Haleon plc (NYSE:HLN) Q4 2025 Earnings Call Transcript

Haleon plc (NYSE:HLN) Q4 2025 Earnings Call Transcript February 25, 2026

Operator: Good morning. Thank you for attending today’s Haleon’s Fiscal Year 2025 Results question-and-answer. My name is Sarah, and I’ll be your moderator today. [Operator Instructions] I would like to pass the conference over to our host, Jo Russell. Please go ahead.

Joanne Russell: Good morning, everyone, and welcome to Haleon’s Full Year 2025 Results Q&A Conference Call. I’m Jo Russell, Head of Investor Relations, and I’m joined this morning by Brian McNamara, our Chief Executive Officer; and Dawn Allen, our Chief Financial Officer. Just to remind listeners on the call that in the discussions today, the company may make certain forward-looking statements, including those that refer to our estimates, plans and expectations. Please refer to this morning’s announcement and the company’s U.K. and SEC filings for more details, including factors that could lead to actual results to differ materially from those expressed or implied by such forward-looking statements. We have posted today’s presentation on the website this morning, along with a video running through the results in detail. So hopefully, you’ve all had a chance to see that ahead of this call. And with that, let’s open the call for Q&A, and I’ll hand back to the operator.

Q&A Session

Operator: [Operator Instructions] Our first question is from Guillaume Delmas with UBS.

Guillaume Gerard Delmas: So one question. So my one question is on your organic sales growth guidance of 3% to 5% for 2026. I mean it does seem to signal some sequential acceleration relative to the 3% you posted last year. So wondering what will be the main drivers behind this sequential improvement? I mean, is it predicated on category growth accelerating and/or your level of outperformance gaining further momentum? And then related to this, Brian, you reiterated your medium-term ambition of 4% to 6%. I guess what underpins your confidence in the 4% to 6% when you may be delivering an organic sales growth below the bottom end of that range for now 2 consecutive years?

Brian McNamara: Thanks, Guillaume. I appreciate the question. So maybe let me take the 3% to 5% guidance, and I’ll go to medium-term view. So if you take a step back and let’s look at 2025, we grew 3%. That clearly was below what we were expecting when we were at Q3 based on the cold and flu season. But the U.S. was down about 0.5%. APAC and EMEA, LatAm grew mid-single digits. Now we did experience a market slowdown. A vast majority of that was obviously what we’ve talked about in the U.S. market and then the cold and flu category, which I mentioned. Now remember, 70% of our cold and flu business is also outside the U.S. So in that context, we did deliver competitive performance. We outgrew the market overall and 60% of the business gained and maintained share.

Looking at 2026, we’re not planning on material improvement in the market. Consumers are likely to stay cautious. We’re absolutely focused on driving category growth. I’m confident we will continue and improve on our competitiveness. And that’s through investment in A&P, strong innovation plan, sharper commercial execution behind our new operating model. And listen, the U.S. will return to growth in 2026. And that’s based on the progress we’ve had to date. We ended the year where we expected to with inventories at the right place. And that’s — part of that is we did have softer cold and flu, but we had stronger Oral Health business, which helped offset that. And we also have plans in place that we know is going to help us improve through the year.

So for instance, in Q2, we have a lot of key customers doing shelving resets. We’re gaining distribution. We’re gaining shelf placement. On the profit side, the productivity program continues to deliver. You saw the 220 basis points of gross margin improvement. We feel great about that. That, combined with the efficiencies coming from the operating model, will allow us to deliver high single-digit operating growth at constant currency and still invest in growth, still invest in A&P, R&D and some key capabilities that we’re continuing to build on. So now if we step back and think the medium-term guidance. I mean you said it, the guidance doesn’t necessarily mean we’re going to be outside the range. But obviously, part of the guidance is outside our medium-term range.

I think it’s an acknowledgment of the uncertain market we’re dealing with. Based on what we know today, we’d expect to be in the middle of that range, based on what we know today. You also asked about the phasing. What we do know today is that Q1 cold and flu season is going to be below a year ago. We’re now almost 2 months into the quarter. And the results, we saw a spike towards the end of the year, and then we saw it come down after that. So we’re going to be below a year ago, and that’s not only in the U.S., it’s outside the U.S. My confidence, listen, these are still attractive categories. I still believe there’s huge potential. Everything we’ve talked about in the past, closing the instant treatment gap, success of our premiumization continuing, the low-income consumer opportunity, which we’re still only at the beginning at.

And as we progress through 2026, I expect to see stronger performance in North America, as I said and continued strength in emerging markets. We feel good about China, and I expect an acceleration in India. Actually, India for us is performing extremely well. And then as we continue to drive that productivity agenda, again, we will be able to continue to invest in the business, which again underpins my confidence in getting back to that 4% to 6% growth.

Operator: Our next question is from Warren Ackerman from Barclays.

Warren Ackerman: It’s Warren Ackerman here at Barclays. Outside of the numbers, Brian, could you talk about the new reorganization? You’ve got a new Chief Growth Officer, Chief Transformation Officer, new reporting structure, new hires in the U.S. other than Natalie I’ve seen. Can you maybe sort of walk us through how that’s going to be a growth unlock and how you’ll drive more volume growth in the U.S., more innovation? Anything you can say on sort of shelf resets and how the things are shaping up in the U.S. in what is clearly a tougher operating environment?

Brian McNamara: Thanks, Warren. And I think you captured it. This is first and foremost about unlocking growth and agility. And I think about the journey we’ve been on as a company, we’re now 3.5 years in as a company. The strategy we laid out is very clear. And there was still an opportunity for us to streamline and simplify the way we work and drive strategy to execution. So as you said, we created this Chief Growth Officer role that combines our category structure, our marketing effectiveness and capabilities, our business insights and analytics strategy and a new commercial excellence function. And then 6 operating units replacing our 3 regions. As you’re aware, Latin America, India and Middle East, Africa will now have a seat around the leadership team table.

So I think a couple of things. It’s one on the commercial execution function that we’ve created. Centrally, we’re driving AI-driven tools behind net revenue management, next best action. We’re going to be able to drive this quicker and faster through the organization. This structure of CGO, the 6 operating units, is going to allow us to really, really much quicker drive our category strategies through to execution, better leverage scale, better be able to move resources around, react to, what I would say, as you said, a very uncertain environment. And then as a result of it, we’re taking a layer out of the organization. So we’re talking about a flatter, leaner organization, and that leads to the $175 million to $200 million in gross savings we talked about, which gives us incredible flexibility, frankly, to invest in those growth opportunities and to invest in innovation and drive the capabilities.

Now your question on the U.S. — specifically on the U.S., yes, well, first of all, overall in the team, we did, as part of those changes, bring new members of the team. We got a fantastic leader in India, a fantastic leader in Latin America that came from outside the company who know these markets extremely well. Our Middle East, Africa leader is now sitting on the leadership team, and she’s an incredible talent. In the U.S., as part of all this, Natalie made a number of changes in our category heads or category general managers. So we have one of our top talents now on the OTC business. We brought external talent in Oral Health and in the Wellness category, which is a combination of VMS and Digestive Health. I mentioned it a bit earlier, Warren, but we know that in Q2, we will see across a number of key customers, some wins on distribution and shelving across Oral Health, VMS and Pain Relief, and that’s locked.

That’s going to happen in Q2, and we feel good about that commercial execution. We also feel good about the innovation. The one thing I will say, it’s broadly across the business, specifically in the U.S., Oral Health is doing incredibly well. And it really did better in Q4 than we expected, which again helped us offset, land the U.S. where we wanted to despite the tough cold and flu season.

Operator: Our next question is from David Hayes with Jefferies.

David Hayes: So just on emerging markets, there was a sequential slowdown in the fourth quarter. So just trying to dig a little bit deeper into whether the emerging is performing as you would expect it to be, like it to be at the moment. And then which areas specifically maybe are not doing as well? And I guess in that context, Oral Care continues to be amazing and impressive, obviously, still in this difficult consumer environment. So is there something different about Oral Care and the dynamics there versus some of the other categories ex Respiratory because of the cold and flu? But it feels like Oral Care could ride the consumer dynamic whereas the other brands can’t. Is there something you point to that says that this is what’s going to change as the consumer maybe picks up in the other areas?

Brian McNamara: Yes. Thanks, David. So listen, I will take the Oral Care question linking to other categories, and I’ll pass it to Dawn to talk about what we’re seeing more broadly in emerging markets. So first of all, we do feel really good, as you pointed about around Oral Care. And as we’ve been talking about now for a while, the clinical range in Sensodyne has really resonated well with consumers. And it’s beyond clinical white, it’s clinical repair, it’s clinical enamel strength. Beyond that, we’re seeing great progress in places like India with low-income consumer on Oral Health. And Parodontax is an amazing brand in gum health. We don’t talk about it as much as Sensodyne. It’s obviously not as big, but it’s growing in the strong double digit in the mid-teens.

We launched in China this past year. It’s still quite early in our ramp-up for distribution, but we couldn’t be happier with the progress that we’re seeing there. So we feel great about Oral Health. And the Oral Health model is very, very clear. It’s linked to the dental recommendation. It’s linked to the innovation. And obviously, we compete on the therapeutic side of the business. Listen, in the other categories, quite — listen, when we talk about the impact of cold and flu, to be clear, we talk about our cold and flu portfolio specifically, which are brands like Theraflu and Robitussin and Otrivin, which sit in that category. There is also impacts across other areas like Pain Relief and some VMS and things like that tend not to be as much but there does tend to be a little bit of that impact that happens, too.

Fundamentally, I believe these are real strong categories that as we move forward, we can move ahead. I think we’re just radically differentiated versus the competition in Oral Health in a way that’s very, very unique. We’re talking about now over 10 years of kind of high single-digit to double-digit growth in Sensodyne, and we continue to see that continuing to hum. And we’re seeing good competitiveness in the other categories, but we’re continuing to focus on innovation, things like our 12-hour patch launch on Voltaren in a number of European countries. Otrivin Nasal Mist continues to do well. We’re growing aggressive share there. Our OptiSorb technology on Panadol, we’re rolling out to another [indiscernible] market. So we feel like we have a good innovation plan that should underpin our — certainly our medium-term guidance.

Dawn?

Dawn Allen: Yes. Good morning, David. Hi, everyone. So let me talk a bit about emerging markets because we feel really excited about our emerging markets business. If I look at Asia Pac, first of all, I mean, we continue to deliver strong performance in Asia Pac. We expected an acceleration in half 2 versus half 1, and that has come through. And when I look at the growth drivers in Asia Pac, 80% of our growth is coming from volume mix. And that is a factor of us driving penetration and expanding reach across lower-income consumer groups. If I look within Asia Pac, let me talk about India. I mean, an incredible performance in India, double-digit growth in the year, an acceleration in quarter 4 on the back of the macro changes around GST, but also on the fact of our activations.

If I look at our INR 20 pack and Sensodyne is performing incredibly well. We continue to expand our reach across rural areas, across villages based on our investment in terms of bringing our sales force in-house. And actually, I was out in India the first week of this year, and it was great to be on the ground with the team, visiting stores and really seeing our brands come to life. So that was India. If I look at China, we’re also really excited about China, mid-single-digit growth in the year. And just some pockets to talk about. If I look at our e-com business, it’s around 40% of our business in China. And Douyin, we’re growing more than 100%. And our online to offline business is also growing double digits. So actually, we feel really good about China.

If I move on then to EMEA, LatAm. EMEA, LatAm, actually, we’ve seen a good performance, particularly across LatAm and EMEA, Middle East and Africa as well as Central Europe. But it is fair to say that whilst we’ve seen a good performance, particularly in LatAm and specifically Brazil, we are seeing a much more challenging macro backdrop, both in terms of the consumer behavior, but also in terms of retailer behavior as well. So we did see a slowdown in LatAm, particularly in quarter 4. And if I talk about kind of Middle East, Africa continues to perform well. Central Europe also has seen a good performance. But again, based on the soft cough, cold and flu season in quarter 4, we saw a slowdown in Central Europe because of that. But overall, as I said, we’re really excited about emerging markets.

It’s a huge growth opportunity for us. When I look at our A&P investment, half of our increase in A&P investment in the year actually went to emerging markets, and you can see that coming through in the performance.

Operator: Our next question is from Celine Pannuti with JPMorgan.

Celine Pannuti: My question comes back on the overall guidance and how you manage top line performance versus margin improvement. Clearly, strong delivery in margin and your cost savings initiative augurs well for the years to come. At the same time, your top line has disappointed. And if I look at the past 3 years, volume has been 1%, which is quite low compared to the overall European staples, best-in-class are trying to achieve at least 2% and above. So in order to grow 4% to 6%, what kind of volume level do you think you need to have? And how do you — like the discrepancy between margin progression and volume performance, does it mean that you may need to reinvest more or maybe look at your price positioning in order to grow volume faster?

Brian McNamara: No, thanks for the question, Celine. So let me kick that off, and then I’ll pass it to Dawn to give a bit more perspective. I think if you take a step back, I do think we’re investing in the right places on the business. If you look at our A&P investment in the last year, we were over 7% ahead of a year ago, and R&D was over 7% ahead of a year ago. That is the absolute benefit of the gross margin improvement and the improvements we’ve seen in our supply chain and structure, giving us 220 basis points of operating — of gross margin improvement, which is allowing us to invest in the business. We continue to focus on where is the best of that investment. By the way, a lot of that incremental investment this year went against Oral Health, and you see the results that have come out.

And we understand that in a lower cold and flu season, also while we can gain share, we’re going to have a very difficult time driving volume overall. But maybe, Dawn, you can talk a little bit about how we see the algorithm going forward and where we see the role of volume growth, which we’re very focused on volume growth. So Dawn?

Dawn Allen: Yes. Thanks for the question, Celine. And you’re right, and Brian mentioned it, we are very focused on driving volume growth in 2026 and moving forward. We’ve always said that the right price volume mix split for this business is around 60-40, 40-60. I already talked about Asia Pac in terms of 80% of that growth is coming from volume on Asia Pac, and we feel really good about that. When I look at EMEA, LatAm, if I take out the two shoulders of the year, so if I take out Q1 and Q4 for 2025, where we had a soft cough, cold and flu season, actually, in Q2 and Q3, we did see a more balanced price volume mix profile. And that obviously should give us confidence moving forward that we can deliver that. And then if I look at North America, look, it’s been a really challenging market in North America in 2025.

But as Brian has talked about, we have put in place the key actions to drive volume growth in 2026, whether it’s about us no longer doing destocking, whether it’s about reducing the drag from smokers health, the distribution builds that we expect to get from shelf resets as well as the strong activations. These are all important drivers in terms of driving the volume growth. So whilst for ’26, I’m not going to guide to specific volumes, I would expect us to be improving the split of price volume mix in ’26.

Operator: Our next question is from Olivier Nicolai with Goldman Sachs.

Olivier Nicolai: I got one question first. Could you go back to the change you have implemented in the U.S. over the last 12 months and specifically also the incentive structure you put in place for the new management there? And just following up on the press release on Page 5 regarding the overall equipment effectiveness. It has improved by 7 points in 2025. It’s a bit lower than what you expected at H1. Should we assume a stronger improvement in ’26 compared to ’25 on these metrics?

Brian McNamara: Yes. So thanks for the question. Let me talk a bit about the U.S. As you know, we announced a new leader in the U.S. in May. As we looked at our operating model structure broadly, we worked very closely as an executive team to define that. I talked a little bit earlier when Warren asked the question about that and we worked that very closely with the U.S. So one of the things we’ve done is we’ve created [indiscernible] category General Manager role, which obviously report directly up to our President of the U.S. and also are connected to our global category heads, which is going to help us really drive kind of this strategy to execution even faster. We’re making a number of changes around net revenue management and the tools that we’re providing.

We’ve made a number of changes in our sales force and our sales leadership and structure. And all of that was really pretty much done on January 8 when we announced the broader stuff in the U.S., you obviously move much faster on those kind of changes. So I feel really good about those changes and how they’re going to drive growth. And as I said, we’ve seen progress to date. There’s no question about it. We ended up again where we expected to. Inventories are kind of where we expected to. Oral Health has been extremely strong. Advil grew share in Q4. So that was a really important element. We’re seeing — we see these opportunities on the distribution and stuff that I talked about in Q2. So I feel like we’re in a very good place to really drive those changes in the U.S.

Dawn Allen: Yes. And I think, look, in terms of the productivity program, Brian talked about it, we’re really pleased with our supply chain productivity program. It was even better than we expected. I mean, 220 basis points improvement in gross margin is incredible in the year, and it is a collective effort across the whole organization. And that’s important because it helps to drive flexibility and agility in the P&L to be able to invest for growth. And if you remember, we talked about 3 drivers of how are we going to deliver that gross margin improvement and productivity benefit. The first one we talked about was immediate accelerators. So this was reducing complexity in our supply chain, whether it’s around number of languages on pack, harmonizing packaging, formulations.

And let me give you an example. So in Europe, in 2025, on our Aquafresh brand, we had 44 single language packs. And we’ve now reduced to 18 multi-language packs in the year. And that is a huge optimization piece in terms of supply chain. The second area that you referenced in your question was around operational efficiency. And this is all about debottlenecking upfront, process improvements, equipment optimization. And let me give you an example of that. In our Levice factory in Europe, we reduced formulations by 30%. So if you think about the impact of that, that reduces change over time, but it also increases the capacity, the available capacity on that line, which is really important. So I think, as I said, it’s an incredible effort that is helping us to continue to invest in the business to drive growth.

Moving forward, I wouldn’t expect to see, it would be great if we had that level of improvement each year. But moving forward, 50 to 80 basis points is what we’ve built into our guidance. That will be a strong performance on supply chain productivity.

Operator: Our next question is from Jeremy Fialko with HSBC.

Jeremy Fialko: So the one for me is more on the U.S. market more generally. So the first element is just the pharma channel within the U.S. Do you see that continuing to be under pressure in 2026? Or do you think with some of the ownership changes there, there’s the possibility that the channel could become a little bit better in some of the broader drops there, which have, I guess, led to pressure on inventories and overall sell-through could abate? And then maybe if you look at the U.S. more broadly, is it just a case of waiting for the consumer to get a bit better before the market growth can improve? Or are there some other elements that you think are kind of specific to the market getting a bit better, let’s say, putting aside any cold and flu impacts?

Brian McNamara: Thanks, Jeremy. Thanks for the question. Let me take that. I think as you talk pharmacy channel, really, what we’ve talked about is the 2 big retailers in the U.S., which is Walgreens and CVS. What I can say is we see the channel shift that we’ve seen for many years, which is drug channel and obviously, e-com. E-com growing quite aggressively and that’s walmart.com or that’s amazon.com, that will continue. The dynamic we saw in 2025 was lower inventory levels in those retailers as they were dealing with their own challenges. We believe we’re where we need to be, and now we’re just managing normal channel shift as we can. And by the way, that channel shift is not a bad thing for us. If we look at our Amazon shares, 18 brands on Amazon account for 90% of our business on Amazon and 16 of those 18 brands have higher share online than offline.

So as that channel shift moves, it’s something we can take advantage of. We have good capabilities there. So we feel good about that channel shift. Yet to be seen what happens under new ownership at Walgreens, if that’s a positive or not a positive. But again, I don’t feel like this is a situation that if gets worse, we baked it in. We proactively managed our inventory levels to try to be at a place where we felt good about so we can stop talking about it as we move forward. In the overall market, you said ex seasonality, so I will take that out because there’s certainly a seasonality impact that we’re kind of seeing. Listen, what we see in the dynamic is we see club channel doing a bit better, dollar channel doing a bit better as consumers are looking for more value.

Some consumers looking for lower price points, some consumers looking for — different consumer want value, higher price point, lower price per use. We’re very focused on those 2 channels and increasing our offering to make sure that we’re meeting the affordability issues of consumers in the U.S. And we believe we can also play a role, and we do play a role certainly in Oral Health in driving that category growth. So we’re not sitting back and waiting for the categories to change. We’re just acknowledging that we — there are some things we can’t control. We’re focused on competitiveness, growing market share. We feel confident in that, and we’re focused on driving that category growth where we can.

Operator: Our next question is coming from Sarah Simon with Morgan Stanley.

Sarah Simon: Just one question from me. How important is it in terms of securing shelf space and sort of with your retailer negotiations to have that cold and flu business? Because I think in your bit to become a sort of steady compounder with predictable top line, this is obviously the kind of bit that’s causing the biggest issue. So I’m just wondering how much do you need to own that business?

Brian McNamara: Okay. Sarah, thanks for the question. Let me take that. Listen, I think cold and flu plays an incredibly enormous role in consumer health and for consumers. And if you look over the history, I’ve been involved in the — in consumer health now for over 20 years. So I’ve seen quite a few cold and flu seasons. This year, we’re seeing kind of two seasons in a row that are down because if you remember last year, we were down. We know that Q1 is also going to be down. It doesn’t happen that often, but it has happened in the past. We’ve experienced that in the past. I believe if you look over time, you’re going to see growth in this category going forward. It’s a bit exasperated this year because we are dealing with multiple headwinds in the U.S. environment, which this has compounded on.

But I think it’s a very important category. We feel good about our positions in the category and our portfolio. I think it’s going to — it plays a very important role for our customers, too, as you were saying, this is category management around pain and cold and flu. And frankly, cold and flu and pain have some common brands, Panadol Cold and Flu, Advil Cold and Flu. So we think it’s an important part of the portfolio as we move forward.

Operator: Our next question is come from Karel Zoete with Kepler.

Karel Zoete: I’d like to go a bit deeper into 2 categories. The first one is the Digestive Health business. Historically, a good business for you, not so seasonal, but we’ve seen a slowdown in ’25. What should we anticipate for ’26? Why should things get better? And then coming back to pain, I know there’s a bit of cold and flu impact in there. But if you zoom out, 2024, ’25 have not been great years for pain despite of some of your strongest franchises such as Panadol in Asia are there. So what is needed for the pain franchise to start performing more in line with the anticipated growth rates?

Brian McNamara: Okay. Thanks very much, Karel. I appreciate the questions. So let me start with Digestive Health. If you think about our Digestive Health business, just to get us grounded, it is — over 80% of that business is focused in 3 countries: U.S., India and Brazil. In India and Brazil, it’s ENO, which is a fantastic brand and does very well in both cases and is part of our strategy and our growth strategy, certainly in both those countries and certainly in India. So now you get to the U.S. where we have Tums, we have Nexium, brands like Gasx and XLax, Benefiber, which is a fantastic brand. We have seen a drag on Nexium in the U.S. There’s no question that is one brand in one category, and we’re not alone in this that has been impacted by private label.

If I zoom out and look at the U.S. overall, we’ve gained share versus private label. But Nexium has been a bit of a challenge there. One of the opportunities we see in Digestive Health, and we feel really good about and we’re now working is supporting consumers on GLP-1s because there’s multiple side effects on GLP-1s that brands like Tums and brands like Benefiber address. There’s also side effects like dry mouth, which we have a mouthwash brand. We don’t talk about much in the U.S., Biotene, which is actually quite effective in dry mouth. And there’s nutritional supplementation, and we’ve actually created the Centrum variant that’s specifically focused to GLP-1 consumers. So we see an opportunity across our categories to drive that. Tums is a tremendously performing brand and so is Benefiber.

We have dealt with a little bit of a drag from the Nexium side of the business. Listen, on Pain Relief, it’s a great portfolio. I mean, Voltaren is #1 topical analgesic in the world. By the way, we talk about — a lot about the topical. We also have a very strong patch business. I mentioned earlier, we’re launching 24-hour patch in a number of markets around the world, and we’re seeing quite a successful pickup of that. Panadol has done quite well in Asia. We don’t have quite the same strength of a systemic pain relief business through Europe, and we’re addressing that. We’re launching there. And the big thing is on Advil. Like I said, we’re growing Advil share in Q4. We’re really confident that now with the new structure, with the new focus, our ability to invest and everything else that will get Advil back to a more consistent performer.

That’s going to be important for us. So that’s one of the things we need to make sure that we drive and deliver on the business. But overall, listen, we’ve always said the OTC categories in general would be 2% to 3% growth categories, and we could outgrow that. They’ve seen a little bit of headwinds here and in the U.S. as all categories have been a bit muted, again, not super declines, but a bit muted. So we’re addressing that, but we feel very good about that franchise and the global nature of that franchise.

Operator: Our next question is from Edward Lewis with Rothschild & Co Redburn.

Edward Lewis: Brian, just returning to the medium-term guidance. Should we think that getting back to that range is all about the U.S.? Or do you think you can deliver against that with a structurally slower U.S. market but greater contribution from the rest of the world, given the confidence you’re obviously expressing about India and China?

Brian McNamara: Yes. So listen, as I think about the medium-term guidance, I do expect that the U.S. will perform better. There’s two things. We’ve outperformed the market, to be clear, in 2025. But do I feel like the performance is — we’re hitting it on all cylinders? We have not. We can do better. Just outperforming the market isn’t enough, and I am confident we can do better. So we do expect an improvement in that U.S. environment. And I believe over the next couple of years, we’ll get that U.S. environment, if not too close to the bottom end of our algorithm growth. Outside of that, we also expect that, again, over time, emerging markets will continue to be a strong contributor and the low-income consumer strategy we have, which is taking hold in certain places, and we’re learning a lot, to be very clear.

And that takes a bit of time to kind of build up to be significant, and we see those opportunities. So overall, I do feel the medium term of 4% to 6% that nothing has fundamentally changed versus what we have said and what we’ve said in the past about our strategy and our opportunities. What you’re hearing from us this year is 3% to 5% because the market is still quite uncertain, and we want to make sure we’re providing the proper context for everyone on where we see things are at. And again, where we sit now, knowing Q1 is going to be softer due to cold and flu, middle of the range is kind of where we’re at on that, and we’ll update as the year goes on.

Operator: Our next question is from Tom Sykes with Deutsche Bank.

Tom Sykes: One quick follow-up and one on A&P, please. Are you able to quantify the shelf space stocking benefit that you’ll get in either Q1 or Q2 in North America, please? And then just on the A&P spend, I mean, there can’t be many consumer companies that have increased A&P by almost 8% to 20% of sales and still running at negative volumes. So where is the A&P ineffective? And where is it effective? And does it make much of a difference in your non-oral care businesses at the moment? And can you talk about whether you’re allocating more of that A&P increase to oral care or to non-oral care, please?

Brian McNamara: Thanks, Tom. Thanks for the question. Let me take the U.S. stocking, and I’ll pass it to Dawn on the A&P question. Listen, we’re not going to guide to specific improvements on the shelving increases. But let’s just say it’s part of the thing that gives us the confidence as we progress through the year that we’ll see stronger results because it’s real. Consumers will see more of our brands. We will have a bigger shelf space and in a number of cases, we’ll be at a better visibility point in some key resellers. Dawn, do you want to talk about A&P?

Dawn Allen: Yes. Look, thanks for the question. And I think it also builds on one of the comments that Celine talked about in terms of the margin profile as well. So let me say a few words about that. I think, look, it’s often easy for companies to cut A&P when the market is more challenging. We have not done that, and we haven’t done that because we’re really focused on ensuring the long-term sustainable growth for this business. So we — you’re right, we’ve increased A&P 7.5%. We’ve increased R&D 7.7% in the year. And we invest in our brands at a healthy and the right level to drive that sustainable growth. So if I kind of give a bit more color behind that. So what — where has that increase in A&P, where has it gone? We’ve already talked about it.

Half of that increase went to Oral Health. You’ve seen the growth momentum on that this year in terms of high single digit and acceleration in Q4 and the ROI on that Oral Health is incredibly strong. The other half, I referenced it earlier, went to emerging markets. So India, D-com in China, and that’s really important. And the third area actually is around experts. So expert is a critical part of our business model in terms of the work that we’re doing around the Haleon Health portal, where registrations have increased 27% in the year and on our field force engagement, which has also increased 16% in the year. So that’s where the spend has gone. The other thing that we are particularly focused on as well as ensuring it’s the right level is also around the return, the efficiency and the effectiveness.

So in the year, we’ve improved our working, nonworking split, so 12% growth in working media. We’ve also increased our overall ROI mid-single digit, and we’ve increased the coverage, the global coverage to around 3/4 of our business. The other thing that we’re focused on is also the mix. So 60% of our working media is allocated to digital. And that’s an important balance for us as we think about the shift in the broader economy. So I would say, overall, look, it’s an important focus area for us. We invest at a healthy level, 20.5%. I feel really good about that. And we also continue to focus on improving the efficiency and effectiveness of our spend as well as ensuring that we are shifting and having the right mix around digital versus legacy.

Brian McNamara: Okay. Super. Thanks, Dawn. Listen, I think we are going to close the call now. So thanks, everyone. I appreciate you joining us today. Look forward to catching up with all of you in upcoming meetings and roadshows. And please feel free to reach out to the IR team if you have any further questions. Really appreciate your continued interest and support in Haleon. Thanks, everybody.

Operator: Thank you. That concludes Haleon Fiscal Year 2025 Results Q&A. Thank you for your participation. You may now disconnect your lines.