On March 19, 2024, Unilever PLC announced its plan to separate its Ice-cream business through a spin-off, in a move to accelerate its Growth Action Plan (GAP). Post separation, Unilever will focus on four business units: Beauty & Wellbeing, Personal Care, Home Care, and Nutrition, while the NewCo will operate as a world-leading Ice-cream business. The company aims to achieve cost savings of €800 million over the next three years through this separation process, which is expected to be completed by the end of 2025.
Unilever has indicated its intention to explore various avenues for the separation, with a demerger emerging as the probable route. The Ice-cream business will be headquartered in Amsterdam, and a new leadership team led by Peter ter Kulve has been established to enhance operational control and productivity. Under the Growth Action Plan (GAP) introduced in October 2023, Unilever aims to deliver higher quality growth, stepping up productivity and simplicity, and adopting a strong performance focus.
Unilever’s Ice-cream business operates on a global scale with brands like Ben & Jerry’s, Cornetto, and Magnum, boasting a dominant position in the €80 billion global Ice Cream market with a 20% market share. However, the Ice-cream sales fell short of expectations in FY23, leading to the decision to separate the business. The separation will allow Unilever to focus on its top 30 brands, with projections indicating accelerated growth and improved profit margins by 2026.
In its recent 4Q23 and FY23 results, Unilever reported mixed performance across its Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream divisions. Total sales declined due to currency fluctuations, but underlying sales grew, driven by price increases and volume rises. Geographically, sales in the Asia Pacific Africa region were adversely impacted, while The Americas region saw growth. Unilever has optimized its portfolio by discontinuing various brands and reducing active SKUs across its divisions.
Unilever’s Beauty & Wellbeing division focuses on haircare, skincare, and premium beauty items, while the Personal Care division offers deodorants, soaps, and oral care products. The Home Care segment includes cleaning products like laundry detergents and fabric conditioners, and the Nutrition division offers food products such as savory spreads and cooking aids. Innovation is critical for Unilever’s Ice Cream segment, which offers a range of frozen desserts with popular brands like Magnum and Ben & Jerry’s.
Founded in 1860, Unilever PLC is a global FMCG manufacturer with a wide range of products sold in over 190 countries. The company’s diverse product portfolio includes well-known brands such as Dove, Hellmann’s, Lipton, and Ben & Jerry’s. Unilever’s decision to spin off its Ice-cream business aligns with its strategy to focus on its top-performing brands, streamline its portfolio, and drive growth and profitability. The company is optimistic about the prospects of its remaining business units post-separation and anticipates a positive impact on its financial performance in the coming years.
