Haleon (HLN) Q1 2025 TU earnings summary

Executive summary

• Q1 2025 organic revenue grew 3.5% year-over-year, driven by 2.4% price and 1.1% volume/mix, with broad-based growth across categories and regions despite macroeconomic challenges.

• Emerging markets performed strongly, up 6.5%, with India and China showing double-digit growth in Sensodyne.

• Innovation and successful launches, such as Voltaren 2% and new Sensodyne and Otrivin products, supported growth.

• Reported revenue declined 2.3% year-over-year, mainly due to FX and divestments.

• Capital allocation priorities advanced with share buybacks and full ownership of China OTC JV.

Financial highlights

• Q1 2025 revenue was £2.9 billion, reflecting 3.5% organic growth; reported revenue declined 2.3% due to FX and disposals.

• Net M&A diluted revenue by 2.9% due to divestments (ChapStick, NRT outside US); FX impact was -2.9%.

• Segment organic growth: Oral Health 6.6%, VMS 0.9%, Pain Relief 2.6%, Respiratory Health 1.7%, Digestive Health & Other 3.0%.

• North America organic revenue up 1.0%; EMEA & LATAM up 5.0%; APAC up 4.2%.

• VMS revenues grew 9.9% in some regions, but were broadly flat in the US, with Centrum down double digits.

Outlook and guidance

• FY 2025 organic revenue growth expected at 4-6%, with organic operating profit growth anticipated to exceed revenue growth.

• Growth expected to be weighted toward the second half of 2025, supported by innovation launches and normalized cold/flu season.

• Net M&A expected to dilute FY 2025 revenue by ~2% and adjusted operating profit by ~5.5%.

• FX headwind for 2025 estimated at ~2% on revenue and ~3% on adjusted operating profit.

• Net interest cost projected at ~£270m; tax rate at ~24%; non-controlling interest charge at ~£15m.