Unilever Indonesia Earns IDR 3.4 Trillion Net Profit In 2024, Drops 29.8 Percent

JAKARTA - PT Unilever Indonesia, Tbk (UNVR) recorded a net profit throughout 2024 of IDR 3.4 trillion, down 29.8 percent year on year (yoy) when compared to 2023 of IDR 4.8 trillion.

However, UNVR's net sales throughout 2024 amounted to IDR 35.13 trillion, down 9 percent when compared to 2023 of IDR 38.61 trillion.

President Director of Unilever Indonesia Benjie Yap said the decline in net profit was 29.8 percent compared to the previous year due to the decline in sales and the increase in investment needed in transformation.

On the other hand, Benjie explained that the company is focusing on transforming its business and organization, and recently obtained approval from shareholders to divest the Ice Cream business.

"These strategic steps underscore the Company's commitment to strengthening its position in the market and encouraging sustainable long-term growth," he said in his statement, Thursday, February 13.

Benjie emphasized that throughout 2024, his party will take firm and courageous action to deal with the main problems as much as possible.

"Although these various efforts have an impact on short-term performance, these steps have succeeded in strengthening our business fundamentals," he said.

Benjie emphasized that various actions to reset or reorganize the business that his party is doing will ease costs and encourage growth.

"We are starting to see progress and we believe these efforts will build a stronger foundation for long-term growth," he said.

He explained that his party's top priority includes sharpening focus on areas with high potential; aligning organizations while building strong and capable talents in their fields such as sharpening brand advantages and continuing to improve operational efficiency and implementation.

According to him, by ensuring the implementation of an effective strategy and providing measurable results, we position our business for long-term success.

"With careful planning and targeted efforts, we believe that the Company can face challenges and build a stronger future," he added.

It is known that domestic sales are corrected by 8.7 percent year-on-year due to negative Underlying Price Growth (UPG) growth by 3.6 percent and negative Volume Growth (UVG) growth by 5.2 percent.

In addition, full-year sales are significantly influenced by various firm and courageous efforts, which aim to address operational problems in order to prioritize long-term growth.

Meanwhile, the gross profit margin was 47.6 percent, corrected by 213 bps compared to the previous year as a result of the cost of transforming and reducing customer stock. This is because there is an improvement in market share during 2024 compared to the lowest position in December 2023, although it is still below the market share position year to date in October 2023.

Then, launch and relay 46 innovations to strengthen brands and portfolios and take advantage of the growing consumer segment.

Benjie said that the company's healthy distributive trade has strengthened the distribution channel as part of the transformation being carried out.

According to him, until now, this transformation has succeeded in reducing stock in distributors by around 50 percent compared to the level in 2021, reaching the lowest stock level for more than 10 years and having a good impact on increasing growth and Company profits.

"The company managed to achieve zero overdue (zero delay) from DT (Distributive Trade) partners and implemented a consistent and transparent price structure across the market," he said.

Benjie said the company recorded a healthy gross profit margin of 47.6 percent, supported by a strong cost reset program in the operational aspect.

According to him, this includes a major transformation carried out in factories as well as productivity initiatives for non-factories-based ones. Maintaining margins is very important to position business for profitability and long-term sustainability, ensuring sustainable success in the increasingly competitive FMCG market.

Benjie said that in the future the company remains committed to long-term and sustainable growth compared to short-term performance, and will continue to take firm action to overcome various operational problems.

"Continuing the progress that has been achieved in 2024, the Company will continue the transformation of Go-To-Market in 2025 including expanding the range of direct and indirect distributions, and ensuring smooth executions in the market," he added.

Benjie conveyed that the increase in gross profit margins was through operational efficiency and increased volume.

According to him, in building stronger brands and portfolios and continuing to invest behind brands to ensure that all brands remain competitive and relevant.

Benjie explained that because these efforts would provide a stronger foundation for long-term growth, the Company anticipates that it will see the benefits of the reset action in the second half of 2025.