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I'll then come back and provide an update on our strategy and key priorities for 2025 focused on the sharpened core record business. After that, we'll both be happy to take your questions. 2024 was a foundational year for Reckitt. As we announced a revised strategy and the steps that we're taking to deliver it, We're making big changes and I'm really proud of the work our team has done as we move towards becoming a world class consumer health and hygiene company. We've grown the business delivering on our ambition of driving top and bottom line growth, with strong earnings and cash returns to shareholders. [indiscernible] have also improved our market shares. With 55% of our top CMUs holding or gaining share, across both health and hygiene. Our innovation platforms have achieved very good results, with new products new category creation, driving higher margin growth across our power brands. We've also increased investment with total CapEx of £500,000,000 reflecting continued multiyear investments in in R and D and our supply chain. Which will help power innovation and the future growth of the business. We've simplified the business moving from five to three organizational layers to increase accountability and decision making.

Accelerating delivery and execution. And finally, we're seeing good early benefits from our fuel for growth program, which is supporting increased investment in our brands, to drive revenues expand margins deliver sustained earnings growth. This can be seen in our 2024 financial performance. Which delivered both top and bottom line growth with strong cash returns to shareholders. Group net revenue grew 1.4% in line with our guidance of plus 1% to plus 3% growth. While this includes the impact of the tornado in July, and a slow start to the cold and flu season, Health and Hygiene grew like for like net revenue by 4.6% and volume by 2.1%, excluding seasonal OTC. Regionally, we saw good growth in Europe, and developing markets, notably in China, where net revenues grew double digit. While seasonal OTC had a negative impact on our North American performance. Adjusted operating profit increased 8.6% helped by the start of our fuel for growth program. The initial actions to sharpen our portfolio and simplify the business enabled us to increase investment in higher growth, higher return areas. Higher operating profit led to strong EPS growth of 7.9% which was supported by our ongoing share buyback program well as a lower tax rate.

We delivered another year of increased cash returns with £2,700,000,000 returned to shareholders, through our dividend and share buyback program, up 75% on the prior year. As part of our strategy update, we also set out our intention to exit both Essential Home and Mead Johnson Nutrition over time. At Essential Home, the new leadership team is now in place and we remain on track to exit this business in 2025. As we move through the process, will share news with you On Meat Johnson Nutrition, the team has responded well to the challenges it has faced in 2024 We continue to defend ourselves against all cases the ongoing litigation, our brands remain strong led by Enfamil, the number one infant formula brand recommended by pediatricians. And Q4 like for like net revenue was plus 8.4%. [indiscernible] confident that Nutrition will deliver growth in 2025. [indiscernible] Overall, we've delivered a solid performance this year And just as importantly, we're making good progress laying the foundations for future growth. At the end of twenty twenty three, I set out the four strategic priorities for our business. Our progress in each of these areas over the last twelve months has not only contributed to good financial results, it has also strengthened our position for the year ahead and beyond.

Shannon will give more detail on the Fuel for Growth program, and then I'll come back to talk about the progress we're making against our innovation platforms, and more detail on our outlook for 2025 and beyond for Core Reckitt. Shannon, over to you.

Thanks, Chris, and good morning, everyone. I'll start by taking you through our financial performance for the year, before coming to our Fuel for Growth program and why we're confident in our ability to deliver a 300 bps reduction in fixed cost by the end of twenty twenty seven. I'll then turn to the new structure of the group, focusing on core Racket in particular and share our expectations for '20 Turning first to the key group financials for 2024. Like for like net revenue grew 1.4% in the year. Consistent with our guidance. Excluding seasonal OTC, which accounts for around 10% of group revenues, and is impacted by the timing of the cold and flu season, like for like growth was 2.4%. Our gross margin remained above 60% and expanded 70 bps year on year. Driven by pricing and productivity efficiencies, and a more benign environment for cost inflation. The additional impact of efficiencies from our fuel for growth program helped deliver a 90 basis point reduction in our fixed cost base, and supported 140 bps expansion in our adjusted operating [indiscernible] This progress enabled us to increase brand equity investment by 30 bps to 13.4% and drive EPS growth of 7.9% on an adjusted diluted basis. 2024 was another strong year for free cash flow.

Of £2,200,000,000 and enabled £2,700,000,000 to be returned to our shareholders. Through our dividend and share buyback programs. This is consistent with our capital allocation policy of returning excess cash to shareholders, while maintaining a strong balance sheet. Which closed the year at two times net debt to EBITDA. Turning to volume, where we continued to see sequential improvement across the business. In hygiene, volume trends were supported by the strong performance of our innovation platforms in particular across Lysol and Finish. We exited the year with second half volumes growing 2.5%. In Health, volumes declined 0.4% in the second half, given the soft cold and flu season.

Excluding this, volumes were up 2.7% in the second half. As we've seen broad based growth, a across our power brands of Dettol, Durex and Gaviscon as well as double digit growth in VMS. In Nutrition, while there was volatility following the Mount Vernon tornado, volume trends improved in the second half as we were coming to the end of the market share rebasing. Moving to net revenue growth by business unit. Hygiene delivered 4.2% like for like growth for the year. With a balanced volume and pricemix growth algorithm. Which is something we plan to continue into 2025. We delivered revenue growth across all of our power brands and across all of our regions in 2024, despite a more competitive environment. We're seeing positive market share momentum driven by being competitive on shelf and our successful innovation delivery. Looking at market shares, 55% of top CMUs held or gained market share. Up from 47% a year ago. [indiscernible] While not included in that 55%, it's pleasing to see Finish move into hold gain share territory in Europe as we exited the year. As the market leader in Europe, we intend to win. And we have good momentum. [indiscernible] AutoDish remains a competitive category in The U. S. With focus on driving in market execution.

Overall, Finish grew revenue mid single digits in the year, and grew high single digits in Q4. Strong innovation has also played a big part our market share momentum. With new launches across a number of our brands. Lysol in particular has been a standout performer in 2024 up high single digits as volumes turned positive. We aided by innovation with our laundry and air sanitizer launches in recent years. Moving to Health. Health delivered 2.1% like for like growth for the year. This reflects broad based revenue growth across non seasonal Power strong growth in China, and new innovations. Partially offset by a weak cold and flu season in 2024. Excluding seasonal OTC, the rest of our health portfolio had strong performance. Up 5.3% for 2024 with volume growth of 2.5%. [indiscernible] Looking at the market share data, 55% of health top CNUs either gained or held market share, which is up from 46% a year ago. You'll remember in October, we commented on the strong health share gains we were seeing in the most recent three month results. Mucinex was a big part of this. It represents one of our largest category market CMUs and has a significant impact on our external share reporting.

With a slow start to cold and flu in Q4, Mucinex moved out of gain hold territory and is not included in the 55% I just referenced. Our year end share reporting captures prior twelve month results by CMU. However, as we've seen the cold and flu season develop in Q1, Mucinex has moved back into game territory. With its superior efficacy, it performs best when consumers are looking for relief. China continues to perform well. Up double digits and is now our second largest country behind The U. S. Intimate wellness was a strong driver. Up high single digits across the group. As we gained market leadership in PU condoms in China. And VMS was up 10% across the group. Driven by the performance of Move Free in China. We've successfully navigated macro pressures by creating products that solve the unique needs of our Chinese consumers. And finding new and innovative routes to market. Finally, our innovation pipeline across health continues to deliver. With a number of new launches across Mucinex, as well as our launch of Gavi Digest across a number of European markets which is our first move into lower gastrointestinal. We're excited to see the growth that this can deliver.

Turning now to Nutrition, where like for like net revenue declined 7.3% in the year. Given the disruption to supply from the tornado in July, we exited 2024 with our non WIC market share at 36%. We expect that to improve through the year as supply normalizes. Given the evolving regulatory environment in U. S. Nutrien [indiscernible] have doubled our CapEx spend in Nutrition over the last two years.

Addressing key requirements to operate and sustain the business for the future. With a focus on driving remediation, compliance and resilience. Moving now to group adjusted operating profit. Consistent with our strategic ambition and in line with our guidance, we delivered growth ahead of net revenue at the group level as well as across each of our GBUs. [indiscernible] Group adjusted operating profit margin growth was driven by a 70 basis [indiscernible] increase in gross margin from pricing and productivity efficiencies. A 90 basis point fixed cost reduction with early benefits from our fuel for growth program. This was partially offset by a 30 basis point increase in BEI investment as we use some of the benefits of fuel for growth to invest behind our brands. Adjusting for the impact of the tornado where insurance proceeds to cover lost revenue went through fixed costs, Underlying group AOP margin grew 110 basis On an IFRS basis, operating profit for the year was £2,400,000,000 This includes £838,000,000 of impairment charges, relating to IFCN and Biofreeze. For nutrition, this reflects the significant capital invest program underway to meet evolving regulatory environments. For Biofreeze, a more challenging marketplace, within topical pain relief. [indiscernible] Turning now to fuel for growth in a bit more detail.

As we set out in July, our target is to exit 2027 with a 300 basis point reduction in fixed costs, landing at 19% versus 22% in 2023. We are confident that we'll deliver on this ambition. We shared in July, we expect to incur estimated one off cash costs of around £1,000,000,000 through the end of twenty twenty seven. And that the 19% target is inclusive of any residual costs after exiting our non core businesses. In 2024, we've taken GBP 161,000,000 of cost against this program and expect around £500,000,000 in 2025 with most of the balance in 2026. Today, we've delivered a net 60 basis point improvement in our operating cost base, and we expect a continued steady improvement of our cost base as we head to our 2027 target of 19%. I wanted to provide a little more color around the actions that we're taking in Savings will materialize across four areas: organizational simplification, a greater adoption of shared services and automation, rightsizing some historical investments, and benefits from digital and generative AI opportunities. As Chris said, we've made great progress on organizational simplification. Which will enable CoreWacket to move quicker make faster decisions closer to our markets and is driving increased accountability.

We're also making progress on our journey across automation and shared services. Today, we have pockets of services shared across the group. For example, within finance and within HR. And we can drive increased efficiencies and greater productivity with a more holistic [indiscernible] Across both functions and processes. We also see upside from rightsizing legacy investments. Take our global sales team as an example. We've optimized our global and local sales teams to reduce duplication, Increasing focus on priority areas, while further investing in new digital technologies to drive better operational execution. We're also investing in digital, and generative AI, As a component of fuel for growth, this area is important to improve costs as well as driving top line growth. Through enabling greater levels of collaboration, and innovation. And we're already seeing results An example of this is around product concept development. Where early findings show these tools reduce development time by up to 60%, while also significantly improving quality. GenAI tools will next be rolled out across our R and D function in 2025. To drive both productivity as well as product superiority. There's still a lot to do, but we have clear line of sight to 19% fixed cost base, by the end of twenty twenty seven.

Turning to EPS, which grew ahead of net revenue at 7.9% in the year, [indiscernible] This was primarily driven by our 140 bp improvement in adjusted operating margin. Our ongoing share buyback program added $0.08 per share, [indiscernible] As we continue to close out historic tax positions. We do expect our adjusted ETR to be in the 25% to 26% range in 2025.

These increases were partially offset by the strength of Sterling, our We delivered another strong year of free cash flow generation with a 91% conversion rate. We've increased the full year dividend by 5% and we continue to return excess cash to our shareholders with £1,300,000,000 returned through share buybacks in 2024.

And total cash return to shareholders up 75% year on year. [indiscernible] We did this while maintaining a strong balance sheet with net debt to EBITDA at 2x, which is consistent with our capital allocation framework. Our capital allocation policy remains unchanged. Turning now to our new operating structure. Going forward, we'll be reporting through three segments. [indiscernible] Essential Home and Mead Johnson Nutrition. We use the term core Reckitt for now to denote the future Wreck It business post exiting Essential Home and Mead Johnson Nutrition. Within Core Reckitt, we'll report three geographic areas. Emerging markets, Europe and North America. As well as reporting like for like net revenue each quarter across our four categories of self care, ger protection, household care and intimate wellness. You'll find pro form a financial information across our geographic areas and categories to aid in modeling of the new structure this morning's release. Core Wreck It has delivered 5% like for like growth on average over the past three years. With emerging markets in Europe above this and North America broadly flat. Following a period of rapid growth through COVID. Core Reckitt It has the highest gross margin of the three businesses, enabling a greater BEI investment in our power brands, [indiscernible] while still delivering the highest operating profit margin.

Finally, turning now to our expectations for 2025. This will be an important year for Reckitt as we continue repositioning our company. We're targeting 3% to 4% like for like net revenue growth in core Reckitt with a balanced delivery across half one and half two. Across our geographies, in Q1, we In North America, we expect low single digit growth, partially driven by retailer destocking, and a slower than expected ramp up in new capacity to meet stronger Lysol demand. We expect low single digit like for like growth in both Essential Home and Mead Johnson Nutrition in 2025, with both being back half weighted. Both of these businesses will show like for like declines in half one. Taking this altogether results in group like for like growth of 2% to 4%, with Essential Home and Nutrition making this a little more second half weighted.

With our Fuel for Growth program moving into its second year, we expect to drive adjusted operating profit ahead of net revenue growth. With adjusted net finance expense of $350,000,000 to £370,000,000 and an effective tax rate of 25% to 26%, we expect to deliver another year of EPS growth. I'll now hand back to Chris to talk about our strategic priorities. Great. Thank you, Shannon. I want to turn now to the actions we're taking to reshape Reckitt.

Through a sharper portfolio and a simpler organization. I'm confident that our strategy is transforming the business into a world class consumer health and hygiene company with one of the strongest growth and margin profiles in the industry. We have strong foundations with a portfolio of power brands that offer significant growth potential across the world. A year ago, I set out four priority areas for our business, areas that we've focused on through 2024. In July, I gave you an update on our portfolio value creation actions and the three principles that we've applied to our portfolio. One, a brand or business must have a clear and credible long term runway for growth. Two, it must have an attractive earnings model with a high gross margin to support continuous investment in growth and premiumization. And finally, a brand or business must have enduring competitive advantages. For instance, a number one or two Core Reckitt is comprised of a sharpened portfolio of 11 power brands that make up just over 80% of our net revenue all of which meet these principles. Our power brands sit across categories that are helping consumers improve their daily lives. With ever increasing focus on health and well-being, now further accelerated by the broadening use of GLP-1s, consumers across the world are looking to products that protect and provide relief.

They're willing to pay a premium for efficacious solutions. Whether they're in China, Mexico, India or right here in The UK. Our power brands play to these trends. Today, I want to talk in more detail about what we're doing in terms of product superiority, how we're enabling our teams to take advantage of these tailwinds to win in each of our markets. Our goal is simple, to delight our consumers. Innovation is at the heart of everything we do at Reckitt. It keeps us relevant with consumers and enables us to grow our categories and our market shares through premiumization, through the ability to enter new markets, and by growing into new and adjacent categories. Our innovation platforms have been a significant focus of mine since I joined Reckitt Reckitt. Initially, that was in developing and growing our innovation platforms in health, and more recently across the wider group. We have a deep understanding of consumer demand spaces, unmet consumer needs and category drivers. Our people know how to build and broaden iconic brands. Many of our brands are synonymous with the categories they lead. Categories that are expandable, higher value and less discretionary. As a result, we're in a far stronger position today than we were five years ago.

To give you just two examples, in Dorex, we're now market share leaders in polyurethane condoms in China. From a standing start five years ago. And in Lysol, we've used our strong brand equity to create an entirely new category with air sanitizer. [indiscernible] is what I mean when I talk about innovation platforms, the potential to deliver impactful lasting change to the business in a relatively short timeframe. And our innovation pipeline is getting stronger and stronger. Across all four categories and across all three geographic areas, we have even more exciting launches planned for this year and for 2026. So let me tell you what we're doing. In Germ Protection, we're bringing two of our most iconic power brands together. Lysol and Detol. A great example of how our shared Lysol and Detol innovation and science platforms will enable future growth laundry sanitizer. This is now a £300,000,000 net revenue business and it's the third largest segment within Germ Protection. These brands deliver trusted disinfection and provide significantly better consumer experience in Fabric Care with a unique benefit of killing germs that detergents leave behind. The global expansion of our two iconic disinfectant has unlocked significant growth with double digit CAGR over the last four years.

There is more to come. With significant opportunities to increase household penetration. Supported by our unique brand equity and superior science, We're expanding rapidly across key markets including China, and The U. S. To serve more sanitizer occasions with superior product solutions. Moving to self care. Museinex is known for its efficacious products and performs best when consumers need strong relief. As a result, as The U. S. Cold and flu season has picked up since the start of the year, its market share performance has also turned positive. This is another key brand in our portfolio that has a great future powered by innovation. In the past eighteen months, we've launched a number of innovations across our Mucinex brand. Including Fastmax Kickstart Cynus two in-one Nasal Spray, and Mighty Chews for children. We're feeling good about growing these new products in 2025, and we're looking forward to adding more innovation in this space. Turning to Intimate Wellness, which delivered high single digit growth in 2024. Led by our performance across developing markets, powered by the continued success of our innovation platforms. In 2024, as a result of sharp gains, Durex took market leadership in the polyurethane condom category in China.

And at the same time, we successfully launched new hyaluronic acid condoms, The 2025 pipeline is strong, In fact, at the moment, we're rolling out a revolutionary new condom in Europe. It is made from Night Trial, a first to the world innovation and a truly superior sensorial product that we're very excited about. Duraik's intensity coupled with the innovation strength across the rest of the Durex platform bodes well for the future of the brand and the wider intimate wellness portfolio. [indiscernible] in our Household Care category, Finish, had a good year growing mid single digits. As I've said before, we're having great success evolving and premiumizing the Finnish portfolio with 75% of our Tabs net revenue now coming from ThermoForm, This corresponds to over £400,000,000 of net revenue and our focus in 2025 is to continue to expand into this segment. As well as further improve in market execution across Europe and within key customers in The U. S. Shannon talked about our work using generative AI and finished is a great example. We're using our new tools to sift through years of past research and testing data, which is resulting in new product concept, that we're assessing.

Each grounded in science and consumer insights to create great products for the future. So there's a lot to look forward to with Finish in the coming years. Those are just a few examples of what we're doing with our brands and innovation. There is much more to cover. We have an embedded culture and process for sustained innovation. In May, our Chief Category Growth Officer Ryan DeLay, will host the first in a new series of regular record focus on investor seminars.

He will explain what we're doing in each of our categories, and show how we're working with our regional teams to deliver sustainable growth. Having great power brands is critical but they also need a winning proposition and strong go to market execution in each of their markets. And excellent execution. As we embed our new structure, this is an area where I believe we can achieve a step change in performance. [indiscernible] The new unified global category organization operating through the three geographic areas will allow us to address this. We will build on the success we've had While removing the duplication of roles by country, that developed within Autonomous Business Units in our old GBU structure. [indiscernible] Turning first to emerging markets. This is our largest and highest growth area. Where we see a rising middle class and significant penetration opportunities. That's reflected in our like for like net revenue CAGR of above 5% over the last three years. Including a strong performance in 2024. We have a great team with extensive experience in the different types of trade partners and channels across these markets. And with a deep understanding of the consumers we serve and the customers we partner with.

We know how to expand distribution. In India, we've expanded into high potential rural areas, growing market coverage by around 25% in two years as we leverage Google API data to map affluence and identify incremental distribution opportunities. And in Africa, we're seeing good growth from a small base across a number of Sub Saharan countries. Which promise a long runway for growth ahead. We know how to expand our categories, In China, we've increased revenues of our female intimate wellness brand Intima by 4x since 2023. We've driven debt hole expansion through five in one washing machine cleaner resulting in over a 3x net revenue growth since 2022. [indiscernible] portfolio including Moved Freight. We also know how to drive home our competitive advantage. In Latin America, superior execution and strong communication to consumers and healthcare professionals behind the Strepsis brand has enabled us to gain 600 basis points of market share in 2024. And we continue to invest in R and D capabilities to drive future growth. This includes breaking ground on our new global R and D center in Shanghai, which will amplify our understanding of the Chinese consumer as we look to expand and create categories through innovation.

I am confident in our ability to drive excellent growth in emerging markets. This will certainly benefit from the heightened focus that our new structure brings. Next, turning to our Europe Reckitt. Which is core records second biggest area. And delivered good growth of 3.3% in 2024. We have a distinct competitive edge with most of our brands all holding number one or number two positions spanning both OTC, consumer health and hygiene. As a result, we're particularly well placed to meet the growing demand for self care as healthcare systems come under increasing pressure. We're using data and technology to further improve our in market execution. In the past twelve months, our R and D teams have been using proprietary GenAI tools that take real time consumer feedback into account country by country, to better understand the success of our new product launches and apply these learnings to other markets. We've also deployed a new CRM tool for European pharmacies, offering advanced detailing capabilities and AI driven assortment optimization. And we're driving sustained category leadership across channels. Our discounted teams have held [indiscernible] enabling us to gain share in this high growth channel. And we're using our partnership with Dragonfly AI to predict the likelihood of our product images standing out on Amazon and other e commerce platforms.

Finally, North America, which accounted 26% of core record revenues in 2024. We see so much opportunity across this area. But I don't believe we're yet executing at our full potential. We have work to do to leverage our proven track record of creating and building iconic power brands and winning with our customers. We're investing in supply chain resilience for future growth. This includes the creation of a brand new OTC manufacturing site in Wilson, North Carolina. As well as material upgrades to our St. Peter's factory that will enable increased production of our Lysol products. We're accelerating growth in key categories by addressing unmet needs by broadening the shoulders of our iconic brands. An example being Lysol, a predominantly North American brand. Had a strong growth year in 2024 taking share powered by the success of our innovation platforms. [indiscernible] to a known category creator. First with laundry sanitizer, starting in 2017, and then Lysol air sanitizer starting in 2023. Since the launch of Lysol Air Sanitizer, we've seen strong momentum driven by two key factors. First, Positive consumer reception reflected in healthy repeat rates. We now hold the second highest ranking SKU in dollars in the Instant Action category.

Consumers see the value of Lysol Air sanitizer but also for effectively addressing odors, a major need in the air care category. [indiscernible] with household penetration reaching 4% by year end. Second, best in class execution. We have doubled our range on shelf in key retailers, unlocked off shelf location displays and secured twin packs and seasonal promo for early twenty twenty five. As a result, Lysol air sanitizer accounted for over 20% of total category growth, in 2024. A clear demonstration of how Reckitt It's innovation and execution can drive market leadership. There is a lot to do as we move through 2025 and beyond, but the future is an exciting one. Which leads me to guidance starting with 2025. As Shannon said, this will be an important year for record as we execute the second year of our strategic plan. We are targeting 3% to 4% net revenue like for like growth in core Reckitt and with our fuel for growth program moving into the second year, we expect group adjusted operating profit to continue to grow ahead of net revenue. And this will deliver another year of EPS growth. Looking out beyond 2025, we have the portfolio the geographic footprint for Reckitt to consistently deliver 4% to 5% like for like growth from 2026.

We will look to achieve this while consistently delivering Annual EPS growth and creating value for shareholders. In 2024, we set out our strategy, and we have made a good start. Our progress over the last twelve months has not only contributed to solid financial results, it has also strengthened our position for the year ahead and beyond. [indiscernible] The work to fundamentally reposition Reckitt is well underway. And we're focused on our portfolio of outstanding power brands to drive continued top and bottom line growth. Thank you for listening. Shannon and I will now be happy to take your questions.

Hey, guys. Roshat Cohen from Morgan Stanley. Thanks for the presentation. A couple from me please. First on the 4% to five midterm guide, obviously, [indiscernible] Running a little lower than what you guys have communicated over the past few months, What's driving the thought process there? Is it there anything structural that's changed over the last couple of months? Is there an element of conservatism there?

And then the second part, just on the building blocks to margin for 2025. If I think about what's the expectation for 2025, percent? Presumably some BEI spend will be reinvested from whatever savings generates. How do you think about the moving parts there? Thank you.

Okay, sounds good. I'll take number one. Maybe Shannon, you want to take two?

Perfect.

So big question. Look, I said at the half year last year that the medium term outlook for the core record portfolio was sort of a 5% growth rate. Now obviously, when we get to guide as we are today, we like to provide a range. We thought carefully about this and we're obviously seeing somewhat uncertain macro environment. So even though we're quite confident in our portfolio, as you can tell, we have competitive momentum, we have a strong innovation pipeline. Our innovation is working in the market. Even though we have that confidence, we thought it would be prudent to take into account that the external environment is uncertain and there are certain headwinds in some of our markets that we see in terms of consumer confidence. So Let's say, it's what we would like to think of as a prudent guide. We know that our portfolio can deliver at the 5% like for like growth level. And we know that in a great year, it could do better than that. We have done better than that historically sometimes when everything comes together. But we wanted to set a guide here that we feel very confident about And obviously, if we do exceed it, I think that will be a positive thing for everyone and a good beat.

So we have every intention of trying to do that. But as we guide today, we thought this was a prudent guide.

Great.

So on your questions around the building blocks around operating margin and how to think about that for 2025? I'd start with gross margins, which did expand in 2024. As we've discussed before, we have industry leading gross margins I'm not looking to drive further expansion of our gross margins in 2025. And so then if you think through the other elements feeding into operating margin, The fixed cost program that we've talked about, we've called out 300 bps of improvement. We delivered an underlying 60 bps 2024, I think the delivery of the remainder of that would be spread in a somewhat linear fashion over the coming three years. And then I would expect very similar to what we did in 2024, a portion of that will want to reinvest back into our BEI. To really ensure we're driving top line growth in a sustainable way. Then there'll be a portion that falls through and that will drive the operating margin expansion.

Thank you.

Chris Pitcher from Redburn Atlantic. I mean following up on the medium term, can you just explain to us what you're trying to tell us in terms of the outlook for operating margin? Because you've not made an explicit comment, while as you did for this year, you've not said EPS growth above sales. You confirm that? And then specific to the medium term, I appreciate it's prudent, but you've you've effectively made it harder to hit by narrowing the range. Are you telling us you're incredibly confident to four to five and therefore three would be disappointing in spite of this complicated and disrupted operating environment. Thank you.

Yes. I mean, we were setting a medium term guide. I don't expect current volatility to be a permanent feature, I hope not. And we think it's a prudent guide. We feel quite confident that we can hit it. And then like I said before, we could have widened the range, but then I think I'm not sure we would gain anything. Now we have given ourselves a guide that we feel comfortable with. And if we beat it, I think it's a good thing, right? It's going to be a positive for everyone. You want to talk about margin guidance? Sure. So your questions were both sorry, there you are, Chris.

Around the medium term guide on operating margin as well as EPS.

Yes. I mean, I'd say you've given no clarity on whether you expect margins to grow or indeed EPS to grow ahead of sales. If you could just further? Sure. So we do expect operating margins to grow and we've I think we've reiterated or we've intended to reiterate that we'll be growing profit ahead of revenue. And so we're standing by that long term financial model, which would then have our operating margins expanding over time. From an EPS standpoint, we're very focused on EPS growth year on year. I wouldn't want to guide it to whether it will be ahead of or behind of revenue, but for us, we realize that that's an element of shareholder value creation that's been missing over the past three to five years. And so we intend to deliver that on an annual basis moving forward.

And just to clarify that, that would be the dilution from future transactions that is causing that position? Well, so the guide that we provided just to ensure clarity for 2025, assumes that we have all three operating segments for the full course of the year. And so that's just to make sure we're all operating the same page for 2025. As you think moving forward, as we execute against an essential home transaction, Obviously, that would bring with it some level of dilution, but we've also been clear that we have a fixed cost program underway that we expect to hit the 19% regardless of or in the event of even as we dispose of those businesses. So we have a number of levers around EPS, where we feel confident over the long term of being able to deliver sustainable EPS growth. [indiscernible] David Hayes from Jefferies. Two for me. Just looking back at the 2024, A and P or BI spend up 30 basis points, but obviously huge gross margin development and the cost savings. So to your point about the outlook, strategically, one of the priorities and principles is reinvestment. Was there Was there a kind of a decision not to reinvest as much back in the second half Is that something was there a reason for that?

And is that something that get kind of accelerates more for species as well as you go into 2026?

At '25 even.

And then secondly, just in terms of the guidance, there's no mention of dissynergies, but I guess forecast at the moment until you know when and how, etcetera, the business gets divested in terms of the central home. But is the guidance assuming no dissynergy? And I guess when I'm asking that, we assume you're getting it ready to be standalone almost day one. So will you be duplicating costs to be ready to do that towards the end of the year? And is there element of that in the guidance? Or will we get that to offset and we get more information on that as you kind of go through the process? And have you got some kind of guide as to what that dyssynergy might look like? Through the year.

Let me start on BEI. So good question.

I think we definitely invested more in our business last year. We always assess these investment opportunities on a case by case basis. So it's not a sort of a broad sweeping decision. It's does this investment make sense Should we accelerate this brand? Do we have innovation or new news that we want to invest behind that reach more consumers? And we arrived at the conclusions that we arrived at. And I feel good about that. We'd like to see a steady increase in our BEI investment, but I would think of it as steady. And it's not a place where we want to overinvest necessarily and have wasteful spending. We've seen examples of that in our industry and it doesn't necessarily drive results. So I think we will be smart about it. We'll invest in particular behind innovation. And when we're creating new categories like air sanitizer, where we have real new news to share to educate consumers. We're going to invest behind that. So I think the good news is with the plan that we have, the that we have in the fuel for growth program, which is successfully delivering in its first year, We have the room to invest.

So we clearly have a good amount of room to invest. And we think that's a good place to be for us as management to judge growth opportunities that we can invest behind. So So I would expect it to increase. The other offset is have quite a good productivity program that also applies to to marketing. And so we also generate savings that offset some of those increases in the year. So sometimes we actually deploy more working spend than you can see in that that number. On the separations, look, we're working on this at the moment. We made very good progress. I would say that process of setting them up on track. And I've been pleased with the work that the new leadership teams have done. We are sizing the financial impacts We're also trying to be smart about not setting up very redundant structures for no reason until they're needed. But obviously, we want to get ahead of any eventual day one where the company has to be fully self sufficient. So we're working through that at a great level of detail. And we are costing those impacts Our guide, as Shannon said, assumed that we effectively operate these segments through 25.

Just because even if there is a transaction, obviously, it takes time for a transaction to close.

And then the intention is that when we have a a deal to announce a signed deal on Essential Home, we'll clearly provide more quantitative understanding of dissynergies? But if we wouldn't see dissynergies this year then? Based on at the moment, I guess, the timing and the Yes. I mean, obviously, it depends on deal timing. And how that comes together.

But what I would tell you is we're driving such significant savings in the core that I don't expect that to be a A big impact. Thank you so much. [indiscernible] So a couple of questions from me. So first of all, just on the 25 guide for the core Reckitt If business, Can you run through some of the specific factors that lead to that being below your medium term guide. And then the second point would be on Biofreeze. You've now taken two write downs. On that business if I remember correctly. I think at the time, this looked a very exciting acquisition. It took you into an area of pain that you were not competing in. The brand looked good equity, a very good growth track record. So can you talk about, okay, why this acquisition hasn't worked out as you had expected it to? And also then what you think you can do with the [indiscernible] given where it is today and what contribution Topical Pain can make to your self care business?

Sure.

Why don't I start on Biofreeze and then maybe hand to you for the factors in the guide. So look, I will tell you, first of all, we're very happy that have Biofreeze in the portfolio. Biofreeze is a brand that fits our criteria. For our portfolio. It's a strong equity It's a category that grew very fast for a long time. And really what we're facing is a pretty broad based category issue in topical pain in The U. S. That emerged when we went through this historic COGS spike that we've been through and the consumer came under a lot of pressure. It is true that topical pain is slightly more discretionary as a category. And so when consumers are under historic pressure, which they've been over the past few years, They do change their consumption habits and the category slowed significantly during that time. These products are highly efficacious including our Biofreeze products. Biofreeze is a leader in the category and I fully expect the category to return to strong growth. As we get to a more normal environment as the consumer recovers, from this cost of living crisis and that period of time. We have a strong innovation pipeline behind Biofreeze.

That I'm very excited about. We are also rolling out Biofreeze in other markets [indiscernible] We have other strategic options to expand the brand that we might share with you at a later date. So we all in all, we have a good growth agenda for Biofreeze, but we did run into significant category slowdown and headwind from the cost of living crisis. Biofreeze is a brand that really thrives on display and retailers pivoted away from putting this category on display during that time and we're seeing signs that that's coming back. So while I would have loved to not go through that slowdown, there's nothing structural about the category or Biofreeze that we're worried about. Okay. On the guide for 2025, guiding core record at 3% to 4% Look, our guide for 2025 reflects our current view of the operating environment, which I would say has a level of uncertainty with [indiscernible] When we look at tariffs, when we look at consumer confidence, we look at store traffic, when we look at inflation, there's just a level of uncertainty and volatility that exists across North America and across the globe today. That we don't see that or hope that that doesn't persist ongoing.

And so that's not necessarily as reflected [indiscernible] the current operating environment and provide a guide that we're confident in our ability to deliver.

Good morning. I'm Harold Thompson from Chelten. Just a couple of questions. Chris, you kind of indicated the process of separate [indiscernible] there anything you can maybe say about the actual sale process or the interest you're getting or anything realize you can't say very much, but just anything you can say would be of help. And then, of course, Shannon, you said that EPS delivery was an important part of your journey something that had been missing in recent years. I think you've been very clear that we're essential homes sold, particularly for cash The plan is to return everything to shareholders through buybacks. I just want to make sure that commitment is still there And yet you're not going to a tangent to acquire growth through M and A again.

Good questions. So on the process, I'd love to be able to say more, but I think you understand that we are in the process doesn't lend itself for me to be overly specific.

What I can say is the overall process is on track. And I'm feeling good about it. And that's about it. When we have news to share in terms of something concrete, will, of course, provide full transparency and visibility and share what we think the financial impacts of it is.

Then the messaging around proceeds from Essential Home remains very consistent. So we expect to return all excess cash from that transaction to our shareholders We've not yet decided whether that will happen through a share buyback whether that would happen through a special dividend. So we'll have more to share on that when we get to the point of announcing a transaction. And as far as your question on M and A, I think we would agree our plates are quite full. So the intention is to return that cash to shareholders.

Very clear.

James Edwards James from RBC.

Just following up on Harold's point.

Are you to double running a spin off process in case The sale you can't dispose to a third party an acceptable price? And could you say a bit about tariffs, what the potential impact on your business would be? Yes. I think I can address both. So We're going to do the right thing for Reckon shareholders and we're looking at everything under the sun to do that.

Okay? So we're open minded and quite rational about that. At the same time, as I indicated before, We thought there'd be good interest in these assets and so far there is. So That's probably all I'll say on the first one. On tariffs, it is a very dynamic picture, as I know you know. And therefore, it's hard to be sort of equivocal about anything. We have been looking at it and we have been looking at scenarios from what might happen and what impact it would have on our business. The good news is it's not a significant impact to our business. Yes, there will be some But we source most of our products from the regions we operate in. I think you saw some of the metrics on the slides probably about that. And we're making investments to further localize production. And frankly, we were doing that before the tariffs came because it's just a good thing for the business. It's a good business idea. We will look at these tariffs whatever they turn out to be, and we will have a number of levers to mitigate the impact We are not as exposed as many other industries and probably other companies And we have quite a good set of levers to pull We talked about our gross margins, how high they are, how much productivity we have flowing through our P and L. And obviously, we have pricing power as we've shown over the past years if it comes to that.

But I think it's premature for us to say anything quantitative because it changes every day. [indiscernible] Thanks very much. It's Ian Simpson of Barclays.

Just a couple of phasing questions, if I could, in terms of how we think about 25.

So you talked about essential home being low single digit for the year, but being negative In H1, Could you just touch on why Essential Home will be negative in H1, please? And then secondly, when we think about the margin phasing for 25 I'm mindful that you seem to have restated the H1 24 margin. Think that's Gone up. I was just wondering how we should think about the you've said core margin expansion twenty twenty five, but I was just wondering any guide you give us as to the phasing of that? Thanks very much.

Sure. So first question on Essential Home. Why would it be negative like for like in the front half? There's really two significant drivers of that. The first, Ian, that I'd share is we're lapping really strong past season from a year ago. And so it's a bit of a comp and what we're facing there. The second would be, and we talked about it quite a bit last year, Air Care in The U. S. Continues to be a very competitive marketplace for us. And so that continues to be an area where we're working hard to compete. But where it's a tough battle right now for that business. As far as margin phasing, we don't provide guidance on operating margin by half. And so so I'd sort of leave you to thinking through the guidance we've provided on how top line phases across the year for the group. It will be little bit back half weighted for core Reckitt. We expect top line growth to be balanced across half one and half two.

Okay. Thanks.

Tom Sykes from Deutsche.

Firstly, just on the margin improvement how much of the margin improvement did come from Essential Home, particularly in the second half of the year, please. And then just on transactional FX at the end of the year, post the election, there was obviously a very strong move in the dollar. You import a lot into The U. S. Perhaps it was slightly surprising how much you do import into The U. S. You gave that interview that said it was 40%, I think, of of products sold. So I just wonder what how much do you hedge that transactional exposure and what was that hedging year on year? And how should we think about transactional FX gains going into '25, please?

You don't want to take the transactional FX hedging? I'd be happy to take that I assumed you were.

Okay. So first question, Essential Home, how much margin expansion in 2024? Is your question was driven by Essential Home? I think we'd actually have to circle back to you on that because we weren't operating the business in 2024 through a lens of essential home. So I honestly And I'm probably going to take a follow-up on the transactional FX hedging of imports into The U. S. As I don't have an answer Apologies.

Thanks. It's Calameenia at Bernstein.

I just wanted to come back to BEI because I think you said, Chris, that you want a steady increase But the 30 bps increase in fiscal 'twenty four, I think you were plus 100 bps in the first half. So I think it implies down 50 bps something like that in the second half of the year. Which is obviously the opposite of a steady increase. So maybe you can just flesh out for us, is should we just be thinking about this as a phasing thing in 2H? Or should we be thinking about it as some kind of steer as to the speed of the reinvestment over the medium term?

No. So when I say steady increase, talking about annual steady increases. So if you're modeling our BEI percentage, year over year, I would model a steady increase. But like I said before, it's not steady as in steady every month. Because we invest behind big moments when we have a big launch, when we have new news to share, a new claim, whatever, a reset of a shelf, that's when we invest. So actually oftentimes we make big investments in BEI in the spring because we're launching new innovation across markets So I wouldn't interpret anything into that. Our commitment to to invest in BEI is high. And we have areas where we can invest. And like I said, we have innovation where we can invest behind it. So I intend for that to be a steady increase year on year. But not like a linear steady month by month increase. That wouldn't be rational.

Thanks. And I have a follow-up for Shannon on free cash flow. You spoke very positively about the free cash flow, Shannon, but I think it's actually down year on year. And conversion was still strong in the kind of low 90s You know, record used to be exceptional and low 90s is maybe more in keeping with where some of your other CPG peers are. So my question is, should we interpret the positive tone around free cash flow despite the negative year on year growth as you're happy with 90% free cash flow flow conversion and that's where Reckitt is going forwards, we expect it to get back to 100% plus?

I don't know that I'm ready to commit that we'll get back to 100% plus. What I'd say is we continue to have a high level of focus on free cash flow. Across management, across Chris and myself. We believe it's actually a unique characteristic of and we want to continue to drive that. And so I would expect that it would get back up into the mid-90s over time. And so I wouldn't take this change in strategy or some sort of permanent change in direction?

Thank you. Yes, I've just got one follow-up. I mean, when you showed the slide with how your portfolio of key brands Looks like it's clearly looks very impressive. There's, of course, a large element of them, which are kind of OTC related. And in the past, it was always argued that rolling out OTC brands kind of more globally and filling up the white spaces was quite a slow and arduous process because all the regulatory barriers and so on and so forth And yet when I look at the presentation of some of the innovations, they also look quite exciting. So how how easy will it be to leverage effectively your new portfolio [indiscernible] to deliver that growth because it's actually got constraints regulatory constraints to be able to roll that out. So how does that balance out?

Yes, it's a great question.

Expanding OTC across the world is a Top two priority for the company. This is one of the most attractive things that we can do.

But also expanding our OTC portfolios within countries where we all really have a trademark and registration where it's easier. The goodness is we know how to do this. So if you look at some of the brands in our portfolio like Strepsisols and Nurofen and Gaviscon, They have realized very strong growth over the past five, ten years even, because we've been able to register them, get them approved, launch the brands in a series of markets arduous, it's time consuming, it is. And there's a fair amount of work and investment in regulatory and other activities, sometimes clinicals that you have to go through in order to go through that process.

But what's nice about the OTC business it's a little bit different than most other businesses in the consumer sector, is Once you're there, once you have the registration and once you've built a trusted brand, it's a real moat. And so what's great about the OTC business is those investments, you have to make them with a long term view But if you make them smartly considered, and sustained then you get some very good returns in the end. And that's how we're running the OTC business. So this is a major priority for us. Now doesn't always involve stretching brands. Because actually the premium of having global brands in OTC is not very high. What matters is did you have a strong brand in the local market and that the medical professionals and pharmacies understand the benefit of the product and recommend it. So that's how I would look at it. So it's a major priority for us. It does take time, but we're good at it.

Hi there, sorry, a follow-up now. I mean, apologies with all the medium term stuff at the start. In terms of the structure of the new [indiscernible] When the strategy was set when he first joined Chris. Part of the investment was to build out your distribution network, build out sales, target new markets, The pandemic gave you more funds to do that. The growth in brands like Lysol, etcetera, seem to be more about the category extension. Within existing markets. How do you see the business now geographically for the sales force you've got in terms of driving Finish Lysol, Detol into new markets? Is that delivering as hope Yes.

So we have seen really significant distribution gains in a number of markets over that timeframe. We've also fundamentally elevated our relationships with our most important retail partners, during that timeframe. And all of that is something that stands us in good stead and has benefited the business. As I look ahead from where we sit today, I would say the biggest And there is a long decade long runway for growth in terms of driving that distribution, driving out a broader assortment, reaching more outlets in places like Africa were just getting started. But it actually is a very exciting opportunity for us. Latin America, we still have significant opportunity And in India, even though India is one of our strongest businesses, where we have expanded coverage for years, we still have the expansion opportunities that I discussed today. So it's not just about expanding physical stores. And I would say in Europe and in North America is our focus is very much to win on the screen. And not just with Amazon, with everyone, right? Every one of our large retailers have become omni channel retailers pretty much. And some of them are extremely good at And so right now, we're also very focused on winning on screen.

With our big retailers. All the big U. S. Retailers are quite sophisticated at this now and it's a real focus for us. And that will also happen in Europe over time. It is starting to happen a little slower than The U. S. So that's a major distribution opportunity in developed markets. But distribution remains a really big pillar of our growth. And it's a really nice way to drive volume growth and household penetration.

And we'll remain focused on it.

A couple of follow ups from me as well if I can. So firstly, just on the the cost saving. Can you talk about the reaction internally to that? If you look at some of the postings on various websites, There is talk about distracting and disconcerting this. I mean, is that something that you worry gets more than a theme as you try and do even more cost saving. And you talked about headcount reduction within the savings. Can you give us a sense of headcount reduction to date and what the actual plan is for headcount? Over the sort of the whole three year period? And then coming back to the guidance again, sorry, on '25. This modest or cautious prudent guide of being more likely to be in the midterm for the reasons you mentioned. But I guess you've got an easy comp, you would think, in the fourth quarter against the the weak cold and flu season. At the moment, the data shows that everyone in America seems to be sick suddenly having been not sick through the fourth quarter. So just what is the assumption in terms the cold flu dynamic within that three to four, do you expect a normalized season or do you ship think we could gain just in case and it could be upside?

Okay. So three here.

Let's start with the maybe last one.

Look, you have to remember that as seasons go, we actually ship the bulk of volumes just like our peers. That's how the industry works. We ship in the fall. So the initial shipments happen in the fall. And they happen to plan. We tend to ship to an average [indiscernible] Unless retailers want to stock up and then they make those choices. And that's what happened in the fall. What didn't happen in the fall is replenishment orders because there was not much of a season as you said. It was unseasonably warm in The U. S. For most of Q4. And people simply weren't getting sick at a normal rate. Q1. That's why our seasonal OTC business did what it did, just like it did with our peers. And yes, then you would expect the retailers would sell through that inventory and then they judge when they want to replenish and that's what we're going to see here in in this month and we'll know more about that. In terms of our guide, therefore, I mean, yes, you would say from a sellout standpoint, from a POS standpoint, there's probably a benign lap in Q4. But it doesn't translate directly to shipments for the reasons that I just talked about.

Terms of headcount, We haven't shared any numbers in part because we don't have any final numbers because we're going through a extended process of redesigning, simplifying and optimizing our business. We have quantified those benefits in the numbers that Shannon has shared repeatedly on fuel for growth. And so that gives a sense of magnitude. This is not small. What I can give you is a sense of magnitudes at certain layers of the organization. We have a lot of visibility now to what we're doing. We have simplified our management structure significantly.

And as I talked about, we've gone from five to three layers of management in the business, which is a real benefit And by the way, our people feel very good about this Our people were tired of the complexity of the prior model and could see there were too many leaders in the business and it was actually clouding to some extent, clear and fast decision making and accountability. So that initiative enjoys broad based support and we have reduced our senior leadership ranks something like 15% to 20% already and we're not done. And that's because we want to simplify our company. We want to simplify the business.

And we think it makes it better. Now in terms of can it be distracting, I think we had a pretty open conversation in the summer of last year about this. Of course, when you undertake large scale change, there's always the possibility of some distraction and and that's a fact of these kinds of programs. But there's a way to do it where you minimize that and where you have early warning systems and you detect it. And so we have put in place [indiscernible] structures to oversee the change and enable the change and track the change.

And we measure that at a fairly granular level and quite frequently And we in the group executive meet on it weekly. So pretty close to what's going on and we're watching it. I wouldn't tell you that there's not something that could go wrong somewhere. That I cannot guarantee, but what I can say is that we will mitigate it, whatever it is. And so far, that has not been the case. I'm actually very pleased to see the kind of market share momentum we have the kind of execution I'm seeing in the business, how fuel for growth is happening, how our innovation is paying off. That doesn't indicate to me that we have a problem executing while we're doing this. But it is a challenge. And so I think it's a very fair question.

I miss answering any of your questions? [indiscernible] Okay.

There are a few online.

And unsurprisingly some of them are quite long. Who'd have thought so? I'll say analysts want to ask long questions.

Right. So there's a few on guidance.

I mean, I've not seen anything which is So I think been asked already. So I'm planning on parking those for now and we can follow-up if people want. So Carlsa, that's from Capital. I'm asking around some of these. So for hygiene, you mentioned to see balanced volume and price mix for 2025. What's the outlook for the entire company? And then white space appear to be a big priority for several power brands. What are the platforms that have the largest potential over the next few years? And then just one on the transactions from a supply chain point of view, how is the separation of the Home Care business proceeding?

You want me to do price mix?

Sure.

Okay.

So as I think about the, growth algorithm, I would say my expectation is that it will be pretty balanced. And so what you've seen is coming out of 2022 where our top line growth was very driven by pricing, and I think we all know the history and the reasons why, As we moved through 2023 and as we showed on one of those slides today moving through 2024, we've sequentially seen improvement across both Health and Hygiene over those two years and gotten to where we're exiting 2024 with a pretty balanced out When I think about our business going forward, I would expect that year in and year out, we should have a point or two of our growth that's coming from pricing. As we price with innovation and as we take strategic pricing in markets and brands where needed. Think we would have a point or two of growth that should be coming from unit volume growth because that's a foundational element of healthy top line growth. Then I think we should see some top spend that comes through mix year in and year as we innovate and premiumize across our brands.

Yes. I think there was a question about essential home manufacturing separation. Did I hear that Supply chain separation?

I would say the same thing. We have very capable teams working on this separation at the moment and they have been working for some time. That work is progressing well. And I'm very pleased with the work that they've done. And so they're is nothing in that work that tells me that there is going to be any roadblocks there or anything. So that's on track.

Perfect.

White space. White space from a category or geography Reckitt was across the platform, so just one of the Yes. Well, I mean the good news is, as I went are pervasive. It's not one brand, one country, It is a broad based pipeline that we have that we're investing behind. And when we land a successful platform like we did in laundry sanitizer and air sanitizer, polyurethane condoms, and a number of others. When we land one of those, we continue to invest behind it. It doesn't go anywhere. It just compounds. And so that's been our experience. And so therefore, the category priorities that I talked about today are the the priorities that we're going to focus on, and they have significant runway for growth.

Perfect. I've got a couple from Guillaume at UBS. So one is a clarification on your On your guidance for operating profit, a starting point 24.5 or is it 24.2? So highlighting Mount Vernon.

And then secondly, Mead Johnson, you expect low single digit like for like this year. Notwithstanding a favorable comp in Q3. And ambition to regain some market share in non Wickes. So what are the main factors that's that we need to think about as we go through the year for me, Johnson?

Okay.

Do you want me to do about this? Go ahead. Okay. So for operating profit the starting point should be the 24.2%. So we're trying to be clear and transparent around what were the benefits that we saw as we had insurance proceeds related to the Mount Vernon tornado in the Nutrition business flow through the P and L this year. And we'd shared at the half year the guidance that that was our expectation and that our teams were working hard to to get the full proceeds within the fiscal year so that this doesn't become a cross year dynamic. So $24,200,000 would be the answer for the first question.

On the Mead Johnson question, low single digit growth for the year, we expect negative like for like in the front half, growth in the back half. There are a few different dynamics that are driving why we would see negative like for like for Mead Johnson in the front half. And I'll acknowledge and we discuss it regularly. It is a complex business because of some of the factors that we've been dealing with. And so there are really three drivers I think about that are impacting Nutrition's top line in the front half. The first would be continued impact from the tornado. And so we discussed at the half year and at Q3 the fact that there were some supply gaps because of the tornado. In a business like nutrition, when you do have periods of time that you have supply gaps. You think about it as losing a cohort of babies. And so I shared the fact that our share our market share is at the 36. We fully expect that to of time in a business like infant nutrition. The second would be last year in the front half, we discussed the fact that private label infant nutrition was having supply challenges.

And so we were seeing tailwinds and benefits from that in our front half results and that seems to have been resolved. So that's now something that we're comping in the front half of this year. And then the other comp issue is really last year in the front half, we were refilling the pipe around Nutramigen coming off of that voluntary recall. And so that's another comp that you have to think about when you look at front half growth rates versus year ago and versus back half growth for this year.

Perfect. All right. I think we're down to the last one. So just to say, so Victoria Petriva from Bank of America asked on On guidance, so Rica, I think we've touched on that. [indiscernible] Jeff Stent from BNP asked about North America volumes and I think we touched on that in tariffs. So I think the last one then is another one. It's a follow-up from Guillaume. On Q1 guidance. What's driving the soft start to the year in Europe?

And And then the second part of that is a question around private label. Do we see any pressure from private label in the region? Take those. So Europe, Q1 We fully expect to have a good year in Europe in '25.

Q1 is flat expect it to be flat. Part of that is some phasing of shipments, part of that is a relatively subdued consumer environment. And but we have a really good plan for the year in Europe.

We have good innovation launching. I talked about the Nitrile platform as a really key one that will help Jurex realize some good growth in Europe. But I feel like it's not a structural issue. It's just a slower start. And sometimes that happens.

And the second question was private label.

We're not seeing a big impact in our [indiscernible] spike a bit in certain categories during the cost of living crisis and when consumers were under a lot of pressure, Generally, it's always important to remember that we are a very premium branded business. And we tend to exist at the higher end of the categories we operate in. And so we are actually at times a little bit less vulnerable to trade down from private label than if you operate in the middle.

But anyway, the good news is there's there's no real issues on the horizon as it pertains to private label.

And that is everything from online. So