. Before that, I was the CFO at Manchester Airport Group for more than five years.

Speaker #3: During this period, I oversaw the delivery of major investments and transformation projects, such as Manchester's £1.3 billion investment in Terminal 2, as well as operational efficiencies, technology advancements, and finance transformation.

Speaker #3: I also led the refinancing and operational response as we navigated through the COVID pandemic, as passengers fell from 60 million down to 0 and then back up to 60 million.

Speaker #3: Prior to that, I held a number of senior commercial finance roles in global businesses, across Europe and the US. Having started my career qualifying with PWC, where I worked in corporate finance in M&A lead advisory.

Jan Bramall: Prior to that, I held a number of senior commercial finance roles in global businesses across Europe and the US, having started my career qualifying with PwC, where I worked in corporate finance in M&A lead advisory. Before we get into the numbers, I thought it would be helpful to share some observations from my first few months in the role. Firstly, PZ Cussons is a brilliant company with a fantastic portfolio of locally loved brands, a number of which have long featured in my own household. I've loved meeting so many colleagues in my first few months, and it's clear that the business is full of brilliant people who are committed to the success of PZ and work hard every day to make it a reality.

Speaker #3: Before we get into the numbers, I thought it would be helpful to share some observations from my first few months in the role. Firstly, PZ Cussons is a brilliant company.

Speaker #3: With a fantastic portfolio of locally loved brands—some of which have long featured in my own household—I've loved meeting so many colleagues in my first few months, and it's clear that the business is full of brilliant people who are committed to the success of PZ and work hard every day to make it a reality.

Speaker #3: My first trip to Nigeria with Jonathan was in June, and it was brilliant to get under the skin of how the business and the market there work.

Jan Bramall: My first trip to Nigeria with Jonathan was in June, and it was brilliant to get under the skin of how the business and the market there works. Understanding the recent financial history of the business and how this was impacted by the devaluation has been top of my list since joining. I'm pleased to say that the guardrails that Jonathan and the team have been embedding have greatly reduced potential risk in the future. As I've learnt about the business, I see three areas where I want to focus and I feel I can make a difference. Firstly, in supporting the business as we increasingly focus not only on investing in current year brands, campaigns, and innovation, but also planning out over several years. This is largely about shifts in mindset and some of the principles of the longer term planning at the infrastructure companies I've worked at.

Speaker #3: Understanding the recent financial history of the business and how this was impacted by the devaluation has been top of my list since joining. I'm pleased to say that the guardrails that Jonathan and the team have been embedding have greatly reduced potential risk in the future.

Speaker #3: As I've learned about the business, I see three areas where I want to focus, and I feel I can make a difference. Firstly, in supporting the business as we increasingly focus not only on investing in current-year brands, campaigns, and innovation, but also planning out over several years.

Speaker #3: This is largely about shifts in mindset, and some of the principles of longer-term planning at the infrastructure companies I've worked at. Secondly, and related, is improving returns.

Jan Bramall: Secondly, and related, is improving returns. We have been clear with our shareholders what to expect in terms of the financial algorithm. To really drive this, I now want each and every one of our teams to understand the role they play in delivering on our commitments and what it means as they think about investment and required returns. Whether that's money spent on TV commercial, a new line in a factory, or an IT systems upgrade. We also need an eye on how that criteria needs to vary depending on the developed or the emerging markets, given the underlying differences in risk characteristics. Third, there are further opportunities for finance simplification. I'm a big user of AI myself, and I want the finance team to be embedding these tools into our everyday work in order to free up time to support with value-added decision-making.

Speaker #3: We have been clear with our shareholders about what to expect in terms of the financial algorithm. To really drive this, I now want each and every one of our teams to understand the role they play in delivering on our commitments, and what it means as they think about investment and required returns.

Speaker #3: Whether that's money spent on a TV commercial, a new line in a factory, or an IT systems upgrade. We also need an eye on how that criteria needs to vary depending on developed or emerging markets, given the underlying differences in risk characteristics.

Speaker #3: Third, there are further opportunities for finance simplification. As a big user of AI myself, I want the finance team to be embedding these tools into our everyday work in order to free up time to support with value-added decision-making.

Speaker #3: Now, let's move on to the numbers, where we've had a strong year financially. Starting with a summary financials. Group revenue increased by 5.4% to 541 million, with like-for-like revenue growth of 5.8%.

Jan Bramall: Now let's move on to the numbers, where we've had a strong year financially. Starting with the summary financials. Group revenue increased by 5.4% to GBP 541 million, with like-for-like revenue growth of 5.8%. That growth was broad-based, with growth across each of our four lead markets and across our top 10 brands in their respective largest markets. Adjusted operating profit increased to GBP 59.5 million, with the margin improving to 11%. On the more relevant comparison basis, which excludes the contribution from the PZ Wilmar joint venture in both years, adjusted operating profit increased by 24.5% and margin improved by 170 basis points. Moving further down the P&L, net finance expense reduced significantly, reflecting the strengthening of the balance sheet. Adjusted profit before tax increased to just over GBP 50 million, while adjusted earnings per share decreased to GBP 0.0714. This decrease is driven by two factors.

Speaker #3: That growth was broad-based, with growth across each of our 4 lead markets and across our top 10 brands in their respective largest markets. Adjusted operating profit increased to 59.5 million, with the margin improving to 11%.

Speaker #3: On the more relevant comparison basis, which excludes the contribution from the PZ Wilmar Joint Venture in both years, adjusted operating profit increased by 24.5%, and margin improved by 170 basis points.

Speaker #3: Moving further down the P&L, net finance expense reduced significantly, reflecting the strengthening of the balance sheet. Adjusted profit before tax increased to just over £50 million, while adjusted earnings per share decreased to 7.14 pence.

Speaker #3: This decrease is driven by two factors. Firstly, a high effective tax rate which, as explained at the half year, is due to the post-tax income from the PZ Wilmar Joint Venture no longer being recorded in our operating profit.

Jan Bramall: Firstly, a high effective tax rate, which as explained at the H1, is due to the post-tax income from PZ Wilmar joint venture no longer being recorded in our operating profit. Secondly, the mix of growth. With Africa's strong performance driving a proportionally higher minority interest charge, and in particular, as we saw strong growth in electricals in which we have a lower net ownership than elsewhere. Critically, free cash flow improved strongly to GBP 54.7 million, compared with GBP 42.3 million last year, reflecting higher adjusted operating profit and lower cash exceptionals, partly offset by working capital outflow. Net debt reduced significantly from GBP 112 million to GBP 25 million, driven by the improved free cash flow, proceeds from the sale of our 50% stake in PZ Wilmar, and the disposal of surplus non-operating assets.

Speaker #3: And secondly, the mix of growth, with Africa's strong performance driving a proportionally higher minority interest charge, and in particular, as we saw strong growth in electricals, in which we have a lower net ownership than elsewhere.

Speaker #3: Critically, free cash flow improved strongly to £54.7 million, compared with £42.3 million last year, reflecting higher adjusted operating profit and lower cash exceptionals, partly offset by a working capital outflow.

Speaker #3: Net debt reduced significantly, from £112 million to £25 million, driven by the improved free cash flow, proceeds from the sale of our 50% stake in PZ Wilmar, and the disposal of surplus non-operating assets.

Speaker #3: As a result of our performance in FY26 and our confidence in the future, the Board has proposed a dividend increase of 2.8%, consistent with our progressive dividend policy.

Jan Bramall: As a result of the performance in FY26 and our confidence in the future, the board has proposed a dividend increase of 2.8%, consistent with our progressive dividend policy. Turning now to revenue. The revenue bridge shows growth across each of the three reporting regions, each of the four lead markets, and in both the developed and the emerging parts of the portfolio. The single largest contribution has again been from growth in Nigeria. Pleasingly, although this was largely inflation-driven, we have seen a much more stable economic environment in Nigeria. In fact, the movement in the Naira has been favorable, with the red down bar for FX driven by the strengthening of sterling against other currencies. Turning to operating profit, and with the 24.5% growth, I'm pleased with the quality of this delivery.

Speaker #3: Turning now to revenue. The revenue bridge shows growth across each of the three reporting regions, each of the four lead markets, and in both the developed and the emerging parts of the portfolio.

Speaker #3: A single largest contribution has again been from growth in Nigeria. Pleasingly, although this was largely inflation-driven, we have seen a much more stable economic environment in Nigeria. In fact, the movement in the naira has been favorable, with the red down bar for FX driven by the strengthening of sterling against other currencies.

Speaker #3: So, turning to operating profit—and with the 24.5% growth, I’m pleased with the quality of this delivery. We saw growth in both gross profit and a reduction in overheads, thanks in part to £8.5 million in structural cost savings, allowing us to increase marketing investment by £3.5 million.

Jan Bramall: We saw growth in both gross profit and reduction in overheads, thanks in part to GBP 8.5 million structural cost savings, allowing us to increase marketing investment by GBP 3.5 million. The GBP 59.5 million operating profit we reported includes GBP 5.4 million of FX gains, as the revaluation of US dollar-denominated liabilities in Nigeria reduced, thanks to the appreciation of the Naira. This is a one-off gain in FY26. I would encourage you to think of our normalized operating profit from which we will grow in FY27 as being closer to GBP 54 million. This slide links the FY26 performance back to the financial framework we set out at the Capital Markets event. Over the cycle, we are targeting mid-single digit like-for-like revenue growth, with increased marketing investment funded by gross margin expansion and overhead growth limited to be below that of revenue.

Speaker #3: The £59.5 million operating profit we reported includes £5.4 million of FX gains, as the revaluation of US dollar-denominated liabilities in Nigeria reduced, thanks to the appreciation of the naira.

Speaker #3: This is a one-off gain in FY26, so I would encourage you to think of our normalized operating profit—which we will grow from in FY27—as being closer to £54 million.

Speaker #3: This slide links the FY26 performance back to the financial framework we set out at the Capital Markets event. Over the cycle, we are targeting mid-single-digit like-for-like revenue growth, with increased marketing investment funded by gross margin expansion, and overhead growth limited to be below that of revenue.

Speaker #3: I'm pleased to say that in FY26, we delivered against this framework. The result is improved quality of earnings, revenue growth supported by investment, productivity gains funding that investment, and a stronger, more resilient profit base.

Jan Bramall: I'm pleased to say that in FY26, we delivered against this framework. The result is improved quality of earnings, revenue growth supported by investment, productivity gains funding that investment, and a stronger, more resilient profit base. Looking now at the segments, starting with Europe and Americas. Revenue increased to GBP 200 million, with like-for-like revenue growth of 0.9%. In the UK, our lead market, revenue grew 0.5% to GBP 175 million. We delivered growth across the key washing and bathing brands, Carex, Imperial Leather, Original Source, and Sanctuary Spa, with Sanctuary Spa, the biggest contributor driven by strong Christmas gifting. Outside the UK, revenue grew 3.8%. Most notably, St. Tropez returned to growth in North America, growing 6.9%, supported by the new operating model and partnership with Amazon. This was offset by some softness in continental Europe.

Speaker #3: Looking now at the segments, starting with Europe and the Americas. Revenue increased to £200 million, with like-for-like revenue growth of 0.9%. In the UK, our lead market, revenue grew 0.5% to £175 million. We delivered growth across the key washing and bathing brands: Carex, Imperial Leather, Original Source, and Sanctuary Spa, with Sanctuary Spa the biggest contributor, driven by strong Christmas gifting.

Speaker #3: Outside the UK, revenue grew 3.8%. Most notably, SandtraPay returned to growth in North America, growing 6.9%, supported by the new operating model and partnership with Emerson. This was offset by some softness in continental Europe.

Speaker #3: Operating profit was broadly flat, as improved gross margins and good cost containment offset increases in marketing investment. Turning to APAC, revenue was £173 million, up 3.9% on a like-for-like basis, but flat on a reported basis reflecting movements in the Indonesian rupiah and Australian dollar.

Jan Bramall: Operating profit was broadly flat as improved gross margins and good cost containment offset increases in marketing investment. Turning to APAC. Revenue was GBP 173 million, up 3.9% on a like-for-like basis, but flat on a reported basis, reflecting movements in the Indonesian rupiah and Australian dollar. In ANZ, revenue grew 4% to GBP 91 million, with growth across Morning Fresh, Radiant, and Rafferty's Garden. Morning Fresh benefited from strong performance in Auto Dish. Rafferty's Garden grew strongly with early success from its relaunch into New Zealand, and the 1-liter Original Source launch provided significant uplift to revenue. Indonesia grew 10.2% to GBP 61 million, driven by Cussons Baby, with improvements in both price mix and volume. The growth was driven by the completion of the phased restaging of the overall brand, and e-commerce remains a major growth driver, with strong growth across TikTok Shop and Shopee.

Speaker #3: In ANZ, revenue grew 4% to $91 million, with growth across Morning Fresh, Radiant, and Rafferty’s Garden. Morning Fresh benefited from strong performance in auto dish. Rafferty’s Garden grew strongly with early success from its relaunch into New Zealand, and the 1-litre Original Source launch provided significant uplift to revenue.

Speaker #3: Indonesia grew 10.2% to 61 million, driven by Cussons Baby, with improvements in both price mix and volume. The growth was driven by the completion of the phased restaging of the overall brand, and e-commerce remained a major growth driver, with strong growth across TikTok Shop and Shopee.

Speaker #3: The reduction in adjusted operating profit reflected increased marketing investment behind Auto Dish and the Cussons Baby restaging, together with a depreciation of the Australian dollar and Indonesian rupiah.

Jan Bramall: The reduction in adjusted operating profit reflected increased market investment behind Auto Dish and the Cussons Baby restaging, together with the depreciation of the Australian dollar and Indonesian rupiah. Moving to Africa. Revenue increased to GBP 168 million, with like-for-like revenue growth of 14.7%. Revenue in our Nigerian lead market grew 22% to GBP 133 million, with growth in both price mix and volume. We delivered double-digit growth across the majority of our largest brands, with Stella particularly strong, supported by increased exports and work to extend the purchase period beyond the seasonal peak of the Harmattan dry season. Route to market improvements also continued to support performance as we again grew both the quantity and the quality of stores served. Our electricals business grew revenue by over 20%, driven primarily by refrigeration products and continuing to capitalize on the strengths of our exclusive showroom network.

Speaker #3: Moving to Africa, revenue increased to $168 million, with like-for-like revenue growth of 14.7%. Revenue in our Nigerian lead market grew 22% to $133 million, with growth in both price mix and volume.

Speaker #3: We delivered double-digit growth across the majority of our largest brands, with Stellar particularly strong. This was supported by increased exports and work to extend the purchase period beyond the seasonal peak of the Harmattan dry season.

Speaker #3: Route-to-market improvements also continue to support performance, as we again grew both the quantity and the quality of stores served. Our electricals business grew revenue by over 20%, driven primarily by refrigeration products and continuing to capitalize on the strengths of our exclusive showroom network.

Speaker #3: Adjusted operating profit growth included a £4.6 million benefit from the revaluation of U.S. dollar-denominated liabilities in Nigeria following the appreciation of the naira, partly offset by significantly increased marketing investment, including support for the Carex launch.

Jan Bramall: Adjusted operating profit growth included GBP 4.6 million benefit from the revaluation of US dollar denominated liabilities in Nigeria following the appreciation of the Naira, partly offset by significantly increased marketing investment, including support for the Carex launch. Turning now to cash flow and net debt. Net debt reduced by GBP 87 million to GBP 25 million. The big drivers here being the increase in free cash flow and disposal proceeds. Free cash flow was GBP 54.7 million, up GBP 12 million, supported by higher operating profit and less cash exceptionals. The PZ Wilmar disposal proceeds were GBP 47.8 million, with a further GBP 27.6 million associated with surplus asset sales. You'll remember that in calculating leverage, we exclude the benefit of the cash held within Nigeria of GBP 24.5 million.

Speaker #3: Turning now to cash flow and net debt. Net debt reduced by 87 million to 25 million, the big drivers here being the increase in free cash flow and disposal proceeds.

Speaker #3: Free cash flow was 54.7 million, up 12 million, supported by higher operating profit and less cash exceptionals. The Wilmer disposal proceeds were 47.8 million, with a further 27.6 million associated with surplus asset sales.

Speaker #3: You'll remember that in calculating leverage, we excluded the benefit of the cash held within Nigeria of £24.5 million. This results in an adjusted net debt to EBITDA of 0.7 times, which is below the 1 to 1.5 times range set out as part of the capital allocation policy.

Jan Bramall: This results in the adjusted net debt to EBITDA of 0.7x, so below the 1x to 1.5x range set out as part of the capital allocation policy. Taking a step back, the balance sheet has been transformed over recent years, with gross debt GBP 174 million lower than 3 years ago. Related to the reduction in group debt is how our exposure to movements in the Naira has materially reduced. A major source of the impact on operating profit has been the intercompany liabilities within Nigeria entity denominated currency other than the Naira. As the Naira devalued, these liabilities increased in value, reducing our operating profit. The reduction in these liabilities has left us in a much stronger position. Historically, NGN 100 remove would have driven more than GBP 7 million impact on operating profit. Today, that sensitivity on underlying operating profit is around GBP 1.5 million, and we continue to work to decrease these liabilities, and therefore the P&L sensitivity even further.

Speaker #3: Taking a step back, the balance sheet has been transformed over recent years, with gross debt £174 million lower than three years ago. Related to the reduction in group debt is how our exposure to movements in the naira has materially reduced.

Speaker #3: A major source of the impact on operating profit has been the intercompany liabilities within the Nigeria entity denominated in currency other than the naira. As the naira devalued, these liabilities increased in value, reducing our operating profit.

Jan Bramall: As the Naira devalued, these liabilities increased in value, reducing our operating profit. The reduction in these liabilities has left us in a much stronger position. Historically, NGN 100 remove would have driven more than GBP 7 million impact on operating profit. Today, that sensitivity on underlying operating profit is around GBP 1.5 million, and we continue to work to decrease these liabilities, and therefore the P&L sensitivity even further.

Speaker #3: The reduction in these liabilities has left us in a much stronger position. Historically, a 100 naira move would have driven more than £7 million impact on operating profit.

Speaker #3: Today, that sensitivity on underlying operating profit is around £1.5 million, and we continue to work to decrease these liabilities and therefore the P&L sensitivity even further.

Speaker #3: Our capital allocation framework as set out at the capital markets event is clear. First, we are targeting adjusted net debt that is excluding cash held in Nigeria to the adjusted EBITDA in the range of 1 to 1.5 times.

Jan Bramall: Our capital allocation framework, as set out at the capital markets event, is clear. First, we are targeting adjusted net debt, that is excluding cash held in Nigeria, to the adjusted EBITDA in the range of 1x to 1.5x. Second, we have adopted a progressive dividend policy. Third, we will consider bolt-on M&A, and Jonathan will talk shortly about how Childs Farm represents something of a blueprint for what we're looking at. Fourth, cash returns to shareholders will be considered relative to those M&A opportunities. Given year-end adjusted net debt to EBITDA of 0.7x, we now have substantial flexibility within that framework.

Speaker #3: Second, we have adopted a progressive dividend policy. Third, we will consider bolt-on M&A, and Jonathan will talk shortly about how Childs Farm represents something of a blueprint for what we're looking at.

Speaker #3: And fourth, cash returns to shareholders will be considered relative to those M&A opportunities. Given year-end adjusted net debt to EBITDA of 0.7 times, we now have substantial flexibility within that framework.

Speaker #3: So, the key message is not that leverage has reduced; it is that stronger cash generation, portfolio simplification, and disciplined capital allocation have put the group in a much better position to invest behind growth, support a progressive dividend, and evaluate additional shareholder returns or M&A where it creates value.

Jan Bramall: The key message is not that leverage has reduced, it is that stronger cash generation, portfolio simplification, and disciplined capital allocation have put the group in a much better position to invest behind growth, support a progressive dividend, and evaluate additional shareholder returns or M&A where it creates value. Finally, turning to current trading and FY27 guidance. As we said in the release this morning, the year has started in line with expectations. Like everyone else in the sector, we are mindful of the impacts of the conflict in the Middle East. While there is still a number of unknowns, we have since the start, at the start of the crisis, acted swiftly to understand and react to the impact, and believe that the large majority of the cost inflation can be offset by mitigating actions already in place.

Speaker #3: Finally, turning to current trading and FY27 guidance. As we said in the release this morning, the year has started in line with expectations. Like everyone else in the sector, we are mindful of the impact of the conflict in the Middle East.

Speaker #3: While there are still a number of unknowns, we have, since the start of the crisis, acted swiftly to understand and react to the impact, and believe that the large majority of the cost inflation can be offset by mitigating actions already in place.

Speaker #3: As a result, we are comfortable confirming current market expectations for operating profit, which range from £58 million to £61.2 million. The H1/H2 split is expected to be more balanced than it was in FY26, where operating profit was skewed more towards H1, given the majority of the FX gains fell in the first half of the year and the majority of the marketing spend came in the second half.

Jan Bramall: As a result, we are comfortable confirming current market expectations for operating profit, which range from GBP 58 to 61.2 million. The H1, H2 split is expected to be more balanced than it was in FY26, where operating profit was skewed more towards H1, given the majority of the FX gains fell in H1, and the majority of the marketing spend came in H2. Based on spot rates, we don't currently foresee a material FX impact year on year, and we'd expect net debt to be lower again, reflecting continued strong underlying cash generation. Overall, we enter FY27 with good underlying momentum, a stronger balance sheet, reduced exposure to the Nigerian FX volatility, and a better funded innovation pipeline.

Speaker #3: Based on spot rates, we don't currently foresee a material FX impact year-on-year. And we'd expect net debt to be lower again, reflecting continued strong underlying cash generation.

Speaker #3: Overall, we enter FY27 with good underlying momentum, a stronger balance sheet, reduced exposure to Nigerian FX volatility, and a better-funded innovation pipeline.

Jan Bramall: Overall, we enter FY27 with good underlying momentum, a stronger balance sheet, reduced exposure to the Nigerian FX volatility, and a better funded innovation pipeline. While there are external uncertainties to manage, the business is in a stronger position to continue delivering against the strategy and financial framework we have set out. With that, I will hand back to Jonathan.

Speaker #3: While there are external uncertainties to manage, the business is in a stronger position thanks to the strategy and financial framework we have set out. And with that, I will hand back to Jonathan.

Jan Bramall: While there are external uncertainties to manage, the business is in a stronger position to continue delivering against the strategy and financial framework we have set out. With that, I will hand back to Jonathan.

Speaker #2: Thanks, Jen. Let me now provide a broader update on progress and performance. Our strategy is focused and disciplined, centered around three core categories: personal, home, and baby care.

Jonathan Myers: Thanks, Jan. Let me now come on to provide a broader update on progress and performance. Our strategy is focused and disciplined, centered around 3 core categories, personal, home, and baby care, in 4 lead markets, the UK, Australia, New Zealand, Nigeria, and Indonesia. We have a balanced geographic footprint with around 60% of revenue from developed markets and 40% from emerging markets. In our lead markets, our competitive advantage comes from our locally loved brands, our go-to-market capabilities, and manufacturing scale and agility. Our strategy is built on these competitive advantages, which actually we sum up in just 10 words as 5 priorities. Build brands, serve consumers, reduce complexity, develop people, and grow sustainably. Finally, as Jan has discussed, we're clear on how we will allocate capital to maximize shareholder returns.

Speaker #2: In our four lead markets—the UK, Australia, New Zealand, Nigeria, and Indonesia—we have a balanced geographic footprint, with around 60% of revenue from developed markets and 40% from emerging markets.

Speaker #2: In our lead markets, our competitive advantage comes from our locally loved brands, our go-to-market capabilities, and manufacturing scale and agility. Our strategy is built on these competitive advantages, which actually we sum up in just ten words as five priorities: build brands, serve consumers, reduce complexity, develop people, and grow sustainably.

Speaker #2: Finally, as Jen has discussed, we're clear on how we will allocate capital to maximize shareholder returns. So, a clear framework of sharper portfolio choices, stronger execution, and disciplined use of cash to drive sustainable, long-term value.

Jonathan Myers: A clear framework of sharper portfolio choices, stronger execution, and disciplined use of cash to drive sustainable long-term value. Let's take a look at progress we have made against these five priorities. Starting with some examples of how we are building brands and serving consumers. Gifting in the UK has been a clear success, where we've been learning and optimizing our plans each year. Take Sanctuary Spa gifting, where revenue is up more than 70% over the past two years. This has been achieved through improved product offering, optimizing the pricing architecture of the range, including playing at higher price points, and through bigger, better in-store displays and activation. We broadened retailer participation in the program last Christmas, adding seven new customers, and pushed for stronger execution in those retailers already involved. Take Boots, for example.

Speaker #2: Now, let's take a look at the progress we have made against these five priorities, starting with some examples of how we are building brands and serving consumers.

Speaker #2: Gifting in the UK has been a clear success, where we've been learning and optimizing our plans each year. Take Sanctuary Spa gifting, where revenue is up more than 70% over the past two years.

Speaker #2: This has been achieved through improved product offerings, optimizing the pricing architecture of the range—including playing at higher price points—and through bigger, better in-store displays and activation.

Speaker #2: We broadened retailer participation in the program last Christmas, adding seven new customers, and pushed for stronger execution in those retailers already involved. Take Boots, for example.

Speaker #2: They sold a PZ gift set every 15 seconds in the run-up to Christmas last year. And it may surprise some of you, as you listen to this with your minds secretly wandering off to the sun loungers you're hoping to secure around the pool in the next couple of weeks, but we've actually already started making deliveries of our 2026 Christmas gift sets to retailers' warehouses, and we're well on track to delivering our first million units of the season.

Jonathan Myers: They sold a PZ gift set every 15 seconds in the run-up to Christmas last year. It may surprise some of you as you listen to this with your mind secretly wandering off to the sun loungers you're hoping to secure around the pool in the next couple of weeks. We've actually already started making deliveries of our 2026 Christmas gift sets to retailers' warehouses, and we're well on track to delivering our first million units of the season. Watch this space for more to come as we expand our offering to more brands at more price points and at other gifting occasions through the year. I hope I've given you all some inspiration for your own last-minute shopping when it comes to Christmas 2026. Moving from one season to another, let's move to our other highly seasonal business, St. Tropez.

Speaker #2: Watch this space for more to come as we expand our offering to more brands, at more price points, and at other gifting occasions throughout the year.

Speaker #2: And I hope I've given you all some inspiration for your own last-minute shopping when it comes to Christmas 2026. Moving from one season to another, let's move to our other highly seasonal business, Saint-Tropez.

Speaker #2: In June last year, we announced the decision to retain the brand and embark on a new strategic direction. It's reassuring, therefore, to be able to report that after two years of double-digit decline on Saint-Tropez in North America, our partnership with the Emerson Group is already bearing fruit, with a return to growth of 7% in FY26.

Jonathan Myers: In June last year, we announced the decision to retain the brand and embark on a new strategic direction. It's reassuring, therefore, to be able to report that after two years of double-digit decline on St. Tropez in North America, our partnership with the Emerson Group is already bearing fruit, with a return to growth of 7% in FY26. Emerson's scale and expertise in the US stretches across customer management, logistics, and brand activation. When it's coupled with our dedicated multifunctional St. Tropez team of experts in the category, we have confidence that better brand building and stronger execution will unlock the potential we saw in the brand when we made the call to retain it. Take Amazon, for example, which was the first channel Emerson turned their attention to as part of the phased transition of the business from our own operation last year.

Speaker #2: Emerson's scale and expertise in the U.S. stretches across customer management, logistics, and brand activation. When it's coupled with our dedicated, multifunctional Saint-Tropez team of experts in the category, we have confidence that better brand building and stronger execution will unlock the potential we saw in the brand when we made the call to retain it.

Speaker #2: Take Amazon, for example, which was the first channel Emerson turned their attention to as part of the phased transition of the business from our own operation last year.

Speaker #2: It was already a growing channel for us, but Emerson brought their experience to bear, starting with getting the basics right, improving and optimizing product pages, increasing media efficiency, and aligning promotional activity to Amazon events.

Jonathan Myers: It was already a growing channel for us, Emerson brought their experience to bear. Starting with getting the basics right, improving and optimizing product pages, increasing media efficiency, and aligning promotional activity to Amazon events. As a result, our growth rate more than doubled, and Amazon is now St. Tropez's number one customer in the US, not unlike many other premium beauty brands. However, there is no room for complacency. We have more to do in North America and elsewhere. We did not grow in the UK, and have been working hard to improve performance here, especially in the run-up to the peak season. Though not yet reflected in the reported revenue numbers, we have seen sequential improvement in retail sales in the UK as we came into the summer 2026 season, accelerating to reach double-digit growth in the peak season and a return to market share growth.

Speaker #2: As a result, our growth rate more than doubled, and Amazon is now Saint-Tropez's number one customer in the US, not unlike many other premium beauty brands.

Speaker #2: However, there is no room for complacency. We have more to do in North America and elsewhere. We did not grow in the UK, and have been working hard to improve performance here, especially in the run-up to the peak season.

Speaker #2: Though not yet reflected in the reported revenue numbers, we have seen sequential improvement in retail sales in the UK as we came into the summer 2026 season.

Speaker #2: Accelerating to reach double-digit growth in the peak season and a return to market share growth. Looking to next year and beyond, we have stronger and bigger innovation planned for summer 2027.

Jonathan Myers: Looking to next year and beyond, we'll have stronger and bigger innovation for summer 2027. In fact, four times the number of new products, including one patent-pending potential blockbuster launch. We'll also have innovation targeted at younger consumers as we seek to rejuvenate the brand and revitalize what it stands for. This includes where consumers see and interact with the brand, hence the UK launch on TikTok Shop just last month. It's clearly early days, and we're in the phase of testing out what works and what doesn't. This is an example of how we are pushing the brand into new channels to reach new consumers. With our ANZ business returning to full-year revenue growth, it's important to call out the role innovation played alongside expansion beyond the grocery channel and a renewed focus on New Zealand.

Speaker #2: In fact, four times the number of new products, including one patent-pending, potential blockbuster launch. We'll also have innovation targeted at younger consumers, as we seek to rejuvenate the brand and revitalize what it stands for.

Speaker #2: This includes where consumers see and interact with the brand—hence the UK launch on TikTok Shop just last month. It's clearly early days, and we're in the phase of testing out what works and what doesn't, but this is an example of how we are pushing the brand into new channels to reach new consumers.

Speaker #2: With our ANZ business returning to full-year revenue growth, it's important to call out the role innovation played, alongside expansion beyond the grocery channel and a renewed focus on New Zealand.

Speaker #2: We're making steady, sustained progress with our entry into the auto dish category, taking 160 basis points of share growth in the year, peaking at a 10% share when on promotion, where it stopped.

Jonathan Myers: We're making steady, sustained progress with our entry into the Auto Dish category, taking 160 basis points of share growth in the year, peaking at a 10% share when on promotion where it stopped. As you may know, we're up against some formidable and well-established competition here, but we continue to see significant opportunity given the strength of the Morning Fresh brand in the washing up liquid market, not least fueled by disruptive packaging innovation in that category too. We've also seen a step change in the success of Original Source, getting the basics right to win in Australia, which is a market dominated by larger packs, often with a pump.

Speaker #2: As you may know, we're up against some formidable and well-established competition here, but we continue to see significant opportunity given the strength of the Morning Fresh brand in the washing-up liquid market—not least fueled by disruptive packaging innovation in that category too.

Speaker #2: We've also seen a step change in the success of Original Source, getting the basics right to win in Australia, which is a market dominated by larger packs, often with a pump.

Speaker #2: Hence, the launch of our new one-liter pump pack has hit the ground running, rather than our previous over-reliance on the UK-preferred 250 ml pack size, often dismissed as a travel size or one for the gym bag by the average Ollie shopper.

Jonathan Myers: Hence, the launch of our new 1-liter pump pack has hit the ground running rather than our previous over-reliance on the UK preferred 250 ml pack size, often dismissed as a travel size or one for the gym bag by the average Aldi shopper. In Indonesia, we completed the phased restage of our leading Cussons Baby brand, driving sustained market share growth through the year, as well as double-digit revenue growth. We have activated the relaunched brand across all channels, including fast-growing e-commerce and quick commerce. In fact, from our Jakarta factory enabling us to run at all hours, we are now live streaming from our own studios across TikTok Shop and other social media shopping platforms to reach our busy consumers wherever they are, at work, at home, or stuck in typical Jakarta commuter traffic. Moving to Nigeria now.

Speaker #2: In Indonesia, we completed the phased restage of our leading Cussons Baby brand, driving sustained market share growth throughout the year as well as double-digit revenue growth.

Speaker #2: We have activated the relaunch brand across all channels, including fast-growing e-commerce and quick commerce. In fact, from our Jakarta factory—enabling us to run at all hours—we are now live streaming from our own studios across TikTok Shop and other social media shopping platforms to reach our busy consumers wherever they are: at work, at home, or stuck in typical Jakarta commuter traffic.

Speaker #2: Moving to Nigeria now. We've obviously talked at length about the opportunities we see for our business there and our strategy to unlock them. As Agale set out at the Capital Markets event in February, we have three main priorities.

Jonathan Myers: We've obviously talked at length about the opportunities we see for our business there and our strategy to unlock them. As Oghale set out at the Capital Markets event in February, we have three main priorities. It starts with growing our core. We're doing this by driving distribution and building stronger brands. Take Morning Fresh, the number one washing up liquid in Nigeria. The Care We Share campaign has challenged household norms with the question, who should wash the dishes? Positioning the brand as an advocate for shared responsibility in the modern Nigerian home and reinforcing the brand's benefit that cleaning the dishes is easier and faster with a product that really performs. Our own campaign was amplified by social media influencers, turning a simple question about household chores into a national conversation, reaching nearly 50 million people and helping elevate the brand beyond just the functional benefits on offer.

Speaker #2: It starts with growing our core. We're doing this by driving distribution and building stronger brands. Take Morning Fresh, the number one washing-up liquid in Nigeria.

Speaker #2: The Care We Share campaign has challenged household norms with the question: Who should wash the dishes? It positions the brand as an advocate for shared responsibility in the modern Nigerian home, and reinforces the brand's benefits by highlighting that cleaning the dishes is easier and faster with a product that really performs.

Speaker #2: Our own campaign was amplified by social media influencers, turning a simple question about household chores into a national conversation, reaching nearly 50 million people and helping elevate the brand beyond just the functional benefits on offer.

Speaker #2: We're also expanding the categories in which we play. The launch of Carex, increasingly a trusted authority in family hygiene, saw us deliver incremental revenue and win Brand of the Year in the Nigerian Marketing Awards.

Jonathan Myers: We're also expanding the categories in which we play. The launch of Carex, increasingly a trusted authority in family hygiene, saw us deliver incremental revenue and win brand of the year in the Nigerian Marketing Awards. We continue to make progress delivering growth through exporting to new countries. In FY26, we accelerated growth to West and Central African markets, contributing to growth in our Nigerian revenue and in hard currency too. Jan talked about the opportunity for bolt-on M&A in the context of our capital allocation policy. We see Childs Farm as a potential blueprint for this type of M&A, taking a growing founder-led brand on the next leg of its journey. Since our acquisition in 2022, we have created value through leveraging our competitive advantages. We've used innovation and a restage of the brand to strengthen its equity.

Speaker #2: Finally, we continue to make progress, delivering growth through exporting to new countries. In FY26, we accelerated growth to West and Central African markets, contributing to growth in our Nigerian revenue—and in hard currency, too.

Speaker #2: Jan talked about the opportunity for bolt-on M&A in the context of our capital allocation policy, and we see Charles Farm as a potential blueprint for this type of M&A—taking a growing, founder-led brand on the next leg of its journey.

Speaker #2: Since our acquisition in 2022, we have created value through leveraging our competitive advantages. We've used innovation and a restage of the brand to strengthen its equity.

Speaker #2: We've leveraged our go-to-market capabilities to drive distribution and form exciting partnerships. We have insourced production where it makes sense and otherwise maintained effective arrangements with our third-party manufacturing partners.

Jonathan Myers: We've leveraged our go-to-market capabilities to drive distribution and form exciting partnerships. We've insourced production where it makes sense, and otherwise maintained effective arrangements with our third-party manufacturing partners. Alongside the competitive advantage that we can bring, we can also add scale advantage. In fact, the combined savings from organizational and manufacturing integration completed last year are in excess of GBP 4 million. It's also exciting to let you know today that thanks to strong collaboration with the Emerson Group in the US, we have recently launched Childs Farm into Walmart. We secured online distribution earlier in the year and have now opened up in-store distribution over the past few weeks. In fact, such is the support from Walmart in their latest range review, Childs Farm is now on the shelves of every single one of Walmart's 4,600 stores in the US.

Speaker #2: Alongside the competitive advantage that we can bring, we can also add scale advantage. In fact, the combined savings from organizational and manufacturing integration completed last year are in excess of $4 million.

Speaker #2: It's also exciting to let you know today that, thanks to strong collaboration with the Emerson Group in the US, we have recently launched Charles Farm into Walmart.

Speaker #2: We secured online distribution earlier in the year and have now opened up in-store distribution over the past few weeks. In fact, such is the support from Walmart in their latest range review, Charles Farm is now on the shelves of 4,600 stores in the US.

Speaker #2: While it's still very early days, and we are quite sanguine that the US will be a challenging market to crack, our partnership with Emerson gives us a strong platform for growth on a brand that we have already proven in the UK.

Jonathan Myers: While it's still very early days, and we are quite sanguine that the US will be a challenging market to crack, our partnership with Emerson gives us a strong platform for growth on a brand that we have already proven in the UK. Early signs from US shoppers and the Walmart buying team are positive, though we recognize the hard work has only just begun. Stepping back, how have we done with the overall acquisition? Well, the brand is now firmly profitable as well as growing, and is on track for a post return on capital employed in excess of our weighted average cost of capital in FY27. This, combined with the opportunity in the US, reassured us that we made the right call to add Childs Farm to the PZ portfolio back in 2022. Meanwhile, we've also continued to reduce complexity across the business. Firstly, through portfolio simplification.

Speaker #2: Early signs from US shoppers and the Walmart buying team are positive, though we recognize the hard work has only just begun. Stepping back then, how have we done with the overall acquisition?

Speaker #2: Well, the brand is now firmly profitable, as well as growing, and is on track for a post-return on capital employed in excess of our weighted average cost of capital in FY27.

Speaker #2: This, combined with the opportunity in the US, reassured us that we made the right call to add Charles Farm to the PZ portfolio back in 2022.

Speaker #2: Meanwhile, we've also continued to reduce complexity across the business, firstly through portfolio simplification. Most significant was the $50 million-plus disposal of our stake in the non-core PZ Wilmar business.

Jonathan Myers: Most significant was the GBP 50 million plus disposal of our stake in the non-core PZ Wilmar business. We also exceeded the GBP 20 to 25 million guidance we communicated for other non-core surplus asset sales, achieving more than GBP 27 million from disposals in Asia and Africa. Secondly, through operational simplification, consolidating UK and European operating models into one set of systems and processes, building a central data warehouse to enhance reporting and analytics capabilities, as well as the consolidation and integration of 33 brand websites, improving the shop window for our brands to consumers around the world, as well as stepping up our cybersecurity measures. In summary, good progress made, we are not yet done making our business simpler and more focused. We've also made good progress strengthening the organization as we continue to invest in attracting and retaining the best people across the business to drive performance.

Speaker #2: But we also exceeded the £20 to £25 million guidance we communicated for other non-core surplus asset sales, achieving more than £27 million from disposals in Asia and Africa.

Speaker #2: Secondly, through operational simplification: consolidating UK and European operating models into one set of systems and processes, and building a central data warehouse to enhance reporting and analytics capabilities.

Speaker #2: As well as the consolidation and integration of 33 brand websites, improving the shop window for our brands to consumers around the world, and stepping up our cybersecurity measures.

Speaker #2: In summary, good progress has been made, but we are not yet done making our business simpler and more focused. We've also made good progress in strengthening the organization, as we continue to invest in attracting and retaining the best people across the business to drive performance.

Speaker #2: In FY26, our global engagement survey secured a 97% participation rate, itself an indication of an engaged organization. Overall, the survey generated an 83% global engagement score, well ahead of all industry and specific consumer sector benchmarks.

Jonathan Myers: In FY26, our global engagement survey secured a 97% participation rate, itself an indication of an engaged organization. Overall, the survey generated an 83% global engagement score, well ahead of all industry and specific consumer sector benchmarks. To consolidate on this strong foundation, we've launched a renewed employee value proposition, Dare, Discover, Do, as we strive to attract great talent and create a stronger performance culture in the business. Of course, sustainability remains critical as we grow our brands, whether that's for our employees, our consumers, or other stakeholders. We're making tangible progress on reducing our carbon footprint with a 73% reduction in scope one and two emissions versus 2021, and securing an A- in the well-established and industry-recognized Carbon Disclosure Project scoring system in 2025. We are also reducing plastic intensity, for example, through bigger pack formats, continuing to prove the consumer experience and value on profit.

Speaker #2: To consolidate on this strong foundation, we've launched a renewed employee value proposition: Dare, Discover, Do, as we strive to attract great talent and create a stronger performance culture in the business.

Speaker #2: And of course, sustainability remains critical as we grow our brand, whether that's for our employees, our consumers, or other stakeholders. We're making tangible progress on reducing our carbon footprint, with a 73% reduction in scope one and two emissions versus 2021, and securing an A minus in the well-established and industry-recognized Carbon Disclosure Project scoring system in 2025.

Speaker #2: We are also reducing plastic intensity, for example, through bigger pack formats, continuing to improve the consumer experience, and value on offer. And we know some challenges require more coordinated, broader intervention.

Jonathan Myers: We know some challenges require more coordinated, broader interventions, so we're working through cross-industry collaborations to help transform the infrastructure around us. We were proud to join forces with our industry peers as a founding signatory for the UK Plastics Pact, an initiative to transform packaging and promote circularity, reuse, and sustainability. For us, sustainability is central to our growth and remains critical to our long-term success. Now, let me sum up. Our renewed strategy is starting to translate into delivery. We have so much more to do, but we take reassurance from the early signs of progress. FY26 was a strong year in terms of performance, with gross growth across all lead markets and our top 10 brands. Increased brand investment supported our growth in FY26 and planted seeds for sustained growth in future years.

Speaker #2: So we're working through cross-industry collaborations to help transform the infrastructure around us. We were proud to join forces with our industry peers as a founding signatory for the UK Packaging Pact, an initiative to transform packaging and promote circularity, reuse, and sustainability.

Speaker #2: For us, sustainability is central to our growth and remains critical to our long-term success. So now, let me sum up. Our renewed strategy is starting to translate into delivery.

Speaker #2: We have so much more to do, but we take reassurance from the early signs of progress. FY26 was a strong year in terms of performance.

Speaker #2: We saw growth across all lead markets and our top 10 brands. Increased brand investment supported our growth in FY26 and planted seeds for sustained growth in future years.

Speaker #2: In Nigeria, we have navigated significant external challenges and are now implementing effective guardrails to reduce FX risk and sensitivity, leading us to focus on driving well-established brands in a market with significant opportunity.

Jonathan Myers: In Nigeria, we have navigated significant external challenges and are now implementing effective guardrails to reduce FX risk and sensitivity, leading us to focus on driving well-established brands in a market with significant opportunity. Our balance sheet is in good shape, allowing us to invest in the business, renew dividend growth, and give us the option for bolt-on M&A in the future. We have started FY27 in line with our expectations, despite the obvious macroeconomic uncertainties that we are all well aware of. As I pause for a moment to assess the bigger picture, reassured by our renewed momentum and informed by our refreshed strategy, I am confident that PZ Cussons is well-placed to deliver sustainable growth over the coming years. With that, we'd be delighted to take your questions. I'll pass over to Adam.

Speaker #2: Our balance sheet is in good shape, allowing us to invest in the business, renew dividend growth, and give us the option for bolt-on M&A in the future.

Speaker #2: And we have started FY27 in line with our expectations, despite the obvious macroeconomic uncertainties that we are all well aware of. So, as I pause for a moment to assess the bigger picture, reassured by our renewed momentum and informed by our refreshed strategy, I am confident that PZ Cussons is well placed to deliver sustainable growth over the coming years.

Speaker #2: With that, we'd be delighted to take your questions, so I'll pass over to Adam.

Speaker #1: Thank you. As a reminder, if you'd like to ask a question on today's call, please dial in and use the dial-in details to the left of the slides, and press star followed by one on your telephone keypad once you are connected.

Operator: Thank you. As a reminder, if you'd like to ask a question on today's call, please dial in and use the dial-in details to the left of the slide and press star followed by one on your telephone keypad once you are connected. Star followed by one. We take our first question today from Matthew Webb at Investec. Matthew, please go ahead. Your line is open.

Speaker #1: Star, followed by one. We take our first question today from Matthew Webb at Investech. Matthew, please go ahead. Your line is open.

Speaker #3: Hi, good morning, everyone. Can I just start off by asking about St. Tropez and Charles Farm in the US? It’s clearly very encouraging to see St. Tropez back into growth in the US, and the Charles Farm opportunity with Amazon sounds very encouraging as well.

Matthew Webb: Hi. Good morning, everyone. Can I just start off by asking about St. Tropez and Childs Farm in the US? Clearly, very encouraging to see St. Tropez back into growth, in the US and the Childs Farm opportunity with Emerson sounds very encouraging as well. Can you just remind us of what the economics of your relationship with Emerson look like? I suppose what I'm getting at really is, presumably you effectively share the economics of the brand with them and, if this does turn out to be a significant success and revenue growth driver, is that going to be diluted to the margin? How does that work? That's my first question, please.

Speaker #3: Can you just remind us of what the economics of your relationship with Amazon look like? And I suppose what I'm getting at really is, presumably, you effectively share the economics of the brand with them, and if this does turn out to be a significant success and revenue growth driver, what is that going to be diluted to, at the margin?

Speaker #3: How does that work? That's my first question, please.

Speaker #2: Good morning, Matthew, and thanks for the question. You're absolutely right. We're really pleased with the progress we've seen in North America as we've transitioned our Saint-Tropez and now Charles Farm activation and distribution to Amazon.

Jonathan Myers: Good morning, Matthew. Thanks for the question. You're absolutely right. We're really pleased with the progress we've seen in North America as we've transitioned our St. Tropez and now Childs Farm activation and distribution to Emerson. The good news is they have worked really quickly to get St. Tropez back to growth with, as we saw, Amazon doubling the growth rate. Also as we look to expand and potentially broaden our distribution footprint beyond the historic footprint where we have concentrated. That move is informed by really us working with Emerson to understand where the shopper for St. Tropez is now shopping. The reality is they are broadening the channels at which they're shopping, not just to Amazon, but other places where historically we may not have been distributed. We still see good runway for future growth combined with innovation.

Speaker #2: The good news is they have worked really quickly to get Saint-Tropez back to growth with, as we saw, Amazon doubling the growth rate. But also, as we look to expand and potentially broaden our distribution footprint beyond the historic footprint where we have concentrated.

Speaker #2: And that move is informed by us really working with Amazon to understand where the shopper for Saint-Tropez is now shopping. And the reality is they are broadening the channels in which they're shopping, not just to Amazon, but other places where historically we may not have been distributed.

Speaker #2: So we still see good runway for future growth combined with innovation. And now, of course, with Childs Farm in Walmart—it was already on Amazon—with Childs Farm in Walmart, we have high hopes for long-term sustained growth, but it's really early days.

Jonathan Myers: Now, of course, with Childs Farm in Walmart, it was already on Amazon. With Childs Farm in Walmart, we have high hopes for long-term sustained growth, but it's really early days. Literally, we've been on shelf for weeks. At the moment, we work with Emerson both as a highly effective logistics distribution company, a very effective customer management operation, but also in brand activation. That could be social media activation, that could be media planning, that could be other PR activity that we choose to do. Without going into all the details, because I'm sure you wouldn't expect me to, we ensure that they are suitably incentivized to absolutely hit it out of the park, as the Americans might say, but ensure that we also protect our gross margins.

Speaker #2: Literally, we've been on shelf for weeks. So, at the moment, we work with Amazon both as a highly effective logistics distribution company—a very effective customer management operation—but also in brand activation.

Speaker #2: And that could be social media activation, that could be media planning, that could be other PR activity that we choose to do. And without going into all the details—because I'm sure you wouldn't expect me to—we ensure that they are suitably incentivized to absolutely hit it out of the park, as the Americans might say, but ensure that we also protect our gross margins.

Jonathan Myers: Without going into all the details, because I'm sure you wouldn't expect me to, we ensure that they are suitably incentivized to absolutely hit it out of the park, as the Americans might say, but ensure that we also protect our gross margins. I can assure you that we are quite comfortable with the value creation that we have for ourselves as well as the opportunity for Emerson. Actually, we're in a position where all they want to do and all we want to do is drive really accelerated growth for a sustained period to come.

Speaker #2: And I can assure you that we are quite comfortable with the value creation that we have achieved for ourselves, as well as the opportunity for Amazon.

Jonathan Myers: I can assure you that we are quite comfortable with the value creation that we have for ourselves as well as the opportunity for Emerson. Actually, we're in a position where all they want to do and all we want to do is drive really accelerated growth for a sustained period to come.

Speaker #2: So, actually, we're in a position where all they want to do, and all we want to do, is drive really accelerated growth for sustained periods to come.

Speaker #3: Excellent. That's great to hear. Second question on Nigeria, where I think that clearly the overall economic environment has improved and inflation is moderating.

Matthew Webb: Excellent. That's great to hear. Second question on Nigeria, where I think clearly the overall economic environment has improved and inflation is moderating, but I see is still at quite a high rate. I just wonder what your pricing strategy is in Nigeria at the moment. Should we continue to expect fairly regular price increases? What sort of average price increase do you think you might be looking to take in that market over the next 12 months, say?

Speaker #3: But I see it's still at quite a high rate. I just wonder what your pricing strategy is in Nigeria at the moment. Should we continue to expect fairly regular pricing increases?

Speaker #3: What sort of average price increase do you think that you might be looking to take in that market over the, I don't know, over the next 12 months, say?

Speaker #2: Yeah, very good question. So, obviously, we are reassured by the more benign environment that we have experienced in terms of FX in Nigeria. We've navigated quite a lot of volatility over the last two or three years, and we have also put in place some guardrails to protect us against ongoing FX devaluation, if that rears its head again.

Jonathan Myers: Yeah. Very good question. Obviously we are reassured by the more benign environment that we have experienced in terms of FX in Nigeria, and we've navigated obviously quite a lot of volatility over the last 2 or 3 years, as well as put in place some guardrails to protect us against ongoing FX devaluation if that rears its head again. Inflation obviously is more of a common reality in emerging markets. Current inflation's running at about 15%. We had said, as we set out back in February, we intend to grow our revenues low single-digit above inflation, and obviously from the numbers Jan took you through just now, you can see that we were able to do that in FY26. We are absolutely looking carefully, though, at maintaining our volume performance as well as protecting our margin integrity.

Jonathan Myers: Yeah. Very good question. Obviously we are reassured by the more benign environment that we have experienced in terms of FX in Nigeria, and we've navigated obviously quite a lot of volatility over the last 2 or 3 years, as well as put in place some guardrails to protect us against ongoing FX devaluation if that rears its head again. Inflation obviously is more of a common reality in emerging markets. Current inflation's running at about 15%. We had said, as we set out back in February, we intend to grow our revenues low single-digit above inflation, and obviously from the numbers Jan took you through just now, you can see that we were able to do that in FY 2026. We are absolutely looking carefully, though, at maintaining our volume performance as well as protecting our margin integrity.

Speaker #2: But inflation, obviously, is more of a common reality in emerging markets. So, current inflation is running at about 15%. We had said, as we set out back in February, that we intend to grow our revenues low single digits above inflation.

Speaker #2: And obviously, from the numbers that Jan took you through just now, you can see that we were able to do that in FY26. We are absolutely looking carefully, though, at maintaining our volume performance as well as protecting our margin integrity.

Speaker #2: And that is an important balance that we want to get right as we look at FY27. So we were already 'anniversarying'—excuse that ugly word—a lot of pricing in the first half of last year.

Jonathan Myers: That is an important balance that we want to get right as we look at FY27. We were already anniversaring, if you excuse that ugly word, a lot of pricing in the H1 of last year. We are being very judicious and forensic in our analysis of how we unlock future price so that we make sure we don't price ourselves out of our competitive set. We're very clear what we want to achieve in the long term, and we have our hands very firmly on the tiller in the short term to ensure the pricing we need to take, we do, but we don't price ourselves beyond the position of competitiveness versus some of the other players in the market.

Jonathan Myers: That is an important balance that we want to get right as we look at FY 2027. We were already anniversaring, if you excuse that ugly word, a lot of pricing in the H1 of last year. We are being very judicious and forensic in our analysis of how we unlock future price so that we make sure we don't price ourselves out of our competitive set. We're very clear what we want to achieve in the long term, and we have our hands very firmly on the tiller in the short term to ensure the pricing we need to take, we do, but we don't price ourselves beyond the position of competitiveness versus some of the other players in the market.

Speaker #2: So we are being very judicious and forensic in our analysis of how we unlock future price, so that we make sure we don't price ourselves out of our competitive set.

Speaker #2: So we're very clear about what we want to achieve in the long term, and we have our hands very firmly on the tiller in the short term.

Speaker #2: To ensure that the pricing we need to take, we do, but that we don't price ourselves beyond the position of competitiveness versus some of the other players in the market.

Speaker #3: Got it. Thank you. And then, sorry, final question. On Indonesia, it sounds like the sort of multi-stage relaunch, or repositioning, or refreshing—whatever we want to call it—of Cussons Baby is now pretty much done.

Matthew Webb: Got it. Thank you. Sorry, final question. On Indonesia, sounds like the sort of multi-stage relaunch of, or repositioning of, or refreshing, whatever we want to call it, of Cussons Baby, is now pretty much done. I just wonder what's next. Are there plans for, I don't know, whether it's expanding that brand into adjacent categories, whether it's thinking about other possible brands for that market. What's the plan going to look like over the next year or so?

Speaker #3: I just wonder, what's next? Are there plans for, whether it's expanding that brand into adjacent categories, or thinking about other possible brands for that market?

Speaker #3: What's the plan going to look like over the next year or so?

Speaker #2: That's a great question, Matthew, because that is exactly the question that we have been working to answer for the last 18 to 24 months, right?

Jonathan Myers: A great question, Matthew, because that is exactly the question that we have been working to answer for the last 18 to 24 months. Right? To some degree, it's all of the above, but I don't want you to think that's a lack of prioritization. There's no doubt job one is strengthening our core. Indeed, we have finished that phased restage. That was literally changing packaging on the very significant number of SKUs that we have in the market that takes quite some time to get through, particularly given some of the long supply chain to East Indonesia and some of the more distant islands. The good news is, as that started hitting the shelves through the last 12 months, we saw a return to share growth that we have sustained through the full year, and that's what's underpinning the double-digit revenue growth on Cussons Baby.

Speaker #2: And to some degree, it's all of the above. But I then want you to think that that's a lack of prioritization. So there's no doubt job one is strengthening our core.

Speaker #2: And indeed, we have finished that phased restaging. That was literally changing packaging on the very significant number of SKUs that we have in the market. That takes quite some time to get through, particularly given some of the long supply chain to East Indonesia and some of the more distant islands.

Speaker #2: And the good news is, as that started hitting the shelf through the last 12 months, we saw a return to share growth that we have sustained through the full year.

Speaker #2: And that's what's underpinning the double-digit revenue growth from Cussons Baby. But we need to carry on investing in that brand, and ensuring it's turning up in a way in which it can win in all channels.

Jonathan Myers: We need to carry on investing in that brand and ensuring it's turning up in a way in which it can win in all channels. Traditional trade, modern trade, or very importantly now, particularly in the cities, in e-commerce. We've given you a few facts to prove that we are making some progress there. We now need to get on with activating, continually recruiting new parents. That is the nature of the category. To some extent, the job is never done on the core. Absolutely our job is then to push up in terms of some of our price tiers in which we operate on Cussons Baby and the launch of SlumberTime and Cuddle Calm, where we took SlumberTime from Childs Farm to put on as Cuddle Calm technology for Cussons Baby.

Speaker #2: Traditional trade, modern trade, or—very importantly now, particularly in the cities—e-commerce. And we've given you a few facts to prove that we are making some progress there.

Speaker #2: But we now need to get on with continually recruiting new parents. That is the nature of the category. So, to some extent, the job is never done on the core.

Speaker #2: But absolutely, our job is then to push up in terms of some of our price tiers in which we operate on Cussons Baby. And the launch of Slumber Time and Cuddle Care, where we took Slumber Time from Charles Farm to put on as Cuddle Care technology for Cussons Baby, that was an example of how we started to nudge up pricing as we moved up the tiers, if you like, from good to better.

Jonathan Myers: That was an example of how we started to nudge up pricing as we moved up the tiers, if you like, from good to better. We also know that we want to play with a second and possibly third brand in Indonesia, and we have activation already in place where Original Source is beginning to get expanded into more distribution points in the modern trade. We're looking at another brand that we will have relaunched and repositioned by the end of FY27. Watch this space.

Speaker #2: But we also know that we want to play with a second and possibly third brand in Indonesia. And we have activation already in place, where Original Source is beginning to get expanded into more distribution points in the modern trade.

Speaker #2: And we're looking at another brand that we will have relaunched and repositioned by the end of FY27, so watch this space.

Speaker #3: Excellent. Thanks, Jonathan. That's all from me.

Matthew Webb: Excellent. Thanks, Jonathan. That's all from me.

Speaker #1: The next question comes from Damien McNeill from Deutsche Bank. Damien, your line is open. Please go ahead.

Operator: The next question comes from Damian McNeela from Deutsche Bank. Damian, your line is open. Please go ahead.

Speaker #4: Thank you. Morning, Jonathan. Morning, Jan. Jonathan, thank you for the reminder—or heads up—about Christmas shopping already. It's always welcome in August. A couple of questions from me, please.

Damian McNeela: Thank you. Morning, Jonathan. Morning, Jan. Jonathan, thank you for the reminder or heads up about Christmas shopping already. That's always welcome in August. A couple for me, please. Jan, in your opening remarks, you talked about you want to bring a focus on improving returns. I was just wondering, can you provide a bit of a sense of how you look at returns? Are you talking about operating margins or are you talking sort of ROCE type, ROIC focus? Is my first question. Second question is on Auto Dishwash in Australia. Now, you've clearly made some good progress in market share gains. I'm just wondering, though, how competitive is that category and what are the medium term outlooks for Morning Fresh Auto Dishwash? Will you continue to need to invest at that level to keep the brand growing? Then last one is on Childs Farm in the US.

Speaker #4: Jan, in your opening remarks, you talked about wanting to bring a focus on improving returns. I just wanted to ask if you could provide a bit of a sense of how you look at returns?

Speaker #4: Are you talking about operating margins, or are you talking about more of a rookie-type ROIC focus? That’s my first question. My second question is on auto dishwashing in Australia.

Speaker #4: Now, you've clearly made some good progress in market share gains. I'm just wondering, though, how competitive is that category? And what are the, sort of, medium-term outlooks for Morning Fresh Auto Dishwash?

Speaker #4: Will you continue to need to invest at that level to keep the brand growing? And then, last one is on Charles Farm in the US.

Speaker #4: Can you just give us some context to what the competitive backdrop for the brand looks like? Whether there are similar products doing something like what we would see in the UK, or are there brands like Charles Farm available out there?

Damian McNeela: Can you just give us some context to what the competitive backdrop for the brand looks like, whether they're similar products or doing something like we would see in the UK or are there brands like Childs Farm available out there?

Speaker #2: Jan, do you want to answer the first question? I'll take the second one as well.

Jonathan Myers: Jan, you want to first answer the first one?

Jan Bramall: Yes.

Jonathan Myers: I'll go to the second to you.

Speaker #4: Perfect. So I think, to answer your question about whether I'm thinking rocky or operating margins—actually, both. The business has been focused on prioritizing investment and looking at the benefits across each of the regions, and really it's just improving on that.

Jan Bramall: Perfect. I think to answer your question about whether I'm thinking ROCE or operating margins, actually both. The business has been focused on prioritizing investment and looking at the benefits across each of the regions, and really it's just improving on that. Whether it's those capital investments and really building some discipline around hurdle rates, understanding the risk and reward in those areas, or whether it's our marketing investment and where we're looking at new product development or product activation, and really thinking about the returns and the risk and where we will make best use of our investments.

Speaker #4: So whether it's those capital investments and really building some discipline around hurdle rates, understanding the risk and reward in those areas, or whether it's our marketing investments and where we're looking at new product development or product activation, and really thinking about the returns and the risk, and where we will make better use of our investments.

Speaker #2: Let me pick up on your other couple of questions first. Oh, sorry, Damien. Go on, Damien.

Jonathan Myers: Let me pick up on your other couple of questions.

Damian McNeela: Can you-

Jonathan Myers: Oh, sorry, Damian. Go on, Damian.

Speaker #4: No, I was just going to ask a follow-up for Jan. I just want to know, do we think in time PZ will provide a sort of a rookie target for the business?

Damian McNeela: No, I was just going to ask a follow-up for Jan. I just wondered, do we think in time PZs will provide a ROCE target for the business?

Speaker #4: Maybe in time. It's a bit early days. I will certainly be looking at it. Yeah. Okay. Thank you.

Jan Bramall: Maybe in time. It's a bit early days. I will certainly be looking at it.

Damian McNeela: Yeah. Okay. Thank you.

Speaker #2: So, Damien, just to reassure you, internet searches for Christmas gift sets start in September, so we're not that early mentioning it now at the beginning of August.

Jonathan Myers: David, just to reassure you, internet searches for Christmas gift sets start in September. We're not that early mentioning it now in the beginning of August. Anyway, put that to one side. Auto Dish. Wow, what a competitive category in Australia. The number one brand have a larger share in Australia than the number one brand in the UK. To give you an idea why I mentioned that, they're a well-established and formidable competitor. They don't have the Morning Fresh equity in manual that we have, nor do they necessarily have the depth of household penetration that we have with our very strong market share. Obviously, Morning Fresh is broadly half the washing up liquid market. We absolutely are proving that we have a right to play and a right to win, but we're also brutally realistic that it will take time.

Speaker #2: But anyway, put that to one side. Right. Auto dish. Wow. What a competitive category in Australia. It has the number one brand is a has a larger share in Australia than the number one brand number one brand in the UK, to give you an idea why I mentioned that there's a well-established and formidable competitor.

Speaker #2: Right? But they don't have the Morning Fresh equity in manual that we have. Nor do they necessarily have the depth of household penetration that we have, with our very strong market share.

Speaker #2: Obviously, Morning Fresh is broadly half the washing-up liquid market. So we absolutely are proving that we have a right to play and a right to win, but we're also, briefly, realistic that it will take time.

Speaker #2: And we have taken our time, but we are glad that we have, because we are now seeing the growth that we reported this morning in terms of share performance, and particularly when we get strong in-store support behind it.

Jonathan Myers: We have taken our time, we are glad that we have, because we are now seeing the growth that we've reported this morning in terms of share performance, and particularly when we get strong in-store support behind it. We're in it for the long term. It's not going to be a sprint, we absolutely see a value in us driving our exposure to the business. The biggest opportunity for us is going to be adding additional SKUs to the range. We have quite a tight SKU today. Over the last few months, we've been looking at what's the right pack size, what's the right number of capsules to have in the pack to win at a certain price point, and then growing the number of distribution points.

Speaker #2: But we're in it for the long term. It's not going to be a sprint, but we absolutely see value in driving our exposure to the business.

Speaker #2: And the biggest opportunity for us is going to be adding additional SKUs to the range. We have quite a tight SKU range today. So, over the last few months, we've been looking at what's the right pack size, what's the right number of capsules to have in the pack to win at a certain price point.

Speaker #2: And then growing the number of distribution points. In a sense, the good news is that we're not yet in full distribution in Australia, and therefore we have quite a lot of runway still to go as we start ticking off more of the major retailers, which still represent white space for us.

Jonathan Myers: In a sense, the good news is that we're not yet in full distribution in Australia, therefore we have quite a lot of runway still to go as we start ticking off more of the major retailers, which still represent white space for us. That's important because the reality is that in value terms over the last 5 years, the Auto Dish category has been growing faster than the manual category. We still want to grow our manual share. There's no reason that we shouldn't be striving to get a 60 or a 65 share, actually also driving exposure to Auto Dish and accepting it's going to be a long-term investment game, with acceptable gross margins, I can reassure you of that. We're totally in it for the long term, we see lots of upside still to go for.

Speaker #2: And that's important because the reality is that, in value terms over the last five years, the auto dish category has been growing faster than the manual category.

Speaker #2: So we still want to grow our manual share. There’s no reason that we shouldn’t be striving to get a 60 or a 65 share.

Speaker #2: But actually, also driving exposure to autodish and accepting it's going to be a long-term investment game. But with acceptable gross margins, I can reassure you of that—we're totally in it for the long term, and we see lots of upside still to go for.

Speaker #2: So that's the answer on auto dish in Australia. Let me just touch on the baby and kids categories in the US. I was over about three weeks ago, actually walking the stores, and we walked many stores with the executives of the Emerson Group to really see how they're doing with Saint-Tropez and Charles Farm.

Jonathan Myers: That's the answer on Auto Dish in Australia. Let me just touch on the baby and kids categories in the US. I was over about 3 weeks ago, actually walking the stores, we walked many stores with the executives of the Emerson Group to really see how they're doing with Sanitop and Childs Farm, to make sure I could kind of kick the tires on what they were doing for us, also see what the market's doing. The reality is, even though the category is reasonably well developed in the US, it is not well developed in the underserved or overlooked niche of real sensitive needs skincare, delivered in a fun and enjoyable, colorful, maybe even quirky way, rather than overly clinical or very much the boring white packaging that you would predict in a kind of a pharmacy channel.

Speaker #2: And to make sure I could kind of kick the tires on what they were doing for us, and also see what the market's doing.

Speaker #2: And the reality is, even though the category is reasonably well developed, in the US it is not well developed in the underserved or overlooked niche of real, sensitive-need skincare—but delivered in a fun and enjoyable, colorful, maybe even quirky way, rather than overly clinical or very much the boring white packaging that you would predict in a kind of pharmacy channel.

Speaker #2: So actually, we think that the fun, believably kind positioning—excuse the cheesy word there, right?—but the fun, believably kind positioning of Charles Farm has lots of potential in the US.

Jonathan Myers: Actually, we think that the fun, believably kind positioning, excuse the cheesy word there. The fun, believably kind positioning of Childs Farm has lots of potential in the US, and that's one of the reasons why the Walmart buyer has got behind it. Now, as I said, we're very sanguine about the challenge. It'll be a bit like Auto Dish in Australia. We will have to earn our distribution. We will have to defend that distribution, and then over time, potentially expand it. Our job right now is to get out recruiting new parents in the US who are concerned about their kids having sensitive skin but also want to have some fun at bath time. That's really what we're setting about doing right now.

Speaker #2: And that's one of the reasons why the Walmart buyer has got behind it. Now, as I said, we're very sanguine about the challenge. It'll be a bit like Auto Dish in Australia.

Speaker #2: We will have to earn our distribution. We will have to defend that distribution, and then, over time, potentially expand it. But our job right now is to get out, recruiting new parents in the US who are concerned about their kids having sensitive skin but also want to have some fun at bath time.

Speaker #2: And that's really what we're setting about doing right now.

Speaker #4: Okay. Thank you very clear.

Damian McNeela: Okay. Thank you. Very clear.

Speaker #2: Very good.

Jonathan Myers: Very good.

Speaker #4: Just a reminder, if you'd like to ask a question on today's call, please use the dial-in details to the left of the slides and press star followed by one.

Operator: As a reminder, if you'd like to ask a question on today's call, please use the dialing details to the left of the slides and press star followed by one once you are connected. The next question comes from Sahill Shan from Singer Capital Markets. Sahill, your line is open. Please go ahead.

Speaker #4: Once you are connected, the next question comes from Sahil Shan from Singer Capital Markets. Sahil, your line is open. Please go ahead.

Speaker #5: Thank you. Morning, everybody. I've got a few questions. I'm going to sort of do these one by one, if that's okay. So, Jan, for you, very interesting slide on Nigerian liabilities for the simpleton like me.

Sahill Shan: Thank you. Morning, everybody. I've got a few questions. I'm going to sort of do these one by one, if that's okay. Jan, for you, very interesting slide on Nigerian liabilities. For a simpleton like me, could you just explain these intercompany liabilities and the drop from GBP 140 million to GBP 30 million? Where's that drop coming from, and how should we be looking at this going forward?

Speaker #5: Could you just explain these intercompany liabilities and the drop from $140 million to $30 million? Where's that drop coming from, and how should we be looking at this going forward?

Speaker #4: Yes, okay. So, there are a number of different things within those dollar liabilities—from intercompany recharges, to the actual liabilities within the company from its cost of sales, quasi-equity loans, and a number of different elements.

Jan Bramall: Yes. Okay. There are a number of different things within those USD liabilities, from intercompany recharges to the actual liabilities within the company, from its cost of sales, quasi equity loans, and a number of different elements. What we've been doing over the past two and made significant progress over the last year is reducing those USD liabilities that are held in the Nigerian business. If there were to be a devaluation in those USD liabilities, then effectively that increases the cost of sales in the local business, which hits our operating profit. Roughly speaking now, if there were NGN 100 movement on that $30 million liability, that would give us a GBP 1.5 million hit to our P&L. It's a number of different elements as well as kind of settling loans and all of those things to remove those liabilities.

Speaker #4: And what we've been doing over the past two years, and made significant progress over the last year, is reducing those dollar liabilities that are held in the Nigerian business.

Speaker #4: So, if there were to be a devaluation in those dollar liabilities, then effectively that increases the cost of sales in the local business, which hits our operating profit.

Speaker #4: So, roughly speaking now, if there were a 100 basis point IRO movement on that $30 million liability, that would give us a $1.5 million hit to our P&L.

Speaker #4: So it's a number of different elements, as well as settling loans and all of those things, to remove those liabilities.

Speaker #5: Thank you. Second question is around marketing spend. I think I read or heard it's up 10% year-on-year. But I noticed UK growth was still soft.

Sahill Shan: Thank you. Second question is around marketing spend. I think I read or heard it's up 10% year on year. I noticed UK growth was still soft and the main driver seems to be a couple of brands in there. What gives you confidence that incremental spend is converting into UK growth next year rather than just defending market share?

Speaker #5: And the main driver seems to be a couple of brands in there. So what gives you confidence that the incremental spend is converting into UK growth next year, rather than just defending market share?

Speaker #2: Sahil, why don't I pick that up? You're absolutely right. We grew marketing spend by double digits. We have invested at record levels in recent years.

Jonathan Myers: Sahill, what I pick up, you're absolutely right. We grew marketing spend double digits. We have invested at record levels for recent years. I think it is worth absolutely noting, not only was that trying to ensure that where we were confident of a return investment, that we were investing at sufficient levels to be competitive, and that varied by given categories and countries. We were also investing what we call incubator funds into planting seeds for future growth as we were developing maybe new campaigns that we're activating this year or even more importantly, new innovation that we're qualifying to bring as we look out one year, two years, or even three years. Our marketing money needs to work for us in more than just being able to deliver in year.

Speaker #2: I think it is absolutely worth noting, not only was that trying to ensure that where we were confident of a return on investment, we were investing at sufficient levels to be competitive.

Speaker #2: And that varies by given categories and countries. We were also investing what we call incubator funds into planting seeds for future growth, as we were developing, maybe, new campaigns that were activating this year or even, more importantly, new innovation that we're qualifying to bring as we look at—whether we've got one year, two years, or even three years ahead.

Speaker #2: So our marketing money needs to work for us in more than just being able to deliver in-year. So if I just look at the European numbers, and within that, the UK—but allow me just to concentrate a little bit on Europe, including the UK.

Jonathan Myers: If I just look at the European numbers and within that the UK, allow me just to concentrate a little bit on Europe, including the UK. We absolutely saw growth in our washing and bathing. We absolutely saw growth overall. However, there were two areas where we didn't see growth. Some of that was intentional and some of that was faster than anticipated, requiring us to take some interventions. Where it was intentional is where we have pulled back on some smaller markets in Europe, as we have done, by the way, in Southeast Asia as well, where the business was either unprofitable or not very profitable. Equally, we have also pulled back on some of our smaller brands, which is the opposite of focusing on the lead markets and the top 10 brands. Obviously, that can lead to a conscious deprioritization in other places.

Speaker #2: We absolutely saw growth in our Wash & Bathing category. We absolutely saw growth overall. However, there were two areas where we didn't see growth. Some of that was intentional, and some of that was faster than anticipated, requiring us to take some interventions.

Speaker #2: So, where it was intentional is where we have pulled back on some smaller markets in Europe, as we have done, by the way, in Southeast Asia as well, where the business was either unprofitable or not very profitable.

Speaker #2: And equally, we have also pulled back on some of our smaller brands, which is the opposite of focusing on the lead markets and the top 10 brands.

Speaker #2: Obviously, that can lead to a conscious deprioritization in other places. What that has meant is that, in some areas, we've seen either some trimmed distribution, or we may have seen very strong shipments in year one, where we got new distribution, and we obviously didn't have that pipeline effect in year two.

Jonathan Myers: What that has meant, that in some places we've seen either some trimmed distribution or we may have seen very strong shipments in year one where we got new distribution, and we obviously didn't have that pipeline effect in year two. What it does mean is that we need to sharpen our pencil on some of our tail brands and make sure we're all overprotecting, that if they are going to decline and we're okay with that, then we do that in a forecast and managed way. Or if we're not okay with it, and there are some where we're not okay, right, guys, what are we going to do to get motoring again? That's very much what we're working on. We don't want that work to distract from absolutely growing the core, which is the biggest brands in our lead markets.

Speaker #2: But what it does mean is that we need to sharpen our pencil on some of our tail brands and make sure we're all over protecting that. If they are going to decline and we're okay with that, then we do that in a forecasted and managed way.

Speaker #2: Or if we're not okay with it—and there are some where we're not okay—right, guys? What are we going to do to get motoring again?

Speaker #2: And that's very much what we're working on. But we don't want that work to distract from the biggest brands in our lead markets. And that's why it's a quid pro quo of growth in four lead markets and top 10 brands—that there will be some casualties.

Jonathan Myers: That's why it's a quid pro quo of growth in four lead markets and top 10 brands that there will be some casualties. We just need to make sure they're not unintended casualties, and that's where we are, as I say, doing some work.

Speaker #2: We just need to make sure they're not unintended casualties. And that's where we are, as I say, doing some work.

Speaker #5: Yeah, can I just follow up on that, Jonathan, if that's okay? So is there any way you can disaggregate how the top 10 brands performed in the UK?

Sahill Shan: Yeah. Can I just follow up on that, Jonathan, if that's okay? Is there any way you can disaggregate how the top 10 brands performed in the UK? Because I see that 0.5% growth in the UK, and I'm just thinking that's a soft number. Then you talk about market share gains. I'm just trying to reconcile that.

Speaker #5: Because I see that’s not even half a percent growth in the UK, and I’m just thinking that’s a soft number. And then you talk about market share gains.

Speaker #5: I'm just trying to reconcile that.

Speaker #2: So, I'm very happy to do some disaggregation with you after the event, Sahil, when we get to catch up. But essentially, what we've got are very competitive markets where we are growing revenue, but we also need to try and make sure we're maintaining healthy volumes as well.

Jonathan Myers: I'm very happy to do some disaggregation with you after the event, Sahill, when we get to catch up.

Sahill Shan: Yeah.

Jonathan Myers: Essentially what we've got is very competitive markets where we are growing revenue, but we also need to try and make sure we're maintaining healthy volumes as well. The reality is we're up against some very significant competitors in wash and bathing in the UK, some of whom may have either more price-led strategies or more volume-led strategies. We're making sure that our plans are sufficient to win against them whilst delivering our financial ambitions. What really matters is, are we growing our biggest brands in our biggest markets? The answer is yes. We're very happy to follow up with you afterwards on maybe some of the moving parts.

Speaker #2: And the reality is, we're up against some very significant competitors in washing and bathing in the UK, some of whom may have either more price-led strategies or more volume-led strategies.

Speaker #2: So we're making sure that our plans are sufficient to win against them, whilst delivering our financial ambitions. But what really matters is: are we growing our biggest brands in our biggest markets?

Speaker #2: The answer is yes. We're very happy to follow up with you afterwards on maybe some of the moving parts.

Speaker #5: Okay, so my next question is slightly related to this. Again, marketing spend has increased—I understand the rationale for that. There's been a bit of FX headwind in Asia Pacific as well.

Sahill Shan: Okay. My next question is slightly related to this. Again, marketing spend has increased. I understand the rationale for that. There's been a bit of FX headwind in the Asia Pacific as well, but when I look at margins both in UK, Europe, and Americas and out in Asia Pacific, they're either flat or they sort of come down. How should we be thinking about margins going forward? Is the UK likely to sort of drift even further as you invest more? As far as Asia Pacific is concerned, what's the guidance? What's the thinking? Is there any chance of them inflecting in 2027?

Speaker #5: But when I look at margins, both in the UK, Europe, and Americas, and out in Asia-Pacific, they're either flat or have come down. How should we be thinking about—sorry—margins going forward?

Speaker #5: Is the UK likely to sort of drift even further as you invest more? And as far as Asia Pacific's concerned, what's the guidance? What's the thinking?

Speaker #5: Is there any chance of them inflecting in 2027?

Speaker #2: Yeah, so there are a few ways to tackle that one, Sahil. But if I take a step back, one of the really important deliverables from last year that we set out to achieve was a significant reduction in our cost base.

Jonathan Myers: There are a few ways to tackle that one, Sahill. If I take a step back, one of the really important deliverables from last year that we set out to achieve was a significant reduction in our cost base. As you see, we have reported a GBP 8.5 million savings number. Most of that fell in the center. There were other savings elsewhere in the regions, but much of that was reinvested in other ways, sometimes in sharpening our capabilities as well. What the savings in the center enabled us to do was to then spend the marketing investment in the regional P&Ls. That's why you see some of the pressure on the regional P&L, the operating margins that you're referring to, whereas at the group level, we were able to grow overall operating margin.

Speaker #2: And as you see, we have reported an £8.5 million savings number. Most of that fell in the center. There were other savings elsewhere in the regions, but much of that was reinvested in other ways, sometimes in sharpening our capabilities as well.

Speaker #2: And what the savings in the center enabled us to do was to then spend the marketing investment in the regional P&Ls. And that's why you see some of the pressure on the regional P&Ls, the operating margins that you're referring to, whereas as a group level, we were able to grow overall operating margins.

Speaker #2: So there's a slight dynamic there going on between intentional and very rigorous savings discipline and cost discipline in the center, enabling us to get on the front foot in the markets.

Jonathan Myers: There's a slight dynamic there going on between intentional and very rigorous savings discipline and cost discipline in the center enabling us to get on the front foot in the market. That's one where I'd ask you to see the numbers in the aggregate rather than necessarily across the region-by-region P&L. Having said that, our absolute intention is that over time, our regions are going to grow their margins because they are ultimately driving volume and improving their gross margin. If we get both of those right, we'll have enough oxygen in the P&L to invest in marketing and still flow to operating margin, and we'll always keep a careful eye on cost discipline in the center as well.

Speaker #2: So that's one where I'd ask you to see the numbers in the aggregate, rather than necessarily across the region-by-region P&Ls. But having said that, our absolute intention is that, over time, our regions are going to grow their margins, because they are ultimately driving volume and improving their gross margin.

Speaker #2: And if we get both of those right, we'll have enough oxygen in the P&L to invest in marketing and still flow it to operating margin.

Speaker #2: And we’ll always keep a careful eye on cost discipline in the center as well.

Speaker #5: Okay, thank you for that. I'll pick that up with you later as well. The next question is around the write-downs in Charles Worthington and Fudge.

Sahill Shan: Yeah. Thank you for that. I'll pick it up with you later as well. The next question is around the writedowns in Charles Worthington and Fudge. Underperforming categories by the sounds of it. Are they now both subscale distractions that you'd consider exiting or divesting?

Speaker #5: Underperforming categories, by the sounds of it—are they now both subscale distractions that you'd consider exiting or divesting?

Speaker #3: So I think, as you say, we've had to actually impair those brands because the growth isn't what we needed it to be. As Jonathan actually said, we need to now look at whether we should be investing in those brands, or if it's acceptable for them to be relatively flat while we focus on our top 10 brands, or our top key brands, in those markets.

Jan Bramall: I think as you say, we've had to actually impair those brands because the growth isn't what we needed it to be. As Jonathan actually said, we need to now look, should we be investing in those brands or is it acceptable for them to be relatively flat where we focus on our top 10 brands or our top key brands in those markets? Obviously we didn't want to kind of see that performance, but yeah, we're looking at some of those areas.

Speaker #3: So, obviously, we didn't want to kind of see that performance. But yeah, we're looking at some of those areas.

Speaker #5: Got it. Okay.

Sahill Shan: Got it. Okay.

Speaker #2: Satisfy. Ooh, go on, Sahil. We're right at the limit of time. If you've got one last quick one, otherwise.

Jonathan Myers: Perhaps if I could-- Oops. Go on, Sah. We're right at the limit of time. If you've got one last quick one, I've got one.

Sahill Shan: Yeah, final one. Sorry. Just being a bit anal here. There's a significant working capital swing outflow. Just a bit of color on that would be helpful.

Speaker #5: Yeah, final one. Sorry, just being a bit in earlier. There's a significant working capital swing outflow. Just a bit of colour on that would be helpful.

Speaker #3: Yeah, so it's a combination of two things. One is actually the debt in Australia last year. We had some cash inflows on some financing of the debt.

Jan Bramall: Yeah, it's a combination of two things. One is actually the debt in Australia last year. We had some cash inflows on some financing of the debt. A lot of it is just getting ahead on purchases because of the impact of Iran, really trying to protect the inventory there. That was the other main element of the GBP 9 million outflow that you'll be referring to.

Speaker #3: But a lot of it is just getting ahead on purchases because of the impact of Iran—they're really trying to protect the inventory there. So that was the other main element of the £9 million outflow that you'll be referring to.

Speaker #2: Very well said, Jan. So, perhaps if I can wrap it up, we're just over the hour. I want to thank you all for joining today.

Jonathan Myers: Very well said, Jan. Perhaps if I can wrap it up, we're just over the hour. I want to thank you all for joining today. I know we'll have some conversations with some of you in the coming days, and we look forward to those. We will update you on progress as we see appropriate through the year. We look forward to doing that. Meanwhile, I'm sure many of you are off on summer holiday. I wish you a lovely holiday, and as you dash to the airport, please pick up Childs Farm sun care for you and the kids and help our revenues. Thank you very much.

Speaker #2: I know we'll have some conversations with some of you in the coming days, and we look forward to those. We will update you on progress as we see appropriate throughout the year.

Speaker #2: So we look forward to doing that. Meanwhile, I'm sure many of you are off on summer holiday. I wish you a lovely holiday, and as you dash to the airport, please pick up Charles Farm sun care for you and the kids.

Speaker #2: And help our revenues. So, thank you very much.

Operator: This concludes today's call. Thank you very much for your attendance. You may now disconnect your lines.

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Q4 2026 PZ Cussons PLC Earnings Call

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