Playing to WinUnilever Supply Chain

Pier Luigi SigismondiChief Supply Chain Officer

2

The Recent Past ...

3

A Cost Driven Supply Chain …

678717

810

2006 2007 2008

SteadySC SavingsSC Savings

€€’mil’mil

ContinuousRestructuringRestructuring

18 1714

2006 2007 2008

# sites# sitesclosedclosed

17%17%17%16%

21%

23%

Best in ClassFixed AssetsFixed AssetsProductivityProductivity

1999 2003 2009

FA%TO

4

With many Pockets of Excellence …

Regional ScaleRegional Scale

Efficiency

CompetitiveConversion CostConversion Cost*

100

91 90

Ind av. Best UL

Great PeoplePeoplewith Rigour &

Discipline

*2008 McKinsey benchmarking study

SustainabilityPrograms

BestPractices

PerformanceCulture LeanLean

Structure*100

70 67

Ind av. Best UL

SC IndirectsSC IndirectsIndexIndex

5

But not Winning the game …

Gross MarginsGross Margins

2005 2006 2007 2008

Inventory DaysInventory Days

64 6464

6768

Q4

06

Q2

07

Q4

07

Q2

08

Q4

08

19.6 20.0 20.019.1

2005 2006 2007 2008

VolumesVolumes

€€’Mil Tonnes’Mil Tonnes

6

A fundamental Change required …

7

I. Restored Robust Foundations …

8

Renewed Focus on Quality …

--52%52% YTD reductionon Product IncidentsProduct Incidents

--10%10% YTD reduction

on Consumer ComplaintsConsumer Complaints

Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10

CarelineCareline

9

Stepped up Cost Savings …

ImprovedImprovedGross MarginGross Margin

2009 2010

SC SavingsSC Savingsoffsetting InputInput

cost increasecost increase

ReRe--investinvestin A&Pto fuelgrowthgrowth

CentralisedCentralisedCommodity RiskCommodity RiskManagement …Management …

0.70.7

0.8

1.1

2006 2007 2008 2009 2010

€€1+ bn1+ bnSC SavingsSC Savings

+1

10

Increased Customer focus …

+510bps+510bpsOOn SShelf AAvailability

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10

6 Consecutive6 ConsecutiveQuartersQuarters

Best SupplierBest Supplierof our Customers

Example: Customers Recognition

#1

#1

#1 #1

#1

#1

#1

#2

#2

#2

#3#4

#1

#3

11

#1

#2

#3

#4#3

12

Sustained Cash Delivery

improvements…

ContinuedNegativeNegative TWCTWC

-5%

0%

5%

Q109

Q409

Q310

Q210

Q110

Q309

Q209

Q109

Q409

Q310

Q210

Q110

Q309

Q209

Q109

Q409

Q310

Q210

Q110

Q309

Q209

MAT TWC%TOClosing TWC%TO

- 7 DebtorsDays

++ 1111Creditors Days

- 99 StocksDays

54

56

58

60

62

64

66

68

70

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10

70

72

74

76

78

80

82

84

86

88

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10

30

32

34

36

38

40

42

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10

13

II. A new Inter-dependent team

14

Simplified our Structure …

From:Just HPC &&

FOODS

To:8 CATEGORIES8 CATEGORIESSC UnitsSC Units with

Depth andFocus

LeanLean Structure

CSCOCSCO

ONE GlobalONE GlobalSC Org.

1717 direct reportsdirect reports

GeographyGeographyVPsVPs

CategoryCategoryVPsVPs

NewNewLeadership

Team

FactoryFactoryDirectorDirector

15

Global capabilities: Examples …

IInntteerrddeeppeenndedentntGGlobal Nelobal Nettwwoorrkk

ManufacturingExcellence

Led by AmericasLed by Americas

Global VirtualSites

EngineeringExcellenceLed by AACLed by AAC

Deliver Repeatable ModelsFor E2E Capital Project

LogisticsExcellence

Led by EuropeLed by Europe•Cost

•Carbon

•Service

16

Global capabilities: Examples …

Customer ServiceCustomer ServiceExcellenceExcellence

Go to MarketGo to MarketSC teamsSC teams

Repository ofBest Practices

FasterRollout of

BPs

17

The Journey ahead …

18

Exciting growth agenda …

30+30+new plants

by 2015

Significantvolumeincrease

€€5bn5bn Capexin

next 3 years

2006 2008 2010 2012

Fixed AssetsFixed Assets

towardstowards D&ED&E …

SustainingBest in Class

AssetAssetProductivityProductivity

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In a volatile and tough environment

FierceCompetitionCompetition SoftSoft

Economies

-2%

0%

2%

4%

6%

W Europe

N America

2009 2010

-2%

0%

2%

4%

6%

W Europe

N America

2009 20102009 2010

0%

4%

8%

12%

16%

20%

Asia

LatAm

CEE

AMET

2009 2010

0%

4%

8%

12%

16%

20%

Asia

LatAm

CEE

AMET

2009 20102009 2010

DevelopedMarkets

D&EMarkets

VolatileVolatileCommodities

20

We will WIN differently …

Lean, Responsive and Consumer led Value ChainValue Chain

Accountability &Responsibility

Building Talent& Teams

Bias for Action

Growth Mindset

Consumer &Customer Focus

Worldclass

service

End-to-endcompetitive

cost

Consumerperceived

quality

Flawlessexecution

Flexible,agile &

leanstructures

End-to-endcompetitive

cost SC createsvalue

through

21

Quality Excellence …

protectenvironment

socialprogress

economicgrowthIntegrated

Quality CultureCulture

DESIGN DELIVER

ProductSuperiority

ConsumerConsumerRelevant Quality

Standards

22

Route to market Excellence …

2010

1 Mil1 Mil

5 Mil5 Mil

2020

CustomerCollaborationsCollaborationsOOn SShelf

AAvailability

OSA 5OSA 5StepsSteps

ModernTrade

Route toMarket via

5,5005,500DistributorsDistributors

More & BetterMore & BetterServedServed StoresStores

GeneralTrade

from 1 million (2010) to 5 million (2020)

GT MT

More stores… better stores… better served

“Perfect Stores”: D&E ambition

23

24

E2E Competitive Cost Excellence …

First TimeFirst TimeRight Cost& Quality

TargetCosting

Low CostLow CostBusiness Model

SimplificationSimplification

- 20%SKUs

- 30%Materials

- 30%Formulas

€€26bn26bnBuyingScale

R&D

MKT

SC

MultiMulti--functionalfunctionalsavings initiativessavings initiatives

Sustainsignificant

Savings

BlendFlexBlendFlex

Formula Substitution

TM

Example: Pureit for Latam

64 19 83

65 19 46

From

To

Cost

TargetCost

GrossProfit

Priceper ltr

TargetPrice

TargetGP

GM 40%

GM 49%

- 28% costdifferential

83

48

19

24

11

23

Co

nsu

mer

Pri

ce

Turn

ove

r

Co

sts

Gro

ssP

rofi

t

Example: Aerosols opportunity

Value Chain benefits now available to many other starter markets

Today Future

Coster(Turkey 14M)

Thai Daizo18M

AeroEgypt

2M

India Site(65-100m cansfrom ’13 to ’15)

Today Future

Co-makers (illustrative)

India

27

Long-term sustainable operations …

*by 2020 vs 1995 baseline per ton of production

** by 2020 vs 2010 baseline

Green FactoriesGreen Factories

--63%*63%* --80%*80%* --78%*78%*

WaterNeutral

SustainableSustainableLogisticsLogistics

--40% CO2**40% CO2**

SustainableSustainableSourcingSourcing

• 100% palm oil by 2015100% palm oil by 2015

•• All agricultureAll agriculturematerials by 2020materials by 2020

CarbonNeutral

ZeroLandfill

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… operating in Flawless Execution …

Bigger, Better & FasterBigger, Better & FasterInnovationsInnovations

SPEEDSPEED = Value= Value

++ €€77m77miTO / week

Capabilities for SpeedCapabilities for Speed++

Innovation PlatformsInnovation Platforms++

EmpowermentEmpowerment++

MindsetMindset

==

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With Flexibility and Responsiveness

ResponsivenessResponsiveness ––LLeadead TTimeime FForor MMoreore

Agile SupplyAgile SupplyNetworkNetwork

HalvingHalvingLeadLeadtimestimes

Customer drivenCustomer driven

Winning with SuppliersImprove

PackagingTechnologyLTFM: -64%

Safety stocksat suppliersLTFM: -75%

MultipleSourcing Units

LTFM: -56%

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So there is more to come …

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Creating Value to the business …

GrowthGrowth

ProfitsProfits CashCash

DeliveringDelivering Sustainable, ProfitableSustainable, Profitable GrowthGrowth

32

We are fit to compete …

InterdependentInterdependentGlobal Network

Consumers& CustomersRecognition

InnovationInnovationSPEEDSPEED

SustainableSustainablePractices

ResponsiveResponsive,,Demanddriven SC

ConsumerConsumer

PerceivedQualityQuality

SkillsSkills &KnowKnowHowHow

GlobalScaleScale

D&ED&EFootprint

Route toMarket

CapabilitiesCapabilities

With Passion to Win !

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In Summary …

1. Radical shift from Cost-cutting to Value-creation …

2. Performance turnaround achieved in 18 months …

3. Unique Capabilities in place: We are fit to compete …

4. … Sustainably : Speed is our Currency.

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Thank you