GOOD PERFORMANCE CONTINUES IN A CHALLENGING ENVIRONMENT. OUTLOOK CONFIRMED.
Financial Highlights of the Half Year
• Underlying sales growth of 7.0% in the first half year.
• Operating margin of 16.0% in the first half year, with an underlying improvement of 0.4 percentage points.
• Earnings per share up by 6%, or 12% at constant exchange rates. The first quarter benefited from disposal
profits, while the second quarter was affected by higher restructuring charges and a particularly low tax rate last
year.
Operational Highlights
• Broad-based growth in every category.
• Continued strong growth in Developing and Emerging (D&E) countries from both volume and pricing.
• Price-driven growth in Western Europe and North America.
• Cost increases recovered through determined pricing action and accelerating savings. Efficiency programmes on
track to deliver €1 billion of savings this year.
• Further significant progress with disposal programme, including Bertolli olive oil and North American laundry.

GROUP CHIEF EXECUTIVE
“Our performance in the first half year has been good in what has been a challenging environment. We have delivered 7% underlying sales growth and an underlying improvement in profitability while maintaining competitiveness. The changes already implemented in the business have made us nimbler and better able to respond to the market conditions. We are doing so against our clear priorities of maintaining competitiveness, improving margins and investing selectively to gain market share.
Looking to the future, our strategy leverages our strong brands, broad geographic footprint and products that meet everyday needs across a wide range of price points. Our innovation programme focuses on opportunities in health
and wellness, the use of superior technology, and rapid deployment into new markets. This continues to be the best route to long-term value creation.
For this year we confirm our outlook for delivering growth ahead of our 3-5% target range, with an underlying improvement in operating margin.”
Patrick Cescau, Group Chief Executive

SUMMARY OF BUSINESS PERFORMANCE FOR THE SECOND QUARTER AND FIRST HALF YEAR
Underlying sales growth was 6.8% in the second quarter, taking the half year rate to 7.0%. Prices increased by 7.4% in the second quarter and by 6.1% in the first half year.
Europe grew by 2.3% in both the quarter and the half year. All of the growth has come from pricing, with volumes 2.9% lower in the second quarter. The lower volumes largely reflect weaker ice cream sales and the expected
reversal of the additional sales at the end of the first quarter ahead of price increases and systems implementations.
The Americas has sustained its momentum with growth of 5.7% in the first half year. This was achieved against a strong comparator which included the impact of additional sales ahead of the systems change in the US in June last
year. In Latin America growth accelerated in both value and volume including a good performance in Brazil.
Growth in Asia Africa picked up further to 15.1% in the second quarter and is broad-based across countries with double-digit increases almost everywhere. In addition to pricing, volume growth was robust at 4.1% in the second
quarter.
At a global level, all categories grew by more than 5% in the first half year.
Advertising investment behind our brands was increased by some €100 million at constant rates of exchange in the first half year. With the benefit of higher sales, media efficiency programmes and fewer promotions, A&P as a
percentage of sales was 0.7 points lower in the second quarter and 0.4 points lower in the first half year.
Commodity costs increased by around €600 million in the second quarter and by around €1 billion in the first half.
This is equivalent to 5.5 percentage points of sales in the quarter and 4.8 percentage points in the first half. Both price increases and savings from cost reduction programmes accelerated in the second quarter. As a result we were able to deliver an underlying improvement in operating margin of 0.5 percentage points in the quarter, taking the first half year improvement to 0.4 percentage points.
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