HLN Haleon plc

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of February 2024

Commission File Number: 001-41411

Haleon plc

(Translation of registrant’s name into English)

Building 5, First Floor, The Heights,

Weybridge, Surrey, KT13 0NY

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

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INCORPORATION BY REFERENCE

This report on Form 6-K shall be deemed to be filed and incorporated by reference in the registration statement on Form F-3 (No. 333-273103) and the registration statement on Form S-8 (No. 333-267647) of Haleon plc and to be a part thereof from the date on which this report is furnished, to the extent not superseded by documents or reports subsequently filed or furnished.

EXHIBIT INDEX

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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Exhibit 99.1

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2023 Full year results

Twelve months ended 31 December 2023 (unaudited)

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Outlook

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For FY 2024 the Company expects

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Medium term guidance

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Over the medium term the company expects

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*Given the ongoing portfolio optimisation, we have moved guidance to organic operating profit growth as we believe this is more relevant to understand business performance, as well as aligned with existing revenue guidance

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Please note that we are unable to present reconciliations of forward-looking information for adjusted EBITDA, adjusted effective tax rate, adjusted operating profit, adjusted operating profit margin, organic revenue

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growth and metrics presented at constant currency because we are unable to forecast accurately certain adjusting items required to present a meaningful comparable IFRS forward-looking financial measure.

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Evolution into an agile consumer health organisation

As a standalone company we are continuing to take advantage of opportunities to evolve at speed across productivity, growth and portfolio

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These initiatives will provide us the capacity to invest and fuel our confidence in delivering on our 2024 and medium term guidance.  

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Capital allocation

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We have made significant progress against our guidance to be below 3x net debt/adjusted EBITDA during 2024, with high cash generation delivering FY 2023 leverage of 3.0x net debt/adjusted EBITDA (2022:3.6x).

Having achieved this immediate priority ahead of expectations we have reviewed our balance sheet efficiency and capital allocation priorities, and believe that the optimal leverage ratio over the medium term is around 2.5x net debt/adjusted. EBITDA. We believe that this is the right leverage to enable the business to appropriately balance our capital allocation priorities of continued investment for growth, optionality for M&A, as well as providing attractive shareholder returns and sustaining a strong investment grade credit balance sheet.

Consistent with this approach and our confidence in the strength of cash generation, we have today announced that we expect to allocate £500m of capital to share buybacks in 2024. This leverages our strong cash position, expected savings from our productivity programme, and will also utilise cash proceeds from the disposals announced over the last 9 months. This reflects our focus on strong capital discipline and will partially mitigate the dilution from the brand disposals. We intend to execute the buybacks either on the open market or off-market if the opportunity arises.  

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Dividend

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Reflecting the strength of the free cash flow and the progress in deleveraging since the demerger the Board is proposing a FY 2023 total dividend of 6.0p per ordinary share which represents a pay-out ratio of approximately 35% of FY 2023 adjusted earnings (ahead of prior commentary that this would represent an approximately 30% pay out). This includes a final dividend of 4.2p per ordinary share.

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Subject to shareholder approval, the final dividend will be paid on 16 May 2024 to holders of ordinary shares and US American Depositary Shares (ADS) on the register as of 15 March 2024 (the record date). The ex-dividend date is 14 March 2024. For ordinary shareholders wishing to participate in the Dividend Reinvestment Programme (DRIP), the election deadline for the DRIP is 17 April 2024.

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Going forward, subject to market conditions and Board approval, Haleon expects to grow its ordinary dividend at least in line with adjusted earnings.

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Foreign exchange

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Whilst we do not guide specifically on foreign exchange, assuming exchange rates as at 16^th February 2024 were to hold for the rest of 2024, the estimated unfavourable translational foreign exchange impact would be c. (2)% on revenue and c. (3)% on adjusted operating profit. This is largely driven by yoy movements in the US Dollar and Euro exchange rates against Sterling.

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Presentation for analysts and shareholders:

A recorded results presentation by Brian McNamara, Chief Executive Officer, and Tobias Hestler, Chief Financial Officer, will be available shortly after 7am GMT (8am CET) on 29 February 2024 and can be accessed at www.haleon.com/investors. This will be followed by a Q&A session at 9am GMT (10am CET).

For analysts and shareholders wishing to ask questions, please use the dial-in details below which will have a Q&A facility:

UK:+44 800 279 3956

US:+1 866 291 4166

All other: +44 (0) 207 107 0613

Passcode: 43700369

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An archived webcast of the presentation will be available later on the day of the results and can be accessed at www.haleon.com/investors.

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Financial reporting calendar

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Enquiries

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About Haleon plc

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Haleon (LSE/NYSE: HLN) is a global leader in consumer health, with a purpose to deliver better everyday health with humanity. Haleon’s product portfolio spans five major categories - Oral Health, Pain Relief, Respiratory Health, Digestive Health and Other, and Vitamins, Minerals and Supplements (VMS). Its long-standing brands - such as Advil, Sensodyne, Panadol, Voltaren, Theraflu, Otrivin, Polident, parodontax and Centrum - are built on trusted science, innovation and deep human understanding.

For more information please visit www.haleon.com

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Guiding strategy

Haleon is led by its purpose to deliver better everyday health with humanity.  

A clear approach to deliver on our growth ambitions is built on a world class portfolio of category leading brands in a growing sector across an attractive geographic footprint. This leverages Haleon’s competitive capabilities of combining deep human understanding with trusted science, along with strength in brand building and innovation, leading route to market and digital capabilities.

Haleon aims to outperform through a focus on increasing household penetration and capitalising on new and emerging growth opportunities across channels and geographies, underpinned by a strong focus on execution and financial discipline to improve profitability and sustain reinvestment in growth. Critically, running a responsible business, which is integral to all that we do, allows Haleon to reduce risk and support performance.

Taken together, this is expected to drive 4-6% organic annual revenue growth with organic operating profit growth ahead of this, whilst supporting our investment for growth, delivering consistent high cash conversion and maintaining a focus on our clear and disciplined capital allocation policy.

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Business review - Delivering strong growth

The strength of Haleon’s portfolio operating in an attractive sector combined with strong execution resulted in 4.1% reported revenue growth and 8.0% organic growth during the year. Across the portfolio and in the full year, 58% of Haleon’s business gained or maintained market share.

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Leading portfolio – performance driven by innovation, brand building and geographic and channel expansion

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Revenue by product category for the twelve months ended 31 December:

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1. Definitions and calculations of non-IFRS measures can be found on pages 22 to 31.

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In Oral Health, where revenue grew 6.1% on a reported basis and 10.6% organically (excluding a 4.5% decrease as a result of foreign exchange rates) to £3.1bn, Haleon continued to deliver market share gains, with all three Power Brands, Sensodyne, parodontax and Polident/Poligrip seeing double digit growth. Growth was supported by strong brand building campaigns and activation, key innovations and geographic expansion.

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Across Sensodyne, we launched Sensodyne Pronamel Active Shield which uses our most advanced enamel protection technology. This product builds on existing Pronamel technology by optimising the formulation to drive more fluoride into enamel, creating a remineralised surface that improves resistance to acidity. Initially launched in the first half of 2023 in the US, it is now in 5 markets and we will continue to roll this out in 2024 elsewhere. We also launched parodontax Active Gum Repair which has been clinically proven to help bleeding, swollen and inflamed gums to repair, helping reverse early gum problems. Early results show strong consumer uptake. In addition, we continued to see strong success from previous launches such as Polident Max Hold Plus which we launched in 2022, and is now present in over 25 markets driving strong growth of fixatives with consumption growing faster than the market.

In Vitamins, Minerals and Supplements, Haleon saw a 2.1% decline in revenue on a reported basis to £1.6bn with 0.9% organic growth (excluding a 3.1% decrease as a result of foreign exchange rates and a 0.1% decrease as a result of foreign exchange movements). Performance of Emergen-C was impacted by changes in consumer behaviour in the immunity subcategory, as consumers became less concerned about COVID-19 and where consumption has returned to pre-COVID-19 levels. Centrum delivered mid single digit growth for the year, and continued to benefit from leveraging its trusted science credentials driving growth in Centrum Silver. Following positive results from the three third party clinical studies demonstrating positive results on cognitive function of adults 65 years and older, we have successfully activated this claim with market share gains in the multivitamin segment.

We continued to expand our Centrum offering to new markets. Having launched Centrum in India through the e-commerce channel in October 2022 with a campaign to build awareness around multivitamin deficiency, we further expanded the portfolio to include Benefit Blends. Centrum remains the number multivitamin on Amazon in India (by revenue). We are now expanding the reach of the brand in this market and taking into bricks and mortar. During the year, we further expanded the Centrum range geographically into Sweden, and Middle East & Africa.

We continued to use our deep human understanding insights to evolve delivery formats and deliver new use occasions to make it easier for consumers to use our products. In the US, we launched Emergen-C crystals, a ‘no-water needed’ solution delivering key immune-supporting nutrients for adults and children which has performed well to date and was the #1 new innovation item in US in the Vitamin C and Immune Support vitamin segment in 2023.  

In Pain Relief, revenue increased by 4.0% on a reported basis to £2.7bn and organic revenue growth was 7.4% (excluding a 3.3% decrease as a result of foreign exchange and a 0.1% decrease from organic adjustments). Panadol and Fenbid saw standout performance.

Panadol benefitted from a good season and saw strong growth in EMEA and Australia as a result of the success of the new ‘Release starts here’ campaign. This campaign leverages the overall brand franchise, at the same time as addressing specialist need states such as migraine, body pain, night and headache. We continued to launch natural variants across a number of markets to expand our reach, with these launches designed to engage with a younger consumer base. Recent launches have included Panadol PanaNatra which we launched in Australia with encouraging results providing a platform for future innovation. Fenbid sales increased by over 50%, driven by the cessation of selling restrictions following the end of COVID-19 lockdowns in China as well as high COVID-19 incidence following this. In the second half of the year, inventory was managed down to pre-pandemic levels.

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In Advil, we further extended the range of Advil Dual Action to back pain, the third most common pain indication with positive consumer take up.

Haleon also launched Voltaren Liquid Capsules in Italy and expanded its penetration of 24 hour medicated patches. Furthermore, the brand launched Movement Coach in the UK, a digital health tool for people in pain and HaltungsCheck, an AI powered posture check tool built in conjunction with physiotherapists in Germany.

In Respiratory Health, where revenue increased by 9.9% on a reported basis to £1.7bn. Organic revenue growth was 13.7% (excluding a 3.8% decrease as a result of foreign exchange) reflecting strong growth, particularly in the first half given the strong cold and flu season at the start of the year and growth of Contac in China following the end of COVID-19 lockdowns. Growth was supported by strong execution and innovation of Theraflu, and in particular Theraflu Max+ which now comprise c. 25% of Theraflu sales in the US. Beyond this, we continued to see strong uplift from natural products launched in previous years such as Theraflu ProNatural. Across allergy, we expanded our offering with Flonase Nighttime Allergy Relief providing up to six hours relief from night time allergy symptoms. Haleon continued to innovate, and towards the end of the year, launched Otrivin Nasal Mist in three European markets, Poland, Portugal and Greece. This new exclusive technology to Haleon delivers a more comfortable consumer experience, with the release of a wide, gentle mist, and an easier side actuation method which aids consumers with hand dexterity challenges.

Digestive Health and Other revenue increased 2.0% on a reported basis and 6.5% organically (excluding the effect of a 4.0% decrease a result of foreign exchange moments and a 0.5% negative impact from organic adjustments). Revenue in this category is split across three areas: c.50% in Digestive Health, c.25% in Skin Health and c.25% in Smoking Cessation brands. Growth in Digestive Health was underpinned by strength in Tums and ENO which both saw double digit growth that were partially offset by a decline in Nexium. In Skin Health, double digit growth in Bactroban in China was a key growth driver.

Marketing and in market effectiveness  

Haleon Advertising and Promotion (A&P) spend was flat at actual exchange rates (AER) and up c.3% at constant currency (CER) for the year. We continued to drive further efficiencies, streamlining agencies for OTC and bringing production in house. During the year, we focused investment on key growth areas of the business, including mid single digit growth constant currency across Oral Health and Vitamins, Minerals and Supplements, partly offset by a decline in Respiratory Health. Additionally, spend was devoted towards key emerging markets including China and India, delivering strong return on investment. We expect growth in A&P spend constant currency in 2024 to be ahead of the rate in 2023.

During the year, a number of successful marketing campaigns supported performance with Haleon winning multiple awards globally across creative and design such as the Bronze European Effie for sustained success with the parodontax campaign.  

In market, we continue to work on optimising route to market and strengthening relationships with our customers. In the US we were awarded Walgreens Supplier Award: 2023 Health & Wellbeing Expertise, leveraging shopper insights from data driven marketing, new activations and channels to best reach and serve acute and chronic pain suffering shoppers. In Asia-Pacific we continue to invest in mini shopper science lab facilities, and now have four of these complementing the main facility in Singapore strengthening insights on shopper and consumer understanding. We also won various supplier awards with AS Watsons across a number

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of markets in the region. In EMEA and LatAm, Haleon was chosen as the number one supplier in the Advantage survey, the global supplier survey, in Spain, Brazil and Hungary, and top tier in many other mass markets.

Increased channel penetration

E-commerce grew 17% to 10% of total sales, with the two largest markets US and China having seen growth of 15% and 19% respectively. Improved content, optimised media, increased investment in high traffic events as well as refreshed ‘brand stores’ contributed to growth. Increased penetration remains an opportunity for the Group and an area where we continue to invest.

Supported by strong execution and financial discipline

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The business remains focused on driving sustainable growth and our growth agenda is fuelled by strong execution and disciplined cost management. This combined with sales growth and active portfolio management enables us to continue to invest in the business and deliver attractive returns.

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At the start of 2023, we announced a programme to increase agility and productivity across the business, focused on optimising existing processes and structures. Examples of initiatives included restructuring a number of individual functions and refining processes to be fit for purpose and increase agility. We continue to expect that this programme will deliver annualised gross cost savings of c. £300m largely in FY 2024 and FY 2025.

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During the year, the Group largely offset inflationary cost pressures through pricing and other initiatives. As a result reported gross profit increased by 2.6% with gross profit margin down 90bps to 59.7%. Adjusted gross profit constant currency was up 7.3% and adjusted gross profit margin across the business was down 30bps constant currency at 61.9%. This was a result of the impact of higher input cost inflation in the first half of year which subsequently reduced through the year. Consequently, adjusted gross profit margin at constant currency increased during the fourth quarter of the year.

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We continue to evolve our supply chain initiatives to increase agility, and to ensure that Haleon can readily meet demand from consumers. During the year, this was best demonstrated in China, where Fenbid and Contac saw strong growth at the start of the year following the lifting of COVID-19 related restrictions towards the end of 2022. Despite tight labour conditions arising from COVID-19 outbreaks, Haleon was able to double its manufacturing output at its Tianjin facility to ensure adequate supplies of these products to Chinese consumers and hospitals. Strong collaboration with partners ensured raw material supply to our facility.

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Across the business, Haleon undertook projects to rationalise SKUs and improve logistics productivity. Simultaneously, the business continued its insourcing initiatives, improved return on investment on promotional spend and optimised price-pack architecture across the portfolio.

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In India we successfully transitioned to a new distribution model following the termination of the sales and distribution agreement with Hindustan Unilever Limited towards the end of the year.  

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Consistent with our strategy to be active in managing our portfolio, we announced that we had reached a licensing agreement with Futura Medical to exclusively commercialise the first FDA approved topical erectile

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dysfunction (ED) treatment for OTC use in US. We continue to advance the launch plans in the US to bring this product to market and will update on timing when appropriate.

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Further to the completion of the Lamisil disposal to Karo Healthcare in 2023 for £235m, we also announced in January 2024 that we had reached an agreement to sell ChapStick to Suave Brands Company, a portfolio company of Yellow Wood Partners, for $430m, along with a passive minority interest in the Suave Brands company, valued at c. $80m at the time of agreement.

Run a responsible business

Running a responsible business is one of our strategic priorities, and our responsible business strategy is committed to making everyday health more inclusive, reducing our environmental impact, and operating with ethical and responsible standards of business conduct.

Progressing against existing environmental targets

We aim to reduce our net Scope 1 and 2 carbon emissions by 100% by 2030, based on a 2020 baseline. In 2023 we reduced our Scope 1 and 2 emissions by 48% and maintained our use of 100% renewable electricity in our directly owned and controlled sites. Initiatives to further increase our use of renewable energy included additional solar generation at two sites and replacement of a gas boiler with fully integrated heat pumps, alongside projects to increase energy efficiency at several sites.

Given more than half of our value chain carbon emissions are upstream in purchased goods and services, our suppliers are critical to the reduction of our source to sale Scope 3 emissions. During the year, we launched our Supplier ESG Expectations outlining targets that we want our suppliers to meet to drive upstream decarbonisation, such as moving to renewable electricity, completing a third party validated product carbon footprint for products supplied to Haleon and developing a carbon reduction plan.

We are also working to make our packaging more sustainable, and target for all product packaging to be recycle-ready by 2025 where safety, quality and regulations permit. We achieved the milestone of producing one billion recycle-ready toothpaste tubes from their initial launch in 2020, two years ahead of plan and estimate that 70% of our packaging is now recycle ready. Moreover, we launched a number of innovations using recycled plastic content, including manufacturing Centrum in the US with up to 100% recycled plastic in the bottle (not including the cap).

Opportunity to make a difference with health inclusivity

Haleon aims to empower 50 million people a year to be more included in opportunities for better everyday health by 2025 and has made significant progress towards this goal with over 41 million empowered in 2023.  

With a focus on empowering self-care, we continued to expand the reach of and content available on the Haleon Health Partner portal, an online database of tools and materials to support Health Professionals when they have conversations with patients. Our brands continue to take action with an aim to tackle barriers to health inclusivity. We launched the Advil Pain Equity project in the US with a long-term aim to help overcome the bias and prejudice that Black people in America experience when they seek pain management.

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Building healthier communities is critical to making everyday health more inclusive. We identify opportunities where we can have the most impact providing local, and global, donations through monetary, product, time and in-kind. During the year, we supported several community initiatives and emergency response efforts. For instance, following the earthquakes in Turkey and Syria we supported the efforts of our global humanitarian partner, Direct Relief, along with a donation of health and hygiene products. The local Haleon team also worked in collaboration with the Turkish Dentist Association to distribute oral health products and establish Oral and Dental Health Service Units across 25 points in the 11 cities of the impacted region.

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These examples represent only highlights of the ways our brands are bringing focus to Health Inclusivity through direct brand actions, support for Health Professionals and building actionable insights through research collaborations.

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Geographical segment performance

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Performance by geographical segment for the twelve months ended 31 December:

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1. Price and Volume/Mix are components of Organic Revenue Growth. Definitions and calculations of non-IFRS measures can be found on pages 22 to 31.

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Adjusted operating profit by geographical segment for the twelve months ended 31 December:

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1. Definitions and calculations of non-IFRS measures can be found on pages 22 to 31.

2. Reconciling items for these purposes are the Adjusting Items, which are defined under “Use of Non-IFRS Measures”. A reconciliation between Operating profit and Adjusted operating profit is included under “Use of Non-IFRS Measures”.

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Adjusted operating profit margin by geographical segment for the twelve months ended 31 December:

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1. Definitions and calculations of non-IFRS measures can be found on pages 22 to 31

2. Reconciling items for these purposes are the Adjusting Items, which are defined under “Use of Non-IFRS Measures”. A reconciliation between Operating profit and Adjusted operating profit is included under “Use of Non-IFRS Measures”.

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North America

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Europe, Middle East & Africa (EMEA) and Latin America (LatAm)

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Asia-Pacific (APAC)

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Summary of financial performance (unaudited)

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Income statement summary

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Revenue

Revenue increased 4.1% to £11,302m (FY 2022: £10,858m). Adverse foreign exchange had a £416m impact on total revenue.  This was largely driven by the Pound Sterling strengthening against the Argentine Peso, the Chinese Renminbi and other emerging market currencies. The net impact of M&A and MSAs had a £10m adverse impact largely from the disposal of Lamisil which completed in October 2023. Revenue grew 8.0% organically for FY 2023.

Gross profit

Reported gross profit increased by 2.6% to £6,747m (FY 2022: £6,577m) with gross margin down 90bps to 59.7%. Adjusted gross profit increased by 3.4% or 7.3% at constant currency to £7,001m (FY 2022: £6,772m) with Adjusted gross margin of 61.9% (FY 2022: 62.4%).

Adjusted gross profit was driven by pricing and ongoing supply chain, and manufacturing efficiency benefits. This helped offset higher commodity related costs and cost inflation which particularly impacted performance in the first half. During the second half of the year, these headwinds eased resulting in growth in adjusted gross profit margin in the fourth quarter.

Operating profit

Operating profit increased by 9.4% to £1,996m (FY 2022: £1,825m) and operating profit margin increased 90bps to 17.7% (FY 2022: 16.8%). Adjusted operating profit increased by 3.1% to £2,549m (FY 2022: £2,472m) or 10.4% at constant currency. Excluding the impact of net M&A, adjusted operating profit

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increased 10.8%. Adjusted operating profit margin declined 20bps and increased 50bps at constant currency to 22.6%. Adjusted operating profit growth was driven by strong revenue growth, partly offset by higher commodity and raw material costs, and cost inflation.

For the year, A&P spend was flat, and up c. 3% at CER representing 17.9% of revenue (2022: 18.7%). A&P spend represented focused investment on key growth areas including mid-single digit growth (constant currency) in Oral Health and Vitamins, Minerals and Supplements, partly offset by a decline in Respiratory Health. Adjusted R&D expenditure was £297m (2022: £303m), down 2.0% and (0.7)% at CER representing a healthy level of spend into innovation and investment into a number of clinical studies resulting in 86 publications supporting our expert engagement and product claims.

Adjusting items within operating profit totalled £553m in FY 2023 (FY 2022: £647m) and primarily related to the amortisation and impairment of intangible assets of £224m (FY 2022: £172m), restructuring costs of £169m (FY 2022: £41m), separation and admission costs of £120m (FY 2022: £411m) and disposals and other items of £40m (FY 2022: £23m).

Net finance costs

Net finance costs were £368m (FY 2022: £207m). This reflected finance costs of £402m (FY 2022:  £258m), primarily related to the annualisation of interest on the issuance of £9.2bn in notes in March 2022 and finance income of £34m (FY 2022: £51m).

Tax charge

The statutory tax charge of £517m (2022: £499m) represented an effective tax rate on IFRS results of 31.8% (2022: 30.8%). The 2023 tax charge includes a £155m non-cash charge related to intragroup transfers. The 2022 tax charge included a £102m non-cash charge due to the revaluation of US deferred tax liabilities given the increase in the blended rate of US state taxes that applies due to the demerger.

The tax charge on an Adjusted basis was £512m (2022: £506m) and the effective tax rate on an Adjusted results basis was 23.5% (2022: 22.3%).

Profit after tax

Profit after tax attributable to shareholders of the Group was £1,049m (FY 2022: £1,060m) and Adjusted profit after tax attributable to shareholders was £1,607m (FY 2022: £1,700m), down 5.5% at AER and up 2.5% at constant currency. The increase at constant exchange rates was driven by 10.4% growth in adjusted operating profit which was partly offset by the annualisation of interest costs and the higher tax rate described above.

This resulted in diluted earnings per share of 11.3p (FY 2022: 11.5p) and adjusted diluted earnings per share of 17.3p (FY 2022: 18.4p).

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Net debt

At 31 December 2023, the Group’s net debt was £8,514m.  Net debt is calculated as follows:

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As of 31 December 2023, the Group’s senior unsecured long-term credit rating was BBB from Standard and Poor’s Global Ratings and Baa1 from Moody’s.

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CONSOLIDATED INCOME STATEMENT

FOR THE YEAR ENDED 31 DECEMBER (unaudited)

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER (unaudited)

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¹ Includes tax on fair value movements on cash flow hedges of £(2)m (2022: £(48)m), netted off by tax on reclassification of cash flow hedges to the income statement of £6m (2022: £4m).

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CONSOLIDATED BALANCE SHEET

AS AT 31 DECEMBER (unaudited)

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER (unaudited)

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¹ Equity shareholders refer to GSK and Pfizer, which held equity interests of 68% and 32% in the Group respectively prior to the demerger.

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CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER (unaudited)

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Appendix

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The unaudited financial information shown in this preliminary results announcement was approved by the Board on [28] February 2024. The financial information set out in the preliminary results announcement does not constitute the Group’s statutory accounts for the financial years ended 31 December 2023 or 31 December 2022. The financial information for the year ended 31 December 2022 is derived from the Annual Report and Form 20-F 2022 which was published on 20 March 2023. The auditor’s report on the 2022 accounts is included within the annual report; their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498(2) or (3) of the Companies Act 2006. The audit of the Group’s statutory accounts for the year ended 31 December 2023 is not yet complete. These 2023 statutory accounts will be finalised on the basis of the financial information presented by the Board in this preliminary results announcement. The 2023 statutory accounts will be delivered to the UK Registrar of Companies in due course.

Cautionary note regarding forward-looking statements

This document contains certain statements that are, or may be deemed to be, "forward-looking statements“ (including for purposes of the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934).  Forward-looking statements give Haleon’s current expectations and projections about future events, including strategic initiatives and future financial condition and performance, and so Haleon’s actual results may differ materially from what is expressed or implied by such forward-looking statements. Forward-looking statements sometimes use words such as "expects“, "anticipates“, "believes“, "targets“, "plans", "intends“, “aims”, "projects“, "indicates", "may", “might”, "will", "should“, “potential”, “could” and words of similar meaning (or the negative thereof).  All statements, other than statements of historical facts, included in this presentation are forward-looking statements.  Such forward-looking statements include, but are not limited to, statements relating to future actions, prospective products or product approvals, delivery on strategic initiatives (including but not limited to acquisitions and dispositions, realisations of efficiencies and responsible business goals), future performance or results of current and anticipated products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, dividend payments and financial results.

Any forward-looking statements made by or on behalf of Haleon speak only as of the date they are made and are based upon the knowledge and information available to Haleon on the date of this document. These forward-looking statements and views may be based on a number of assumptions and, by their nature, involve known and unknown risks, uncertainties and other factors because they relate to events and depend on circumstances that may or may not occur in the future and/or are beyond Haleon’s control or precise estimate. Such risks, uncertainties and other factors that could cause Haleon’s actual results, performance or achievements to differ materially from those in the forward-looking statements include, but are not limited to, those discussed under “Risk Factors” on pages 202 to 210 in Haleon’s Annual Report and Form 20-F 2022. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements.

Subject to our obligations under English and U.S. law in relation to disclosure and ongoing information (including under the Market Abuse Regulations, the UK Listing Rules and the Disclosure and Transparency Rules of the Financial Conduct Authority ("FCA")), we undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should, however, consult any additional disclosures that Haleon may make in any documents which it publishes and/or files with the SEC and take note of these disclosures, wherever you are located.

No statement in this document is or is intended to be a profit forecast or profit estimate.

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Use of non-IFRS measures (unaudited)

We use certain alternative performance measures (APMs) to make financial, operating, and planning decisions and to evaluate and report performance. We believe these measures provide useful information to investors and as such, where clearly identified, we have included certain alternative performance measures in this document to allow investors to better analyse our business performance and allow greater comparability. To do so, we have excluded items affecting the comparability of period-over-period financial performance. Adjusted Results and other non-IFRS measures may be considered in addition to, but not as a substitute for or superior to, information presented in accordance with IFRS and may not be directly comparable with similar measures used by other companies. Additionally, we are unable to present reconciliations of forward-looking information for non-IFRS measures because we are unable to forecast accurately certain adjusting items required to present a meaningful comparable IFRS forward-looking financial measure.

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Changes to APMs

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In 2023, we introduced organic operating profit growth as a new APM. Organic operating profit growth differs from our presentation of adjusted operating profit growth as it is further adjusted for the effects of acquisitions, divestments, MSAs, and exchange rates. Management believes that presenting organic operating profit growth contributes to the understanding of the Group’s performance in a meaningful and consistent way as well as aligning with our organic revenue growth measure. The new APM was effective from 1 January 2023 but we have presented alongside 2022 comparatives.

Beginning in 2024, our organic revenue growth calculation will cap pricing in excess of 26 percent per annum for countries experiencing hyperinflation. For Haleon, this will apply to Argentina and Turkey. Corresponding adjustments will be made to all income statement related lines when calculating organic growth changes.

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Additionally, we are no longer presenting free cash flow conversion and net capital expenditure as APMs since they are simply a mathematical derivation of free cash flow in proportion to profit after tax and an aggregation of cash flow line items, respectively.

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Adjusted Results

Adjusted Results comprise Adjusted cost of sales, Adjusted gross profit, Adjusted gross profit margin, Adjusted selling, general and administration (SG&A), Adjusted research and development (R&D), Adjusted other operating income/(expense), Adjusted operating expenses, Adjusted operating profit, Adjusted operating profit margin, Adjusted net finance costs, Adjusted profit before tax, Adjusted income tax, Adjusted effective tax rate, Adjusted profit after tax, Adjusted profit attributable to shareholders, Adjusted diluted earnings per share. Adjusted results exclude net amortisation and impairment of intangible assets, restructuring costs, transaction-related costs, separation and admission costs, and disposals and others, in each case net of the impact of taxes (where applicable) (collectively the Adjusting items).

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We believe that Adjusted Results, when considered together with the Group’s operating results as reported under IFRS, provide investors, analysts and other stakeholders with helpful complementary information to understand the financial performance and position of the Group from period to period and allow the Group’s performance to be more easily comparable.

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Adjusted Results include the benefits of restructuring programmes but exclude significant costs (such as significant legal, restructuring and transaction items). They should not be regarded as a complete picture of the Group’s financial performance, which is presented in the Group’s reported results. The exclusion of other Adjusting items may result in Adjusted Results being materially higher or lower than reported results.

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In particular, when significant impairments, restructuring charges and legal costs are excluded, Adjusted Results will be higher than reported results.

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Adjusting items

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Adjusted Results exclude the following items (net of the impact of taxes, where applicable):

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Net amortisation and impairment of intangible assets

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Net impairment of intangibles, impairment of goodwill and amortisation of acquired intangible assets, excluding computer software. These adjustments are made to reflect the performance of the business excluding the effect of acquisitions.

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Restructuring costs

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From time to time, the Group may undertake business restructuring programmes that are structural in nature and significant in scale. The cost associated with such programmes includes severance and other personnel costs, professional fees, impairments of assets, and other related items.

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Transaction-related costs

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Transaction-related accounting or other adjustments related to significant acquisitions including deal costs and other pre-acquisition costs, when there is certainty that an acquisition will complete. It also includes the costs of registering and issuing debt and equity securities and the effect of inventory revaluations on acquisitions.

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Separation and admission costs

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Costs incurred in relation to and in connection with separation, UK Admission registration of the Company’s Ordinary Shares represented by the Company’s American Depositary Shares (ADSs) under the Exchange Act and listing of ADSs on the NYSE (the US Listing). These costs are not directly attributable to the sale of the Group’s products and specifically relate to the foregoing activities, affecting comparability of the Group’s financial results in historical and future reporting periods.

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Disposals and others

Includes gains and losses on disposals of assets, businesses and tax indemnities related to business combinations, legal settlement and judgements, the impact of changes in tax rates and tax laws on deferred tax assets and liabilities, retained or uninsured losses related to acts of terrorism, significant product recalls, natural disasters and other items. These gains and losses are not directly attributable to the sale of the Group’s products and vary from period to period, which affects comparability of the Group’s financial results. From period to period, the Group will also need to apply judgement if items of unique nature arise that are not specifically listed above.

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The following tables set out a reconciliation between IFRS and Adjusted Results for the year ended 31 December 2023:

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The following table shows the adjusting items to reconcile cost of sales to Adjusted cost of sales.

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The following table shows the adjusting items to reconcile operating expenses to Adjusted operating expenses among the relevant components thereof.

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The following table shows the adjusting items to reconcile diluted earnings per share to Adjusted diluted earnings per share.