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| Equity and liabilities [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Capital and funding | 15. Capital and funding
The Group’s Treasury activities are designed to: ■maintain a competitive balance sheet in line with at least A/A2 rating (see below); ■secure funding at lowest costs for the Group’s operations, M&A activity and external dividend payments (see below); ■protect the Group’s financial results and position from financial risks (see note 16); ■maintain market risks within acceptable parameters, while optimising returns (see note 16); and ■protect the Group’s financial investments, while maximising returns (see note 17). The Treasury department provides central deposit-taking, funding and foreign exchange management services for the Group’s operations. The department is governed by standards and processes which are approved by Unilever Leadership Executive (ULE). In addition to guidelines and exposure limits, a system of authorities and extensive independent reporting covers all major areas of activity. Performance is monitored closely by senior management. Reviews are undertaken periodically by corporate audit. Key instruments used by the Treasury department are: ■short-term and long-term borrowings; ■cash and cash equivalents; and ■plain vanilla derivatives, including interest rate swaps and foreign exchange contracts. The Treasury department maintains a list of approved financial instruments. The use of any new instrument must be approved by the Chief Financial Officer. The use of leveraged instruments is not permitted. Unilever considers the following components of its balance sheet to be managed capital: ■total equity – retained profit, other reserves, share capital, share premium, non-controlling interests (notes 15A and 15B); ■short-term debt – current financial liabilities (note 15C); and ■long-term debt – non-current financial liabilities (note 15C). The Group manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to our shareholders through an appropriate balance of debt and equity. The capital structure of the Group is based on management’s judgement of the appropriate balance of key elements in order to meet its strategic and day-to-day needs. We consider the amount of capital in proportion to risk and manage the capital structure in light of changes in economic conditions and the risk characteristics of the underlying assets. Our current long-term credit rating is A+/A1 and our short-term credit rating is A1/P1. We aim to maintain a competitive balance sheet which we consider to be the equivalent of a credit rating of at least A/A2 in the long term. This provides us with: ■appropriate access to the debt and equity markets; ■sufficient flexibility for acquisitions; ■sufficient resilience against economic and financial uncertainty while ensuring ample liquidity; and ■optimal weighted average cost of capital, given the above constraints. Unilever monitors the qualitative and quantitative factors utilised by the rating agencies. This information is publicly available and is updated by the credit rating agencies on a regular basis. 15A. SHARE CAPITALFollowing completion of the demerger of the Ice Cream business on 6 December 2025, Unilever PLC ordinary shares were consolidated to maintain share price comparability before and after demerger on 9 December 2025. The consolidation was approved by Unilever shareholders at a General Meeting held on 21 October 2025. Shareholders received 8 new ordinary shares with a nominal value of 31/2 pence each for every 9 existing ordinary shares which had a nominal value of 31/9 pence each.
(a)At 31 December 2025, 2,181,005,247 PLC ordinary shares of 31/2p were in issue (2024: 2,521,497,338 PLC ordinary shares of 31/9p). During the year, there was a reduction in the number of shares by 279,078,800 due to the impact of the share consolidation, 3,500,000 new shares were issued, and 64,913,291 treasury shares were cancelled. (b)The ordinary share capital of PLC is translated using the conversion rate as at the date of Unification of £1 = €1.121. 15B. EQUITYBasis of consolidation Unilever is the majority shareholder of all material subsidiaries and has control in all cases. Information in relation to significant subsidiaries is provided in note 27 on Subsidiaries with significant non-controlling interests Unilever has one subsidiary company which has a material non-controlling interest, Hindustan Unilever Limited (HUL). Summary financial information in relation to HUL is shown below.
Analysis of other reserves
(a)Relates primarily to options to purchase non-controlling interest in subsidiaries. 15B. EQUITY continued Unilever acquired 27,815,955 (2024: 27,368,909) of its own shares through purchases on the stock exchanges during the year, which includes the share buyback programme as explained in note 24. During 2025, 13,288,138 PLC ordinary shares held as treasury shares were cancelled before share consolidation and 51,625,153 cancelled after share consolidation. At 31 December 2025, the employee benefit trust held 1,208,143(2024: 1,776,250 adjusted for share consolidation) of PLC shares. PLC and its subsidiaries held 314,912 (2024: 290,198 adjusted for share consolidation) of PLC shares as treasury shares in connection with share-based compensation plans. The shares are
Remeasurement of defined benefit pension plans, net of tax
Currency retranslation gains/(losses) – movements during the year
(a)For the purposes of this note and note 17A, financial assets and liabilities exclude trade and other current receivables and trade payables and other liabilities which are covered in notes 13 and 14 respectively. (b)Bank loans and overdrafts include €3 million (2024: €4 million) of secured liabilities. (c)Includes options and financial liabilities to acquire non-controlling interests in the US, Myanmar and India, refer to note 22. Reconciliation of liabilities arising from financing activities
(a)These cash movements are included within the following lines in the consolidated cash flow statement: net change in short-term borrowings, additional financial liabilities, repayment of financial liabilities and net cash flow used in discontinued financing activities (excluding interest paid of €(170) million and the capital component of leases of €(46) million included in (b) below) The difference of €99 million (2024: €(68) million) represents cash movements in overdrafts that are not included in financing cash flows. (b)Lease liabilities cash movement is included within capital element of lease payments and net cash flow used in discontinued financing activities €(46) million from (a) above in the consolidated cash flow statement. The difference of €(6) million (2024: €4 million) represents gain or loss from termination and modification of lease contracts. 15C. FINANCIAL LIABILITIES continued Analysis of bonds and other loans
(a)Bonds includes €(281) million (2024: €(373) million) fair value adjustment following the fair value hedge accounting of fixed-for-floating interest rate swaps. Information in relation to the derivatives used to hedge bonds and other loans within a fair value hedge relationship is shown in note 16.
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