Haleon PLC - Annual Report 2025 | FinancialReports.eu

Haleon PLC

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Annual Report

and Form 20-F

2025

Strategic Report

Haleon at a glance

2025 highlights

Chair’s statement

Our business model

Chief Executive Officer’s review

Our strategy

Market drivers

Our categories

Our approach to health inclusivity

and sustainability

Climate and nature-related

financial disclosures

Section 172 statement and

stakeholder engagement

Our culture and people

Our key performance indicators

2025 Finance review

Our approach to risk

Viability statement

Statement of compliance

Corporate Governance

Our Board of Directors

Our Executive Team

Letter from the Chair

Governance structure

Board activities

Workforce engagement

Audit & Risk Committee Report

Environmental & Social

Sustainability Committee Report

Nominations & Governance

Committee Report

Directors’ Remuneration Report

Compliance with the UK

Corporate Governance Code

104

Consolidated

Financial Statements

Statement of Directors’

responsibilities

105

Independent auditor’s report

106

Report of independent registered

public accounting firm

119

Consolidated income statement

121

Consolidated statement of

comprehensive income

122

Consolidated balance sheet

123

Consolidated statement of

changes in equity

124

Consolidated cash flow statement 126

Notes to the Consolidated

Financial Statements

127

Parent Company

Financial Statements

Parent Company balance sheet

169

Parent Company statement of

changes in equity

170

Notes to the Parent Company

Financial Statements

171

Other Information

Directors’ Report

175

Group information

179

Shareholder information

193

Exhibits

197

Form 20-F cross reference

199

Climate and nature-related

disclosures cross reference

202

Forward-looking statements

204

Use of non-IFRS measures

205

Glossary

211

Useful information

212

Contents

What’s inside

We deliver better everyday health

with humanity — combining

trusted science, consumer insight,

and global expertise.

Our purpose drives sustainable

growth by improving health outcomes,

expanding access, and building

confidence in self care, ensuring our

brands make a measurable difference

in people’s lives around the world.

haleon.com/investors

Our approach to reporting

Integrated reporting

In addition to our shares being listed

on the London Stock Exchange (LSE),

Haleon is a foreign private issuer (FPI)

with American Depositary Shares (ADSs)

listed on the New York Stock Exchange

(NYSE). We have produced a combined

Annual Report and Form 20-F to ensure

consistency of information for both UK

and US investors. This Report contains

disclosures required to meet both

regulatory regimes.

The Report also includes non-IFRS

measures, which we believe provide

investors and other stakeholders with

important additional information about

the Company’s performance. Where

used, they are indicated.

External websites and/or reports that

are referred to in this Report are not

incorporated into and do not form part

of this Report.

Relevant policies are available on

our website

www.haleon.com/

who-we-are/Governance/codes-

policies-and-standards

Our key stakeholders

Consumers

Customers

Employees

Investors

Health Professionals

Suppliers

Governments and industry regulators

Portfolio of leading brands in resilient categories

Haleon at a glance

A world-class consumer company

focused on

better

everyday health

Six market

See also our

approach to health inclusivity and sustainability

key performance indicators

2025 finance

review

approach to risk

, and

Board activities’

sections, on pages 15, 40, 42, 50 and 65.

Consumer first

We focus on understanding the consumer

and prioritising solutions that meet their health

needs. This helps us to develop fit-for-purpose

innovation and communication, and to enhance

our engagement with Health Professionals who

help educate consumers. There is a huge

opportunity to create products that improve

people’s quality of life, not just treat their

health needs.

Trusted science

We leverage the technical and scientific

expertise of our scientists, and are investing

c. £200m in a new cutting-edge R&D facility.

Our regulatory excellence is world class, and we

continue to advance this to shape the future of

healthcare policy and regulation, innovate with

new digital solutions, and actively support

product licences. Science is at the heart of our

brands, and we are going to continue investing

here, but in new digital ways. In addition to our

high-quality clinical studies, we are expanding the

use of ‘real-world-evidence studies’ to provide

robust insight into both usage and quality-of-life

benefits of products for our consumers.

Pharmacy channel expertise

Pharmacies are considered a first point of care

for consumers. Our geographic footprint and

extensive sales force give us strong reach in this

channel, where recommendation of trusted health

products matters. We have direct relationships

with pharmacists, anchored in: offering best-in-

class shopper experience through a variety of

tools and solutions; leading category growth

via our in-store execution programmes; and

educating and partnering with pharmacists to

best engage with their customers, enriched

with digital capabilities.

Strategic

Report

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Market drivers

Consumer Health is an attractive,

evolving sector supported by

long-term macro trends

Socioeconomic and

geopolitical

dynamics shifting

Consumer needs

evolving

Channel landscape

evolving

Regulatory dynamics

changing

Global population growth is

driven by Asia and Middle East

and Africa, with India having

overtaken China in population

size. Emerging-market

urbanisation and middle-class

expansion, and developed-

market income polarisation, are

driving self-care. Geopolitical

risks, tariffs and currency

fluctuations also impact

affordability and supply chains.

Chronic conditions are becoming

more common, driven by ageing

populations, and environmental

and behavioural factors. Online

channels are becoming a key

source of health information

and health specialists are still

influencing purchasing decisions

Demand is also increasing for

holistic health solutions

, digital

tools, ingredient transparency,

efficacy and credibility.

Grocery, drug and traditional

pharmacy channels are under

significant pressure, with

increasing input costs.

Meanwhile, shifts to ecommerce

and eB2B are accelerating. As a

consequence, retailers and

online platforms are using data

and technology to shape their

offerings, pricing and consumer

experience.

Health systems are shifting

towards self-care and expanding

the role of pharmacies to

manage strong self-care demand,

health-worker shortages and cost

pressures. Regulations are also

increasing – with stronger scrutiny

of health claims, tighter ingredient

safety and transparency, and

increasing ESG regulations and

reporting requirements.

53%

of Consumer Health market

growth comes from

emerging markets

1.4bn

people will be aged 60+

by 2030

23%

of Consumer Health sales are

made online

18m

global health-workers

shortage expected by 2030

Broader sector dynamics

The Consumer Health sector continued to

emerge and evolve in 2025. Opella became

a standalone Consumer Health company,

following the completion of Sanofi’s sale of a

controlling 50% stake to private equity firm

Clayton, Dubilier & Rice. Following Kenvue’s

listing as a fully-independent company,

Kimberly-Clark announced its intention to

acquire Kenvue and create a $32bn global

health and wellness company. In parallel,

Consumer Health companies are actively

reshaping their portfolios: Church & Dwight

and Nestlé engaged in strategic reviews of

their VMS businesses; and Procter & Gamble

recently acquired Digestive Health brand

Wonderbelly. Reckitt divested its Essential

Home business (retaining a 30% equity stake),

to become a simpler consumer health and

hygiene company. Businesses in the sector

include Bayer, Church & Dwight, Colgate-

Palmolive, Kenvue, Nestlé, Opella, Procter &

Gamble, Reckitt and Unilever, along with

local players. While the sector is highly

competitive, Haleon has been able to

differentiate itself through its purpose

and Win as One strategy, underpinned by

consumer understanding, trusted science

and pharmacy channel expertise.

Haleon is well positioned. As socioeconomic and geopolitical

dynamics shift, we see growing opportunities to drive reach and

optimise our supply chain. We have strong positions in attractive

categories, which help us address evolving consumer needs and

regulatory trends. We are investing in digital and technology,

and have competitive strengths in pharmacies and with experts,

to help us adapt to the evolving channel landscape.

Source: NIQ, ‘Global State of Health and Wellness’,

2025.

Nicholas Hall’s global CHC database, DB6 (2024),

GlobalData (2024).

World Health Organization.

Euromonitor.

Haleon

Annual Report and Form 20-F 2025

Our categories

Oral Health

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Innovation-led premiumisation

Expanded Sensodyne Clinical range globally.

Clinically proven to whiten teeth

by two shades

and provide 24/7 sensitivity protection

, Sensodyne Clinical White

is now available in more than 25 markets and is ranked as a top 10 innovation in

the US Oral Health market.

Expanding reach

Improved access to Oral Health in emerging markets.

Introduced an affordable

Sensodyne Cavity + Sensitivity toothpaste in 15 markets, including Indonesia and

South Africa, addressing affordability barriers, and supported by online activation.

Scaling innovation

Expanded Gum Health innovation globally.

Building on its successful 2024

launch, we expanded parodontax’s distribution in China

, contributing to the

brand’s global double-digit growth

Expert recommendation

Strengthened scientific leadership in Gum Health Sensitivity care.

Presented

two sessions at ‘EuroPerio 11’, attended by over 10,000 dental professionals,

around evidence-based care for dentine hypersensitivity and gingivitis.

Superior innovation

Enhanced Denture Care performance

, with the rollout of Poligrip Ultimate

‘All in One’ across Europe, US and Japan

. It offers 263% stronger hold

, our best

biting power

and clinically-proven comfort with 12-hour hold. The launch

achieved around 5% market share in Japan within seven months of launch

and

ranked as the #1 Denture Care innovation in the US

See page 47 for further information on performance

during the year.

2025 revenue

£3,461m

4.5%

growth

7.9%

organic growth

Our brands

The importance of Oral Health

According to the World Health

Organization (WHO), nearly half of the

world’s population is affected by oral

diseases or conditions, with cases

increasing by c.1 billion

over the past

30 years. Poor Oral Health not only leads

to discomfort and pain, it also increases

the risk of noncommunicable diseases

such as diabetes, obesity and

cardiovascular diseases. Oral Health

conditions are, in most cases,

preventable and treatable, if managed in

their early stages. Tooth sensitivity and

gum disease are widespread (each with

c.45–50% prevalence

), yet treatment

rates remain low, with for example only

around a third of consumers

using a

specialist toothpaste for each condition.

Our position

We focus on premium, specialist

Therapeutic Oral Health with broad

geographic presence. Haleon is the

global #1

in Sensitivity toothpaste

(with Sensodyne), #2

in Gum Health

toothpaste (with parodontax), and #1

in Denture Care (with Corega/

Polident/Poligrip).

Source: World Health Organization, Global Oral Health Status Report, 2022.

Source: Sensodyne Haleon Incidence & Usage Study, 2022, across 10 markets; parodontax Global U&A

Refresh 2022 Clear.

Source: GlobalData (2024), the latest available data for the Consumer Health as a whole, beyond our

individual categories, and Haleon analysis of third-party market data. Share rankings shown are based on

value sales for the year ended December 2024.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (2024). Data set is based

on Haleon global category standards.

Versus a non-whitening toothpaste after 8 weeks’ twice daily brushing.

With twice daily brushing.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (October 2025 year to

date). Data set is based on Haleon global category standards.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (MAT, September 2025).

Data set is based on Haleon global category standards.

Versus no adhesive at 1 hour.

10.

Includes Poligrip’s best biting-power technology.

11.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (March to September

2025). Data set is based on Haleon global category standards.

12.

Source: Circana, LLC, Total US – MULO+ with Convenience, Denture Care Category, 2025 Innovation: Y,

Dollar Sales, CY Ending Dec 28, 2025.

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our categories

continued

Vitamins, Minerals &

Supplements (VMS)

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Innovation-led premiumisation

Continued our expansion across Asia-Pacific of our Centrum Daily Kits range,

a 30-day supply of tailored vitamins for gender and age needs. The range now

features added premium benefits including cellular health and metabolism

support, delivering the largest innovation for Centrum globally.

Expanding reach

Accelerated access to Centrum range for lower-income consumers,

via growth

of our Centrum Essential Benefit range of Multivitamin, Energy and Immunity

solutions. The range continued to attract new consumers to the category and

Centrum brand in Brazil.

Superior innovation

Launched Caltrate Kids Liquid

in China, with a patented Vitamin K2 formulation

for ten times better absorption, supported by key-opinion-leader content to

enhance education and build consumer trust in digital commerce.

Claims backed by evidence

Launched new, superior cognition claim for Centrum Silver

in the US, that

‘Taking Centrum Silver may slow cognitive ageing up to 60%’, amplified by digital

activation and influencer support.

Expert recommendation

Enhanced expert activation for Centrum.

Continued inviting experts globally,

and across the US and Southeast Asia, to ‘Think Again’ about Multivitamin

benefits. Over 85% of experts in the Philippines who took part stated that they

would be likely to recommend Centrum Multivitamin to their patients.

Meaningful and different brands

Expanded the Emergen-C brand in the US.

Launched a new master-brand

campaign, ‘So much more than Vitamin C!’, highlighting Emergen-C ingredients

beyond vitamin C (including B vitamins, zinc and electrolytes), driving share growth

in the market.

See page 47 for further information on performance

during the year.

2025 revenue

£1,685m

(0.6)%

growth

1.9%

organic growth

Our brands

The importance of VMS

Health and wellness is a top priority for

consumers, with particular interests in

need states such as nutrition, cognition,

longevity and weight management. Good

nutrition also serves as the foundation

for other health and wellness needs.

However, the majority of the global

population do not consume enough

micronutrients essential to health. Our

ambition is to enable consumers to take

control of their health and wellness with

trusted, science-backed supplements

that fill critical nutrient gaps.

Our position

Haleon is the #1 player in VMS globally

Our key brands include: Centrum – the

world’s leading Multivitamin

; Caltrate

– world leader in Calcium

; and

Emergen-C – world leader in Vitamin C

Source: Nicholas Hall’s global CHC database, DB6 (2024) and Haleon analysis of third-party market

data, the latest available data for the Consumer Health market as a whole, beyond our individual

categories.

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Haleon

Annual Report and Form 20-F 2025

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Geographic expansion

Expanded Voltaren 2% into China

Launched Voltaren 12-Hour Pain Relief Gel in

China, driving market share growth in Pain Relief in that market

Meaningful and differentiated brands

Launched a new campaign for Advil US.

‘No Pain, More Gain’, which went back to

the root strength of the brand, efficacy. It launched in July and delivered positive

share performance even in the first 12 weeks

Expert recommendation

Partnered with medical experts to advance the understanding of pain.

launched the Haleon Pain Management Institute (HPMI) in 15 countries across

the globe, in collaboration with local Health Professionals. This initiative reflects

Haleon’s commitment to accelerate the science and understanding of pain for

better pain management and outcomes.

Brilliant execution

Scaled Voltaren’s sponsorship approach.

Voltaren became the official licensed

pain killer of the UEFA Champions League, a first for Haleon, Voltaren and UEFA.

The campaign, designed to strengthen Voltaren’s relevance among younger, active

consumers, culminated at the final in Munich in May 2025 and was activated

across broad media channels, including in-store displays and an experiential zone

within the stadium.

Pain Relief

The importance of Pain Relief

Pain is a consistent and universal issue,

affecting over 90%

of the adult

population. Yet six in ten

people wait

before treating it, while only one in

three

people seek relief from their pain

immediately. When we fail to manage

our pain, many aspects of our health

can suffer, for example we exercise less,

move less and struggle to sleep. The

social and emotional impacts of pain

continue to increase, with stigma and

social isolation arising from everyday

pain increasing worldwide

. We aim to

break down the barriers to seeking Pain

Relief, to support better everyday health

for everyone.

Our position

Our portfolio spans Systemic and Topical

sub-categories, with strong brands

including Voltaren, Panadol, Advil,

Excedrin, Fenbid and Grand-Pa.

Source: Haleon Global Pain Index, 2023, 5th Edition.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (12 months to

September 2025). Data set is based on Haleon global category standards.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (2025). Data set is

based on Haleon global category standards.

See page 47 for further information on performance

during the year.

2025 revenue

£2,564m

–%

growth

2.3%

organic growth

Our brands

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our categories

continued

Respiratory

Health

The importance of Respiratory Health

Respiratory Health is a key pillar of

everyday health, with the common

cold being one of the most common

infectious diseases

, having a high impact

on people’s quality of life and global

economies. Many consumers seek out

self-care options for common cold-

related symptoms, with 70%-80% of

sufferers feeling confident in treating

themselves for these conditions

, yet

over 40% do not utilise Over-the-

Counter (OTC) treatments

. Our ambition

is to close the incidence vs treatment gap

with our portfolio of trusted brands.

Our position

Our portfolio spans a range of Cough,

Cold and Allergy sub-categories, with

strong brands including Otrivin, Theraflu,

Flonase and Robitussin.

Source: Harvard Health, 2023.

Source: Global Self-Care Federation, 2024.

Source: The Consumer Healthcare Association, 2023.

Source: Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al

(November 2025 year to date). Data set is based on Haleon global category standards.

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Innovation-led premiumisation

Continued the global expansion of our superior Otrivin Nasal Mist.

launched this in a further 10 countries in 2025, including in Italy, Norway and the

US. It was also launched under our Theraflu brand in the US

. The continued

roll-out drove global consumption growth in 2025 ahead of the market

Innovation-led premiumisation

Received industry recognition for Nasal Mist innovation.

Theraflu Nasal Mist

won the ‘Best in Show 2025’ Ameristar design award for its innovative side-

actuated spray – offering comfort, precision, accessibility and safety-compliant

packaging. It also recently won a WorldStar Global Packaging Award 2026 in

the US.

Meaningful and different brands

Theraflu strengthened demand power.

We continued Theraflu’s award-winning

‘Right to Rest and Recover’ multi-year initiative in the US and Poland, to champion

the right for workers to take time off when they fall sick. This consistently-lived

purpose helped build relevance with the consumer and strengthen Theraflu’s

brand demand power among those exposed to the campaign.

Health inclusivity and sustainability

Making our packaging more sustainable.

We are progressing with the transition

to using mass balance bio-based resins for the production of Otrivin nasal sprays,

which delivered incremental virgin petroleum-based plastic savings in 2025.

See page 47 for further information on performance

during the year.

2025 revenue

£1,873m

(11.7)%

growth

(1.9)%

organic growth

Our brands

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Haleon

Annual Report and Form 20-F 2025

2025 revenue

£987m

(4.1)%

growth

0.5%

organic growth

Our brands

Digestive

Health

See page 47 for further information on performance

during the year.

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Delighting consumers

Grew Tums’ household penetration.

In the US, expansion of a new format

(Chewy Bites) and retail exclusive flavours, supported by digital commerce

acceleration, attracted new, young consumers to the category and lowered

barriers to treatment.

Innovation-led premiumisation

Expanded Benefiber to new consumers for proactive digestive wellness.

Benefiber Prebiotic Fiber + Supergreens targets GLP-1 users, to help close the fibre

gap related to low-calorie diets and support energy levels. Activation included an

influencer programme designed to engage GLP-1 consumers, complemented by

in-store activations across key retailers.

Meaningful and different brands

Drove growth with a new Benefiber campaign.

Successfully launched a new

master-brand communication for the Benefiber brand, ‘Grow what feels good’,

reinforcing proactive gut health through fibre. It helped drive Benefiber growth at

more than twice the rate of growth of the Fibre category.

Innovation-led premiumisation

Continued to grow ENO ‘3 in 1’ in India, gaining significant share.

Launched in

2024, it combines the trusted relief of ENO, as India’s #1 Antacid Immediate Relief

brand

, with natural ingredients – cumin, carom seeds and black salt. It provides a

one-stop solution, for fast and effective relief to treat multiple symptoms (acidity,

gas and indigestion).

Expanding reach

Improved access to Digestive Health in Brazil with a new, convenient and

affordable format

. Continued the expansion of Digestive Health products in

Brazil with ENOMAGNO stick pack format, a new brand tailored for the

Magnesium Hydroxide liquid range. It offers the same product in a convenient,

single-dose, on-the-go format, with lower out-of-pocket vs the regular format

(bottles). ENOMAGNO stick pack drove market share gains

in the liquid segment,

with more than 80% of stick-pack consumers being new to the category.

The importance of Digestive Health

Digestive Health issues affect a large

proportion of the global population.

For example, over 60% of adults in the

US experience digestive health issues.

A healthy digestive system ensures that

the body effectively absorbs nutrients,

vitamins and minerals from food, which

are essential for maintaining energy

levels, supporting immune function and

promoting overall health. The Digestive

Health category includes proactive

solutions that complement the VMS

category, such as fibre, as well as

reactive treatments, like antacids and

laxatives. There is growing consumer

demand for Digestive Health solutions,

driven by increased awareness of the

importance of gut health, as well as

the increase in GLP-1 use

Our position

Haleon is the #1

manufacturer in the

global Digestive Health category, driven

by our leading position in Antacids.

We have a focused geographic presence

in Digestive Health across key markets –

US, India and Brazil (representing c.85%

of sales) – underpinned by brands such

as Tums, ENO and Benefiber.

Source: NIQ, ‘Global State of Health and Wellness’, 2025.

Source: Nicholas Hall’s global CHC database, DB6 (2024) and Haleon analysis of third-party data (2024),

the latest available data for the Consumer Healthcare market as a whole, beyond our individual

categories. Digestive Health refers to the Gastrointestinals category.

Haleon’s analysis of third-party data including IQVIA, Circana, Nielsen et al (November 2025 year to

date). Data set is based on Haleon global category standards.

Source: IQVIA, OTC consumption report, July-September 2025.

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

2025 revenue

£460m

(9.8)%

growth

2.0%

organic growth

Our brands

Therapeutic

Skin Health

& Other

See page 47 for further information on performance

during the year.

The importance of Therapeutic

Skin Health & Other

In 2021, skin and sub-cutaneous

diseases affected 25% of the population,

up by over 35% since 1990, contributed

to by lifestyle, environmental and climate

change factors. They disproportionately

affect women, children, older adults and

disadvantaged groups, often leading to

stigma and discrimination. However,

awareness remains low – both among

Health Providers and the general public.

In 2025, WHO Member States adopted

a resolution to recognise skin diseases

as a global health priority

. Our aim is

to help consumers better manage

their conditions, to deliver better

everyday health.

Our position

Our Therapeutic Skin Health & Other

brands consist of key brands such as:

Zovirax/Abreva – the global leader in

Cold Sore treatments; Bactroban – the

leading Wound-Healing brand in China;

and Fenistil – the top Anti-Itch solution

in EMEA & LATAM. Outside of

Therapeutic Skin Health brands,

our key ‘Other’ brand is Eroxon.

Source: World Health Organization, 2025.

Source: IQVIA, OTC consumption report, July-September 2025, topline L1M data showing

11% market share and #2 position in September 2025.

Source: IQVIA OTC consumption report, L6M Oct 2026.

Activity examples

Key growth driver and 2025 activities

Market

driver(s)

Closing the incidence vs treatment gap

Further expanded the Bactroban brand beyond antibacterial ointment in

China.

Bactroban launched Adapalene Gel in 2024, as an acne treatment for face,

chest and back, and has already achieved the number two position in the acne

market in China

Expert recommendation

Advanced Bactroban leadership in China county areas via a treatment and

education campaign.

Bactroban engaged dermatologists in providing free mobile

dermatology clinics and educational events, delivering healthcare and wellbeing

to consumers’ doorsteps via county hospitals. The initiative also included training

sessions for dermatologists on various skin conditions. This helped strengthen

consumer and expert awareness, and Bactroban’s number one position in wound

healing in the county

Claims backed by evidence

Leveraged expert-led communication to drive growth of Abreva,

with the

launch of a new digital campaign in the US. The campaign featured a board-

certified dermatologist as the brand spokesperson. It was centred around the

claim, ’5 in 1 multi-symptom cold sore relief’, to support consumers with faster

healing and relief from pain, burning, itching and tingling.

Market drivers

Socioeconomic and geopolitical dynamics shifting

Consumer needs evolving

Channel landscape evolving

Regulatory dynamics changing

Our categories

continued

Haleon

Annual Report and Form 20-F 2025

Our approach to health inclusivity and sustainability

Health inclusivity

and sustainability

Our goals

2025

performance

2024

performance

We aim to empower millions of people a year

to be more included in opportunities for

better everyday health, empowering

50 million people a year by 2025

74m+

50m+

We aim to reduce our net Scope 1 and 2

carbon emissions by 100% by 2030 vs a 2020

baseline

(55)%

(50)%

We aim to reduce our Scope 3 carbon

emissions from source to sale by 42% by 2030

vs a 2022 baseline

(13)%

(9)%

We aim to reduce our use of virgin

petroleum-based plastic by 10% by 2025,

and a third by 2030 vs a 2022 baseline

2,5

(9)%

(1)%

We aim to develop solutions for all product

packaging to be recycle-ready by 2025 and

recyclable or reusable by 2030, where safety,

quality and regulations permit

2,5,6,7

80%

79%

We aim for all key agricultural, forest and

marine-derived materials used in our

ingredients and packaging to be sustainably

sourced and deforestation-free by 2030

90%

81%

We aim to achieve TRUE certification

at all

our manufacturing sites by 2030

11/24

5/24

We aim to achieve Alliance for Water

Stewardship (AWS) standard certification at

all our manufacturing sites by 2025

24/24

12/24

We aim to achieve gender parity in leadership

roles by 2030

46.3%

44.6%

Further information on our

Health Inclusivity and Sustainability strategy

Double Materiality Assessment

and

2025 performance

can be found in

our

2025 Health Inclusivity and Sustainability Report

For further information on our reporting criteria, see Haleon’s

2025 Health

Inclusivity and Sustainability Basis of Reporting

The reporting periods for Scope 1 and 2 carbon emissions (market-based) and health inclusivity are 1 December (in the prior year) to 30 November (in the year stated). The annual reporting periods for Scope 3 emissions, plastic, packaging and sustainable

sourcing are 1 July (in the prior year) to 30 June (in the year stated). The annual reporting periods for TRUE (Total Resource Use and Efficiency) certification, AWS certification and the baseline comparison years are calendar year. Gender representation is as at

31 December in the year stated on the basis of an average as at the end of each quarter.

The end point for the 2025 goal is the end of the 2025 calendar year.

Scope 1 and 2 emissions performance reflects market-based emissions under Haleon’s

operational control. Carbon offsets were used to reduce 11% of our location-based Scope 1 and 2 emissions in 2025. Our Scope 1 & 2 goal is underpinned by a 95% absolute reduction target. Scope 3 estimated emissions includes all indirect emissions from

Haleon’s value chain and all GHG Protocol categories except 6, 7 and 10-15.

The 2024 Scope 3 result and 2022 baseline differ from the value (2024: (10)%) in the 2024 Annual Report and Form 20-F due to methodology and data improvements, including

updated emission factors and granular data for products made at third-party manufacturers. While the change in the Scope 3 result is not material, the change in split of emissions across the GHG protocol categories is material. The restated Scope 3 result

better reflects the drivers of our footprint and where we are focusing our actions.

Scope of our estimated packaging footprint includes product packaging and some devices, including toothbrushes.

The stated performance is against the 2025 recycle-ready

goal only.

The reported result against the recycle-ready goal does not exclude packaging where there is not a recycle-ready solution that meets stringent safety, quality and regulatory requirements for healthcare packaging.

The 2024 result differs from the

value, 74%, disclosed in the 2024 Annual Report and Form 20-F due to packaging data improvements at internal sites and inclusion of granular data for products made at third-party manufacturers.

Scope includes Haleon’s globally managed spend on key

materials which are agricultural, forestry or marine-derived. Globally managed spend covers the majority of our internal spend and expands across some of our third-party manufacturing network.

10.

TRUE, is a recognised zero-waste certification programme.

11.

Haleon has 25 manufacturing sites. The increase from 24 sites last year is due to the Company now treating its two sites in Suzhou, China as separate sites for operational purposes. 24 of our 25 manufacturing sites are included in our AWS and TRUE

certification goals. Maidenhead is excluded as it ceased manufacturing operations towards the end of 2025.

12.

Gender parity is defined as between 48-52%. Since 2025, this metric does not include the US and Puerto Rico. The 2024 result has also been

updated to exclude these, hence the 2024 result shown differs from the value of 45.2% disclosed in the 2024 Annual Report and Form 20-F and the 2024 Responsible Business Report. Percentage indicates the percentage of female permanent employees.

KPMG LLP has issued independent limited assurance over the selected data indicated using assurance standards ISAE(UK) 3000 and ISAE3410. KPMG LLP’s limited assurance conclusion is available at

www.haleon.com

/our-impact/esg-reporting-hub.

In 2025, we refreshed our Health Inclusivity and

Sustainability strategy, putting improving health

inclusivity at the centre, reflecting where we

believe we can have the most impact.

Our purpose is to deliver better everyday health with

humanity. But today too many people are held back from

this due to lack of knowledge, access to affordable care

and bias and prejudice. Changes to the environment are

also impacting people’s health, with the most vulnerable

hit first and hardest. That is why improving health

inclusivity is central to our strategy. By building health

literacy, increasing access to everyday-health products,

tackling bias and prejudice, and providing solutions to

help people manage the impact of environmental

changes, we can help millions of people take more

control of their everyday health. Because we know when

people have the knowledge, tools and confidence to

care for their health, it strengthens families, communities

and health systems.

We also recognise that our long-term success is

dependent on the health of people, the natural world

and the shared resources we all rely on. That is why we

are focused on reducing our environmental footprint and

operating with enduring resilience across our value chain.

We do this by: cutting carbon emissions, making our

packaging more sustainable, managing natural resources

responsibly and by supporting our people and partners.

Through these actions we can help people achieve

better everyday health today and tomorrow, while

mitigating risks and generating industry-leading returns

for our shareholders.

All of this is anchored on upholding robust ethical

standards: from operating responsibly, embedding high

quality and safety standards to protecting human rights.

These standards guide our actions and safeguard the

trust that underpins our brands.

These priority areas are the focus of our refreshed

Health Inclusivity and Sustainability strategic framework

and were confirmed by the results of our updated

Double Materiality Assessment, taking account of the

requirements of the EU Corporate Sustainability

Reporting Directive (CSRD) and the European Sustainability

Reporting Standards (ESRS) (enacted prior to 2025) in

preparation for potential future reporting by the Group

and/or by our companies.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our approach to health inclusivity and sustainability

continued

For health inclusivity…

When people are enabled to take better

care of their everyday health it shapes

how they feel and their quality of life –

today, and into the future. Yet we

recognise and understand the social

and environmental challenges that still

hold many back from achieving better

everyday health.

That is why improving health inclusivity

is central to our sustainability strategy

and reflected in an updated goal

and ambition:

By 2030, we aim to provide

opportunities for over

300 million people a year

to take more control

of their everyday health.

We are making this happen by:

—

Building health literacy,

because

knowledge and confidence changes

behaviour. We are equipping people

with the information and resources

they need to take more control of

their health.

—

Increasing access to everyday

health products,

because everyday

health should be within everyone’s

reach. We are making more affordable

and accessible versions of our

products available to more people.

—

Tackling bias and prejudice,

because

everyone deserves to be seen, heard

and treated fairly. We are challenging

negative stereotypes which hold

people back from better everyday

health.

In 2024, a year ahead of schedule,

we reached our target of empowering

50 million people a year to be more

included in opportunities for better

everyday health.

In our 2025 reporting period, we

empowered more than 74 million people

to be more included in opportunities

for everyday health, by focusing on:

Building health literacy

We invested in deepening the breadth,

quality and reach of content on the

Haleon Health Partner Portal (HHP). One

of the year’s most important additions

was the integration of The Haleon Pain

Management Institute (HPMI) resources.

These materials, shaped by new market

insights, are designed to help Health

Professionals recognise and address

KPMG LLP has issued

independent limited

assurance over the

selected data

indicated using

assurance standard

ISAE(UK) 3000.

disparities in pain awareness, treatment

access and patient confidence. In 2025,

we continued to provide resources to

help Health Professionals build their

patients’ knowledge and confidence

in how to manage everyday health

conditions through webinars and

downloadable resources. Content

includes deeper condition specific

education, new resources for

pharmacists, dentists and doctors, and

expanded training materials addressing

bias and prejudice, including on the

‘#ListenToPain’ initiative. In our 2025

reporting year, Health Professionals

engaging with content on the portal

went on to empower over 52 million*

people globally.

Our Health Inclusivity and Sustainability strategic framework

‘In our 2025 reporting

period, we empowered

more than 74 million

people to be more

included in opportunities

for better everyday

health.’

For health

inclusivity...

With enduring

resilience...

Deliver better everyday health with humanity

Upholding robust ethical standards

We help people take

more control of their

everyday health

Building health literacy

Increasing

access to everyday

health products

Tackling bias

and prejudice

Supporting our people

and our partners

Managing natural

resources responsibly

Making packaging

more sustainable

Cutting carbon emissions

We work with respect for

people, nature and

resources

Haleon

Annual Report and Form 20-F 2025

Increasing access to everyday

health products

We are committed to making it easier

for consumers on low-incomes to access

the healthcare products they need – for

example, the more accessible version

of our Sensodyne toothpaste in India,

where we offer a smaller pack size priced

at 20 rupees, to make it much more

accessible to lower income consumers,

many of whom are daily-wage earners.

By offering this more accessible version

and extending distribution, we have

more than doubled our reach in small

towns and villages across India.

We are also expanding our reach in key

markets. Working in collaboration with

dental colleges and Health Professionals

across India, ‘Project Amplify’ expands

access to essential oral health services.

Since launch, the programme has

supported free dental evaluation at over

800 clinics nationwide, ensuring

individuals receive not only check-ups

but also practical, personalised advice to

manage daily hygiene habits. To reach

people beyond clinic walls, we

introduced a QR-based code, to facilitate

at-home oral health checks. This simple

digital tool allows individuals to assess

their oral health using their mobile

phones, broadening engagement and

removing barriers to care. Since 2023,

‘Project Amplify’ has empowered more

than 600,000 people to improve their

oral health through accessible,

community-centred support. The

programme continues to grow year on

year, reaching 330,000 individuals in our

2025 reporting year.

We will report on the increasing access

to everyday healthcare products’

component of our updated 2030 Health

Inclusivity goal from 2026.

Tackling bias and prejudice

In the US, we continued to scale

Theraflu’s ‘Right to Rest and Recover’

campaign which advocates for

nationwide paid sick leave and helps

citizens better understand their rights.

Since 2021, the programme has provided

over $1 million in micro grants to help

people who could not otherwise afford

to do so take a day off to recover from

everyday illness. In 2025, the programme

helped more than 10 million*

adults

living in the US to feel better informed

about their rights to paid sick leave with

many already acting on the information

provided by the campaign or intending to

act differently when they next fall sick.

…With enduring resilience

Cutting carbon emissions

Scope 1 and 2

In our 2025 reporting period, we

achieved a 55%* reduction in net Scope 1

and 2 carbon emissions compared to our

2020 baseline, exceeding the PSP target

of a 48% reduction, see page 95, and

maintained 100% renewable electricity

across our operations*. In line with our

SBTi target, almost a quarter of our 25

manufacturing sites

have now reduced

their market-based Scope 1 and 2

emissions by at least 95%

, compared to

2020. We continue to reduce our use of

offsets, aiming to limit their use to ≤5%

by 2030. We reduced the use of offsets

from 14% of gross Scope 1 and 2

location-based emissions in our 2024

reporting period, to 11% in our 2025

reporting period.

In 2025 we invested more than

£12 million in energy efficiency and

carbon reduction projects. Progress

includes the installation of an electric

steam generator at our Kuala Lumpur site

in Malaysia and one at our Nairobi site

in Kenya, and installation of new electric

heat pumps at both Suzhou sites

in China.

Scope 3

In our 2025 reporting period, Scope 3

emissions from source to sale decreased

by 13% from the 2022 baseline, showing

continued progress towards our

SBTi-validated target to reduce Scope 3

emissions, source to sale, by 42% by

2030. As part of this decrease, upstream

transport and distribution emissions

reduced by 31% versus 2022, primarily

due to a reduction in the use of air

freight. Purchased goods and services

remain the main driver of our Scope 3

emissions overall.

In March 2025, we organised a

Sustainability Forum, with over 320

supplier representatives attending. This

event provided a platform for shared

learning and dialogue on sustainability

challenges and opportunities across our

supply network. To further support

supplier capability, we have delivered

a series of targeted training modules.

KPMG LLP has issued

independent limited

assurance over the

selected data

indicated using

assurance standards

ISAE(UK) 3000 and

ISAE3410.

Internal Haleon study,

supported by

Edelman.

Haleon has 25

manufacturing sites.

The increase from

24 sites last year is

due to the Company

now treating its two

sites in Suzhou, China

as separate sites for

operational purposes.

Excludes emissions

from refrigerants and

company vehicle

mileage.

Based on actual

results as of 30

September 2025,

already surpassing the

target of (10)% by end

of 2025. Reporting

period is 1 July 2024

to 30 June 2025.

These sessions have addressed key

topics including energy efficiency,

energy management, decarbonising

industrial heat processes and

cascading decarbonisation efforts

through additional tiers of the

supply chain.

To improve the granularity of our

Scope 3 emissions reporting, we

updated methodologies, enhanced

our data quality, and updated emission

factors, switching to supplier specific

product carbon footprints where

possible. To enable us to clearly

communicate the impact of improved

data we have restated our 2024 result

from (10)% to (9)% and our 2022

baseline (see page 15).

Making packaging more sustainable

We have made good progress

against our virgin petroleum-based

plastic goal, reaching a (9)%* reduction

in our reporting period up to the

end of June 2025, and exceeded our

goal to reduce our use of virgin plastic

by 10% by the end of the 2025

calendar year

. This reduction is being

delivered through the continued

rollout of initiatives which replace

virgin plastic with alternatives including

recycled plastic, bioplastic and

cellulose or paper based packaging.

We exceeded our goal to reduce our use of

virgin plastic by 10% at the end of the 2025

calendar year.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

This includes the roll out of toothpaste

tube caps made using bioplastics in

several markets, and the increased use of

bottles made using recycled plastic or

bioplastic in our OTC, VMS and Digestive

Health bottles.

We have met our 2025 goal to develop

solutions for all product packaging to

be recycle-ready where safety, quality

and regulations permit in line with our

2025 external goal and PSP target

(see page 95) – reaching 80%* across

our product portfolio in the reporting

period. This was driven by the continued

global roll out of recycle-ready

toothpaste tubes, and the continued

conversion of our bottle portfolio –

including most mouthwash bottles –

to recycle-ready packaging. For the

remaining 20% of our product packaging,

we expect progress on recycle-ready

to increase only marginally going

forward, due to limited to no availability

of recycle-ready solutions in the near

future which meet the stringent safety,

quality and regulatory requirements for

healthcare packaging.

During 2026, we will revisit our 2030

goal to make all packaging recyclable

or reusable, where safety, quality,

regulations permit, to align with the

latest industry developments, including

the Ellen MacArthur Foundation 2030

plastics agenda for business and the

EU Packaging and Packaging Waste

Regulation.

Managing natural resources

responsibly

Sourcing trusted ingredients

sustainably

We are making continued progress

towards our goal for all key agricultural,

forest and marine-derived materials used

in our ingredients and packaging, to be

sustainably sourced and deforestation-

free by 2030

We increased our percentage of

sustainably-sourced key materials to 90%

in the 2025 reporting period, primarily

driven by an increase in certified

deforestation-free paper as well as

an increase in sustainably-sourced corn

and wheat derivatives enabled by

improved supplier data and evidence.

We strengthened our performance on

sustainably-sourced palm oil derivatives

to 94% and paper to 82%.

These results reflect our current

definition of ‘deforestation free’ (as

available in our 2025 Health Inclusivity

and Sustainability Basis of Reporting).

We will continue to monitor external

developments and update our

definitions in line with evolving

regulation and industry standards.

Since launch in 2023, our ‘Healthy Mint

Supply Chain’ programme in Uttar

Pradesh, India, has enrolled over

10,000 farmers across the state. Large

gains in yields have been reported by

farmers adopting improved planting

techniques, utilising new mint varieties

and those trialling new technologies,

including the use of drones to spray

controlled measures of fertilisers,

reducing their use.

Integrating water stewardship

and waste circularity

In 2025, we reached our goal of

achieving Alliance for Water Stewardship

(AWS) core certification across all our

manufacturing sites. We will continue

to monitor and track compliance with

AWS standards.

We are now focusing beyond our own

manufacturing sites to the wider water

context, taking a long-term view to

protect business continuity and help

ensure that supply chains are resilient

to climate-related impacts. To do this,

we are engaging key suppliers and

third party manufacturers in water

stressed areas

, in understanding

and managing their water impacts.

We are also working to identify

programmes and collaborations at basin

level, to enable our eight sites located in

water-stressed areas to become water

neutral by 2030. Our Cape Town site

achieved water neutrality in 2023, and

our site in Nairobi, Kenya is starting a

programme in 2026 to become water

neutral.

We are introducing measures at our

manufacturing sites to increase waste

circularity through the TRUE (Total

Resource Use and Efficiency) certification

system. Six of our sites have achieved

TRUE waste certification this year,

bringing the total certified to 11 out

of 24.

Our approach to health inclusivity and sustainability

continued

KPMG LLP has issued

independent limited

assurance over the

selected data

indicated using

assurance standards

ISAE(UK) 3000 and

ISAE3410.

Scope includes

Haleon’s globally

managed spend on

key materials which

are agricultural,

forestry or

marine-derived.

Globally managed

spend covers the

majority of our internal

spend and expands

across some of our

third-party

manufacturing

network.

Determined using

publicly available

tools to identify water

risk, such as the WRI

Aqueduct Tool,

site-specific reviews

of local water risk

using local data, and

materiality of the risk

to the business.

Discover

more…

Empowering and

supporting people

Please see page

35–39 of this report

and our 2025 Health

Inclusivity and

Sustainability report.

Upholding robust

ethical standards

Please see page 38

of this report and

our 2025 Health

Inclusivity and

Sustainability report.

Our ‘Healthy Mint Supply Chain’ programme

in Uttar Pradesh, India, has enrolled over

10,000 farmers across the state since the launch

of the programme in 2023.

Haleon

Annual Report and Form 20-F 2025

Improving health inclusivity while

operating sustainably and responsibly

is a strategic imperative for Haleon.

We are transforming how we work to

build resilience across our value chain

and reduce our environmental

footprint.

We rely on fully-functioning operations

and supply chains to make and sell our

products, as well as key agricultural,

forestry and marine-derived materials

from our upstream supply chain to

make our products and packaging.

As a result, we assess and manage the

environmental risks and opportunities

associated with matters including climate

change and nature loss, which could

have a financial impact on our business

and our long-term success.

Compliance statement

In accordance with the FCA’s UK Listing

Rule 6.6.6R(8), the Companies Act 2006

s.414CB(A1) and (2A) and the SEC’s

Guidance Regarding Disclosure Related

to Climate Change (2010), we present our

Task Force on Climate-related Financial

Disclosures (TCFD) compliance statement

and confirm that we have made

climate-related financial disclosures

for the year ended 31 December 2025

which are consistent with the TCFD

recommendations and recommended

disclosures, on pages 202 and 203.

Last year we committed to early

adoption of the Taskforce on Nature-

related Financial Disclosures (TNFD)

recommendations and guidance.

Acknowledging this is a journey, in our

first disclosures we report our progress

against the TNFD framework following

our enterprise-wide nature LEAP

(Locate, Evaluate, Assess and Prepare)

assessment completed in 2025.

Prompted by TNFD, this exercise helps

us to understand our dependencies,

impacts, risks and opportunities related

to nature. We will continue to use the

findings to guide our strategy and

decision-making moving forward.

Please see pages 202 and 203 in the

appendix of this document for the full

climate-related and nature-disclosures

content mapping index.

Governance

Governance over climate and nature-

related risks and opportunities is

consistent with the governance

structures in place across Haleon –

comprising of the Board, Board

committees, executive and management-

level governance committees, and

specialist working groups across the

business.

The Board takes overall accountability

for risk and opportunity management,

including climate change and nature

(page 65). The Board delegates specific

matters related to climate change and

nature to committees, as detailed in the

Board Committee reports on pages 70

to 80. Key board activities, outcomes of

discussion and decisions are described

on pages 65 and 74 .

— The Environmental & Social

Sustainability (ESS) Committee

oversees the development and

execution of the group’s health

inclusivity and sustainability strategy,

including targets and KPIs related to

climate and nature which track our

performance. The details of the key

responsibilities, committee activities

and focus areas in 2025 are set out

on page 74 and the membership and

meetings are described on page 64

In 2023, 2024 and 2025, the ESS

Committee conducted deep dive

sessions covering the evaluation

of our environmental and social

sustainability strategy, TCFD, climate

transition plans and the impacts of

nature and biodiversity loss.

— The Audit & Risk Committee oversees

our principal risks, including the

principal risk related to ESG, which

covers climate change and nature

(see page 70).

— The Remuneration Committee

supports our climate strategy by

aligning the Performance Share Plan

with ESG performance via the ESG

qualifier. Executive remuneration is

tied to specific health inclusivity and

sustainability-related KPIs. For the

year ended 2025, this included

climate-related objectives (see page

78 to 80).

— The Chief Executive Officer and the

Executive Team are responsible for the

delivery of our health inclusivity and

sustainability strategy, and they are

supported by various governance

forums, including for the management

of climate and nature-related risks and

opportunities.

— The Environment Steering Committee

governs progress against Haleon’s

environment strategy and

commitments, including climate

change and nature commitments. The

Committee meets at least quarterly

and makes strategic recommendations

on managing our environmental

footprint for approval by the Executive

Team and the Board. It also monitors

climate-related risks, opportunities

and regulations. It is chaired by the

Vice President of Sustainability, and

Executive Team members include the

Chief Corporate Affairs Officer the

Chief Supply Chain Officer and the

Chief R&D Officer. Information on

strategy, performance and risks flows

to the Executive Team and then the

Board committees via participation

of the Chief Corporate Affairs Officer,

the Sustainability VP and the ESG

Programme and Reporting Director.

— The Executive Team Risk Forum (Risk

Forum) oversees management of

principal risks, helping ensure they

are managed effectively. This includes

the ESG principal risk (see page 55).

Number of meetings and key roles are

detailed on page 52. In May 2025, the

Risk Forum reviewed the ESG principal

risk, which is owned by the Chief

Corporate Affairs Officer and

monitored via our risk management

framework (see page 50).

— Compliance and Risk Forums (CRF) are

conducted by our functional teams,

categories, and business units, to

embed risk management in day-to-day

business operations. Details about the

Sustainability CRF can be found in the

risk management section (see

page 20).

— Working groups in our global

functions, global categories and

business units integrate health

inclusivity and sustainability targets,

principles and initiatives (including

those related to climate change and

nature) into Haleon’s strategy and

planning process, capital planning and

budgeting, day-to-day responsibilities

and metric management.

Climate and nature-related

financial disclosures

Discover

more…

Climate Action

Transition Plan

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Strategy and risk

management

The process for identifying, assessing

and managing climate and nature-related

risks is consistent with Haleon’s four-step

enterprise risk management process as

outlined on page 50. This helps ensure

that accountability for the identification,

assessment, mitigation and monitoring

of risks is aligned with our strategic

objectives.

Our approach to managing climate and

nature risks is outlined in the Governance

section.

The Sustainability CRF leads the

environmental (including climate and

nature), social risk identification

and assessment process, which is

conducted on an ongoing basis. Risks

are assessed and prioritised by taking

into consideration the likely impact

(considering both financial and

reputation impacts), the probability of

the risk and the controls that are in place

to manage the risk, in line with Haleon’s

risk management framework outlined on

page 50. This helps to identify those risks

and controls where management should

focus its effort. The Sustainability CRF

met six times in 2025 and includes the

Vice President of Sustainability and

members of the Sustainability team.

Continuous evaluation and management

of risk is embedded in our strategy to

enable an appropriate, measured and

timely response. Risk owners are

assigned to the risks (including climate,

nature and social risks) and continually

monitor and assess each risk.

A combination of internal knowledge

and external factors, such as horizon

scanning, legal and regulatory

developments, and emerging

environmental and nature science, are

considered to determine whether to

mitigate, transfer or accept the risks.

In some cases, it may be deemed

appropriate to transfer the risk, for

example by discharging costs or liability

to another party in our value chain. Part

of the risk assessment process is also

acceptance: establishing a level of

comfort with the risk, considering our

existing control strategies, and assessing

whether they are currently sufficient.

The most significant climate and

nature-related risks and opportunities

are described in detail in this section

along with our plans to manage them.

These are considered to have the most

significant impact on our business,

strategy and financial planning. However,

we do not anticipate the need for further

significant changes to our strategy to

respond to these risks, and action plans

are in place to manage them. Risk and

mitigation plans undergo a formal review

at least once a year.

Both the TCFD and TNFD exercises

informed our Double Materiality

Assessment, which was conducted

taking into account the requirements

of the EU Corporate Sustainability

Reporting Directive (CSRD) and European

Sustainability Reporting Standards (ESRS)

(enacted prior to 2025) in preparation for

potential future reporting by the Group

and/or by our companies (see pages 5

and 6 of our Health Inclusivity and

Sustainability Report for more

information). For further details read

our Climate Action Transition Plan.

Metrics and targets

We include climate and nature-related

metrics and targets as part of our overall

health inclusivity and sustainability

strategy. See page 15 for more details

on our targets and performance, and

our 2025 Health Inclusivity and

Sustainability Report, page 4 for further

information. Data for years prior to 2024

are available on our ESG Reporting Hub.

We continue our journey to better

manage climate risks, and in 2024

implemented a new internal metric to

monitor the percentage of sales

generated by our own sites at high risk

of extreme weather events, which we

continue to monitor. Our Scope 1, 2 and 3

emissions are set out in line with the UK

Government’s guidance on Streamlined

Energy and Carbon Reporting (SECR)

(see pages 177 and 178) and built into our

ESG qualifier as described on page 96.

Climate impacts, risks and

opportunities

Our resilience to climate change

As outlined in the risks on pages 22 to

26, the quantitative scenario analysis

indicates that our business is not at high

risk of facing significant financial impacts

from climate-related risks in the short

term. Any climate-related risks with a

medium-risk financial impact are either

projected to occur in the long term or are

being addressed through our mitigating

actions. As a result, we do not anticipate

the need for major, further changes to

our strategy to respond to these risks.

In the medium and long term, we need

to consider transition risks. The transition

to a low-carbon economy could have

financial implications for Haleon, as

consumer preferences shift towards

sustainable products, potentially

impacting our market share and brand

reputation. Additionally, increased

carbon taxes on emissions across our

operations and supply chain could also

have financial impacts. However, these

risks can be mitigated if we achieve our

carbon reduction targets for emissions

across all scopes. We have already

conducted life-cycle assessments for

11 key product types to better

understand and mitigate the risks

associated with their life-cycle stages.

You can read more in our Climate Action

Transition Plan.

In the long term, we need to be aware

of the impacts of physical risks. Our key

facilities could be affected by flooding

and heatwaves, leading to disruption

and damage. Our Oral Health product

line could also be impacted by

disruptions in the supply of agricultural

raw materials, which are at a higher risk

of yield impact due to long-term climate

change. While we already have a resilient

sourcing strategy for these key crops,

which includes working with mint farmers

in India to improve the sustainability

of production, we need to continue

monitoring the situation.

As climate change continues, there is an

opportunity from increased demand for

consumer health products as a result of

the increasing frequency, severity and

prevalence of several everyday health

conditions which we provide solutions

for. Examples include the allergy season

becoming longer and more intense,

higher prevalence of vector-borne

diseases such as malaria with a related

need to treat fever symptoms and more

prevalent and severe headache, migraine

and joint pain driven by extreme weather.

The transition to a low-carbon economy

also presents an opportunity for us, as

consumer preferences shift towards

more sustainable products. To capitalise

on this opportunity, we need to continue

to improve the sustainability of our

products and make consumers aware of

these changes through effective claims

and consumer messaging.

Climate and nature-related financial disclosures

continued

Haleon

Annual Report and Form 20-F 2025

Warming trajectory by 2100

Climate scenarios

Rationale behind climate scenario analysis selection

1.5°C

Paris Ambition:

Rapid transition to a

low-carbon economy with orderly

emissions reductions and rapid

consumer preference change.

Enables us to test our business strategy against the most optimistic scenario from a climate-transition perspective.

Aligns with our target to be a net zero business from source to sale by 2040, aligned to guidance from The Climate

Pledge and Race to Zero.

Aligns with TCFD and IPCC

recommendations to include a 2°C or lower scenario, with a 1.5°C scenario recommended

as the ‘2°C or lower', aligning with the latest scientific research from the IPCC.

This scenario represents the ‘worst case' / highest potential for transition risk for our business.

>4°C

No Policy:

Reversal of emissions

reductions and abolishment of climate

policy leading to extreme warming.

Enables us to test business strategy against the worst-case scenario from a physical risk perspective.

This scenario was used in our qualitative analysis in 2022.

We used the IPCC Representative Concentration Pathways (RCPs) to assess physical climate risk. RCPs are commonly used by climate scientists to assess physical climate risk, with each pathway representing a different GHG

concentration trajectory which can then be translated into global warming impacts. We used climate data from the World Climate Research Programmes Coupled Model Intercomparison Project – Phase 6 (CMIP 6 – adjusted for

spatial resolution and bias corrected) to do this translation. RCPs feed into climate, crop and flood models. There are four RCP pathways with RCP8.5 representing the worst case scenario.

Climate-related scenario analysis

Climate-related scenario analysis is

used to assess the potential impact of

climate-related risks and opportunities.

In 2022, we performed our first

qualitative analysis which we refreshed

in 2023, both qualitatively and

quantitatively, to assess the risks and

opportunities in greater detail and

understand the impact of climate change

on our existing business model. The

insights derived from this analysis remain

robust and relevant. The results have

been used to inform our strategy and

financial planning, including updates

to our underlying cash flows for our

planned actions to meet our climate

ambitions. We will update our scenario

analysis in 2026.

We worked with a climate risk analytics

company, Risilience, to quantify the

potential financial impact of our physical

and transition climate risks and

opportunities. Risilience used a “Digital

Twin”, which is a data-driven digital

representation of our business and value

chain. This used internal data from our

business including current and approved

financial projections, market breakdown,

key facilities, raw materials and our GHG

footprint, to stress-test and quantify the

potential financial impact of climate risks

and opportunities under different

scenarios.

The climate scenarios used as part of

the analysis are outlined below. We also

modelled a 2.5ºC-warming trajectory but

we are not disclosing it here as we are

only disclosing the results with the

highest potential impact.

A number of assumptions were made in

carrying out the analysis:

— Current mitigating actions were not

modelled for any of the scenarios.

— All scenarios were modelled

independently, i.e. no correlation was

assumed between different risks and

opportunities.

— Investment costs required to realise

opportunities were not considered.

While many scenario models and

techniques are advanced, we recognise

that knowledge in this area is growing,

and we expect models and pathways

to evolve with time. Models also have

limitations, and there are certain areas

which are challenging to model.

Additionally, in certain situations,

different models can project contrasting

results. In these situations, we have

considered how different outcomes

would impact our businesses.

Impact of climate-related risks

and opportunities, and resilience

of our strategy

In 2023, we updated the time horizons

used to consider the impact of climate

risks and opportunities. The length

of the time horizons was reduced to

allow greater alignment to modelling

capabilities for quantitative scenario

analysis, and to reduce the risk of

modelling uncertainties associated

with using time horizons beyond 2050.

This provides more accurate results

compared to using longer time horizons

and aligns with our business risk cycles,

allowing us to use the analysis for

strategic decision-making.

We define short, medium and long-term

horizons for climate-related risk

purposes as follows:

—

Short-term (0-4 years):

aligns to

our financial planning and risk

management framework.

—

Medium-term (5-9 years):

aligns to

our interim Scopes 1, 2 and 3 emissions

reduction targets for 2030.

—

Long-term (10+ years):

aligns to our

net zero target for 2040 and the UK

Government's net zero target for 2050.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Physical climate-related risks

Climate risk

Impact analysis

Management of risk

Impact of extreme weather events

on operations and supply chain

The revenue and cost impact of damage

and disruption to key facilities from the

following climate hazards: riverine, coastal

and flash flooding, heatwaves, water

stress, and temperate and tropical

windstorms.

Potential impacts included in our Paris Ambition (1.5°C) and No Policy (4°C)

scenario analysis included:

—

Revenue disruption from the interruption of supply of electricity, gas and water,

due to heatwaves and flooding.

—

Inefficiencies in production due to disrupted employee travel, e.g. caused by

flooding.

—

Increased facility and operational down time, due to damaged transport

infrastructure.

—

Direct damage to stock, buildings, and contents from flood and windstorms.

Under a No Policy (4°C) scenario, the hazards with the greatest potential to impact our

business are fluvial and flash flooding, and heatwaves, over the long-term time horizon.

Three of our sites, Guayama (Puerto Rico), Tianjin (China) and Dungarvan (Ireland), are

at greatest risk of property damage from fluvial flooding owing to their close proximity

to rivers.

Sites in the US, southern Europe and eastern China are located in regions that could

experience a rapid increase in heatwave probability driven by global average

temperatures and the likelihood of prolonged extreme temperature events. Heatwaves

have the potential to cause disruption through interrupting our supply chain (such as

from infrastructure damage to the road and rail network) as well as reducing the

productivity of our workforce through human health impacts.

The risk of water stress is considered to be low with 0.4% of annual revenue from our

owned sites being potentially impacted in the long-term (by 2050).

Assumptions:

—

2023 financial values are kept constant up to 2050 and acute physical risk shocks

were applied to these values.

—

The revenue share for our sites was assumed to be site revenue as a proportion

of total revenue. The remaining revenue share was split proportionally across

third-party manufacturers' sites.

—

Meteorological conditions that could lead to water stress (i.e. severe drought) were

considered. Local geological conditions were excluded from the analysis.

Actions:

—

In 2024 we conducted refresher training for regional environment, health and

safety (EHS) and engineering leads on climate risks.

—

Manufacturing sites are included within a loss-prevention survey programme and

are routinely visited to confirm appropriate resilience measures are in place,

including flood, wind and storm protection.

—

Our manufacturing sites have emergency plans, disaster recovery plans (DRPs),

and business continuity plans (BCPs), which we continuously test against to

further enable improvements at our sites to withstand extreme weather events.

—

Our BCPs include options for multiple sourcing for manufacturing of our products.

This is achieved by using a combination of Haleon or third-party manufacturing

organisations' sites, spread across different geographies.

—

We conducted value-chain water footprint analysis to better understand potential

water-related risks in specific geographies and prioritise actions.

—

All our manufacturing sites are implementing the AWS standard to address local

water-related risks and opportunities. As of 2025, all of our sites have been AWS

core certified. We are committed to putting in place programmes to meet our

water neutral goal. In 2023 our Cape Town site became water neutral following

water replenishment activities in 2022 with WWF South Africa. In 2026 we are

aiming for our site in Nairobi, Kenya, to start investing in projects to become water

neutral by the end of 2029. Currently 8 of our manufacturing sites are in scope of

the goal as they are located in areas of current or future water stress.

Metrics and targets:

—

All our manufacturing sites in water-stressed basins

to be water neutral by 2030.

—

AWS certifications at all our manufacturing sites by end of 2025.

Paris Ambition (1.5°C)

No Policy (4°C)

Climate and nature-related financial disclosures

continued

Determined using publicly available tools to identify water risk, such as the WRI Aqueduct Tool, site-specific reviews of local water risk using local data, and materiality of the risk to the business.

Key

Short-term 0–4 years

Medium-term 5–9 years

Long-term 10+ years

Financial impact of risk or opportunity

Low risk £10m–£40m

Medium risk £40m–£80m

High risk >£80m

Opportunity

Haleon

Annual Report and Form 20-F 2025

Physical climate-related risks

Climate risk

Impact analysis

Management of risk

Reduced availability of raw materials

due to chronic weather impact

The financial impacts on ingredient

production due to chronic climate change

induced by changing temperature and

precipitation patterns. The following raw

materials were considered for the

analysis: corn, wheat, mint, palm oil and

soybean.

Potential impacts included in our Paris Ambition (1.5°C) and No Policy (4°C)

scenario analysis included:

—

Reduction in crop yields leading to supply and demand implications and price

volatility.

—

Supply shortages which could prevent or limit the production of key product lines

and lead to a loss in revenue.

—

Increased costs due to long-term chronic drought affecting crop supply and

implementation of adaptation measures such as irrigation solutions.

Scenario analysis was conducted to assess the financial impact of crop yield

fluctuations caused by long-term climate change for our key crops. Changes in rainfall

and temperature were assessed using data on crop sourcing locations and crop

vulnerability. The effects of sudden hazards like heatwaves and droughts on crops were

also assessed, considering the sourcing locations with a high likelihood or increasing

probability of such events.

Changes in long-term precipitation and temperature patterns under the No Policy (4°C)

scenario are likely to affect wheat and corn sourcing, with wheat experiencing the

largest average percentage yield decline of c.37% between 2023 and 2050. Our key

sourcing regions for these crops (France, US and UK) could also be impacted by

extreme weather events, such as drought or severe heatwave events, further reducing

crop yields.

In our Oral Health products, corn is a crucial feedstock. However, the projected impact

on corn yields in 2050 is anticipated to be minimal, accounting for less than 3% of the

total revenue generated by Oral Health products in 2023.

Under the No Policy (4°C) scenario, certain areas of central US may see corn yields

decline as a result of precipitation variation.

Assumptions:

—

2023 financial values are kept constant up to 2050 and acute physical risk shocks are

applied to these values.

—

The impact of climate conditions on raw material supply is limited to temperature

and precipitation. Other conditions, such as soil quality, were excluded from the

analysis.

—

Revenue impacts were considered in terms of reduced crop yields leading to

production limitations. Price fluctuations were not considered in the analysis.

Actions:

—

We are assessing the feasibility of substituting raw materials with lower-risk

alternatives, for example replacing corn-derived ingredients with alternatives to

reduce exposure to yield and cost fluctuations.

—

We have a robust sustainable sourcing strategy in place. See our Health Inclusivity

and Sustainability Report on page 19.

—

Our sourcing strategy involves multiple sourcing options from different

geographies and holding materials safety stocks where feasible. Continuity of

supply is a priority for our procurement team.

—

Haleon has launched its Sustainability Guidance for Suppliers Document, outlining

clear expectations and standards for our suppliers across key workstreams

including carbon reduction. The document offers targeted guidance and practical

support to help suppliers navigate the complexities of sustainability and advance

meaningful progress throughout our shared value chain.

—

Sustainability requirements are embedded into tender processes.

Metrics and targets:

—

All of our key agricultural, forest, and marine-derived materials to be sustainably

sourced and deforestation-free by 2030

Paris Ambition (1.5°C)

No Policy (4°C)

Scope includes Haleon's globally managed spend on key materials that are agricultural, forest, or marine-derived. Globally managed spend covers the majority of our internal spend and expands across some of our third-party manufacturing network.

Key

Short-term 0–4 years

Medium-term 5–9 years

Long-term 10+ years

Financial impact of risk or opportunity

Low risk £10m–£40m

Medium risk £40m–£80m

High risk >£80m

Opportunity

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Climate-related transition risks

Climate risk

Impact analysis

Management of risk

Policy: carbon pricing

The financial impacts of carbon taxes on

emissions across our operations and

supply chain.

Potential impacts included in our Paris Ambition (1.5°C) scenario analysis

included the following (the ‘No Policy’ (4°C) scenario was not relevant):

—

Direct increase to overhead costs from Scope 1 and 2 emissions (e.g. cost of

electricity and fuel).

—

Increased cost of raw materials from upstream suppliers passing through increased

costs from Scope 3 emissions.

—

Reduction in sales from passing the costs from carbon taxes on to consumers.

—

Under a Paris Ambition (1.5°C) scenario global carbon prices are expected to grow

in the medium term. Failure to achieve our SBTi-aligned target for Scope 1 and 2

emissions can lead to a medium risk. However, if we meet our SBTi target, the risk is

significantly reduced as we aim to achieve at least 95% absolute Scope 1 and 2

emissions reduction by 2030 (vs a 2020 baseline).

—

Indirect Scope 3 emissions account for the majority of our exposure to carbon costs,

particularly upstream emissions associated with farming and processing, which could

be passed on by our suppliers. We have limited ability to influence these costs as

they will depend on the extent to which suppliers reflect carbon tax expenditure

within prices. The risk of indirect Scope 3 costs will be greatly reduced if we are able

to meet our commitment to reduce Scope 3 emissions from source to sale by 42% by

2030 (vs a 2022 baseline) and deliver our net zero source-to-sale target by 2040,

aligned to guidance from ‘Race to Zero’ and ‘Amazon Climate Pledge’.

Assumptions:

—

Business as usual emissions trajectory where emissions grow proportionally to

revenue growth.

—

Linear trajectories were used between scenario data points to estimate climate

pricing data for intervening years.

—

All global emissions are subject to carbon pricing and no border adjustments were

included in the analysis.

—

No risk is assumed under a No Policy (4°C) scenario. This is due to this scenario

representing a reversal of current policies including currently implemented carbon

prices.

—

Carbon price used in the analysis (2027 weighted average carbon price): $83.45/

tonne. Carbon prices used in analysis were collated from sources such as the IMF,

IEA and NGFS.

Actions:

—

Delivery of our carbon emissions reduction targets for Scopes 1, 2 and 3 carbon

emissions as outlined below and in our Climate Action Transition Plan will mitigate

our operations’ exposure to future carbon pricing and environmental taxation.

—

We work with our suppliers through industry groups such as Energize to help

suppliers transition to renewable electricity and take actions to reduce their

carbon footprint.

—

In 2024, we ran a Supplier Climate Training Programme with over 380 participants

from our top suppliers. The aim was to educate and support them on their

decarbonisation journey. In 2025 we held our first Supplier Sustainability Forum

which covers topics including carbon reduction.

—

In 2024, Haleon implemented a carbon pricing scheme that converts carbon

emissions into a commercial value for supplier selection criteria. This mechanism

encourages suppliers to reduce their carbon footprint to make themselves more

competitive. Haleon's carbon price follows the EU ETS cost of carbon.

—

We have launched our Haleon Sustainability Guidance for Suppliers Document

which provides support and actionable steps for our suppliers to implement.

These include things like, baselining their emissions, transitioning to renewable

electricity and low carbon heat generation.

Metrics and targets:

—

Reduce net Scope 1 and 2 carbon emissions by 100% by 2030, vs a 2020 baseline.

—

Reduce Scope 3 carbon emissions from source to sale by 42% by 2030, vs a 2022

baseline

—

Achieve net zero carbon emissions from source to sale by 2040, aligned with

guidance from the Climate Pledge and Race to Zero

Paris Ambition (1.5°C)

No Policy (4°C)

Not applicable

Our net zero and Scope 3 carbon emissions targets span carbon emission categories from source to sale (excluding GHG protocol categories 6, 7 and 10-15).

Climate and nature-related financial disclosures

continued

Key

Short-term 0–4 years

Medium-term 5–9 years

Long-term 10+ years

Financial impact of risk or opportunity

Low risk £10m–£40m

Medium risk £40m–£80m

High risk >£80m

Opportunity

Haleon

Annual Report and Form 20-F 2025

Scope includes Haleon’s globally managed spend on key materials that are agricultural, forest, or marine-derived. Globally managed spend covers the majority of our internal spend and expands across some of our third-party manufacturing network.

Climate risk

Impact analysis

Management of risk

Changing consumer preferences

The financial impacts of taking action

towards the sustainability of our products,

and consumer purchasing shifting towards

more sustainable brands (e.g. products

with less plastic or more recyclable

packaging).

Potential impacts in our Paris Ambition (1.5°C) and No Policy (4°C) scenario

analysis included:

—

Reduction in product sales and loss of market share.

—

Reputational damage and a reduction in brand loyalty.

—

Under a Paris Ambition (1.5°C) scenario, it is expected that consumers will rapidly

shift towards more sustainable products. The majority of potential revenue loss is

driven by our Oral Health products, which represent the largest share of total

revenue.

Assumptions:

—

Buying preferences will vary at differing rates across global regions.

—

To model demand shifts of our products, consumer-led demand for sustainable

packaging was used as a proxy.

—

The risk was modelled under a scenario where we do not act to improve the

sustainability of our products, in order to analyse the unmitigated impact of

consumer demand shifts.

Actions:

—

To meet or exceed the expectations of our key stakeholders, including consumers,

we are committed to deliver on our health inclusivity and sustainability strategy

and targets (page 15).

—

We conducted an extensive study to explore and understand the importance of

social and environmental issues to people around the world, to understand their

sustainability priorities in relation to our Oral Health, OTC and VMS categories.

We conducted quantitative research in 11 markets in 2022 (Australia, Brazil, China,

Germany, Indonesia, Italy, Poland, South Africa, Thailand, UK and the US) and

qualitative research in 4 markets in 2023 (China, Germany, UK and the US) that

included online consumer communities, digital listening (US), cultural analysis and

expert interviews. This work has given us a broad and deep understanding of

consumers’ concerns and needs, enabling us to identify a roadmap for Haleon to

follow, to help address these, in both the short and longer term.

—

Using our annual sustainability claims tracker, we monitor the incidence of

environmental and social sustainability promotional claims across new product

launches in our categories.

—

Our sustainability impact assessment tool (SIAT) enables our R&D teams to

calculate, analyse and compare the impact of product and packaging design

decisions on key environmental-impact parameters (including carbon footprint

and packaging). We have improved the scoring process to make it more

quantitative and introduced a weighted sustainability scoring. Every large project

is required to achieve significant improvements on packaging or carbon compared

to the baseline. In 2025, we introduced a feature that accounts for packaging

headspace, helping us optimise the full capacity of our primary packaging.

—

We are participating in programmes such as Amazon’s ‘Climate Pledge Friendly’

programme as well as making direct consumer-facing sustainability promotional

claims in relation to our products or listings in retailers’ sustainable choices

ranges.

—

With a focus on health inclusivity, our brands seek to tackle specific barriers that

stand in the way of better everyday health. This includes empowering consumers

and Health Professionals to better understand the impact of climate change on

health and equipping both with tools and solutions to manage and mitigate the

impact on everyday health.

Metrics and targets:

—

Develop solutions for all product packaging to be recycle-ready by 2025 and

recyclable or reusable by 2030, where safety, quality and regulations permit.

—

Reduce our use of virgin petroleum-based plastic by 10% by 2025, and a third by

2030, vs a 2022 baseline.

—

All of our key agricultural, forest, and marine-derived materials to be sustainably

sourced and deforestation-free by 2030

Paris Ambition (1.5°C)

No Policy (4°C)

Climate-related transition risks

Key

Short-term 0–4 years

Medium-term 5–9 years

Long-term 10+ years

Financial impact of risk or opportunity

Low risk £10m–£40m

Medium risk £40m–£80m

High risk >£80m

Opportunity

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Climate-related transition opportunities

Climate opportunities

Impact analysis

Management of opportunity

Changing consumer preferences

The financial impacts of taking action

towards the sustainability of our products,

and consumer purchasing shifting towards

more sustainable brands (e.g. products

with less plastic or more recyclable

packaging).

Potential impacts in our Paris Ambition (1.5°C) and No Policy (4°C) scenario

analysis included:

—

Changing consumer demand to low-carbon alternatives, leading to a gain in market

share and an increase in product sales.

—

Positive reputational impacts and increasing brand loyalty.

—

The potential market opportunity for more sustainable products could be significant

under a Paris Ambition (1.5°C) scenario, equating to 2.6% additional revenue in 2032,

compared to baseline projected revenues. Consistent with the related risk, the

greatest potential for upside is driven by our Oral Health products.

—

The size of the potential opportunity decreases in the long term, as more products

align with consumer preferences and take actions to meet future climate targets.

Therefore, the opportunity reduces for product groups which have already seen a

sustainable shift.

Assumptions:

—

Buying preferences will vary at differing rates across global regions. To model

demand shifts for Haleon's products, consumer-led demand for sustainable

packaging was used as a proxy.

—

The opportunity was modelled under a future where we work to improve the

sustainability of our products in order to understand the potential financial gains

that could be realised.

Actions:

—

Management as for equivalent risk on page 25.

Metrics and targets:

—

Develop solutions for all product packaging to be recycle-ready by 2025, and

recyclable or reusable by 2030, where safety, quality and regulations permit.

—

Reduce our use of virgin petroleum-based plastic by 10% by 2025, and a third by

2030, vs a 2022 baseline.

—

All of our key agricultural, forest, and marine-derived materials to be sustainably

sourced and deforestation-free by 2030

Paris Ambition (1.5°C)

No Policy (4°C)

Climate and nature-related financial disclosures

continued

Key

Short-term 0–4 years

Medium-term 5–9 years

Long-term 10+ years

Financial impact of risk or opportunity

Low risk £10m–£40m

Medium risk £40m–£80m

High risk >£80m

Opportunity

Scope includes Haleon’s globally managed spend on key materials that are agricultural, forest or marine-derived. Globally managed spend covers the majority of our internal spend and expands across some of our third-party manufacturing network.

Haleon

Annual Report and Form 20-F 2025

Nature dependencies,

impacts, risks and

opportunities

Our process for identifying, assessing

and prioritising nature-related

dependencies, impacts, risks and

opportunities (DIROs) followed the

TNFD LEAP methodology and included

the use of a variety of recommended

tools.

Our analysis confirms and reinforces

actions we are already taking. Given this,

we will continue to drive delivery against

our relevant, externally committed goals.

These include sustainable sourcing,

water stewardship and engaging

suppliers in taking actions across their

value chains to address risks, ensuring

preparedness for regulatory changes,

and increasing supply chain resilience.

Our LEAP Assessment reviewed 393 sites

across our value chain:

— 29 Haleon sites.

— 69 third-party manufacturing sites.

— 282 Tier 1

supplier sites.

— 13 Tier 2

supplier sites.

We identified priority locations to focus

on by combining an analysis of ecological

thresholds and tipping points, identifying

material and sensitive locations.

As well as taking a site-specific

approach, our LEAP assessment also

examined our value chains through local,

sub-national, national and global lenses,

to provide a comprehensive analysis of

nature-related risks and opportunities.

Policy changes and regulatory

requirements

Our assessment also considered evolving

policy and regulatory requirements,

which are key drivers of risk and require

ongoing monitoring and adaptation, e.g

the EU Deforestation Regulation (EUDR).

The potential nature-related DIROs we

have currently identified as part of our

LEAP assessment are presented on

pages 28 to 30. These DIROs informed

our Double Materiality Assessment

(DMA) for identification of topics. Our

DMA was conducted taking account of

the requirements of the EU Corporate

Sustainability Reporting Directive (CSRD)

and the European Sustainability

Reporting Standards (enacted prior to

2025) in preparation for potential future

reporting by the Group and/or by our

companies (refer to pages 5 and 6 of our

2025 Health Inclusivity and Sustainability

Report for more information).

Our DIROs

Our LEAP assessment highlighted key

dependencies on natural resources and

ecosystem services – such as water,

biodiversity, and healthy soils – across

our value chain. These dependencies

underpin our ability to source key

materials used in our products – such as

mint, palm oil, corn and wheat derivatives

– and to operate manufacturing sites.

Key dependencies identified include

a dependency on water in our own

operations and upstream value chain,

where we need water to manufacture

our products, and a dependency

on fertile soils to grow our key raw

materials, including mint. The analysis

identified potential impacts – including

biodiversity loss, water quality

degradation, and ecosystem disruption

– which could result from activities like

deforestation, fertiliser use and water

pollution from active pharmaceutical

ingredients. These impacts translate into

a range of risks: physical (e.g. water

scarcity, supply chain disruption),

transition (e.g. evolving regulations,

market shifts), and reputational (e.g.

stakeholder expectations, brand trust).

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Tier 1: suppliers of

goods, materials,

or services directly

to Haleon, which

includes third-party

manufacturers.

Supplier companies

within the same group

are counted as a

single supplier.

Tier 2: suppliers that

provide materials,

components or

services to our tier 1

suppliers.

Nature risks

Impact analysis

Management of risk

Water pollution from

pharmaceutical releases in the

environment after consumer

end-use.

—

Degradation of water quality and ecosystem health could result in increased

pharmaceutical residues in water, leading to increased regulatory action.

—

Stricter regulations on the disposal, treatment and management of active

pharmaceutical ingredients (APIs) could result in regulations to control the sale

of such products, with a potential loss of revenue and/or increased operational

costs, associated with new disposal and treatment methods, infrastructures

or technologies.

Actions:

—

We encourage the right consumer behaviour through the ‘Let’s treat it right’

campaign, engaging consumers to use, dose, store and dispose of everyday

medicine responsibly.

—

We innovate to mitigate risks through new product development, including those

which reduce product wash-off, e.g. transdermal patches.

—

We advocate in support of well-designed wastewater extended producer

responsibility (EPR) schemes, to enhance wastewater treatment.

Water pollution in Haleon's

upstream value chain activities.

—

Upstream raw material production processing and raw material sourcing could

result in water pollution (e.g. discharges of insufficiently treated wastewater,

agricultural run-off, etc).

—

New regulations in these countries to minimise water pollution impacts could

increase costs for suppliers or lead to production delays.

Actions:

—

We have revised and updated our standards, scope and process for managing

wastewater for third parties, e.g. suppliers and third-party manufacturers who

handle APIs and certain other personal care product ingredients.

—

We continue to audit relevant suppliers and third-party manufacturers to

Pharmaceutical Supply Chain Initiative (PSCI) Standards on a risk-based frequency.

We supplement this with ad hoc desk-based assessments to determine if

wastewater is managed to our standards.

Sourcing of water intensive

commodities from regions with

high water stress.

—

The sourcing of water-intensive commodities (such as mint, corn, soy, etc) by our

suppliers for use in the ingredients we purchase has the potential to exacerbate

local water scarcity and increase operational and supply chain vulnerability in

commodity production landscapes. This can lead to reduced yields, production

delays and potential increased costs related to obtaining pure, quality water and the

potential need to shift to new feedstocks or sources of materials, away from areas of

heightened scarcity.

Actions:

—

We are supporting farmers in our upstream supply chain to adopt improved

agricultural practices. This includes supporting mint farmers to adopt improved

water stewardship by using drip irrigation, to switch to natural pesticides and

fertilisers and to manage water run off through our supplier-led ‘Healthy Mint

Supply Chain’ programme.

Metrics and targets:

—

All key agricultural, forest and marine-derived materials to be sustainably sourced

and deforestation-free by 2030

Scope includes Haleon’s globally managed spend on key materials which are agricultural, forestry or marine-derived. Globally managed spend covers the majority of our internal spend and expands across some of our third-party manufacturing network.

Climate and nature-related financial disclosures

continued

Key

Short-term 0–1 years

Medium-term 1–3 years

Long-term 3+ years

Haleon

Annual Report and Form 20-F 2025

Nature risks

Impact analysis

Management of risk

Contribution to climate change as a

driver of biodiversity loss from

GHG emissions across the value

chain.

—

GHG emissions from suppliers, manufacturing, logistics and products contribute

to climate change, which, in turn, is a driver of biodiversity loss through rising

temperatures, altered rainfall patterns, more frequent extreme weather events,

and the spread of pests and disease. Supplies of timber-derived paper and

other naturally derived raw materials are potentially at risk from these impacts.

—

Supplier investments to substitute or protect disrupted ecosystem services (natural

benefits that support farming, such as pollination of crops, natural pest control,

soil fertility maintenance, and water regulation) and/or adoption of certification

systems that seek to address this could lead to increased costs.

Actions:

—

We are taking action to reduce our Scope 1, Scope 2 and Scope 3 GHG emissions

across our value chains (page 17).

—

Our work with mint farmers through our ‘Healthy Mint Supply Chain’ programme

and with smallholder palm oil farmers through the support of the ‘Kaleka’ project

in Central Kalimantan, Indonesia, aim to address biodiversity loss caused by

climate change and other factors, and protect and restore the provision of

ecosystem services. Our commitment to RSPO

and FSC

certification for palm oil

and paper help reduce climate and biodiversity impacts. RSPO prohibits

deforestation and protects peatlands, while the FSC standard promotes

climate-smart forestry and increased carbon storage.

Metrics and targets:

—

To reduce our net Scope 1 and 2 carbon emissions by 100% by 2030, vs a 2020

baseline.

—

To reduce our Scope 3 carbon emissions, from source to sale, by 42% by 2030, vs a

2022 baseline.

—

For all key agricultural, forest and marine-derived materials to be sustainably

sourced and deforestation-free by 2030

Biodiversity loss due to land-use

change from upstream sourcing.

—

Land-use change such as deforestation, habitat conversion and agricultural

expansion in upstream supply chains, driven by supplier-operated sites, represents

a significant risk to biodiversity in our value chains. This affects the ecosystem

services that are essential for raw material production and wider supply chain

stability. This is particularly prevalent in palm oil, soy and paper sourcing landscapes.

—

Increased regulations, trade restrictions or barriers on products linked to

deforestation in certain jurisdictions can increase cost pressures on our supply chains.

Actions:

—

We require FSC/PEFC

certification for paper, RSPO mass balance certification of

palm-derivatives and are working with partners to map these supply chains to

better understand risks. As a member of Action for Sustainable Derivatives (ASD),

we have increased the traceability of palm oil used by our suppliers to 93%

traceable up to refineries, 92.4% traceable up to mills, 85% traceable up to

plantations in 2024. Utilising the Nusantara Atlas satellite monitoring tool, ASD

can assess deforestation and conversion of forest close to palm oil production

areas relevant to our supply chains.

—

We are supporting the Mosaik Initiative, a collaborative initiative that aims to

sustainably restore palm oil growing landscapes and drive economic growth in

Central Kalimantan, Indonesia as part of our membership of Action on

Sustainable Derivatives (ASD).

—

We continue to engage suppliers to improve traceability, promote sustainable

practices and maintain compliance with our sourcing standards.

Metrics and Targets:

—

All key agricultural, forest and marine-derived materials to be sustainably sourced

and deforestation-free by 2030

RSPO: Roundtable on Sustainabile Palm Oil.

FSC: Forest Stewardship Council.

Scope includes Haleon’s globally managed spend on key materials which are agricultural, forestry or marine-derived. Globally managed spend covers the majority of our

internal spend and expands across some of our third-party manufacturing network.

PEFC:

Programme for the Endorsement of Forest Certification.

Key

Short-term 0–1 years

Medium-term 1–3 years

Long-term 3+ years

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Nature risks

Impact analysis

Management of risk

Downstream consumer waste

associated with Haleon packaging

after use.

—

The need to develop and manufacture sustainable packaging can increase costs,

but also satisfy consumer demand for sustainable products.

Actions:

We manage our impact proactively through our work to make our products and

packaging more sustainable. For example:

—

In 2025 our Advil brand in the US reduced the amount of plastic in its bottles by

over 100 tonnes, using sustainable plastic technology which enables reduced

bottle wall-thickness while maintaining barrier properties.

—

Our Flonase brand switched outer packaging made from non-recyclable plastic to

a paper-recyclable design, eliminating over 169 tonnes of single-use plastic waste

in 2024. This initiative won Flonase both a prestigious WorldStar Global Packaging

Award and the 2024 AmeriStar Award for Sustainable Packaging.

Metrics and targets:

—

Develop solutions for all product packaging to be recycle-ready by 2025 and

recyclable or reusable by 2030, where safety, quality and regulations permit.

—

Reduce our use of virgin petroleum-based plastic by 10% by 2025, and a third by

2030, vs a 2022 baseline.

Tighter regulations on production

activities that risk having harmful

effects on water.

—

Increasingly stringent regulations may result in increased costs for advanced water

treatments, or restrictions in production.

—

Costs of increased supplier engagement and audits against new standards, to

mitigate these regulatory risks and maintain supply chain resilience.

Actions:

—

We engage with suppliers and hold them to a high standard of water and pollution

management, through desk-based assessments and site audits to check

wastewater discharges remain in safe limits.

—

We implemented the Alliance for Water Stewardship (AWS) Standard across

our manufacturing network and, as of 2025, all of our sites have been AWS

core certified.

—

We engage with local stakeholders, identifying opportunities and developing

water stewardship plans to address shared water challenges, including action on

water pollution.

—

We have a long standing and robust programme in place to manage the

wastewater generated by our manufacturing sites. We regularly assess the risk of

pollution, and take action where needed – for example, we may improve a process

on site to reduce the levels of a pollutant in the wastewater, or upgrade our on-site

wastewater treatment to remove it.

Metrics and targets:

—

Achieve AWS Standard certification at all our manufacturing sites by 2025.

—

Achieve water neutrality at our manufacturing sites in water-stressed basins

by 2030.

Nature-related opportunities –

We face a complex landscape of regulatory, operational and supply chain risks, but have also identified opportunities to create value. These include leveraging our

actions to make our products more sustainable – to support consumer-facing promotional claims and qualify our products for high-growth, retailer sustainable-choices ranges.

Climate and nature-related financial disclosures

continued

Key

Short-term 0–1 years

Medium-term 1–3 years

Long-term 3+ years

Haleon

Annual Report and Form 20-F 2025

Section 172 statement and stakeholder engagement

Section 172

statement

In accordance with the requirements of

Section 172 of the Companies Act 2006

(the Act), the Directors consider that

during the financial year ended 31

December 2025, they have acted in a

way that they consider, in good faith,

would most likely promote the success

of the Company for the benefit of its

members as a whole, having regard to

the likely consequences of any decision

in the long term and the broader

interests of other stakeholders,

as required by the Act.

Constructive engagement with

stakeholders remains central to how

Haleon delivers on its purpose and

strategy. As a global consumer health

company, the Board is mindful that our

actions have broad social, environmental

and economic reach, and that our

stakeholders’ perspectives are vital

to long-term success.

In 2025, our engagement approach

evolved combining leadership-driven

initiatives with active board participation

to ensure the voices of consumers,

colleagues, investors, partners and

communities inform our thinking. This

ongoing dialogue enables the Board and

management to identify emerging issues

early, respond to them effectively, and

shape decisions that balance short-term

performance with sustainable growth.

By embedding meaningful stakeholder

engagement into both operational and

strategic decision making, Haleon

strengthens transparency, trust and

accountability across the organisation.

This inclusive approach underpins our

governance framework and supports our

ambition to be a responsible, responsive,

and innovative leader. More information

on how the Board had regard to each

matter, during the year, is available in

the following pages:

S172 Factor

Relevant disclosures

The likely consequences of any decision in the

long term

Strategy

Our business model

KPIs

Governance

Board activities

Health inclusivity and sustainability

Page 6

Page 4

Page 40

Page 60

Page 65

Page 15

The interests of the Company’s employees

Our culture and people

Stakeholder engagement

KPIs

Directors’ Remuneration Report

Workforce engagement

Page 35

Page 31

Page 40

Page 78

Page 69

The need to foster business relationships with

suppliers, customers and others

Stakeholder engagement

Our culture and people

Board activities

Page 31

Page 35

Page 65

The impact of the Company’s operations on the

community and the environment

Health inclusivity and sustainability

Environmental & Social Sustainability

Committee Report

Page 15

Page 74

The desirability of the Company maintaining a

reputation for high standards of business conduct

Our culture and people

Audit & Risk Committee Report

Directors’ Report

Page 35

Page 70

Page 175

The need to act fairly as between members of

the Company

Our culture and people

Stakeholder engagement

Workforce engagement

Board activities

Page 35

Page 31

Page 69

Page 65

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Mutually beneficial relationships with our stakeholders:

Strong stakeholder relationships are

key to our long-term success

Engagement with stakeholders provides valuable insights that inform our

decisions. It helps build a performance-focused culture and work efficiently

to create relevant, effective offerings aligned with the needs of consumers

and health professionals across diverse global markets.

Consumers

The end users of our

products

Trusted brands that

understand their needs

Safe, innovative,

sustainable, health-

enhancing products

A purpose-led, inclusive

company that offers

career development and

support

Long-term stakeholder

value, effective

corporate governance,

responsible business

practices

Trust-based

relationships;

responsible practices,

values and policies

Driving demand for our

products and the

ultimate source of our

revenues

Commercial partners

and essential channels

to our consumers

Deliver our products and

operate our business

effectively

A stable legal and

regulatory environment

that supports investment

and innovation

Support performance

through

recommendations; help

us understand long-term

trends

Access to funding for

investment through

equity and debt

Supply chain and

business continuity;

support with our

environmental ambitions

Customers

pharmacies, drugstores,

retailers and ecommerce

platforms

Employees

Governments

and industry

regulators

Health

professionals

Investors

Suppliers

Accessible, safe and

effective products that

help reduce the burden

of healthcare costs

Effective, safe science-

based products;

responsible sales and

marketing practices

Section 172 statement and stakeholder engagement

continued

Haleon

Annual Report and Form 20-F 2025

Examples of how we engage

Examples of outcomes

Examples of measurement

Consumers

—

Brand and advertising campaigns using health and

wellness influencers.

—

Sponsorship of major cultural and sporting events.

—

Self-care and community outreach programmes.

—

Consumer industry events and exhibitions.

—

Consumer enquiries handled by our Global Consumers

Relations Team.

—

Advil’s ‘That’s Real Strength’ campaign (US) educated consumers on how strength is

about acknowledging pain and treatment.

—

Voltaren as official licensed pain relief gel for UEFA Champions League in Germany.

—

Conducted self-care tests for c. 9,000 consumers at major exhibition in China.

—

Customer satisfaction score (CSAT) with Consumer Relations Service improved by

seven points in 2025.

—

Enhanced consumer insights process to better inform innovation pipeline.

—

Brand equity scores.

—

Increased brand and category performance.

—

Number of consumers engaging with Haleon and its

brands via self-care tests.

—

Volume of consumer interactions, with 1.3 million

interactions in 2025.

—

Consumer satisfaction scores.

Customers

—

Partnership programmes with major retailers focused on

self-care.

—

Sector and customer collaboration supporting local

communities.

—

Regular workshops to share best practices and exchange

insights and strategies.

—

Interactive visits to our shopper research centres.

—

Activated UK retailer programmes for Voltarol and Centrum on menopause support.

—

Delivered health education by working with leading global retailer in China through

dedicated in-store health zones.

—

Provided leading online retailer with VMS category insights to enhance AI-driven

product matching to address consumer needs.

—

Launched new shopper research centre in Brazil to drive deeper engagement with

strategic customers.

—

Growth in share of shelf and distribution points.

—

Customer net sales performance and retention.

—

Direct feedback from customers via industry surveys

e.g. Advantage Group Survey.

—

Volume of customers visiting our shopper research

centres.

Employees

—

Annual employee engagement survey.

—

Global broadcasts and Executive Team market visits.

—

Development programmes and resources.

—

Line manager calls with the Executive Team.

—

Employee resource groups (ERGs).

—

Employee engagement sessions with the Executive Team

and Board.

—

Employee engagement score of 82%.

—

Four global broadcasts where employees engage with the Executive Team.

—

40,000 places were taken up during our second ‘Growing at Haleon’ learning week.

—

Held 10 line manager calls and eight employee engagement sessions.

—

Held four global flagship ERG events.

—

Employee engagement survey results.

—

Number of employees joining global broadcasts.

—

Level of engagement on internal channels and platforms.

—

Level of participation during our ‘Growing at Haleon’ week.

—

Level of participation in ERG events.

—

Sentiment and engagement at employee listening sessions.

Governments and industry regulators

—

Participation in global/regional health and trade policy

events.

—

Key Government stakeholder and MLO visits and meetings.

—

Leadership roles in industry trade associations e.g. GSCF,

AESGP.

—

Regular input into policy, regulatory and legislative reform.

—

Speaker panels at international health and trade events (World Health Assembly,

Politico Healthcare Summit).

—

Ministerial visit to Weybridge UK R&D facility and site for new Global Oral Health

Innovation Centre.

—

Supported Global Self-Care Coalition’s new manifesto at UN General Assembly.

—

Participated in the B20 South Africa Industrial Transformation and Innovation

Taskforce.

—

Successfully advocated for the inclusion of oral health in the UN Political Declaration

on Noncommunicable Diseases (NCDs).

—

Number and quality of Government engagements.

—

Product speed to market.

—

Costs associated with regulatory changes.

—

Positive progress in policy, legislative and regulatory

developments.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Examples of how we engage

Examples of outcomes

Examples of measurement

Health Professionals

—

Global launch of Haleon Pain Management Institute

(HPMI).

—

Participation in large-scale health professional industry

events.

—

Campaigns and activations to promote global health

days.

—

Haleon Health Partner Portal.

—

Engaged c.40,000 health professionals globally on HPMI through in-person and

online events.

—

Developed brain health wellness programme for International Pharmaceutical

Federation (FIP), reaching 150 global FIP leaders from 90 markets.

—

World Oral Health Day activation in India achieved Guinness World Record for

greatest dental screenings conducted in 24 hours.

—

Over 128,000 hours of webinar content consumed by healthcare professionals.

—

Industry awards e.g. Centre for Human Sciences

recognised by PMEA Awards.

—

Key Performance Indicators (KPIs) for events.

—

Increase in number of expert brand recommendations.

—

Volume of webinar attendees.

—

Number of Haleon Health Partner Portal registrations

(reached c.1.1 million in 2025).

Investors

—

Roadshows, ‘fireside’ chats, webcasts, conferences and

1:1 meetings.

—

Investor events covering areas of interest.

—

AGM, stock exchange announcements and results

briefings.

—

Held Haleon’s first Capital Markets Day as a standalone business, engaging c.100

investors and analysts.

—

Regular updates to the Board and Executive Team on investor, shareholder and

analyst perceptions.

—

Review of strategy incorporating investor feedback.

—

Number and quality of interactions.

—

Investor and analyst surveys.

—

Feedback from investors and analysts.

—

Level of analyst and investor participation in events.

Suppliers

—

Supplier innovation events.

—

Supplier training programmes.

—

Online supplier portal.

—

Sustainable supply chain programme.

—

CPO communications with strategic suppliers.

—

Held 65 supplier innovation events resulting in new innovation projects.

—

Sustainability training and resources delivered to c.50 suppliers.

—

Simpler, more automated ways of working.

—

Accelerated carbon reduction incentive programme for suppliers.

—

Updates on Haleon strategy for suppliers.

—

Number of suppliers attending our events.

—

Number of suppliers attending our training.

—

Feedback from suppliers.

—

Number of tenders using carbon pricing.

—

Continuity of relationships.

Section 172 statement and stakeholder engagement

continued

Haleon

Annual Report and Form 20-F 2025

Our culture and people

Purpose-led,

performance‑focused

As we transform into a world class consumer company, we are reshaping

Haleon’s culture to support our Win as One strategy. We are building a

distinctive culture that gives us a competitive edge and enables us to

deliver at pace. Underpinned by our purpose – to deliver better everyday

health with humanity – we are driving an agile and performance‑focused

culture, empowering our people to innovate, collaborate and reach their

full potential, so we can meet the evolving needs of our consumers

across the world.

89%

Annual engagement

survey overall

response rate

77%

Win as One index

Our Win as One strategy

Our Win as One strategy sets the

direction for Haleon to seize

opportunities and realise our full

potential. It provides clarity for the

whole business to drive the organisation

consistently forward. There are four

elements to our strategy – all designed to

work together and reinforce each other.

It starts with our purpose – to deliver

better everyday health with humanity –

because what we do matters. To achieve

this, we have defined two ambitions: to

reach one billion more consumers by

2030 and deliver industry-leading

shareholder returns. Four strategic

drivers underpin these ambitions,

supported by behaviours that foster

an agile, performance-focused culture.

These include reports from our Speak Up

channel and the results from our annual

employee engagement survey. As part of

our cultural development work we have

evolved our employee listening approach

to sharpen how we measure cultural

progress, celebrate successes, and allow

for course correction. Our approach now

encompasses a wider range of indicators

to include data points that show

improvements in employee perception

and business outcomes related to our

five culture transformation levers

(strategy, operating model, processes,

people and behaviours and performance

management). These insights show a

fuller experience of working at Haleon,

related to the targeted cultural shifts

we are making and enable action taking

through the course of the year.

Our full range of indicators now include:

— Clear behavioural expectations set

through annual mandatory Code of

Conduct training including anti-bribery

and corruption and keeping data

secure.

— A new cultural transformation

dashboard to measure progress

against the five transformation levers

through perception and business

outcomes.

— A framework of internal financial and

operational controls, audit and

assurance programmes that monitor

the Company’s compliance with

regulations and internal procedures

and policies.

— Encouraging anyone, whether working

for Haleon or not, to speak up about

misconduct, breaches of policy or

procedures, and suspected violations

of laws and regulations.

— Measuring employee engagement

through our annual employee

engagement survey. Haleon received

an 82% overall engagement score.

In line with our purpose, our refreshed

Health Inclusivity and Sustainability

strategy is woven into every element

of our strategy. Together, they align

our organisation to accelerate growth.

This is how we Win as One – through our

people, creating impact for consumers

and value for shareholders.

Measuring our culture

Culture is the foundation of how we

deliver on our purpose and Win as One

strategy and we are continuing to

transform Haleon into a world-class

consumer company with an agile,

performance-focused culture. The Board

and Executive Team receive regular

reports on all aspects of culture, through

quarterly engagement sessions led by

our board member and Workforce

Engagement Director, Dame Vivienne Cox.

Growing at Haleon

Week

A week of development and

learning for our global community

Growing at Haleon Week 2025 returned

after its successful launch in 2024,

bringing together our global community

for a focused week of learning and

development. Held in September, the

programme offered a rich agenda of

sessions, workshops, and engagement

activities aimed at strengthening

enterprise thinking and accelerating

cultural transformation. Highlights

included a keynote from Brian

McNamara on breaking down silos

and moving ‘slow to go fast’ to drive

purposeful progress. Additional

sessions led by Haleon leaders

explored how better understanding

consumers – particularly in lower

income segments – can unlock new

opportunities for growth.

Net promoter

score 70 (NPS)

I would recommend Growing at

Haleon Week.

Spotlight

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our culture and people

continued

— Measuring our environmental, health

and safety performance across the

Company and conducting risk-based

audits, which the Board and Executive

Team monitor.

— Conducting regular conversations and

year-end reviews with employees.

Our people

Our people comprise permanent

and fixed-term direct employees,

supported by third-party temporary

workers and contractors. We are

creating an organisation where

everyone can reach their full potential

and perform at their best. Our Win as

One culture gives us a competitive

edge and attracts industry-leading

talent. Together our people focus on

our growth and productivity ambitions.

To support this, our initiatives and

policies reflect international employment

law, including the Universal Declaration

of Human Rights, and International

Labour Organisation (ILO) Declaration

on Fundamental Principles and Rights at

Work. We work to create an inclusive

environment where everyone can belong.

increase in internal hiring volumes driven

by job posting policies and improved

talent marketing.

Development and learning has three

objectives: build the right competencies

to stay safe and compliant within our

regulatory environment; develop

strategic capabilities; and provide

employees with opportunities to grow

and reach their potential. We identify

strategic capability needs through our

strategic planning processes overlaid

with our talent and performance cycles.

External trend analysis enables us to

prioritise hard to find capabilities that

are critical to our enterprise strategic

plans. These inform our internal learning

and development offerings and

investments in capability-building

programmes. Our offerings include a

range of options, from apprenticeships

(where available), coaching and

mentoring to self-led resources,

supporting employees’ career

development at Haleon. September saw

us launch our new learning management

system, the first phase of modernising

our total learning ecosystem. This puts

relevant learning in the hands of

employees with greater ease, and is

accessible on any device, anywhere;

outpacing the norm for manufacturing

environments. We have streamlined

related learning processes and items.

In June, we ran our second leader event

in London, building on momentum from

the previous year. We ran our second

Growing at Haleon Week, available to all

employees globally. More than 40,000

places were taken up across 19 sessions,

with 35 speakers.

Leadership development

Our leadership development offer

provides a globally consistent, career-

stage appropriate, and strategically

aligned curriculum for leaders at all

Attracting, fostering and

developing talent

Our ability to attract and retain industry-

leading talent is critical to delivering

our Win As One ambitions. Our talent

acquisition capability evolved again

in 2025; we simplified our recruiting

processes, aligned our interview guides

and interview enablement to the Win As

One strategy. We also deployed new

leadership assessments to improve how

we identify the most impactful talent for

critical roles – internally and externally.

We improved both the reliability of and

accessibility to, key talent insights and

hiring performance data. In Q1, we

implemented Eightfold AI, a leading

candidate relationship management and

recruiting workflow automation tool,

which has measurably reduced cost and

time-to-offer for both executive and

non-executive recruitment. As a result,

we have seen significant improvements

in our hiring speed, hiring experience

delivered to candidates and managers,

a reduction in external vendor spend,

and automation of key work processes

such as interview scheduling and

candidate outreach. In 2026, we plan

to improve how we onboard new hires

to drive speed to productivity and new

hire retention. We also anticipate an

levels of the organisation. Since 2023,

58% of the leadership population have

completed at least one global leadership

development programme, a significant

increase from 12% in 2022. This

demonstrates strong engagement in our

global leadership development offer.

NPS across these programmes average

60, and completion rates are at 78%+

reflecting strong participant advocacy

and satisfaction with the global

offerings. We have also won silver and

bronze Brandon Hall Awards for our two

leadership development programmes –

Inspire and Lead.

Creating a more inclusive workplace

In 2025, we continued to develop our

commitment to inclusion and belonging

(I&B) and our strategy focused on three

key pillars:

— Employee belonging – creating a

work environment that is inclusive

and accessible.

— Workforce representation – attract,

recruit, promote and retain the best

talent that reflects the communities

and consumers that we serve.

— Societal change – leverage our

expertise to enable health inclusivity

through our business relationships,

brands and research.

In 2025, Haleon’s Global I&B council met

quarterly to set priorities, review I&B

progress, and drive accountability for our

inclusion agenda. The council, sponsored

by the Chief Human Resources Officer

and chaired by the Global Head of

Talent, provides oversight and funding

for global initiatives, ensuring that I&B

is embedded consistently across

the business.

Discover

more…

We will undertake

targeted cultural

development work

in 2026 to help to

ensure Haleon

continues to have a

culture that

supports our

strategic plans.

See also our

business model,

stakeholder

engagement,

strategy, approach

to risk and financial

statement

sections

on pages 4, 32, 6, 50

and 105.

See also our

key

performance

indicators

section

on page 40.

See also the

Audit &

Risk Committee

Report

from

page 70.

See also our

statement of

compliance

page 59 with links

to our standards

and policies.

Our ability to attract and retain industry‑leading

talent is critical to delivering our Win As One

ambitions. Our talent acquisition capability

evolved again in 2025; we simpliﬁed our recruiting

processes, aligned our interview guides and

interview enablement to the Win As One strategy.

Haleon

Annual Report and Form 20-F 2025

Our employee resource groups (ERGs)

are open to all employees and create

inclusive, supportive communities where

colleagues can connect through shared

experiences and act as strategic partners

to the business by advancing inclusive

practices. In 2025, our ERGs delivered

meaningful impact across the business:

Pride helped secure the Rainbow

Honours Large Organisation of the

Year award; our inclusive mentoring

programme Elevate U! doubled its reach

and Women@Haleon launched our first

Menopause toolkit; Empower advanced

accessibility and neurodiversity with

resources such as a managers’ toolkit

and a Celebrating Different Minds video

series; and Illuminate strengthened

ethnic inclusion through unified local

networks and targeted programmes.

We also continue to champion local

ERGs (for example, our UK Carers ERG

and the introduction of our new

generational ERG: ConnectGen).

Collectively, these efforts strengthened

Haleon’s culture of inclusion, reaching

colleagues across 20 markets and

multiple functional chapters.

Outside the US and Puerto Rico, we

remain committed to achieving our

gender parity goal 48-52%

in our global

leadership roles by 2030

. We aim to

framework by creating a wellbeing

steering committee with representatives

from different areas of the business.

In 2026, we will continue to collaborate

closely with the Benefits team to ensure

alignment between our wellbeing and

benefits strategy. We are also planning

to create an employee oral health

programme and refresh our preventative

health offering.

Workplace environments

We have continued to evolve our

Workplace Solutions guidelines and

standards in 2025. As we continue to

adapt and grow, our foremost objective

is to ensure that each of our offices

and sites delivers an optimal level

of service and experience that meets

the evolving needs of our business

and employees. This year, we have

introduced innovative design guidelines

that emphasise enhancing the employee

experience at our sites. Our revised

guidelines and standards establish a

cohesive global approach, ensuring

consistency, safety, sustainability,

achieve this by ensuring our hiring, talent

pipeline and development processes

remove bias and encourage applications

from a range of talent – ensuring that

appointments are always made based

on the skills and experience required

for the role.

Employee health and wellbeing

At Haleon we are committed to ensuring

wellbeing is at the heart of the everyday

employee experience, enabling our

employees to be at their best and thrive.

Aligned to our Win as One ambitions,

and by prioritising wellbeing, celebrating

differences, and fostering an inclusive

workplace, we aim to unleash the full

potential of our employees.

In 2025, we launched our new 24/7

confidential global employee assistance

programme (EAP) in partnership with

our wellbeing partner to support our

employees and their dependants

across both personal and professional

challenges. We refreshed and

relaunched our wellbeing champion

network, growing the network globally

and developing a new framework to

set up our champions for success and

embed wellbeing into our culture.

As part of our new wellbeing strategy,

we have started to build a governance

and cost control across all locations

while simultaneously supporting our

workforce and our brand. We are

committed to creating spaces that strike

the perfect balance between

productivity, community, collaboration

and focus areas. Where possible, our

Hybrid at Haleon philosophy enables

employees to blend working from the

office, home and other locations to

foster creativity and innovation, enhance

focus and deepen relationships. Current

working arrangements can include

part-time working, home working and

flexible working hours.

As at 31 December 2025

Men

Women

Other

Non-

disclosed

Total

Directors

—

Executive Team

—

Executive Team direct reports

—

105

Senior managers

711

650

—

1,372

All employees

13,036

11,348

139

24,535

Gender representation reporting is provided in accordance with our UK reporting obligations.

Comprised of Leadership roles as defined in our glossary.

Company gender representation

See also our

Nominations &

Governance

Committee Report

on page 76.

Aligned to our Win as One ambitions, and by

prioritising wellbeing, celebrating differences,

and fostering an inclusive workplace, we aim

to unleash the full potential of our employees.

Gender parity is

defined as between

48-52%. Since 2025,

this metric does not

include the US

and Puerto Rico.

Percentage indicates

the percentage of

female permanent

employees.

Employees who did

not self-identify their

gender or answered

‘prefer not to say’ are

excluded from the

calculation.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Health and safety

In 2025, we continued our commitment

to achieving a safe, healthy workplace

and a zero-harm culture. Our EHS

management system and strategic

approach continue to prioritise building

capability, high hazard risk elimination

and simplifying processes to prevent

harm in the workplace. This strategy is

underpinned by annual objectives and

measurable targets designed to drive

continuous improvement and reduce

reportable injuries, illnesses, and

serious incidents.

We also maintained our focus on

delivering task-specific and risk-based

health and safety training for employees

and third-party temporary workers,

emphasising hazard recognition and

proactive risk mitigation in the workplace.

2025

2024

Reportable Injury

and Illness Rate per

100,000 hours worked –

employees and

external workers

0.14*

0.13

Lost time injury

and illness rate per

100,000 hours

worked – employees

and external workers

0.13*

0.11

Fatalities

KPMG LLP has issued independent limited

assurance, using assurance standard ISAE (UK)

3000, over the selected data indicated.

In 2024, one additional lost-time reportable

event was reported late following an internal

investigation and therefore was not included in

the 2024 Reports.

The purpose of the Haleon safety board,

as part of the governance framework

that manages Haleon’s Product User

Safety risk, is to: set the Company’s

product safety strategy; and oversee the

implementation of the product safety

policy in relation to the composition and

core company position of all products.

Additionally, continuous monitoring

of ingredient safety is conducted in

collaboration with industry peers,

regulators and healthcare providers,

ensuring that Haleon remains proactive

in assessing the safety and benefits of

its products.

Upholding our standards

We have standards and policies in place

to ensure we uphold high standards of

business ethics. We are committed to

transparency, integrity, consumer

satisfaction, safety and compliance

with all relevant laws and regulations.

Product quality, safety and

development

Our products undergo extensive quality

testing and controls as part of our

manufacturing processes. In addition,

we have portals for consumers to obtain

product information and report adverse

reactions. The Haleon Quality System

establishes standards that govern

the entire product lifecycle, ensuring

consistency across all business units and

third-party manufacturers. It emphasises

the role of management at all levels in

upholding these standards, particularly

during product development. Haleon’s

scientists focus on tailoring products to

meet local needs, subjecting them to

rigorous research and testing to comply

with quality and safety standards,

thereby fostering consumer trust.

This process includes various

assessments such as stability testing,

consumer feedback and clinical studies.

Integral to this system is the Trusted

Ingredients programme, which leverages

cross-functional expertise to guide the

selection of active pharmaceutical

ingredients and excipients or additives

used in our products. Haleon implements

controls to evaluate potential benefits,

risks and consumer concerns associated

with these ingredients, including an

independent evidence-based safety

review for new ingredients added to the

product portfolio.

Cyber security

We recognise that the cyber security landscape within

which we operate is hostile and like many other

organisations we are at risk of a cyber-security attack

that could compromise our ability to manufacture,

distribute and sell our products and services. We

continue to invest to mitigate this risk, including using

advanced technologies, engagement of third-party

experts, and the development of our own capability.

We have a third-party risk management process in

place to help ensure that inherent risk assessments are

completed for third-party suppliers, with additional due

diligence assessments completed for higher risk

suppliers.

We have a dedicated cyber-security function that is

focused on the threat landscape and attack vectors

that are targeting healthcare providers, including

ransomware threats, and a cyber-defence team in place

to monitor and react to cyber threats. The security team

build appropriate controls into new developments

whilst continually assessing the posture of production

systems. Haleon’s Chief Information Security Officer

has approximately 15-years cyber-security experience

and is responsible for the cyber-security function. They

provide frequent updates on issues including: current

threats; operational key risk indicators; and cyber-

security maturity improvements, to the Executive Team

and Audit & Risk Committee, who have oversight of our

information security and cyber-risk strategy. Cyber

security risk updates are shared with the wider Board

by the Audit & Risk Committee.

—

During the year we ran several independent cyber

exercises to test our organisational response to

threats. These have provided valuable insights to

allow us to further improve our defences.

—

There was strong focus on the Operational

Technology (OT) environments within our

manufacturing and R&D sites.

—

As part of our overall drive to improve our cyber

security posture, 2025 saw the initiation of our cyber

culture campaign. Launched by the CEO in January,

it has been a year-long campaign aimed at improving

the cyber security awareness of our people covering

several key topics such as password discipline,

physical security, and the risks of social engineering

through an omni-channel approach.

—

Given the hostile external landscape, we have

reviewed our cyber preparedness during the year

and identified tactical enhancements. In addition,

we have put in place actions to further improvements

across the organisation to strengthen our resilience.

—

During 2025, Haleon did not identify any significant

cyber security related incidents.

Spotlight

Our culture and people

continued

We are committed to transparency,

integrity, consumer satisfaction, safety

and compliance with all relevant laws

and regulations.

Haleon

Annual Report and Form 20-F 2025

— As part of our commitment to

continuous improvement, we

introduced the Sustainability

Guidance for Suppliers Document,

outlining expectations in key areas –

decarbonisation, human rights, water

stewardship, and sustainable sourcing

– and providing practical steps to

make progress towards our

sustainability goals.

— We aim to achieve net zero carbon

emissions from source to sale by

2040

. We have implemented key

policies to support this goal,

including our Buying Goods and

Services Policy, which covers not only

the requirements for carbon pricing

in tenders but also the sustainable

procurement of agricultural, marine

and forest derived materials.

— We are driving our Scope 3 agenda to

achieve our SBTi near-term goal of

reducing source to sale emissions by

42% vs 2022. This includes partnering

with suppliers, promoting renewable

electricity adoption through

our sponsorship of the Energize

programme, supporting cost-efficient

transitions to low-carbon heat via our

partnership with Johnson Controls,

and optimising transition plans

with Zeroute.

confidentiality; proportionality; and

non-retaliation. Regular updates and

investigation reports are reviewed by

senior management and the Audit & Risk

Committee, and learnings are converted

into recommendations and updated

training.

Human rights

Haleon is committed to respecting

and promoting human rights wherever

we do business, including upholding

the Universal Declaration of Human

Rights and the International Labour

Organization’s core labour standards.

We aim to align our processes and

procedures with international standards,

including the UN Guiding Principles on

Business and Human Rights and the

Organisation for Economic Co-operation

and Development’s (OECD) Guidelines

for Multinational Enterprises. Our Human

Rights Policy is reviewed by the

Environmental & Social Sustainability

Committee (ESS) and outlines how we

embed human rights principles into

business practices and relationships

with suppliers and partners.

Our suppliers

Haleon’s supply chain is essential to

supporting both our commercial

objectives and sustainability ambitions.

We work with a broad network of

suppliers providing goods for

manufacturing, as well as value-added

services such as technology, marketing,

and logistics.

— Our approach is guided by Haleon’s

Supplier Code of Conduct, which sets

minimum expectations for ethical

conduct, environmental stewardship,

and social responsibility. Each Haleon

supplier is expected to accept and

follow it.

Haleon’s supply chain is essential to

supporting both our commercial objectives

and sustainability ambitions.

Discover

more…

For further

information about

our zero carbon

initiatives see our

approach to health

inclusivity and

sustainability

section on page 15

and our Health

Inclusivity and

Sustainability

report.

Code of Conduct

Our Code of Conduct helps to promote

ethical business practices and offers

guidance to our Board, Executive Team,

employees and third-party temporary

workers. Non-compliance with our Code is

considered misconduct and may lead to

disciplinary action, including termination.

Relevant principles of our Code also

extend to our suppliers, distributors,

agents, consultants and contractors.

The Code: comprises 19 principles; is

available in 19 languages; and combines

written standards with a decision-tree

approach to help make the right choices

and know when to seek advice. In 2025,

a new section on leadership

expectations was included in our Code

to clearly communicate expected

behaviours to line managers. All

employees receive annual training on the

Code of Conduct and essential

compliance principles.

Anti-bribery and anti-corruption

Our policy on the Prevention of Bribery,

Corruption and Other Financial Crimes

outlines our global principles, standards,

requirements, and zero-tolerance stance.

All employees and third-party temporary

workers must adhere to this policy and

receive training on its main principles.

Regular internal checks are conducted as

part of our financial control procedures,

and due diligence checks are performed

on all high-risk third parties. During 2025,

regular updates on the compliance

programme were provided to the

Executive Team and the Audit & Risk

Committee.

Speak up

Haleon encourages anyone, whether

working for the Company or not, to

speak up about misconduct, breaches

of policy or procedures, and suspected

violations of laws and regulations.

Concerns can be raised in multiple

languages via an independently

managed web form and hotlines, or by

email, telephone, or post. All cases are

handled in accordance with Haleon’s

investigatory principles: humanity;

Aligned to guidance

from The Climate

Pledge and Race to

Zero.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our key

performance

indicators

We have several enterprise metrics monitoring

performance across the business, from which

we select our key performance indicators (KPIs).

These are the most applicable in tracking our

strategic performance, health inclusivity and

sustainability efforts, and commitments to our key

stakeholders. The Board and Executive Team

monitor our KPIs to ensure continued alignment

to our strategy and, where applicable, they are

linked to Executive Directors’ remuneration.

See also the

Directors’ Remuneration Report

from page 78, and

forward-looking

statements

on page 204

Delivery on our 4–6% medium-term guidance.

Relevance and calculation:

Measures the strength of

our existing portfolio. Data is reconciled to our Financial

Statements. Reconciliations are included in our Non-IFRS

measures section on page 205.

Future focus:

Continue to deliver on our guidance,

prioritising driving growth from increasing penetration,

brand building, innovation and developing routes

to market.

Targeting medium-term leverage of c.2.5x net debt/

adjusted EBITDA.

Relevance and calculation:

Reducing our leverage

strengthens our balance sheet and maintains our

investment-grade credit rating. Data is reconciled to our

Financial Statements. Reconciliations are included in our

Non-IFRS measures section on page 205.

Future focus:

Operate a strong investment-grade

balance sheet with medium-term leverage of c.2.5x net

debt/adjusted EBITDA.

A key component in measuring the viability of our

business.

Relevance and calculation:

Provides us with capacity

to invest in the business, pay down debt and make

shareholder returns. Data is reconciled to our Financial

Statements. Reconciliations are included in our Non-IFRS

measures section on page 205.

Future focus:

Drive free cash flow through a

combination of working capital management and

efficiencies across the business.

A key profitability measure, measuring the Group’s

performance against its sustainable growth model.

Relevance and calculation:

Drives value-creating

behaviours and captures excess cash returned to

shareholders via share buybacks, which in turn increase

total shareholder returns. Data is reconciled to our

Financial Statements. Reconciliations are included in

our Non-IFRS measures section on page 205.

Future focus:

Top-line and bottom-line growth of the

business, reduction of interest charges through optimal

leverage, and share buybacks.

Continued profitable growth.

Relevance and calculation:

Our organic operating profit

growth is an important indicator of the strength of our

business model. Data is reconciled to our Financial

Statements. Reconciliations are included in our Non-IFRS

measures section on page 205.

Future focus:

Drive positive operating leverage, whilst

at the same time ensuring healthy investment to drive

top-line growth or return to shareholders.

Drive market share gains through brand building,

innovation and increased investment in A&P and R&D.

Relevance and calculation:

The attractiveness of

our products is key for all our stakeholders, giving

them confidence in our ability to increase household

penetration and capitalise on new and emerging

opportunities. Based on Haleon’s analysis of third-party

market value sales and share data, including IQVIA,

Circana and NIQ data.

Future focus:

Ensure healthy investment in A&P and

drive innovation through investment in R&D.

Free cash flow

PSP

Adjusted diluted earnings per

share (EPS) growth

PSP

Business gained/maintained share

Financial and commercial KPIs

Organic revenue growth

AIP

Net debt/adjusted EBITDA

PSP

Organic operating profit growth

AIP

2023

2024

2025

3.0%

5.0%

8.0%

2023

2024

2025

£1.9bn

£1.6bn

2023

2024

2025

2.6x

2.8x

3.0x

2023

2024

2025

5.0%

3.5%

(6.0)%

2023

2024

2025

10.5%

9.8%

10.8%

2023

2024

2025

60%

71%

58%

Haleon

Annual Report and Form 20-F 2025

Our KPIs and Executive Director

remuneration in 2025

Elements of our Executive Director remuneration are

linked to the delivery of specific KPIs, that are

considered the most relevant in assessing business

performance and our commitments to stakeholders.

See also the

Directors’ Remuneration Report

from page 78.

Performance Share Plan ESG qualifier

The 2025 Performance Share Plan has an ESG qualifier

with thresholds set for two responsible business KPIs:

carbon reduction and a reduction in virgin petroleum-

based packaging. At the end of the performance period,

if either of the thresholds are missed, a reduction in

the level of vesting of 10% could be applied for each

missed threshold. If the metrics are static or go

backwards compared to the 2024 baseline, a 25%

reduction in the level of vesting could be applied for

each measure (i.e. a potential overall reduction of up

to 50%).

Reduce our net Scope 1 and 2 carbon emissions by 100%

by 2030 vs a 2020 baseline.

Relevance and calculation:

Decarbonising our

operations is a key focus area and helps protect against

climate-related transition risks. We track the percentage

change in total tonnes of market-based net Scope 1

and 2 greenhouse gas (GHG) emissions vs 2020.

Future focus:

We are focused on addressing our

remaining Scope 1 emissions by transitioning to

renewable-energy-powered systems for heating

and cooling.

We aim to achieve gender parity in leadership roles

by 2030.

Relevance and calculation:

We believe that building an

inclusive organisation, that represents the consumers

and communities who rely on our brands, is a

competitive advantage and is an important consideration

for our stakeholders. Calculated as a percentage of

employees who self-identify as female, compared to

our overall number of permanent employees, across a

quarterly average.

Future focus:

Monitor representation (excluding the US

and Puerto Rico) to understand the composition of our

workforce and how it reflects our key stakeholders.

Reduce our use of virgin petroleum-based plastic by

10% by 2025, and a third by 2030, vs a 2022 baseline.

Relevance and calculation:

Packaging and plastic

pollution are environmental areas of high concern to

consumers. We are committed to addressing this by

making our packaging more sustainable. We track the

percentage change in estimated tonnes of virgin

petroleum-based plastic in our packaging vs 2022.

Future focus:

Continue to focus on reducing our use

of virgin petroleum-based plastic, and replacing it with

recycled plastic or alternative materials, focusing on

our most significant packaging formats.

Build a company where employees are proud to work,

feel inspired, challenged, supported and have a sense

of personal accomplishment.

Relevance and calculation:

Ensuring employees feel

that Haleon is fulfilling its core engagement index

measures, is fundamental to our long-term success.

We track responses to our core engagement index

measures in our annual employee survey and review

progress via our pulse survey.

Future focus:

Continue to focus on strengthening our

culture to drive performance, agility and continuous

improvement.

Gender representation

PSP ESG QUALIFIER

Employee engagement

Responsible business, people and culture KPIs

Performance Share Plan 2025-27

PSP

Annual Incentive Plan

AIP

Carbon reduction

PSP ESG QUALIFIER

Virgin petroleum-based plastic

reduction

PSP ESG QUALIFIER

50% linked to Cumulative

free cash flow

30% linked to Adjusted

diluted EPS growth

20% linked to Organic

operating margin improvement

40% linked to Organic

revenue growth

40% linked to Organic

operating profit growth

20% linked to individual

business objectives

Footnotes:

KPMG LLP has issued independent limited assurance

over the selected data indicated, using assurance

standards ISAE(UK)3000 and ISAE 3410.

Organic revenue growth, Organic operating profit

growth, Free cash flow, Adjusted diluted earnings per

share and Net debt/adjusted EBITDA are Non-IFRS

measures. Definitions and calculations of Non-IFRS

measures can be found on page 205.

Performance Share Plan measure until and including

the 2023-2025 PSP.

Successful reductions shown as negative figures.

The 2024 and 2025 reporting periods run from

1 December of the prior year to 30 November of the

reported year. The 2020 baseline is the calendar year.

Carbon offsets account for 11% of our location-based

Scope 1 and 2 carbon emissions in 2025.

Successful reductions shown as negative figures. The

2024 and 2025 reporting periods run from 1 July of

the prior year to 30 June of the reported year. The

end point for the 2025 goal is the end of the 2025

calendar year. The 2022 baseline is the calendar year.

The scope of our estimated packaging footprint

includes product packaging and some devices,

including toothbrushes.

Gender parity is defined as between 48-52%. Since

2025, the Gender representation metric does not

include the US and Puerto Rico. The 2024 result has

also been updated to exclude these, hence the 2024

result shown differs from the value of 45.2%

disclosed in the 2024 Annual Report and Form 20-F

and the 2024 Responsible Business Report.

Percentage indicates the percentage of female

permanent employees.

Performance Share Plan ESG qualifier until and

including the 2024-2026 PSP. However, for that

qualifier, Gender Representation is calculated on

a global basis including US and Puerto Rico. See

page 95 for details on the Performance Share Plan

ESG qualifier on gender representation.

Measure shows the engagement index at Haleon

calculated as an average favourability score on three

questions: 1) I am proud to work for Haleon; 2) My

work gives me a feeling of personal accomplishment;

and 3) I would recommend Haleon as a great place

to work.

2024

2025

(55)%*

(50)%

2024

2025

(9)%*

(1)%

2023

2024

2025

82%

81%

78%

2024

2025

46.3%

44.6%

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

quarter. Had we had a normal cold and

flu season, organic growth would have

been 3.4%.

We continue to operate in attractive

categories with long-term consumer

tailwind trends such as increased focus

on health and wellbeing. This alongside

our trusted brands, healthy innovation

pipeline and leading category positions,

are the key reasons we remain confident

in our medium-term guidance of 4-6%

revenue growth.

During the year, we continued at pace

to unlock savings from productivity,

particularly across the supply chain

where we made strong progress in

reducing SKUs, packaging specifications

and formulations. This, combined

with pricing resulted in adjusted gross

profit growth of 4.4% (constant

currency) and 220bps of margin

expansion (constant currency) (reported:

3.8% with 350bps of margin expansion).

Unlocking efficiencies across the supply

chain remains an area where we continue

to see significant potential.

Our strong gross profit performance,

meant that we were able to invest in

the business at a healthy rate with

advertising and promotional (A&P) spend

2025 was a pivotal year for Haleon,

marked by the introduction of our value

creation framework to deliver industry-

leading returns. Despite a softer

consumer and customer environment,

with global category growth falling

below historic averages, we delivered

strong financial results, in line with our

value creation framework. We delivered

strong organic operating profit driven

by strong gross margin improvement

enabling further investment in the

business whilst delivering more to

the bottom line, combined with strong

cash generation enabling disciplined

capital allocation.

I would like to thank everyone at Haleon

for all their efforts in delivering strong

financials and building solid foundations

for continued momentum in 2026.

High quality earnings

For the year, organic revenue increased

3.0% (reported: (1.8)%) to £11.0bn with

our consumption outperforming the

market by 40bps. Headwinds from

foreign exchange and net M&A reduced

revenue by 2.8% and 2.0% respectively.

Organic growth was held back by a

weakening consumer environment

and lower levels of cold and flu which

impacted performance in the fourth

up 7.5% constant currency (reported:

+4.7%) to 20.5% of revenue. Investment

was focused on our core, key growth

markets such as India and driving

innovation. At the same time, we looked

to maximise the effectiveness of our

spend. Adjusted R&D spend was up 7.7%

constant currency (reported: +6.1%)

focused on a number of key areas

including scientific evidence generation

for new and differentiated claims along

with digital enablement.

Altogether, organic profit growth of

10.5% (reported: +9.3%) represented

160bps of margin growth (reported:

230bps). This was partly offset by a drag

from net M&A ((70) bps) and FX ((30)bps)

which resulted in adjusted operating

margin up 60bps at actual rates.

Adjusted EPS was up 5.0% to 18.8p

(reported EPS: up 17.8% to 18.5p) largely

reflecting the strong profit performance,

lower dividend payments for our China

JV and the impact of the £500m share

buyback.

Chief Financial

Officer’s review

2025 Finance review

9.3%

Operating profit

growth

£2.6bn

Net cash inflow from

operating activities

10.5%

Organic operating

profit growth

£1.9bn

Free cash flow

Dawn Allen

Chief Financial Officer

We delivered strong ﬁnancial

results, in line with our value

creation framework.

During the year, we continued at pace

to unlock savings from productivity,

particularly across the supply chain where

we made strong progress in reducing SKUs,

packaging speciﬁcations and formulations.

Haleon

Annual Report and Form 20-F 2025

Strong cash performance

Our cash performance was also strong,

with free cash flow of £1.9bn, up £194m

on a like-for-like basis (i.e. excluding the

impact of divestments in 2024 including

net proceeds of £325m offset by £(100m)

of associated tax payments). This was

helped by a strong improvement in our

working capital cycle which reduced

by 11 days. Working capital continues

to be an area where we see further

optimisation opportunity.

Capital expenditure of £413m (2024:

£318m) was weighted towards growth

and productivity with spend largely

devoted to systems, processes and

automation.

Driving shareholder returns

During the year, we returned £1.1bn

to shareholders through a £500m

buyback with the remainder coming

from dividends. This, along with spend

to complete the full buyout of our

China JV and our strong free cash flow

performance meant that we were able

to reduce leverage by £0.6bn to £7.3bn

representing 2.6x net debt/adjusted

EBITDA (2024: 2.8x); in line with our

medium-term guidance.

As highlighted at our Capital Markets

Day, we continue to believe c.2.5x net

debt/adjusted EBITDA is the right

leverage for Haleon over the medium

term. This enables the business to

appropriately balance our capital

allocation priorities of maintaining a

strong investment grade balance sheet,

to invest for growth and explore bolt-on

acquisitions, as well as return surplus

capital to shareholders.

Income statement summary

2025

£m

2024

£m

% change

Revenue

11,030

11,233

(1.8)

Revenue growth

(1.8%)

(0.6%)

Organic revenue growth

3.0%

5.0%

Gross profit

7,080

6,824

3.8

Adjusted gross profit

7,193

7,099

1.3

Operating profit

2,412

2,206

9.3

Adjusted operating profit

2,526

2,500

1.0

Net finance costs

(262)

(302)

(13.2)

Profit before tax

2,152

1,910

12.7

Profit after tax attributable to shareholders of the Group

1,667

1,442

15.6

Adjusted profit after tax attributable to shareholders of the Group

1,697

1,638

3.6

Earnings per ordinary share

Diluted (pence)

18.5

15.7

17.8

Adjusted

(pence)

18.8

17.9

5.0

Definitions and calculations of non-IFRS measures can be found from page 205.

For a discussion of the Group’s financial and operating performance for the year ending 31 December 2024, see Haleon’s 2024 Annual

Report and Form 20-F, pages 34-42.

Given these priorities, the Board has

proposed a final dividend for 2025 of

4.9p per ordinary share and a total

dividend of 7.1p per ordinary share, up

7.6% year on year. In addition, we have

announced the allocation of £500m to

share buybacks in 2026. This reflects our

expectation for another year of strong

financial performance.

Looking ahead

We are making good progress in

transforming Haleon into a world-class

consumer company. However, there is

more to do to become truly agile and

relentlessly consumer-focused.

The evolution of our operating model

will be key to driving this shift. Through

our value creation framework, we are

focused on building flexibility and agility

in our P&L by unlocking productivity

savings to fund sustained investment in

growth. Alongside this, an even sharper

focus on return on capital reinforces

our confidence in our medium-term

guidance. I am confident that Haleon is

well positioned to deliver another year

of strong financial performance and

create value for all our stakeholders.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Revenue

Reported revenue declined 1.8% to

£11,030m (2024: £11,233m) but grew

3.0% organically for 2025. This was

below our medium-term expectations,

primarily reflecting a weak cold and flu

season and low consumer confidence

in North America. The net impact of

foreign exchange and net M&A reduced

revenue by 2.8% and 2.0% respectively,

the latter reflecting the effect of the

2024 disposals of ChapStick and

Nicotine Replacement Therapy business

outside the US.

Gross profit

Reported gross profit increased by

3.8% to £7,080m (2024: £6,824m) with

gross margin up 350bps to 64.2%.

Adjusted gross profit increased by

1.3% at actual exchange rates and

4.4% at constant currency to £7,193m

(2024: £7,099m). Key drivers of margin

expansion included pricing to offset

inflation, net revenue management

and benefits from the supply chain

productivity programme. Adjusted

gross profit margin increased 200bps

at actual exchange rates to 65.2%

(2024: 63.2%) and 220bps at constant

currency to 65.4%.

Operating profit

Reported operating profit increased

by 9.3% to £2,412m (2024: £2,206m)

and reported operating profit margin

increased 230bps to 21.9% (2024:

19.6%).

Adjusted operating profit increased

by 1.0% at actual exchange rates to

£2,526m (2024: £2,500m) and increased

10.5% on an organic basis. Adjusted

operating profit margin increased 60bps

to 22.9% (2024: 22.3%). On an organic

basis, adjusted operating profit margin

increased 160bps, driven by progress on

productivity initiatives and operating

leverage to support investment in

long-term performance.

For the year, A&P spend was up 4.7% at

actual exchange rates, and up 7.5% at

constant currency, representing 20.5%

of revenue (2024: 19.2%). Adjusted R&D

expenditure was £315m (2024: £297m),

up 6.1% at actual exchange rates and up

7.7% at constant currency, with increased

investment across key innovation areas

and superior evidence generation.

Adjusting items within operating profit

totalled £114m in 2025 (2024: £294m).

This included the amortisation and

impairment of intangible assets of £60m

(2024: £147m). In the prior year, £135m

related to the impairment of Nexium

from weaker market conditions in the

Proton Pump Inhibitor (PPI) category.

During 2025, Nexium was reclassified to

a definite life amortised brand and no

further impairment has been recognised

for Nexium. Restructuring costs totalled

£89m (2024: £214m) and included

amounts related to the productivity

programme and two site closures.

Transaction-related costs and separation

and admission costs were £nil in 2025

(2024: £(1)m and £30m respectively).

Disposals and other items amounted to

£(35)m (2024: £(96)m) and included gains

related to prior year divestments and

settlements.

Net finance costs

Net finance costs were £262m (2024:

£302m). This reflected finance costs

of £340m (2024: £384m) and finance

income of £78m (2024: £82m). Lower

net finance costs largely relate to the

reduction in debt and lower interest

rates.

Tax charge

The statutory tax charge of £472m (2024:

£435m) represented an effective tax rate

on IFRS results of 21.9% (2024: 22.8%).

The tax charge on an adjusted basis was

£554m (2024: £527m) and the effective

tax rate on an adjusted results basis was

24.5% (2024: 24.0%).

Profit after tax and earnings

per share

Profit after tax attributable to

shareholders of the Group was £1,667m

(2024: £1,442m) and adjusted profit after

tax attributable to shareholders was

£1,697m (2024: £1,638m), up 3.6% at

actual exchange rates.

Diluted earnings per share increased

17.8% to 18.5p in 2025 (2024: 15.7p).

Adjusted diluted earnings per share

increased 5.0% to 18.8p (2024: 17.9p)

reflecting slight growth in adjusted

operating profit, lower net finance costs

and non-controlling interest, and a 1.6%

reduction in diluted weighted average

share count following the buyback of

shares in 2025. This was partly offset

by a higher tax rate on adjusted profit

before tax.

2025 Finance review

continued

Haleon

Annual Report and Form 20-F 2025

Geographical segment performance

Revenue by geographical segment for the year ended 31 December

Revenue (£m)

Revenue change (%)

2025

2024

Reported

Organic

Price

Vol/Mix

FX impact

Net M&A

impact

North America

3,866

4,042

(4.4)%

(0.4)%

1.0%

(1.4)%

(3.0)%

(1.0)%

EMEA & LatAm

4,592

4,631

(0.8)%

4.7%

4.2%

0.5%

(2.3)%

(3.2)%

APAC

2,572

2,560

0.5%

5.2%

1.0%

4.2%

(3.3)%

(1.4)%

Group

11,030

11,233

(1.8)%

3.0%

2.3%

0.7%

(2.8)%

(2.0)%

Price and volume/mix are components of organic revenue growth. Definitions and calculations of non-IFRS measures can be

found from page 205.

Adjusted operating profit by geographical segment for the year ended 31 December

Adjusted operating

profit

(£m)

YoY

change

YoY Organic

change

FX impact

Net M&A

impact

2025

2024

2025

Group operating profit

2,412

2,206

9.3%

Reconciling items between adjusted

operating profit and operating profit

114

294

(61.2)%

Group adjusted operating profit

2,526

2,500

1.0%

10.5%

(3.8)%

(5.7)%

North America

947

1,000

(5.3)%

1.9%

(4.4)%

(2.8)%

EMEA & LatAm

1,090

1,054

3.4%

15.9%

(3.5)%

(9.0)%

APAC

553

539

2.6%

13.1%

(6.7)%

(3.8)%

Corporate and other unallocated

(64)

(93)

31.2%

9.0%

22.6%

(0.4)%

Group adjusted operating profit

2,526

2,500

1.0%

10.5%

(3.8)%

(5.7)%

Definitions and calculations of non-IFRS measures can be found from page 205.

Reconciling items for these purposes are the adjusting items, which are defined under Use of non-IFRS Measures on page 205.

A reconciliation between operating profit and adjusted operating profit is included under Use of non-IFRS Measures.

On a segment basis, adjusted operating profit is the measure of segment profit or loss reviewed by the Company’s chief

operating decision maker. Adjusting items are not allocated by segment, as these items are managed centrally by the Group,

and therefore are not part of the measure of segment profit or loss reviewed by the Company’s chief operating decision maker.

Adjusted operating profit margin by geographical segment for the year ended 31 December

Adjusted operating

profit

(£m)

YoY

change

YoY Organic

change

FX impact

Net M&A

impact

2025

2024

2025

North America

24.5%

24.7%

(20)bps

50bps

(30)bps

(40)bps

EMEA & LatAm

23.7%

22.8%

90bps

230bps

(30)bps

(110)bps

APAC

21.5%

21.1%

40bps

150bps

(70)bps

(40)bps

Group

22.9%

22.3%

60bps

160bps

(30)bps

(70)bps

Definitions and calculations of non-IFRS measures can be found from page 205.

Geographical segment performance

North America

2025

£m

2024

£m

Change (%)

YoY

Organic

Price

Vol/Mix

Revenue

3,866

4,042

(4.4)%

(0.4)%

1.0%

(1.4)%

Adjusted operating profit

947

1,000

(5.3)%

1.9%

n/a

Adjusted operating profit margin

24.5%

24.7%

(20)bps

50bps

n/a

Definitions and calculations of non-IFRS measures can be found from page 205.

Price and volume/mix are components of organic revenue growth.

2025 reported revenue was £3,866m (2024: £4,042m), a decline of (4.4)% on a reported basis,

which included the negative impact of exchange rates of (3.0)% and a (1.0)% impact from net

M&A. As a result, revenue declined (0.4)% on an organic basis with 1.0% price and (1.4)%

volume/mix. The headwind from cold and flu, which held back organic growth in Q4, was offset

by a better performance in Oral Health and VMS. Overall, in 2025, Haleon consumption grew

ahead of a slightly declining market. The broader market was impacted by weaker consumer

confidence from concerns around the labour market and inflation.

Organic revenue growth reflected the resilience of categories such as Oral Health as well as an

improved performance in Advil. However, this was more than offset by the impact of a weak

US consumer and retail environment particularly across more discretionary categories such as

Smokers’ Health. In addition, seasonal OTC categories including cold and flu were impacted by

lower levels of incidence.

— In 2025, mid-single digit growth in Oral Health was driven by Sensodyne and parodontax.

— VMS declined low-single digit with an improved performance from Centrum in the second half

of the year and good growth in Emergen-C.

— Pain Relief was flat with growth in Voltaren more than offset by a decline in Excedrin.

— Respiratory Health declined mid-single digit with a double digit decline in Q4 from a weaker

cold and flu season. Smokers’ Health declined double digit.

— Digestive Health was flat with growth in Tums and Benefiber partly offset by a decline in

Nexium.

Adjusted operating profit declined (5.3)% and grew 1.9% organically, driven by cost efficiencies

which were partly offset by an increase in A&P. Adjusted operating profit margin was 24.5%,

up 50bps on an organic basis.

Revenue growth

(4.4)%

Organic revenue growth

(0.4)%

Organic operating profit growth

1.9%

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

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

2025

£m

2024

£m

Change (%)

YoY

Organic

Price

Vol/Mix

Revenue

4,592

4,631

(0.8)%

4.7%

4.2%

0.5%

Adjusted operating profit

1,090

1,054

3.4%

15.9%

n/a

Adjusted operating profit margin

23.7%

22.8%

90bps

230bps

n/a

Definitions and calculations of non-IFRS measures can be found from page 205.

Price and volume/mix are components of organic revenue growth.

2025 reported revenue was £4,592m (2024: £4,631m), a decrease of (0.8)% on a reported basis,

which included the negative impact of exchange rates of (2.3)% and a (3.2)% impact from net

M&A. As a result, organic revenue grew 4.7% with 4.2% price and 0.5% volume/mix.

Geographically, Middle East & Africa, Latin America and Central & Eastern Europe saw mid-single

digit organic growth, and there was a resilient performance in Southern Europe and Northern

Europe. Growth in Q4 was held back by a weak cold and flu season particularly across Central &

Eastern Europe.

Haleon consumption outperformed the market, helped by the strength of our channel mix,

innovation and strong brands. Consumer confidence was impacted by inflation in Europe and

Latin America which resulted in value seeking behaviour.

— High-single digit growth in Oral Health was supported by strong growth from Sensodyne,

Polident/Poligrip and parodontax.

— Mid-single digit growth in VMS was led by Centrum up high-single digit partly offset by a

decline in some local brands.

— Pain Relief increased mid-single digit driven by Panadol.

— Performance in Respiratory Health was impacted by a weak cold and flu season.

— Therapeutic Skin Health & Other grew mid-single digit reflecting strength in Zovirax.

Adjusted operating profit increased 3.4% and 15.9% organically, driven by cost efficiencies which

were partly offset by an increase in A&P. Adjusted operating profit margin was 23.7%, up 230bps

on an organic basis.

Revenue growth

(0.8)%

Organic revenue growth

4.7%

Organic operating profit growth

15.9%

Asia Pacific (APAC)

2025

£m

2024

£m

Change (%)

YoY

Organic

Price

Vol/Mix

Revenue

2,572

2,560

0.5%

5.2%

1.0%

4.2%

Adjusted operating profit

553

539

2.6%

13.1%

n/a

Adjusted operating profit margin

21.5%

21.1%

40bps

150bps

n/a

Definitions and calculations of non-IFRS measures can be found from page 205.

Price and volume/mix are components of organic revenue growth.

2025 reported revenue was £2,572m (2024: £2,560m), an increase of 0.5% on a reported basis,

which included the negative impact of exchange rates (3.3)% and a (1.4)% impact from net M&A.

As a result, organic revenue growth in APAC was 5.2%% with 1.0% price and 4.2% volume/mix.

Strong volume growth was driven by China, India and South-East Asia & Taiwan through

innovation and growth across online channels combined with successful in-market execution.

China grew mid-single digit, and India saw continued momentum with double digit growth.

South-East Asia & Taiwan and North Asia both grew mid-single digit whilst Australia and New

Zealand were up low-single digit.

Haleon consumption outperformed the market. Consumer confidence in China remains steady

with continued preference for brands and ongoing strength in E-comm. In India, GST reforms

have boosted consumer sentiment.

— Oral Health grew double digit driven by strong growth in Sensodyne in India and parodontax

in China.

— VMS delivered mid-single digit growth, with strong growth in Centrum, supported by a number

of innovations including Centrum Daily Kits. Caltrate was flat from lapping strong growth in

2024 when a competitor was out-of-stock; consumption of Caltrate continues to be healthy.

— Respiratory Health was flat given a softer cold and flu season during the first half and a normal

season in the second half of the year.

— Pain Relief was up mid-single digit underpinned by performance in Panadol.

— Digestive Health was up low-single digit. Therapeutic Skin Health & Other slightly declined.

Adjusted operating profit increased 2.6% and increased 13.1% organically. The organic increase

in adjusted operating profit was driven by positive operating leverage combined with

operational efficiencies, which more than offset an increase in A&P. Adjusted operating margin

was 21.5% and increased 150bps organically.

Revenue growth

0.5%

Organic revenue growth

5.2%

Organic operating profit growth

13.1%

2025 Finance review

continued

Haleon

Annual Report and Form 20-F 2025

Revenue by market category

Revenue by market category for the year ended 31 December

As announced in May 2025, the Group has adopted a new structure for reporting revenue by

market category. Compared to previous reporting, the new structure:

— Splits out Digestive Health & Other into Digestive Health, and Therapeutic Skin Health & Other.

— Smokers’ Health, which had previously been reported as part of Digestive Health & Other is

now included in Respiratory Health.

— There are no changes to other categories.

Revenue (£m)

Revenue change (%)

2025

2024

Reported

Organic

impact

Net M&A

impact

Oral Health

3,461

3,312

4.5%

7.9%

(3.4)%

—

VMS

1,685

1,696

(0.6)%

1.9%

(2.5)%

—

Pain Relief

2,564

—

2.3%

(2.3)%

—

Respiratory Health

1,873

2,122

(11.7)%

(1.9)%

(1.7)%

(8.1)%

Digestive Health

987

1,029

(4.1)%

0.5%

(4.4)%

(0.2)%

Therapeutic Skin Health & Other

460

510

(9.8)%

2.0%

(3.1)%

(8.7)%

Group revenue

11,030

11,233

(1.8)%

3.0%

(2.8)%

(2.0)%

Following the change in product category structure announced on 1 May 2025, 2024 figures have been restated.

Price and volume/mix are components of organic revenue growth. Definitions and calculations of non-IFRS measures can be

found from page 205.

Oral Health

In 2025, Oral Health reported revenue

increased 4.5% to £3.5bn with organic

revenue growth of 7.9% (excluding a (3.4)%

adverse impact of foreign exchange rates).

We continued to outperform the category

with market share gains supported by

innovations and geographic expansion,

combined with strong in-market execution.

Sensodyne organic revenue grew high-single

digit, with growth driven by innovation,

including the Clinical platform, with

Sensodyne Clinical White now available in

26 markets. The launch has contributed to

strong market share gains and driving

penetration by 130bps particularly amongst

younger consumers. The introduction of a

Sensitivity + Cavity toothpaste in over 65

markets including Indonesia and South Africa

is addressing affordability barriers.

We maintained momentum across our

gum health portfolio with the launch of

parodontax Gum Strengthen & Protect with

hyaluronic acid. This multi-format range

across both toothpaste and mouthwash has

expanded the brand into the key untapped

gum need-state of protective gum care. This

has now been launched in 18 markets with

good consumer feedback. Building on its

successful 2024 launch, Haleon expanded

parodontax’s distribution in China, contributing

to the brand’s global double-digit growth.

VMS

In VMS, 2025 reported revenue decreased

(0.6)% resulting in £1.7bn. On an organic basis,

revenue grew to 1.9% (excluding a (2.5)%

adverse impact of foreign exchange rates).

Mid-single digit growth in Centrum reflected

a strong performance in EMEA & LatAm and

APAC partly offset by a decline in North

America. The decline in North America

was a result of weak market conditions for

the multivitamin category and increased

promotions by competitors. The category

returned to growth in North America during

the second half of the year supported by the

activation of cognitive function claims on

Centrum Silver driving market share gains.

Caltrate was flat, after lapping a tough

comparative from a competitor being out

of stock in 2024. Growth was supported by

innovation including Caltrate Kids Liquid in

China, with patented Vitamin K2 formulation

driving 10x better absorption.

Emergen-C grew mid-single digit,

outperforming the immunity category

underpinned by innovation strength including

Emergen-C crystals, Emergen-C Immune+

and Zero Sugar.

In Oral Health, we continued to outperform the

category with market share gains supported

by innovations and geographic expansion,

combined with strong in-market execution.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

2025 Finance review

continued

Pain Relief

In Pain Relief, reported revenue was flat

resulting in £2.6bn of revenue. Organic

revenue growth was 2.3% (excluding

a (2.3)% adverse impact of foreign

exchange rates). Organic growth was

driven by mid-single digit growth in

Panadol underpinned by continued

share gains in a number of markets

including UK and Australia. Growth was

supported by innovation including

Panadol Dual Action, a paracetamol and

ibuprofen combination product which

leverages the technology in Advil. It is

now launched in nine markets.

Voltaren was up low-single digit with

growth in North America and Middle

East & Africa, partly offset by a decline

in Germany. Haleon’s innovation agenda

was supported by the expansion of 2%

medicated gels in China driving market

share gains.

Advil was flat, with an improving trend in

the US through the year, supported by

the launch of Advil PM LiquiGel Minis in

the US and the activation of a new

campaign in North America (No Pain,

More Gain).

Respiratory Health

In Respiratory Health, reported revenue

declined (11.7)% to £1.9bn with organic

revenue decline of (1.9)%. The 2025

decline in reported revenue included a

(8.1)% impact from net M&A (divestment

of non-US Smokers’ Health business) as

well as (1.7)% from foreign exchange

movements.

Performance was impacted by a weak

cold and flu season particularly in North

America and Central & Eastern Europe

in Q4 with total cold and flu organic

revenue down mid-single digit.

Robitussin declined double digit in Q4

with lower levels of cough incidences.

Otrivin grew mid-single digit with market

share gains in Otrivin Nasal Mist driven

by penetration from non-spray users in

launch markets of Sweden and UK. High

repurchase intent for the product was

supported by expert advocacy.

Smokers’ Health declined double digit in

2025. Excluding the impact of Smokers’

Health, Respiratory Health organic

revenue would have been broadly flat.

Digestive Health

In Digestive Health, reported revenue

declined (4.1)% resulting in £1bn of

revenue and 0.5% organic growth

(excluding a (0.2)% negative impact

from organic adjustments and a (4.4)%

adverse impact of foreign exchange

movements). Tums saw good growth

supported by expansion of Tums Gummy

Bites driving incremental penetration

and attracting new consumers to the

category in the US. Benefiber was up

high-single digit helped by its ‘Grow

What Feels Good’ campaign.

In India, Haleon launched ENO 3-in-1,

delivering consumers additional benefits

beyond heartburn such as indigestion

and bloating. Overall, the brand

declined, largely driven by double-digit

decline in Brazil from a weaker macro-

economic environment.

Therapeutic Skin Health & Other

reported revenue declined (9.8)% to

£0.5bn with organic revenue growth of

2.0% (excluding a (8.7)% negative impact

from organic adjustments and a (3.1)%

adverse impact of foreign exchange

rates). Organic revenue growth was

driven by

Zovirax

, up mid-single digit,

partly offset by a decline in

Fenistil

Despite a challenging consumer environment,

our brand portfolio performed well,

outperforming the market and with 60% of

the business gaining or maintaining share.

Haleon

Annual Report and Form 20-F 2025

Indebtedness, liquidity and

financial risk management

Indebtedness

At 31 December 2025, the Group’s total

borrowings were £8,609m (2024:

£10,127m), and the Group’s net debt

was £7,263m (2024: £7,907m).

Long-term financing consists of $6,000m

USD bonds, €2,250m Euro bonds and

£1,000m GBP bonds issued under the

Euro Medium Term Note programme as

well as CNY2,824m bank loans.

As at 31 December 2025, the Group’s

long-term credit rating with S&P is BBB+

and with Moody’s is A3. The Group’s

short-term credit ratings are A-2 and P-2

with S&P and Moody’s respectively.

Total borrowings/profit after tax was

5.1x and net debt/adjusted EBITDA was

2.6x as at 31 December 2025. Haleon

expects to operate with leverage of

around 2.5x net debt/adjusted EBITDA

over the medium term.

Cash generation

Net cash from operating activities

totalled £2,634m in 2025 (2024: £2,301m).

Free cash flow was £1,913m (2024:

£1,944m). This was up £194m compared

to 2024, before taking account of the

one-time net proceeds from divestments

in 2024 which included £325m gross

proceeds and £(100)m in associated tax

payments, primarily related to ChapStick.

Liquidity

At 31 December 2025, the Group had

total liquidity of £3,053m comprising

£1,750m of bank facilities and £1,324m of

cash and cash equivalents, less £21m of

bank overdrafts. The Group has undrawn

credit facilities of £1,750m (2024:

$1,300m and £900m) with a maturity

date of August 2028. As at 31 December

2025, no amounts were drawn under

these facilities (2024: £nil).

The Group uses short-term financing to

manage working capital requirements and

has access to a $10,000m US commercial

paper programme and a £2,000m Euro

commercial paper programme. There was

no commercial paper outstanding as of

31 December 2025 (2024: £nil).

Management believes that the Group

has sufficient working capital for present

requirements and to minimise liquidity

risk, the Group has policies to limit the

amount of debt maturing in any year.

In addition, policies require the Group

to always maintain a minimum available

liquidity, including undrawn revolving

credit facilities and available cash,

less commercial paper issued.

Interest rate risk

The Group’s strategic priorities are to

minimise interest costs and minimise

income statement volatility arising from

interest rates.

The Group has a policy to limit the

amount of floating rate debt it holds to

manage the amount of income statement

volatility. The Group regularly assesses

its interest rate profile in light of changes

to market interest rates.

At 31 December 2025, 67% of net debt

was fixed with the balance being

exposed to floating rates.

Foreign exchange translation risk

The Group’s policy is to manage Group

net debt such that the currency mix of

debt broadly aligns with the currency

mix of earnings, considering relative

interest costs and practical implications.

The currency mix of debt includes the

impact of foreign exchange and cross-

currency swaps.

USD

EUR

GBP

Currency mix of net debt*

(including swaps)

Deleveraging through a combination of

net debt reduction and adjusted EBITDA growth

Bond debt maturity profile (£bn)

Definitions and calculations of non-IFRS measures can be found from page 205.

Principal value of bond debt as at 31 December 2025.

Currency mix of total borrowings

(as issued)

7907

2025

2024

Net debt

(£m)

2838

2025

2024

Adjusted EBITDA

(£m)

0.0

2.8

2025

2024

Net debt/adjusted EBITDA

7,907

7,263

2,805

2,838

2.8x

2.6x

2052

2038

2037

2036

2035

2034

2033

2032

2031

2030

2029

2028

2027

2026

0.7

1.5

0.3

0.7

0.3

0.7

0.4

0.7

61% USD

27% EUR

18% CNY

7% CAD

Does not sum to 100% as it excludes 13%

of net assets in GBP and other currencies

52% USD

31% EUR

12% GBP

4% CNY

1% Other

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

defines the essential elements of the

Group’s approach to risk management

and compliance programmes, ensuring

risks associated with conducting

business activities are effectively

controlled, in line with the Board’s risk

appetite and compliance with regulatory

requirements. The framework is aligned

to the three lines model which assigns

roles and responsibilities for the

management of risks within Haleon.

Risk management framework

At Haleon, management of risk is firmly

embedded in our strategy to achieve our

long-term goals. We have a diverse range

of risks and have appropriate processes

and tools to identify risks before they

materialise. The framework is embedded

within the strategy and planning cycle,

which ensures accountability for the

identification, assessment, mitigation and

monitoring of risks aligned with our

strategic objectives. The framework

supports information flow and open

communication between the Board, the

Audit & Risk Committee (ARC), the

Executive Team, our functions, business

units, markets and sites. Our framework

Our approach

to risk

We understand the challenges and uncertainties we

face and take a proactive approach to risk management

to maximise opportunities, drive informed commercial

decision making, and protect our people and assets.

Risk management at Haleon

Top down

— Board/Board

Committees

— Executive Team Risk

Forum

— Annual enterprise

risk assessment

Bottom up

— Expert risk and

control functions

— Business unit and

function ongoing

risk/control strategy

review

— Business unit and

function annual risk

assessment

Internal inputs

— Internal data and

insights

— Strategic objectives

— Internal audit

outcomes

External inputs

— UK Corporate

Governance Code,

laws and regulations

— External partners

— External audit

outcomes

Assessment of

residual risk and

prioritisation

Risk

identiﬁcation

Management

action and

reporting

Control

strategy

Haleon

Annual Report and Form 20-F 2025

Board

Accountable for risk management and defining Haleon’s risk appetite towards achieving its strategic objectives

Executive Team Risk Forum

Provides leadership oversight by reviewing top risks. Approves risk mitigation strategies and ensures effective risk management practices.

Sets relevant risk management governance standards and policies

Internal Audit

Provides independent

and objective assurance

over the adequacy and

effectiveness of risk

management, controls

and governance

processes

Remuneration Committee

Sets the structure for the

Company’s Remuneration Policy,

reviews workforce remuneration

and aligns incentives and

rewards

Nominations & Governance

Committee

Leads the process for

appointments to the Board and

ensures corporate governance

standards are maintained

Environmental & Social

Sustainability Committee

Provides oversight and

governance over progress with

the ESG agenda and external

regulatory requirements

ARC

Provides oversight and effective

governance over processes and

systems for risk management,

controls and reporting

Risk management governance

Expert risk and control functions

Provides subject matter expertise to the business, defines policy and

control standards and challenges the management of risks

Enterprise Risk Management

Owns, designs and maintains the risk management framework. Provides

expertise, support, challenge and monitors risk-related matters.

Enhances the level of risk awareness of all employees through

education workshops and training

Business units and functions

Establishes and maintains appropriate structures and processes of risk management and related control strategy. Owns business

unit/functional risks, applies the risk management framework and ensures compliance with legal, regulatory and ethical expectations

Bottom-up

Top-down

First Line – ownership and operation of processes

Third Line – independent assurance

Leadership – accountability to stakeholders for organisational oversight

Second Line – risk management expertise and control framework design

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our approach to risk

continued

These governance forums provide the

Risk Forum with a bottom-up view of

risks and issues along with oversight of

how the key risks are being managed.

Open communication and adequate

reporting remain essential to ensure

Haleon’s leaders maintain a sound risk

culture and are kept informed, to allow

for swift decisions and meaningful

actions. An annual management

confirmation review across each business

unit and function ensures key risks are

well managed and that corrective and

preventative actions are in place to

address any significant gaps.

Assessing risk

We continuously assess and evaluate

the risks posed by the changing

environments in which we operate to

ensure an appropriate, measured, and

timely response by considering potential

impacts and most likely scenarios.

The annual enterprise risk assessment

(ERA) for 2025 included a risk survey and

interviews with the Board, Executive

Team and business unit general

managers to identify and evaluate both

current and emerging risks, and to inform

the 2026 internal audit plan. The ERA

outcome also reflects whether we think

the impact and likelihood associated

with each of our enterprise risks are

increasing, unchanged or decreasing.

The top-down process is complemented

by horizon scanning to identify external

trends. Inputs from risk review meetings

at all levels of the organisation help

us identify opportunities and/or

emerging risks.

The Board has ultimate accountability

for managing the Group’s risks and

setting our risk appetite in line with our

strategic objectives. The Board ensures

appropriate oversight through various

mechanisms, including strategy meetings,

management reports and reviews of

selected risk areas.

To assist the Board in discharging its

responsibilities, the ARC is responsible

for reviewing and assessing the

effectiveness of the Group’s risk

management and internal control

systems, covering the Group’s enterprise

risks, financial and operational controls

and procedures.

The Executive Team is joined by the

Head of Audit and Risk and Head of

Enterprise Risk Management to form the

Executive Team Risk Forum (Risk Forum).

The Risk Forum met six times in 2025 to

ensure that risks were adequately

managed, and the risk management

framework was effectively deployed

throughout the Group. The Risk Forum:

discusses enterprise and emerging risks;

business unit risks; reviews industry

trends; regulatory developments;

high-profile incidents and critical audit

findings. Each enterprise risk is owned by

a member of the Executive Team, who is

accountable for designing and

implementing risk mitigation strategies

and regularly reporting risk updates to

the ARC and Risk Forum. At a functional,

business unit, market and site level,

regular risk review meetings ensure a

more granular review of risk and

operationalisation of strategic priorities.

The ERA results have been shared with

the ARC and the Board to confirm the

principal risks and agree on the Group’s

risk management priorities for 2026.

Where the level of risk taken is likely to

exceed or has exceeded desired levels in

the period, management action is taken

to further reduce the risk.

Our principal risks

Our principal risks are a subset of our

enterprise risks and are deemed by the

Board to be the most significant risks

faced by the Group, including those that

can materially impact our performance

and/or reputation and could threaten our

long-term business model or liquidity.

Our principal risks remain unchanged

from the previous year, are not listed in

any particular order and do not comprise

an exhaustive list of risks associated with

the business. While a robust assessment

of these risks has been undertaken,

additional risks not known to the Board

or assessed to be less significant may

also materialise and result in an adverse

effect on the business. Haleon also faces

other enterprise risks that we manage as

part of our integrated risk management

framework including: health and safety;

product quality; product user safety;

financial; legal and compliance; and

enterprise transformation.

We continuously assess and evaluate

the risks posed by the changing

environments in which we operate

to ensure an appropriate, measured,

and timely response by considering

potential impacts and most

likely scenarios.

Haleon

Annual Report and Form 20-F 2025

Principal risk and link to strategy

Description and risk development

Mitigation

Growth model

Our success depends on our ability

to identify and explore business

opportunities to deliver organic

growth.

Oversight forum

Board

Risk owner

Chief Growth Officer

Risk category

Strategic

Failure to meet our medium-term organic growth guidance due to inadequate strategic

planning, lack of innovation, and poor execution could result in erosion of shareholder

value and damage to our reputation.

The growth potential across the consumer health sector remains high, but this also

means that the sector continues to attract new global and local competitors,

intensifying competition and putting pressure on pricing, margins and market share.

Our continued growth is dependent on our ability to successfully deliver an activity

plan (innovation and marketing/activation activities) that is responsive to changing

consumer preferences. Strengthening our innovation capability continues to be a

priority, particularly as we seek to expand our reach to lower-middle income consumers.

The customer and channel environment is becoming more complex with increasing

pressure on traditional channels, growing influence of international buying groups

and disruptive digital platforms all heightening our commercial execution risk.

See also our

business model

page 4.

We are actively implementing our Win as One strategy, achieving our growth objectives

by increasing household penetration and capitalising on new and emerging

opportunities.

Our global and local teams drive growth across our portfolio, leveraging scale and

consumer-centric innovation. We are expanding our consumer base reaching more

lower-middle income consumers.

Business units and functions conduct robust strategic and financial planning

throughout the year, complemented with the identification of inorganic growth

opportunities.

We maintain an integrated forecast and demand planning process, ensuring discipline

in pricing drivers and efficient commercial execution. Win as One strategic objectives

are tracked and our company performance is benchmarked against competitors.

We have a clear value proposition across all sales channels, while actively pursuing

opportunities to enhance route to market, increase profitability, grow market share,

and expand our digital capabilities.

Principal risk and link to strategy

Description and risk development

Mitigation

People and organisation

Talent attraction and retention is

pivotal to the success of Haleon,

as is the effectiveness of our

operating structures.

Oversight forum

Remuneration Committee

Risk owner

Chief Human Resources Officer

Risk category

People

Failure to build a fit for the future organisation due to inadequate people, processes

and systems, may impact our ability to embed cultural change and achieve our

strategic objectives as a desired employer in a highly competitive market.

Strengthening our people operating model continues to be a priority as we focus on

delivering our Win as One strategy and unlocking headroom for growth.

This includes attracting, developing and retaining a diverse range of highly skilled

individuals and defining the future ways of working we need to achieve our

ambitions.

See also our

culture and people

section from

page 35.

We have a clear employer value proposition reflecting our strong corporate brand and

reputation. Our culture transformation is helping drive the change required to embed a

purpose-led consumer and performance culture.

We have strengthened the talent agenda through a range of initiatives focused on

deepening our reputation as an employer of choice. Talent identification and succession

planning exercises are undertaken for critical senior management positions. We actively

strengthen our pipeline through leadership development initiatives, optimising both

talent management and leadership continuity.

Our annual Haleon employee engagement survey consistently shows high-level

participation rates (89%) and provides us with valuable insights. Improvement areas

and corresponding action plans are closely monitored by senior leadership.

Learning and development programmes are in place, to ensure our people realise their

full potential.

We remain focused on building an inclusive workplace. Our Inclusion & Belonging (I&B)

strategy, overseen by our Global I&B council, helps to ensure all employees have equal

opportunities for growth and development.

Strategy key

Health in more hands

Superior brands

Wired for excellence

Full potential people

Trend key

Increasing risk

Decreasing risk

Unchanged

New risk

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our approach to risk

continued

Principal risk and link to strategy

Description and risk development

Mitigation

Trusted ingredients

Haleon’s brands must reflect

trusted science and ingredients

to consumers.

Oversight forum

Audit & Risk Committee

Risk owner

Chief R&D Officer

Risk category

Operational

Loss of customer confidence due to not pursuing best-in-class science or not

effectively monitoring and responding to emerging ingredient data, regulatory

changes and shifts in consumer perception, could negatively impact our brands

and our reputation.

We operate in a dynamic environment where the safety, efficacy, purity and

potential environmental impact of our ingredients are subject to evolving scientific,

regulatory and consumer scrutiny. Challenges to our ingredients may also arise from

unforeseen external factors, including political, economic or populist influences

that lack scientific foundation.

Monitoring our ingredient-related risks and taking proactive measures to address

emerging ingredient regulations and industry trends remains a key focus.

Haleon may incur liabilities or be forced to recall products as a result of real or

perceived product quality or other product-related issues, see page 184.

More information is available at

www.haleon.com/our-impact/environment

Our approach and success as a global consumer health company is underpinned by our

understanding of the evolving science of ingredients and in-depth insight into consumer

needs and preferences.

Ingredient-related risks are managed through our Trusted Ingredients Framework,

enabling us to collect intelligence from multiple external sources to inform our proactive

approach and response to ingredient risks anywhere in the world.

Cross-functional teams across Haleon conduct continuous monitoring of ingredient and

materials data (including science literature and health authority guidance) to facilitate

the early detection of emerging ingredient risks. When new risks are identified, actions

required to proactively manage and mitigate the risk are assessed, which could include

the assignment of a dedicated multidisciplinary taskforce.

We operate robust controls to systematically assess all ingredients used in our products.

Prior to introducing a new ingredient into our portfolio, we undertake an independent

evidence-based review to ensure its safety and suitability for our consumers.

We participate in a range of external partnerships and industry collaborations,

helping us to gain insights and improve the environment we operate in for the benefit

of consumers.

Principal risk and link to strategy

Description and risk development

Mitigation

Supply chain resilience

Continued challenges to our supply

chain capacity test our resilience

to ensure we meet increasing

customer demand.

Oversight forum

Board

Risk owner

Chief Supply Chain Officer

Risk category

Operational

Disruption or constraints in our global sourcing and supply network due to internal

and external factors or insufficient capacity, leading to the inability to meet

consumer demand and desired service levels.

We operate a complex global supply chain that is susceptible to a variety of internal

risks including product quality, the health and safety of our people and labour

shortages. External threats include geopolitical instability, extreme weather events

and cyber-security incidents.

In addition, indirect factors such as energy and commodity volatility can

significantly disrupt our operations. Building resilience into our supply chain is

critical so we can continue to operate in the event of these risks materialising.

To support the achievement of our Win as One ambitions, we continue to

optimise our global supply capacity and align our supply capabilities with future

consumer demand.

We remain committed to strengthening resilience through proactive risk management,

ongoing capacity optimisation, and rigorous oversight of external partners.

To safeguard our supply chain, we have implemented a holistic range of programmes

designed to proactively manage risk and improve resilience.

Targeted investments across the network, combined with simplification of the portfolio,

are improving our operational efficiency and productivity. Transformation of our

Integrated Business Planning (IBP) processes enables us to better respond to growing

consumer demand for our products.

We continue to de-risk supply of critical materials through our dual sourcing roadmap,

increasing upstream supply chain resilience and our responsiveness to evolving portfolio

needs and market conditions.

Supply chain operations are managed through an extensive governance and control

framework, ensuring we adhere to local regulations and safety standards. Oversight and

continuous monitoring of key metrics is provided by senior management.

Crisis management and business continuity processes are in place, supporting effective

incident response and restoration of supply. Plans are regularly reviewed and tested.

Strategy key

Health in more hands

Superior brands

Wired for excellence

Full potential people

Trend key

Increasing risk

Decreasing risk

Unchanged

New risk

Haleon

Annual Report and Form 20-F 2025

Principal risk and link to strategy

Description and risk development

Mitigation

Environmental, social and

governance

Sustainability and climate-related

risks are integrated into our business

and investment decisions.

Oversight forum

Environmental & Social Sustainability

Committee

Risk owner

Chief Corporate Affairs Officer

Risk category

Operational

Robust ESG performance is important to Haleon and to our investors, customers,

consumers and employees. Failure to address ESG risks could damage our reputation,

leading to potential financial losses.

Evolving sustainability-related regulation and ongoing scrutiny from our stakeholders

reinforce the importance of maintaining robust social and environmental goals,

policies, performance, reporting and disclosure.

The delivery of our social and environmental goals is influenced by the environment

in which we operate. Important dependencies include: the transition to renewable

energy; and the availability of more sustainable raw and packaging materials.

Our business is exposed to environmental risks in the medium to long term, related

to climate change and our impacts and dependencies on nature, including water and

healthy soils. The unpredictable nature of these risks presents additional challenges

in our own operations and across our value chain. Reduced intergovernmental

commitment and cooperation to address climate change, nature and biodiversity loss,

intensifies these risks.

Our business is also exposed to some supply chains with inherent human rights and

deforestation risks including the palm oil supply chain.

See also our

approach to health inclusivity and sustainability

from page 15,

including our

TCFD and TNFD disclosure

from page 19.

Our ESG goals, policies and performance underpin our strategy and purpose.

Our goals and policies cover our material impacts, risks and opportunities, including but

not limited to: health inclusivity; human rights; carbon emissions; plastics and packaging;

sustainable sourcing; water; waste circularity; product quality; business ethics and

health and safety. Our goals and policies are established through detailed analyses,

benchmarking, and materiality assessments to ensure they are ambitious, relevant,

and attainable. Oversight is provided by our ESS Committee.

We continue to strengthen our data, processes and controls for sustainability reporting

and receive limited independent assurance over select KPIs. To ensure readiness for

evolving reporting and regulatory requirements, we track developments at a global,

regional and local level.

We update our climate risk scenario analysis regularly and review and mitigate relevant

risks related to climate and nature through actions plans as reported in our TCFD and

TNFD disclosures.

We have implemented a human rights due diligence process across our supply chain,

with a focus on highest risk suppliers and compliance with human rights standards.

Through our environmental goals and our actions to manage natural resources

responsibly, we track and manage our impacts on nature.

Principal risk and link to strategy

Description and risk development

Mitigation

Cyber security

Haleon’s operations depend on

robust and secure IT systems and

information management.

Oversight forum

Audit & Risk Committee, Board

Risk owner

Chief Digital and Technology Officer

Risk category

Operational

Cyber attack resulting in data theft or modification, major disruption to Haleon’s

systems, or our supplier and partner systems, could materially impact operations,

customers and consumers, harm our reputation and lead to significant financial

losses.

Cyber security threats continue to grow in number, velocity and sophistication.

The risk is heightened by the increasing use of cyber attacks by organised crime,

intensifying geopolitical conflicts, growing adoption of AI, and our growing

public profile.

In addition, cyber regulation is becoming more stringent and localised, with

individual countries, regions or markets requiring compliance to their standards.

As our activities rely on digital services, these threats have the potential to

significantly disrupt our global business, ultimately impacting our results or causing

harm to individuals.

We continuously improve the maturity of our cyber defences and technology control

framework, optimising the usage of tools, simplifying workflows and building capability.

Our focus remains on ensuring regulatory compliance across all our markets and

businesses. From this solid foundation we are able to focus on risks to Haleon, including

those faced by our manufacturing sites and supply chain.

Leading external organisations are engaged to optimise our cyber defences, improve the

maturity of our operating practices and drive increased resilience for our business.

This includes regular assurance of our cyber maturity and independent security and

penetration testing.

We continue to mature and expand the scope of key cyber security functions from

technology to people, which provides the foundation to protect against cyber security

threats to secure Haleon’s environment.

Strategy key

Health in more hands

Superior brands

Wired for excellence

Full potential people

Trend key

Increasing risk

Decreasing risk

Unchanged

New risk

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Our approach to risk

continued

Principal risk and link to strategy

Description and risk development

Mitigation

Geopolitical instability

Changes in the geopolitical

landscape are continuously

monitored.

Oversight forum

Board

Risk owner

Chief Corporate Affairs Officer

Risk category

Strategic

Failure to monitor and respond to increasing geopolitical tensions and

macroeconomic uncertainty may impair our ability to deliver our growth ambition

and strategic objectives, leading to commercial, financial and reputational losses,

challenging the exchange of products and services, and restricting the movement

of talent.

International cooperation remains under pressure with rising protectionism,

increased sanctions, reduced consensus on supranational guidelines and an

escalation in global tariffs in response to US trade policy. Macroeconomic

downturns across a number of markets are affecting investor sentiment and

consumer confidence. Social activism and misinformation are becoming more

frequent and present a risk to the integrity of our brands and corporate reputation.

The complex political relationship between the US and China, our two largest

markets, presents additional risk of trade disruptions, cash flow constraints and

reduced certainties on the opportunities for strategic growth.

Conflicts around the world continue to threaten our supply chain and market access,

including Russia and Ukraine, escalation in the Middle East and tensions across Asia.

We proactively monitor the geopolitical and macroeconomic environment to assess the

impact of emerging trends and events.

Scenario analysis is applied to our planning processes to evaluate potential impacts on

our business model and operations.

Our trade compliance and sanctions teams closely track relevant regulatory changes and

oversee import and export activities, while our Treasury function manages foreign

exchange risk exposure.

Country risk assessments are performed ahead of any capital investment. Crisis

management and business continuity planning is performed for all key markets and sites,

strengthening internal resilience and the resilience of our extended supply chain.

We are increasingly concerned about the persistent and widening conflicts around the

world and remain deeply committed to advancing everyday health with humanity, whilst

maintaining the safety, security and wellbeing of our employees. We continue to ensure

access to our essential health products and provide humanitarian support, especially in

areas affected by crisis and conflict.

Strategy key

Health in more hands

Superior brands

Wired for excellence

Full potential people

Trend key

Increasing risk

Decreasing risk

Unchanged

New risk

Haleon

Annual Report and Form 20-F 2025

Emerging risks

Emerging risks are uncertainties or potential disruptors that have not yet crystallised into specific risks and whose potential impact is difficult to predict. They are reviewed by the Board alongside

our enterprise risks. Key emerging risks identified in 2025 include the rapid development of AI and disruptive technology, increasing competition from local players, and potential escalation of tariffs

and trade wars.

Emerging risk

How could it impact us?

How are we responding

AI and disruptive technology

The rapid advancement of AI and other disruptive technologies, including new

digital and social commerce platforms, is transforming the environment in which we

operate, presenting both risks and opportunities for Haleon.

Our Responsible AI Policy and Principles provide guidance on the development and

adoption of AI across the business. These outline our enterprise-wide governance

framework and the controls, technology and cultural requirements necessary to mitigate

key risks.

Across the organisation we are building our digital capability in response to new

disruptive technology. Through our Haleon Digital Strategy (HDS) we are transforming

how we operate, deliver value to our consumers and remain competitive in the evolving

digital marketplace.

Increasing competition from local

players

Increasing competition from local players and private label manufacturers could

erode our strong market position, impact the relevance of our brands and intensify

price competition.

Our local and global teams partner to deliver consumer-centric innovation, underpinned

by a deep understanding of our local consumers, to ensure that our products offer a

compelling and differentiated value proposition.

Strengthening our in-market agility and commercial execution, combined with continued

investments across marketing and digital engagement, helps ensure our brands stay

relevant and accessible to consumers.

Escalation of tariff and trade wars

Further expansion of global tariffs and protectionism in 2026, including measures

targeting the sector and export controls, could disrupt our global supply chain,

increase costs and put additional pressure on consumer discretionary spending.

We have established a cross-functional tariff working group to analyse and quantify

different scenarios on our business and strategies to reduce our overall exposure.

We continue to engage and collaborate with trade and government bodies and

regulatory authorities to safeguard our commercial interests and support sustainable

growth in a complex global trade environment.

See also our

culture and people

approach to health inclusivity and sustainability (including our TCFD and TNFD disclosure)

Audit & Risk Committee Report

and

risk factors

sections on pages 35, 15, 70 and 181.

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Viability

statement

Stress testing was performed on a

number of scenarios, including the

potential impact of severe but plausible

scenarios over the viability period for

each potential combination of principal

risks identified below. In total, four

individual scenarios have been created

incorporating a combination of principal

risks. None of the scenarios modelled

were found to have an impact on the

long-term viability of the Group over

the assessment period. In addition, the

Group would be able to withstand the

impact of the most severe combination

of these risks with mitigating actions

available. These mitigating actions could

be reasonably implemented by the

Group and include reducing A&P spend,

reducing capital spend, pausing M&A

activity and cancelling shareholder

dividends.

Based on the assessment described

above, and considering the Group’s

current financial position, debt maturity

profile, stable cash generation, access

to liquidity, geographic diversification

and lack of concentration of supply, the

Directors have a reasonable expectation

that the Group is well positioned to

manage principal risks and the potential

downside impacts of such risks

materialising. As a result, the Directors

expect that the Company will be able

to continue in operation and meet its

liabilities as they fall due over the

assessment period.

In accordance with provision 31 of the

2024 UK Corporate Governance Code,

the Directors have assessed the viability

of the Group by considering the activities

and principal risks together with factors

likely to affect the Group’s future

development, performance, financial

position, cash flows, liquidity position

and borrowing facilities as described

in the Annual Report.

The Director’s assessment of viability has

been made over a three-year period,

which corresponds to the Group’s

planning cycle. Additionally, the Directors

believe this presents the readers of the

Annual Report with a reasonable degree

of confidence over the period assessed.

The assessment considered the Group’s

prospects related to revenue, operating

profit and free cash flow. The Directors

considered the maturity dates for the

Group’s debt obligations and its access

to public and private debt markets,

including its committed credit facilities.

The Directors also carried out a robust

review and analysis of the principal risks

facing the Group, including those risks

that could materially and adversely

affect the Group’s business model, future

performance, solvency and liquidity.

Scenario modelled

Key assumptions

Link to principal risks

Scenario 1:

A climate event

results in a major manufacturing

site shutdown for 18 months,

causing disruption to the supply

chain increasing commodity,

freight and labour costs.

—

Decrease in net revenue and gross profit as a result

of a loss of product sales.

—

Increase in commodity, freight and labour costs of

other manufacturing sites.

—

Supply chain resilience.

—

Trusted ingredients.

—

Environmental, social

and governance.

Scenario 2:

Group-wide cyber

event which results in the loss

of the IT network causing

disruption to manufacturing,

distribution and sales. Recovery

from the incident takes 4 weeks.

—

Decrease in net revenue and gross profit as a result

of a loss of product sales.

—

Cost of recovery and additional checks to ensure

formulations have not been corrupted.

—

Cyber security.

Scenario 3:

Slower economic

growth and competitor activity

(preventing sales price increases

or volume growth) combined

with inability to access capital

markets, inflationary pressure,

foreign currency volatility,

interest risks, and geopolitical

risks.

—

No price increases and forecasted growth, with a

corresponding impact on cost of goods sold due to

lower volumes.

—

Unable to access the commercial paper market or

to refinance existing commercial paper balances at

a reasonable cost.

—

Double interest costs on the portion of bond debt

subject to floating rates (i.e. including the impact

of derivatives).

—

Depreciation of major local currencies where the

Group generates its profits by 5% against Pound

Sterling.

—

No revenue and operating profit generated from

countries involved in armed conflict across the

plan period.

—

Growth model.

—

Geopolitical instability.

Scenario 4:

A significant incident

that leads to a product recall

and reputational damage for a

key brand resulting in the loss

of substantial sale of products

from this brand for six months.

—

75% decrease in sales and operating profit for a

Power Brand for six months.

—

Significant legal fine (5% of Group turnover).

—

Write off all inventories relating to the product of

the above Power Brand.

—

Additional investment in A&P to rebuild the brand.

—

Growth model.

—

Supply chain resilience.

—

Trusted ingredients.

Haleon

Annual Report and Form 20-F 2025

Statement

compliance

Section 172 statement

Details relevant to how the Directors have had regard to the matters set out in Section 172(1)(a) to (f)

of the Companies Act 2006 can be found across the Report, including, but not limited to, the Chair’s

statement and CEO’s review on pages 3 and 5, our culture and people from page 35, and our approach

to health inclusivity and sustainability from page 15. The Section 172 statement is provided on page 31.

Non-financial and sustainability information statement

Non-financial and sustainability information, including a description of policies, due diligence processes,

outcomes and risks and opportunities can be found as set out below. Internal verification and disclosure

controls apply to all the information covered in these areas. Our climate and nature-related financial

disclosures are contained in the TCFD and TNFD disclosures from page 19 and, for item (h), also on

pages 41, 177 and 178.

Further information about our

Health Inclusivity and Sustainability assurance activities

can be found at

www.haleon.com

/our-impact/esg-reporting-hub

A description of the business model

Our business model

Environmental matters

Our approach to health inclusivity and sustainability

Climate and nature-related financial disclosures

Our key performance indicators

Our approach to risk

Environmental & Social Sustainability

Committee Report

Note 1 General information: Impact of

climate change

129

Note 12 Property, plant and equipment:

Impact of climate change

137

Streamlined Energy and Carbon Reporting

177

Employee matters

Stakeholder engagement

Our culture and people

Our key performance indicators

Our approach to risk

Section 172 statement

Workforce engagement

Directors’ Remuneration Report

Miscellaneous Reporting Requirements

176

Our key policies and positioning statements, including our Code of Conduct can be

found on Haleon’s website:

Environment

www.haleon.com

/our-impact/environment

www.haleon.com

/who-we-are/Governance/codes-policies-

and-standards

www.haleon.com

/who-we-are/our-policy-positions

www.haleon.com

/our-impact/esg-reporting-hub

Employees

www.haleon.com

/our-impact/upholding-our-standards

www.haleon.com

/who-we-are/Governance/codes-policies-

and-standards

www.haleon.com

/who-we-are/our-policy-positions

www.haleon.com

/our-impact/gender-pay-gap

www.haleon.com

/our-impact/esg-reporting-hub

Social matters and

business conduct

www.haleon.com

/our-impact/upholding-our-standards

www.haleon.com

/who-we-are/Governance/codes-policies-

and-standards

www.haleon.com

/who-we-are/our-policy-positions

www.haleon.com

/our-impact/esg-reporting-hub

Human rights and

modern slavery

statements

www.haleon.com

/our-impact/upholding-our-standards

www.haleon.com

/who-we-are/Governance/codes-policies-

and-standards

www.haleon.com

/our-impact/esg-reporting-hub

www.haleon.com

/our-impact/human-rights

Anti-corruption

and anti-bribery

www.haleon.com

/who-we-are/Governance/codes-policies-

and-standards

The Strategic Report on pages 1 to 59 was approved by the Board on 13 March 2026.

Amanda Mellor

Company Secretary

Social matters

Our approach to health inclusivity and sustainability

Environmental & Social Sustainability

Committee Report

Human rights

Our culture and people

Anti-corruption and anti-bribery

Our culture and people

Audit & Risk Committee Report

Policy, due diligence and outcomes

Our approach to risk

Viability statement

Audit & Risk Committee Report

Non-financial key performance indicators

Our key performance indicators

Haleon

Annual Report and Form 20-F 2025

Strategic

Report

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Skills and experience

(excluding Executive Directors)

This table shows the number of Directors

with each relevant skill/experience.

Our Board of Directors

Chair and Executive Directors

Independent Non-Executive Directors

Strong,

experienced

leadership

Brian McNamara

Chief Executive Officer

Appointed: 23 May 2022

Skills and experience:

Drawing on extensive experience

in consumer healthcare, product supply, and brand

marketing, Brian has held senior leadership roles

within several major global organisations. His deep

understanding of the sector, combined with a proven

ability to drive growth across large and complex regions,

provides him with the strategic insight and leadership

capabilities needed to effectively guide and inspire

the Group.

Other significant appointments:

The Consumer Goods

Forum (Board Member), Mondelēz International, Inc.

(Non-Executive Director).

Previous roles:

GSK plc (CEO of the Consumer

Healthcare Business), Novartis AG (OTC Division Head

and a member of the Executive Committee), Procter &

Gamble (Product Supply and Marketing).

Dawn Allen

Chief Financial Officer

Appointed: 1 November 2024

Skills and experience:

Dawn brings a broad and deep

range of financial leadership experience within the

consumer goods sector, developed through senior roles

across global organisations. Her strong commercial

insight and international perspective are highly valuable

to the Board, contributing to strategic decision-making

and governance. She is a member of the Institute of

Chartered Accountants of England and Wales.

Other significant appointments:

ITV plc (Non-

Executive Director and Chair of the Audit & Risk

Committee as at 5 March).

Previous roles:

Tate & Lyle (Chief Financial Officer),

Mars Inc. (various country, region, divisional VP CEO

roles, most recent being VP and Global CFO Mars

Transformation), Tasty Bite Eatables (Non-Executive

Director), Ernst & Young (Senior Auditor).

Manvinder Singh (Vindi) Banga

Chair

Appointed: 18 July 2022

Appointed Chair: 1 January 2026

Skills and experience:

With over 30 years of leadership

experience, primarily within the global consumer goods

industry, Vindi has held a range of senior executive roles.

His expertise is further enriched by a portfolio of Chair

and non-executive directorships across various sectors,

in public and private capital markets, providing him with

a broad and balanced perspective on governance and

cross-industry dynamics, enabling him to provide the

Board with valuable leadership. Prior to being appointed

Chair of Haleon, Vindi held the role of Senior

Independent Director.

Other significant appointments:

CD&R LLP (Partner),

UK Government Investments (Chair), Imperial College

London (Chair of the Council), The Economist Group

(Non-Executive Director).

Previous roles:

GSK plc (Senior Independent Director),

Marks & Spencer plc (Senior Independent Director),

Unilever plc (various roles, most recent being President

of the Global Foods, Home and Personal Care business),

Confederation of British Industry (CBI) (Non-Executive

Director), Thomson Reuters Corp (Non-Executive Director).

Committee membership:

Committee Chair

Audit & Risk

Environmental & Social Sustainability

Nominations & Governance

Remuneration

Alan Stewart

Senior Independent Non-Executive Director (SID)

Appointed: 1 September 2024

Appointed SID: 1 January 2026

Skills and experience:

Alan offers extensive expertise in

corporate finance, accounting, and international business,

gained across a broad spectrum of consumer-focused

industries. His career includes extensive experience

serving on boards and in senior roles within listed

companies. Alan’s breadth of knowledge and boardroom

experience continues to be a valuable asset to the Board.

Other significant appointments:

Burberry plc

(Non-Executive Director and Audit Committee Chair),

UK & Ireland 2028 Limited (Non-Executive Director

and Audit Committee Chair).

Previous roles:

Diageo plc (Non-Executive Director and

Audit Committee Chair), Reckitt Benckiser Group PLC

(Non-Executive Director and Remuneration Committee

Chair), Games Workshop Group plc (Non-Executive

Director and Audit Committee Chair), Tesco plc

(Chief Financial Officer), Marks & Spencer plc

(Chief Financial Officer).

Nancy Avila

Independent Non-Executive Director

Appointed: 1 September 2024

Skills and experience:

Nancy brings considerable

experience in leading large-scale business

transformations through the strategic use of technology.

Her experience includes developing innovative digital

channels to drive growth, modernising operational

frameworks, and addressing regulatory compliance,

cyber security and financial risk. Most of her career

has been spent in senior technology and business

operations roles within several Fortune 100 companies,

giving her a deep understanding of how to align

technological advancement with business strategy.

Previous roles:

McKesson Corporation (Executive Vice

President, Chief Information Officer/Chief Technology

Officer), Johnson Controls Inc. (Vice President and

Chief Information Officer), Abbot Laboratories Inc.

(Vice President, Business and Technology Services),

Analog Devices, Inc. (Chief Information Officer),

Comerica Incorporated (Independent Director).

Marie-Anne Aymerich

Independent Non-Executive Director

Appointed: 18 July 2022

Skills and experience:

Marie-Anne contributes deep

experience in leading global brands across multiple

categories in the consumer goods and luxury sectors.

Her expertise lies in shaping premium product portfolios

and driving innovation, particularly within the oral care

industry. Her deep understanding of brand positioning

and consumer engagement across international markets

adds meaningful insight to the Board.

Other significant appointments:

Pierre Fabre Group

(Non-Executive Director), Academy of St Martin in the

Fields (Trustee and member of the Nomination

Committee).

Previous roles:

Unilever plc (Global Executive Vice

President, Oral Care and Managing Director, Home Care

and Personal Care), LVMH Group (Brand General

Director – Parfums Christian Dior).

Healthcare

Consumer & Retail

Finance

International

M&A/transformation

Supply chain

Sustainability/responsible business

Technology

Employee engagement

Digital/innovation

Governance/investor

Regulatory

Data as at the latest practicable date of 5 March 2026.

Haleon

Annual Report and Form 20-F 2025

Independent Non-Executive Directors continued

Bláthnaid Bergin

Independent Non-Executive Director

Appointed: 24 February 2025

Skills and experience:

A strong background in financial

leadership and strategic planning underpins Bláthnaid’s

career, developed through a range of executive and

non-executive roles across consumer-facing businesses.

As a qualified chartered accountant, Bláthnaid has spent

much of her career working across Europe, Asia, and

Australia, giving her a truly international outlook that

enhances her contribution to the Board.

Other significant appointments:

J Sainsbury plc

(Chief Financial Officer).

Previous roles:

Artemis Alpha Investment Trust

(Non-Executive Director, Chair of the Audit Committee

and Senior Independent Director), Aviva plc (Chief

Finance Operations Officer), RSA (various roles, most

recent being Group Financial Controller), GE (various

roles), Procter & Gamble (Finance Analyst).

Tracy Clarke

Independent Non-Executive Director

Appointed: 18 July 2022

Skills and experience:

With over 35 years of experience

in international banking and financial services, Tracy has

held a range of senior leadership roles that have shaped

her extensive expertise. Her broad experience in the

sector is complemented by her work as Chair of

Remuneration Committees for several organisations,

where she has demonstrated a strong ability to guide

complex discussions around remuneration strategy,

policy development, and governance. Her insights

continue to be a valuable asset to the Board.

Other significant appointments:

TP ICAP Group plc

(Non-Executive Director and Remuneration Committee

Chair), Starling Bank Limited (Senior Independent

Director and Remuneration Committee Chair),

Inchcape plc (Non-Executive Director).

Previous roles:

Standard Chartered Bank (various roles,

most recent being Private Bank CEO), Sky plc (Non-

Executive Director, Chair of the Remuneration Committee

and Big Picture Committee), Eaga plc (Non-Executive

Director), Inmarsat plc (Non-Executive Director).

Dame Vivienne Cox

Independent Non-Executive Director

Appointed: 18 July 2022

Skills and experience:

Bringing a wealth of experience

across multiple industries, Vivienne offers deep

expertise in the energy, natural resources, and

publishing sectors. Her career includes senior leadership

roles within large organisations, where she has focused

on areas such as gas, power, renewables, and emerging

alternative energy solutions. In addition to her industry

knowledge, Vivienne offers substantial expertise in

governance and regulatory affairs, which enhances

her ability to contribute meaningfully to Board-level

oversight and strategic decision making.

Other significant appointments:

Victrex plc (Chair and

Nominations Committee Chair).

Previous roles:

GSK plc (Non-Executive Director and

Workforce Engagement Director), BP plc (Executive

Vice President and Chief Executive), BG Group plc

(Non-Executive Director), Rio Tinto plc (Non-Executive

Director), Pearson plc (Senior Independent Director),

Vallourec (Chairman of the Supervisory Board), UK

Government’s Department for International

Development (Lead Independent Director).

Asmita Dubey

Independent Non-Executive Director

Appointed: 18 July 2022

Skills and experience:

Asmita brings over 25 years

of experience in consumer businesses, underpinned

by a strong track record in developing joint business

partnerships, particularly in China. Her extensive

expertise in marketing in the digital age, combined with

deep industry knowledge and international exposure,

enables her to provide strategic insights that are highly

valuable to the Board.

Other significant appointments:

L’Oréal (Chief Digital &

Marketing Officer and member of Executive Committee).

Previous roles:

GSK plc (Digital Advisory Board).

Board composition

1 Chair

2 Executive Directors

Independent Non-

Executive Directors

4 Men

7 Women

8 White

2 Asian/Asian British

Mixed/Multiple Ethnic Groups

5 British

3 American

1 Irish

1 Indian

1 French

Gender

Ethnicity

Nationality

Data as at the latest practicable date of 5 March 2026.

Matthew Shattock

Independent Non-Executive Director

Appointed: 1 June 2025

Skills and experience:

Matt joins the Board with

substantial experience in innovation, operational

leadership, and executive management within the

consumer goods and retail sectors. Over the course

of his career, he has led major business integrations,

revitalised brand portfolios, and driven sustained

global growth. He brings valuable industry insight

and leadership perspective to the Board.

Other significant appointments:

The Clorox Company

(Lead Independent Director), VF Corporation

(Non-Executive Director).

Previous roles:

Domino’s Pizza Group plc (Chairman),

Beam Suntory Inc (President, Chairman and CEO).

Company Secretary

Amanda Mellor

Company Secretary

Appointed: 23 May 2022

Skills and experience:

Amanda brings extensive

international experience in board practice, corporate

governance, investor relations and investment banking.

Other appointments:

Volution Group plc (Senior

Independent Director), GC100 (Executive Committee

Member).

The detailed breakdown of

gender and

ethnic representation

as required by the UK

Listing Rules is shown on page 77.

Further details can be found at

www.haleon.

com/who-we-are/leadership

Sir Dave Lewis (Chair) served as a member of the

Board from 23 May 2022 to 31 December 2025.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Our

Executive

Team

Keith Choy

President, Asia Pacific

Appointed: 16 December 2021

Line De Decker

Chief Human Resources Officer

Appointed: 1 August 2024

Claire Dickson

Chief Digital and Technology Officer

Appointed: 4 September 2024

Nathalie Gerschtein

President, North America

Appointed: 1 May 2025

Andrés González

President, Latin America

Appointed: 8 January 2026

Carl Haney

Chief R&D Officer

Appointed: 1 August 2025

Özlem Kaynak

President, Middle East & Africa

Appointed: 8 January 2026

Filippo Lanzi

Chief Growth Officer

Appointed: 16 December 2021

Appointed Chief Growth Officer: 8 January 2026

Kedar Lele

President, India Subcontinent

Appointed: 8 January 2026

Adrian Morris

General Counsel

Appointed: 12 August 2024

Namrata Patel

Chief Supply Chain Officer

Appointed: 6 November 2023

Ed Petter

Chief Corporate Affairs Officer

Appointed: 1 January 2024

Björn Timelin

Chief Transformation Officer

Appointed: 2 October 2023

Appointed Chief Transformation Officer: 8 January

2026

Jonathan Workman

President, Europe

Appointed: 8 January 2026

In addition to Brian McNamara

and Dawn Allen, the Executive

Team comprises:

Data as at the latest practicable date of 5 March 2026.

10 Men

6 Women

13 White

3 Asian/Asian British

6 British

1 Italian

1 Swedish

1 French

1 Chinese

2 American

Gender

Ethnicity

Nationality

Dual

(Belgian/

British)

1 Indian

1 Turkish

Dual

(Colombian/

Spanish)

The detailed breakdown of

gender and

ethnic representation

as required by the

UK Listing Rules is shown on page 77.

Further details can be found at

www.haleon.

com/who-we-are/leadership

Biographies for each of the Executive Committee

members can be found on our website at

www.haleon.com

Lisa Paley (President, North America) served as a

member of the Executive Team from 16 December 2021

to 1 May 2025.

Franck Riot (Chief R&D Officer) served as a member

of the Executive Team from 16 December 2021 to

31 August 2025.

Tamara Rogers (Chief Marketing Officer) served as a

member of the Executive Team from 16 December 2021

to 8 January 2026.

Haleon

Annual Report and Form 20-F 2025

Letter from

the Chair

Vindi Banga

Chair

I was honoured to assume the role

of Chair of the Board of Directors on

1 January 2026. Having served previously

as Senior Independent Director, I have

been able to build on my understanding

of the business, our culture and our

stakeholders as I transitioned into the

role. Over the early months of 2026,

I have met with colleagues, shareholders

and wider stakeholders, ensuring

continuity of leadership and alignment

around our strategic priorities.

On behalf of the Board, I would like to

thank Sir Dave Lewis for his leadership

and stewardship of Haleon since its

pages 65 to 68 and will be put to

shareholders for approval at the AGM

on 29 April 2026.

Governance

2025 represented our first full reporting

year against the UK Corporate

Governance Code 2024, and we are

pleased to report compliance with all

principles and provisions. The Board also

oversaw the update of our Code of

Conduct, reinforcing our commitment

to the highest standards of ethics,

transparency and regulatory compliance.

As a Board we have worked closely

with the Audit & Risk Committee in

preparation for reporting against

Provision 29 of the UK Corporate

Governance Code 2024 in next year’s

Annual Report and continue to embed

strong internal controls across the Group.

Succession planning and board

performance

Board refreshment remained a priority to

ensure the breadth and depth of skills

required for Haleon’s next phase of

growth. In 2025 we welcomed two new

Non Executive Directors – Bláthnaid

Bergin and Matt Shattock whose

financial, consumer and operational

expertise further strengthen the Board.

Alan Stewart was appointed Senior

Independent Director from 1 January

2026 following my transition to Chair.

We also continued to progress actions

following the 2024 external Board

performance evaluation, and succession

planning remains focused on maintaining

the appropriate skillset and high-

performing Board.

Stakeholder engagement

The Board undertook a wide programme

of engagement – including site visits,

global leadership sessions, employee

roundtables and ongoing dialogue

with investors and shareholders.

Regular, meaningful engagement

with stakeholders provides the

Board with important insight into

evolving expectations, enabling more

informed, balanced and accountable

decision making.

We look forward to the 2026 AGM on

29 April 2026, which will again be held

virtually to support broad and inclusive

participation reflecting our global

shareholder base.

Looking ahead

Looking ahead, the Board is fully

committed to supporting Haleon’s

ambition to reach one billion more

consumers by 2030 and to deliver

industry-leading shareholder returns.

Our priorities for 2026 include:

— Driving our growth, productivity and

culture change agenda, including

the implementation of our new

operating model.

— Supporting our value creation

framework through disciplined capital

allocation to deliver our ambition of

generating industry-leading

shareholder returns.

— Building our capabilities in innovation,

marketing, R&D, information, data

analytics and customer excellence

to that of a world-class consumer-

focused business.

— Maintaining strong corporate

governance and upholding robust

ethical standards.

The Board will work closely with Brian

and the leadership team to ensure

Haleon delivers the Win as One strategy.

listing in 2022. His contribution has

positioned Haleon strongly for the next

phase of evolution.

Board focus

During the year the Board concentrated

on the strategic, operational and

governance matters most critical to

Haleon’s long-term success. You can read

more about the Board’s activities on

page 65, key highlights include:

Strategy and Capital Markets Day:

oversaw the external launch of the Win

as One strategy, a significant milestone

in articulating our long-term ambitions

and our value creation framework.

Capital allocation and the Pfizer sell

down

: the Board considered the

implications of the March 2025 sell down

and continued to oversee the Group’s

capital allocation framework to support

sustainable returns.

Culture and workforce engagement:

part of our commitment to an inclusive,

values-led culture, the Board engaged

directly with colleagues across markets,

supporting the deeper workforce

insights outlined in Vivienne Cox’s report

on page 69.

Board visits and insight sessions:

visits

to our Nyon R&D and manufacturing site

and to the US market provided valuable

exposure to consumer, category and

innovation dynamics. These insights

continue to inform Board discussions

and decision making.

Remuneration Policy 2025

The Board reviewed and approved the

updated Remuneration Policy, ensuring

alignment with strategy, shareholder

expectations and evolving UK

governance standards. The updated

Remuneration Policy is outlined on

It is an honour and a privilege to have

taken on the role of Chair of the Board of

Directors of Haleon, from 1 January 2026.

On behalf of the Board, I would like to

thank Sir Dave Lewis for his leadership and

stewardship since listing. His contribution

has positioned Haleon strongly for the

next phase of its evolution.

Corporate

Governance

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Haleon

Annual Report and Form 20-F 2025

Governance

structure

At Haleon, we recognise

that a robust governance

framework is fundamental

to realising our purpose of

delivering better everyday

health with humanity and

executing our strategy

effectively.

Our governance structure is designed

to facilitate clear decision-making,

ensure accountability and provide

comprehensive oversight across the

Group. The Board maintains overall

responsibility for the direction and

control of Haleon, with specific day-to-

day management delegated to the Chief

Executive Officer, who is supported by

the Executive Team. To enhance its

effectiveness, the Board has established

several committees, each operating

under defined terms of reference

available on our website. These

committees work collaboratively to

address key areas of oversight. For

instance, the Audit & Risk Committee

maintains a close relationship with other

committees to ensure a holistic approach

to risk management, disclosures and

internal controls. This interconnected

governance framework enables Haleon

to maintain the agility required in the

dynamic consumer healthcare market

while upholding the highest standards of

corporate governance and stakeholder

accountability.

The Board

The Board’s main role is

to promote the long-term

sustainable success of the

Company, generating value

for shareholders and

contributing to wider society.

It sets the Company’s

purpose, values, strategy

and long-term objectives.

The Board is also responsible

for the Group’s system of

corporate governance, risk

management and financial

performance.

Audit & Risk Committee

Role of the Committee is to oversee the integrity of the financial reporting and audit process, and to oversee the

maintenance of sound internal controls and risk management systems. The Committee monitors the effectiveness of internal

and external audit and reviews concerns about financial fraud and whistleblowing.

See

page 70

Environmental & Social Sustainability Committee

Role of the Committee is to provide oversight and effective governance over progress with the environmental and social

sustainability agenda and the external governance and regulatory requirements relevant to these areas.

See

page 74

Nominations & Governance Committee

Role of the Committee is to lead the process for appointments to the Board and make recommendations to ensure plans

are in place for orderly succession to both the Board and senior management positions, and oversee a succession pipeline.

The Committee also has a role to ensure that the Company is managed to high standards of corporate governance.

See

page 76

Remuneration Committee

Role of the Committee is to set the broad structure for the Company’s Remuneration Policy and to determine the

remuneration of the Chair, the Executive Team and the Company Secretary. The Committee is also responsible for reviewing

workforce remuneration and the alignment of incentives and rewards with the Company’s culture.

See

page 78

The Chief Executive Officer (CEO) is responsible for:

—

Developing Haleon’s strategic direction for consideration by the Board.

—

Implementing the strategy and reporting on progress.

—

Day-to-day management of the Company, communicating expectations in relation to Company

culture and ensuring responsible business conduct across the business.

—

Providing effective leadership, coordination and performance management of the Executive Team.

The Executive Team is responsible for:

—

Supporting the CEO in the delivery of Haleon’s strategy.

—

Providing input into strategic and operational decisions aligned to

business priorities, and supporting on the delivery of actions.

—

Supporting the CEO in implementing decisions made by the Board.

Executive Team Forums

Sustainability & Risk

Finance

Innovation

Digital & Technology

Supply Chain

Human Resources

R&D

Director

Board

Audit & Risk

Committee

Nominations &

Governance

Committee

Remuneration

Committee

Environmental &

Social Sustainability

Committee

Chair and Executive Directors

Sir Dave Lewis

6/6

4/4

Brian McNamara

6/6

Dawn Allen

6/6

Independent Non-Executive Directors

Nancy Avila

6/6

Marie-Anne Aymerich

6/6

5/5

Vindi Banga

6/6

4/4

4/5

5/5

thnaid Bergin

6/6

2/2

Tracy Clarke

6/6

4/4

5/5

Dame Vivienne Cox

6/6

5/5

Asmita Dubey

6/6

Matthew Shattock

4/4

2/2

Alan Stewart

6/6

4/4

5/5

Matters reserved for the Board, Committees’ Terms of Reference, along with the Chair, CEO and SID’s role descriptions are

available at

www.haleon.com/who-we-are/Governance/board-and-board-committees

Board and Committee meetings

and attendance during 2025

Board papers are circulated to

all Directors in advance of the

meeting allowing sufficient time

for their consideration. If any

Director is unable to attend a

meeting, they can communicate their

opinions and comments on the

matters to be considered via the

Chair of the Board or the relevant

Committee Chair.

Following the conclusion of each

scheduled Board meeting, the Chair

holds a separate session with the

Non-Executive Directors.

Apologies in advance and comments shared

with the Committee Chair ahead of the

meeting.

Appointed to the Board on 24 February 2025

and appointed to the ARC on 30 July 2025.

Appointed to the Board on 1 June 2025 and

appointed to the ESS on 30 July 2025.

Haleon

Annual Report and Form 20-F 2025

Board

activities

Key areas of Board discussion

Item

Activity

Key outcomes/decisions

Group strategy

—

Reviewed the strategic and operational performance of the

business by brand, market categories and regions.

—

Reviewed investment and divestment opportunities.

—

Discussed the global economy, geopolitics and impact on

growth and performance.

—

Considered the global consumer and competitive landscape

and opportunities for innovation.

—

Reviewed a deep dive into innovation, and considered further areas of strategic growth at

the strategy offsite meeting.

—

Expressed its support for the evolution of the operating model.

—

Reviewed updates on the Wired for Excellence Programme.

—

Monitored the completion in Haleon’s acquisition of the remaining 12% shareholding in TSKF.

—

Received a deep dive on Haleon’s inorganic strategic framework, and the proposals for 2026.

—

Received a deep dive on Haleon’s Data & AI Transformation Programme.

—

Reviewed and approved revisions to external guidance.

Financials and

performance

—

Monitored Haleon’s financial performance and growth against

the 2024 financial plan and external commitments.

—

Considered the approach to capital allocation and returns.

—

Discussed financial performance against the 2025-2027 plan,

future outlook and analyst consensus.

—

Approved a £500m return of capital to shareholders through the share buyback

programme and an additional £150m consideration to fund the Company’s obligations

under its existing employee share plans.

—

Approved the quarterly, half-yearly and full-year results, and the 2024 Annual Report

and Accounts.

—

Approved the 2026-28 corporate plan and 2026 financial plan.

—

Approved the £1.75bn Revolving Credit Facility.

Risk

management

—

Discussed the Company’s system of risk management and

internal controls (alongside regular updates from the Audit &

Risk Committee).

—

Assessed the effectiveness of the Company’s risk and control

processes.

—

Reviewed the Company’s principal risks.

—

Approved the 2025 half year and full year Statement on Principal Risks for inclusion in the

2025 Interim Results, Preliminary Statements, and Report and Accounts.

—

Confirmed that the Company’s system of risk and control was operating effectively.

—

Confirmed the number and scope of principal risks remained appropriate.

—

Reviewed the annual update on subsidiary governance.

People, culture

and values

—

Reviewed the results from the 2025 employee engagement survey.

—

Reviewed proposals to enhance the Group operating model

for delivery of Win as One.

—

Received regular updates from the Board’s Workforce

Engagement Director.

—

Endorsed the 2025 employee engagement focus areas.

—

Considered updates to Haleon’s approach to Diversity, Equity and Inclusion, and approved

recommended updates to the Board Inclusion Policy.

—

Received and approved its support for the evolution of the operating model.

—

Approved updates to the Group Code of Conduct.

Governance

—

Considered reports from the Chairs of each Board Committee

on key areas of Committee discussion and focus.

—

Reviewed progress made against the 2025 Board performance

action plans.

—

Engaged in the 2025 internal Board performance review.

—

Received and discussed regular updates on key governance

and disclosure matters.

—

Reviewed external board appointments and conflicts of

interest.

Following recommendation from the Nominations & Governance Committee:

—

Approved the appointments of Vindi Banga as Board Chair and Alan Stewart as Senior

Independent Director.

—

Approved the appointments of Matthew Shattock and Bláthnaid Bergin as Independent

Non-Executive Directors.

—

Approved the 2026 Board and Committee action plans following the Board performance

review.

—

Approved changes to various governance policies to enhance alignment with Haleon’s

operating model.

Shareholder

and

engagement

—

Reviewed the preparations for the 2025 AGM and the digital

focus.

—

Considered updates from Investor Relations, including share

price and valuation analysis, market engagement and

ownership analysis, and the views of institutional investors.

—

Approved the Notice of 2025 AGM.

—

Approved the 2024 final dividend of 4.6p, the 2025 interim dividend of 2.2p and the

proposed 2025 final dividend of 4.9p.

—

Noted Pfizer’s sell-down and complete exit as a Haleon shareholder.

—

Reviewed and provided feedback on the materials for Capital Markets Day.

—

The Board took part in ‘Growing at Haleon’ week, focused on employee growth and

development.

Sustainability

—

Considered Haleon’s health inclusivity and sustainability

agenda and progress plan against the responsible business

scorecard measures, including for climate and nature.

—

Reviewed the risks and opportunities, plus areas for further innovation to support delivery.

—

Approved the Responsible Business Report 2024 and 2025 Human Rights Statement.

—

Endorsed the refreshed Health Inclusivity and Sustainability strategic framework.

—

Reviewed the results of our Double Materiality Assessment in preparation for potential

future CSRD reporting.

See also our

key stakeholders

and

culture and people

sections on pages 32–34 and 35–39

Key focus areas during the year

Throughout the year, the Board

maintained strong oversight of the

Company’s strategic direction,

operational performance and

governance responsibilities, whilst

ensuring the interests of stakeholders

were considered in decision making.

From shaping the Company’s long-term

strategy to overseeing critical portfolio

management decisions and capital

allocation, the Board’s engagement

was broad while remaining responsive

to changing external economic and

political dynamics. The table on the right

highlights the Board’s key areas of focus,

summarising significant decisions and

discussions. They also reflect the Board’s

dedication to fostering sustainable

growth, enhancing operational efficiency

and the relevant factors considered

within the context of Section 172(1)(a)

to (f) of the Companies Act 2006

(Section 172). Further detail on the

Board’s Section 172 considerations are

available on page 31.

Relevant Section 172 factors

Long term

Employees

Business relationships

Community and environment

Business conduct

Members of the Company

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Innovation

During the year, the Board undertook a comprehensive review

of the Company’s innovation strategy and pipelines across its

key categories, as part of its ongoing commitment to effective

governance and strategic oversight. The Board considered the

progress in strengthening the Company’s innovation,

developing and scaling initiatives, and ensuring alignment with

long-term objectives. Attention was given to the supporting

frameworks and processes to guide innovation activities,

including the introduction of new principles and metrics to

enhance effectiveness and impact.

The Board’s review covered the development of innovation

pipelines in the Company’s six major categories – Oral Health,

Vitamins, Minerals & Supplements (VMS), Pain Relief,

Respiratory Health, Digestive Health, and Therapeutic Skin

Health & Other. Progress was noted in building and scaling

innovation initiatives, with a focus on identifying strengths

and opportunities for improvement. The Board encouraged

disciplined assessment and prioritisation of resources,

ensuring that innovation efforts are directed towards areas

of greatest strategic importance.

Regular oversight was maintained throughout the year,

with the Board monitoring pipeline development and the

implementation of innovation strategies, to ensure that

innovation activities remain consistent with the Company’s

values and ambitions, and that governance standards are

upheld across all categories.

Spotlight

Board activities

continued

Strategic review

During the year, the Board held a

dedicated two-day strategy offsite,

receiving presentations from

management and reviewing the Group’s

strategic plans. The sessions provided

an opportunity for in-depth discussion

on Haleon’s strategic priorities and

long-term ambitions, including growth

acceleration, portfolio evolution,

digital transformation and operational

resilience.

The Board reaffirmed its commitment to

Haleon’s ambition to deliver sustainable

organic sales growth and industry-

leading shareholder returns. It explored

opportunities to strengthen execution

across priority areas such as category

leadership, innovation, digital commerce

and supply chain excellence. The Board

also considered how Haleon’s brands

could expand their reach and relevance,

and discussed the potential for targeted

investments and partnerships to support

growth in key markets.

In addition, the Board reviewed progress

on transformation initiatives, including

digital strategy and technology

programmes, and emphasised the

importance of robust governance

and readiness for upcoming system

migrations. The Board also discussed

the sequencing of major programmes

to ensure alignment with Haleon’s

operating model and capacity to deliver.

The Board will continue to monitor

progress against these priorities and

maintain a forward-looking agenda to

support Haleon’s strategic objectives

and long-term value creation.

Culture

The Board maintained a strong focus on

culture throughout the year, recognising

its importance in supporting Haleon’s

strategy, performance and long-term

ambitions.

The Board monitors culture in several

ways, including via the:

— Annual employee engagement survey

and interim pulse survey.

— Annual Board performance review.

— Board Inclusion Policy.

— Employee listening sessions with the

Workforce Engagement Director.

— Board and Executive Team market

visits.

— Executive Team employee town halls.

The Board received regular reports

on workforce engagement, including

feedback from engagement sessions

with colleagues at all levels and the

results of the annual and pulse

engagement surveys. These insights

enabled the Board to monitor employee

sentiment, collaboration, and areas for

improvement, such as work processes

and digital tools. Our 2025 annual

employee engagement survey provided

valuable insights into our cultural

progress. The results showed the

strongest areas continued to be safety,

consumer understanding, and ethical

business decision-making and conduct.

It was identified that there was still more

work to do to improve our work

processes, collaboration and

career development opportunities.

The Board also oversaw the evolution

of Haleon’s operating model and

organisational structure, recognising

the need for clear accountabilities,

streamlined decision-making, and the

development of global leadership

capabilities. The Board supported

initiatives to reinforce a consumer-centric

mindset, foster collaboration, and build

the skills and capabilities required for

future growth.

In addition, the Board reviewed

progress on inclusion and belonging

(I&B), including the impact of external

developments on I&B policies.

The Board endorsed management’s

approach to maintaining an inclusive

culture and adapting policies as

needed in response to the evolving

external landscape.

Through these activities, the Board

ensured that culture remained central to

Haleon’s purpose and strategy, and that

the organisation is well positioned to

deliver sustainable performance and

long-term value for stakeholders.

Board training, development and

performance

The Board actively supports Haleon’s

culture of continuous development,

with Directors demonstrating this

through their own professional growth.

During 2025, the Board maintained

a comprehensive development

programme, which was regularly

reviewed and updated to reflect both

Company-specific needs and broader

market developments.

Directors participated in training sessions

covering core governance areas and

completion of the updated Code of

Conduct training. Strategic briefings kept

the Board informed of key business

developments, while regular governance

updates covered important regulatory

changes, and evolving requirements in

governance and sustainability reporting.

Haleon

Annual Report and Form 20-F 2025

Inorganic strategy

During the year, the Board considered the Company’s approach

to inorganic growth as part of its broader strategic planning.

The Board established guiding principles for evaluating

potential opportunities, ensuring that any future acquisitions

or partnerships would support the Company’s long-term

objectives and complement its existing strengths. Attention

was given to identifying areas where inorganic activity could

help address gaps or accelerate progress in priority markets

and categories. The Board maintained regular oversight of the

process, with a focus on disciplined assessment and alignment

with Haleon’s overall strategy. This approach is designed to

ensure that any inorganic initiatives undertaken are consistent

with the Company’s values and ambitions. The Board will

continue to monitor developments and review progress as

part of its ongoing commitment to effective oversight and

strategic direction.

Nyon visit

The Board visited the Company’s manufacturing site in Nyon,

Switzerland in June 2025. During the visit, the Board received

insight into the European Consumer Health market, Haleon’s

position and portfolio reach in the region, and the year-to-date

European business performance. The Board also reviewed the

three year Europe ambition across each category, considered

the key strategic drivers, and received insight into the

European regulatory and policy environment. The visit included

deep dive sessions on Respiratory Health and Pain Relief,

covering strategic focus areas and related action plans, and

potential European inorganic opportunities. Following a

session on Haleon’s Global Quality and Supply Chain strategy,

the Board gained first hand experience of the site operations.

These visits provide the Board with the opportunity to engage

with employees at the local Haleon office as well as the

manufacturing site.

Spotlight

Board performance review

In line with best practice, the

performance and effectiveness of the

Board, its committees and individual

Directors are assessed annually. In 2024,

Haleon undertook an externally

facilitated evaluation led by Chris Saul

of Chris Saul Associates. The Board

reviewed progress against each action

from the 2024 performance review

and determined that progress had been

made against all actions regularly

throughout the year (as set out on

page 68).

For 2025, the Board performance review

was internally facilitated by the Company

Secretary using a question and

discussion-based evaluation process.

Other regular meeting attendees were

also requested to provide feedback.

Key findings and conclusion

In summary, feedback on the Board’s

composition, interactions. expertise and

operational effectiveness (including

agendas and papers) was consistently

positive and all management interactions

were rated highly. A number of focus

areas for the Board and its Committees

were highlighted for 2026 and these are

set out on page 68.

2027

External evaluation

2026

Internally facilitated

2025

Internally facilitated

The internal Board performance review process

2026 action plan

agreed

Internally facilitated

performance review

process agreed

Questionnaire sent

to all Board and

Committee members

One-to-one

meetings with the

Company Secretary

and Board Directors

as required

Feedback reviewed

and responses

analysed and

presented to the

Nominations &

Governance

Committee

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Board activities

continued

2025 Board performance review action plan

2025 action plan

Actions taken/outcomes

Continue focus on strategic agenda and delivery of key

objectives, driving performance and shareholder returns.

The Board received regular updates on delivery against strategy, inorganic strategy framework

as well as a deep dive on innovation. Strategy discussions also took place at the Board strategy

offsite.

Broaden discussion around stakeholders as well as external

horizon scanning and discussion on geopolitical and macro

issues, AI and the evolving ESG agenda.

The Board considered the external environment and geopolitical issues as part of its regular

review of strategy and performance. The Board also received regular updates on the Data,

Analytics and AI transformation programme.

Advance progress on cultural evolution and interactions with

key talent and business areas.

The Board reviewed the Group’s operating model and proposals to enhance, including the

impact on culture.

Enhance market visits in key locations.

The Board undertook a manufacturing site visit to Nyon, and the December Board meeting was

held in North America.

2026 action plan

The strategic agenda and value creation framework delivery in relation to key

objectives, performance and shareholder returns.

Cultural evolution to support the operating model.

Category deep dives, customer insights and drivers.

Technology and Enterprise Transformation.

Cybersecurity and AI risks and opportunities.

North America

In December 2025, the Board met

in North America to review progress

over the past three years, reflect on

recent performance, and agree the

strategic direction for the period

ahead. As part of the visit, the Board

received an in-depth briefing on brand

development and the Company’s

forward-looking vision for North

America. The Board also discussed the

key workstreams underway to support

the next phase of the Group’s growth

plans in the market, including those

focused on strengthening the cultural

and leadership capabilities required

to deliver the strategy effectively.

In addition, the visit provided an

opportunity for the Board to engage

informally with members of the wider

US leadership team, helping US

colleagues to learn more about the

Board and for the Board to deepen

its insight into regional priorities

and organisational culture.

Spotlight

Haleon

Annual Report and Form 20-F 2025

Workforce engagement

Dame Vivienne Cox

Workforce Engagement Director

This year I have enjoyed some excellent

opportunities to engage with employees

across different parts of Haleon globally.

These have been both insightful and

informative.

The sessions have covered: the

employee engagement survey results

and key themes for focus in 2025; a

face-to-face session with early talent

and graduates on career development

and growth at Haleon; a deep dive into

work process across the organisation;

and two sessions exploring how close

Haleon colleagues feel to consumers

annual employee engagement survey,

which identified the need to improve and

streamline work processes, to provide

opportunities for career growth, and the

importance of keeping consumers at the

heart of our work. During 2025, I met

with employees on five occasions,

including a face-to-face session in the

UK. It was important to ensure these

sessions included a cross-business group

of culturally diverse employees from

across our key markets and functions.

Amongst other matters, the sessions

explored:

— The 2024 employee engagement

survey results with managers across

EMEA and LatAm.

— A face-to-face session with UK-based

early talent and graduates on career

development and growth.

— Work processes with colleagues from

global functions.

— Two ‘consumer first, always’ sessions

with APAC and EMEA respectively to

explore how we can leverage good

practice internally to continue to drive

this as our focus.

These sessions offered valuable insight

into drivers of employee engagement at

Haleon. The discussions highlighted the

progress made to improve collaboration

across Haleon, the opportunities AI

presents with regards to streamlining

work processes, and the importance of

continuing to anticipate consumer needs

and trends. Key points raised included

streamlining and simplifying systems and

processes for greater agility, ensuring

that the voice of the consumer comes

through in decision making across the

business and unifying the organisation

through fostering an agile and

performance-focused culture. At each

meeting I gave an overview of the role

of Haleon’s Board as well as the

remuneration approach at Haleon,

setting out how the Remuneration

Committee operates and how it

considers wider workforce remuneration

arrangements. I provided regular

updates to the Board following these

sessions, which were valuable to

Board discussions during the year.

Continued engagement

In addition to my activities, direct

engagement with employees remains

extremely valuable for the wider Board,

who had the opportunity to meet with

employees during the Board’s visits to

Switzerland and United States. These

visits provide additional opportunities

to informally network with employees

and further understand culture.

The Board receives regular verbal

updates from management, which will

continue to form an important part of

the Board’s agenda for 2026, alongside

updates on employee engagement

survey results and detailed summaries

at the end of each financial year.

See also the

consideration of workforce

pay

and

approach to engagement

page 100.

and how we can build on progress made

in this area in the future.

Looking ahead to 2026, I will be

seeking to engage on a number of topics,

including: exploring the annual employee

engagement survey results from 2025

with a focus on driving forward

enterprise wide actions; considering how

we can simplify and refine our work

processes to better set Haleon up for

success; and how we can continue to

drive culture transformation across

the organisation.

Workforce engagement

In line with Provision 5 of the UK

Corporate Governance Code 2024,

the Board regularly assesses the

appropriateness of the mechanism for

workforce engagement. The Board

believes that the mechanism of a

designated Non-Executive Director

remains the most effective method for

Haleon to enable the employee voice

to be heard and for key insights to be

brought into the Boardroom.

Employee insight

The Board values the opportunity to

connect and engage with employees.

Understanding the key issues that matter

to our employees across Haleon’s

diverse markets and regions is essential.

By learning about their experiences

working at Haleon and identifying any

challenges they face, we gain valuable

insights into the Company’s culture.

Keeping a close watch on employee

engagement helps us assess the current

and future factors that drive attraction

and retention at Haleon.

Engagement plan

In preparing the workforce engagement

plan for 2025, the key drivers of

engagement originated from the 2024

“The Board values the opportunity to

connect and engage with employees.”

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Key duties and responsibilities

The Committee’s responsibilities include

monitoring and reviewing:

—

The integrity of financial reporting of the

Company’s Financial Statements including

reviewing significant judgements and the

adequacy of related disclosures.

—

The external and internal audit process and

performance of the Internal Audit function

and the external auditor.

—

The effectiveness of the Company’s system

of internal control.

—

The process for the management of related-

party transactions.

—

The Group’s risk management system, and

the identification and management of risks.

—

The Company’s process for monitoring

compliance with legal and regulatory

requirements and ethical codes of practice.

Membership and meetings

The Committee comprises solely of

Independent Non-Executive Directors.

Details are set out on pages 60 and 61,

together with details of their attendance for

the year on page 64.

The Chair, CEO, CFO, General Counsel, Group

Controller, Head of Audit & Risk, and the lead

external audit partner from KPMG LLP (KPMG)

regularly attend meetings, with other

attendees invited as appropriate. The

Committee also met without management

present and met privately with the external

audit partner and with the Head of Audit

& Risk.

The Board has confirmed that it is satisfied:

—

That the Committee members collectively

possess an appropriate breadth of recent

and relevant financial expertise including

competence in accounting and/or audit and

experience in the consumer healthcare

industry.

—

That Alan Stewart possesses the relevant

attributes to be the designated Audit

Committee Financial Expert in accordance

with US federal securities laws and

regulations.

Looking ahead

The Committee will continue to focus on its

key areas of responsibility, including the

Group’s financial reporting and disclosures,

internal control over financial reporting, the

effectiveness of KPMG as external auditor

and the approach to the 2026 external audit.

Controls surrounding the IT environment,

including cyber security, will remain a key

area of focus for the Committee as well as

regular oversight of the Group’s principal risks.

The Committee will continue to receive regular

updates and review relevant disclosures in

relation to Haleon’s transition to IFRS 18.

Alan Stewart

Chair

As Chair of the Audit & Risk Committee, I am pleased to

present the Committee’s Report for the period ended

31 December 2025 in accordance with the updated UK

Corporate Governance Code.

During the year, the Committee has focused on its core

objectives in monitoring the integrity of the Group’s

financial reporting process, the effectiveness of the

external audit and the robustness of the Company’s

control environment to manage risk. The Committee

maintained oversight of Haleon’s compliance with Section

404 of the US Sarbanes-Oxley Act (SOX) and broadened

our understanding of our principal risks through a series

of deep dives into topics such as cyber security, ESG,

and Trusted Ingredients. Further information on this

and our other activities are set out later in this report.

The Board and Committee performance review concluded

that the Committee operates effectively. The specific

actions for the Committee are provided later in this report

and will be an additional area of focus for the Committee

in 2026.

Audit & Risk

Committee Report

Significant reporting matters in relation to the Financial Statements

considered by the Committee during 2025

Accounting area

Recoverable amount of indefinite life brands

Committee’s conclusion and response

—

As at 31 December 2025, the Group had

£16,594m of intangible assets that are

indefinite life brands. The Group tests at

least annually whether indefinite life

brands have suffered any impairment.

Impairment testing is inherently

judgemental and requires management

to make multiple estimates, including

those related to the future revenue

growth of each brand, terminal growth

rates, profit margins and discount rates.

The Committee reviewed information on

the impairment tests performed, focusing

on the critical assumptions as well as any

changes from the prior year.

—

During the year, Nexium was reclassified

from an indefinite life brand to a definite

life, amortised brand due to challenging

market conditions. An impairment

assessment was performed prior to

reclassification, with no impairment

recognised.

—

In 2025, the Group recognised non-cash

net impairment charges totalling £7m in

relation to indefinite life brands for which

it was determined that the carrying value

was less than the estimated recoverable

amount. This was primarily a result of a

decline in sales and volumes for smaller

brands. For the brands with limited levels

of headroom, the Committee also

reviewed and challenged sensitivity

analyses provided by management to

understand the impact of changes in

key assumptions. The Committee was

satisfied with the assumptions utilised

by management and also considered

and reviewed the Group’s relevant

impairment disclosures. Refer to Note 14

of the Consolidated Financial Statements

for further detail.

This accounting standard is applicable

for periods starting 1 January 2027 and

comparative information is required to be

restated. In line with the announcement made

on 8 January 2026, the Committee will also

review the proposed updates to segmental

reporting disclosures and ensure compliance

with IFRS 8.

In addition, the Committee will support the

Board on the preparation for compliance

with new Provision 29 of the UK Corporate

Governance Code which takes effect in 2026

and the further development of the Group’s

enterprise risk management framework and

compliance programmes.

Haleon

Annual Report and Form 20-F 2025

Committee activities

External reporting

—

Discussed and recommended to the Board for

approval, the quarterly trading statements, half-year

and full-year financial statements, and the 2025

Annual Report and Form 20-F.

—

Considered the level of distributable reserves to

support the Board approval of the 2024 and 2025

dividends.

—

Reviewed the disclosures regarding the updated

market category structure to incorporate six

categories for the first time at the half-year 2025.

—

Reviewed and challenged the going concern

assumptions for 2025 and the principles

underpinning the longer-term viability statement.

—

Reviewed and challenged the treatment of key

accounting matters and judgements including the

estimation of the recoverable amount of indefinite

life brands.

—

Reviewed and approved the 2025 tax strategy for

publication.

—

Reviewed and recommended the 2026 funding

requirements to the Board for approval.

—

Considered treasury matters and compliance with

statutory reporting obligations.

—

Assessed whether the Annual Report, as a whole,

was fair, balanced and understandable.

External and internal audit

—

Reviewed and approved the statutory audit

engagement letter for KPMG in respect of Haleon plc

and its subsidiaries for the period ended 31 December

2025 and received regular updates on delivery of the

external audit for 2025.

—

Reviewed and approved the 2025 base audit fee.

—

Held periodic meetings with the external auditor,

without management present.

—

Reviewed and agreed policies and processes designed

to safeguard independence of the external auditor.

—

Reviewed and approved the non-audit services to be

performed by the external auditor, in line with the

Non-Audit Service Policy.

—

Assessed the effectiveness of the external auditor.

—

Reviewed and approved the 2026 Internal

Audit budget and plan.

—

Reviewed and approved the Internal Audit Charter.

—

Received and discussed regular updates on the 2025

Internal Audit Plan from the Head of Audit & Risk and

met with him regularly without management present.

Internal controls and related-party transactions

—

Received and discussed regular updates on internal

controls, including the results of testing, and discussed

instances where the effectiveness of internal controls

was considered to be insufficient or required remediation.

—

Considered the assessment to determine the Company’s

status as a Foreign Private Issuer for US SEC purposes

including updates on the SEC's consultation.

—

Reviewed the Group’s SOX evaluation and certification

of internal controls over financial reporting for the year

ended 31 December 2025.

—

Reviewed related parties as part of the year-end process.

Risk management

—

On behalf of the Board, reviewed the processes by

which the Group’s principal risks are identified and

managed and received periodic reports of the status of

principal risks; reported any issues arising from these

reports to the Board.

—

Undertook detailed reviews of key risk areas and

processes including Currency Risk, ESG, People and

Organisation, Technology Concentration Risk, trusted

ingredients, product user safety, and cyber security.

—

Considered enhancements to Haleon’s Resilience

Framework and simplification of the Crisis Management

and Business Continuity Policy and process.

—

Reviewed tax and treasury policies and considered

consistency with the risk appetite of the Company.

—

Reviewed the effectiveness of the risk management

and internal control systems.

—

Recommended to the Board the Group’s set of material

controls, effectiveness criteria and adequacy of

assurance coverage to satisfy the requirements of

Provision 29 of the UK Corporate Governance Code.

Legal and Compliance

—

Received and discussed regular updates from the Legal

function on legal and litigation matters.

—

Monitored fraud reporting and discussed trends with

management.

—

Recommended to the Board approval of the updated

Code of Conduct.

—

Considered updates on the implementation of the new

Ethics & Compliance model.

—

Reviewed and discussed reports from the Compliance

function, including updates on Haleon’s Anti-Bribery

and Corruption programme, enhancements to the Code

of Conduct training, Speak Up sanctions, concerns

management and internal investigation’s framework.

Haleon’s Annual Report for the year ended

31 December 2024 was included in the FRC’s

thematic review: Supplier finance

arrangement disclosures. The FRC carried out

a limited scope review of Haleon’s relevant

disclosures and no significant questions or

queries were raised. The Committee notes

that the FRC’s review does not provide

assurance that the Annual Report is correct

in all material respects as the FRC’s role is

not to verify information provided, but to

consider compliance with reporting

requirements.

Internal audit

The Internal Audit function continues to serve

as a vital source of independent and objective

assurance to the Board, the Committee and

senior management. Its remit includes

evaluating the adequacy and effectiveness of

Haleon’s risk management, governance and

internal control frameworks.

The appointment of the Head of Audit & Risk

remains a matter reserved for the Committee.

In December 2025 the Head of Audit & Risk

stepped down, an interim appointment was

made with the support of the Audit & Risk

Committee. The Committee Chair will be

involved in the selection process for the

permanent appointment of a new Head of

Audit & Risk and a recommendation for

appointment made to the Committee.

During the year the Head of Audit & Risk

maintained regular dialogue with the

Committee Chair and provided formal updates

on Internal Audit activities at each meeting.

Over the course of 2025, the Committee

closely monitored the performance and

effectiveness of the Internal Audit function,

including its quality, depth of expertise and

resourcing in the context of Haleon’s scale

and complexity. Reports submitted to the

Committee set out key audit findings and

recommended actions, with clear timelines

for management response and remediation.

Financial and narrative reporting

Throughout 2025, the Committee maintained a

strong focus on the integrity and transparency

of Haleon’s financial reporting. It reviewed

and recommended for Board approval both

the interim and full-year financial statements,

alongside associated public disclosures.

Particular attention was given to areas

involving significant judgement, including

assessments of going concern and viability,

as well as impairment reviews.

In evaluating the Annual Report, the

Committee considered whether it presented

a fair, balanced and understandable account

of the Group’s performance, business model

and strategy. To support this, management

implemented robust processes to ensure

consistency of disclosures, mitigate financial

reporting risks and facilitate coordinated

input across the business. Following its review,

the Committee recommended a near-final

version of the Annual Report to the Board at

its February 2026 meeting, confirming its

view that the report was fair, balanced,

and understandable.

During the year, the Committee also reviewed

key disclosures and reporting obligations to

ensure the clear and accurate communication

of material information to shareholders. This

included scrutiny of assumptions underpinning

impairment testing, and the treatment of going

concern and viability assessments, as well as

climate-related financial disclosures.

The Committee received regular updates

on the control environment and financial

reporting integrity, including the Annual Report

verification process. This encompassed

management’s checklist confirming

compliance with applicable regulatory

requirements and the outcomes of the

external audit. Key audit matters and related

findings are detailed in the external auditor’s

report on pages 106 to 120.

In addition, the Committee continued

to monitor engagement with external

stakeholders relevant to its remit, including the

UK Financial Reporting Council (FRC) and the

US Securities and Exchange Commission (SEC).

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Audit & Risk Committee Report

continued

Governance Code for the year ended

31 December 2025 and up to 5 March 2026,

the last practicable date.

US Sarbanes-Oxley Act of 2002 (SOX)

As a Foreign Private Issuer listed on a

US exchange, Haleon is subject to the

provisions of the Sarbanes-Oxley Act of 2002,

specifically Sections 302 and 404. During

2025, the Group successfully completed its

third consecutive year of compliance with

Section 404.

The Committee maintained close oversight

of the Group’s internal control over financial

reporting, which was assessed to be

appropriately designed and operating

effectively as at 31 December 2025.

Throughout the year, the Committee received

regular updates on the status of SOX

compliance and closely monitored the

remediation of any identified control

deficiencies. This included reviewing the root

causes, the remediation actions undertaken,

and the adequacy of any mitigating or

alternative controls implemented.

Looking ahead, the Committee will continue

to oversee the Group’s internal control

optimisation efforts, including the remediation

of control deficiencies and enhancements to

controls associated with technology systems

and infrastructure.

See also our

management’s report on

internal control over financial reporting

on page 180.

External audit

The Committee retains primary responsibility

for overseeing the relationship with the

external auditor, KPMG. This includes making

recommendations to the Board regarding the

appointment, reappointment and removal

of the external auditor, assessing its

independence on an ongoing basis, and

approving the statutory audit fee, scope of

the audit and the appointment of the lead

audit engagement partner. For the year

ended 31 December 2025, the lead external

audit partner rotated to Jeremy Hall.

significant risks and uncertainties. As such, the

internal control system is intended to provide

reasonable, though not absolute, assurance

over the management of principal risks.

A top-down enterprise risk assessment

was conducted during the year to review

and prioritise principal risks, assess the

magnitude of exposure and identify

emerging risks. This was complemented by a

bottom-up risk identification exercise across

business units, markets, sites and functions.

The Committee reviewed the findings,

endorsed the principal risks and concluded

that management’s approach to risk and risk

appetite remained appropriate.

See also our

approach to risk

section

from page 50.

The Committee maintained regular oversight

of the Group’s Ethics & Compliance

programme and Speak-Up activities. This

included monitoring efforts to consolidate and

simplify key controls, and reviewing assurance

and performance against key compliance

metrics. Areas covered included anti-bribery,

conflicts of interest, competition law, privacy

and sanctions.

In addition, the Committee reviewed and

endorsed a number of policies and

programmes, including the Company’s Code of

Conduct and its core value of always seeking

to do the right thing. This applies to the Board,

Executive Team, employees and third-party

temporary workers. The Committee also

reviewed the annual certification process,

whereby business unit and segment general

managers and finance directors attest to the

integrity of financial information and the

effectiveness of internal controls over financial

reporting and disclosure. Opportunities to

simplify and evolve the internal control

framework in line with Haleon’s strategy

and operating model were also discussed.

Based on the Committee’s activities

throughout the year and its annual

performance review, the Committee

concluded that the Group’s system of internal

control and risk management was effective

under the provisions of the UK Corporate

During the year, the Committee reviewed and

discussed the external audit plan, proposed

audit fees and terms of engagement. It also

considered enhancements to the audit

process, including the increased use of digital

tools and technology.

The Committee received regular reports from

KPMG on the progress of audit activities.

These reports were reviewed in detail,

with particular attention given to the level

of professional scepticism applied, the

robustness of challenge to management

assumptions, and the quality of insights from

the external auditor. Where appropriate,

the Committee requested management to

respond to auditor challenges and monitored

the resolution of these matters to ensure

satisfactory outcomes.

In assessing KPMG’s independence, the

Committee reviewed a formal statement of

independence, a report outlining procedures

for identifying and managing conflicts of

interest, and the extent of non-audit services

provided to the Group. The Committee

confirmed its satisfaction with the

effectiveness and independence of KPMG

across its engagements in relevant jurisdictions.

The Committee also evaluated the

effectiveness of the external audit process,

considering the quality and experience of the

audit team, the involvement of the lead audit

partner, the adequacy of audit planning,

the timeliness and rigour of audit execution,

and the quality of communications with

the Committee. It concluded that the 2025

external audit was effective and that

KPMG continued to perform its role to a

high standard.

Total fees paid to KPMG for the year ended

31 December 2025 were £18m, of which £1m

related to non-audit services. Further details

are provided in Note 6 to the Consolidated

Financial Statements on page 133.

The Committee reviewed and approved the

annual Internal Audit budget and work plan,

which encompassed risk-based reviews

across financial, operational, strategic and

governance domains. Assurance was also

provided over emerging risks and significant

business change programmes. The 2026

Internal Audit plan will be subject to ongoing

review and refinement to ensure it remains

responsive to evolving risk and assurance

priorities.

Internal control and risk management

The Board retains ultimate responsibility for

establishing and maintaining procedures to

manage risk and oversee the Group’s internal

control framework. This includes setting the

Group’s risk appetite in line with strategic

objectives and ensuring appropriate oversight

through mechanisms such as strategy sessions,

management reporting and targeted reviews

of key risk areas.

Acting on behalf of the Board, the Audit & Risk

Committee is responsible for reviewing and

assessing the effectiveness of the Group’s risk

management and internal control systems.

During 2025, the Committee undertook

a comprehensive review of the Group’s

principal risks, financial and operational

controls, and supporting procedures. This

included evaluating risk mitigation plans,

internal control maturity and areas identified

for improvement. The Committee also

conducted deep dives into selected principal

risks, including People & Organisation, ESG,

and trusted ingredients.

The Group’s approach to risk management

and internal controls continued to evolve in

2025 in preparation for compliance with the

revised UK Corporate Governance Code.

The Committee considered Haleon’s risk

management framework, material controls,

effectiveness criteria, adequacy of assurance

coverage required to satisfy the new

requirements under Provision 29 of the Code,

and timeline to finalise the Board’s attestation

and approach to assessing the effectiveness

of material controls for 2026. The risk

management framework is designed to

actively manage, rather than eliminate,

Haleon

Annual Report and Form 20-F 2025

Principal risks

People and Organisation:

The Committee undertook

a focused review of the principal risk relating to

People and Organisation. The Committee considered

the effectiveness of controls and management actions

in areas such as talent attraction and retention, health

and wellbeing, inclusion and belonging, operating

model, capabilities, and culture. The Committee noted

the addition of new risk areas reflecting the evolving

needs of the business and reviewed progress against

key risk indicators, including employee engagement,

wellbeing, and diversity. The Committee was satisfied

that robust oversight, clear accountability, and

continuous improvement measures are in place

to manage these risks and support the Group’s

strategic objectives.

ESG:

Given the increasing importance of responsible

practices and evolving regulatory requirements, the

Committee maintained close oversight of ESG risk.

The Committee considered the effectiveness of

controls and management actions in key areas,

including human rights due diligence, climate-related

risks, readiness for rising ESG reporting requirements,

diverging global regulations, and delivery against

external ESG commitments. The Committee noted

progress in reducing carbon emissions and virgin

plastic use, improvements in ESG data and controls,

and enhanced governance processes. Performance

against key risk indicators was closely monitored,

and the Committee ensured that additional actions

were identified where needed, such as piloting

robust supplier audits and strengthening

reporting frameworks.

Trusted Ingredients:

During the year, the Committee

reviewed the Group’s management of ingredient-

related risks through the Trusted Ingredients

Framework. The Committee noted ongoing progress in

risk mitigation, including the development of proactive

dashboards, enhanced governance, and the use

of scorecards to monitor business value at risk,

consumer sentiment, and market share. The Committee

considered key ingredient risks identified and the

potential regulatory, reputational and financial impacts.

These included reformulation initiatives, advocacy with

regulators, partnerships with scientific associations,

and the development of alternative ingredients and

packaging solutions. The Committee will continue

to monitor the evolution of the Trusted Ingredients

Framework to ensure the Group remains well

positioned to respond to emerging ingredient risks

and regulatory developments.

Cyber Security:

This remained a key area of focus for

the Committee during 2025. The Committee oversaw

performance against key operational metrics and

monitored the launch and roll-out of Haleon’s security

culture programme, which included a Group-wide

awareness campaign and enhanced security training.

These initiatives are designed to foster a positive

culture of security and equip colleagues with the

skills and awareness needed to manage evolving

cyber threats.

The Committee received regular updates on the

progress of the security culture programme, including

delivery of the 12-month roadmap and achievement

of key milestones. The Committee also reviewed the

Group’s technology environment, considering

infrastructure resilience and mitigation plans for

potential vulnerabilities.

In addition, the Committee reviewed the Group’s

approach to supply chain resilience, with a particular

focus on cyber security within supplier contracts.

A programme is underway to review and update key

supplier agreements to ensure they reflect current

best practice, supported by targeted assessments and

ongoing improvements to contract management and

supplier engagement. The Committee is satisfied that

these actions are strengthening the Group’s supply

chain resilience and supporting the continued security

and reliability of operations.

The Committee also considered the Group’s reliance

on key technology providers and platforms. Robust

business continuity and crisis management plans are in

place to address potential disruptions, and ongoing

monitoring and resilience measures help ensure the

continued reliability of the Group’s technology

environment.

The Committee confirms that Haleon has

complied with the Competition and Markets

Authority’s Statutory Audit Services for Large

Companies Market Investigation (Mandatory

Use of Competitive Tender Processes and

Audit Committee Responsibilities) Order 2014,

as well as the FRC’s Audit Committees and

the External Audit: Minimum Standard.

Committee performance review

As part of the Board and Committee

performance review, the Committee was

assessed to be operating effectively.

The Committee progressed all the key areas

of focus from the 2025 performance review.

A number of areas were highlighted for the

Committee to consider going forwards and

these form part of the 2026 action plan below:

Committee action plan 2026

Action plan – area of focus

Focus on changes to reporting and

disclosures, including implementation of

Provision 29 of the UK Corporate

Governance Code 2024.

Culture and accountability in relation to

Controls and Internal Audit reviews.

Risk management – deep dives on key areas

of risk, including the effectiveness of the

cyber-security framework

Non-audit services

The Committee has adopted a policy to

safeguard the independence and objectivity

of the external auditor. This policy is aligned

with the requirements of the Financial

Reporting Council’s (FRC) 2019 Revised Ethical

Standard and the US Sarbanes-Oxley Act of

2002 (SOX), and sets out a clear framework for

determining the appropriateness of engaging

the external auditor for non-audit services.

The policy includes a defined list of permitted

non-audit services, consistent with applicable

regulatory standards. Any service not included

on this list is expressly prohibited.

Under the policy, the Committee has

pre-approved the use of the external auditor

for non-audit services where:

—

The service is included in the list of

permitted non-audit services.

—

The fee does not exceed £100,000 and is

approved by the Group Financial Controller

or their designate in defined circumstances.

—

The fee exceeds £100,000 and is approved

by both the Chief Financial Officer and the

Chair of the Committee.

The total fees for non-audit services provided

by the external auditor are reported to the

Committee on a quarterly basis. Approvals by

management under monetary thresholds are

not a delegation of the Committee’s authority,

but rather a confirmation that the services fall

within the scope of the policy.

Throughout the year, the Committee

reviewed the nature and extent of non-audit

services undertaken by the external auditor

to ensure that their independence was

not compromised. For the year ended

31 December 2025, the external auditor

provided non-audit services in relation to

other assurance engagements, corporate

finance and advisory services, with total fees

amounting to £1m.

Spotlights

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Committee activities

External ESG targets

—

Regularly reviewed Haleon’s performance against the responsible

business scorecard measures.

—

Evaluated the progress towards Haleon’s external packaging

and recycle-ready targets.

Deep dives

—

Evaluated consumers’ approach to sustainability with a

specific focus on Gen Z.

—

Reviewed Haleon’s 2025 TNFD LEAP assessment, mapping

dependencies, impacts, risks, and opportunities related to nature.

—

Evaluated progress against sustainable packaging targets and

their evolution to 2030 to respond to latest external

developments.

—

Reviewed the new health inclusivity goal:

we aim to provide

opportunities for over 300 million people a year to take more

control of their everyday health by 2030. We will do this by

building health literacy, increasing access to everyday healthcare

products and tackling bias and prejudice.

External reporting

—

Reviewed external disclosures in relation to TCFD and TNFD

reporting, Haleon’s Health Inclusivity and Sustainability Report,

Human Rights Statement and alignment with relevant external

ESG rating requirements.

—

Reviewed the results of the Double Materiality Assessment (see

page 5 and 6 of our Health Inclusivity and Sustainability Report)

—

Regularly reviewed Haleon’s readiness for future disclosure

requirements, including CSRD.

Stakeholder engagement

—

Discussed regular updates on stakeholder engagement, including

partnerships with key customers, supplier forums, and ongoing

dialogue with policymakers, NGOs, and investors.

Key duties and responsibilities

The Committee’s responsibilities for

environmental and social sustainability (ESS)

include:

—

Monitoring Haleon’s progress against its

ESS goals and associated external

governance and regulatory requirements.

—

Reviewing emerging ESG issues that could

impact the Group’s operations, initiatives,

or reputation.

—

Overseeing engagement with relevant

external stakeholders, NGOs, and other

interested parties.

—

Confirming the accuracy and transparency

of ESG disclosures within the Annual Report

and Form 20-F, health inclusivity and

sustainability Report and other external

disclosures.

Membership and meetings

The Committee comprises solely Independent

Non-Executive Directors.

In 2025, meetings were regularly attended by

the Chair, CEO, Chief Corporate Affairs Officer,

VP Sustainability, and the ESG Programme and

Reporting Director.

Further information is set out on page 64.

Looking ahead

In 2026, the Committee will:

—

Maintain oversight of ESG performance and

KPIs, with a continued focus on packaging,

carbon emissions reduction, health

inclusivity, and nature-related impacts.

—

Oversee Haleon’s preparedness for evolving

external reporting obligations, including

CSRD and ISSB-aligned requirements,

both at Group level and jurisdiction specific.

—

Continue deep dive sessions on priority

ESG topics, stakeholder engagement and

regulatory developments.

—

Review plans to build supply chain resilience

in response to nature and climate risks.

See also our

approach to health

inclusivity and sustainability

from

page 15.

Marie-Anne Aymerich

Chair

I am pleased to present the 2025 report of the Environmental & Social

Sustainability Committee, marking another year of progress.

This year, the Committee maintained strong oversight of our health inclusivity and

sustainability initiatives, regularly reviewing performance against our responsible

business scorecard. Haleon has made continued progress against its targets,

including significant reductions in carbon emissions and improvements

in sustainable sourcing and packaging. Importantly, 31 December 2025 marks

the end point for some of our sustainability targets where we set goals to 2025

and to 2030. I am pleased to report that Haleon has delivered on these

commitments, meeting the health inclusivity goal, empowering more than

74 million people to be more included in opportunities for better everyday

health in 2025. In addition, Haleon has met its goals for virgin plastic reduction,

decreasing by over 10% by the end of 2025 vs. the 2022 baseline, and making all

product packaging recycle-ready by 2025 where safety, quality and regulations

permit. These results reflect the effectiveness of our strategy, our actions and

the dedication of Haleon’s teams. We now turn our focus to meeting the targets

for 2030.

Major milestones in the year include the endorsement of Haleon’s new

Health Inclusivity goal for 2030, reviewing the assessment of nature-related

dependencies, impacts, risks and opportunities, including our first Taskforce for

Nature Related Financial disclosure (TNFD) statement, the review of Haleon’s

progress on sustainable packaging and evolution of our recyclability goal and

latest external developments. The Committee also oversaw the results of

Haleon’s CSRD-aligned Double Materiality Assessment and preparations for

new regulatory frameworks, to ensure Haleon remains ready for evolving

disclosure requirements.

Looking ahead, the Committee will continue to oversee key environmental, social

and governance performance and KPIs, regulatory readiness, and will conduct

deep dives into current and evolving ESG topics. On behalf of the Committee,

I would like to thank all contributors for their dedication and look forward to

another year of progress in delivering Haleon’s external commitments.

Environmental &

Social Sustainability

Committee Report

Haleon

Annual Report and Form 20-F 2025

Committee focus areas in 2025

Throughout the year, the Committee

conducted several deep dive sessions

to evaluate Haleon’s progress toward health

inclusivity and sustainability goals and its

readiness for future regulatory and reporting

requirements. Often, these deep dives either

included or were preceded by sessions led by

external experts, offering broader insights and

external viewpoints on the topics discussed.

These sessions further enhanced the

Committee’s understanding of both current

and upcoming requirements for sustainability

reporting, Haleon’s readiness to meet those

standards, and the impact of external factors

on Haleon’s ability to achieve its objectives.

Sustainable packaging

As the Company approached the ’by the end

of 2025’ goal deadline for its externally

committed sustainable packaging goals, the

Committee had a deep dive into Haleon’s

sustainable packaging strategy, virgin plastic

reduction and recycle-ready packaging

progress and targets for 2026 onwards.

The Committee discussed key external

developments including ’recyclability’

standards and definitions, changes to

regulation across jurisdictions, technology

advancements and limitations, and challenges

in meeting stringent safety, quality and

regulatory requirements for healthcare

packaging. The Committee was pleased

that Haleon has achieved the sustainable

packaging goals which concluded at the end

of 2025. We remain committed to our 2030

target to reduce our use of virgin plastic by

1/3 and will revisit our target to make all

packaging recyclable or reusable by 2030

where safety, quality and regulation permits,

in light of evolving standards.

Carbon

In its 2025 reporting period, Haleon made

significant progress in reducing its carbon

footprint. The Company achieved a 55%* net

reduction in Scope 1 and 2 carbon emissions

vs the 2020 baseline. This was driven by

a continued focus on renewable electricity,

decarbonisation of manufacturing operations,

and targeted energy efficiency projects.

Haleon also advanced its Scope 3 supply chain

decarbonisation through strong supplier

engagement, resulting in a 13% reduction in

Scope 3 source to sale emissions vs 2022.

Looking ahead, Haleon remains committed to

its near term goal to reduce Scope 3 carbon

emissions from source to sale by 42% by 2030

vs our 2022 baseline.

Nature

During 2025, the Committee considered the

Company’s dependencies, impacts, risks and

opportunities in relation to nature ahead

of our first disclosures in accordance with

the recommendations of the Taskforce for

Nature-related Financial Disclosures (TNFD),

which are included in this report (pages 19

to 30). The Committee reviewed Haleon’s

reliance on nature across the value chain,

considering its own operations, upstream

sourcing, consumer use and disposal. We

examined key dependencies, impacts, risks

and opportunities (DIROs) related to natural

sources and our reliance on water across the

value chain. The analysis confirmed that

the actions Haleon is taking through its

Sustainable Sourcing and Water stewardship

goals and engagement with suppliers address

its priority DIROs and highlighted areas for

continued focus. Looking ahead, management,

with the Committee’s oversight, will be

working with key functions to progress actions,

embed these into relevant programmes and

activity plans and track progress in managing

our DIROs in relation to Nature through the

health inclusivity and sustainability scorecard.

ESG performance and reporting

The Committee maintained oversight of

Haleon’s ESG performance through regular

reviews of our responsible business scorecard.

We monitored progress against key

commitments across environmental targets

(including packaging); health inclusivity goals,

latest performance on inclusion and belonging

and actions to uphold robust standards for

product quality, health and safety and human

rights. The Committee received regular

updates on CSRD linked to the EU Omnibus

process and other relevant reporting

regulations, as well as engagements with

policymakers on these topics. The Committee

considered Management’s analysis to support

future KPIs and targets for 2026 and beyond,

and considered the output of the CSRD double

materiality assessment.

Stakeholder engagement

Engagement with stakeholders on ESG matters

remained a priority in 2025. The Committee

received regular updates on interactions

with consumers, customers, employees,

policymakers, industry regulators, investors

and suppliers. This included hosting sessions

on the Phase 3 results of the Health Inclusivity

Index from May onwards, sessions on

Health policy at the UN General Assembly

in September 2025 and a Supplier Summit

and series of deep dives on priority topics

from March onwards. Throughout the year,

management engaged with key retail

partners and with ESG investors on a 1:1 basis.

Committee performance review

As part of the Board and Committee

performance review, the Committee was

assessed to be operating effectively, with

good oversight of the Company’s health

inclusivity and sustainability agenda.

The Committee progressed all the key areas

of focus from the 2025 performance review

disclosed last year. A number of areas were

highlighted for the Committee to consider

going forwards and these form part of the

2026 action plan below:

Committee action plan 2026

Action plan – area of focus

Continue to focus on Haleon’s

preparedness for external sustainability

disclosures including CSRD.

Continue oversight of the delivery of

sustainability KPIs and targets.

Education/deep dives on areas of

ESG evolution.

Health inclusivity goal

During 2025, the Committee undertook a comprehensive and

collaborative process to define Haleon’s new social impact

goal, to ensure it aligns with the Company’s Win as One

strategy and its ambitions, reflects its values and the evolving

expectations of stakeholders.

The journey began with a review of Haleon’s existing social

impact ambitions and benchmarking against industry best

practice. The Committee endorsed Haleon’s focus on tackling

three key barriers to better everyday health – lack of health

literacy, bias and prejudice, and accessibility – as the most

material areas where Haleon could make a meaningful

difference. These focus areas were selected through research

and external benchmarking, aligning closely with Haleon’s

business activities and broader purpose. After careful

discussion, Haleon’s health inclusivity goal from 2026 onwards

was changed to:

’we aim to provide opportunities for over

300 million people a year to take more control of their

everyday health, by 2030’.

The Committee considered the

quantification of the goal and how to measure progress

effectively while meeting current and future reporting,

regulatory and assurance requirements, including those

under CSRD.

Throughout the process, the Committee engaged with a wide

range of stakeholders, including external experts, to ensure

the goal was relevant and impactful. The Committee will

continue to oversee the implementation of the health

inclusivity goal, ensuring that measurement approaches

remain robust, stakeholder engagement is ongoing, and the

goal continues to reflect Haleon’s commitment to health

inclusivity and positive social impact, aligned to Haleon’s

strategic framework.

Spotlight

KPMG LLP has issued independent limited

assurance over the selected data indicated using

assurance standards ISAE(UK) 3000 and ISAE3410.

KPMG LLP’s limited assurance conclusion is

available at

2025 KPMG Limited Assurance

Opinion

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Key duties and responsibilities

The Committee’s responsibilities include:

—

Leading the process for appointments to

the Board and its Committees.

—

Ensuring plans are in place for orderly

succession to the Board and senior

leadership positions.

—

Overseeing the development of a pipeline

for succession at Board and senior

management level.

—

Monitoring and, where appropriate,

recommending changes to the Company’s

corporate governance framework.

Membership and meetings

Excluding the Chair, who was considered

independent on appointment, the Committee

comprises solely Independent Non-Executive

Directors.

Details are set out on pages 60 and 61,

together with details of attendance for the year

on page 64. The CEO and the Chief Human

Resources Officer regularly attended meetings,

with other attendees invited as appropriate.

Succession planning and

Board appointments

Throughout the year, the Committee

considered Board succession planning, with a

particular focus on long-term strategy, as July

2025 marked the third anniversary of Haleon’s

listing and the completion of initial three-year

terms for several directors. This forward-

looking approach was reflected in the

appointments of Bláthnaid Bergin and

Matthew Shattock to the Board in 2025,

as well as the appointment of Vindi Banga

as Board Chair and Alan Stewart as Senior

Independent Non-Executive Director effective

from 1 January 2026. These appointments

demonstrate the Committee’s commitment

to maintaining a balanced and highly skilled

Board, aligned with Haleon’s long-term

strategic priorities.

In addition, the Committee oversaw the

appointments of Bláthnaid Bergin to the

Audit & Risk Committee and Matt Shattock

to the Environmental & Social Sustainability

Committee, and monitored progress on

induction plans for the new Board members.

Vindi Banga

Chair

I am pleased to present my first Report as Chair of the Nominations &

Governance Committee, for the period ending 31 December 2025.

This year has been marked by leadership transition. Following the decision by

Dave Lewis to step down as Chair. I was appointed as Chair of the Board and

the Committee, with effect from 1 January 2026. I am honoured to take on this

responsibility and would like to thank Dave for his leadership and substantial

contribution to the Company during his tenure as Chair.

Throughout the year, the Committee has continued to prioritise comprehensive

and robust succession planning for both the Board and the Executive Team.

In February and June, we appointed two new Independent Non-Executive

Directors following thorough, focused selection processes aligned with our

Board skills and experience matrix. The Committee recommended their

respective appointments to the Environmental & Social Sustainability Committee

and the Audit & Risk Committee, both of which were confirmed in July, further

strengthening the collective expertise of the Board and its Committees.

The Committee also undertook a robust process to identify my successor

as Senior Independent Director. Following the review, the Committee

recommended the appointment of Alan Stewart as Senior Independent Director.

I look forward to working closely with him during my tenure.

We continued to monitor progress against our Board Inclusion Policy objectives,

while regularly reviewing the evolution, composition and effectiveness of both

the Board and its Committees. This year’s Board and Committee performance

review confirmed that the Committee continues to operate to a high standard.

Actions arising from the review are set out later in this report and will form the

key areas of focus for 2026.

Nominations &

Governance Committee

Report

Committee activities

Succession planning

—

Reviewed Board succession, including the tenure of

Non-Executive Directors and the Board skills and experience

matrix.

—

Reviewed Executive succession for the CEO, CFO, Executive team

and senior management, including composition, capabilities,

developments and succession.

—

Considered the criteria for Non-Executive Director appointments

and recommended the appointments of Bláthnaid Bergin and

Matthew Shattock to the Board, as well as Alan Stewart as Senior

Independent Non-Executive Director.

—

Recommended to the Board, Dave Lewis' resignation as Board

Chair from 31 December 2025, and recommended the

appointment of Vindi Banga as Board Chair with effect from

1 January 2026.

Board composition

—

Reviewed the composition of the Board and its Committees.

—

Recommended the appointment of Bláthnaid Bergin to the Audit

& Risk Committee and Matthew Shattock to the Environmental &

Social Sustainability Committee.

—

Discussed progress against objectives and reviewed the Board

Inclusion Policy.

—

Reviewed the impact of the Chair transition on Board and

Committee composition and responsibilities.

Evaluation and annual assessment of performance

—

Assessed the independence of the Non-Executive Directors.

—

Recommended to the Board that each Director stand for

re-election by shareholders at the Company’s 2025 AGM.

—

Reviewed and made recommendations to the Board in respect

of each Director’s actual, potential or perceived conflicts

of interest.

—

Reviewed the independence and time commitments of the

Non-Executive Directors.

Governance

—

Regularly reviewed progress against the 2025 Board and

Committee action pans.

—

Annual review of potential conflicts of interest.

—

Annual review and recommendation for approval to the Board

of the terms of reference of the Committee.

—

Considered the Director induction plans for Bláthnaid Bergin

and Matthew Shattock.

Haleon

Annual Report and Form 20-F 2025

Throughout the year, the Committee regularly

reviewed the Board Skills Matrix, taking into

account diversity, ethnicity, tenure, and the

breadth of expertise required to support

Haleon’s strategic objectives.

Chair succession

The Committee played a key role in overseeing

the succession of the Board Chair. In November

2025, Sir Dave Lewis informed the Committee

of his decision to step down from the Board.

Vindi Banga, then Senior Independent Director,

indicated his willingness to be considered for

the role of Chair. The independent Committee

members undertook a thorough evaluation of

Vindi’s candidature, considering his extensive

experience chairing public and private

companies, deep knowledge of Haleon’s

business, strategy, and markets, and his

strong relationships with management and

stakeholders. The Committee discussed the

merits of conducting an external search vs

appointing Vindi, recognising the continuity,

stability, and strategic alignment his

appointment would provide at this stage

in the Company’s transformation. Following

this evaluation, the Committee (excluding

Sir Dave Lewis and Vindi Banga) recommend

to the Board the resignation of Sir Dave Lewis

as Board Chair with effect from 31 December

2025, and the appointment of Vindi Banga

as Board Chair with effect from 1 January 2026.

The Committee subsequently undertook a

process to identify a new Senior Independent

Director. Following a robust assessment and

considering his experience and contributions

to the Board, the Audit & Risk Committee

since his appointment in September 2024,

the Committee (excluding Alan Stewart)

recommended to the Board the appointment

of Alan Stewart as Senior Independent

Director with effect from 1 January 2026.

Executive Committee changes

The Committee also discussed the Company’s

leadership requirements including assessing

the Executive Team’s capabilities and

development plans against the current

and future succession needs. In addition,

it reviewed the people strategy and talent

agenda more broadly to help in developing

a pipeline of potential future leaders.

Nathalie Gerschtein joined the Executive Team

in May 2025 as President, North America.

Carl Haney joined the Executive Team in

August 2025 as Chief R&D Officer.

In early 2026, we announced the evolution

of our operating model to support our Win as

One strategy. This included creating a Chief

Growth Officer role and a Chief Transformation

Officer position, and establishing six

Operating Units to enhance growth,

productivity and organisational agility. These

new roles, together with the Operating Unit

Presidents, will form part of the Haleon

Executive Team, details of which are available

on page 62.

Committee performance review

As part of the internal Board and Committee

performance review, the Committee was

assessed to be operating effectively, with

Director appointments and succession

planning and Board culture positively

highlighted. The Committee progressed all the

key areas of focus from the 2024 performance

review. A number of key areas were

highlighted for the Committee to consider

going forward and these form part of the 2026

action plan below. Succession planning and

talent development will remain areas of key

areas of focus for the Committee in 2026.

Committee action plan 2026

Action plan – area of focus

Succession planning for the Board and the

Executive Team.

Development and talent management for

Executive Team and senior management.

Board and Committee structures to

support longer-term succession.

Composition, time commitment and

independence

The Committee regularly reviews Board

composition to ensure it remains effective

and well balanced. In 2025, we assessed

the Board and Committees collective skills,

experience and composition and confirmed

that each Non-Executive Director continued to

Gender representation as at 5 March 2026

Number of

Board members

Percentage

of the Board

Number of senior

positions on the

Board (Chair, SID,

CEO and CFO)

Number in

executive

management

Percentage

of executive

management

Men

36%

62.5%

Women

64%

37.5%

Not specified/prefer not to say

—

Ethnicity representation as at 5 March 2026

Number of

Board members

Percentage

of the Board

Number of senior

positions on the

Board (Chair, SID,

CEO and CFO)

Number in

executive

management

Percentage

of executive

management

White British or other White

(including minority-white groups)

73%

81%

Mixed/Multiple Ethnic Groups

—

Asian/Asian British

18%

19%

Black/African/Caribbean/Black British

—

Other ethnic group, including Arab

—

Not specified/prefer not to say

—

For the purposes of UKLR 6.6.6 (11), the data disclosed in these tables was compiled using information acquired through

the ‘Self-ID’ tool accessible to employees via the Company’s HR information system. Information relating to the Board was

provided on a voluntary basis.

Data as at the latest practicable date of 5 March 2026.

Executive management is defined as members of the Executive Team (including the CEO and CFO).

Information on the gender representation of the Executive Team and their direct reports is available on pages 37

and 62.

meet the required time commitment alongside

external roles. The Committee also supported

the Board in considering potential conflicts

of interest.

The Board maintains a strong independent

element, with more than half of its members

being Independent Non-Executive Directors,

in compliance with the UK Corporate

Governance Code.

The Committee actively oversees Board

representation, ensuring a balanced range of

experiences and skill sets while maintaining

our focus on merit-based appointments.

As at 5 March 2026, the Company met the

recommendations of the FTSE Women Leaders

Review on gender representation, and the

Parker Review objective on board ethnic

minority representation. The Board met and

exceeded the UK Listing Rules requirements in

respect of gender representation and ethnic

diversity. The adjacent tables provide the

information, required under the UK Listing

Rules in the mandatory format.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

—

Vesting schedule for Performance

Share Plan awards:

the current Policy

permits only a straight-line payout

from threshold to maximum

performance. The proposed Policy will

include the flexibility to set alternative

payout curves if considered

appropriate in future years.

As part of its review, the Committee

observed the continued evolution of

remuneration practices across the FTSE

30 since the introduction of Haleon’s

current Policy in 2023. The Committee

also noted changes in the relative

competitiveness of the CEO and CFO’s

arrangements during this period. In

considering these developments and

recognising the global talent markets in

which Haleon operates, the Committee

determined that the existing opportunity

levels remain appropriate for a company

of Haleon’s scale, operational footprint

and strategic ambitions. The Committee

will continue to review this positioning

over the forthcoming Policy period to

ensure the arrangements remain aligned

with strong governance principles,

support long-term value creation, and

reflect the interests of shareholders.

I would like to thank all shareholders

who engaged with the Committee and

provided valuable feedback on our

proposed Policy updates as well as on

the incentive measures and weightings

Their input has been instrumental in

shaping our approach to the Policy

and incentive design and ensuring

continued alignment with shareholder

expectations.

Letter from the Chair

This Report sets out details of the

outcome of the Committee’s review,

as well as an overview of the business

performance and the corresponding

incentive payments for 2025 and how we

intend to apply our proposed new policy

in 2026.

2026 Directors’ Remuneration Policy

Haleon’s Policy was first put to vote at

the 2023 AGM following our demerger in

July 2022, and the Committee is pleased

that it has operated as intended over the

subsequent period. Having conducted

a thorough review of the Policy against

Haleon’s strategic objectives as well as

considering external market practice,

the Committee agreed that the current

overall remuneration structure remains

appropriate to support the delivery of

the commitments made at our Capital

Markets Day in May 2025, as well as

continuing to support the attraction

and retention of top tier talent.

Accordingly, only minor changes are

proposed for 2026, as follows:

—

AIP deferral:

the standard bonus

deferral rate will remain at 50% of

any bonus earned for three years.

However, where an Executive Director

meets their shareholding requirement,

the deferral requirement will be

removed such that the bonus is

delivered wholly in cash. This change

is aligned with emerging market

practice following the update to the

Investment Association’s guidance.

Stringent malus and clawback

provisions will remain in place to

protect the best interests of the

Company and shareholders.

Implementation of the Policy

in 2026

Alongside the Policy review, the

Committee considered the selection of

performance measures for the Annual

Incentive Plan (AIP) and Performance

Share Plan (PSP) for 2026, in the context

of our Win As One strategy. Following

shareholder engagement, we determined

that the AIP and PSP measures used in

2025 remain appropriate for the next

performance periods. However, in order

to strengthen focus on growth, the 2026

AIP weightings will change from 40% to

50% on organic revenue growth and from

40% to 30% on organic operating profit

growth. The IBOs weighting will remain

unchanged at 20%. A summary of 2026

AIP and PSP measures and their strategic

link is provided on page 88. The

Committee retains flexibility to review

these measures for each cycle to further

reward long-term sustainable growth

in shareholder value.

Our approach to executive

remuneration is designed to drive

sustainable, above-market growth

and attractive returns, while

embedding responsible business

practices at the heart of everything

we do. The Committee remains

committed to transparent, rigorous

performance measures that align

incentives with Haleon’s long-term

strategic priorities. The Committee

continues to monitor the alignment

of our ESG qualifier, ensuring that

our remuneration practices support

Haleon’s values and responsible

business commitments.

Further information about the

measures

and targets

linked to incentive awards is

provided on pages 94–97.

On behalf of the Board, I am

pleased to present the Directors’

Remuneration Report for Haleon plc

for the year ended 31 December 2025.

This year, a key area of focus for the

Remuneration Committee was a

thorough review of our Directors’

Remuneration Policy which we are

required to renew at our 2026 AGM.

Tracy Clarke

Chair

Directors’

Remuneration Report

Haleon

Annual Report and Form 20-F 2025

The Committee is satisfied that the

vesting outcome is reflective of broader

underlying business performance over

the three years, in particular the

substantial deleveraging achieved, and

that plans to meet Haleon’s responsible

business commitments are on track.

2025 was the last year when the ESG

qualifier included a recycle-ready

packaging threshold, aligned to our

external commitment to develop

solutions for all packaging to be

recycle-ready by end 2025, where

safety, quality and regulations permit.

Our 2025 ambition has been successfully

achieved. Given this, and as previously

communicated, from 2026 our

sustainable packaging ESG qualifier

switches to focus on our goal to reduce

our use of virgin petroleum-based

plastic, aligned to our external

commitment to reduce our use of

virgin plastic by a third by 2030 vs

our 2022 baseline.

The Committee is satisfied that the

outcomes under the AIP and PSP reflect

the Company’s performance over the

respective periods and are aligned

with the experience of our shareholders.

For reference, our share price remained

broadly flat over 2025 and grew at c.5%

p.a. over 2023–2025. No discretion has

been applied to the final payouts.

Full details of the

2025 remuneration

paid to the Directors and the basis for its

determination are set out on pages 93–96.

Remuneration and workforce

alignment

For the year ended 31 December 2025,

the CEO pay ratio was 76:1, reflecting

both the outcomes of our performance

based incentive plans and the salary

increases awarded across the

organisation. This ratio is consistent

with FTSE 100 norms. The Committee

will continue to monitor this ratio and

broader pay equity trends, ensuring

our remuneration practices support

Haleon’s values and culture.

After careful consideration of workforce

remuneration, inflation, and market

trends, the Committee approved a 3.2%

salary increase for Executive Directors,

mirroring the average increase awarded

to UK employees. This ensures fairness

and consistency across the organisation.

The Committee also approved the fee

level for our new Chair, Vindi Banga,

set at a level in line with the previous

incumbent. The 2026 base fees for the

Chair and Non-Executive Directors will

increase by 3.2%. All increases will take

place from 1 April 2026.

AGM and shareholder engagement

The Committee was pleased with the

strong support received for our 2024

Directors’ Remuneration Report (98.7%

votes in favour). In November 2025,

I wrote to our largest shareholders to

inform them of the planned changes

to the Directors’ Remuneration Policy

and the 2026 AIP and PSP performance

measures. I am very grateful for the

support and valuable comments that

we have received. We hope to maintain

the strong shareholder support which

was received for our current Directors’

Remuneration Policy at the 2023 AGM

(approval vote: 98.19%) as we put our

Policy to vote in 2026.

Rewarding 2025 performance

During 2025, Haleon made meaningful

progress across all aspects of our

strategy. Despite a softer consumer

and customer environment, with global

category growth falling below historic

averages, we delivered good financial

results. Organic revenue growth was

achieved at 3.0% and organic operating

profit growth was achieved at 10.5%.

This resulted in the overall outcome

under the financial measures of the 2025

Annual Incentive Plan (AIP) of 44% of

the maximum opportunity, and a below

target outcome of 88%. This outcome

is aligned with the wider workforce on

the same global financial measures.

Individual AIP outcomes for Executive

Directors, including performance against

the Individual Business Objectives

(IBOs), are 47.7% of maximum for the

CEO and 46.9% of maximum for the CFO.

The Haleon Performance Share Plan

(PSP) awards granted in 2023 will vest

in March 2026, by reference to the

performance period ended on

31 December 2025. The outcome for

these awards was 82% of maximum

based on performance against the

cumulative free cash flow and net debt/

adjusted EBITDA targets. This outcome

includes an adjustment to exclude the

impact of a change in the Company’s

dividend policy. As the payment of

higher dividends was considered to be

in the best interests of shareholders and

was not anticipated at the time targets

were set, the Committee determined that

it was appropriate to exclude the impact

of this change from the vesting outcome.

I am confident that the new Policy, and

our approach to its implementation in

2026, will continue to support value

delivery to shareholders and enable

Haleon to attract and retain high-calibre

talent. The Committee remains

committed to transparent, responsible

remuneration practices and welcomes

ongoing feedback from shareholders

ahead of the 2026 AGM.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Key duties and responsibilities

The Remuneration Committee’s principal

responsibilities are:

— Making recommendations to the Board

on remuneration principles and policy

applied to the Executive Directors.

— Setting, reviewing and approving

individual remuneration arrangements

for the Chair, Executive Directors,

senior leadership and the Company

Secretary.

— Designing remuneration policies and

practices that support the Company’s

strategy and promote its long-term

sustainable success.

— Ensuring that performance conditions

are transparent, stretching and

rigorously applied.

— Enabling the use of discretion

over outcomes and recovery and

withholding of awards where the

Committee deems this to be

appropriate.

— Making recommendations to the Board

concerning the introduction of new

share incentive plans which require

Board or shareholder approval.

— Reviewing employee remuneration and

key related policies, and the alignment

of incentives and rewards with the

Company’s culture, and taking these

into account when determining the

policy for executive remuneration.

Directors’ Remuneration Report

continued

Membership and meetings

The Committee comprises solely

Independent Non-Executive Directors.

Details are set out on pages 60 and 61,

together with attendance for the year on

page 64. The Chair, CEO, Chief Human

Resources Officer, Global Head of

Reward and a representative from the

independent remuneration adviser (PwC)

attend meetings on a regular basis.

Other attendees are invited to meetings

as appropriate. The Committee also

meets without management present.

No Directors or executives are present

when their own remuneration is

discussed nor involved in determining

their own remuneration.

As part of the Board and Committee

performance review, the Committee was

assessed to be operating effectively. The

Committee progressed all the key areas

of focus from the 2025 performance

review. The 2026 action plan is below:

Committee action plan 2026

2026 Action plan

Continue oversight and focus on key areas

of the Committee’s remit

Review executive remuneration measures,

weightings and targets in long-term plans

to reflect the value creation framework

Focus on effectiveness and transparency

of disclosures and reporting

Committee activities

Executive remuneration

and incentive plans

—

Approving the 2024 AIP outcome and the 2022 PSP awards vesting outcome.

—

Approving the 2025 AIP and PSP targets, including the IBOs.

—

Approving the 2026 AIP and PSP measures.

—

Approving 2025 and 2026 remuneration arrangements for the members of the

Executive Team, including the Executive Directors, and the Company Secretary.

—

Reviewing the Directors’ Remuneration Policy and the competitive pay positioning

of the Executive Directors.

Stakeholder engagement

—

Considering shareholder feedback on the 2024 Directors’ Remuneration Report and

the outcomes of the 2025 AGM.

—

Considering and approving the 2025 shareholder engagement timeline and materials.

—

Engaging with shareholders to discuss changes proposed to the Policy.

—

Discussing the workforce remuneration arrangements.

Governance

—

Approving the final 2024 and draft 2025 Directors’ Remuneration Reports.

—

Approving the remuneration arrangements for the incoming and outgoing members

of the Executive Team.

—

Approving the 2025 schedule of business.

—

Reviewing potential level of dilution resulting from operation of share plans.

Haleon

Annual Report and Form 20-F 2025

Remuneration

at a glance

The current Directors’ Remuneration

Policy (approved at the 2023 AGM)

will apply until the 2026 AGM. The

Committee is comfortable that the Policy

operated as intended during 2025 and

that the 2025 remuneration paid to

Directors as set out below and within

the Annual Report on Remuneration,

was appropriate.

As set out in the Letter from the Chair

of the Remuneration Committee, a new

Policy is being put forward at our 2026

AGM. Only minor changes are proposed,

primarily to our approach to bonus

deferral where the share ownership

requirements are met.

The new

Directors’ Remuneration Policy

is set out on pages 84–92.

Summary of the application of the Directors’ Remuneration Policy in 2025 and 2026

Element

2025

2026

2027

2028

2029

2030

Application for 2025

Application for 2026 (in line with the new Policy)

Base Salary

2025 base salaries:

—

CEO: £1,351,969

—

CFO: £755,550

2026 base salaries:

—

CEO: £1,395,232 (+3.2%)

—

CFO: £779,728 (+3.2%)

Benefits

Benefits operated in line

with the Policy

Benefits will operate in line

with the Policy

Pension

arrangements

Employer contributions:

—

CEO: 7% of salary

—

CFO: 7% of salary

No change

Annual

Incentive Plan

(AIP)

Deferral period

Maximum AIP opportunities:

—

CEO: 200% of salary

—

CFO: 200% of salary

No change to AIP opportunities.

2025 performance measures:

—

40% Organic revenue growth

—

40% Organic operating profit growth

—

20% IBOs

2026 performance measures:

—

50% Organic revenue growth

—

30% Organic operating profit growth

—

20% IBOs

50% of any AIP earned is

deferred for three years

50% of any AIP earned is deferred for

three years, until the share ownership

requirement is met

Performance

Share Plan

(PSP)

Vesting period

Holding period

PSP award levels:

—

CEO: 450% of salary

—

CFO: 350% of salary

No change to PSP award levels

2025 performance measures:

—

50% Cumulative free cash flow

—

30% Adjusted diluted EPS growth

—

20% Organic operating margin

improvement

—

ESG qualifier

No change to 2026 performance

measures or ESG qualifier

Share ownership

requirements

Share ownership requirements:

—

CEO: 450% of salary

—

CFO: 350% of salary

No change

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

What performance means for Executive Directors’ pay in 2025

At Haleon, remuneration packages are designed to ensure strong alignment between pay and

performance. The Committee considers performance to have been appropriately reflected in the

incentive outcomes, as set out in the Annual Report on Remuneration from page 93.

At a Glance – Executive Director remuneration elements

Salary

Pension and

other benefits

Annual

Incentive Plan

Bonus may be

deferred into

shares for three

years

Performance

Share Plan

Long Term

Variable

Short Term

Fixed

Total

remuneration

2025 AIP outcome

The AIP outcomes were 47.7% of maximum for the CEO and 46.9% of maximum for the CFO.

46.9%

47.7%

CEO

CFO

2023–25 PSP vesting outcome

2023–25 Haleon PSP awards will vest in March 2026 at 82% of maximum, in line with

performance against the cumulative free cash flow, net debt/adjusted EBITDA targets and

ESG qualifier.

82%

CEO

CFO

Note:

Dawn Allen, Chief Financial Officer, joined Haleon in November 2024 and was granted a buyout award vesting in

June 2026 linked to the 2023-25 PSP performance conditions.

2025 remuneration received by Executive Directors

The charts below show the potential maximum levels of remuneration which could be received by

the CEO and the CFO under the Policy, as well as actual remuneration received in respect of 2025.

19%

16%

65%

15%

27%

58%

31%

£8,230,000

£10,152,000

52%

£3,056,000

£4,900,000

17%

27%

23%

50%

CEO Actual

CEO Maximum

CFO Actual

CFO Maximum

Fixed pay

Annual Incentive Plan (AIP)

Performance Share Plan (PSP)/buyout

Note:

CFO Actual includes buyout awards disclosed in the 2025 single figure table.

Shareholding of Executive Directors compared to requirements

Current

shareholding

Shareholding

requirement

CEO

Current

shareholding

Shareholding

requirement

CFO

450%

350%

490%

91%

Shares held as % of salary (actual, incl. beneficially owned shares and unvested DABP shares net-of-tax)

Shares held as % of salary (requirement)

Malus and clawback

The Committee may apply malus and clawback any time prior to the second anniversary of the

date the cash element of an annual bonus is paid, or a share award vests. These periods have

been determined to provide a reasonable time period to identify and remediate any relevant

trigger events and broadly align with the post-vesting holding period and bonus deferral period.

The Committee may invoke the malus and clawback policy provisions in circumstances such as a

material misstatement of results; a failure of risk management resulting in material financial loss;

an error or material misstatement which results in an overpayment (such as in the assessment

of performance); a corporate failure of the Company; employee misconduct; or material

reputational damage to the Company. The Company also operates a mandatory clawback policy

that complies with the US Securities and Exchange Commission (SEC) requirements. In 2025

malus and clawback provisions were not used to reduce or recoup awards.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Link between incentive measures and strategy

A combination of financial and non-financial measures have been chosen to ensure that executive remuneration is aligned with the key performance indicators (KPIs) used by the business to monitor

performance against our strategic priorities. The table below sets out the incentive measures and weightings used in the 2025 AIP and 2025-27 PSP:

KPI

Weight

AIP

PSP

Alignment to strategy

Organic revenue growth

40%

Key measure of growth

Organic operating profit growth

40%

Driving strong operating margin

Free cash flow

50%

A strategic KPI which provides the business with capacity to invest in the business, pay down debt and make

shareholder returns.

Adjusted diluted earnings per share

30%

In the 2023 Annual Report we announced that from 2024 we will focus on adjusted diluted EPS growth at

constant currency to ensure value creation across the business.

Organic operating margin improvement

20%

A focus on profitability, highlighting the importance of achieving margin improvement alongside top-line growth.

Carbon reduction

NA, qualifier

A commitment to reduce our net Scope 1 and 2 carbon emissions by 100%, vs our 2020 baseline by 2030.

Virgin petroleum-based packaging reduction

NA, qualifier

A commitment to reduce our use of virgin petroleum-based plastic by 10% by 2025, and a third by 2030, vs our

2022 baseline.

Note:

The 2023–25 PSP ESG qualifier included a measure based on recycle-ready packaging. From the 2024–26 PSP awards this was replaced by the measure based on reduction in virgin petroleum-based packaging as the external commitment on recycle-

ready packaging runs to end of 2025.

Further details of the performance measures for the 2025 AIP and PSP awards, and how they are aligned with the Company’s strategy and the creation of shareholder value, are set out on pages 94–96 of the

Directors’ Remuneration Report. 2026 AIP and PSP performance measures aligned with the 2026 strategic KPIs are set out on pages 88, and 95–97 of this Directors’ Remuneration Report.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Directors’ Remuneration Policy

This section sets outs the Directors’ Remuneration Policy (Policy) proposed for shareholders’ approval at the 2026 AGM.

Subject to receiving shareholder approval, the Policy is intended to apply immediately from the 2026 AGM for three years to the end of the 2029 AGM. The Committee reserves the right to seek

shareholders’ approval for a new policy during this period, depending on regulatory developments, changes to our strategy or competitive pressures.

The Policy can be found on the Company’s website:

www.haleon.com

Summary of changes to the Directors’ Remuneration Policy

Remuneration

element

Summary of proposed Policy changes

Annual Incentive

Plan – deferral

The standard bonus deferral rate will remain at 50% of any bonus earned for three years. However, where an Executive Director meets their shareholding requirement, the deferral

requirement will be removed such that the bonus is delivered wholly in cash.

This change is aligned with emerging market practice following the update to the Investment Association’s guidance.

The Committee considered the strength of our Malus and clawback policy when approving this proposed change. Following a thorough assessment, it was determined that our policy

adheres to the expectations set out in the UK Corporate Governance Code as well as industry best practice and is suitably robust. This includes requiring both the CEO and CFO to formally

acknowledge and accept the terms of the Malus and clawback policy with each share award grant. In addition, having run scenario analysis the Committee determined that the proposals

result in only a moderate change in the value subject to malus or clawback.

Under the proposed Policy, deferred bonus awards will normally be granted over shares.

However, the Policy permits deferred bonuses to be paid wholly in cash in respect of former

Directors where awards are made after their termination date, or in exceptional circumstances.

Performance

Share Plan

The current Policy permits only a straight-line payout from threshold to maximum performance. The proposed Policy will include the flexibility to set alternative payout curves if considered

appropriate in future years.

Directors’ Remuneration Policy table

Fixed pay

Element

Base salary

Purpose and link

to strategy

To attract, retain and develop key talent by being market competitive and rewarding ongoing contribution to role.

Operation

Base salaries for Executive Directors are set at a level appropriate to secure and retain the high calibre individuals needed to deliver Haleon’s strategic priorities.

The individual’s role, experience and performance, and independently sourced data for relevant comparator groups, will be considered when determining salary levels.

In line with market practice, the Committee will review Executive Directors’ base salaries annually.

Should a new Executive Director have a base salary set below the previous incumbent’s level or below market level, the Committee reserves the right to make phased increases, which may be

above the wider employee level, subject to the individual’s development in role.

Opportunity

There is no formal maximum limit and, ordinarily, salary increases will be broadly in line with the average increases for wider Haleon employees. However, increases may be higher to reflect

a change in the scope of an individual’s role, responsibilities or experience. Salary adjustments may also reflect wider market conditions in the geography in which an individual operates.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Element

Benefits

Purpose and link

to strategy

To provide market-competitive and cost-effective benefits.

Operation

Executive Directors are eligible to receive benefits in line with the policy for other employees which may vary by location. These may include, but are not limited to:

—

private healthcare (including eligibility for the Executive Director’s spouse or partner and eligible dependent children);

—

life assurance/death in service benefit;

—

membership of a Group Income Protection plan;

—

personal tax and financial planning;

—

Directors’ and Officers’ liability insurance maintained by the Company; and

—

any contractual post-retirement benefits.

Executive Directors can be entitled to a car travel benefit or car allowance and home security services. Other benefits include expenses properly incurred in the ordinary course of business,

which are deemed to be taxable benefits on the individual. They also benefit from the indemnity provided by the Company in the form provided to all Directors. Executive Directors in the UK

are also eligible to participate in any all-employee share schemes established by the Group, on the same terms as other employees.

In line with the policy for other employees, Executive Directors may be eligible to receive overseas relocation allowances and international transfer-related benefits when appropriate.

The Company covers any associated tax and social security contributions due on selected benefits.

Opportunity

There is no formal maximum. Benefit provision is tailored to reflect market practice in the geography in which the Executive Director is based, and different policies may apply if current or

future Executive Directors are based in a different country.

Pension

Purpose and link

to strategy

To provide cost-effective, market-competitive post-retirement benefits.

Operation

The approach to pension arrangements for Executive Directors is in line with the broader workforce.

Executive Directors are eligible to participate in the Group’s defined contribution pension plan or receive a cash allowance in lieu of employer’s pension contribution.

Opportunity

In the UK, employees contribute a core amount equal to 2% of their base salary. The Company contributes a core amount equal to 7% of their base salary and matches additional employee

contributions up to 3% of their base salary.

To the extent that any relevant cap on tax-advantaged contributions applies, or where the Executive Director does not participate in the Haleon pension plan, the proportion of the

Company’s contribution of 7% of base salary not paid into that pension plan is paid to that Executive Director as a cash allowance.

The maximum opportunity may change over time if the rate provided to the majority of the wider UK employee population changes.

Fixed pay continued

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Variable pay

Element

Annual Incentive Plan (AIP)

Purpose and link

to strategy

To incentivise and recognise execution of the business strategy on an annual basis.

Operation

Performance measures, weightings and targets are set annually by the Remuneration Committee.

Appropriately stretching targets are set by reference to the business plan and historical and projected performance for the Company. The level of award is determined with reference to

Haleon’s overall financial and strategic performance and individual performance.

Executive Directors are required to defer 50% of any bonus earned, normally into an award over Haleon Shares or Haleon ADSs under the Haleon plc Deferred Annual Bonus Plan (DABP), which

will normally vest on the third anniversary of grant, subject to continued employment. Mandatory bonus deferral will no longer apply once the share ownership requirement has been met.

DABP awards are eligible for dividend equivalent payments in respect of dividends that would have been paid on the shares or ADSs up to the date the awards vest.

The Remuneration Committee may apply judgement in making appropriate adjustments to bonus outcomes (either up or down) to ensure they reflect underlying business performance.

The proportion of any bonus satisfied in cash will be subject to the malus and clawback provisions.

The period during which any cash award may be recovered will be two years from the date the relevant bonus is paid. The proportion of any bonus deferred into a DABP award will be subject

to the leaver and malus and clawback provisions (see ‘Payment for loss of office’ and ‘Malus and clawback’ sections).

Normally, 25% of the maximum bonus will be payable for threshold performance and 50% of the maximum bonus will be payable for on-target performance.

Opportunity

The maximum bonus opportunities for outstanding performance are 200% of salary.

Performance

measures

Performance measures are based on a combination of financial targets (at least 50% of the AIP) and individual business objectives, with the weighting of measures determined by the

Remuneration Committee each year according to business priorities. Performance is measured over one year.

Performance Share Plan (PSP)

Purpose and link

to strategy

To incentivise and recognise delivery of longer-term business priorities, financial growth and increases in shareholder value.

Operation

Under the PSP, awards may be granted in the form of conditional share awards or nil-cost options.

These awards to Executive Directors are subject to performance conditions set by the Remuneration Committee. Awards are granted annually to Executive Directors under the PSP and

normally have a three-year performance period and a further post-vesting two-year holding period.

The Remuneration Committee may adjust the formulaic vesting outcome (either up or down) to ensure that the overall outcome reflects underlying business performance over the vesting period.

Awards are eligible for dividend equivalent payments in respect of dividends that would have been paid on the shares or ADSs that vest under the PSP awards up to the date the awards vest.

Awards will be subject to the leaver and malus and clawback provisions (see ‘Payment for loss of office’ and ‘Malus and clawback’ sections below).

Normally, 25% of the award will vest if threshold level of performance is achieved. Normally, straight-line interpolation is applied for performance between threshold and maximum.

The Committee has flexibility to determine the profile of the payout curve for each award.

Opportunity

The normal maximum awards that may be granted under the PSP in respect of any financial year are 450% of salary for the CEO and 350% of salary for the CFO.

Performance

measures

Performance may be assessed against a combination of financial (at least 50%) and non-financial (including strategic and/or ESG-related) measures which are aligned to the Company’s

strategic plan.

The Remuneration Committee has discretion to amend the performance measures in exceptional circumstances if it considers it appropriate to do so, e.g. in cases of accounting policy

changes, merger and acquisition activities or disposals. Any such amendments would be fully disclosed and explained in the following year’s Annual Report on Remuneration.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Share ownership requirements

Element

Purpose and link

to strategy

To align Executive Directors’ interests with those of shareholders.

Operation

Executive Directors are required, subject to personal circumstances, to build and maintain significant holdings of shares in the Company over time. The requirements for the CEO and CFO are

450% and 350% of salary respectively.

Until the relevant share ownership requirements have been met, Executive Directors are required to hold all Haleon shares acquired under the PSP and/or DABP (net of income tax and

National Insurance contributions).

Executive Directors are required to comply with shareholding requirements for two years after departure, at a level equal to the lower of their shareholding requirement immediately prior to

departure or their actual shareholding on departure. During this period, former Directors will be required to seek permission to deal from the Company Secretary, to ensure they comply with

the requirement. In addition, the Company will collect annual affirmations from former Directors subject to the shareholding requirement to confirm that they remain compliant.

Malus and clawback

Element

Purpose and link

to strategy

To align Executive Directors’ interests with those of shareholders and prevent payment for failure.

Operation

The Committee may apply malus and clawback at any time prior to the second anniversary of the date the cash element of an annual bonus is paid, or a share award vests.

The Committee may only invoke these malus and clawback provisions in accordance with the Haleon malus and clawback policy from time to time, in circumstances such as a material

misstatement of results; a failure of risk management resulting in material financial loss; an error or material misstatement which results in an overpayment (such as in the assessment of

performance); a corporate failure of the Company; employee misconduct; or material reputational damage to the Company.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Notes to the policy table

Approach to selecting performance measures

Performance targets are set to be stretching, yet achievable, and take into account the

Company’s strategic priorities and business environment. The Committee sets targets based on

a range of reference points including the business plan, analysts’ consensus and historical and

projected performance for the Company. A combination of financial and non-financial measures

has been chosen to ensure that executive remuneration is aligned with the key performance

indicators we use as a business to monitor performance against our strategic priorities. The table

below sets out incentive measures and weightings used in 2026:

KPI

Weight

AIP

PSP

Alignment to strategy

Organic revenue growth

50%

Key measure of growth

Organic operating

profit growth

30%

Driving strong operating margin

Free cash flow

50%

A strategic KPI which provides the business with

capacity to invest in the business, pay down debt

and make shareholder returns.

Adjusted diluted

earnings per share

30%

In the 2023 Annual Report we announced that from

2024 we will focus on adjusted diluted EPS growth

at constant currency to ensure value creation across

the business.

Organic operating

margin improvement

20%

A focus on profitability, highlighting the importance

of achieving margin improvement alongside top-line

growth.

Carbon reduction

NA,

qualifier

A commitment to reduce our net Scope 1 and 2

carbon emissions by 100%, vs our 2020 baseline

by 2030.

Virgin petroleum-based

packaging reduction

NA,

qualifier

A commitment to reduce our use of virgin

petroleum-based plastic by 10% by 2025, and a

third by 2030, vs our 2022 baseline.

Note

The 2023–25 PSP ESG qualifier included a measure based on recycle-ready packaging. From the 2024–26 PSP awards this

was replaced by the measure based on reduction in virgin petroleum-based packaging as the external commitment on

recycle-ready packaging runs to end of 2025.

Further details of the performance measures under the 2025 and 2026 AIP and PSP awards, and

how they are aligned with Company strategy and the creation of shareholder value, are set out

on pages 94 to 97 of this Directors’ Remuneration Report.

Differences in policy from the wider employee population

The structure of the reward package for the wider employee population is based on the

principle that it should be sufficient to attract and retain the best talent and be competitive

within our broader industry, remunerating employees for their contribution linked to our holistic

performance. It is driven by local market practice as well as level of seniority and accountability,

reflecting the global nature of Haleon’s business.

There is clear alignment in the pay structures for Executives and the wider employee population,

in the way that remuneration principles are followed as well as the mechanics of the salary

review process and incentive plan design, which are broadly consistent throughout the

organisation. Most of the performance measures under the AIP and the PSP are the same for

Executives and other eligible employees. Under Haleon’s policies, there is a strong focus on

performance-based incentives, with appropriate levels of differentiation to ensure that reward

is invested in the talent that will make the biggest contribution to the execution of Haleon’s

strategy. Where possible, the Company also encourages employee share ownership through

a number of share plans that allow employees to benefit from the Company’s success.

The remuneration approach for Executive Directors is consistent with the reward package for

members of the Executive Team and the senior management population. Generally speaking,

a much higher proportion of total remuneration for Executive Directors is linked to business

performance, compared to the rest of the employee population, so that remuneration will

increase or decrease in line with business performance and to align the interests of Executive

Directors and shareholders.

Consideration of employment conditions elsewhere in the Company

The Committee, along with setting the remuneration packages of Executive Directors, also

has purview over the reward arrangements of the wider employee population. Although the

Committee did not specifically consult employees when setting policy, employment conditions

and remuneration arrangements applicable for the wider employee population are taken

into account by the Committee when making decisions on executive remuneration (including

workforce salary increases and bonus outcome). The Committee also considers the CEO pay

ratio and the Haleon UK gender pay gap.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Projected total remuneration scenarios

The charts below illustrate scenarios for the projected total remuneration of Executive Directors

at four different levels of performance: minimum, target, maximum, and maximum including

assumed share price appreciation of 50%. The impact of potential share price movements is

excluded from the other three scenarios. These charts reflect projected remuneration for the

2026 financial year.

100%

£1,628,000

23%

20%

15%

26%

12%

20%

68%

57%

59%

£6,947,000

£10,697,000

£13,836,000

Minimum

CEO

Target

Maximum

Maximum including

share price growth

100%

£867,000

26%

23%

17%

30%

13%

24%

51%

53%

63%

£3,353,000

£5,156,000

£6,520,000

Minimum

CFO

Target

Maximum

Maximum including

share price growth

Fixed pay

AIP

PSP

Basis of calculation and assumptions:

— The ‘Minimum’ scenario shows fixed remuneration only, i.e. base salary applicable from 1 April

2026, total value of taxable benefits for 2025, and the pension benefits to be accrued over

the year ending 31 December 2026. These are the only elements of the Executive Directors’

remuneration packages that are not subject to performance conditions.

— The ‘Target’ scenario shows fixed remuneration as above, plus a target payout under the

AIP (50% of the maximum annual bonus) and mid-point performance vesting for long-term

incentive awards at 62.5% of the maximum award.

— The ‘Maximum’ scenario reflects fixed remuneration, plus full payout of annual and long-term

incentives.

— The ‘Maximum including share price growth’ scenario reflects fixed remuneration, plus full

payout of annual and long-term incentives, including for the latter an assumed 50% share

price appreciation over the performance period.

Consideration of shareholder views

The Committee greatly values the continued dialogue with Haleon’s shareholders and regularly

engages with shareholders and representative bodies to take their views into account when

setting and implementing the Company’s remuneration policies.

In 2025, the Committee Chair reached out to the Company’s 20 largest shareholders to discuss

proposed changes to the Directors’ Remuneration Policy and proposed 2026 incentive measures.

Feedback provided by shareholders was considered by the Committee at its regular meetings

and was taken into account in discussions on the 2025 and 2026 remuneration arrangements.

The majority of our shareholders were supportive of the Company’s proposed approach to pay,

and the Committee will continue to review this Policy to ensure it is fit for purpose. The

Committee will consult major shareholders before making significant changes to the Policy.

Annual shareholder engagement process

June-July

Committee review and determination of potential changes to policy or remuneration

design.

September-December

Letter sent to major shareholders and proxy agencies setting out proposed

amendments under consideration.

September-February

Consultation with major shareholders and proxy agencies on proposals. Committee

discuss and agree final proposals.

February-March

Letter sent to major shareholders and proxy agencies to explain how feedback was

considered, and setting out final proposals.

March-May

Annual Report, containing a description of any changes, is published, and a voting

resolution put to shareholder vote at the AGM.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Recruitment policy

The remuneration package of new Executive Directors (both external hires and internal promotions) will be determined on a case-by-case basis, in line with the provisions of this Directors’

Remuneration Policy.

Element

Approach

Fixed pay

Base salaries of new Executive Directors will be determined by the individuals’ role, experience, their existing remuneration package and independently sourced data for relevant

comparator groups.

Pension and benefits will be set in line with the policy in force for other Executive Directors. The Company may provide relocation support where appropriate.

AIP

The structure described in the Policy for other Executive Directors will apply to new appointees with the relevant maximum opportunity.

PSP

New appointees will be granted awards under the PSP on the same terms as other Executive Directors, as described in the Policy. The maximum level of award that may be offered

for the year of recruitment is in line with the maximum award under the Policy.

Buyout

The Committee is mindful of the sensitivity relating to recruitment packages and, in particular, the ‘buying out’ of rights relating to previous employment.

The intent is to seek to minimise such arrangements. However, in certain circumstances, the Committee may determine that such arrangements are in the best interests of the

Company and its shareholders, and such arrangements will, where possible, be on a like-for-like basis with the forfeited remuneration terms.

In doing so, the Committee will consider relevant factors including any performance conditions attached to these awards and the likelihood of those conditions being met. The aim

of any such award would be to ensure that as far as possible, the expected value and the structure of the award will be no more generous than the amount forfeited.

The Committee retains the discretion to rely on the exemption under the UK Listing Rule 9.3.2R to make such an award, or to utilise any other incentive plan operated by the Group.

For the avoidance of doubt, buyout awards will be excluded from the maximum incentive opportunities stated above.

Other elements

The Committee reserves the right to make any remuneration payments notwithstanding that they are not in line with the policy set out above, where the terms of the payment were

agreed at a time when the relevant individual was not a Director of the Company, or under a prior approved policy and, in the opinion of the Committee, the payment was not in

consideration of the individual becoming a Director of the Company.

For an overseas appointment, the Committee will have discretion to offer cost-effective benefits and pension provisions which reflect local market practice and relevant legislation.

Payment for loss of office

Element

Approach

Fixed pay

The Company’s policy is that Executive Directors’ service contracts will not require the Company to give an executive more than 12 months’ notice without prior shareholder

approval. In the event of termination, the Executive Directors’ service agreements provide for payments of base salary, pensions and benefits over the notice period or for immediate

termination on making a payment (or phased payments) in lieu of notice equivalent to base salary only for the notice period (or the remainder of such period). The Company will have

regard to the need to mitigate the costs for the Company, such that payments would be reduced or cease if departing Executive Directors secure alternative paid employment during

the notice period.

Notice (or payment in lieu) will not be payable in certain circumstances, including where an Executive Director is guilty of (i) wilfully neglecting their duties, or (ii) committing any

serious or persistent breach of their service agreement or (iii) gross misconduct.

AIP

There is no contractual right to any bonus in the event of a notice of termination being given or received on or before the date on which the bonus would otherwise have been paid,

although the Remuneration Committee may exercise its discretion to pay such a bonus, taking into account the time worked in the performance year and based on the individual’s

contribution.

PSP

There is no contractual right to any long-term incentive award in the event of a notice of termination being given or received on or before the date on which the long-term incentive

award would have been made, although the Remuneration Committee may exercise its discretion to make such an award, taking into account the time worked in the performance

period and based on the individual’s contribution.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Element

Approach

Unvested DABP awards

A DABP award will vest in full on the normal vesting date as if the participant had not ceased to be an employee or Director unless the Committee determines that the DABP award

will vest in its entirety on a different date.

If a participant leaves for gross misconduct or is summarily dismissed, any DABP awards they hold will immediately lapse.

Unvested PSP awards

PSP awards are governed by the plan rules.

An unvested PSP award will usually lapse when a participant ceases to be an employee or Director.

If, however, a participant ceases to be an employee or Director because of their death, ill-health, injury, disability, redundancy, retirement, the sale of the participant’s employing

company or business out of the Company or in other circumstances at the discretion of the Committee (i.e. they leave as a ‘good leaver’), their PSP award will normally continue to

vest (and be released) on the date when it would have vested (and been released) if they had not ceased to be an employee or Director subject to pro-rating for time, unless the

Committee determines otherwise.

The extent to which PSP awards vest in these circumstances will be determined by the Committee, taking into account the satisfaction of any performance conditions applicable to

PSP awards measured over the original performance period.

The Committee retains discretion, however, to allow the PSP award to vest (and be released) on the individual’s cessation of office or employment or such other date as it decides,

taking into account any applicable performance conditions measured up to such point as it decides. Unless the Committee decides otherwise, the extent to which a PSP award vests

will also take into account the proportion of the performance period (or, in the case of a PSP award not subject to performance conditions, the vesting period) which has elapsed on

the cessation.

If a participant ceases to be an employee or Director during a holding period in respect of a PSP award their PSP award will normally be released at the end of the holding period.

Post-departure benefits

Executive Directors can be provided certain benefits after departure for those who depart under good leaver provisions, in accordance with the terms of the policy.

Benefits may include, but are not limited to, medical coverage, home security, tax return preparation assistance and legal expenses.

Other

Awards under the all-employee share plans will be treated in line with the plan rules.

Where an Executive Director has been relocated as part of their employment, the Committee retains the discretion to pay the repatriation costs. This may include, but is not restricted

to, airfare, accommodation, shipment, storage, utilities, and any tax and social security that may be due in respect of such benefits.

Except in the case of gross misconduct or resignation, an Executive Director may also receive reasonable retirement gifts.

The Committee retains the discretion to make payments (including professional and outplacement fees) in connection with an Executive Director’s cessation of office or employment.

This may include payments that are made in good faith in discharge of an existing legal obligation (or by way of damages for breach of such an obligation) or by way of settlement of

any claim arising in connection with the cessation of that Executive Director’s office or employment.

Change of control

In the event of a change of control, outstanding awards will be treated in line with the provisions set out in the respective plan rules.

Payment for loss of office

continued

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Fees for Chair of the Board and Non-Executive Directors

Element

Details

Purpose and link to strategy

To provide fees at an appropriate level to attract individuals of the highest calibre with relevant experience to develop, monitor and oversee the Company’s strategy.

Operation

The fees for each Non-Executive Director and the Chair are reviewed annually (but with no obligation to increase them). Non-Executive Directors are not eligible to participate in any

pension or share scheme operated by the Company or to receive any bonus. Additional fees may be payable to reflect additional Board responsibilities, such as committee chairship

and membership, or the role of Senior Independent Director or Workforce Engagement Director.

Each Non-Executive Director including the Chair is entitled to be reimbursed for reasonable and properly documented expenses necessarily incurred in the proper performance of

their duties.

Each Non-Executive Director and the Chair has the benefit of:

—

a personal accident insurance policy maintained by the Company;

—

Directors’ and Officers’ liability insurance maintained by the Company; and

—

the indemnity provided by the Company in the form provided to all Directors.

The Company covers associated tax and social security contributions due on reimbursed expenses that are deemed taxable.

Each Non-Executive Director and the Chair is subject to confidentiality undertakings and a non-compete restrictive covenant.

Non-Executive Directors and the Chair are encouraged to build up a personal holding in the shares of the Company equal to the value of one year of their annual base fee.

Opportunity

When reviewing the level of fees, the assessment will normally consider whether, individually and in aggregate, they remain competitive and appropriate in light of changes in roles,

responsibilities and/or time commitment of the Non-Executive Directors, and to ensure that individuals of the appropriate calibre are retained or appointed.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Annual Report on Remuneration

Planned implementation for 2026

Content within a box indicates that all the information in the panel is planned for

implementation in 2026.

‘Single figure’ of remuneration — Executive Directors

The following table shows a single total figure of remuneration for each Executive Director in

respect of qualifying services for the 2025 and 2024 financial years.

£000

Brian

McNamara

2025

Brian

McNamara

2024

Dawn Allen

2025

Dawn Allen

2024

Salary

1,341

1,292

749

133

Benefits

135

122

Pension

Total fixed remuneration

1,570

1,504

834

157

AIP

1,290

1,520

709

150

PSP

2,3

5,370

6,208

–

Other

–

1,513

2,127

Total variable remuneration

6,660

7,728

2,222

2,277

Total remuneration

8,230

9,232

3,056

2,434

The value of the 2025 AIP includes both the cash (50% of the AIP) and deferred portion (50% of the AIP). The deferred

portion of the bonus is subject to malus and clawback in accordance with the malus and clawback policy, but no further

performance conditions.

2024 column shows the 2022-24 PSP awards which vested in March 2025. The value of awards has been restated to show

the actual share price at vesting of £3.87 and includes the accumulated dividends delivered in the form of shares. Due to the

share price appreciation over the vesting period, the value of the 2022-24 PSP award is higher than the value at grant by

£1,750,613 for Brian McNamara. No discretion has been exercised as a result of the share price change.

2025 column shows the value of the 2023–25 PSP awards which will vest in March 2026 calculated based on the average

share price over the last three months of 2025 of £3.59. The actual value of vesting PSP awards, based on the share price on

the vesting date will be shown in the 2026 Directors’ Remuneration Report. Due to the share price appreciation over the

vesting period, the estimated value of the 2023–25 PSP award is higher than the value at grant by £507,232 for Brian

McNamara. The value of Tobias Hestler’s 2023–25 PSP award, as well as the amount attributable to share price appreciation,

are disclosed under ‘payments to past Directors’ on page 97 of this Report. No discretion has been exercised as a result of

the share price change.

Other remuneration for Dawn Allen in 2024 and 2025 includes cash awards as well as share awards with and without

performance conditions made on appointment. These awards were made to compensate the value foregone on termination

of her employment with Tate & Lyle. The full details of appointment awards were disclosed in the 2024 Annual Report. The

details of the PSP award that vested in June 2025 are set out on page 96 of this Report. The value of this award is calculated

using share price on the vesting date (£3.76). The amount attributable to share price appreciation in relation to this award is

£3,218. In relation to Dawn’s buyout award vesting in June 2026 set out on page 96, due to the share price depreciation over

the vesting period, the estimated value at vesting is lower than the value at grant by £40,384.

2024 remuneration for Dawn Allen shows amounts paid in respect of the period of her employment (28 October –

31 December 2024).

Each remuneration element is rounded to the nearest £1,000, and totals reflect the sum of these rounded values.

Salary

Executive Directors received a 3.5% salary increase in April 2025 in line with the average

increases awarded to the wider UK workforce.

Executive Director

Annual base salary as of

1 January 2025

Annual base salary as of

1 April 2025

Brian McNamara

£1,306,250

£1,351,969

Dawn Allen

£730,000

£755,550

2026 salaries

In determining whether salary increases should be awarded to Executive Directors, the Committee

carefully considered investors’ expectations, the external environment, company performance, salary

increases for the wider workforce, personal performance and competitive market positioning against

the FTSE 30 (excluding financial services) and large international FMCG companies peer groups

. The

Committee approved a 2026 salary increase of 3.2% for the Executive Directors, in line with the wider

UK workforce.

Executive Director

Annual base salary from

1 April 2026

% increase

Brian McNamara

£1,395,232

3.2%

Dawn Allen

£779,728

3.2%

In 2025 this group included Associated British Foods, AstraZeneca, Bayer, British American Tobacco, Burberry Group,

Diageo, GSK, Heineken N.V., Imperial Brands, Reckitt Benckiser Group, Siemens Healthineers AG, Unilever and

Vodafone Group.

Benefits

2025 benefits for Executive Directors included family private healthcare, death in service, income

protection, financial planning, car travel, reimbursement of business expenses deemed to be

taxable benefits, and (for the CEO only) home security services. Executive Directors are eligible

to participate in the HMRC approved Haleon Sharesave Plan and Share Reward Plan.

2026 benefits

Benefits for 2026 remain in line with the Policy.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Pension

Executive Directors receive pension contributions at the rate of 7% of annual base salary which

can include contributions to the pension plan as well as cash allowances. Executive Directors do

not participate in defined benefit pension plans.

Executive Director

Pension plan

contributions

Pension

allowance

Total 2025

pension

contributions

Brian McNamara

£0

£93,838

Dawn Allen

£0

£52,441

2026 Pension

Pension for 2026 remains in line with the Policy and with the broader workforce.

2025 Annual Incentive Plan (AIP) awards (audited)

80% of the bonus opportunity is determined by financial performance and 20% is based upon

the achievement of IBOs.

The figures below represent the total 2025 AIP awards to be paid, including the portion payable

in cash in 2026, and the 50% portion deferred into Haleon shares for a further three years to

2029, subject to continued employment and malus and clawback provisions.

2025 AIP outcome

The AIP outcomes were 47.7% of maximum for the CEO and 46.9% of maximum for the CFO.

Performance

measure

Threshold

Target

Maximum

Outcome

(% of max)

Organic revenue

growth (40%)

11.6%

Organic operating

profit growth (40%)

23.6%

Individual business

objectives (20%)

Details of performance

are set out to the right

Brian

McNamara

12.5%

Dawn

Allen

11.7%

AIP award (% of maximum)

47.7%

46.9%

AIP award (value)

£1,289,778

£708,706

Achieved

Following the change in accounting approach in 2024, Haleon now follows hyper-inflation

standards, whereby inflation impacts above a threshold for specific countries are removed

Actual 3.0%

2.5%

5.5%

8.5%

5.8%

9.8%

13.8%

Actual 10.5%

Directors’ Remuneration Report

continued

from both targets and actual outcomes. Given this change in approach and having considered

wider business performance, there is no discretion applied to the formulaic result for the 2025

AIP outcome.

Achievement of 2025 individual business objectives (IBOs) (audited)

20% of the Executive Directors’ 2025 AIP is linked to the achievement of IBOs which were

focused on key strategic objectives. In addition to the objectives outlined, there is an

expectation that the Executive Directors will each demonstrate the required high leadership

standards and behaviours of the Company.

The table below summarises performance against the key 2025 IBOs for the CEO and CFO:

Brian McNamara

Objective

Description of performance

Gross Margin

Deliver Gross Margin outcome ahead

of Business Plan target and deliver

simplification outcomes

—

Gross margin performance of 64.2% was ahead of

expectations, supported by a robust multi-year supply chain

savings plan through simplifying SKUs formulations and

packaging, providing funds to invest to drive growth.

Operating Model

Design an enterprise operating model

for Haleon to fully realise the Win as

One strategy as presented at the Capital

Markets Day

—

Completed a comprehensive strategic review and designed

a new category-led operating model, consolidating from

three regions and 14 business units to six operating units.

—

All Executive Committee members in place and announced

on 8 January 2026.

Portfolio Review

Carry out a strategic review of the

portfolio and secure Board approval

—

During the year the CEO co-led a strategic review of the

Group’s portfolio which was subsequently reviewed and

approved by the Board.

Recognising Brian’s performance during 2025, the Committee judged that 12.5% of a maximum of 20%

attributable to IBOs was appropriate.

Dawn Allen

Objective

Description of performance

Gross Margin

Deliver Gross Margin outcome ahead

of Business Plan target and deliver

simplification outcomes

—

Gross margin performance of 64.2% was ahead of

expectations, supported by a robust multi-year supply

chain savings plan through simplifying SKUs formulations

and packaging, providing funds to invest to drive growth.

Portfolio Review

Carry out a strategic review of the portfolio

and secure Board approval

—

During the year the CFO co-led a strategic review of the

Group’s portfolio which was subsequently reviewed and

approved by the Board.

Productivity

Drive overall productivity programmes to fuel

growth

—

Completed previously announced £300m productivity

programme and developed roadmap to drive future agility

and efficiency across the organisation.

Recognising Dawn’s performance during 2025, the Committee judged that 11.7% of a maximum of 20%

attributable to IBOs was appropriate.

Haleon

Annual Report and Form 20-F 2025

Deferral policy for the 2025 AIP

In line with the Policy, 50% of the 2025 AIP awards (to be paid in March 2026) will be deferred

for three years into conditional awards over Haleon shares, subject to continued employment

and malus and clawback provisions. These deferred bonus awards are expected to be granted

in March 2026 and will be disclosed in the 2026 Directors’ Remuneration Report.

Deferred Annual Bonus Plan (DABP) awards in respect of the 2024 AIP made in 2025

(audited)

The following table sets out details of the mandatory deferral into the DABP of 50% of the 2024

AIP awards made on 19 March 2025:

Executive Director

Type of award

Nature of award

Number of shares

subject to award

Grant price

Face value at

grant

Brian McNamara

DABP

Conditional

194,833

3.90

£759,846

Dawn Allen

DABP

Conditional

19,198

3.90

£74,870

Grant price is calculated as the average closing share price over the three business days immediately preceding the

grant date.

2026 AIP awards

In line with the Policy, for 2026 the target and maximum AIP opportunities for our Executive

Directors will be:

Executive Director

Target

opportunity

(% of salary)

Maximum

opportunity

(% of salary)

Brian McNamara

100%

200%

Dawn Allen

100%

200%

Performance will be based on Group financial performance targets aligned to the Group’s

KPIs, as well as IBOs. The 2026 AIP measures will remain unchanged from 2025, however, as

described on page 78, the weighting of the two financial measures will be rebalanced to

strengthen the focus on growth. The 2026 AIP performance measures will be: Organic

revenue growth (50%), Organic operating profit growth (30%) and Individual business

objectives (20%).

2026 AIP targets are considered commercially sensitive and will be disclosed in the 2026

Annual Report.

In line with the Policy, 50% of all 2026 AIP awards will be deferred for three years into

conditional awards over Haleon shares, subject to continued employment, malus and

clawback provisions. From 2026 Brian McNamara is expected to have reached his share

ownership requirement, and, subject to this remaining the case, his 2026 AIP would not be

subject to mandatory deferral.

2023–25 Performance Share Plan awards vesting (audited)

The 2023–25 Haleon Performance Share Plan awards are due to vest in March 2026, by reference

to the performance period ended on 31 December 2025. As disclosed in the 2023 Annual

Report, performance measures for the awards were cumulative free cash flow (50%), net debt/

adjusted EBITDA (50%) and the ESG qualifier.

2023–25 PSP awards

2023–25 Haleon PSP awards will vest in March 2026 at 82% of maximum, in line with performance

against the cumulative free cash flow, net debt/adjusted EBITDA targets and ESG qualifier.

Performance

measure

Minimum

Maximum

Outcome

(% of max)

Cumulative free cash

flow (50%)

50%

Net debt/adjusted

EBITDA (50%)

32%

Carbon reduction

(qualifier)

At least 48% reduction in Scope 1 and 2

carbon emissions from the 2020 level.

55%*

Achieved

Recycle-ready

packaging (qualifier)

At least 80% of packaging should be

recycle-ready.

80%*

Achieved

Gender representation

(qualifier)

At least 45% of leadership roles should be

held by women.

46.8%*

Achieved

PSP award (value)

Dawn Allen:

£1,000,440

Brian McNamara

£5,369,537

Achieved

Note:

Dawn Allen, Chief Financial Officer, joined Haleon in November 2024 and was granted a buyout award vesting in June

2026 linked to the 2023-25 PSP performance conditions.

Note:

Straight-line interpolation is applied for performance between minimum and maximum.

Note:

Standard hyperinflation capping approach has been used when calculating the outcomes.

This outcome includes an adjustment to exclude the impact of a change in the Company’s

dividend policy. As the payment of higher dividends was considered to be in the best interests

of shareholders and was not anticipated at the time targets were set, the Committee determined

that it was appropriate to exclude the impact of this change from the vesting outcome.

This adjustment increased the formulaic outcome by c.7% of the maximum opportunity. The

Committee is satisfied that the vesting outcome is reflective of broader underlying business

performance. The Committee also considered progress made during the performance period

on carbon reduction, recycle-ready packaging and gender representation for the 2023–25

performance period when determining the vesting outcome.

* KPMG LLP has issued independent limited assurance over the selected data indicated using assurance standards ISAE(UK)

3000 and ISAE3410.

Actual £5.672bn

£4,520bn

£5,520bn

2.7x

2.3x

Actual

2.49

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

As all thresholds have been met and the Committee was satisfied that broader plans to meet

Haleon’s responsible business commitments were on track (see page 15), no reduction was

applied to the level of vesting shown below.

Executive Director

Number of

awarded

Dividend

equivalents

accrued over the

performance

period

Type of award

Percentage

of the

PSP award

vesting

Number of

vesting

Value of

vesting

Brian McNamara

1,741,487

84,971

Ordinary shares

82%

1,497,695

£5,369,537

Dawn Allen

334,272

6,029

Ordinary shares

82%

279,047 £1,000,440

The value of shares vesting is based on the average share price during last three months of 2025 at £3.59.

Due to the share price appreciation over the vesting period, the estimated value of the 2023–25

PSP awards is higher than the value at grant by £507,232 for Brian McNamara and lower than the

value at grant by £40,384 for Dawn Allen. The value of the PSP award that vested for Tobias

Hestler is disclosed under ‘payments to past Directors’ on page 97 of this Report.

Buyout award vested in June 2025 – Dawn Allen

As described in the 2024 Annual Report, Dawn Allen was granted a PSP award which vested in

June 2025 and was linked to the performance outcome of the original Tate & Lyle award. The

vesting outcome of this award was 38%, as disclosed in the Tate & Lyle Annual Report. The resulting

number of shares and value of award that vested for Dawn Allen is set out in the table below.

Executive Director

Number of

awarded

Dividend

equivalents

accrued over the

performance

period

Type of award

Percentage

of the

PSP award

vesting

Number of

vesting

Value of

vesting

Dawn Allen

355,191

4,095

Ordinary shares

38%

136,529

£512,854

The value of shares vesting is based on the average share price during last three months of 2025 at £3.59.

Performance Share Plan awards made in 2025 (audited)

Brian McNamara was made an award with a face value of 450% of salary. Dawn Allen was made

an award with a face value of 350% of salary. The following table sets out details of awards

made in 2025:

Executive Director

Date of

grant

End of the

performance

period

Type of

award

Nature of

award

Number

of shares

subject to

award

Grant

price

Face value

at grant

Brian McNamara

19 March

2025

31 December

2027

PSP

Conditional

1,507,212

£3.90

£5,878,125

Dawn Allen

19 March

2025

31 December

2027

PSP

Conditional

655,129

£3.90

£2,555,000

Grant price is calculated as the average closing share price over the three business days immediately preceding the grant date.

Performance measures for the PSP awards granted in 2025

As disclosed in the 2024 Annual Report, performance measures for the 2025-27 PSP awards

included cumulative free cash flow (50%), adjusted diluted EPS growth (30%) and organic

operating margin improvement (20%).

Measure

Weighting

Target ranges

Minimum

(25%

vesting)

Maximum

(100%

vesting)

Cumulative free cash flow

(Measured on a cumulative basis over the performance period 2025-27)

50%

£5.345bn

£6.545bn

Adjusted diluted EPS growth

(Measured as % growth on a cumulative basis over three years)

30%

8% p.a.

14% p.a.

Organic operating margin improvement

(Measured as bps improvement on a cumulative basis over three years)

20%

+185 bps

+355 bps

Straight-line interpolation is applied for performance between minimum and maximum.

An ESG qualifier is also included within the 2025 PSP design, to reflect commitments that the

Company has made on carbon reduction and the use of plastic. Haleon is committed to being an

inclusive organisation that represents the consumers and communities who rely on our brands.

This commitment has not changed, however to ensure continued compliance with requirements

in countries in which we operate we have modified the ESG qualifier to remove the gender

representation threshold from 2025 PSP awards. The Committee will keep this decision

under review.

At the end of the performance period, if any of the thresholds are missed, a reduction in the level

of vesting of 10% could be applied for each missed threshold. In addition, if the metrics are

static or go backwards compared to the 2024 baseline, a 25% reduction in the level of vesting

could be applied for each measure (i.e. a potential overall reduction of up to 50%).

The ESG qualifier thresholds for the 2025 PSP are as follows:

Measure

Threshold

Carbon reduction

(Measured for 12 months to November 2027)

At least 59% reduction in Scope 1 and 2 carbon

emissions

Reduction in virgin petroleum-based packaging

(Measured for 12 months to June 2027)

At least 15% reduction in virgin petroleum-based

packaging

In determining the vesting levels and any adjustment which should apply, the Committee will

also consider wider factors, including whether broader plans to meet Haleon’s responsible

business commitments are on track. The Committee will consider all applicable legal and

regulatory requirements when making its decision.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Performance Share Plan awards to be made in 2026

Brian McNamara and Dawn Allen will be granted awards with a face value of 450% of salary

and 350% of salary respectively.

Performance measures for the 2026–28 PSP awards

Measure

Weighting

Target ranges

Minimum

(25%

vesting)

Maximum

(100%

vesting)

Cumulative free cash flow

(Measured on a cumulative basis over the performance period 2026–28)

50%

£5.330bn

£6.530bn

Adjusted diluted EPS growth

(Measured as % growth on a cumulative basis over three years)

30%

8% p.a.

14% p.a.

Organic operating margin improvement

(Measured as bps improvement on a cumulative basis over three years)

20%

+265bps

+435bps

Straight-line interpolation is applied for performance between minimum and maximum.

The Committee reviews the mix of measures in incentives on an annual basis and will continue

to consider whether the performance measures remain aligned with our strategic priorities.

An ESG qualifier is also included within the 2026 PSP design, to reflect commitments that the

Company has made on carbon reduction and the use of plastic.

At the end of the performance period, if either of the thresholds are missed, a reduction in the

level of vesting of 10% could be applied for each missed threshold. In addition, if the metrics

are static or go backwards compared to the 2025 baseline, a 25% reduction in the level of

vesting could be applied for each measure (i.e. a potential overall reduction of up to 50%).

The ESG qualifier thresholds for the 2026–28 PSP are as follows:

Measure

Threshold

Carbon reduction

(Measured for 12 months to November 2028)

At least 68% reduction in Scope 1 and 2 carbon

emissions

Reduction in virgin petroleum-based packaging

(Measured for 12 months to June 2028)

At least 20% reduction in virgin petroleum-based

packaging

In determining the vesting levels and any adjustment which should apply, the Committee will

also consider wider factors, including whether broader plans to meet Haleon’s responsible

business commitments are on track.

Payments for loss of office (audited)

There were no payments for loss of office during 2025.

Payments to past Directors (audited)

On 1 November 2024, Tobias Hestler stepped down from his position as the CFO. His

remuneration arrangements on termination were disclosed in the 2024 Annual Report.

The table below provides a summary of his termination payments:

Element

Value

Payment in lieu of notice

£226,953

Benefits

£100

The following table shows the details of vesting of his 2023–25 PSP award which was pro-rated

for the time that he was employed. Performance targets and assessment are presented on

pages 95 and 96 of this Report.

Executive Director

Number of

shares awarded

Dividend equivalents

accrued over the

performance period

Type

of award

Percentage of

the PSP award

vesting

Number

of shares

vesting

Value of shares

vesting

Tobias Hestler

758,514

31,230

Ordinary

82%

384,064

£1,376,945

2023–25 PSP awards were pro-rated by reference to the vesting period for all eligible early leavers. As Tobias Hestler

remained employed until 31 December 2024, his award was pro-rated to 59%. The value of shares vesting is based on the

average share price during the last three months of 2025 of £3.59.

Due to the share price appreciation over the vesting period, the estimated value per share of the

2023-25 PSP awards is higher than the value per share at grant by £131,025 for Tobias Hestler.

Total shareholder return (TSR)

The chart shows the monthly value, from the time of demerger to 31 December 2025, of a

notional sum of £100 invested in Haleon shares on 18 July 2022, compared to £100 invested in

the FTSE 100 on the same date. The FTSE 100 Index was chosen as the comparator because the

Company is a constituent of this index.

Haleon PLC

Jul 22

Jan 23

Jan 24

Jul 23

Jul 24

Jan 25

Jan 26

Jul 25

TSR (Rebased to 100)

100

120

140

160

FTSE 100

Large international FMCG companies

Note:

To provide shareholders with additional context, the chart also shows a bespoke group of large international FMCG

companies: Diageo, AstraZeneca, GSK, British American Tobacco, Vodafone Group, Imperial Brands, Danone S.A.,

Heineken N.V., Burberry Group, Associated British Foods, L’Oréal S.A., Pernod Ricard SA, Sanofi and Siemens

Healthineers AG.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Chief Executive Officer — historical remuneration information

The table below shows the remuneration of the Chief Executive Officer in place at the time over

the same period.

Year

2022

2023

2024

2025

Chief Executive Officer

Brian

McNamara

Brian

McNamara

Brian

McNamara

Brian

McNamara

Single figure of total remuneration (£’000)

2,294

5,823

9,062

8,230

AIP outcome (% of maximum)

72%

75%

58%

48%

PSP vesting (% of maximum)

n/a

81%

76%

82%

Pre-demerger remuneration for Brian McNamara was set in US Dollars and has been converted to GBP in the table above,

using the average 2022 exchange rate of 1.24.

2022 AIP value has been pro-rated for the period between Director’s appointment (23 May 2022) and the end of the

financial year (31 December 2022).

There were no PSP awards vesting in 2022.

Relative importance of spend on pay

The table below sets out the amounts payable in respect of 2024 and 2025 on all-employee pay

and dividends:

Year

2024

2025

% change

Total staff costs

£2,170m

£2,035m

-6%

Dividends

£570m

£612m

Total staff costs are presented in line with Note 7 to the Financial Statements.

Dividends are presented in line with Note 10 to the Financial Statements.

Chief Executive Officer’s pay compared with employee pay

The table below compares the CEO’s ‘single figure’ of total remuneration to that received by

three representative UK employees in 2025, 2024, 2023 and 2022. The total remuneration for

each quartile employee, and the salary component within this, are also outlined below.

Year

Method

25th percentile

pay ratio

Median

pay ratio

75th percentile

pay ratio

2025

Option B

131:1

76:1

52:1

2024

Option B

144:1

84:1

63:1

2023

Option B

94:1

51:1

38:1

2022

Option B

64:1

32:1

24:1

2024 CEO single figure has been recalculated based on the restated value of the 2022-24 PSP award at vesting.

2023 CEO single figure includes the value of the PSP Refill award which was made to compensate the value foregone on

early vesting of the GSK award. This award vested in March 2024.

2022 CEO single figure does not include any long-term incentive component as the first Haleon PSP award was made to the

CEO in 2022. The total 2022 remuneration for employees is based on earnings between 23 May 2022 and 31 December 2022

and the 2022 bonus pro-rated for that period.

See Methodology below.

Year

25th percentile

£000

Median

£000

75th percentile

£000

2025 salary

2025 total remuneration

108

159

Methodology

In line with the approach taken in previous years, we have chosen to use Option B as our

preferred methodology to calculate the CEO pay ratio. Given the complexity of the pay

arrangements for different categories of UK employees at Haleon, this approach allows us to

leverage the existing gender pay gap calculations and thus presents a practical and efficient

approach, using robust and meaningful data that is representative of the remuneration levels

for UK employees.

The Company used data from the 2025 UK gender pay gap calculation to determine employees

positioned at each pay quartile and excluded those employees who left the Company before

31 December 2025. Remuneration was calculated in line with the methodology used to

determine the single total figure of remuneration for the CEO, as presented in this Report.

Remuneration figures are determined with reference to the financial year ending on 31 December

2025. The remuneration covers salary, benefits and pension contributions, bonus in respect

of 2025 which will be paid in March 2026 and share awards without performance conditions

granted in 2025. No components were omitted from the calculation and no adjustments were

made to any of the pay elements. Where required, actual remuneration was converted into a

full-time equivalent by pro-rating earnings to reflect full-time contractual working hours.

The Committee determined that the identified employees are reasonably representative of the

pay quartiles, since the structure of their remuneration arrangements is in line with that of the

majority of employees in the UK. The Committee believes that the median pay ratio for the 2025

financial year is consistent with the pay, reward and progression policies for the Company’s

UK employees.

The change in the CEO pay ratio between 2022 and 2023 is primarily attributed to the vesting of

the Haleon PSP Refill award that was made to compensate the proportion of GSK awards that

lapsed on demerger awards for the CEO whereas the 2022 single figure of remuneration did not

include any long-term incentive awards. The change between 2023 and 2024 reflects the vesting

of the first full cycle of the Haleon PSP for the CEO. The change between 2024 and 2025 is

primarily attributable to a change in the share price used to value the PSP award which is

included in the single figure table for the CEO.

Directors’ Remuneration Report

continued

Haleon

Annual Report and Form 20-F 2025

Percentage change in remuneration

The table below sets out the change in remuneration for each Director between 2022 and 2025 compared to a wider UK employee comparator group:

Change in 2023 against 2022

Change in 2024 against 2023

Change in 2025 against 2024

Salary/fees

(% change)

Benefits

(% change)

Bonus

(% change)

Salary/fees

(% change)

Benefits

(% change)

Bonus

(% change)

Salary/fees

(% change)

Benefits

(% change)

Bonus

(% change)

Executive Directors

Brian McNamara

–52%

4.5%

–29%

–19%

3.8%

11%

-15%

Tobias Hestler

4.5%

–11%

–23%

n/a

Dawn Allen

n/a

463%

120%

372%

Chair and Non-Executive Directors

Sir Dave Lewis

19%

n/a

4.5%

208%

n/a

-7%

n/a

Manvinder Singh (Vindi) Banga

–52%

n/a

2.9%

116%

n/a

-45%

n/a

Nancy Avila

n/a

209%

n/a

Marie-Anne Aymerich

191%

n/a

3.4%

–47%

n/a

180%

n/a

Bláthnaid Bergin

n/a

Tracy Clarke

–89%

n/a

3.2%

306%

n/a

164%

n/a

Dame Vivienne Cox

–87%

n/a

3.4%

490%

n/a

-29%

n/a

David Denton

n/a

Asmita Dubey

–35%

n/a

4.5%

–73%

n/a

99%

n/a

Matt Shattock

n/a

Deirdre Mahlan

146%

n/a

3.2%

–84%

n/a

Alan Stewart

n/a

230%

301%

n/a

Bryan Supran

n/a

–43%

n/a

–96%

n/a

382%

n/a

John Young

–11%

n/a

Average for all UK employees

9,10

35%

25%

4.5%

53%

–29%

3.5%

-4%

Change in salary/fees for Directors in 2022/23 is shown as the change from the post-demerger annual rate of salary applicable for 2022 to the rate applicable for 2023.

Change in benefits for Directors in 2022/23 is shown as annualised value of post-demerger benefits for 2022 compared with the full value of benefits in 2023.

Change in bonus for the Executive Directors in 2022/23 is shown as the annualised value of the post-demerger 2022 AIP compared with the full value of the 2023 AIP. In 2023/24 change in bonus for Tobias Hestler is shown based on his full 2024 AIP,

whereas the amount in the single figure table has been pro-rated to reflect him stepping down from the Board on 1 November 2024.

Dawn Allen joined the Board on 1 November 2024. Change in remuneration is presented based on the values reported in the single figure table, these values have not been annualised.

Nancy Avila and Alan Stewart joined the Board on 1 September 2024. Change in remuneration is based on the change in amounts as disclosed in the single figure table.

Bláthnaid Bergin joined the Board on 24 February 2025. Matt Shattock joined the Board on 1 June 2025. Change in remuneration is based on the change in amounts as disclosed in the single figure table.

Non-Executive Director fees for David Denton and Bryan Supran were waived. David Denton joined the Board with effect from 1 March 2023 and stepped down on 4 December 2024. Deirdre Mahlan stepped down from the Board on 1 October 2024.

Bryan Supran stepped down from the Board on 25 February 2025. Change in remuneration is based on the change in amounts as disclosed in the single figure table.

John Young stepped down from the Board with effect from 28 February 2023 and Deirdre Mahlan stepped down from the Board on 1 October 2024. Change in remuneration is based on the change in amounts as disclosed in the single figure table.

Only a very small number of individuals are employed by the same entity as Directors. As the number of employees is fewer than five, data for this entity is not presented. Therefore, the table above shows a comparison to the average remuneration for all

UK employees of Haleon.

10.

Average change in salary for the UK employees is the average increase awarded to the UK workforce. Average change in benefits for the UK employees for 2022/23 represents a change in the medical benefit offering in the UK between 2022 and 2023 which

resulted in an increase in the average monthly premium. Average change in benefits for the UK employees for 2023/24 represents an introduction of London travel allowance from August 2024 due to change in the office location. Average change in bonus

for the UK employees for 2023/24 was restated based on the actual bonus data. Average change in bonus for the UK employees for 2024/25 is calculated as the change in the business multiplier between 2024 and 2025.

11.

Average change in salary/fees, benefits and bonus for Directors for 2024/25 is presented based on the values reported in the single figure table. These values have not been annualised.

Corporate

Governance

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Consideration of workforce pay and approach to engagement

The Board receives regular updates on employee engagement, including employee engagement

survey results, with a detailed update presented annually. Workforce engagement is covered

on page 69, which includes commentary on how the views of employees were considered by

the Board.

To ensure that the remuneration-related decisions are fair and appropriate, the Committee

considered employees’ pay increases when determining the appropriate salary levels for the

Executive Directors and fees for the Chair. In addition, the Committee was provided with an

update on bonus outcomes for the wider employee population, which were taken into account

to ensure that the bonus outcomes appropriately reflect business performance at all levels in the

organisation. In 2025, the Workforce Engagement Director, Dame Vivienne Cox, conducted a

series of meetings with various groups of employees. She covered the role of the Board and the

Committee, setting out how the Remuneration Committee operates and how it considers wider

workforce remuneration arrangements.

The Directors’ Remuneration Policy is available on Haleon’s website, providing an opportunity to

view and assess the remuneration structure which applies to the Board. The Company always

welcomes employee feedback, and views on executive remuneration will be shared with the

Committee.

Remuneration Committee advisers

During 2025, PwC was the independent remuneration adviser to the Committee, having been

appointed by the Committee in August 2022. PwC is a member of the Remuneration Consultants’

Group and voluntarily operates under their code of conduct when providing advice on executive

remuneration in the UK. PwC regularly meets with the Chair of the Committee without

management present. The Committee is comfortable that the PwC engagement partner and

team providing remuneration advice to the Committee do not have connections with Haleon or

its individual Directors that may impair their independence and objectivity. The total fees paid to

PwC for the provision of independent advice to the Committee in 2025 were £153,046 excluding

VAT charged on a fixed fee as well as time and materials basis. During 2025, PwC also provided

other services to Haleon entities, relating to tax advice, broader advisory support, controls,

general management consultancy, cyber security, deals and transactions work . Remuneration

advice is provided by an entirely separate team within PwC.

Statement of voting at the Annual General Meeting (AGM)

The Directors’ Remuneration Policy was approved by shareholders at the 2023 AGM and the

2024 Directors’ Remuneration Report was approved by shareholders at the 2025 AGM. Each of

these resolutions received a significant vote in favour by shareholders and the Committee is

grateful for this support and endorsement by our shareholders. The votes received were:

Resolution

For

Against

Withheld

To approve the 2024 Directors’

Remuneration Report

7,428,243,215

98.73%

95,579,831

1.27%

59,533,076

To approve the Directors’

Remuneration Policy

7,728,166,817

98.19%

142,531,194

1.81%

35,150,085

‘Vote withheld’ is not a vote in law and is not counted in the calculation of the votes ‘For’ or ‘Against’ a resolution.

Directors’ service contracts and letters of appointment

Brian McNamara’s and Dawn Allen’s service contracts, dated 9 May 2022 and 23 April 2024

respectively, are subject to a 12-month notice period and any payments for loss of office will

be in line with the Directors’ Remuneration Policy. Executive Directors’ service contracts are

available for inspection at the Company’s registered office and included as exhibits to this

Annual Report and Form 20-F. The Non-Executive Directors and the Chair were each

appointed by a letter of appointment for an initial term of three years, and either party may

terminate the appointment on three months’ notice, or, if earlier, with the consent of the Board.

All Non-Executive Directors are subject to annual re-election by shareholders at the AGM and

there is no provision in their letters of appointment giving them a right to compensation upon

early termination.

2025 Non-Executive Directors’ remuneration

The Chair received an annual fee which was set at £757,103 per annum for 2025. The 2025 base

fee for each other Non-Executive Director was £102,750 per annum. Bryan Supran’s fees for

acting as a Non-Executive Director of Haleon plc were waived as he was a Pfizer employee.

Additional fees payable in 2025 were as follows:

— £50,000 per annum for the Senior Independent Director;

— £30,000 per annum for the Workforce Engagement Director;

— £40,000 per annum for chairing the Audit & Risk Committee;

— £40,000 per annum for chairing the Remuneration Committee; and

— £35,000 per annum for chairing the Environmental & Social Sustainability Committee.

Directors’ Remuneration Report

continued

100

Haleon

Annual Report and Form 20-F 2025

2026 Non-Executive Directors’ remuneration

As announced on 10 November 2025, Sir Dave Lewis stepped down as Chair of the Board effective 31 December 2025 and Vindi Banga succeeded Dave with effect from 1 January 2026.

The Committee approved the fee level for our new Chair, Vindi Banga, set at a level in line with the previous incumbent. The 2026 base fees for the Chair will increase by 3.2% to £781,330 per

annum from 1 April 2026.

The Board reviewed the Non-Executive Directors’ fees and, at the recommendation of the Chair and the CEO, approved a 3.2% increase to the base fee for the Non-Executive Directors,

bringing the 2026 base fee to £106,038 per annum. No other changes were made to the remuneration of the Non-Executive Directors.

‘Single figure’ of remuneration — Non-Executive Directors (audited)

The table below shows the actual fees paid to our Non-Executive Directors in 2025 and 2024.

Non-Executive Director

2025 fees

(£000)

2025 benefits

(£000)

2025 total

remuneration

(£000)

2024 fees

(£000)

2024 benefits

(£000)

2024 total

remuneration

(£000)

Sir Dave Lewis

751

16.2

767

724

17.4

741

Manvinder Singh (Vindi) Banga

152

0.7

153

148

1.3

149

Nancy Avila

102

3.0

105

0.0

Marie-Anne Aymerich

136

4.5

141

128

1.6

130

Bláthnaid Bergin

0.4

–

Tracy Clarke

142

1.6

144

138

0.6

139

Dame Vivienne Cox

132

1.6

134

128

2.3

130

David Denton

–

1.3

Asmita Dubey

102

1.0

103

0.5

Matt Shattock

1.0

–

Deirdre Mahlan

–

104

2.3

106

Alan Stewart

142

1.2

143

0.3

Bryan Supran

1.4

0.3

Fees and total remuneration have been rounded to the nearest £1,000 for presentation purposes, and totals reflect the sum of these rounded values.

Bláthnaid Bergin joined the Board on 24 February 2025.

Matt Shattock joined the Board on 1 June 2025.

Nancy Avila and Alan Stewart joined the Board on 1 September 2024.

David Denton stepped down from the Board on 4 December 2024.

Deirdre Mahlan stepped down from the Board on 1 October 2024.

Bryan Supran stepped down from the Board on 25 February 2025.

Corporate

Governance

101

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Statement of Directors’ shareholding and share interests (audited)

Total shareholding of Directors on 31 December 2025 is shown below.

Director

Shares beneficially

owned

Shares not subject

to performance

Options not subject

to performance

Shares subject to

performance

Total interest

Share ownership as

% of 2025

salary/fee

Share ownership

requirement

met

Chair

Sir Dave Lewis

94,627

–

94,627

45%

n/a

Executive

Brian McNamara

1,511,626

628,122

5,132,373

7,272,121

490%

Yes

Dawn Allen

180,252

19,544

1,374,467

1,574,263

91%

Non-Executive Directors

Manvinder Singh (Vindi) Banga

329,800

–

329,800

1152%

n/a

Nancy Avila

–

n/a

Marie-Anne Aymerich

50,000

–

50,000

175%

n/a

Bláthnaid Bergin

6,145

–

6,145

21%

n/a

Tracy Clarke

12,504

–

12,504

44%

n/a

Dame Vivienne Cox

–

n/a

Asmita Dubey

15,424

–

15,424

54%

n/a

Matt Shattock

–

n/a

Alan Stewart

34,513

–

34,513

121%

n/a

Bryan Supran

50,000

–

50,000

175%

n/a

Beneficial interest also includes shares held indirectly through Haleon ADSs and shares/ADSs held by connected persons.

Share ownership as % of 2025 salary/fee is based on the average share price over the last three months of 2025 of £3.59. Shares that count towards the requirement include beneficial holdings and unvested DABP shares on an after-tax basis.

Bláthnaid Bergin joined the Board on 24 February 2025.

Matt Shattock joined the Board on 1 June 2025.

Nancy Avila and Alan Stewart joined the Board on 1 September 2024.

Bryan Supran stepped down from the Board on 25 February 2025.

No changes to Directors’ interests in ordinary shares or ADSs occurred between 31 December 2025 and 5 March 2026 (being the last practicable date).

Non-Executive Directors, including the Chair, are encouraged to build up a personal holding in the shares of the Company equal to the value of one year of their annual base fee.

Executive Directors are required to build up significant holdings of shares in Haleon (450% and 350% of salary for the CEO and CFO respectively). Until these requirements have been met, Executive

Directors are required to hold all Haleon shares acquired under the Company’s share plans (net of income tax and National Insurance contributions). Executive Directors must comply with

shareholding requirements for two years after leaving the Company, at a level equal to the lower of their shareholding requirement immediately prior to departure or their actual shareholding on

departure. During this period, former Executive Directors will be required to seek permission to deal from the Company Secretary.

Directors’ Remuneration Report

continued

102

Haleon

Annual Report and Form 20-F 2025

Additional disclosures

Further information is provided on compensation and interests of Directors and senior

management. For the purpose of this disclosure, this group includes the Executive and

Non-Executive Directors and the Executive Team as at 31 December 2025.

The following table sets out aggregate remuneration for this group for 2025.

2025 remuneration

£000

Total compensation paid

22,776

Aggregate increase in accrued pension benefits (net of inflation)

–

Aggregate payments to defined contribution schemes

1,362

During 2025, members of this group were awarded shares and ADSs under the Company’s share

plans, as set out in the table below. To align the interests of senior management with those of

shareholders, Executive Directors and Executive Team members are required to build and

maintain significant holdings of shares in Haleon over time.

Awards

Dividend equivalents

ADSs

Performance Share Plan

6,589,017

244,400

111,412

1,554

Deferred Annual Bonus Plan

214,031

3,861

Share Value Plan

195,617

405,911

Share Reward

1,618

Executive Directors are not eligible to participate in the Share Value Plan.

See Note 26 to the Financial Statements for further details on the Share Reward Plan.

At 5 March 2026 (being the latest practicable date), this group and persons closely associated

with them had the following interests in shares and ADSs of the Company. Interests awarded

under the various share plans are described in Note 26 to the Financial Statements, ‘Employee

share schemes’ on page 161.

Interests as at 5 March 2026

ADSs

Owned

2,892,604

348,174

Unexercised options

6,150

Deferred Annual Bonus Plan

647,666

Performance Share Plan

17,887,708

245,954

Share Value Plan

637,217

405,911

Share Reward

2,278

Executive Directors are not eligible to be granted awards under the Share Value Plan.

Corporate

Governance

103

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Consolidated

Financial Statements

Strategic

Report

Compliance

with the UK

Corporate

Governance

Code

The Board considers that the Company

has applied the principles and complied

fully with the provisions set out in the

2024 UK Corporate Governance Code

(the Code) for the period from 1 January

2025 to 31 December 2025.

An update on planning for the

implementation of Provision 29 of the

Code requiring the Board to make a

disclosure in our 2026 Annual Report

outlining the effectiveness of internal

controls, including a declaration in

relation to material internal controls

is included on page 72.

The table summarises how the principles

of the Code have been applied

throughout this period. It should be read

in conjunction with the Strategic Report

and Corporate Governance section,

including the Directors’ Remuneration

Report.

See also our summary statement outlining

differences between the Group’s UK

corporate governance practices from

those of US companies on page 193.

The Code is published on the FRC website:

www.frc.org.uk

Code principle

Page(s)

Board leadership and company purpose

The Board performance review highlighted that the Board

continues to operate effectively. This is attributed to the diverse

and complementary expertise of the Directors, which promotes

balanced decision-making focused on long-term sustainable

success. Careful procedures manage conflicts of interest should

they arise, including recusal from certain Board discussions

where required.

60, 61,

64, 66,

The Board has agreed the strategic direction of the Group and

monitored the strategy, medium-term plans and evolution of the

culture and values at its meetings during 2025. The Haleon Code

of Conduct was updated in 2025 and training is annually

completed by all Board Directors and employees.

65, 66

The Board monitors performance and KPIs through regular

updates, presentations and deep dives into key areas. It also

oversees the effectiveness of the Group’s risk management

framework. Regular reviews of the Company’s controls and risk

management processes are performed by the Audit & Risk

Committee.

65, 71

Stakeholder engagement activities during the period included

meetings with major institutional shareholders, shareholder

representative bodies and employees (through the Workforce

Engagement Director and employee engagement during local

market visits). The AGM also provides the opportunity for the

Board to engage directly with shareholders.

31, 32,

34, 69

The Board received updates on policies and practices

throughout the period. Any employee can raise matters of

concern confidentially through the Speak Up programme

which is overseen by the Audit & Risk Committee.

65, 71

Division of responsibilities

The Board performance review highlighted that the Chair led the

Board effectively during 2025, demonstrating objective judgement

and promoting a culture of openness and debate.

There is an appropriate balance of Executive and Independent

Non-Executive Directors. There is a clear division of

responsibilities between the Chair and the Chief Executive Officer.

60, 61,

The Non-Executive Directors have diverse backgrounds and

skill sets. The Board performance review affirmed that all

Non-Executive Directors are effective and devote appropriate

time to their duties. The Chair meets regularly with Non-Executive

Directors without Executive Directors present.

60, 61,

The Chair and Company Secretary ensure the Board and its

Committees receive timely, accurate and clear information to

support their decision-making.

64, 67

Code principle

Page(s)

Composition, success and evaluation

Appointments to the Board are led by the Nominations &

Governance Committee, who maintain clear succession plans for

the Directors and Executive Committee members. Directors are

subject to annual re-election at the AGM.

76, 77

The Board skills matrix is maintained and reviewed by the

Nominations & Governance Committee, which also reviews

membership of Board Committees on a regular basis.

76, 77

The Board performance review was conducted internally, and

concluded that the Board operates effectively. The review

confirmed that individual directors continue to contribute

effectively.

Audit, risk and internal control

The Audit & Risk Committee is responsible for assessing the

independence and effectiveness of the external auditor and

the internal audit function. It has reviewed all of the Group’s

published financial and narrative statements.

The Board is satisfied that the Annual Report, taken as a whole,

is fair, balanced and understandable. The viability and going

concern statements specifically cover the Board’s assessment

of the current and future prospects of the Group.

58, 71,

105,

178

The Board and, as appropriate, the Audit & Risk Committee (in line

with its Terms of Reference) has reviewed the principal risks,

monitors risk appetite and oversees the internal control framework.

65, 72

Remuneration

The Remuneration Committee has developed a policy, aligned to

Haleon’s purpose, values and clearly linked to delivery of Haleon’s

long-term strategy, on Executive Director remuneration which will

be submitted to shareholders for their approval at the 2026 AGM.

No Directors are involved in deciding their own remuneration

outcomes. The Remuneration Committee followed a clear process

while developing the Directors’ Remuneration Policy.

79, 80

The Remuneration Committee exercises independent judgement

and considers the application of discretion, permitted when

determining the outcome of performance-related Executive

remuneration.

79, 80,

86, 93,

104

Haleon

Annual Report and Form 20-F 2025

Consolidated

Financial Statements

105

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Statement of

Directors’ responsibilities

Financial Statements and accounting

records

The Directors are responsible for preparing

the Annual Report and the Financial

Statements in accordance with applicable

law and regulations.

Company law requires the Directors to

prepare Financial Statements for each

financial year. The Directors have prepared

the Consolidated Financial Statements in

accordance with United Kingdom (UK)

adopted international accounting standards

in conformity with the requirements of the

Companies Act 2006, and the Parent Company

Financial Statements in accordance with UK

accounting standards. The Consolidated

Financial Statements, also comply with

International Financial Reporting Standards

(IFRS), as issued by the International

Accounting Standards Board (IASB),

including interpretations issued by the

IFRS Interpretations Committee (IFRIC), and

International Financial Reporting Standards.

Under company law directors must not

approve the Financial Statements unless they

are satisfied that they give a true and fair view

of the state of affairs of the Parent Company

and the Group, and the profit or loss for

that period. In preparing these Financial

Statements, the Directors are required to:

— Select suitable accounting policies and

apply them consistently.

— Make judgements and accounting estimates

that are reasonable.

— Provide additional disclosures when

compliance with the specific requirements

of the financial reporting framework are

insufficient to enable users to understand

the impact of particular transactions, other

events and conditions on the entity’s

financial position and financial performance.

— State whether the Consolidated Financial

Statements have been prepared in

accordance with UK-adopted international

accounting standards.

— State for the Parent Company Financial

Statements whether applicable UK

accounting standards, comprising FRS 102,

have been followed.

— Prepare the Financial Statements on the

going concern basis unless it is

inappropriate to presume that the Parent

Company and the Group will continue

in business.

The Directors are responsible for ensuring

that the Parent Company and the Group

keep adequate accounting records that are

sufficient to show and explain the Parent

Company’s and the Group’s transactions

and disclose with reasonable accuracy the

financial position of the Parent Company

and the Group to enable them to ensure that

the Financial Statements comply with the

Companies Act 2006. The Directors also

have responsibility for the system of internal

control, safeguarding the assets of the

Parent Company and the Group, and taking

reasonable steps to prevent and detect fraud

and other irregularities. Under applicable law

and regulations, they also have responsibility

for preparing a Directors’ Report, Strategic

Report, Directors’ Remuneration Report,

and Corporate Governance Statement.

The Directors are responsible for the

maintenance and integrity of the Annual

Report including on Haleon’s website.

Legislation in the UK governing the

preparation and dissemination of financial

statements may differ from legislation in

other jurisdictions.

Disclosure Guidance and Transparency

Rules

The Directors confirm to the best of their

knowledge:

— The Consolidated Financial Statements,

prepared in accordance with a relevant

financial reporting framework, give a true

and fair view of the assets, liabilities,

financial position and profit or loss of the

Parent Company and the undertakings

included in the consolidation taken as a

whole.

— The Annual Report, including the Strategic

Report, includes a fair review of the

development and performance of the

business and the position of the Parent

Company and the Group taken as a whole,

together with a description of the principal

risks and uncertainties that it faces.

— In accordance with Disclosure Guidance

and Transparency Rule (DTR) 4.1.16R, the

financial statements will form part of the

annual financial report prepared under

DTR 4.1.17R and 4.1.18R. The auditor’s

report on these financial statements

provides no assurance over whether the

annual financial report has been prepared

in accordance with those requirements.

UK Corporate Governance Code 2024

The Directors consider that this Annual Report

and Form 20-F taken as a whole, is fair,

balanced and understandable and that it

provides the information necessary for

shareholders to assess the Parent Company’s

and the Group’s position and performance,

business model and strategy.

Disclosure of information to auditors

Each of the Directors who held office as at the

date of approval of this Report confirm that:

— They have taken steps to make themselves

aware of relevant audit information (as

defined by Section 418(3) of the Companies

Act 2006).

— None of the Directors are aware of any

relevant audit information which has not

been disclosed to the Company’s and

Group’s auditor.

For and on behalf of the Board

Brian McNamara

Chief Executive

Officer

13 March 2026

Dawn Allen

Chief Financial

Officer

13 March 2026

106

Haleon

Annual Report and Form 20-F 2025

1. Our opinion is unmodified

In our opinion:

— the financial statements of Haleon plc give a true and fair view of the state of the Group’s

and of the Parent Company’s affairs as at 31 December 2025, and of the Group’s profit for

the year then ended;

— the Group financial statements have been properly prepared in accordance with UK-

adopted international accounting standards;

— the Parent Company financial statements have been properly prepared in accordance with

UK accounting standards, including FRS 102 The Financial Reporting Standard applicable in

the UK and Republic of Ireland; and

— the Group and Parent Company financial statements have been prepared in accordance

with the requirements of the Companies Act 2006.

Additional opinion in relation to IFRS as issued by IASB

As explained in Note 1 to the Group Financial Statements, the Group, in addition to complying

with its legal obligation to apply UK-adopted International Financial Reporting Standards, has

also applied International Financial Reporting Standards (“IFRS”) as issued by the International

Accounting Standards Board (“IASB”).

In our opinion, the Group Financial Statements have been properly prepared in accordance with

IFRS as issued by the IASB.

What our opinion covers

We have audited the Group and Parent Company financial statements of Haleon plc

(“the Company”) for the year ended 31 December 2025 (FY25) included in the Annual Report,

which comprise:

Group (Haleon plc and its subsidiaries)

Parent Company (Haleon plc)

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated balance sheet

Consolidated statement of changes in equity

Consolidated cash flow statement

Notes to the Consolidated Financial Statements,

including the accounting policies in Notes 1 to 3.

Balance sheet

Statement of changes in equity

Notes to the Parent Company Financial Statements,

including the accounting policies in Notes 1 and 2.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs

(UK)”) and applicable law. Our responsibilities are described below. We believe that the audit

evidence we have obtained is a sufficient and appropriate basis for our opinion. Our audit

opinion and matters included in this report are consistent with those discussed and included

in our reporting to the Audit & Risk Committee.

We have fulfilled our ethical responsibilities under, and we remain independent of the Group in

accordance with, UK ethical requirements including the FRC Ethical Standard as applied to listed

public interest entities.

KPMG LLP’s Independent

Auditor’s Report

To the members of Haleon plc

Consolidated

Financial Statements

107

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

2. Overview of our audit

Factors driving

our view of risks

Following our FY24 audit, and considering developments affecting the Group

since then, we have updated our risk assessment decisions.

The macro-economic environment has been a driving factor in our risk

assessment. Whilst inflation rates have generally trended downwards in 2025,

there has been increased economic uncertainty, with factors such as U.S. tariffs

on international imports impacting input costs for the Group.

The Group holds brands with indefinite lives where a high degree of estimation

uncertainty exists with regards to assumptions and estimates used in the

Group’s assessment of the recoverable amount. The key assumption is discount

rate. There is significant auditor judgement involved in evaluating these

assumptions. We identified that the indefinite life brand most sensitive to

possible change in key assumptions used in the valuation models is Preparation

H. The effect of these matters could result in a potential range of reasonable

outcomes greater than our materiality for the Financial Statements as whole.

The investment in subsidiaries in the Parent Company Financial Statements is

material. As a result, this is considered to be the area that has the greatest effect

on our overall Parent Company audit.

Key Audit Matters

Vs FY24

Item

Recoverability of indefinite life brands

4.1

Recoverability of Parent Company’s investment in subsidiaries

4.2

Audit & Risk

committee

interaction

During the year, the Audit & Risk Committee met 6 times. KPMG are invited to

attend all Audit & Risk Committee meetings and are provided with an

opportunity to meet with the Audit & Risk Committee in private sessions without

the Executive Directors being present. For each Key Audit Matter, we have set

out communications with the Audit & Risk Committee in section 4, including

matters that required particular judgement for each.

The matters included in the Audit & Risk Committee Report on page 70 are

materially consistent with our observations of those meetings.

Our

independence

We have fulfilled our ethical responsibilities under, and we remain independent

of the Group in accordance with, UK ethical requirements including the FRC

Ethical Standard as applied to listed public interest entities.

We have not performed any non-audit services during FY25 or subsequently

which are prohibited by the FRC Ethical Standard.

We were first appointed as auditor by the shareholders for the year ended

31st December 2023. The period of total uninterrupted engagement is for three

financial years ended 31st December 2025. The Group engagement partner

is required to rotate every 5 years. As these are the first set of the Group’s

financial statements signed by Jeremy Hall, he will be required to rotate off

after the FY29 audit.

The average tenure of partners responsible for component audits as set out in

section 7 below is 3 years, with the shortest being 1 year and the longest being

4 years.

Total audit fee

£16.5m

Audit related fees (including interim review)

£1.1m

Other services

£nil

Non-audit fee as a % of total audit and audit related fee %

Date first appointed

20th April 2023

Uninterrupted audit tenure

3 years

Next financial period which requires a tender

2033

Tenure of Group engagement partner

1 year

Average tenure of component signing partners

3 years

108

Haleon

Annual Report and Form 20-F 2025

Materiality

(Item 6 below)

The scope of our work is influenced by our view of materiality and our assessed

risk of material misstatement.

We have determined overall materiality for the Group Financial Statements as a

whole at £110m (FY24: £110m) and for the Parent Company Financial

Statements as a whole at £100m (FY24: £100m).

Consistent with FY24, we determined that Group normalised profit before tax

from continuing operations (“PBTCO”) remains the benchmark for the Group.

This is normalised to exclude certain restructuring costs of £89m (FY24: £202m).

We adjusted for this item because it does not represent the normal, continuing

operations of the Group. Our Group materiality represents 4.9% (FY24: 5.2%) of

the benchmark.

Materiality for the Parent Company Financial Statements was determined with

reference to a benchmark of Parent Company total assets of which it represents

0.5% (FY24: 0.4%).

Materiality levels used in our audit

AMPT

LCM

PLC

HCM

GPM

Group

110

100

5.5

82.5

FY25 £m

FY24 £m

Group

Group Materiality

GPM

Group Performance Materiality

HCM

Highest Component Materiality

PLC

Parent Company Materiality

LCM

Lowest Component Materiality

AMPT

Audit Misstatement Posting Threshold

KPMG LLP’s Independent Auditor’s Report

continued

Group Scope

(Item 7 Below)

We have performed risk assessment and planning procedures to determine

which of the Group’s components are likely to include risks of material

misstatement to the Group Financial Statements, the type of procedures to

be performed at these components and the extent of involvement required

from our component auditors around the world.

We performed audit procedures on 17 (FY24: 18) components, having

considered our evaluation of the Group’s operational structure and our ability

to perform audit procedures centrally.

We also performed audit procedures in respect of the Group’s shared service

centres in Poland, Malaysia, Costa Rica and India. Together, these shared

service centres process a substantial portion of the Group’s transactions over

purchases, revenue, payroll and journal entries.

We also performed testing of centrally managed controls (manual and

automated), testing of general IT controls over centrally managed IT systems

and performance of specific risk focused audit procedures over purchases,

revenue, payroll and journal entries at the Group level.

In addition, for the remaining components for which we performed no audit

procedures, we performed analysis at an aggregated Group level to re-examine

our assessment that there is not a reasonable possibility of a material

misstatement in these components. In particular, we matched individual sales

orders to goods delivery documents and invoices to inform our assessment of

whether there was a reasonable possibility of a material misstatement in the

remaining revenue.

We consider the scope of our audit, as communicated to the Audit & Risk

Committee, to be an appropriate basis for our audit opinion.

Coverage of Group Financial Statements

Our audit procedures covered the following percentages:

Revenue

63%

Total

assets

90%

2. Overview of our audit

continued

Consolidated

Financial Statements

109

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

The impact of

climate change

on our audit

In planning our audit, we considered the impacts of climate change on the

Group’s business and its Financial Statements.

The Group set targets to achieve net zero carbon emissions from source to sale

by 2040, aligned to guidance from the Climate Pledge and Race to Zero. Further

information has been provided in the Group’s Strategic Report on page 21.

The Group continues to align its climate-related disclosures with the

recommendations of the Task Force on Climate Related Financial Disclosure

(“TCFD”) and the Companies Act. These disclosures are included in the Strategic

Report on pages 19 to 26.

Climate change risk could have a significant impact on the Group’s business as it

adapts its strategy and operations to address the potential financial risks which

could arise from both the physical and transition risks associated with climate

change. To evaluate and assess the resilience of its business to climate change,

the Group assessed the impact of damage and disruption caused by extreme

weather events, reduced availability and increased price volatility of raw

materials due to climate change, carbon pricing regulations and loss of

attractiveness due to consumers’ increasing expectations. These are the areas

in which the Group foresees the greatest potential for disruption. Further

information can be found on pages 19 to 26.

As part of our audit, we have made inquiries of the Group to understand the

extent of the potential impact of climate change risk on the Group’s Financial

Statements. We have performed a risk assessment of how climate risks facing

the Group, particularly those relating to the impact of damage and disruption

caused by extreme weather events, reduced availability and increased price

volatility of raw materials due to climate change, carbon pricing regulations and

loss of attractiveness due to consumers’ increasing expectations, and the

Group’s strategy to mitigate these risks, may affect the Financial Statements and

our audit. Our risk assessment focused on the risk climate change may pose to

the determination of future cash flows within the Group’s going concern

assessment and assessment over the recoverability of indefinite life brands, as

well as the impact on the carrying amount and useful lives of property, plant,

and equipment. We also held discussions with our own climate change

professionals to challenge our risk assessment.

On the basis of our risk assessment, we determined that while climate change

poses a risk to the determination of future cash flows, the risk to the audit from

climate change alone is not significant, as such there was no impact on our Key

Audit Matters.

We have read the climate-related information in the front half of the Annual

Report, and considered consistency with the statements and our audit

knowledge.

3. Going concern, viability and principal risks and uncertainties

The Directors have prepared the Financial Statements on the going concern basis as they do not

intend to liquidate the Group or the Parent Company or to cease their operations, and as they

have concluded that the Group’s and the Parent Company’s financial position means that this is

realistic. They have also concluded that there are no material uncertainties that could have cast

significant doubt over their ability to continue as a going concern for at least twelve months from

the date of approval of the Financial Statements (“the going concern period”).

Going concern

We used our knowledge of the Group, its industry, and the general economic environment to identify the

inherent risks to its business model and analysed how those risks might affect the Group’s and Company’s

financial resources or ability to continue operations over the going concern period. The risks that were

considered most likely to adversely affect the Group’s and Company’s available financial resources over

this period were:

—

Commodity inflation and pricing; and

—

Selling price and volume sensitivity.

We also considered realistic second order impacts, such as business transformation and portfolio

management failure.

We considered whether these risks could plausibly affect the liquidity in the going concern period by

assessing the degree of downside assumptions that, individually and collectively, could result in a liquidity

issue, considering the Group’s current projected cash and facilities and the outcome of their reverse

stress testing.

We considered whether the going concern disclosure in Note 1 to the Financial Statements gives a full and

accurate description of the Directors’ assessment of going concern.

Accordingly, based on those procedures, we found the Directors’ use of the going concern basis of

accounting without any material uncertainty for the Group and Parent Company to be acceptable.

However, as we cannot predict all future events or conditions and as subsequent events may result in

outcomes that are inconsistent with judgements that were reasonable at the time they were made, the

above conclusions are not a guarantee that the Group or the Parent Company will continue in operation.

Our conclusions

—

We consider that the Directors’ use of the going concern basis of accounting in the preparation of the

Financial Statements is appropriate;

—

We have not identified, and concur with the Directors’ assessment that there is not, a material

uncertainty related to events or conditions that, individually or collectively, may cast significant doubt

on the Group’s or Parent Company’s ability to continue as a going concern for the going concern period;

—

We have nothing material to add or draw attention to in relation to the Directors’ Statement in Note 1

to the Financial Statements on the use of the going concern basis of accounting with no material

uncertainties that may cast significant doubt over the Group and Parent Company’s use of that basis for

the going concern period, and we found the going concern disclosure in Note 1 to be acceptable; and

—

The related statement under the Listing Rules set out on page 58 is materially consistent with the

Financial Statements and our audit knowledge.

2. Overview of our audit

continued

110

Haleon

Annual Report and Form 20-F 2025

Disclosures of emerging and principal risks and longer-term viability

Our responsibility

We are required to perform procedures to identify whether there is a material inconsistency between the

Directors’ disclosures in respect of emerging and principal risks and the viability statement, and the

Financial Statements and our audit knowledge.

Based on those procedures, we have nothing material to add or draw attention to in relation to:

—

The Directors’ confirmation within the viability statement on page 58 that they have carried out a robust

assessment of the emerging and principal risks facing the Group, including those that would threaten its

business model, future performance, solvency and liquidity;

—

The Emerging and Principal Risks disclosures describing these risks and how emerging risks are

identified and explaining how they are being managed and mitigated; and

—

The Directors’ explanation in the viability statement of how they have assessed the prospects of the

Group, over what period they have done so and why they considered that period to be appropriate,

and their statement as to whether they have a reasonable expectation that the Group will be able to

continue in operation and meet its liabilities as they fall due over the period of their assessment,

including any related disclosures drawing attention to any necessary qualifications or assumptions.

We are also required to review the viability statement set out on page 58 under the Listing Rules.

Our work is limited to assessing these matters in the context of only the knowledge acquired during our

Financial Statements audit. As we cannot predict all future events or conditions and as subsequent events

may result in outcomes that are inconsistent with judgements that were reasonable at the time they were

made, the absence of anything to report on these statements is not a guarantee as to the Group’s and

Parent Company’s longer-term viability.

Our reporting

We have nothing material to add or draw attention to in relation to these disclosures.

We have concluded that these disclosures are materially consistent with the Financial Statements and our

audit knowledge.

KPMG LLP’s Independent Auditor’s Report

continued

4. Key audit matters

What we mean

Key audit matters are those matters that, in our professional judgement, were of most significance in the

audit of the Financial Statements and include the most significant assessed risks of material misstatement

(whether or not due to fraud) identified by us, including those which had the greatest effect on:

—

The overall audit strategy;

—

The allocation of resources in the audit; and

—

Directing the efforts of the engagement team.

We include below the Key Audit Matters in decreasing order of audit significance together with

our key audit procedures to address those matters and our results from those procedures

(unchanged from FY24). These matters were addressed, and our results are based on procedures

undertaken, for the purpose of our audit of the Financial Statements as a whole. We do not

provide a separate opinion on these matters.

3. Going concern, viability and principal risks and uncertainties

continued

Consolidated

Financial Statements

111

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

4.1 Recoverability of indefinite life brands (Group)

Financial Statement Elements

FY25

FY24

Intangible assets – Indefinite life brands

£16,594m

£17,623m

Intangible assets – Impairment

£7m

£135m

Our assessment of risk vs FY24

Our assessment is that the risk is similar to FY24. Preparation-H remains as the brand most sensitive

to possible change in the key assumptions.

Our results

FY25: Acceptable

FY24: Acceptable

Description of the Key Audit Matter

Forecast-based assessment

Indefinite life brands are impaired when their carrying amount exceeds their recoverable amount. There is

inherent uncertainty with regard to assumptions and estimates involved in the Group’s forecast-based

assessment of the recoverable amount of indefinite life brands. In particular, there is significant auditor

judgement involved in evaluating the discount rate used in the analysis of the recoverable amount of the

indefinite life brands.

The indefinite life brands most at risk of material misstatement were identified using sensitivity analysis on

key assumptions and a critical assessment of potential triggering events that could be indicative of an

impairment in the carrying value of the brands.

We identified that the indefinite life brand most sensitive to possible change in key assumptions used in

the valuation models is Preparation H, for which the carrying value is £1,042m as at 31 December 2025.

The effect of these matters is that, as part of our risk assessment, we determined that the evaluation of

the recoverability of the carrying value of Preparation-H has a high degree of estimation uncertainty with a

potential range of reasonable outcomes greater than our materiality for the Financial Statements as a

whole. The Financial Statements (Note 14) disclose the sensitivity estimated by the Group for this brand.

An impairment charge of £135m was recognised during the prior year, largely in relation to the impairment

of the Nexium brand. During the year Nexium brand has been reclassified to an amortised brand with a

definite useful life. Nexium brand was assessed for impairment prior to reclassification, and no further

impairment loss recognised.

Our response to the risk

Our procedures to address the risk included:

—

Control design and operation:

Evaluating the design and testing the operating effectiveness of certain

internal controls within the indefinite life brands impairment testing process, including controls related to

the development of the discount rate;

—

Sensitivity analysis:

Performing sensitivity analysis on the discount rate to assess its impact on the

Group’s determination that the fair value less cost to sell (“FVLCTS”) exceeds the carrying value;

—

Valuation expertise:

Involving our own valuation professional with specialised skills and knowledge,

who assisted in independently developing a range of discount rates using publicly available market data

for comparable companies and comparing these rates to those utilised by the Group to assess their

reasonableness;

—

Historical comparison:

Challenging projected revenue by comparing historical projections to actual

results to assess the Group’s ability to accurately forecast;

—

Benchmarking and assessing assumptions:

Assessing and challenging revenue growth rate against

externally derived publicly available data, including broker and analyst reports, industry reports, media

reports, macro-economic assumptions, academic and scientific studies, and regulatory changes; and

—

Assessing transparency:

Assessing whether the Group’s disclosures detail the critical estimates and

sensitivities including any impact of reasonably possible changes regarding the impairment testing of

indefinite life brands.

Communications with Haleon plc’s Audit & Risk Committee

Our discussions with and reporting to the Audit & Risk Committee included:

—

Our approach to the audit of indefinite life brands, including details of our planned substantive

procedures and extent of our controls reliance;

—

Our conclusions on the appropriateness of the Group’s impairment assessment, including

assumptions used by the Group in their FVLCTS based assessment to calculate the recoverable

amount of indefinite life brands and whether the discount rate used by the Group were reasonable;

and

—

The adequacy of disclosures, particularly as it relates to the critical estimates and sensitivities with

regard to the impairment testing.

Areas of particular auditor judgement

The evaluation of the assumptions used by the Group in the analysis of the recoverable amount of

indefinite life brands is an area requiring significant auditor judgement.

Our results

We found the indefinite life brands balance, and the related impairment charge, to be acceptable.

Further information in the Annual Report and Accounts: See the Audit & Risk Committee Report on page 70 for details on how the Audit & Risk Committee considered recoverable amount of

indefinite life brands as an area of significant attention, Note 3 for the accounting policy on indefinite life brands, and Note 14 for the financial disclosures.

4. Key audit matters

continued

112

Haleon

Annual Report and Form 20-F 2025

4.2 Recoverability of the Company’s investment in subsidiaries (Parent Company only)

Financial Statement Elements

FY25

FY24

Investment in Subsidiaries

£22,361m

£22,336m

Our assessment of risk vs FY24

Our assessment is that the risk is similar to FY24. There have been no material changes to the

Company’s investment in subsidiaries during the year.

Our results

FY25: Acceptable

FY24: Acceptable

Description of the Key Audit Matter

Low risk, high value

The carrying amount of the Company’s investment in subsidiaries represents 93.5% (FY24: 93.7%) of the

Company’s total assets.

We do not consider the carrying amounts of these investments to be at a high risk of significant

misstatement, or to be subject to a significant level of judgement. However, due to their materiality in

context of the Parent Company accounts, this is considered to be the area with the greatest effect on our

overall audit strategy and allocation of resources in planning and completing our audit of the Parent

Company.

Our response to the risk

We performed a substantive approach rather than seeking to rely on any of the company’s controls because

the nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described below.

Our procedures to address the risk included:

—

Tests of detail:

Comparing the carrying amount of 100% of investments with the relevant subsidiary’s

draft balance sheet to identify whether their net assets, being an approximation of the minimum

recoverable amount, were in excess of their carrying amount and assessing whether those subsidiaries

have historically been profit making;

—

Comparing valuations:

Comparing the carrying amount of the Company’s investment in subsidiaries with

the expected value of the business based on the net assets of the Group, as well as to the market

capitalisation; and

—

Indicators:

Evaluating the considerations of indicators of impairment of the Parent Company’s direct

investments.

Communications with Haleon plc’s Audit & Risk Committee

Our discussions with and reporting to the Audit & Risk Committee included:

—

Our approach to the audit of the recoverability of the Parent company’s investments in subsidiaries,

including the planned substantive procedures; and

—

An assessment of indicators of impairment from the conclusion reached in the Group impairment

workings.

Our results

We found the conclusion that there is no impairment of the investment in subsidiaries to be acceptable.

Further information in the Annual Report and Accounts: See Note 2 of the Parent Company Financial Statements for the accounting policy on investments in subsidiaries and Note 5 of the Parent

Company Financial Statements for the financial disclosures.

KPMG LLP’s Independent Auditor’s Report

continued

4. Key audit matters

continued

Consolidated

Financial Statements

113

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

5. Our ability to detect irregularities, and our response

Fraud – Identifying and responding to risks of material misstatement due to fraud

Fraud risk

assessment

To identify risks of material misstatement due to fraud (fraud risks) we assessed

events or conditions that could indicate an incentive or pressure to commit

fraud, or provide an opportunity to commit fraud. Our risk assessment

procedures included:

—

Inquiring of Directors, the Audit & Risk Committee, internal audit and

inspection of policy documentation as to the Group’s high-level policies and

procedures to prevent and detect fraud, including the internal audit function,

and the Group’s channel for “whistleblowing”, as well as whether they have

knowledge of any actual, suspected or alleged fraud;

—

Reading Board and Audit & Risk Committee minutes;

—

Considering remuneration and incentive schemes and performance targets

for senior management;

—

Using analytical procedures to identify unusual or unexpected relationships;

and

—

Using our own forensic professionals with specialised skills and knowledge

to assist us in identifying the fraud risks based on discussions of the

circumstances of the Group.

Risk

communications

We communicated identified fraud risks throughout the audit team and

remained alert to any indications of fraud throughout the audit. This included

communication from the Group to component audit teams of relevant fraud risks

identified at the Group level and requests to component audit teams to report

to the Group auditor any instances of fraud that could give rise to a material

misstatement at the Group level.

Fraud risks

As required by auditing standards, and taking into account possible pressures

to meet profit targets, we performed procedures to address the risk of

management override of controls, in particular the risk that Group and

component management may be in a position to make inappropriate accounting

entries and the risk of bias in accounting estimates. On this audit we do not

believe there is a fraud risk related to revenue recognition as the revenue model

is non-complex with limited estimation or manual intervention. Revenue is

disaggregated between a significant number of components and remuneration

targets are based on Group performance rather than component performance.

We did not identify any additional fraud risks.

Procedures to

address fraud risks

In determining the audit procedures, we have taken into account the results of

our evaluation and testing of the operating effectiveness of the Group-wide

fraud risk management controls.

We also performed the following:

—

Identifying journal entries to test for all in-scope components based on risk

criteria and comparing the identified entries to supporting documentation.

These included journal entries posted to seldom used accounts, journal

entries posted by a user who only posted few entries for the fiscal year,

journal entries containing a pre-defined list of keywords and those posted

with an unusual account combination; and

—

Assessing whether the judgements made in making accounting estimates are

indicative of a potential bias.

114

Haleon

Annual Report and Form 20-F 2025

Laws and regulations – Identifying and responding to risks of material misstatement

relating to compliance with laws and regulations

Laws and

regulations risk

assessment

We identified areas of laws and regulations that could reasonably be expected

to have a material effect on the Financial Statements from our general

commercial and sector experience, through discussion with the Directors and

other management (as required by the auditing standards), from inspection of

the Group’s regulatory and legal correspondence and discussion with the

Directors and other management the policies and procedures regarding

compliance with laws and regulations.

Risk

communications

We communicated identified laws and regulations throughout our team and

remained alert to any indications of non-compliance throughout the audit.

This included communication from the Group to in-scope component audit

teams of relevant laws and regulations identified at a Group level, and

requested for in-scope component auditors to report any instances of

non-compliance with laws and regulations that could give rise to a material

misstatement at a Group level.

Direct laws context

and link to audit

The potential effect of these laws and regulations on the Financial Statements

varies considerably.

Firstly, the Group is subject to laws and regulations that directly affect the

Financial Statements including financial reporting legislation (including related

companies’ legislation), distributable profits legislation and taxation legislation.

We assessed the extent of compliance with these laws and regulations as part

of our procedures on the related Financial Statement items.

Most significant

indirect law/

regulation areas

Secondly, the Group is subject to many other laws and regulations where the

consequences of non-compliance could have a material effect on amounts or

disclosures in the Financial Statements, for instance through the imposition of

fines or litigation. We identified the following areas as those most likely to have

such an effect:

—

Competition legislation (reflecting the Group’s involvement in a number of

ongoing investigations by national competition authorities);

—

Employment legislation (reflecting the Group’s significant and geographically

diverse work force);

—

Health and safety regulation (reflecting the nature of the Group’s production

and distribution processes);

—

Consumer product law such as product safety and product claims (reflecting

the nature of the Group’s diverse product base);

—

Fraud, corruption and bribery legislation, including the Foreign Corrupt

Practices Act and UK Bribery act (reflecting the Group’s global operations,

including higher risk jurisdictions);

—

Sanctions (reflecting the Group’s global operations, including higher risk

jurisdictions);

—

Contract legislation (reflecting the Group’s extensive use of trademarks,

—

Data privacy (requirements from existing data privacy laws); and

—

Environmental regulation (reflecting nature of the Group’s production and

distribution processes).

Auditing standards limit the required audit procedures to identify non-

compliance with these laws and regulations to enquiry of the Directors

and other senior management, and inspection of regulatory and legal

correspondence, if any. Therefore, if a breach of operational regulations is not

disclosed to us or evident from relevant correspondence, an audit will not

detect that breach.

Context

Context of the

ability of the audit

to detect fraud or

breaches of law or

regulation

Owing to the inherent limitations of an audit, there is an unavoidable risk that

we may not have detected some material misstatements in the Financial

Statements, even though we have properly planned and performed our audit

in accordance with auditing standards. For example, the further removed

non-compliance with laws and regulations is from the events and transactions

reflected in the Financial Statements, the less likely the inherently limited

procedures required by auditing standards would identify it.

In addition, as with any audit, there remained a higher risk of non-detection

of fraud, as fraud may involve collusion, forgery, intentional omissions,

misrepresentations, or the override of internal controls. Our audit procedures

are designed to detect material misstatement. We are not responsible for

preventing non-compliance or fraud and cannot be expected to detect

non-compliance with all laws and regulations.

KPMG LLP’s Independent Auditor’s Report

continued

5. Our ability to detect irregularities, and our response

continued

Consolidated

Financial Statements

115

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

6. Our determination of materiality

The scope of our audit was influenced by our application of materiality. We set quantitative

thresholds and overlay qualitative considerations to help us determine the scope of our

audit and the nature, timing and extent of our procedures, and in evaluating the effect of

misstatements, both individually and in the aggregate, on the Financial Statements as a whole.

£110m

(FY24: £110m)

Materiality for the

Group financial

statements as a

whole

What we mean

A quantitative reference for the purpose of planning and performing our audit.

Basis for determining materiality and judgements applied

Materiality for the Group Financial Statements as a whole was set at £110m

(FY24: £110m). Consistent with FY24, materiality was determined with reference

to a benchmark of normalised Group profit before taxation from continuing

operations (“PBTCO”). We adjusted for these items because they do not

represent the normal, continuing operations of the Group. The items we

adjusted for were certain restructuring costs of £89m (FY24: £202m).

This represents 4.9% (2024: 5.2%) of the final Group normalised PBTCO value.

We considered the materiality amount for the Financial Statements as a whole

and concluded that it remained appropriate.

We have inspected analyst consensus data and other investor commentary

to identify what are considered to be key indicators of performance, and

concluded normalised PBTCO to be the basis for earnings, and therefore the

primary focus of a reasonable investor. We have inspected analyst consensus

data and other investor commentary for indicators of alternate significant

drivers of economic decisions. No revisions to our calculation methodology

resulted therefrom.

Materiality for the Parent Company Financial Statements as a whole was set at

£100m (FY24: £100m), determined with reference to a benchmark of Parent

Company total assets, of which it represents 0.5% (FY24: 0.4%).

£82.5m

(FY24: £82.5m)

performance

materiality

What we mean

Our procedures on individual account balances and disclosures were

performed to a lower threshold, performance materiality, so as to reduce to

an acceptable level the risk that individually immaterial misstatements in

individual account balances add up to a material amount across the Financial

Statements as a whole.

Basis for determining performance materiality and judgements applied

We have considered performance materiality at a level of 75% (FY24: 75%) of

materiality for Haleon plc’s Group Financial Statements as a whole to be

appropriate.

The Parent Company performance materiality was set at £75m (FY24: £75m),

which equates to 75% (FY24: 75%) of materiality for the Parent Company

Financial Statements as a whole.

We applied this percentage in our determination of performance materiality

because although we did identify specific IT findings during the FY24 audit,

the majority of factors did not indicate an elevated level of risk.

£5.5m

(FY24: £5.5m) audit

misstatement

posting threshold

What we mean

This is the amount below which identified misstatements are considered to be

clearly trivial from a quantitative point of view. We may become aware of

misstatements below this threshold which could alter the nature, timing and

scope of our audit procedures, for example if we identify smaller misstatements

which are indicators of fraud.

This is also the amount above which all misstatements identified are

communicated to Haleon plc’s Audit & Risk Committee.

Basis for determining the audit misstatement posting threshold and

judgements applied

We set our audit misstatement posting threshold at 5% (FY24: 5%) of our

materiality for the Group Financial Statements. We also report to the Audit &

Risk Committee any other identified misstatements that warrant reporting on

qualitative grounds.

The overall materiality for the Group Financial Statements of £110m (FY24: £110m) compares as

follows to the main Financial Statement caption amounts:

Total Group revenue

Group profit before tax

Total Group assets

FY25

FY24

FY25

FY24

FY25

FY24

Financial Statement caption

£11,030m

£11,233m

£2,152m

£1,910m

£32,630m

£34,315m

Group Materiality as % of caption

1.0%

5.1%

5.8%

0.3%

116

Haleon

Annual Report and Form 20-F 2025

7. The scope of our audit

Group scope

What we mean

How the Group auditor determined the procedures to be performed across the

Group.

We performed risk assessment procedures to determine which of the Group’s

components are likely to include risks of material misstatement to the Group

Financial Statements and which procedures to perform at these components to

address those risks.

In total, we identified 209 (FY24: 208) components, having considered the

Group’s geographical locations and operational structure.

Of those, we identified 2 (FY24: 1) quantitatively significant component which

contained the largest percentages of both total revenue and total assets of the

Group, for which we performed audit procedures.

Additionally, having considered qualitative and quantitative factors, we selected

15 (FY24:17) components with accounts contributing to the specific risks of

material misstatement of the Group Financial Statements.

The below summarises where we performed audit procedures, with the prior

year comparatives indicated in brackets:

Component type

Number of

components

where audit

procedures were

performed

Range of

materiality

applied

Quantitatively significant components

2 (1)

£28m–£82.5m

(£88m)

Other components

15 (17)

£15m–£40m

(£12m–£56m)

Total

17 (18)

KPMG LLP’s Independent Auditor’s Report

continued

We involved component auditors in performing the audit work on 17 (FY24:18)

components. We performed audit procedures on the items excluded from the

normalised Group profit before tax used as the benchmark for our materiality.

We approved the component materialities having regard to the mix of size and

risk profile of the Group across the components. The Group auditor performed

the audit of the Parent Company.

The Group also operates shared service centres in Poland, Malaysia, Costa Rica

and India, which are relevant to our audit, and perform accounting and

reporting activities. Together, these shared service centres process a substantial

portion of the Group’s transactions over purchases, revenue, payroll and journal

entries. The outputs relate to financial information of the reporting components

they service, and therefore they are not separate reporting components.

Each service centre was subject to specified risk-focused audit procedures,

predominantly the testing of transaction processing operated from the Group’s

shared service centres.

Our audit procedures covered 63% (FY24: 63%) of Group revenue, 90%

(FY24:85%) of Group total assets and 62% (FY24:68%) of total profits and losses

that make up Group profit before taxation. For the remaining components for

which we performed no audit procedures, no component represented more

than 3% (FY24:2%) of Group total revenue or more than 4% (FY24:3%) of Group

profit before taxation. We performed analysis at an aggregated Group level

to re-examine our assessment that there is not a reasonable possibility of

a material misstatement in these components. In particular, we matched

individual sales orders to goods delivery documents and invoices to inform

our assessment of whether there was a reasonable possibility of a material

misstatement in the remaining revenue.

Impact of controls on our group audit

We identified 10 (FY24:10) key finance IT systems as being relevant to our

Group audit, which included the Enterprise Resource Planning (“ERP”) system

used across the majority of components of the Group to record underlying

transactions, and the Group’s consolidation system. These IT systems are

primarily managed from the centralised IT function in Haleon’s shared service

centres. We centrally assessed the design and operating effectiveness of the

general IT controls and key automated controls related to financial reporting of

IT systems, this contributed to our risk assessment.

Taking into account our assessment of the most effective audit approach, our

knowledge of the general IT control environment, and the timing of remediation

activities during the year under audit, we planned and performed a substantive

audit when determining the extent, timing, and nature of our procedures, except

for reliance on controls to support certain key reports, including in relation to

journals, revenue and inventory.

Consolidated

Financial Statements

117

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Group auditor

oversight

What we mean

The extent of the Group auditor’s involvement in work performed by

component auditors.

As part of establishing the overall Group audit strategy and plan, we conducted

the risk assessment and planning discussion meetings with component auditors

to discuss Group audit risks relevant to the components.

Instructions

We instructed component auditors as to the areas to be covered, including the

relevant risks detailed above and the information to be reported back.

Virtual meetings and calls

We held regular virtual meetings with the component auditors in-scope for

Group reporting. These meetings were held to understand the business, any

updates to the risk assessment and any issues and findings. The findings

reported to us were discussed in more detail with component auditors and any

further work required by us was then performed by the component auditors.

Site visits

We visited 5 (FY24: 5) component auditors and 4 (FY24: 4) shared service centre

auditors in the below locations to assess the audit risks and strategy:

—

Component Auditors: United States, Canada, France, India, Australia

(FY24: United States, Puerto Rico, Canada, China and Germany); and

—

Shared Service Centres (in line with FY24): Poland, Malaysia, Costa Rica

and India.

At these site visits and meetings, the results of the planning procedures and

further audit procedures communicated to us were discussed in more detail,

and any further work required by us was then performed by the component

auditors.

Global conference

We hosted a virtual conference in June 2025. This conference emphasised

key areas of the Group audit instructions and allowed for the sharing of risk

assessment considerations and Group updates. It helped us to enhance our

understanding of the component auditors’ perspective on the overall audit

approach and improve two-way communication. The conference covered key

Group developments, the origins of risk and IT audit planning.

Inspection of work papers

We inspected the work performed by the component auditors for the purpose

of the Group audit and evaluated the appropriateness of conclusions drawn

from the audit evidence obtained and consistencies between communicated

findings and work performed, with a particular focus on journal entries and

revenue testing procedures performed.

8. Other information in the annual report

The Directors are responsible for the other information presented in the Annual Report together

with the Financial Statements. Our opinion on the Financial Statements does not cover the other

information and, accordingly, we do not express an audit opinion or, except as explicitly stated

below, any form of assurance conclusion thereon.

All other information

Our responsibility

Our responsibility is to read the other information and, in doing so, consider whether, based on our

Financial Statements audit work, the information therein is materially misstated or inconsistent with the

Financial Statements or our audit knowledge.

Our reporting

Based solely on that work we have not identified material misstatements or inconsistencies in the other

information.

Strategic Report and Directors’ Report

Our responsibility and reporting

Based solely on our work on the other information described above we report to you as follows:

—

We have not identified material misstatements in the Strategic Report and the Directors’ Report;

—

In our opinion the information given in those reports for the financial year is consistent with the

Financial Statements; and

—

In our opinion those Reports have been prepared in accordance with the Companies Act 2006.

Directors’ Remuneration Report

Our responsibility

We are required to form an opinion as to whether the part of the Directors’ Remuneration Report to be

audited has been properly prepared in accordance with the Companies Act 2006.

Our reporting

In our opinion the part of the Directors’ Remuneration Report to be audited has been properly prepared

in accordance with the Companies Act 2006.

7. The scope of our audit

continued

118

Haleon

Annual Report and Form 20-F 2025

Corporate governance disclosures

Our responsibility

We are required to perform procedures to identify whether there is a material inconsistency between the

Financial Statements and our audit knowledge, and:

—

The Directors’ statement that they consider that the Annual Report and Financial Statements taken as a

whole is fair, balanced and understandable, and provides the information necessary for shareholders to

assess the Group’s position and performance, business model and strategy;

—

The section of the Annual Report describing the work of the Audit & Risk Committee, including the

significant issues that the Audit & Risk Committee considered in relation to the Financial Statements,

and how these issues were addressed; and

—

The section of the Annual Report that describes the review of the effectiveness of the Group’s risk

management and internal control systems.

Our reporting

Based on those procedures, we have concluded that each of these disclosures is materially consistent

with the Financial Statements and our audit knowledge.

Our responsibility

We are also required to review the part of the Corporate Governance Statement relating to the Group’s

compliance with the provisions of the UK Corporate Governance Code specified by the Listing Rules for

our review.

Our reporting

We have nothing to report in this respect.

Other matters on which we are required to report by exception

Our responsibility

Under the Companies Act 2006, we are required to report to you if, in our opinion:

—

Adequate accounting records have not been kept by the Parent Company, or returns adequate for our

audit have not been received from branches not visited by us; or

—

The Parent Company Financial Statements and the part of the Directors’ Remuneration Report to be

audited are not in agreement with the accounting records and returns; or

—

Certain disclosures of Directors’ remuneration specified by law are not made; or

—

We have not received all the information and explanations we require for our audit.

Our reporting

We have nothing to report in these respects.

KPMG LLP’s Independent Auditor’s Report

continued

9. Respective responsibilities

Directors’ responsibilities

As explained more fully in their statement set out on page 105, the Directors are responsible for:

the preparation of the Financial Statements including being satisfied that they give a true and fair

view. The Directors are also responsible for; such internal control as they determine is necessary

to enable the preparation of Financial Statements that are free from material misstatement,

whether due to fraud or error; assessing the Group and Parent Company’s ability to continue

as a going concern, disclosing, as applicable, matters related to going concern; and using the

going concern basis of accounting unless they either intend to liquidate the Group or the

Parent Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities

Our objectives are to obtain reasonable assurance about whether the Financial Statements as

a whole are free from material misstatement, whether due to fraud or error, and to issue our

opinion in an Auditor’s Report. Reasonable assurance is a high level of assurance, but does not

guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material

misstatement when it exists. Misstatements can arise from fraud or error and are considered

material if, individually or in aggregate, they could reasonably be expected to influence the

economic decisions of users taken on the basis of the Financial Statements.

A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/

auditorsresponsibilities.

The Company is required to include these Financial Statements in an annual financial report

prepared under Disclosure Guidance and Transparency Rule 4.1.17R and 4.1.18R. This auditor’s

Report provides no assurance over whether the annual financial report has been prepared in

accordance with those requirements.

10. The purpose of our audit work and to whom we owe our

responsibilities

This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of

Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state

to the Company’s members those matters we are required to state to them in an Auditor’s Report

and for no other purpose. To the fullest extent permitted by law, we do not accept or assume

responsibility to anyone other than the Company and the Company’s members, as a body, for

our audit work, for this report, or for the opinions we have formed.

Jeremy Hall (Senior Statutory Auditor)

for and on behalf of KPMG LLP, Statutory Auditor

Chartered Accountants

15 Canada Square

London, E14 5GL

13 March 2026

8. Other information in the annual report

continued

Consolidated

Financial Statements

119

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Report of

Independent

Registered Public

Accounting Firm

To the Shareholders and Board of

Directors of Haleon plc:

Opinions on the Consolidated Financial

Statements and Internal Control Over

Financial Reporting

We have audited the accompanying

consolidated balance sheets of Haleon plc

and subsidiaries (“the Company”) as of

31 December 2025 and 2024, the related

Consolidated Income Statement, Statement of

Comprehensive Income, Statement of Changes

in Equity, and Cash Flow Statement for each

of the years in the three-year period ended

31 December 2025 and the related notes

(collectively, “the Consolidated Financial

Statements”). We also have audited the

Company’s internal control over financial

reporting as of 31 December 2025, based on

criteria established in

Internal Control –

Integrated Framework (2013)

issued by the

Committee of Sponsoring Organizations of

the Treadway Commission.

In our opinion, the Consolidated Financial

Statements referred to above present fairly,

in all material respects, the financial position

of the Company as of 31 December 2025 and

2024, and the results of its operations and

its cash flows for each of the years in the

three-year period ended 31 December 2025,

in conformity with International Financial

Reporting Standards (“IFRS”) as issued by the

International Accounting Standards Board

(“IASB”). Also in our opinion, the Company

maintained, in all material respects, effective

internal control over financial reporting as

of 31 December 2025 based on criteria

established in

Internal Control – Integrated

Framework (2013)

issued by the Committee

of Sponsoring Organizations of the Treadway

Commission.

Basis for Opinions

The Company’s management is responsible

for these Consolidated Financial Statements,

for maintaining effective internal control over

financial reporting, and for its assessment

of the effectiveness of internal control

over financial reporting, included in the

accompanying management’s report on

internal control over financial reporting.

Our responsibility is to express an opinion

on the Company’s Consolidated Financial

Statements and an opinion on the Company’s

internal control over financial reporting based

on our audits. We are a public accounting

firm registered with the Public Company

Accounting Oversight Board (United States)

(“PCAOB”) and are required to be

independent with respect to the Company

in accordance with the U.S. federal securities

laws and the applicable rules and regulations

of the Securities and Exchange Commission

and the PCAOB.

We conducted our audits in accordance with

the standards of the PCAOB. Those standards

require that we plan and perform the audits to

obtain reasonable assurance about whether

the Consolidated Financial Statements are

free of material misstatement, whether due

to error or fraud, and whether effective

internal control over financial reporting

was maintained in all material respects.

Our audits of the Consolidated Financial

Statements included performing procedures

to assess the risks of material misstatement

of the Consolidated Financial Statements,

whether due to error or fraud, and performing

procedures that respond to those risks. Such

procedures included examining, on a test

basis, evidence regarding the amounts and

disclosures in the Consolidated Financial

Statements. Our audits also included

evaluating the accounting principles used and

significant estimates made by management,

as well as evaluating the overall presentation

of the Consolidated Financial Statements.

Our audit of internal control over financial

reporting included obtaining an understanding

of internal control over financial reporting,

assessing the risk that a material weakness

exists, and testing and evaluating the design

and operating effectiveness of internal control

based on the assessed risk. Our audits also

included performing such other procedures as

we considered necessary in the circumstances.

We believe that our audits provide a

reasonable basis for our opinions.

Definition and Limitations of Internal

Control Over Financial Reporting

A company’s internal control over financial

reporting is a process designed to provide

reasonable assurance regarding the reliability

of financial reporting and the preparation of

Financial Statements for external purposes

in accordance with generally accepted

accounting principles. A company’s internal

control over financial reporting includes those

policies and procedures that (1) pertain to the

maintenance of records that, in reasonable

detail, accurately and fairly reflect the

transactions and dispositions of the assets

of the company; (2) provide reasonable

assurance that transactions are recorded

as necessary to permit preparation of

Consolidated Financial Statements in

accordance with generally accepted

accounting principles, and that receipts and

expenditures of the company are being made

only in accordance with authorizations of

management and directors of the company;

and (3) provide reasonable assurance

regarding prevention or timely detection of

unauthorized acquisition, use, or disposition

of the company’s assets that could have

a material effect on the Consolidated

Financial Statements.

Because of its inherent limitations, internal

control over financial reporting may not

prevent or detect misstatements. Also,

projections of any evaluation of effectiveness

to future periods are subject to the risk that

controls may become inadequate because of

changes in conditions, or that the degree of

compliance with the policies or procedures

may deteriorate.

120

Haleon

Annual Report and Form 20-F 2025

Critical Audit Matter

The critical audit matter communicated below

is a matter arising from the current period

audit of the Consolidated Financial Statements

that was communicated or required to be

communicated to the Audit & Risk Committee

and that: (1) relates to accounts or disclosures

that are material to the Consolidated Financial

Statements and (2) involved our especially

challenging, subjective, or complex judgments.

The communication of a critical audit matter

does not alter in any way our opinion on the

Consolidated Financial Statements, taken as

a whole, and we are not, by communicating

the critical audit matter below, providing a

separate opinion on the critical audit matter

or on the accounts or disclosures to which

it relates.

Assessment of the recoverable amount

for the Preparation-H intangible asset

As discussed in Note 14 to the Consolidated

Financial Statements, as of 31 December 2025,

the Company has a £1,042m intangible asset

related to its Preparation-H indefinite life

brand. As discussed in Note 3, the Company

performs impairment testing on an annual

basis and whenever events or changes in

circumstances indicate that a brand’s carrying

value may exceed its recoverable amount.

The recoverable amount utilised in the

impairment test is estimated using a fair value

less costs to sell model.

We identified the assessment of the

recoverable amount for the Preparation-H

intangible asset as a critical audit matter.

It required a high degree of auditor judgment,

including the involvement of valuation

specialists with specialised skills and

knowledge, to evaluate the significant

assumption, specifically the discount rate used

to estimate the recoverable amount of the

brand. We performed a sensitivity analysis to

identify this significant assumption. Minor

changes to the assumption used could have

had a significant effect on the Company’s

determination of the recoverable amount.

The following are the primary procedures we

performed to address this critical audit matter:

— Evaluated the design and tested operating

effectiveness of certain internal controls

related to the indefinite life brands

impairment process. This included the

control over the development of the

discount rate;

— Performed sensitivity analysis on the

discount rate to assess its impact on the

Company’s determination of the fair value

relative to the carrying value; and

— Involved a valuation professional with

specialised skills and knowledge who

assisted in independently developing a

range of discount rates using publicly

available market data for comparable

companies and comparing that range

with the rate used by the Company.

KPMG LLP

We have served as the Company’s auditor

since 2023.

London, United Kingdom

13 March 2026

Report of Independent Registered Public Accounting Firm

continued

Consolidated income statement

For the year ended

Notes

31 December 2025

£m

31 December 2024

£m

31 December 2023

£m

Revenue

11,030

11,233

11,302

Cost of sales

(3,950)

(4,409)

(4,555)

Gross profit

7,080

6,824

6,747

Selling, general and administration

(4,364)

(4,452)

(4,413)

Research and development

(316)

(298)

(311)

Other operating income/(expense)

132

(27)

Operating profit

2,412

2,206

1,996

Finance income

Finance expense

(340)

(384)

(402)

Net finance costs

(262)

(302)

(368)

Net monetary gain arising from hyperinflationary economies

–

Profit before tax

2,152

1,910

1,628

Income tax

(472)

(435)

(517)

Profit after tax for the year

1,680

1,475

1,111

Profit attributable to shareholders of the Group

1,667

1,442

1,049

Profit attributable to non-controlling interests

Basic earnings per share (pence)

18.6

15.8

11.4

Diluted earnings per share (pence)

18.5

15.7

11.3

Consolidated

Financial Statements

121

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Consolidated statement of comprehensive income

For the year ended

Notes

31 December 2025

£m

31 December 2024

£m

31 December 2023

£m

Profit after tax for the year

1,680

1,475

1,111

Other comprehensive (expenses)/income for the year

Items that may be subsequently reclassified to the income statement:

Exchange movements on overseas net assets

(246)

(132)

(420)

Exchange movements on overseas net assets of non-controlling interests

(1)

(2)

(7)

Fair value movements on cash flow hedges

(1)

Reclassification of cash flow hedges to the income statement

(38)

(33)

(23)

Related tax on items that may be subsequently reclassified to the income statement

Total

(259)

(160)

(438)

Items that will not be reclassified to the income statement:

Remeasurement gains on defined benefit plan

Related tax on items that will not be reclassified to the income statement

(7)

Fair value movements on equity investments

(15)

–

Total

Other comprehensive (expenses)/income, net of tax for the year

(243)

(148)

(432)

Total comprehensive income, net of tax for the year

1,437

1,327

679

Total comprehensive income for the year attributable to:

Shareholders of the Group

1,425

1,296

624

Non-controlling interests

Includes tax on fair value movements on cash flow hedges of £(4)m (2024: £nil), netted off by tax on reclassification of cash flow hedges to the income statement of £9m (2024: £8m).

122

Haleon

Annual Report and Form 20-F 2025

Consolidated balance sheet

as at

Notes

31 December

2025

£m

31 December

2024

£m

Non-current assets

Property, plant and equipment

1,871

1,809

Right of use assets

126

112

Intangible assets

25,613

26,211

Other investments

27,25

Deferred tax assets

289

276

Post-employment benefit assets

Derivative financial instruments

–

Other non-current assets

Total non-current assets

28,080

28,597

Current assets

Inventories

1,025

1,190

Trade and other receivables

2,058

2,055

Cash and cash equivalents

1,324

2,250

Derivative financial instruments

130

Current tax receivables

Total current assets

4,550

5,718

Total assets

32,630

34,315

Current liabilities

Short-term borrowings

(836)

(1,487)

Trade and other payables

(3,730)

(3,705)

Other financial liability

–

(177)

Derivative financial instruments

(31)

(90)

Current tax payables

(267)

(235)

Short-term provisions

(69)

(118)

Total current liabilities

(4,933)

(5,812)

Notes

31 December

2025

£m

31 December

2024

£m

Non-current liabilities

Long-term borrowings

(7,773)

(8,640)

Deferred tax liabilities

(3,222)

(3,353)

Post-employment benefit obligations

(114)

(131)

Derivative financial instruments

(34)

(70)

Long-term provisions

(40)

(57)

Other non-current liabilities

(30)

(28)

Total non-current liabilities

(11,213)

(12,279)

Total liabilities

(16,146)

(18,091)

Net assets

16,484

16,224

Equity

Share capital

Other reserves

(11,512)

(11,197)

Retained earnings

27,847

27,272

Shareholders

’

equity

16,425

16,166

Non-controlling interests

Total equity

16,484

16,224

The accompanying notes form part of these financial statements. The financial statements on pages 121 to

168 were approved by the Board of Directors and signed on its behalf by:

Dawn Allen

Chief Financial Officer

13 March 2026

Consolidated

Financial Statements

123

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Consolidated statement of changes in equity

For the year ended

Notes

capital

£m

premium

£m

Other

reserves

£m

Retained

earnings

£m

Shareholders

’

equity

£m

Non-controlling

interests

£m

Total

equity

£m

At 1 January 2025

–

(11,197)

27,272

16,166

16,224

Profit after tax

–

1,667

1,680

Other comprehensive (expenses)/income

–

(273)

(242)

(1)

(243)

Total comprehensive (expenses)/income

–

(273)

1,698

1,425

1,437

Distributions to non-controlling interests

–

(11)

Dividends to equity shareholders

–

(612)

–

(612)

Share-based incentive plans

–

Tax on share-based incentive plans

–

Shares transferred to employees

–

108

(109)

(1)

–

(1)

Purchase of treasury shares

–

(151)

–

(151)

–

(151)

Repurchase of ordinary shares and capital reduction

(1)

–

(503)

–

(503)

Purchase of non-controlling interests

–

At 31 December 2025

–

(11,512)

27,847

16,425

16,484

124

Haleon

Annual Report and Form 20-F 2025

Notes

capital

£m

premium

£m

Other

reserves

£m

Retained

earnings

£m

Shareholders

’

equity

£m

Non-controlling

interests

£m

Total

equity

£m

At 1 January 2024

–

(10,960)

27,474

16,606

123

16,729

Implementation of IAS 29 – Hyperinflation

–

At 1 January 2024 Restated

–

(10,960)

27,483

16,615

123

16,738

Profit after tax

–

1,442

1,475

Other comprehensive (expenses)/income

–

(158)

(146)

(2)

(148)

Total comprehensive (expenses)/income

–

(158)

1,454

1,296

1,327

Distributions to non-controlling interests

–

(79)

Dividends to equity shareholders

–

(570)

–

(570)

Share-based incentive plans

–

102

–

102

Tax on share-based incentive plans

–

Shares transferred to employees

–

(40)

–

Purchase of shares by employee benefit trusts

–

(5)

–

(5)

–

(5)

Purchase of treasury shares

–

(116)

–

(116)

–

(116)

Repurchase of ordinary shares and capital reduction

(1)

–

(503)

–

(503)

Purchase of non-controlling interests

–

(479)

(17)

(496)

Non-controlling interests purchase option

–

(177)

–

(177)

At 31 December 2024

–

(11,197)

27,272

16,166

16,224

capital

£m

premium

£m

Other

reserves

£m

Retained

earnings

£m

Shareholders

’

equity

£m

Non-controlling

interests

£m

Total

equity

£m

At 1 January 2023

–

(10,491)

26,730

16,331

126

16,457

Profit after tax

–

1,049

1,111

Other comprehensive (expenses)/income

–

(431)

(425)

(7)

(432)

Total comprehensive (expenses)/income

–

(431)

1,055

624

679

Distributions to non-controlling interests

–

(58)

Dividends to equity shareholders

–

(388)

–

(388)

Share-based incentive plans

–

Tax on share-based incentive plans

–

Purchase of shares by employee benefit trusts

–

(38)

–

(38)

–

(38)

At 31 December 2023

–

(10,960)

27,474

16,606

123

16,729

Consolidated

Financial Statements

125

Haleon

Annual Report and Form 20-F 2025

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Consolidated cash flow statement

For the year ended

Notes

31 December

2025

£m

31 December

2024

£m

31 December

2023

£m

Cash flows from operating activities

Profit after tax

1,680

1,475

1,111

Taxation charge

472

435

517

Net finance costs

262

302

368

Depreciation of property, plant and equipment and right

of use assets

12, 13

240

225

201

Amortisation of intangible assets

120

108

Impairment and assets written off, net of reversals

192

200

(Gain)/Loss on sale of intangible assets, property,

plant and equipment

–

(7)

Gain on sale of business

–

(121)

–

Share-based incentive plan expense

102

Other non-cash movements

(17)

(15)

(11)

(Decrease)/increase in pension and other provisions

(73)

Changes in working capital:

Decrease/(increase) in inventories

133

216

(131)

(Increase)/decrease in trade receivables

(65)

(312)

Increase in trade payables

125

158

112

Net change in other receivables and payables

144

(126)

Taxation paid

(439)

(593)

(445)

Net cash inflow from operating activities

2,634

2,301

2,100

Cash flows from investing activities

Purchase of property, plant and equipment

(322)

(250)

(234)

Purchase of intangible assets

(91)

(68)

(102)

Proceeds from sale of intangible assets

–

325

246

Purchase of business, net of cash acquired

–

(71)

Proceeds from sale of businesses

446

–

Increase in liquid investments

(6)

–

Interest received

Net cash (outflow)/inflow from investing activities

(346)

528

(134)

Notes

31 December

2025

£m

31 December

2024

£m

31 December

2023

£m

Cash flows from financing activities

Payment of lease liabilities

(60)

(55)

Interest paid

(357)

(360)

(404)

Dividends paid to shareholders

(612)

(570)

(388)

Purchase of non-controlling interests

(174)

(488)

–

Distributions to non-controlling interests

(11)

(79)

(58)

Repayment of borrowings

(1,352)

(562)

(553)

Proceeds from borrowings

1,214

–

Purchase of shares by employee benefit trust

–

(5)

(38)

Purchase of treasury shares

(151)

(116)

–

Share purchased for cancellation

(503)

–

Other financing cash flows

(8)

(72)

Net cash outflow from financing activities

(3,143)

(1,537)

(1,568)

(Decrease)/Increase in cash and cash equivalents

and bank overdrafts

(855)

1,292

398

Cash and cash equivalents and bank overdrafts at the

beginning of the year

2,207

994

611

Exchange adjustments

(49)

(79)

(15)

(Decrease)/Increase in cash and cash equivalents and

bank overdrafts

(855)

1,292

398

Cash and cash equivalents and bank overdrafts at the

end of the year

1,303

2,207

994

Cash and cash equivalents and bank overdrafts at the

end of the year comprise:

Cash and cash equivalents

1,324

2,250

1,044

Overdrafts

(21)

(43)

(50)

Cash and cash equivalents and bank overdrafts at the

end of the year

1,303

2,207

994

126

Haleon

Annual Report and Form 20-F 2025

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Notes to the Consolidated Financial Statements

1. General information

Haleon is a public company limited by shares, incorporated under the laws of England and Wales with

registered number 13691224. The Company has ordinary shares with a nominal value of £0.01 per share.

The Group’s shares are listed and traded on the London Stock Exchange (LSE) with American Depositary

Shares (ADSs) listed and traded on the New York Stock Exchange (NYSE) (LSE/NYSE: HLN). The registered

address of the Company is Building 5, First Floor, The Heights, Weybridge, Surrey, England, KT13 0NY.

Basis of preparation

The Consolidated Financial Statements have been prepared in accordance with International Financial

Reporting Standards as issued by the International Accounting Standards Board (IASB IFRS), including

interpretations issued by the IFRS Interpretations Committee (IFRIC) and International Financial Reporting

Standards as adopted by the United Kingdom (UK IFRS) (together IFRS) and the Companies Act 2006.

IFRS as adopted by the UK differs in certain respects from IFRS as issued by the IASB. The differences

have no impact on the Group’s Consolidated Financial Statements for the years presented.

Until July 2022, Haleon UK Holdings (No.2) Limited (HHL2) (previously, GlaxoSmithKline Consumer

Healthcare Holdings (No.2) Limited (CHHL2)), the former ultimate holding company of the Group and

the accounting predecessor, was jointly owned by GSK plc and its subsidiaries which held the majority

controlling equity interest of 68%, and Pfizer Inc. and its subsidiaries which held a non-controlling

equity interest of 32%. In July 2022, following the execution of a series of legal acts and contractual

arrangements, including the spin-off to the shareholders of GSK, the Company was established to succeed

HHL2 as the new ultimate holding company of the Group, with 55% of its equity interest held by the

shareholders of GSK, 32% of its equity interest held by Pfizer and approximately 13% of its equity interest

held by GSK. This corporate restructuring was contemplated and executed as one single economic event

yet sequenced via multiple legal proceedings and activities. Management concluded that the predecessor

(carryover) basis of accounting is appropriate because the corporate restructuring was instigated by GSK

and its shareholders without the involvement of outside third parties or new investors.

This set of Consolidated Financial Statements have been prepared as if the Group had been in existence

throughout all the periods presented by applying the principles of predecessor accounting in accordance

with SEC Regulation C Rule 405 and IFRS although the actual legal transaction and corporate

reorganisation occurred in July 2022. There was no economic change or event impacting the reporting

entity because the business activities of the predecessor and successor remained identical and only the

legal form and ownership allocation has changed. These consolidated financial statements were

authorised for issue by the Board of Directors on 13 March 2026.

Accounting convention

The Consolidated Financial Statements are prepared on a historical cost basis unless otherwise indicated.

The Consolidated Financial Statements are presented in Pound Sterling (GBP, £), the functional currency of

the Company and presentation currency of the Group, and all values are denominated in millions of GBP

(£m or £ million) unless stated otherwise.

Financial period

These Consolidated Financial Statements cover the financial year from 1 January 2025 to 31 December

2025, with comparative figures for the financial years from 1 January 2024 to 31 December 2024 and,

where appropriate, from 1 January 2023 to 31 December 2023.

Going concern

The Directors have reviewed the Group’s cash flow forecasts, financial position and exposure to

principal risks and have formed the view that the Group will generate sufficient cash to meet its ongoing

requirements for at least 12 months from the date the Financial Statements have been authorised.

The Directors have performed an additional ‘reverse stress test’ to ensure the going concern assumption

remains appropriate. This incorporates the downside conditions that would cause the Group’s financial

resources to be insufficient to meet its liabilities as they fall due. The ‘reverse stress test’ shows that

forecast Group revenue and profit would have to reduce significantly in order to cause this worst-case

scenario. Given the current financial strength of the Group, the combination of events required to achieve

this scenario is considered highly unlikely to occur.

At 31 December 2025, the Group had cash and cash equivalents, net of bank overdrafts of £1,303m and

undrawn credit facilities of £1,750m with an initial maturity date of August 2028. As a result, the Group’s

Consolidated Financial Statements have been prepared on a going concern basis.

Basis of consolidation

Entities over which the Group has the power to direct the relevant activities so as to affect the returns to

the Group, generally through control over the financial and operating policies from either voting or

contractual rights, are accounted for as subsidiaries. Interests acquired in entities are consolidated from

the date the Group acquires control and interests sold are deconsolidated from the date control ceases.

Where, as part of a business combination, the Group is not able to exercise control over a particular

operation due to the existence of legal or other restrictions, the associated assets and liabilities are not

consolidated, and a financial asset or liability is recognised for the economic benefit or obligation to be

received under the contribution agreement. The assets and liabilities are consolidated, and the associated

financial asset or liability derecognised, on the date at which the Group is able to exercise control over

these operations.

Transactions and balances between subsidiaries are eliminated and no profit before tax is recognised on

sales between subsidiaries until the products are sold to customers outside the Group. Transactions with

non-controlling interests are recorded directly in equity. Deferred tax relief on unrealised intra-group profit

is accounted for only to the extent that it is considered recoverable. Refer to Note 29 ‘Subsidiaries’ for a list

of the Group’s subsidiary undertakings.

Haleon

Annual Report and Form 20-F 2025

127

Notes to the Consolidated Financial Statements

continued

Foreign currencies

The Consolidated Financial Statements are presented in GBP, which is also the Company’s functional

currency. Each entity in the Group determines its own functional currency and items included in the

financial statements of each entity are measured using that functional currency.

Foreign currency transactions in individual Group companies are translated into functional currency using

exchange rates at the date of the transaction. Foreign exchange gains and losses from settlement of these

transactions, and from translation of monetary assets and liabilities at the rates prevailing on the reporting

period date, are recognised in the income statement except when deferred in equity as qualifying hedges.

Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the

rates prevailing at the date when the fair value was measured. Non-monetary items measured in terms of

historical cost in a foreign currency are not retranslated.

In preparing the Consolidated Financial Statements, the balances in individual Group companies are

translated from their functional currency into GBP. The income statement, the cash flow statement and all

other movements in assets and liabilities are translated at average rates of exchange as a proxy for the

transaction rate, or at the transaction rate itself if more appropriate. Assets and liabilities are translated

at the closing rates at the end of the reporting period.

The effect of exchange rate differences during the year on net assets of foreign operations is recorded

in equity.

The Group applies hedge accounting to certain exchange differences arising between the functional

currencies of a foreign operation and the functional currency of the parent entity, regardless of whether

the net investment is held directly or through an intermediate parent. Differences arising on retranslation

of a financial liability designated as a foreign currency net investment hedge are recorded in other

comprehensive income/(expenses) and accumulated in equity to the extent that the hedge is effective,

which may be subsequently reclassified to the consolidated income statement. These differences are

reported within profit or loss to the extent that the hedge is ineffective. Gains and losses on the hedging

instrument accumulated in equity are reclassified to profit or loss on the disposal or partial disposal of the

foreign operation.

The principal currencies and relevant exchange rates in the key markets where the Group operates are

shown below:


Average rates:	2025	2024	2023
USD/£	1.31	1.28	1.24
Euro/£	1.17	1.18	1.15
CNY/£	9.44	9.19	8.81

Accounting for Argentina and Turkey as hyperinflationary economies

The Argentinian and Turkish economies are designated as hyperinflationary for accounting purposes. The

Group has monitored the impact of inflation on its subsidiaries in these countries and does not believe that

inflation had a material impact on the Group prior to 2024. As a result, application of IAS 29 ‘Financial

Reporting in Hyperinflationary Economies’ has been applied to the entities whose functional currency is the

Argentinian Peso or Turkish Lira effective 1 January 2024.

The application of IAS 29 includes:

Adjusting historical cost non-monetary assets and liabilities for the change in purchasing power caused

by inflation from the date of initial recognition to the balance sheet date.

Adjusting the income statement for inflation during the reporting period.

Translating the income statement at the period end foreign exchange rate instead of an average rate.

Adjusting the income statement to reflect the impact of inflation and exchange rate movement on

holding monetary assets and liabilities in local currency.

The main effects of applying IAS 29 on the Group Consolidated Financial Statements are:

Revenue and operating profit for the year ended 31 December 2025 decreased by £2m and £3m (31

December 2024: increased by £37m and £10m) respectively.

A net monetary gain arising from hyperinflationary economies of £2m (31 December 2024: £6m) was

recorded in the income statement reflecting the impact of adjusting the historical cost of non-monetary

assets and liabilities for inflation from 1 January 2025 to 31 December 2025.

Haleon

Annual Report and Form 20-F 2025

128

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

129

Impact of climate change

In preparing these Consolidated Financial Statements we have considered the impact of climate change.

The Group does not believe that there is a material impact on the financial reporting judgements and

estimates arising from climate change in the short term and as a result the valuation of our assets and

liabilities has not been significantly impacted by these risks as at 31 December 2025. In concluding, we

specifically considered the impact of climate change on the following areas:



Financial			Relevant Note for
statement area	Relevant climate-related risks	Relevant ESG targets	further information
Property, plant	- Impact of extreme weather	- Carbon reduction.	Note 12 ‘Property,
and equipment	events on operations and	- Water neutrality at our	plant and equipment’
	supply chain.	manufacturing sites.
	- Policy: carbon pricing.
Goodwill and	- Impact of extreme weather	- Carbon reduction.	Note 14 ‘Intangible
intangible brands	events on operations and	- Recycle-ready packaging.	assets’
	supply chain.	- Sustainably sourced and
	- Reduced availability and	deforestation-free materials.
	increased price volatility of	- Reduced use of virgin
	raw materials due to chronic	petroleum-based plastic.
	climate change.
	- Policy: carbon pricing.
	- Changing consumer
	preferences.
Inventory	- Reduced availability and	- Recycle-ready packaging.	Note 15 ‘Inventories’
	increased price volatility of	- Sustainably sourced and
	raw materials due to chronic	deforestation-free materials.
	climate change.	- Reduced use of virgin
	- Policy: carbon pricing.	petroleum-based plastic.
Going concern	- Impact of extreme weather	-	Viability assessment
and viability	events on operations and
	supply chain.

Whilst there is currently no short-term impact anticipated from climate change, the judgements and

estimates of the Group will be regularly reviewed in light of the increasing risks and dynamic regulatory

landscape as this continues to evolve.

2. Accounting policies

The accounting policies adopted are the same as those which were applied for the previous financial year

except as explained below and hyperinflation accounting outlined in Note 1.

Where an accounting policy is generally applicable to a specific note to the Consolidated Financial

Statements, the policy is described within that note.

The accounting policies below have been applied throughout the Consolidated Financial Statements and

apply to the Financial Statements as a whole.

Revenue

The Group receives revenue for supply of goods to external customers against orders received. The

majority of contracts that the Group enters into relate to sales orders containing single performance

obligations for the delivery of our products.

Product revenue is recognised when control of the goods is passed to the customer. The point at which

control passes is determined by each customer arrangement but generally occurs on delivery to the

customer.

Revenue represents net invoice value (i.e., list price after the deduction of discounts, pricing allowances,

customer incentives, promotional rebates and coupons). Revenue includes fixed and variable consideration.

Variable consideration arises on the sale of goods as a result of discounts and allowances given and

accruals for estimated future returns and rebates. Discounts can either be on-invoice or off-invoice whilst

allowances and rebates are generally off-invoice. The discounts, allowances and promotional rebates are

recognised as a deduction from revenue at the time that the related revenue is recognised or when the

Group has committed to pay the consideration, whichever is later. Variable consideration is not included

in the transaction price until it is highly probable that a significant reversal in the amount of cumulative

revenue recognised will not occur.

The methodology and assumptions used to estimate returns and rebates are monitored and adjusted

regularly in light of contractual and legal obligations, historical trends, past experience and projected

market conditions. Once the uncertainty associated with the returns and rebates is resolved, revenue is

adjusted accordingly. The differences between actual amounts settled and the estimated accrued amounts

are recognised as a change in management estimate in the subsequent reporting period. The assumptions

used in estimation are based on known facts with a high level of accuracy. In addition, the Group’s

promotional programmes are typically short-term in nature resulting in lower inherent estimation

uncertainty.

Some contracts for the sale of consumer health products provide customers with a right to return the

goods within a specified period. A refund liability is recognised for the goods that are expected to

be returned (i.e., the amount not included in the transaction price). A right of return asset (and the

corresponding adjustment to cost of sales) is also recognised for the right to recover the goods from

the customer. The Group uses the most likely amount method to estimate the variable consideration

in contracts with a right to return.

The Group also provides retrospective volume rebates to certain customers once the products purchased

during the period exceed the threshold specified in the contract. A refund liability is recognised for the

expected future rebates (i.e., the amount not included in the transaction price). The Group applies the

most likely amount method to estimate the variable consideration in the contract related to rebates.

Volume rebates and refund liabilities are recognised in trade and other payables.

The Group has elected to apply the practical expedient not to disclose the aggregate amount of

transaction price allocated to performance obligations that are unsatisfied (or partially unsatisfied) as at

the end of the reporting period.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

130

Research and development (R&D)

Research expenditure is charged to the income statement in the period in which it is incurred. Development

expenditure is charged to the income statement in the period in which it is incurred, unless it meets the

requirements of IAS 38 to be capitalised as an intangible asset and then amortised over the useful life of

the developed product.

R&D expenditure comprises expenditure that is directly attributable to the research and development of

new products or variants, including the costs attributable to the generation or improvement of intellectual

property and product registrations, depreciation and amortisation of equipment, real estate and IT assets

used by the R&D function.

Recent accounting developments

IFRS 18 ‘Presentation and Disclosure in Financial Statements’ will replace IAS 1 ‘Presentation of Financial

Statements’ and applies for annual reporting periods beginning on or after 1 January 2027. The new

standard introduces the following key new requirements:

Entities are required to classify all income and expenses into five categories in the statement of profit

or loss, namely the operating, investing, financing, discontinued operations, and income tax categories.

Entities are also required to present a newly defined operating profit subtotal. Entities’ net profit will

not change.

Management-defined performance measures (MPMs) are disclosed in a single note in the financial

statements.

Enhanced guidance is provided on how to group information in the financial statements.

In addition, all entities are required to use operating profit subtotal as the starting point for the statement

of cash flows when presenting operating cash flows under the indirect method.

The Group has established a cross-functional IFRS 18 working group which is currently working to identify

all impacts, the amendments will have on the primary financial statements and notes to the financial

statements. Where required changes have been identified, we have commenced system and reporting

process changes. During 2026, further work will be undertaken to finalise the income statement structure,

statement of cash flows, and MPM disclosures.

All new accounting standards, amendments to accounting standards and interpretations that have been

published by the IASB, and are not effective for 31 December 2025 reporting periods, have not been early

adopted by the Group. Other than IFRS 18, these standards, amendments or interpretations are not

expected to have a material impact on the entity in the current or future reporting periods.

3. Critical accounting judgements and key sources of estimation

uncertainty

In preparing the Consolidated Financial Statements, management is required to make judgements about

when or how items should be recognised in the Consolidated Financial Statements and estimates and

assumptions that affect the amounts of assets, liabilities, income and expenses reported in the

Consolidated Financial Statements. Actual amounts and results could differ from those estimates.

There are no critical accounting judgements. The following is the key source of estimation uncertainty.

Indefinite life brands

Estimation of the recoverable amount of indefinite life brands requires significant estimates of the value of

each brand. The Group reviews indefinite life brands for impairment at least annually or when there is an

indication that the assets may be impaired. The recoverable amounts of indefinite life brands are estimated

using the fair value less costs to sell methodology. These calculations use management’s estimates

consistent with current budgets and plans that have been formally approved, assumptions of market

participants and are based on discounted cash flow forecasts using estimated long-term growth rates.

Refer to Note 14 ‘Intangible assets’ for further details about the Group’s indefinite life brands and

sensitivity analysis of Preparation H. Nexium was reclassified from an indefinite life brand to a definite life

brand during the year.

4. Segment information

Throughout 2025, the Group was organised into business units based on geographical areas and has three

reportable segments:

North America.

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

Asia Pacific (APAC).

No operating segments have been aggregated to form the above reportable operating segments.

Throughout 2025, the Group’s Commercial Operations Board, which consists of the CEO, CFO and other

members of senior leadership, was the Chief Operating Decision Maker (CODM) who monitors the

operating results of the Group’s reportable segments separately for the purpose of making decisions about

resource allocation and performance assessment. The CODM used a measure of adjusted operating profit

to assess the performance of the reportable segments. Adjusted operating profit is defined as operating

profit less net amortisation and impairment of intangible assets, restructuring costs, transaction-related

costs, separation and admission costs, and disposals and others. The CODM did not review IFRS operating

profit or total assets on a segment basis.

The composition of these geographical segments is reviewed on an annual basis. Analysis of revenue and

adjusted operating profit by geographical segment is included below:

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

131

Revenue by segment

| | | | |
| --- | --- | --- | --- |
| | 2025 | 2024 | 2023 |
| | £m | £m | £m |
| North America | 3,866 | 4,042 | 4,195 |
| EMEA & LatAm | 4,592 | 4,631 | 4,545 |
| APAC | 2,572 | 2,560 | 2,562 |
| Group revenue | 11,030 | 11,233 | 11,302 |

Transactions between Haleon’s geographical regions are carried out at arm’s length terms in accordance

with appropriate transfer pricing rules and Organisation for Economic Cooperation and Development

(OECD) principles.

Adjusted operating profit by segment

| | | | |
| --- | --- | --- | --- |
| | 2025 | 2024 | 2023 |
| | £m | £m | £m |
| Group operating profit | 2,412 | 2,206 | 1,996 |
| Reconciling items between Group operating profit and Group | | | |
| adjusted operating profit

1 | 114 | 294 | 553 |
| Total | 2,526 | 2,500 | 2,549 |
| North America | 94

7 | 1,000 | 1,107 |
| EMEA & LatAm | 1,090 | 1,054 | 1,010 |
| APAC | 553 | 539 | 541 |
| Corporate and other unallocated | (64) | (93) | (109) |
| Total | 2,526 | 2,500 | 2,549 |

The reconciling items above include:

a) Net amortisation and impairment of intangible assets of £60m (2024: £147m, 2023: £224m): amortisation and

impairment of intangible assets, excluding computer software and impairment of goodwill net of reversals of

impairment.

b) Restructuring costs of £89m (2024: £214m, 2023: £169m): expenses related to business transformation activities where

the plans are sufficiently detailed and well advanced, and where a valid expectation to those affected has been

created.

c) Disposals and others of £(35)m (2024: £(96)m; 2023: £38m): gains and losses on disposals of assets and businesses, tax

indemnities related to business combinations and other items.

The primary products sold by each of the reportable segments consist of Oral Health, Vitamins, Minerals

and Supplements (VMS), Pain Relief, Respiratory Health, Digestive Health and Therapeutic Skin Health and

Other and the product portfolio is consistent across the reportable segments.

During the year, the Group adopted a new structure for reporting revenue by market category. Compared

to previous reporting, the new structure:

Splits out Digestive Health & Other into Digestive Health, and Therapeutic Skin Health and Other.

Smokers’ Health, which had previously been reported as part of Digestive Health & Other is now

included in Respiratory Health.

There are no changes to other categories.

Revenue by market category

| | | | |
| --- | --- | --- | --- |
| | 2025 | 2024

1 | 2023

1 |
| | £m | £m | £m |
| Oral Health | 3,461 | 3,312 | 3,136 |
| Vitamins, Minerals and Supplements | 1,685 | 1,696 | 1,640 |
| Pain Relie

f | 2,564 | 2,564 | 2,652 |
| Respiratory Health | 1,873 | 2,122 | 2,244 |
| Digestive Health | 98

7 | 1,029 | 1,012 |
| Therapeutic Skin Health and Other | 460 | 510 | 618 |
| Group revenue | 11,030 | 11,233 | 11,302 |

Following the change in market category structure announced on 1 May 2025, 2024 and 2023 figures have been restated.

Revenue attributable to the country of domicile and foreign countries with the most significant contribution

to the Group’s revenue are included below:

Revenue by geography

| | | | |
| --- | --- | --- | --- |
| | 2025 | 2024 | 2023 |
| | £m | £m | £m |
| UK | 374 | 384 | 381 |
| US & Puerto Rico | 3,468 | 3,616 | 3,755 |
| China | 999 | 987 | 966 |
| Rest of the World | 6,189 | 6,246 | 6,200 |
| Group revenue | 11,030 | 11,233 | 11,302 |

Other segmental information

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | | | | Other | |
| | | EMEA & | | reconciling | |
| | North America | LatAm | APAC | items | Total |
| | £m | £m | £m | £m | £m |
| Y

ear ended 31 December 2025 | | | | | |
| Depreciation and amortisation | 91 | 149 | 51 | 69 | 360 |
| Impairment charges | 12 | 4 | 2 | 29 | 4

7 |
| Impairment reversal | – | – | – | – | – |
| Y

ear ended 31 December 2024 | | | | | |
| Depreciation and amortisation | 91 | 144 | 53 | 36 | 324 |
| Impairment charges | 8 | 5 | 1 | 193 | 20

7 |
| Impairment reversal | – | – | – | (15) | (15) |
| Y

ear ended 31 December 2023 | | | | | |
| Depreciation and amortisation | 97 | 124 | 49 | 39 | 309 |
| Impairment charges | 3 | 5 | 2 | 190 | 200 |
| Impairment reversal | – | – | – | – | – |

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

132

Non-current assets attributable to the country of domicile and all foreign countries with significant non-

current assets are included below:


	2025	2024	2023
	£m	£m	£m
UK	302	334	405
US & Puerto Rico	7,17 7	7,523	7,622
Rest of the World	20,168	20,346	20,844
Non-current assets	27,64 7	28,203	28,871

Non-current assets by location exclude derivatives, other investments, deferred tax assets and post-

employment benefit assets.

5. Other operating income/(expense)

Other operating income/expense includes income and expense from all other operating activities which are

not related to the ordinary course of business of the Group, such as gains/losses from disposals and

transaction-related costs.

In 2024, the Group recognised £121m gain on disposal of the Nicotine Replacement Therapy (NRT)

business outside the US. Refer to Note 27 ‘Acquisitions and disposals’ for further details about the business

disposal. In 2025, the Group recognised a further £12m gain in relation to the sale of the NRT business

which took place in 2024.

In 2023, the Group recognised £10m loss on disposal of the Lamisil brand.

6. Operating profit

Expenditure is recognised in respect of goods and services received when supplied in accordance with

contractual terms. Provision is made when an obligation exists for a future liability in respect of a past

event and where the amount of the obligation can be reliably estimated. Advertising and promotion (A&P)

expenditure is charged to the income statement as incurred. Shipment costs on intercompany transfers are

charged to cost of sales; distribution costs on sales to customers are included in selling, general and

administration (SG&A).

Key expenses included in operating profit


	2025	2024	2023
	£m	£m	£m
Advertising and promotion 1	2,256	2,157	2,023
Distribution costs 1	230	239	237
Separation and admission costs	–	30	120
Restructuring costs	89	214	169

Reported within selling, general and administration.

Separation and admission costs represent costs incurred in relation to and in connection with the

separation and listing of the Group as a standalone business in 2022. Separation and admission costs are

reported within cost of sales (2025: £nil, 2024: £1m, 2023: £4m) and the selling, general and administration

expense (2025: £nil, 2024: £29m, 2023: £116m).

Restructuring costs

Restructuring costs are recognised and provided for, where appropriate, in respect of the direct

expenditure of a business reorganisation where the plans are sufficiently detailed and well advanced, and

where a valid expectation to those affected has been created by either starting to implement the

restructuring plans or announcing its main features. Restructuring costs are those mainly related to specific

Board-approved restructuring programmes, including integration costs following material acquisitions,

which are structural in nature and significant in scale.

Restructuring costs include severance and other personnel costs, professional fees, impairments of assets

and other related items.

Haleon may undertake restructuring programmes in response to changes in the Group’s trading

environment and overall strategy or following significant acquisitions. Costs, both cash and non-cash, of

these programmes are provided for as individual elements are approved and meet the accounting

recognition criteria. As a result, charges may be incurred over a number of years following the initiation of a

major restructuring programme.

Restructuring costs in 2025, 2024 and 2023 mainly relate to business transformation activities associated

with our programme to increase productivity and agility. Refer to Note 21 ‘Provisions’ for further details

about the Group’s restructuring provisions.

A breakdown of the restructuring costs is included below:

| | | | |
| --- | --- | --- | --- |
| | 2025 | 2024 | 2023 |
| | £m | £m | £m |
| Cost of sales | 55 | 123 | 26 |
| Selling, general and administration, and other operating expenses | 33 | 90 | 129 |
| Research and development | 1 | 1 | 14 |
| Total | 89 | 214 | 169 |


	2025	2024	2023
	£m	£m	£m
Cash	54	146	168
Non-cash	35	68	1
Total	89	214	169

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

133

Fees payable to the Group’s auditors (and their associates) included in operating profit

In April 2023 KPMG LLP was appointed as external auditor for the Group. A fee breakdown for audit fee is

shown in the table below.


		2025	2024	2023
		£m	£m	£m
KPMG LLP	Audit of Group Consolidated Financial Statements	12	12	11
	Audit of the Company’s subsidiaries	5	5	5
	Audit services	17	17	16
	Other services 1	1	2	1
Total		18	19	17

Other services provided by KPMG relate to permissible tax compliance and advisory services £0.5m (2024: £0.4m), other

audit-related services £0.4m (2024: £1.5m) and other services £0.2m (2024: £0.2m).

7. Employees and remuneration of key management personnel

Employees

The average number of employees by individual geographical segment and the Group’s total employment

costs are included below.

Average number of employees


	2025	2024	2023
	‘ 000	‘000	‘000
North America	4	4	5
EMEA & LatAm	12	13	12
APAC	8	7	7
Total	24	24	24

Aggregate remuneration of all employees including Directors


	2025	2024	2023
	£m	£m	£m
Wages and salaries 1	1,692	1,772	1,751
Social security costs	175	173	176
Pensions and other post-employment costs (Note 20)	25	29	26
Share-based incentive plans (Note 26)	95	117	88
Severance costs from integration and restructuring activities	48	79	108
Total	2,035	2,170	2,149

Included in wages and salaries are costs in relation to defined contribution pension schemes, principally in the US and UK,

of £62m (2024: £60m, 2023: £70m).

Remuneration of key management personnel

Key management personnel comprises the Executive Directors and the Executive Team. The compensation

of key management personnel in respect of their services to the Group in aggregate was as follows:


	2025	2024	2023
	£m	£m	£m
Wages and salaries	23	22	19
Social security costs	5	3	2
Defined contribution schemes	1	1	1
Share-based incentive plans	20	20	15
Non-executive directors fees	2	2	2
Total	51	48	39

The gain on the share awards exercised by Directors in 2025 amounted to £1.8m (2024: £0.1m, 2023: £nil).

This gain reflects the increase in share price between the grant date and the release date.

8. Net finance costs

Net finance costs comprise finance expense and finance income. Finance income includes income on cash and

cash equivalents and income on other financial assets. Finance expense includes interest costs in relation to

financial liabilities including interest on bonds and lease liabilities, which represents the unwind of the discount

rate applied to lease liabilities. Borrowing costs are recognised based on the effective interest method.

Net finance costs


	2025	2024	2023
	£m	£m	£m
Interest income on financial assets at amortised cost:
Cash and cash equivalents	57	65	25
Net gain on financial assets measured at fair value through profit or loss	21	17	7
Net gains and losses arising from:
Financial instruments mandatorily measured at fair value through
profit or loss	–	–	(109)
Retranslation of loans and bonds	–	–	111
Total finance income	78	82	34
Interest expense arising on:
Financial liabilities at amortised cost	(340)	(389)	(409)
Reclassification of hedges from other comprehensive income	22	22	23
Net gains and losses arising from:
Financial instruments mandatorily measured at fair value through
profit or loss	(50)	11	–
Retranslation of loans and bonds	50	(13)	–
Finance expense arising on lease liabilities	(7)	(5)	(5)
Other finance expense	(15)	(10)	(11)
Total finance expense	(340)	(384)	(402)
Net finance costs	(262)	(302)	(368)

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

134

9. Taxation

Income tax

Income tax expense represents the sum of the current and deferred taxes.

Current tax payable or recoverable is based on taxable profit for the year, and any adjustments in respect

of prior periods. Taxable profit differs from profit as reported in the income statement because some items

of income or expense are taxable or deductible in different years or may never be taxable or deductible.

The amount of current tax payable or receivable is the best estimate of the amount expected to be paid to,

or received from, tax authorities. It is calculated using tax rates and laws that have been substantively

enacted at the reporting date. In addition to ordinary income tax expense, total current tax includes any

global minimum top-up taxes that might be due under Pillar Two legislation.

Tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets

against current tax liabilities and when they either relate to income taxes levied by the same taxation

authority on either the same taxable entity or on different taxable entities which intend to settle the

current tax assets and liabilities on a net basis.

Tax is charged or credited to the income statement, except when it relates to items charged or credited to

other comprehensive income/(expense) or directly to equity, in which case the tax is recognised in other

comprehensive income/(expense) or in equity.

The Group recognises provisions for uncertain tax positions when it is probable that a tax authority would

not accept an uncertain tax treatment. This is done by assuming the tax authority will examine all the

amounts and would have full knowledge of all related information when making those examinations.

Uncertain tax positions are assessed and measured on an issue-by-issue basis within the jurisdictions that

we operate either using management’s estimate of the most likely outcome where the issues are binary,

or the expected value approach where the issues have a range of possible outcomes.

Where open tax matters exist, the ultimate liability for such matters may vary from the amounts provided

and is dependent upon the outcome of negotiations with the relevant tax authorities or, if necessary,

litigation proceedings. At 31 December 2025, the Group had recognised provisions of £122m in respect

of such uncertain tax positions (2024: £124m, 2023: £148m). Due to the number of uncertain tax positions

held and the number of jurisdictions to which these relate, it is not practicable to give meaningful

sensitivity estimates.

The Group recognises interest on late paid taxes as part of financing costs, and any penalties, if applicable,

as part of the income tax expense.

Tax charged to the income statement

The major components of income tax expense are:

Taxation charge/(credit) based on profits for the period



	2025	2024	2023
	£m	£m	£m
Current year charge	529	608	570
Charge in respect of prior periods	(20)	(62)	(31)
Pillar Two income tax	2	3	–
Total current taxation	511	549	539
Total deferred taxation	(39)	(114)	(22)
Total	472	435	51 7

The tax charge on the Group’s profit for the year can be reconciled from the standard rate of corporation

tax in the UK of 25% (2024: 25%, 2023: 23.5%) as follows:

Reconciliation of the taxation rate on the Group’s profit



	2025	2024	2023
	£m	£m	£m
Profit before tax	2,152	1,910	1,628
UK statutory rate of taxation of 25% (2024: 25%, 2023: 23.5%)	538	478	383
Differences in overseas taxation rates	(26)	(18)	(2)
Benefit of substance-based tax rulings	(7)	(5)	(21)
R&D tax credits	(8)	(6)	(6)
Tax losses not recognised	(4)	–	–
Permanent differences on disposals, acquisitions and transfers	–	(35)	155
Items non-deductible/taxable for tax purposes	43	64	55
Reassessment of prior year estimates	(2)	(50)	(65)
Changes in tax rates	(62)	7	18
Total tax charge	472	435	51 7

The Group has a substantial business presence in many countries around the world. The effect of overseas

tax rates represents the tax impact on profits arising outside the UK that are then taxed at rates different

to the statutory rate in the UK. In 2023, the impact was smaller due to a lower UK statutory rate of tax

applicable in that year.

The tax effect of disposals, acquisitions and transfers can vary from the accounting profit or loss that arises.

The credit recorded in 2024 relates to a business divestment, whilst the 2023 charge related to the

deferred tax impact of intra-group transfers.

Items non-deductible/taxable for tax purposes include irrecoverable withholding taxes, charges on

controlled foreign companies, as well as other costs that are not deductible for tax purposes.

The reassessment of prior year estimates includes settlements reached following conclusion of tax

authority reviews, differences between final tax return submissions and liabilities accrued in the financial

statements and the release of prior year uncertain tax positions. In 2023, this also included a one-off

deferred tax credit of £37m.

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

135

The impact of changes in tax rates results from the revaluation of temporary differences due to a difference

in applicable tax rates. In 2025, this primarily relates to changes in the blended rate of state tax that

is applicable in the United States along with new legislation substantively enacted in Germany that

progressively decreases the applicable tax rate from 2027. In 2023, this primarily related to new Cantonal

legislation substantively enacted in Switzerland that increases the applicable tax rate from 2025.

Future tax charges, and therefore the effective tax rate, may be affected by factors such as acquisitions,

disposals, restructurings, the location of research and development activity, tax regime reforms, agreements

with tax authorities and resolution of open matters as the Group continues to bring its tax affairs up to date

around the world.

In addition to the amounts charged to the income statement, tax of £3m has been credited directly to

equity or through comprehensive income/(expense) (2024: £3m credit, 2023: £6m credit) of which a £3m

credit (2024: £1m credit, 2023: £5m credit), is included in current tax and £nil (2024: £2m credit, 2023: £1m

credit) is included in deferred tax. This principally relates to cash flow hedges, post-employment benefits

and share based compensation.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable in the future arising from temporary

differences between the carrying amounts of assets and liabilities in the financial statements and the

corresponding tax bases used in the computation of taxable profit. It is accounted for using the statement

of financial position liability method. Deferred tax liabilities are generally recognised for all taxable

temporary differences and deferred tax assets are recognised to the extent that it is probable that

temporary differences or taxable profits will be available against which deductible temporary differences

can be utilised.

Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition

(other than in a business combination) of assets and liabilities in a transaction that affects neither the

taxable profit nor the accounting profit. Deferred tax liabilities are not recognised to the extent they arise

from the initial recognition of non-tax deductible goodwill. In addition, the Group has neither recognised

nor disclosed information about deferred tax assets or liabilities relating to Pillar Two income taxes as

required by the temporary, mandatory deferred tax exception to IAS 12.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in

subsidiaries and associates, and interests in joint arrangements, except where the Group is able to control

the reversal of the temporary difference and it is probable that the temporary difference will not reverse

in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each reporting period date and adjusted to

reflect changes in the Group’s assessment that sufficient taxable profits will be available to allow all or

part of the assets to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in

the period when the liability is settled or the asset realised, based on tax rates that have been enacted or

substantively enacted by the reporting period date.

Deferred tax assets and liabilities comprise of:



	2025	2024
	£m	£m
Deferred tax assets	289	276
Deferred tax liabilities	(3,222)	(3,353)
Total	(2,933)	(3,077)

Movement in deferred tax assets and liabilities



			Pensions &
	Accelerated		other post-		Intra-	Other net
	capital		employment		group	temporary
	allowances	Intangibles	benefits	Tax losses	profit	differences	Total
	£m	£m	£m	£m	£m	£m	£m
As at 1 January 2025	(93)	(3,474)	23	13	110	344	(3,077)
Hyperinflation adjustment	–	1	–	–	–	–	1
Exchange adjustments	4	110	(1)	(1)	1	(9)	104
(Charge)/credit to income
statement	(13)	45	(2)	(3)	2	10	39
(Charge)/credit to statement of
comprehensive income	–	–	(6)	–	–	5	(1)
Credit directly to equity	–	–	–	–	–	1	1
At 31 December 2025	(102)	(3,318)	14	9	113	351	(2,933)



			Pensions &
	Accelerated		other post-		Intra-	Other net
	capital		employment		group	temporary
	allowances	Intangibles	benefits	Tax losses	profit	differences	Total
	£m	£m	£m	£m	£m	£m	£m
As at 1 January 2024	(94)	(3,613)	32	11	175	26 7	(3,222)
Hyperinflation adjustment	(3)	(2)	–	–	–	(1)	(6)
Exchange adjustments	–	19	(1)	–	(11)	(7)	–
Credit/(charge) to income
statement	4	87	(1)	2	(54)	76	114
(Charge)/credit to statement of
comprehensive income	–	–	(7)	–	–	9	2
Arising on business
acquisitions/disposals	–	35	–	–	–	–	35
At 31 December 2024	(93)	(3,474)	23	13	110	344	(3,077)

Provision for deferred tax liabilities of £32m (2024: £34m) has been made in respect of the taxation that

would arise on the future distribution of retained profits by certain overseas subsidiaries. Deferred tax

is not provided on temporary differences of £187m (2024: £218m) arising on unremitted profits as

management can control any future reversal and does not consider such a reversal to be probable.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

136

The Group has recognised a deferred tax asset for trading losses of £9m (2024: £12m) on the basis of

management forecasts which demonstrate these losses should be recovered in the foreseeable future. No

deferred tax asset has been recognised in respect of gross trading losses of £178m (2024: £195m) due to

the unpredictability of future profits. Included in this unrecognised amount are US state tax losses of

£108m (2024: £127m) which can only be carried forward for between 15 and 20 years. These losses expire

at various dates over the next 10 years (2024: 12 years). Other unrecognised trading losses may be carried

forward indefinitely.

A deferred tax asset of £nil (2024: £1m) has been recognised for capital tax losses available for offset

against future capital receipts. The gross value of capital losses for which no deferred tax asset is

recognised is £nil (2024: £26m) as all preexisting capital losses have been utilised, or have expired, during

the current year.

10. Dividends

Dividends are recognised on the date that the shareholder’s right to receive payment is established.

Interim dividends are recognised when they become payable to Company’s shareholders. Final dividends

are recognised when they are approved by shareholders. The Board are proposing a final dividend for the

year ended 31 December 2025 of 4.9p per ordinary share. Subject to shareholder approval at the AGM, it

will be paid on 14 May 2026 to holders of ordinary shares and ADS on the register as of 10 April 2026.

Dividends declared and paid during the year


	2025			2024			2023
		Dividend	Total		Dividend	Total		Dividend	Total
	Paid/	per share	dividend	Paid/	per share	dividend	Paid/	per share	dividend
	payable	(pence)	(£m)	payable	(pence)	(£m)	payable	(£m)	(£m)
	18 Sep
2025 interim dividend	2025	2.2	19 7	–	–	–	–	–	–
	5 June
2024 final dividend	2025	4.6	415	–	–	–	–	–	–
	–	–	–	19 Sep
2024 interim dividend				2024	2.0	182	–	–	–
	–	–	–	16 May
2023 final dividend				2024	4.2	388	–	–	–
	–	–	–				5 Oct
2023 interim dividend				–	–	–	2023	1.8	166
	–	–	–				27 Apr
2022 final dividend				–	–	–	2023	2.4	222

11. Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to shareholders by the Company’s

weighted average number of share units in issue during the year after deducting treasury shares or shares

held by employee benefit trusts (EBTs) if any.

Diluted earnings per share has been calculated after adjusting the weighted average number of shares

used in the basic calculation to assume the conversion of all potentially dilutive shares.

Earnings per share


	2025	2024	2023
Profit after tax attributable to equity shareholders (£m)	1,66 7	1,442	1,049
Weighted average number of shares (million)	9,004	9,142	9,235
Less: weighted average number of treasury shares and shares held
by EBTs (million) 1	(22)	(10)	(2)
Basic weighted average number of shares (million)	8,982	9,132	9,233
Effect of dilutive potential shares (million)	44	43	30
Diluted weighted average number of shares (million)	9,026	9,175	9,263
Basic earnings per share (pence)	18.6	15.8	11.4
Diluted earnings per share (pence)	18.5	15.7	11.3

The total number of shares held as at 31 December 2025 was 47.0m, of which 45.7m were treasury shares. The impact of

these shares on the basic weighted average number of shares was only 22m because these shares were acquired towards

the end of the accounting period. These shares were acquired to meet the equity-settled share-based payment

obligations vesting in Q1 2026.

12. Property, plant and equipment

Land, buildings, plant, equipment and vehicles are valued at their cost, less any accumulated depreciation

and any accumulated impairment losses.

Assets under construction are carried at cost, less any recognised impairment losses. Depreciation of these

assets commences when the assets are ready for their intended use.

The cost of property, plant and equipment includes directly attributable incremental costs incurred in

acquisition and installation of the assets.

Depreciation is recognised on a straight-line basis, over the estimated useful lives of the asset. Residual

values and useful lives are reviewed, and where appropriate adjusted annually. Estimated useful lives of

the major categories of assets are shown below:


Freehold buildings	20 to 50 years
Leasehold land and buildings	Lease term or 20 to 50 years
Plant and machinery	10 to 20 years
Equipment and vehicles	3 to 10 years

Property, plant and equipment is subject to review for impairment if triggering events or circumstances

indicate an impairment may exist. If an indication of impairment exists, the recoverable amount of the asset

or cash generating unit is estimated and any impairment loss is charged to the income statement as it arises.

Strategic

Corporate

Consolidated

Parent Company

Other

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Haleon

Annual Report and Form 20-F 2025

137

Where there has been a change in the estimates used to determine recoverable amount and an impairment

loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its

recoverable amount, not to exceed the carrying amount that would have been determined had no

impairment loss been recognised for the asset in prior years and an impairment loss reversal is recognised

immediately in the income statement.

On disposal of property, plant and equipment, the cost and related accumulated depreciation and

impairments are derecognised from the Consolidated Financial Statements and the net amount, less any

proceeds, is taken to the income statement.

Property, plant and equipment

| | | | | |
| --- | --- | --- | --- | --- |
| | | Plant, | Assets | |
| | Land and | equipment | under | |
| | buildings | and vehicles | construction | Total |
| | £m | £m | £m | £m |
| Cost at 1 January 2024 | 970 | 1,708 | 373 | 3,051 |
| Hyperinflation adjustment | 3 | 6 | 4 | 13 |
| Exchange adjustments | (11) | (25) | (10) | (46) |
| Additions | – | – | 250 | 250 |
| Additions from business acquisitions | (2) | 1 | – | (1) |
| Disposals and write-offs | (2) | (32) | (3) | (37) |
| Reclassifications | 54 | 231 | (276) | 9 |
| Cost at 31 December 2024 | 1,012 | 1,889 | 338 | 3,239 |
| Hyperinflation adjustment | 1 | 1 | – | 2 |
| Exchange adjustments | (19) | (19) | (8) | (46) |
| Additions | 4 | 8 | 310 | 322 |
| Disposals and write-offs | (5) | (57) | (17) | (79) |
| Reclassifications | 51 | 181 | (235) | (3) |
| Cost at 31 December 2025 | 1,044 | 2,003 | 388 | 3,435 |
| Depreciation at 1 January 2024 | (330) | (925) | – | (1,255) |
| Hyperinflation adjustment | – | (3) | – | (3) |
| Exchange adjustments | 1 | 12 | – | 13 |
| Charge for the year | (34) | (138) | – | (172) |
| Disposals and write-offs | 1 | 29 | – | 30 |
| Reclassifications | – | (4) | – | (4) |
| Depreciation at 31 December 2024 | (362) | (1,029) | – | (1,391) |
| Hyperinflation adjustment | – | 1 | – | 1 |
| Exchange adjustments | 7 | 7 | – | 14 |
| Charge for the year | (36) | (153) | – | (189) |
| Disposals and write-offs | 4 | 50 | – | 54 |
| Reclassifications | – | – | – | – |
| Depreciation at 31 December 2025 | (387) | (1,124) | – | (1,511) |


		Plant,	Assets
	Land and	equipment	under
	buildings	and vehicles	construction	Total
	£m	£m	£m	£m
Impairment at 1 January 2024	(3)	(6)	(7)	(16)
Exchange adjustments	–	1	1	2
Impairment losses	(1)	(17)	(15)	(33)
Disposals and write-offs	1	3	3	7
Reclassifications	–	1	–	1
Impairment at 31 December 2024	(3)	(18)	(18)	(39)
Exchange adjustments	1	(2)	–	(1)
Impairment losses	(2)	(30)	(1)	(33)
Disposals and write-offs	1	5	14	20
Reclassifications	–	–	–	–
Impairment at 31 December 2025	(3)	(45)	(5)	(53)
Depreciation and impairment at 31 December 2024	(365)	(1,047)	(18)	(1,430)
Depreciation and impairment at 31 December 2025	(390)	(1,169)	(5)	(1,564)
Net book value at 31 December 2024	64 7	842	320	1,809
Net book value at 31 December 2025	654	834	383	1,871

Impairment losses charged to cost of sales for 2025 is £27m (2024: £27m, 2023: £nil) and £6m for 2025

(2024: £6m, 2023: £7m) has been charged to selling, general and administration.

Reversals of impairment arise from subsequent reviews of the impaired assets where the conditions which

gave rise to the original impairments are deemed no longer to apply. There were no impairment reversals

credited to cost of sales in the years presented.

Reclassifications include £(3)m for 2025 (2024: £6m, 2023: £22m) related to assets under construction that

have been reclassified to computer software in intangible assets during the year.

Impact of climate change

The impact of damage and disruption caused by extreme weather events on the useful lives of property,

plant and equipment were considered. Management undertook a modelling exercise to estimate the

potential impact that extreme weather events could have on the Group’s manufacturing sites. Management

considered that the hazards with the greatest potential impact over the long-term time horizon are riverine

and flash flooding, and heatwaves. Given the geographical spread of the Group’s manufacturing sites, the

prospect of every site being impacted in any given year, or for every year, is considered remote and as a

result, the level of loss potentially arising would not be considered significant for the Group. In addition,

the majority of the Group’s assets have useful lives that end ahead of the medium- to long-term timescales

expected for extreme climate events to occur. Therefore, we consider that there is no material impairment

risk on the property, plant, and equipment balances for the year as a result of climate change.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

138

13. Right of use assets

When the Group leases an asset, a ‘right of use asset’ is recognised for the leased item and a lease liability

is recognised for any lease payments to be paid over the lease term at the lease commencement date

except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low-

value assets (defined as assets with an initial fair value less than approximately £10,000).

The right of use asset is initially measured at cost, being the present value of the lease payments paid or

payable, plus any initial direct costs incurred in entering into the lease and less any lease incentives

received. Non-lease components are accounted for separately from the lease components in plant and

equipment leases but are not separately accounted for in land and buildings or vehicle leases.

Right of use assets where title is expected to pass to the Group at a point in the future are depreciated in a

manner consistent to that for owned property, plant and equipment. In other cases, right of use assets are

depreciated over the shorter of the useful life of the asset or the lease term. The lease term is the non-

cancellable period of the lease plus any periods for which the Group is reasonably certain to exercise any

extension options. If right of use assets are considered to be impaired, the carrying value is reduced

accordingly.

Lease liabilities are initially measured at the value of the lease payments over the lease term that are not

paid at the commencement date and are usually discounted using the incremental borrowing rates of the

applicable Group entity (the rate implicit in the lease is used if it is readily determinable). Lease payments

included in the lease liability include both fixed payments and in-substance fixed payments during the term

of the lease.

After initial recognition, the lease liability is recorded at amortised cost using the effective interest method.

It is remeasured when there is a change in future lease payments or if the Group’s assessment of the lease

term changes; any changes in the lease liability as a result of these changes also results in a corresponding

change in the recorded right of use asset.

Right of use assets

| | | | | |
| --- | --- | --- | --- | --- |
| | Land and | Plant and | | |
| | buildings | equipment | Vehicles | Total |
| | £m | £m | £m | £m |
| Net book value at 1 January 2024 | 105 | 1 | 16 | 122 |
| Exchange adjustments | (3) | – | (1) | (4) |
| Additions | 29 | – | 19 | 48 |
| Depreciation | (39) | (1) | (13) | (53) |
| Disposals and write-offs | (1) | – | – | (1) |
| Net book value at 31 December 2024 | 91 | – | 21 | 112 |
| Exchange adjustments | (2) | 1 | (1) | (2) |
| Additions | 49 | 1 | 1

7 | 6

7 |
| Depreciation | (38) | (1) | (12) | (51) |
| Net book value at 31 December 2025 | 100 | 1 | 25 | 126 |

The total cash outflow for leases amounted to £60m in 2025 (2024: £60m, 2023: £55m). The Group has

lease commitments relating to leases that have not commenced at year end of £14m (2024: £2m, 2023:

£1m). Refer to Note 19 ‘Borrowings’ for further details on the Group’s lease liabilities.

14. Intangible assets

Goodwill

Goodwill arising on consolidation represents the excess of the fair value of the consideration transferred

over the fair value of the Group’s share of the identifiable assets and liabilities of the acquired subsidiaries

at the date of acquisition. Goodwill is not subject to amortisation but is tested annually for impairment,

or more frequently where indicators of impairment exist, and is carried at cost less any accumulated

impairment losses.

For the purpose of impairment testing, assets are grouped in cash generating units (CGUs). A CGU is

identified as the lowest aggregation of assets that generate largely independent cash inflows, and which

is looked at by management for monitoring and managing the business.

If the recoverable amount of the CGU is less than the carrying amount, an impairment loss is allocated

first to reduce the carrying amount of any goodwill allocated to the CGU and then to the other assets of

the CGU pro rata on the basis of the carrying amount of each asset in the CGU. Any impairment loss is

immediately recognised in the consolidated income statement and an impairment loss recognised for

goodwill is not subsequently reversed.

The recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing

value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount

rate that reflects current market assessments of the time value of money and the risks specific to the asset

for which the estimates of future cash flows have not been adjusted.

Management uses the approved three-year strategic plan and the projected cash flows for a further

two-year period as the basis for the Group CGUs’ value in use calculations.

On disposal, the attributable amount of goodwill is included in the determination of the gain or loss on

disposal.

Other intangibles

Intangible assets are recognised when they are identifiable, the Group controls the asset, it is probable

that future economic benefits attributed to the asset will flow to the Group and the cost of the asset can

be reliably measured.

Separately purchased brands are initially measured at cost, being the purchase price as at the date of

acquisition. Acquired brands are valued independently and recognised at fair value when the Group

completes a business combination from third parties, where brands have a value which is substantial and

long term and where the brands either are contractual or legal in nature or can be sold separately from the

rest of the businesses acquired. The determination of the fair values of the separately identified intangibles

is based, to a considerable extent, on management’s judgement. Brands are amortised over their estimated

useful lives of up to 20 years, except where it is considered that the useful economic life is indefinite.

Strategic

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Haleon

Annual Report and Form 20-F 2025

139

Indefinite life brands mainly comprise trademarks and brands for which there is no foreseeable limit to

the period over which they are expected to generate net cash inflows. These are considered to have an

indefinite life, given the strength and durability of the brands and the level of advertising and promotion

support. These brands are in relatively similar, stable and profitable market sectors, with similar risk

profiles, and their size, diversification and market shares mean that the risk of market-related factors

causing a reduction in the lives of the brands is considered to be relatively low. The Group is not aware of

any material legal, regulatory, contractual, competitive, economic or other factors which could limit their

useful lives. Accordingly, they are not amortised.

Intangible assets are stated at cost less provisions for amortisation and impairments. Licences, patents,

know-how and marketing rights separately acquired or acquired as part of a business combination are

amortised over their estimated useful lives, generally not exceeding 20 years, using the straight-line basis

from the time they are available for use. The estimated useful lives for determining the amortisation charge

consider patent lives, where applicable, as well as the value obtained from periods of non-exclusivity.

Asset lives are reviewed and, where appropriate, adjusted annually.

Any development costs incurred by the Group and associated with acquired licences, patents, know-how

or marketing rights are written off to the income statement when incurred.

The costs of acquiring and developing computer software for internal use and internet sites for external

use are capitalised as intangible fixed assets where the software or site supports a significant business

system and the expenditure leads to the creation of an asset. Enterprise Resource Planning (ERP) systems

software is amortised over 7-10 years and other computer software over 3-5 years.

The carrying values of all non-current assets are reviewed for impairment, either on a standalone basis

or as part of a larger CGU, when there is an indication that the assets might be impaired. Additionally,

intangible assets with indefinite useful lives and intangible assets which are not yet available for use

are tested for impairment annually. Any provision for impairment is charged to the income statement.

If the recoverable amount of an intangible asset is less than the carrying amount, an impairment loss is

recognised in the income statement. The recoverable amount is the higher of fair value less costs of

disposal and value in use. Impairment losses are only reversed if there has been a change in estimates

used to determine recoverable amounts and only to the extent that the revised recoverable amounts

do not exceed the carrying values that would have existed, net of amortisation, had no impairments

been recognised.

Intangible assets

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | | | Amortised | | | |
| | | | brands, | | | |
| | | Indefinite | licences | | Assets | |
| | | life | and | Computer | under | |
| | Goodwill | brands | patents | software | construction | Total |
| | £m | £m | £m | £m | £m | £m |
| Cost at 1 January 2024 | 8,31

7 | 18,213 | 391 | 542 | 83 | 27,546 |
| Hyperinflation adjustments | 1 | 7 | – | 3 | – | 11 |
| Exchange adjustments | 17 | (80) | (2) | (3) | 1 | (67) |
| Additions | – | 8 | 4 | 4 | 58 | 74 |
| Disposals and write-offs | – | – | (1) | (8) | (32) | (41) |
| Reclassifications | – | – | (2) | 45 | (49) | (6) |
| Transfer to assets held for sale | (133) | (247) | – | – | – | (380) |
| Cost at 31 December 2024 | 8,202 | 17,901 | 390 | 583 | 61 | 27,13

7 |
| Hyperinflation adjustments | (1) | (1) | – | – | – | (2) |
| Exchange adjustments | (72) | (482) | (15) | (6) | 1 | (574) |
| Additions | – | – | 1 | 2 | 88 | 91 |
| Disposals and write-offs | – | – | – | (19) | (1) | (20) |
| Reclassifications | – | (682) | 682 | 50 | (49) | 1 |
| Cost at 31 December 2025 | 8,129 | 16,736 | 1,058 | 610 | 100 | 26,633 |
| Amortisation at 1 January 2024 | – | – | (211) | (321) | – | (532) |
| Hyperinflation adjustments | – | – | – | (2) | – | (2) |
| Exchange adjustments | – | – | – | 2 | – | 2 |
| Charge for the period | – | – | (24) | (75) | – | (99) |
| Disposals and write-offs | – | – | – | 4 | – | 4 |
| Amortisation at 31 December 2024 | – | – | (235) | (392) | – | (627) |
| Hyperinflation adjustments | – | – | – | – | – | – |
| Exchange adjustments | – | – | 4 | 2 | – | 6 |
| Charge for the period | – | – | (51) | (69) | – | (120) |
| Disposals and write-offs | – | – | – | 1

7 | – | 1

7 |
| Reclassifications | – | – | – | 2 | – | 2 |
| Amortisation at 31 December 2025 | – | – | (282) | (440) | – | (722) |

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

140

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | | | Amortised | | | |
| | | | brands, | | | |
| | | | licences | | Assets | |
| | | Indefinite | and | Computer | under | |
| | Goodwill | life brands | patents | software | construction | Total |
| | £m | £m | £m | £m | £m | £m |
| Impairment at 1 January 2024 | – | (140) | (9) | (10) | – | (159) |
| Exchange adjustments | – | (3) | – | – | – | (3) |
| Impairment losses | – | (135) | (3) | (4) | (32) | (174) |
| Disposals and write-offs | – | – | 1 | 4 | 32 | 3

7 |
| Impairment at 31 December 2024 | – | (278) | (11) | (10) | – | (299) |
| Exchange adjustments | – | 12 | (1) | 1 | – | 12 |
| Impairment losses | (2) | (7) | – | (4) | (1) | (14) |
| Reclassifications | – | 131 | (131) | – | – | – |
| Disposals and write-offs | – | – | – | 2 | 1 | 3 |
| Impairment at 31 December 2025 | (2) | (142) | (143) | (11) | – | (298) |
| Amortisation and impairment at 31 | | | | | | |
| December 2024 | – | (278) | (246) | (402) | – | (926) |
| Amortisation and impairment at 31 | | | | | | |
| December 2025 | (2) | (142) | (425) | (451) | – | (1,020) |
| Net book value at 31 December 2024 | 8,202 | 17,623 | 144 | 181 | 61 | 26,211 |
| Net book value at 31 December 2025 | 8,12

7 | 16,594 | 633 | 159 | 100 | 25,613 |

The net book value of computer software included £71m (2024: £84m, 2023: £122m) of internally

generated costs.

Goodwill impairment

Goodwill mainly arose from the Novartis Transaction in 2015 (£2.6bn) and the Pfizer Transaction in 2019

(£5.6bn).

Goodwill is allocated to the Group’s CGUs as follows:


	2025	2024
	£m	£m
North America	3,258	3,230
EMEA & LatAm	2,855	2,827
APAC	2,014	2,145
Net book value at 31 December	8,12 7	8,202

The recoverable amounts of the CGUs are assessed using a value in use model (2024: value in use). Value

in use is calculated using a discounted cash flow approach, with a pre-tax discount rate applied to the

projected risk-adjusted pre-tax cash flows and terminal value.

The discount rate used is based on the pre-tax weighted average cost of capital (WACC) of the CGUs.

The discount rates are specific to each CGU and are determined based on the cost of capital, including a

market premium and country-specific political risk premiums.

Details relating to the discounted cash flow model used in the impairment tests of the APAC, EMEA &

LatAm, and North America CGUs are as follows:


Valuation basis	Value in use
Key assumptions	Sales growth rates
	Profit margins
	Terminal growth rates
	Discount rates
	Taxation rates
Determination of	Growth rates are internal forecasts based on both internal and external market
assumptions	information
	Margins reflect past experience, adjusted for expected changes
	Terminal growth rates are based on internal projections and external forecasts
	of the relevant markets
	Discount rates are based on the Group WACC, adjusted where appropriate
	Taxation rates are based on appropriate rates for each CGU
Period of specific
projected cash flows	Five years
Terminal growth rates		2025	2024
	North America	2.2% p.a.	2.1% p.a.
	EMEA & LatAm	2.6% p.a.	2.7% p.a.
	APAC	2.3% p.a.	2.3% p.a.
Discount rates (pre-tax)		2025	2024
	North America	8.9%	7.4%
	EMEA & LatAm	11.9%	11.2%
	APAC	10.3%	9.4%

The terminal growth rate does not exceed the long-term projected growth rate for the Group. Goodwill

is monitored for impairment at individual CGU level. In each case, the valuation indicated substantial

headroom such that it is remote that a reasonably possible change to key assumptions would result in an

impairment of goodwill.

Strategic

Corporate

Consolidated

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Other

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Haleon

Annual Report and Form 20-F 2025

141

Indefinite life brands and amortised brands impairment

Indefinite life brands comprise a portfolio of consumer health products. The net book value of the major

brands is as follows:


	2025	2024
	£m	£m
Advil	3,348	3,527
Voltaren	2,725	2,725
Centrum	1,762	1,798
Caltrate	1,609	1,662
Otrivin	1,385	1,385
Robitussin	1,10 7	1,173
Preparation H	1,042	1,108
Fenistil	598	598
Nexium 1	–	574
Emergen-C	439	470
Theraflu	436	446
Panadol	395	395
Sensodyne	275	276
Excedrin	17 7	189
Polident	129	126
Biotene	121	127
Vitasprint	118	113
Corega	116	110
Other brands	812	821
Total	16,594	17,623

Nexium was reclassified from indefinite life brand to definite life brand during the year ended 31 December 2025.

The Group tests all its indefinite life brands for impairment by applying a fair value less costs to sell model

using a three-year strategic plan approved by management and cash flows beyond the three-year period

are extrapolated using the terminal growth rates. All brands were tested for impairment using brand-

specific assumptions which included a discount rate equal to the Group’s post-tax WACC of 7.0% (2024:

7.0%; 2023: 7.5%) adjusted where appropriate for country and currency risks, and applied to the post-tax

cash flows. This valuation methodology uses significant inputs which are not based on observable market

data, and therefore this valuation technique is classified as level 3 of the fair value hierarchy. In addition to

the discount rate, the main assumptions include future sales price and volume growth, product contribution

and the future expenditure required to maintain the product’s marketability and registration in the relevant

jurisdictions. These assumptions are based on past experience and are reviewed as part of management’s

budgeting and strategic planning cycle. The terminal growth rates applied of between 0% and 2.5%

(2024: 0% to 2.5%, except Nexium where terminal growth was (2%), 2023: 0% and 3%) are management’s

estimates which align with those of market participants’ estimate of future long-term average growth rates

for the relevant markets.

In 2025, the Group recorded a non-cash impairment of £7m linked to sales and volume decline of smaller

brands. During the year, the Group reclassified Nexium, previously considered to have an indefinite useful

life, to an amortised brand with a definite useful life. Amortisation has been recognised using the straight-

line method. This change in classification was driven by the challenging market conditions both for the

brand and the category. Nexium was assessed for impairment prior to reclassification, and no further

impairment loss was recognised.

Additionally, in 2025, the carrying value of Preparation H continues to be sensitive to reasonably possible

changes in the key assumption of the discount rate. The post-tax discount rate used for the brand is 6.75%

(2024: 6.5%) primarily driven by an increase in United States equity risk premium and the brand’s terminal

growth rate is 2.1% (2024: 2.1%) in line with external forecasts for the category. If the discount rate for

Preparation H had been 0.5% higher than management’s estimates, the Group would have had to recognise

an impairment of £90m (2024: £97m).

Other than as disclosed above, management does not consider that any reasonably possible changes in

the key assumptions would cause the fair value less costs to sell of the individually significant brands

disclosed above to fall below their carrying values.

In 2024, the Group recorded a non-cash impairment charge of £135m for Nexium since the carrying value of

the brand was higher than the recoverable amount. The decrease in recoverable amount was mainly driven

by challenging market conditions for the category. The post-tax discount rate used for the brand was 6.5%

(2023: 7.5%) primarily driven by a decline in the cost of debt and a negative terminal growth rate of 2%

(2023: 0%) driven by the factors affecting brand performance noted above. The revenue growth rate

assumed for the next three years was (8)%. If the revenue growth rate for Nexium had been 2.5% lower or

the terminal growth rate had been 0.5% lower than management’s estimates, the Group would have had to

recognise a further impairment of £13m or £6m, respectively.

In 2023, the Group recorded a non-cash impairment charge of £170m upon signing a definitive agreement

to dispose of ChapStick. The disposal of this indefinite life brand was completed in May 2024. In addition,

the Group also recorded an impairment of £15m relating to a collection of smaller brands as these brands

were experiencing sales volume decline year on year.

In 2022, the Group recorded an impairment charge of £111m for Preparation H since the carrying value of

the brand was higher than the recoverable amount. The decrease in recoverable amount was mainly driven

by an increase in the discount rate applied to the forecasted future cash flows from 6% to 6.75%.

A breakdown of the amortisation, impairment losses and reversals is included below:

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | | | | Net impairment | | |
| | Amortisation | | | losses/(reversals) | | |
| | 2025 | 2024 | 2023 | 2025 | 2024 | 2023 |
| | £m | £m | £m | £m | £m | £m |
| Cost of sales | 61 | 38 | 55 | 9 | 155 | 185 |
| Selling, general and administration | 59 | 61 | 53 | 5 | 4 | 1 |
| Total | 120 | 99 | 108 | 14 | 159 | 186 |

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

142

Impact of climate change

The Group has stress tested the future cash flows for the potential impact of climate change and

concluded that there is sufficient headroom for goodwill. Preparation H’s recoverable amount is sensitive

to reasonably possible changes in key assumptions that would lead to an immaterial additional impairment

charge due to either physical damage in our manufacturing sites or the associated costs of future transition

risk. Carbon pricing policy is the highest potential transition risk that could have a medium risk in the

medium- to long-term time frame. With continued decarbonisation efforts and Haleon’s focus on meeting

the targets to minimise carbon pricing impacts, this is not expected to have a material impact on the key

assumptions used in the impairment assessment.

15. Inventories

Inventories are included in the Consolidated Financial Statements at the lower of cost (including raw

materials, direct labour, other direct costs and related production overheads) and net realisable value.

Cost is determined on a first in, first out basis. Net realisable value is the estimated selling price less the

estimated costs necessary to make a sale.

Composition of inventory balances


	2025	2024
	£m	£m
Raw materials and consumables	242	236
Work in progress	7	26
Finished goods	776	928
Total	1,025	1,190

The total cost of inventories recognised as an expense and included in cost of sales amounted to £3,760m

in 2025 (2024: £4,074m, 2023: £4,196m). This includes inventory write-down of £111m (2024: £177m,

2023: £178m). The Group reverses and reassesses its inventory provisions in full every reporting period.

The reversals of prior year write-downs of inventories in 2025 is £45m (2024: £90m, 2023: £74m) and these

reversals principally arise from the reassessment of usage or demand expectations prior to inventory

expiration.

Impact of climate change

The Group’s inventory turnover cycle is much shorter than the longer-term time horizons associated with

the climate-related risks and therefore the risk of material write-down of Haleon’s inventory is deemed to

be low.

16.Trade and other receivables

Trade receivables are initially measured at the original invoice amount and subsequently measured at

amortised cost less allowances for expected credit losses which are measured at an amount equal to

lifetime expected credit losses. In determining credit risk, the Group considers reasonable and supportable

information that is relevant and available without undue costs or effort. This includes both quantitative and

qualitative information and analysis based on the Group’s ageing of the receivables, customers’ payment

history and forward-looking information including wider macroeconomic factors. Trade receivables sold

under a non-recourse factoring agreement are derecognised at the point of sale as risks and rewards are

substantially transferred.

When a trade receivable is determined to have no reasonable expectation of recovery, it is written off,

firstly against any expected credit loss allowance available and then to the income statement.

Subsequent recoveries of amounts previously provided for or written off are credited to the income

statement. Long-term receivables are discounted where the effect is material.

Trade and other receivables

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | 2025 | | | 2024 | | |
| | | Non- | | | Non- | |
| | Current | current | Total | Current | current | Total |
| | £m | £m | £m | £m | £m | £m |
| Trade receivables, net of expected credit loss | | | | | | |
| allowance | 1,642 | – | 1,642 | 1,588 | – | 1,588 |
| Other prepayments and accrued income | 122 | – | 122 | 114 | – | 114 |
| Employee loans and advances | 9 | – | 9 | 6 | – | 6 |
| VAT receivable | 129 | – | 129 | 151 | – | 151 |
| Other third-party receivables | 156 | 3

7 | 193 | 196 | 71 | 26

7 |
| Total | 2,058 | 3

7 | 2,095 | 2,055 | 71 | 2,126 |

Expected credit loss allowance

| | | |
| --- | --- | --- |
| | 2025 | 2024 |
| | £m | £m |
| At 1 January | 36 | 29 |
| Exchange adjustments | – | (1) |
| Charge for the year | 43 | 38 |
| Subsequent recoveries of amounts provided for | (27) | (25) |
| Utilised | (10) | (5) |
| At 31 December | 42 | 36 |

Set out below is the information about the credit risk exposure of the Group’s trade receivables using a

provision matrix:

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

143

Year ended 31 December 2025


	Trade receivables
		Days past due
					181	Greater
		0-30	31-90	91-180	days-	than
	Current	days	days	days	1 year	1 year	Total
	£m	£m	£m	£m	£m	£m	£m
Estimated total gross carrying amount
at default	1,44 7	101	46	33	23	34	1,684
Expected credit loss	5	1	2	6	5	23	42

Year ended 31 December 2024


	Trade receivables
		Days past due
					181	Greater
		0-30	31-90	91-180	days-	than
	Current	days	days	days	1 year	1 year	Total
	£m	£m	£m	£m	£m	£m	£m
Estimated total gross carrying amount
at default	1,406	113	36	26	18	25	1,624
Expected credit loss	4	1	3	2	4	22	36

Concentrations of credit risk with respect to trade receivables are limited due to the Group’s customer base

being large and diverse. No single customer represents more than 10% of the Group’s sales.

Within other third-party receivables, £159m (2024: £189m) was classified as financial assets. The expected

credit loss in other receivables is not deemed significant, hence no credit loss allowance is recognised.

Refer to Note 25 ‘Capital and financial risk management’ for further information on credit risk.

17. Cash and cash equivalents

Cash and cash equivalents is comprised of cash at bank and short-term highly liquid deposits which are

primarily held for operating purposes and normally with an original maturity of three months or less, that

are readily convertible to a known amount of cash and subject to an insignificant risk of changes.

Cash and cash equivalents include £64m in 2025 (2024: £55m) not available for general use due to

restrictions applying in the subsidiaries where it is held. Restrictions include exchange controls and taxes

on repatriation. In 2025, £424m (2024: £1,226m) of the cash and cash equivalents are held in short term

deposits with financial institutions.

Cash and cash equivalents held in the following currencies, that mostly influence the Group, are presented

below:


	2025	2024
	£m	£m
Pound Sterling (GBP)	914	1,790
Indian Rupee (INR)	49	73
Taiwan Dollar (TWD)	30	40
Euro (EUR)	29	30
United States Dollar (USD)	28	27
Others	274	290
Total	1,324	2,250

18.Trade and other payables

Trade payables are initially recognised at fair value and then held at amortised cost. Long-term payables

are discounted where the effect is material. Trade payables are derecognised when the original liability is

either discharged, usually through payment, or substantially modified.

Composition of trade and other payables

| | | |
| --- | --- | --- |
| | 2025 | 2024 |
| | £m | £m |
| Trade payables | 2,058 | 1,973 |
| Customer return and rebate accruals | 755 | 738 |
| Other payables and accruals | 41

7 | 477 |
| Wages and salaries | 280 | 290 |
| Accrued interest on financial liabilities | 91 | 104 |
| Social security | 50 | 54 |
| VAT payables | 45 | 51 |
| Deferred income | 34 | 18 |
| Total | 3,730 | 3,705 |

Customer return and rebate accruals are provided for by the Group at the point of sale in respect of the

estimated rebates, discounts or allowances payable to customers. Accruals are made at the time of sale

but the actual amounts paid are based on claims made some time after the initial recognition of the sale.

The level of accrual is reviewed and adjusted quarterly in light of historical experience of actual rebates,

discounts or allowances given and returns made and any changes in arrangements. The assumptions used

in estimation are based on known facts with a high level of accuracy. In addition, the Group’s promotional

programmes are typically short term in nature resulting in lower inherent estimation uncertainty. As a result,

management considered no likelihood of material change in the next financial year.

Customer return and rebate accruals are not presented net against any trade receivables that may be

owing from the same customer as the offsetting criteria in IAS 32 have not been met.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

144

Supply chain financing arrangements

The Group has supply chain financing (SCF) arrangements in place. The principal purpose of these

arrangements is to enable the supplier, if it so wishes, to sell its receivables due from the Group to a

third-party bank prior to their due date, thus providing earlier access to liquidity. From the Group’s

perspective, the invoice payment due date remains unaltered and the payment terms of suppliers

participating in the SCF programmes are similar to those suppliers that are not participating, and to the

wider industry more generally.

If a receivable is purchased by a third-party financial institution, that financial institution does not benefit

from additional security when compared to the security originally enjoyed by the supplier.

These amounts are included within trade payables and all cash flows associated with the programmes are

included within cash flow from operating activities as they continue to be part of the normal operating

cycle of the Group.


Carrying amount of liabilities (£m)	2025	2024
Presented within trade and other payables	11	15
of which suppliers have received payments	6	8
Range of payment due dates
Liabilities that are part of the arrangements	60-125	60-125
Comparable trade payables that are not part of the arrangement	30-125	30-125

19. Borrowings

All borrowings are initially recorded at fair value, net of transaction costs. Borrowings are subsequently

carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the

amount due on redemption being recognised as a charge to the income statement over the period of the

relevant borrowing.

Lease liabilities

The corresponding liability to the lessor is recognised as a lease obligation within short term and long-term

borrowings. The carrying amount is subsequently increased to reflect interest on the lease liability and

reduced by lease payments made.

For calculating the discounted lease liability on leases, the implicit rate in the lease is used. If this is not

available, the incremental borrowing rate with a lease-specific adjustment is used. Finance costs are

charged to the income statement to produce a constant periodic rate of charge on the remaining balance

of the obligations for each accounting period.

Variable rents are not part of the lease liability and the right of use asset. These payments are charged to

the income statement as incurred. Short term and low-value leases are not capitalised, and lease rentals

are also charged to the income statement as incurred.

Composition of borrowings

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | 2025 | | | 2024 | | |
| | | Non- | | | Non- | |
| | Current | current | Total | Current | current | Total |
| | £m | £m | £m | £m | £m | £m |
| Loan and overdrafts | (43) | (300) | (343) | (43) | (290) | (333) |
| Advances

1 | (6) | – | (6) | – | – | – |
| Lease liabilities | (48) | (85) | (133) | (50) | (73) | (123) |
| Non-voting preference shares | – | (25) | (25) | – | (25) | (25) |
| Bonds | (739) | (7,363) | (8,102) | (1,394) | (8,252) | (9,646) |
| Total | (836) | (7,773) | (8,609) | (1,487) | (8,640) | (10,127) |

Advances include partial amount of sale consideration received from sale of site.


	Carrying value
	2025	2024
Bonds 1	£m	£m
USD 1,750m 3.125% Mar 2025	–	1,394
EUR 850m 1.250% Mar 2026	739	694
USD 2,000m 3.375% Mar 2027	1,484	1,587
EUR 750m 2.875% Sep 2028	648	620
GBP 300m 2.875% Oct 2028	300	299
USD 1,000m 3.375% Mar 2029	739	785
EUR 750m 1.750% Mar 2030	654	620
USD 2,000m 3.625% Mar 2032	1,470	1,558
GBP 300m 4.625% Sep 2033	299	298
EUR 750m 2.125% Mar 2034	650	617
GBP 400m 3.375% Mar 2038	399	398
USD 1,000m 4.000% Mar 2052	720	776
Total	8,102	9,646

These instruments contain a variety of different features including early redemption options, call options, put options and

mandatory early redemption options, which depend on different triggering events such as change in control, change in

laws, regulations and tax law. These features are considered embedded derivatives. These features have not been

accounted for separately from the instruments as they are considered closely related to the bonds.

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

145

Short-term borrowings

As at 31 December 2025, the Group had within short-term borrowings, EUR Medium Term Note of €850m

(£739m) (31 December 2024: $1,750m (£1,394m)). The average effective pre-swap and post-swap interest

rate of all short-term notes in issue as at 31 December 2025 was 1.3% and 3.6% (31 December 2024: 3.1%

and 4.6%). The Group repaid the $1,750m Fixed Rate Senior Note on its maturity on 24 March 2025.

The Group has commercial paper programmes (with maximum aggregate amounts of £2bn and $10bn)

pursuant to which members of the Group may issue commercial paper from time to time. At 31 December

2025 and 2024 the Group did not have any commercial paper in issue.

As at 31 December 2025, the Group had CNY 201m (£22m) short-term bank loans (31 December 2024: £nil).

The weighted average interest rate on short-term bank loans as at 31 December 2025 was 2.9%

(31 December 2024: 0%).

Long-term borrowings

As at 31 December 2025, the Group had within long-term borrowings, Notes of £7,363m (31 December

2024: £8,252m), of which £3,538m (31 December 2024: £4,267m) fell due in more than five years. The

average effective pre-swap and post-swap interest rate of all long-term notes in issue as at 31 December

2025 was 3.2% and 3.0% (31 December 2024: 3.1% and 3.2%).

On 27 June 2025, the Group secured a long-term bank loan of CNY 373m (£39m) maturing on 26 June 2030.

The weighted average interest rate on the long-term bank loans of CNY 2,824m (£300m) (31 December

2024: CNY 2,679m (£290m)) as at 31 December 2025 was 2.9% (31 December 2024: 3.0%).

On 17 July 2022, as part of the demerger activities, the Company issued 25,000,000 non-voting preference

shares of £1.00 each to Pfizer Inc. with a coupon rate of 9.5% per annum. The non-voting preference shares

(NVPS) command a mandatory quarterly coupon and can only be redeemed after a period of five years.

The Group has, therefore, classified the non-voting preference shares as a financial liability. Pfizer Inc. has

subsequently disposed of the NVPS to an external third party.

Committed credit facilities

The Group has an undrawn credit facilities of £1,750m with initial maturity date of August 2028. As at

31 December 2025, no amounts were drawn under these facilities (31 December 2024: £nil).

Lease liabilities

The maturity analysis of lease liabilities recognised on the Group balance sheet is as follows:



	2025	2024
	£m	£m
Due within one year	(48)	(50)
Due between one and two years	(43)	(36)
Due between two and three years	(12)	(19)
Due between three and four years	(7)	(9)
Due between four and five years	(4)	(6)
Due after five years	(19)	(3)
Total	(133)	(123)

Refer to Note 8 ‘Net finance costs’ for further details on finance expense arising on lease liabilities.

Movement in assets and liabilities arising from financing activities

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | |
| | | | | Fair value | |
| | | | | adjustments, | |
| | At | | | interest on | At |
| | 1 January | | Foreign | derivatives and | 31 December |
| | 2025 | Cash flows | exchange | reclassification | 2025 |
| | £m | £m | £m | £m | £m |
| Reconciliation of movement in liabilities | | | | | |
| to cash flow statement | | | | | |
| Long-term borrowings | (8,567) | (40) | 226 | 693 | (7,688) |
| Short-term borrowings | (1,394) | 1,346 | 6 | (725) | (767) |
| Lease liabilities | (123) | 60 | 2 | (72) | (133) |
| Derivative financial instruments | (30) | (31) | 2 | 81 | 22 |
| Total financial liabilities arising from | | | | | |
| financing activities | (10,114) | 1,335 | 236 | (23) | (8,566) |
| Cash and cash equivalents net of bank overdrafts | 2,20

7 | (855) | (49) | – | 1,303 |
| Total | (7,907) | 480 | 18

7 | (23) | (7,263) |



				Fair value
				adjustments,
	At 1			interest on	At
	January		Foreign	derivatives and	31 December
	2024	Cash flows	exchange	reclassification	2024
	£m	£m	£m	£m	£m
Reconciliation of movement in liabilities
to cash flow statement
Long-term borrowings	(8,711)	(1,214)	16	1,342	(8,567)
Short-term borrowings	(558)	562	(27)	(1,371)	(1,394)
Lease liabilities	(137)	60	3	(49)	(123)
Derivative financial instruments	(102)	8	(1)	65	(30)
Total financial liabilities arising from
financing activities	(9,508)	(584)	(9)	(13)	(10,114)
Cash and cash equivalents net of bank overdrafts	994	1,292	(79)	–	2,207
Total	(8,514)	708	(88)	(13)	(7,907)

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

146

20. Pensions and other post-employment benefits

The Group operates pension arrangements which cover the Group’s material obligations to provide

pensions to retired employees. These arrangements have been developed in accordance with local

practices in the countries concerned. Pension benefits can be provided by state schemes, by defined

contribution schemes, whereby retirement benefits are determined by the value of funds arising from

contributions paid in respect of each employee, or by defined benefit schemes, whereby retirement

benefits are based on employee pensionable remuneration and length of service. In certain countries,

pension benefits are provided on an unfunded basis, some are administered by trustee companies. The

Group also provides other post-employment benefits, mainly post-employment healthcare plans in the US.

These plans are predominantly unfunded. Formal, independent, actuNew Hero Access Light valuations of

the Group’s main plans are undertaken regularly, normally at least every three years.

For defined benefit retirement plans, the difference between the fair value of the plan assets and the

present value of the plan liabilities is recognised as an asset or a liability on the consolidated balance

sheet. Defined benefit plan liabilities are assessed using the projected unit funding method and applying

the principal actuNew Hero Access Light assumptions at the reporting period date consistent with the

advice of qualified actuaries. Pension scheme assets are measured at fair value at the balance sheet date.

The amount of any pension fund asset recognised on the balance sheet is limited to any future refunds

from the plan or the present value of reductions in future contributions to the plan.

The amount charged to operating costs in the income statement is the cost of accruing pension benefits

promised to employees over the year, plus the costs of individual events such as past service benefit

changes, settlements, curtailments plus the finance charge for interest on net liability (such events are

recognised immediately in the income statement).

Remeasurements of the net defined benefit liability (or asset) comprise actuNew Hero Access Light gains

and losses and the return on plan assets excluding amounts included in net interest. ActuNew Hero Access

Light gains and losses are taken to the consolidated statement of comprehensive income. ActuNew Hero

Access Light gains and losses comprise both the effects of changes in actuNew Hero Access Light

assumptions and experience adjustments arising from differences between the previous actuNew Hero

Access Light assumptions and what has actually occurred. The return on plan assets, in excess of interest

income, and costs incurred for the management of plan assets are also taken to other comprehensive

income.

The costs of other post-employment liabilities are calculated in a similar way to defined benefit pension

schemes and spread over the period during which benefit is expected to be derived from the employees’

services. Future cash flows are discounted at rates reflecting the yields of high-quality corporate bonds.

The Group’s contributions to defined contribution plans are charged to the income statement as incurred.

Discount rates are derived from AA-rated corporate bond yields, except in countries where there is no

deep market in corporate bonds, government bond yields are used instead. Discount rates are selected to

reflect the term of the expected benefit payments. Projected inflation rate and pension increases are long-

term predictions based on the yield gap between long-term index-linked and fixed-interest government

bonds, where available, or on long-term inflation forecasts.

Assumptions

The Group has applied the following financial assumptions in assessing the defined benefit liabilities:



	2025	2024
	%pa	%pa
Germany
Rate of increase of future earnings	3.0	3.0
Discount rate	4.1	3.4
Expected pension increases	2.0	2.0
Inflation rate	2.0	2.0
Switzerland
Rate of increase of future earnings	1.8	1.8
Discount rate	1.3	1.0
Expected pension increases	N/ A	N/A
Inflation rate	1.0	1.0
Ireland
Rate of increase of future earnings	2.0	2.0
Discount rate	4.3	3.4
Expected pension increases	3.0	3.0
Inflation rate	2.0	2.0
Rest of World
Rate of increase of future earnings	N/ A	N/A
Discount rate	5.5	5.7
Expected pension increases	N/ A	N/A
Inflation rate	2.5	2.5

The average life expectancy assumed now for an individual at the age of 60 and projected to apply in the

years stated below for an individual then at the age of 60 is as follows:

As at 31 December 2025



	Germany		Switzerland		Ireland		Rest of World
Years	Male	Female	Male	Female	Male	Female	Male	Female
Current	25.6	29.3	26.8	28. 7	27.5	30.4	27.5	28.8
Projected for 2045	28.4	31.5	28.6	30.4	30.2	32.6	29.0	30.3

As at 31 December 2024



	Germany		Switzerland		Ireland		Rest of World
Years	Male	Female	Male	Female	Male	Female	Male	Female
Current	25.5	29.2	26. 7	28.6	27.3	30.3	27.4	28.8
Projected for 2044	28.5	31.5	28.6	30.3	30.1	32.4	28.9	30.2

The mortality rates are based on standard tables in each country (Heubeck 2018 in Germany, BVG 2020 in

Switzerland and ILT15 in Ireland) with allowances for future improvements.

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

147

Income statement


	2025	2024	2023
	£m	£m	£m
German pension schemes	3	3	5
Swiss pension schemes	9	10	9
Irish pension schemes	3	5	2
Other overseas pension schemes	2	2	–
Unfunded post-employment healthcare schemes	8	9	10
Total	25	29	26

The costs of the defined benefit pension and post-employment healthcare schemes are charged in the

income statement as follows:

| | | | |
| --- | --- | --- | --- |
| | | Other post | |
| | | retirement | Total post |
| | Net pensions | obligations | retirement |
| | total | total | obligations |
| | £m | £m | £m |
| 2025 | | | |
| Cost of sales | 10 | 8 | 18 |
| Research and development | 2 | – | 2 |
| Selling, general and administration | 5 | – | 5 |
| 31 December 2025 | 1

7 | 8 | 25 |
| 2024 | | | |
| Cost of sales | 10 | 9 | 19 |
| Research and development | 2 | – | 2 |
| Selling, general and administration | 8 | – | 8 |
| 31 December 2024 | 20 | 9 | 29 |
| 2023 | | | |
| Cost of sales | 10 | 8 | 18 |
| Research and development | 1 | – | 1 |
| Selling, general and administration | 7 | – | 7 |
| 31 December 2023 | 18 | 8 | 26 |

The amounts recorded in the income statement and statement of comprehensive income in relation to the

defined benefit pension and post-employment healthcare schemes were as follows:


	2025			2024			2023
		Other			Other			Other
		post-			post-			post-
		employment			employment			employment
	Pensions	benefits	Total	Pensions	benefits	Total	Pensions	benefits	Total
	£m	£m	£m	£m	£m	£m	£m	£m	£m
31 December
Amounts charged to
operating profit:
Current service cost	16	4	20	17	5	22	16	6	22
Past service cost/(credit)	1	–	1	4	–	4	1	–	1
Gain from settlement	–	–	–	(1)	–	(1)	–	–	–
Net interest cost	–	4	4	–	4	4	1	2	3
Total	1 7	8	25	20	9	29	18	8	26
Remeasurements
recorded in the statement
of comprehensive income	(40)	2	(38)	(6)	(13)	(19)	(6)	1	(5)

Balance sheet

The assets of funded schemes are generally held in separately administered trusts, either as specific assets

or as a proportion of a general fund or are insurance contracts. Assets are invested in different classes in

order to maintain a balance between risk and return. Investments are diversified to limit the financial effect

of the failure of any individual investment.

The pension plans are exposed to risk that arises because the estimated market value of the plans’ assets

might decline, the investment returns might reduce, or the estimated value of the plans’ liabilities might

increase.

Long-term investment strategies for the plans, with investments across a broad range of assets, have been

agreed with the trustees to include return-seeking assets to generate future returns and liability-matching

assets to better match future pension obligations. The main market risks within the asset portfolio are

credit risk, interest rates, long-term inflation, equities and property risk.

The plan liabilities are a series of future cash flows with relatively long duration. On an IAS 19 basis, these

cash flows are sensitive to changes in the expected long-term inflation rate and the discount rate (AA

corporate bond yield curve) where an increase in long-term inflation corresponds with an increase in the

liabilities, and an increase in the discount rate corresponds with a decrease in the liabilities.

In 2025 the Group recognised a gain relating to lowering the asset ceiling restriction in Switzerland. This

was the result of a change in methodology for the interest credit rate assumption applied which is now

linked to the expected rate of return on the plan assets (in line with market practice), whereas in the past

it was equal to the discount rate used.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

148

A pension surplus is deemed recoverable to the extent that the Group is able to benefit economically from

the surplus. Haleon assesses the maximum economic benefit available through either a refund of surplus

or a reduction in future contributions in accordance with local legislation and the minimum funding

requirements for each of our funded defined benefit plans.

The fair values of the assets and liabilities of the German, Swiss and Irish defined benefit pension schemes,

together with aggregated data for other defined benefit pension schemes in the Group are as follows:

31 December 2025


				Rest of
	Germany	Switzerland	Ireland	World	Total
	£m	£m	£m	£m	£m
Listed equities	62	81	34	3	180
Property	–	70	–	–	70
Listed bonds	63	10 7	150	5	325
Insurance contracts	24	44	–	–	68
Other assets	–	43	3	12	58
Fair value of assets	149	345	18 7	20	701
Asset ceiling restriction	–	(2)	–	–	(2)
Fair value of assets after asset ceiling	149	343	18 7	20	699
Present value of scheme obligations	(165)	(318)	(151)	(31)	(665)
Recognised on the balance sheet	(16)	25	36	(11)	34
Included in post-employment benefit assets	–	25	36	7	68
Included in post-employment benefit obligations	(16)	–	–	(18)	(34)
Total	(16)	25	36	(11)	34
Actual return on plan assets	6	20	(19)	2	9

31 December 2024


				Rest of
	Germany	Switzerland	Ireland	World	Total
	£m	£m	£m	£m	£m
Listed equities	56	74	32	4	166
Property	–	68	–	–	68
Listed bonds	57	88	162	19	326
Insurance contracts	24	45	–	–	69
Other assets	–	34	2	13	49
Fair value of assets	13 7	309	196	36	678
Asset ceiling restriction	–	(18)	–	–	(18)
Fair value of assets after asset ceiling	13 7	291	196	36	660
Present value of scheme obligations	(170)	(291)	(169)	(45)	(675)
Recognised on the balance sheet	(33)	–	2 7	(9)	(15)
Included in post-employment benefit assets	–	–	27	9	36
Included in post-employment benefit obligations	(33)	–	–	(18)	(51)
Total	(33)	–	2 7	(9)	(15)
Actual return on plan assets	11	13	1	3	28

The values of pension plan assets are based on conditions in active markets as at 31 December 2025.

In the case of the main defined benefit plans, this statement covers investment in equities, property funds

and government bonds as well as corporate bonds. The fair value of insurance contracts is deemed to be

equal to the present value of the obligations it covers while other assets is primarily cash.

The defined benefit pension obligation is analysed as follows:


	2025	2024
	£m	£m
Funded	(651)	(662)
Unfunded	(14)	(13)
Total	(665)	(675)

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

149

The movement in the net defined benefit liability is as follows:


		Present	Net	Net post-
	Fair value	value of	pensions	employment
	of assets	obligation	total	obligations
	£m	£m	£m	£m
At 1 January 2024	661	(697)	(36)	(85)
Exchange adjustments	(28)	34	6	(2)
Service cost	–	(17)	(17)	(5)
Past service cost	–	(4)	(4)	–
Interest income/(cost)	17	(17)	–	(4)
Settlements and curtailments	–	1	1	–
Remeasurements:
Return on plan assets, excluding amounts included in
interest	12	–	12	–
Loss arising from changes in demographic assumptions	–	(3)	(3)	–
(Loss)/Gain from change in financial assumptions	–	(1)	(1)	11
Experience (losses)/gains	–	(2)	(2)	2
Employers' contributions	29	–	29	–
Scheme participants' contributions	7	(7)	–	–
Benefits paid	(38)	38	–	3
At 31 December 2024	660	(675)	(15)	(80)
Exchange adjustments	33	(35)	(2)	5
Service cost	–	(16)	(16)	(4)
Past service cost	–	(1)	(1)	–
Interest income/(cost)	16	(16)	–	(4)
Settlements and curtailments	(14)	14	–	–
Remeasurements:
Return on plan assets, excluding amounts included in
interest	(8)	–	(8)	–
Loss arising from changes in demographic assumptions	–	–	–	–
Gain/(Loss) from change in financial assumptions	–	39	39	(1)
Changes in asset ceiling restriction	16	–	16	–
Experience (losses)/gains	–	(7)	(7)	(1)
Employers' contributions	28	–	28	–
Scheme participants' contributions	7	(7)	–	–
Benefits paid	(39)	39	–	5
At 31 December 2025	699	(665)	34	(80)

A reconciliation of the net post-employment benefit to the balances recognised on the consolidated

balance sheet is as follows:


	2025	2024
	£m	£m
Net pension obligations	34	(15)
Net post-employment obligations	(80)	(80)
Net post-employment benefit	(46)	(95)
Post-employment benefit assets recognised on the consolidated balance sheet	68	36
Post-employment benefit obligations recognised on the consolidated balance
sheet	(114)	(131)
Net post-employment benefit	(46)	(95)

The Group’s investment strategy in respect of its funded plans is implemented within the framework of

the various statutory requirements of the territories where the plans are based. For the plans based in

Switzerland, the Group’s annual contribution is at least equal to the total annual contributions of the

employees. In Ireland, funding is determined based on the triennial funding valuation performed by

actuaries carried out using prudent assumptions and the most recent review in 2024 showed that the plan

is overfunded. The US post-employment medical benefit plan remains unfunded.

Employer contributions for 2026 are estimated to be approximately £22m in respect of defined benefit

pension schemes and £3m in respect of post-employment medical benefits.

The defined benefit pension and post-employment obligations analysed by membership category is

as follows:


			Post-employment
	Pension		obligations
	2025	2024	2025	2024
	£m	£m	£m	£m
Active	(364)	(347)	(65)	(70)
Retired	(209)	(224)	(15)	(10)
Deferred	(92)	(104)	–	–
Total	(665)	(675)	(80)	(80)

The approximate effect of changes in assumptions used on the benefit obligations and on the annual

defined benefit and post-employment costs are detailed below. This information has been determined by

taking into account the duration of the liabilities and the overall profile of the plan membership.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

150

Sensitivity analysis



	2025	2024
	£m	£m
0.50% decrease in discount rate:
Increase in annual pension cost	2.6	2.3
Increase in annual post-employment benefits cost	0.2	0.2
Increase in pension obligation	42.8	45.7
Increase in post-employment benefits obligation	3.2	3.1
0.50% increase in discount rate:
Decrease in annual pension cost	(2.8)	(2.4)
Decrease in annual post-employment benefits cost	(0.1)	(0.1)
Decrease in pension obligation	(39.0)	(41.2)
Decrease in post-employment benefits obligation	(2.9)	(2.8)
1% increase in the rate of future healthcare inflation:
Increase in annual post-employment cost	0.1	0.2
Increase in post-employment obligation	1.4	1.6
1% decrease in the rate of future healthcare inflation:
Decrease in annual post-employment cost	(0.2)	(0.2)
Decrease in post-employment obligation	(1.7)	(1.8)
A one year increase in life expectancy:
Increase in annual pension cost	0.8	0.7
Increase in annual post-employment benefits cost	0.1	0.1
Increase in pension obligation	16.6	17.6
Increase in post-employment benefits obligation	0.8	0.7

The above analysis covers major defined benefit obligations, i.e. in Germany, Switzerland, Ireland and the

US, which together represent over 90% of the Group’s plan assets and the obligations.

The weighted average duration of the defined benefit obligation is as follows:



Years	2025	2024
Pension benefits	13	14
Post-employment benefits	12	12

21. Provisions

Provisions are recognised where a legal or constructive obligation exists at the balance sheet date, as a

result of a past event, where the amount of the obligation can be reliably estimated and where the outflow

of economic benefit is probable.

Provisions are measured at management’s best estimate of the most likely outcome of the expenditure

required to settle the obligation at the reporting date and are discounted to present value where the effect

is material. Provisions are classified as non-current where the exact timing of settlement is uncertain but

they are expected to be settled in more than 12 months.

Provisions



	Restructuring	Other
	programmes	provisions	Total
	£m	£m	£m
As at 1 January 2024	(94)	(75)	(169)
Exchange adjustments	2	1	3
Charge for the period	(95)	(38)	(133)
Reversed unused	7	8	15
Utilised	76	33	109
As at 31 December 2024	(104)	(71)	(175)
Exchange adjustments	(1)	(1)	(2)
Charge for the period	(27)	(24)	(51)
Reversed unused	12	4	16
Utilised	71	32	103
As at 31 December 2025	(49)	(60)	(109)


	2025	2024
	£m	£m
To be settled within one year	(69)	(118)
To be settled after one year	(40)	(57)
Total provisions	(109)	(175)

Other provisions include employee-related, legal, environmental, and other provisions. Refer to Note 6,

‘Operating profit’ for further details about the Group’s restructuring costs.

22.Contingent liabilities and commitments

Contingent liabilities

Contingent liabilities are potential future outflows where the likelihood of payment is considered more

than remote, but is not considered probable or cannot be measured reliably. No provision is made for

contingent liabilities, but there is a chance that they will result in an obligation in the future.

At 31 December 2025, contingent liabilities, comprising guarantees and other items arising in the normal

course of business, amounted to £9m (2024: £16m).

The Group is involved in significant legal and administrative proceedings, principally relating to product

liabilities. The most significant of these matters, other than tax matters, are described herein. Provision is

made for the outcome of tax, legal and other disputes where it is both probable that the Group will suffer

an outflow of funds and it is possible to make a reliable estimate of that outflow.

Legal proceedings

The Group may become involved in legal proceedings, in respect of which it is not possible to determine

whether a potential outflow is probable, or to make a reliable estimate of the expected financial effect,

if any, that could result from the proceedings. In these cases, appropriate disclosure about such cases

would be included but no provision would be made. Costs associated with claims made by the Group

against third parties are charged to the income statement as they are incurred.

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Annual Report and Form 20-F 2025

151

The Group makes provision for these proceedings on a regular basis as summarised in the accounting

policy above.

With respect to each of the legal proceedings described below, other than those for which a provision has

been made, the Group is unable to make a reliable estimate of the expected financial effect at this stage.

The Group does not believe that information about the amount sought by the plaintiffs, if that is known,

would be meaningful with respect to those legal proceedings. This is due to a number of factors, including,

but not limited to, the stage of proceedings, the entitlement of parties to appeal a decision and clarity as

to theories of liability, damages and governing law.

The Group’s position could change over time and therefore, there can be no assurance that any losses that

result from the outcome of any legal proceedings will not exceed by a material amount the value of the

provisions reported in the Group’s financial statements. If this were to happen, it could have a material

adverse impact on the results of operations of the Group in the reporting period in which the judgements

are incurred or the settlements entered into.

Zantac litigation

GSK and/or Pfizer have been named as defendants (alongside other manufacturers of ranitidine, as well as

retailers and distributors) in personal injury lawsuits, as well as economic injury and medical monitoring

class actions, filed in the US involving Zantac. The Group understands that outside the US, there are class

actions and individual actions pending against GSK and Pfizer in Canada, along with a class action against

GSK in Israel.

GSK has announced that it has resolved all but 13 state court cases; the remaining federal MDL cases were

dismissed in December 2022 and are currently on appeal. As previously disclosed, Pfizer also announced

that it has entered into settlement arrangements in respect of a substantial majority of relevant US state

court cases.

The Group is not a party to any Zantac claims and the Group has never marketed Zantac in any form in the

US or Canada. The Group is not primarily liable for any OTC or prescription Zantac claims.

The Group has received notices of potential claims for indemnification relating to OTC Zantac arising out of

the Stock and Asset Purchase Agreement (SAPA), which the Group has rejected on the basis that the scope

of the indemnities set out in the SAPA only covers the Consumer Healthcare businesses of GSK and Pfizer

as conducted when their Consumer Healthcare joint venture was formed in 2018. At that time, neither GSK

nor Pfizer marketed OTC Zantac in the US or Canada.

German competition litigation

In 2013, GlaxoSmithKline Consumer Healthcare GmbH & Co. KG and other members of a working group

of a German trademark association were fined by the Federal Cartel Office of Germany as a result of the

exchange of certain information related to retailers during meetings from 2004 to 2006.

Following the fine imposed by the Federal Cartel Office in 2013, the Group is party to civil proceedings

in Germany brought by or on behalf of retailers against the Group and other manufacturers of branded

drugstore products, alleging that the exchange of information within the working group led to higher

purchase prices being paid by the retailers, and claiming that the Group and other working group members

are jointly and severally liable for potential damages. The proceedings are taking place in different courts

across Germany and are at different stages.

Commitments

Commitments are contractual obligations to acquire certain classes of assets in the future. These amounts

are not recorded in the Consolidated Financial Statements.


	2025	2024
	£m	£m
Contracted for but not provided in the Consolidated Financial Statements:
Intangible assets	69	105
Property, plant and equipment	162	51
Total	231	156

23.Share capital, share premium and other reserves

Share capital represents the par value of shares that have been issued.

Share premium includes any premiums received on the issue of share capital. Any transaction costs

associated with the issuing of shares are deducted from share premium, net of any related income

tax benefits.

Other reserves include the following:

EBT shares reserve comprise shares held by an employee benefit trust in connection with the Group’s

share-based incentive plans.

Cash flow hedge reserve comprises gains and losses relating to these types of financial instruments.

Merger reserve arises as a result of business combinations of entities under common control.

Other reserves comprises mainly differences between the fair value of the consideration paid for an

investment, and the carrying value of assets and liabilities acquired from business combinations under

common control.

Translation reserve arises from the foreign currency translation of the Group’s foreign operations into the

Group’s presentation currency.

Retained earnings includes all current and prior years’ retained profits, remeasurement gains/(losses),

including any tax impacts on defined benefit plans.

As at 31 December 2025, the Group had share capital of £90m pertaining to 8,952,353,648 of ordinary

shares at £0.01 each (31 December 2024: £91m pertaining to 9,083,725,919 of ordinary shares at £0.01

each). The decrease in the number of shares outstanding was due to a number of transactions during the

year including a cancellation of 44,155,844 ordinary shares repurchased from Pfizer pursuant to an off

market share buyback which completed on 21 March 2025 for approximately £170m. On 28 March 2025,

the Group announced the commencement of an on-market share buyback programme. The first tranche of

the buyback programme commenced on 28 March 2025 for aggregate consideration of approximately

£200m and concluded on 26 June 2025 with the Group re-purchasing 51,036,522 which were

subsequently cancelled.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

152

On 31 July 2025, the Group announced the commencement of the second tranche of the buyback

programme for an aggregate consideration of approximately £280m. This was made up of approximately

£130m to complete the remainder of the £500m allocated to share buybacks in 2025 and a further

approximately £150m for the purposes of satisfying Haleon's obligations under its existing employee share

plans in 2026 and 2027. The second tranche of the buyback programme concluded on 1 October 2025 with

Haleon re-purchasing 80,614,159 shares, 36,179,905 of which were subsequently cancelled and 44,434,254

were held as treasury shares.

As at 31 December 2025 the Company held 45,745,646 ordinary shares as treasury shares (2024:

30,365,037 ordinary shares).

Share capital and share premium


		At	At
		31 December	31 December
		2025	2024
Ordinary shares at £0.01 each	Number	8,952,353,648	9,083,725,919
Share capital	£’000	89,524	90,83 7

The table above presents the movement of share capital and share premium of the Company for the year

ended 31 December 2025. All ordinary shares are issued and fully paid. All ordinary shares rank equally

with regard to the Company’s residual assets. Holders of these shares are entitled to dividends declared

from time to time and are entitled to one vote per share at general meetings of the Company. All rights

attached to the treasury shares held by the Group are suspended until those shares are reissued. The

redeemable preference shares carry limited class voting rights and no dividend rights.

Other reserves

The analysis of other reserves is as follows:


						Cash
	Cumulative		Treasury	Fair	Capital	flow
	translation	EBT shares	shares	Value	redemption	hedge	Merger
	reserve	reserve 1	reserve	reserve	reserve	reserve	reserve	Total
	£m	£m	£m	£m	£m	£m	£m	£m
As at 1 January 2024	626	(38)	–	–	–	139	(11,687)	(10,960)
Other comprehensive income	–	–	–	–	–	(26)	–	(26)
Shares transferred to
employees	–	41	–	–	–	–	–	41
Repurchase of ordinary shares
and capital reduction	–	–	–	–	1	–	–	1
Purchase of shares by
employee benefit trust	–	(5)	–	–	–	–	–	(5)
Purchase of treasury shares	–	–	(116)	–	–	–	–	(116)
Exchange movements on
overseas net assets	(132)	–	–	–	–	–	–	(132)
As at 31 December 2024	494	(2)	(116)	–	1	113	(11,687)	(11,197)


						Cash
	Cumulative		Treasury	Fair	Capital	flow
	translation	EBT shares	shares	Value	redemption	hedge	Merger
	reserve	reserve 1	reserve	reserve	reserve	reserve	reserve	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Other comprehensive income	–	–	–	(15)	–	(12)	–	(27)
Shares transferred to
employees	–	10 7	1	–	–	–	–	108
Repurchase of ordinary shares
and capital reduction	–	–	–	–	1	–	–	1
Transfer of treasury shares to
employee benefit trust	–	(110)	110	–	–	–	–	–
Purchase of treasury shares	–	–	(151)	–	–	–	–	(151)
Exchange movements on
overseas net assets	(246)	–	–	–	–	–	–	(246)
As at 31 December 2025	248	(5)	(156)	(15)	2	101	(11,687)	(11,512)

Shares owned through an EBT. The total number of shares held in connection with employee share schemes as at 31

December 2025 was 1.3m (2024:0.6m).

The cumulative translation exchange in equity is attributable to:


			Total
		Non-	cumulative
	Retained	controlling	translation
	earnings	interests	exchange
	£m	£m	£m
As at 1 January 2024	626	(1)	625
Exchange movements on overseas net assets	(132)	(2)	(134)
As at 31 December 2024	494	(3)	491
Exchange movements on overseas net assets	(246)	(1)	(247)
As at 31 December 2025	248	(4)	244

24. Related party transactions

A related party under IFRS is a person or entity that is related to the Group. These include both people

and entities that have, or are subject to, influence or control over the Group.

Related parties

Upon the completion of the demerger on 18 July 2022, GSK ceased to be a related party of the Group

under IAS 24, ‘Related Party Disclosures’.

In 2024, Pfizer Inc. undertook a number of transactions during the year which reduced Pfizer's voting

rights to 15%. Following this, Pfizer ceased to be a related party of the Group under IAS 24, 'Related Party

Disclosures' and therefore only balances that occurred before 3 October 2024 are disclosed below.

In 2025, there were no new related party transactions that have or could have materially affected the

financial position or performance of the Group for the period ended 31 December 2025.

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Annual Report and Form 20-F 2025

153

The Group undertook significant transactions with entities from within GSK during the period ended

18 July 2022, and with entities from within Pfizer for the year ended 31 December 2022. Any amounts

owed from GSK as at 31 December 2024 in relation to arrangements set up with GSK before the demerger

activities when GSK was still a related party of the Group, have been settled during the period ended

31 December 2025.

In previous years, the Group had transactions with related parties under manufacture and supply

agreements, distribution agreements, support service agreements, provision of research and development,

toll-manufacturing services and transitional services agreements. In addition, the Group earned net interest

income resulting from funds lent to GSK. All related party transactions are undertaken at arm’s length in

accordance with the Group transfer pricing policy.

Where the legal completion of local transfer of assets and liabilities has been delayed, but the Group

is able to exercise control over the relevant activities, the relevant net assets and profits have been

recognised in the results.

Transaction values for the year ended 31 December (unless otherwise indicated):

| | | | |
| --- | --- | --- | --- |
| | Pfizer companies | | |
| | 2025 | 2024 | 2023 |
| | £m | £m | £m |
| Dividend paid | – | 165 | 124 |

Balance outstanding as at 31 December:


	Pfizer companies		GSK companies
	2025	2024	2025	2024
	£m	£m	£m	£m
Other amounts owing from related parties	–	–	–	34

25. Capital and financial risk management

Financial assets are measured at amortised cost, fair value through other comprehensive income (FVTOCI)

or fair value through profit or loss (FVTPL). The measurement basis is determined by reference to both the

business model for managing the financial asset and the contractual cash flow characteristics of the

financial asset. For financial assets other than trade receivables, a 12-month expected credit loss allowance

is recorded on initial recognition. If there is subsequent evidence of a significant increase in the credit risk

of an asset, the allowance is increased to reflect the lifetime expected credit loss. If there is no realistic

prospect of recovery, the asset is written off.

Derivatives and hedge accounting

Derivative financial instruments are used to manage exposure to market risks. The derivative instruments

used by the Group are forward foreign exchange contracts and swaps, interest rate swaps and cross

currency interest rate swaps.

Derivative financial instruments are classified as held-for-trading and are measured at fair value. Derivatives

designated as hedging instruments are classified on inception as fair value hedges, cash flow hedges or net

investment hedges. The treatment of changes in the value of derivatives depends on their use as explained

below.

Fair value hedges

Certain derivatives are held to hedge the risk of changes in value of a specific bond or other loan. In these

situations, the Group designates the liability and related derivative to be part of a fair value hedge

relationship. The carrying value of the bond is adjusted by the fair value of the risk being hedged, with

changes going to the income statement. Gains and losses on the corresponding derivative are also

recognised in the income statement. The amounts recognised are offset in the income statement to the

extent that the hedge is effective. Ineffectiveness may occur if the critical terms do not exactly match, or if

there is a value adjustment resulting from a change in credit risk (in either the Group or the counterparty to

the derivative) that is not matched by the hedged item. When the relationship no longer meets the criteria

for hedge accounting, the fair value hedge adjustment made to the bond is amortised to the income

statement using the effective interest method.

Cash flow hedges

Derivatives are also held to hedge the uncertainty in timing or amount of future forecast cash flows.

Such derivatives are designated as being part of cash flow hedge relationships. For an effective hedge,

gains and losses from changes in the fair value of derivatives are recognised in equity. Any ineffective

elements of the hedge are recognised in the income statement. Ineffectiveness may occur if there are

changes to the expected timing of the hedged transaction. If the hedged cash flow relates to a non-

financial asset, the amount accumulated in equity is subsequently included within the carrying value of

that asset. For other cash flow hedges, amounts deferred in equity are taken to the income statement at

the same time as the related cash flow. When a derivative no longer qualifies for hedge accounting, any

cumulative gain or loss remains in equity until the related cash flow occurs. When the cash flow takes

place, the cumulative gain or loss is taken to the income statement. If the hedged cash flow is no longer

expected to occur, the cumulative gain or loss is taken to the income statement immediately.

Net investment hedges

Certain derivatives and financial liabilities are designated as hedges of the currency risk on the Group’s

investment in foreign subsidiaries. Differences arising on retranslation of a financial liability designated as

hedging instrument in a net investment hedge and the fair value of derivatives are recorded in equity to the

extent that the hedge is effective. These differences on retranslation of financial liability and the fair value

of derivatives are reported within the income statement to the extent that the hedge is ineffective. Gains

and losses accumulated in equity are included in the income statement when the foreign operation is

disposed of.

Derivatives for which hedge accounting is not applied

Derivatives not designated as hedges are held in order to economically hedge certain balance sheet items

and commodity exposures. No hedge accounting is applied to these derivatives, which are carried at fair

value with changes being recognised in the income statement.

Risk management

The key objectives of the Group’s treasury activities are to minimise the net cost of financial operations

and reduce volatility arising from financial risks.

Treasury activities are governed by the Board. The Group has a Treasury Risk Committee (TRC), chaired

by the CFO, that meets on a regular basis to review treasury activities. The TRC’s members receive

management information relating to treasury activities.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

154

The Group may use a variety of financial instruments to finance its operations and derivative financial

instruments to manage market risks from these operations. Derivatives comprise of foreign exchange

forward contracts and swaps, interest rate swaps and cross currency interest swaps which are used to

manage foreign exchange and interest rate risk on borrowings.

Derivatives are used exclusively for hedging purposes in relation to underlying business activities and not

as trading or speculative instruments.

Capital management

The Group manages its capital to ensure that entities in the Group are able to operate as going concerns

whilst availing themselves of intercompany funding where appropriate.



	2025	2024
	£m	£m
Cash and cash equivalents	1,324	2,250
Short-term borrowings	(836)	(1,487)
Long-term borrowings	(7,773)	(8,640)
Derivative financial assets associated with long-term borrowings	3	–
Derivative financial liabilities associated with long-term borrowings	(23)	(68)
Total equity	16,484	16,224
Total capital	9,179	8,279

In April 2025, the Group’s long-term credit rating with Moody’s Investor Service (Moody’s) was upgraded

from Baa1 to A3. As at 31 December 2025, the Group’s long-term credit rating with S&P is BBB+ (stable

outlook) (2024: BBB+) and with Moody’s Investors Service (Moody’s) it is A3 (stable outlook) (2024: Baa1).

The Group’s short-term credit ratings are A-2 and P-2 with S&P and Moody’s, respectively (2024: A-2 and

P-2 respectively).

Liquidity risk management

The Group’s policy is to borrow centrally (where permissible and cost effective) in order to meet

anticipated funding requirements. The strategy is to diversify liquidity sources and to maintain broad

access to financial markets. Each day, the Group sweeps cash to or from a number of global subsidiaries

to central treasury accounts for liquidity management purposes.

The Group uses both notional and zero-balancing cash pool arrangements as appropriate by location

and currency. For notional cash pools, liquidity is drawn against foreign currency balances to provide both

local funding and central liquidity as required and with balances actively managed and maintained to

appropriate levels. As balances in notional pooling arrangements are not settled across currencies, gross

cash and overdraft balances are reported. At 31 December 2025, the Group had £836m (2024: £1,487m)

of borrowings repayable within one year and held £1,324m (2024: £2,250m) of cash and cash equivalents.

The Group has access to a £1,750m revolving credit facility with an initial maturity date of August 2028.

This committed facility was undrawn as at 31 December 2025.

Long-term financing consists of $6,000m in USD bonds, as well as €2,250m Euro bonds and £1,000m GBP

bonds outstanding at 31 December 2025. The Group also has a CNY2,824m bank loan. Refer to Note 19

‘Borrowings’ for further details about the Group’s bonds.

Foreign exchange risk management

Foreign currency transaction exposures arising on internal and external trade flows are selectively hedged.

The Group’s objective is to minimise the exposure of overseas operating subsidiaries to transaction risk by

matching local currency income with local currency costs where possible. Foreign currency cash flows may

be hedged selectively as approved by the TRC. Cash surpluses or borrowing requirements of subsidiary

companies are usually managed centrally using foreign exchange forward contracts and swaps to hedge

future repayments back into the originating currency.

Borrowings denominated in, or swapped into, foreign currencies that match investments in overseas Group

assets may be treated as a hedge against the relevant assets. Forward contracts in major currencies are

also used to reduce exposure to the Group’s investment in overseas assets. Refer to ‘Net investment

hedges’ section of this Note for further details.

Credit risk management

Credit risk is the risk that a counterparty will default on its contractual obligations, resulting in financial

loss to the Group, and arises on cash and cash equivalents and favourable derivative financial instruments

held with banks and financial institutions as well as credit exposures to wholesale and retail customers,

including outstanding receivables.

The Group considers its maximum credit risk to be £1,411m (2024: £2,380m) which is the total of the

Group’s financial assets, excluding other investments which bear equity risk rather than credit risk.

There has been no change in the estimation techniques or significant assumptions made during the current

reporting period in assessing the loss allowance for financial assets at amortised cost since the adoption

of IFRS 9.

Treasury-related credit risk

The aggregate credit risk in respect of financial instruments that the Group may have with a counterparty

is limited according to the assessed risk of each counterparty. Exposures are regularly monitored against

credit limits in accordance with Treasury policy, as approved by the Board.

Expected credit losses on cash and cash equivalents and on third-party financial derivatives for 2025 are

assessed to be immaterial and therefore have not been recognised. No such losses were incurred in 2024

or 2023.

The following table summarises the Group’s assessment of its counterparty credit risk.

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Annual Report and Form 20-F 2025

155

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | | | | | BB+ | |
| | | | | | and below | |
| | AAA | AA | A | BBB | or unrated | Total |
| | £m | £m | £m | £m | £m | £m |
| 2025 | | | | | | |
| Bank balances and deposits | – | – | 658 | 7 | 42 | 70

7 |
| Money market funds | 608 | – | – | – | – | 608 |
| Government securities | – | – | – | – | 9 | 9 |
| Cash and cash equivalents | 608 | – | 658 | 7 | 51 | 1,324 |
| Derivative financial instruments | – | 13 | 74 | – | – | 8

7 |
| Total | 608 | 13 | 732 | 7 | 51 | 1,411 |
| 2024 | | | | | | |
| Bank balances and deposits | – | 1 | 1,658 | 10 | 27 | 1,696 |
| Money market funds | 554 | – | – | – | – | 554 |
| Government securities | – | – | – | – | – | – |
| Cash and cash equivalents | 554 | 1 | 1,658 | 10 | 2

7 | 2,250 |
| Derivative financial instruments | – | 14 | 116 | – | – | 130 |
| Total | 554 | 15 | 1,774 | 10 | 2

7 | 2,380 |

Wholesale and retail credit risk

The Group does not have a substantial wholesale and retail credit risk as a result of its diversified

geographical presence, product offering, consumer profile and historical credit loss information. Where

appropriate, the Group utilises credit insurance and receivables factoring to minimise the credit risk of the

trade receivables in the Group (refer to Note 16 ‘Trade and other receivables’ for further details about the

Group’s expected credit losses). Factoring arrangements are based on a portfolio approach and are used

to mitigate risk arising from large credit risk concentrations. All factoring arrangements are non-recourse.

Interest rate risk management

The Group manages the interest rate risk on its net debt portfolio, with the objectives of minimising the

effective net interest cost and income statement volatility.

The Group’s main interest rate risk arises from borrowings and investments with floating rates and from the

refinancing of maturing fixed-rate debt where any changes in interest rates will affect future cash flows.

The policy on interest rate risk management limits the net amount of floating-rate debt to a specific cap.

Of the Group’s debt, 57% was held at fixed rates as at 31 December 2025 (2024: 59%), including the impact

of swaps. Any bond debt with less than three months to maturity is considered floating rate.

Interest rate and forward starting interest rate swaps

The forward starting interest rate contracts, exchanging floating interest for fixed interest, were designated

as cash flow hedges to pre-hedge the interest variability of the interest cash flows associated with the

fixed-rate debt issued in 2022.

The interest rate swap contracts, exchanging fixed interest rate for floating interest, have been designated

as fair value hedges to hedge the variability in fair value associated with the Group’s fixed-rate debt.

The interest rate swaps and the interest payments on the loan occur simultaneously and the fair value

of interest rate swaps and the fair value of related debt affect the income statement at the same time.

Derivative financial instruments and hedging

Derivative financial instruments are used to mitigate exposure to foreign exchange transactional risks of

the Group. The fair value of a derivative financial instrument is classified as a non-current asset or liability

if the remaining maturity is more than 12 months and as a current asset or liability if the maturity is less

than 12 months.

The Group has the following derivative financial instruments:

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | 2025 | | | 2024 | | |
| | | | Fair value | | | Fair value |
| | Notional | Fair value | of | Notional | Fair value | of |
| | amount | of assets | liabilities | amount | of assets | liabilities |
| | £m | £m | £m | £m | £m | £m |
| Non-current | | | | | | |
| Fair value hedges – interest rate swap | | | | | | |
| contracts | 2,640 | 3 | (23) | 2,445 | – | (63) |
| Net investment hedges – foreign exchange | | | | | | |
| contracts | 930 | 6 | (11) | 175 | – | (2) |
| Current | | | | | | |
| Fair value hedges – interest rate swap | | | | | | |
| contracts | 742 | – | (1) | 1,396 | – | (18) |
| Net investment hedges – cross currency | | | | | | |
| interest rate swaps | – | – | – | 910 | 61 | – |
| Net investment hedges – foreign exchange | | | | | | |
| contracts | 1,392 | 41 | (17) | 1,149 | 39 | (20) |
| Cash flow hedges – foreign exchange | | | | | | |
| contracts | 75

7 | 11 | (10) | 538 | 13 | (17) |
| Derivatives designated and effective as | | | | | | |
| hedging instruments | 6,461 | 61 | (62) | 6,613 | 113 | (120) |
| Non-current | | | | | | |
| Cross currency interest rate swap contracts | – | – | – | 499 | – | (5) |
| Current | | | | | | |
| Cross currency interest rate swap contracts | 499 | 22 | – | 910 | – | (31) |
| Foreign exchange contracts | 1,399 | 4 | (3) | 2,032 | 17 | (4) |
| Derivatives classified as held for trading | 1,898 | 26 | (3) | 3,441 | 1

7 | (40) |
| Total derivative instruments | 8,359 | 8

7 | (65) | 10,054 | 130 | (160) |

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

156

Fair value hedges

At issuance in March 2022, $1,750m and €850m bonds were converted from fixed rate to floating rate

using interest rate swaps. Further, in April and May 2023 additional $1,400m of bonds issued in March

2022 were converted from fixed to floating rate using interest rate swaps.

At issuance in September 2024, €750m bond was converted from fixed rate to floating rate using interest

rate swaps. During second half of 2025, $800m and £350m bonds issued in 2022 and 2024 were converted

from fixed rate to floating rate using interest rate swaps.

Cash flow hedges

In 2023, the Group established a programme of hedging highly probable forecast transactional foreign

exchange exposure using foreign exchange contracts (FX forwards and FX swaps). The key exposure

designated under cash flow hedge accounting are forecast receipts from customers and payments to

suppliers, capital expenditure and other administration expenses payable in foreign currency.

In 2024, the Group entered into forward starting interest rate swaps (derivatives) to pre-hedge interest

rate risk on the fixed rate bonds issued in September 2024. These derivatives were designated in a cash

flow hedge relationship. The derivatives were settled in September 2024 and as a result cash flow hedges

were terminated with a net cash outflow of £3m. The element of gains/losses of these cash flow hedges

relating to other comprehensive income is being amortised to the income statement as per the maturity

profile of the loan notes.

Net investment hedges

At 31 December 2025 and 31 December 2024, certain foreign exchange contracts and cross currency

interest rate swaps were designated as net investment hedges in respect of the foreign currency

translation risk arising on consolidation of the Group’s net investment in its foreign operations as shown

in the table above.

The carrying value of the EUR bonds in Note 19 ‘Borrowings’ included £2,169m (2024: £2,062m) that

were also designated as hedging instruments in net investment hedges in respect of the foreign currency

translation risk arising on consolidation of the Group’s net investment in its European (Euro) foreign

operations. For net investment hedges, the balance in the foreign currency translation reserve in relation

to continuing hedges is £(125)m (2024: £(155)m).

The following tables provide information regarding hedging instruments and the related hedged items as

at 31 December:

Hedging instruments



			Change in fair
			value	Carrying
		Notional	for recognising	value
		principal	hedge	assets/
	Average	value	ineffectiveness	(liabilities)
	strike price	£m	£m	£m
2025
Cash flow hedges
Below 10 years
FX forward contracts/FX swaps	N/ A	75 7	1	1
Fair value hedges
Below 10 years
EUR IRS	2.0%	1,39 7	(8)	(8)
USD IRS	3.8%	1,635	(16)	(16)
GBP IRS	3.9%	350	3	3
Net investment hedges
Below 10 years
EUR FX Swaps/forwards	1.1	171	(1)	(1)
CNH FX Swaps/forwards	8.9	1,243	1	1
AUD FX Swaps/forwards	2.1	86	(3)	(3)
CAD FX Swaps/forwards	1.8	360	3	3
USD FX Swaps/forwards	1.3	416	16	16
TWD FX Swaps/forwards	40.1	46	2	2
EUR Bonds	N/ A	2,183	10 7	(2,169)
2024
Cash flow hedges
Below 10 years
FX forward contracts/FX swaps	N/A	538	(4)	(4)
Fair value hedges
Below 10 years
EUR IRS	2.0%	1,328	(20)	(20)
USD IRS	3.4%	2,512	(61)	(61)
Net investment hedges
Below 10 years
EUR FX Swaps/forwards	1.2	384	8	8
CNH FX Swaps/forwards	9.0	716	(6)	(6)
AUD FX Swaps/forwards	2.0	81	3	3
CAD FX Swaps/forwards	1.6	96	11	11
TWD FX Swaps/forwards	40.1	47	1	1
CNH CCIRS	8.6	910	61	61
EUR Bonds	N/A	2,076	77	(2,062)

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

157

Hedged items


	2025				2024
			Change in	Balance			Change in	Balance
			value for	in cash			value for	in cash
		Accumulated	calculating	flow		Accumulated	calculating	flow
	Carrying	fair value	hedge	hedge	Carrying	fair value	hedge	hedge
	amount	adjustments 1	ineffectiveness	reserve 2	amount	adjustments 1	ineffectiveness	reserve 2
	£m	£m	£m	£m	£m	£m	£m	£m
Cash flow hedges
Pre-hedging of long-
term interest rate	–	–	–	(97)	–	–	–	(114)
Transactional FX
forecast exposure 3	75 7	–	–	(4)	538	–	–	1
Fair value hedges
Bonds 4	(2,703)	21	21	–	(3,188)	81	81	–
Net investment
hedges
Net assets in foreign
currency 5	4,505	(125)	(125)	–	4,310	(155)	(155)	–

Accumulated fair value adjustments on the hedged items included in the carrying amount of the hedged item.

Balance in cash flow hedge reserve for continued transactional FX forecast hedges and discontinued hedges net of tax.

In 2023 the Group established a programme to hedge forecast transactional foreign exchange exposure.

The difference in change in value for calculating hedge ineffectiveness between derivatives and bonds is due to upfront

cash receipt on derivatives and hedge ineffectiveness.

Relates to net investment hedges which is part of the translation reserve in equity.

The following table details the effectiveness of the hedging relationships and the amounts reclassified

from the hedging reserve to the income statement for cash flow hedges, recognised under finance income

or expense. There was no ineffectiveness on fair value on net investment hedges.



	Hedging		Hedged
	gains/(losses)		future cash
	in other	Hedge	flows no	As hedged
	comprehensive	ineffectiveness	longer expected	item affects
	income	in profit or loss	to occur	profit or loss
	£m	£m	£m	£m
2025
Cash flow hedges
Transactional FX hedge	19	–	–	1 7
Pre-hedging of long-term interest rates
Below 10 years	121	–	–	19
10-30 years	18	–	–	2
2024
Cash flow hedges
Transactional FX hedge	9	–	–	11
Pre-hedging of long-term interest rates
Below 10 years	138	–	–	20
10-30 years	23	–	–	2

Fair value of financial assets and liabilities excluding lease liabilities

The table below presents the carrying amounts and the fair values of the Group’s financial assets and

liabilities. The fair values of the financial assets and liabilities are included at the price that would be

received to sell an asset or paid to transfer a liability in an orderly transaction between market participants

at the measurement date.

The following methods and assumptions were used to estimate the fair values:

Cash and cash equivalents carried at amortised cost, trade and other receivables and certain other

non-current assets, loan amounts owing from/(to) related parties, trade and other payables and

certain other non-current liabilities: approximates to the carrying amount.

Cash and cash equivalents (money market funds) carried at fair value: based on net asset value of the

funds.

Short-term loans, overdrafts and commercial paper: approximates to the carrying amount because of

the short maturity of these instruments.

Interest rate swaps and foreign exchange contracts: based on present value of contractual cash flows

using market-sourced data (exchange rates and interest rates) at the balance sheet date.

Long-term loans: based on executable quotes or thinly traded prices (a level 2 fair value measurement)

for European and US Medium Term Notes; based on present value of contractual cash flows for non-

voting preference shares and based on the approximation of the carrying amount in the case of other

floating-rate bank loans.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

158

| | | | | |
| --- | --- | --- | --- | --- |
| | 2025 | | 2024 | |
| | Carrying | | Carrying | |
| | value | Fair value | value | Fair value |
| | £m | £m | £m | £m |
| Financial assets at fair value through other | | | | |
| comprehensive income: | | | | |
| Unlisted equity investments | 6

7 | 6

7 | 82 | 82 |
| Financial assets measured at amortised cost: | | | | |
| Cash and cash equivalents (including government | | | | |
| securities) | 716 | 716 | 1,696 | 1,696 |
| Trade and other receivables and certain other non- | | | | |
| current assets | 1,818 | 1,818 | 1,796 | 1,796 |
| Financial assets mandatorily measured at fair value | | | | |
| through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | 26 | 26 | 17 | 17 |
| Cash and cash equivalents (money market funds) | 608 | 608 | 554 | 554 |
| Derivatives designated and effective as hedging | | | | |
| instruments | | | | |
| Fair value hedge | 3 | 3 | – | – |
| Cash flow hedge | 11 | 11 | 13 | 13 |
| Net investment hedge | 4

7 | 4

7 | 100 | 100 |
| Total financial assets | 3,296 | 3,296 | 4,258 | 4,258 |
| Financial liabilities measured at amortised cost: | | | | |
| Short-term loans and overdrafts | (49) | (49) | (43) | (43) |
| Other bonds | (3,448) | (3,292) | (4,397) | (4,006) |
| Long-term loans | (300) | (300) | (290) | (290) |
| Non-voting preference shares | (25) | (25) | (25) | (25) |
| Trade and other payables and certain other non-current | | | | |
| liabilities in scope of IFRS 9 | (3,333) | (3,333) | (3,470) | (3,470) |
| Bonds in a designated hedge relationship | (4,654) | (4,438) | (5,249) | (5,108) |
| Financial liabilities mandatorily measured at fair value | | | | |
| through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | (3) | (3) | (40) | (40) |
| Derivatives designated and effective as hedging | | | | |
| instruments | | | | |
| Fair value hedge | (24) | (24) | (81) | (81) |
| Cash flow hedge | (10) | (10) | (17) | (17) |
| Net investment hedge | (28) | (28) | (22) | (22) |
| Total financial liabilities | (11,874) | (11,502) | (13,634) | (13,102) |
| Net financial assets and financial liabilities | (8,578) | (8,206) | (9,376) | (8,844) |

Financial instruments held at fair value shown according to the fair value hierarchy is provided below.

Financial assets and liabilities held at fair value are categorised by the valuation methodology applied in

determining their fair value. Where possible, quoted prices in active markets are used (level 1). Where such

prices are not available, the asset or liability is classified as level 2, provided all significant inputs to the

valuation model used are based on observable market data. If one or more of the significant inputs to

the valuation model is not based on observable market data, the instrument is classified as level 3. The

methods and assumptions used to estimate the fair values of significant financial instruments on the

balance sheet are consistent with those applied for the year ended 31 December 2024.

The equity investment that is valued at Level 3 is a passive investment in a private entity acquired as part

of the consideration received for the divestment of ChapStick. In the absence of specific and active market

data, the investment is held at fair value based on a multiple of the latest available rolling 12-month

earnings before interest depreciation and amortisation (EBITDA) and adjusted for net debt, which

approximates to fair value.

| | | | | |
| --- | --- | --- | --- | --- |
| | Level 1 | Level 2 | Level 3 | Total |
| At 31 December 2025 | £m | £m | £m | £m |
| Financial assets at fair value through other | | | | |
| comprehensive income: | | | | |
| Unlisted equity investments | – | – | 6

7 | 6

7 |
| Financial assets at fair value through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | – | 26 | – | 26 |
| Cash and cash equivalents (money market funds) | 608 | – | – | 608 |
| Derivatives designated and effective as hedging | | | | |
| instruments: | | | | |
| Fair value hedge | – | 3 | – | 3 |
| Cash flow hedge | – | 11 | – | 11 |
| Net investment hedge | – | 4

7 | – | 4

7 |
| Total financial assets | 608 | 8

7 | 6

7 | 762 |
| Financial liabilities at fair value through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | – | (3) | – | (3) |
| Derivatives designated and effective as hedging | | | | |
| instruments | | | | |
| Fair value hedge | – | (24) | – | (24) |
| Cash flow hedge | – | (10) | – | (10) |
| Net investment hedge | – | (28) | – | (28) |
| Total financial liabilities | – | (65) | – | (65) |

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

159

| | | | | |
| --- | --- | --- | --- | --- |
| | Level 1 | Level 2 | Level 3 | Total |
| At 31 December 2024 | £m | £m | £m | £m |
| Financial assets at fair value through other | | | | |
| comprehensive income: | | | | |
| Unlisted equity investments | – | – | 82 | 82 |
| Financial assets at fair value through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | – | 17 | – | 1

7 |
| Cash and cash equivalents (money market funds) | 554 | – | – | 554 |
| Derivatives designated and effective as hedging | | | | |
| instruments: | | | | |
| Cash flow hedge | – | 13 | – | 13 |
| Net investment hedge | – | 100 | – | 100 |
| Total financial assets | 554 | 130 | 82 | 766 |
| Financial liabilities at fair value through profit or loss: | | | | |
| Held for trading derivatives that are not in a designated | | | | |
| and effective hedging relationship | – | (40) | – | (40) |
| Derivatives designated and effective as hedging | | | | |
| instruments | | | | |
| Fair value hedge | – | (81) | – | (81) |
| Cash flow hedge | – | (17) | – | (17) |
| Net investment hedge | – | (22) | – | (22) |
| Total financial liabilities | – | (160) | – | (160) |

Other assets and liabilities in scope of IFRS 9

Trade and other receivables and other non-current assets

The following table reconciles financial instruments within trade and other receivables and other non-

current assets which fall within the scope of IFRS 9 to the relevant balance sheet amounts.

The financial assets are predominantly non-interest earning. Non-financial instruments include tax

receivables and prepayments, which are outside the scope of IFRS 9.


	At 31 December 2025			At 31 December 2024
		Non-			Non-
	Financial	financial		Financial	financial
	instruments	instruments	Total	instruments	instruments	Total
	£m	£m	£m	£m	£m	£m
Trade and other receivables (Note 16)	1,801	25 7	2,058	1,780	275	2,055
Other non-current assets (Note 16)	1 7	20	3 7	16	55	71
Total	1,818	27 7	2,095	1,796	330	2,126

Trade and other payables, other provisions and other non-current liabilities

The following table reconciles financial liabilities within trade and other payables, other provisions and

other non-current liabilities which fall within the scope of IFRS 9 to the relevant balance sheet amounts.

Accrued wages and salaries are included within financial liabilities. Non-financial instruments include

payments on account, tax and social security payables and provisions which do not arise from contractual

obligations to deliver cash or another financial asset, which are outside the scope of IFRS 9.


	At 31 December 2025			At 31 December 2024
		Non-			Non-
	Financial	financial		Financial	financial
	instruments	instruments	Total	instruments	instruments	Total
	£m	£m	£m	£m	£m	£m
Trade and other payables (Note 18)	(3,305)	(425)	(3,730)	(3,268)	(437)	(3,705)
Other financial liability (Note 27)	–	–	–	(177)	–	(177)
Provisions (Note 21)	(7)	(102)	(109)	(5)	(170)	(175)
Other non-current liabilities	(21)	(9)	(30)	(20)	(8)	(28)
Total	(3,333)	(536)	(3,869)	(3,470)	(615)	(4,085)

Offsetting of financial assets and liabilities

Financial assets and liabilities are offset and the net amount reported in the balance sheet where there is a

legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis

or realise the asset and settle the liability simultaneously. There are also arrangements that do not meet

the criteria for offsetting but still allow for the related amounts to be offset in certain circumstances, such

as bankruptcy or the termination of a contract.

The following tables set out the financial assets and liabilities that are offset, or subject to enforceable

master netting arrangements and other similar agreements but not offset, as at 31 December 2025 and

31 December 2024. The column ‘Net amount’ shows the impact on the Group’s balance sheet if all offset

rights were exercised.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

160

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | |
| | | Gross | Net financial | | |
| | Gross | financial | assets/ | | |
| | financial | assets/ | (liabilities) | Related | |
| | assets/ | (liabilities) | per balance | amounts | Net |
| | (liabilities) | set off | sheet | not offset | amount |
| At 31 December 2025 | £m | £m | £m | £m | £m |
| Financial assets | | | | | |
| Derivative financial assets | 8

7 | – | 8

7 | (47) | 40 |
| Financial liabilities | | | | | |
| Derivative financial liabilities | (65) | – | (65) | 4

7 | (18) |



		Gross	Net financial
		financial	assets/
	Gross financial	assets/	(liabilities)	Related
	assets/	(liabilities)	per balance	amounts	Net
	(liabilities)	set off	sheet	not offset	amount
At 31 December 2024	£m	£m	£m	£m	£m
Financial assets
Derivative financial assets	130	–	130	(90)	40
Financial liabilities
Derivative financial liabilities	(160)	–	(160)	90	(70)

Amounts which do not meet the criteria for offsetting on the balance sheet but could be settled net

in certain circumstances principally relate to derivative transactions under International Swaps and

Derivatives Association (ISDA) agreements where each party has the option to settle amounts on a net

basis in the event of default of the other party. As there is presently not a legally enforceable right of

offset, these amounts have not been offset in the balance sheet but have been presented separately

in the tables above.

Sensitivity analysis

Foreign exchange sensitivity

The two major foreign currencies in which the Group’s financial instruments are denominated are US Dollars

and Euros. Financial instruments are only considered sensitive to foreign exchange rates where they are not

in the functional currency of the entity that holds them. Intercompany loans which are fully hedged to

maturity with a currency swap have been excluded from this analysis.



	2025	2024
	Increase/(decrease)	Increase/(decrease)
	in income	in income
	£m	£m
10 cent appreciation of the US Dollar	3	2
10 cent depreciation of the US Dollar	(3)	(2)
10 cent appreciation of the Euro	(2)	1
10 cent depreciation of the Euro	2	–

The equity impact, shown below, for foreign exchange sensitivity relates to derivative and non-derivative

financial instruments hedging the Group’s net investments in its European (Euro) and Chinese (CNY) foreign

operations and cash flow hedges of its foreign exchange exposure arising in Euro and US Dollar.



	2025	2024
	(Decrease)/increase	(Decrease)/increase
	in equity	in equity
	£m	£m
10 cent appreciation of the CNY	(13)	(17)
10 cent depreciation of the CNY	13	17
10 cent appreciation of the Euro	(216)	(189)
10 cent depreciation of the Euro	182	160
10 cent appreciation of the US Dollar	(33)	(6)
10 cent depreciation of the US Dollar	29	5

Interest rate sensitivity

The Group is exposed to interest rate risk on its outstanding borrowings and investments where any

changes in interest rates will affect future cash flows or the fair values of financial instruments. The table

below shows the Group’s hypothetical sensitivity to changes in interest rates in relation to Pound Sterling,

US Dollar and Euro variable rate financial assets and liabilities, including derivatives. If the interest rates

applicable to floating-rate financial assets and liabilities were to have increased by 1% (100 basis points),

and assuming other variables had remained constant, it is estimated that the Group’s finance income for

2025 would have decreased by approximately £10m (2024: decreased by approximately £12m). A 1% (100

basis points) movement in US Dollar interest rates would not have any impact to equity (2024: no impact

to equity). A 1% (100 basis points) movement in interest rates in relation to Pound Sterling or Euro is not

deemed to have a material effect on equity (2024: not deemed to have a material effect on equity).



	2025	2024
	Increase/(decrease)	Increase/(decrease)
	in income	in income
	£m	£m
1% (100 basis points) increase in Pound Sterling interest rates	16	13
1% (100 basis points) increase in US Dollar interest rates	(19)	(17)
1% (100 basis points) increase in Euro interest rates	(7)	(8)

Contractual cash flows for non-derivative financial liabilities and derivative instruments

The following table provides an analysis of the anticipated contractual cash flows including interest

payable for the Group’s borrowings on an undiscounted basis. Interest is calculated based on debt held at

the balance sheet date without taking account of future issuance. Floating-rate interest is estimated using

the prevailing interest rate at the balance sheet date. Cash flows in foreign currencies are translated using

spot rates at the balance sheet date.

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

161

| | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | |
| | | | | | Trade | |
| | | | | | payables | |
| | | | | | and other | |
| | | | | Interest | liabilities | |
| | | Interest on | Lease | on lease | not in | |
| | Borrowings | borrowings | liabilities | liabilities | net debt | Total |
| At 31 December 2025 | £m | £m | £m | £m | £m | £m |
| Due in less than one year | 788 | 253 | 48 | 4 | 3,324 | 4,41

7 |
| Between one and two years | 1,54

7 | 210 | 43 | 2 | 8 | 1,810 |
| Between two and three years | 1,012 | 190 | 12 | 1 | 1 | 1,216 |
| Between three and four years | 89

7 | 148 | 7 | 1 | – | 1,053 |
| Between four and five years | 668 | 129 | 4 | – | – | 801 |
| After five years | 3,539 | 888 | 19 | – | – | 4,446 |
| Gross contractual cash flows | 8,451 | 1,818 | 133 | 8 | 3,333 | 13,743 |
| At 31 December 2024 | | | | | | |
| Due in less than one year | 1,437 | 270 | 50 | 3 | 3,485 | 5,245 |
| Between one and two years | 694 | 253 | 36 | 2 | 8 | 993 |
| Between two and three years | 1,587 | 209 | 19 | 1 | 1 | 1,81

7 |
| Between three and four years | 919 | 190 | 9 | – | – | 1,118 |
| Between four and five years | 1,075 | 149 | 6 | – | – | 1,230 |
| After five years | 4,267 | 1,072 | 3 | – | – | 5,342 |
| Gross contractual cash flows | 9,979 | 2,143 | 123 | 6 | 3,494 | 15,745 |

The table below provides an analysis of the anticipated contractual cash flows for the Group’s derivative

instruments, using undiscounted cash flows. Cash flows in foreign currencies are translated using spot rates

at 31 December. The gross cash flows of foreign exchange contracts are presented for the purposes of

this table although, in practice, the Group uses standard settlement arrangements to reduce its liquidity

requirements on these instruments.



	2025		2024
	Receivables	Payables	Receivables	Payables
	£m	£m	£m	£m
Foreign exchange contracts
Due in less than one year	7,039	(7,013)	8,912	(8,873)
Between one and two years	170	(161)	103	(100)
Between two and three years	–	–	110	(104)
Between four and five years	894	(829)	–	–
Interest rate swap contracts
Due in less than one year	1,366	(1,350)	3,302	(3,330)
Between one and two years	371	(367)	1,242	(1,242)
Between two and three years	696	(697)	341	(347)
Between three and four years	255	(255)	620	(625)
Between four and five years	49	(52)	223	(227)
After five years	1,244	(1,257)	458	(468)
Gross contractual cash flows	12,084	(11,981)	15,311	(15,316)

26. Employee share schemes

Incentives in the form of share awards are provided to employees under share schemes. The fair value of

equity-settled share schemes is calculated at the grant date using a fair value model and is charged to the

income statement over the vesting period with a corresponding adjustment to the equity share-based

payment reserve. At the end of each reporting period, the Group reviews its charge and revises it accordingly

based on the number of shares expected to vest. The impact of the revision of the original estimates, if any, is

recognised in profit or loss such that the cumulative expense reflects the revised estimate.

For cash-settled share-based payments, the fair value of service rendered is based on the fair value of the

liability related to the share-based instrument granted.

Description of the Group’s plans

The Group operates a number of share-based payment schemes for Executive Directors and other

employees which are predominantly equity-settled, however may be cash-settled in certain locations.

Performance Share Plan

Under the Performance Share Plan, awards are granted to Executive Directors and other employees over

ordinary shares or ADSs in Haleon plc at no cost. The percentage of each award that vests is based upon

the performance of the Group over a defined measurement period with dividends reinvested during the

same period. The performance conditions attached to each award are based on three measures over a

three-year performance period. These are cumulative free cash flow (50%), adjusted diluted EPS growth

(30%) and organic operating margin improvement (20%). In addition, an environmental, social and

governance (ESG) qualifier applies which can reduce the level of the overall vesting by up to 75%.

Share Value Plan

Under the Share Value Plan, awards are granted to qualifying employees over ordinary shares or ADSs

in Haleon plc at no cost. These awards generally vest after three years and there are normally no

performance conditions attached. The fair value of these awards is determined based on the closing share

price on the day of grant and adjusted for the expected dividend yield of 2.06% (2024: 2.22%, 2023: 1.54%)

during the vesting period.

Sharesave and Share Reward Plans

The Sharesave and Share Reward Plans are HMRC-approved savings-related plans. These plans are made

available to all UK employees.

The Sharesave Plan enables participants to save up to £500 per month, over a fixed three-year period.

At the end of the fixed period the savings can be used to purchase ordinary shares in the Company at a

predetermined discount of up to 20%, which is set at the time of each Sharesave launch.

Participants of the Share Reward Plan contribute up to £125 per month to purchase Haleon plc ordinary

shares. The Company then matches these purchases on a one-for-one basis. Participants are eligible to receive

dividends during the holding period either as cash or reinvested to buy further shares. The shares are placed

in a UK resident trust and are available to the individual with tax advantages after a five-year period.

Deferred Annual Bonus Plan (DABP)

Executive Directors are required to defer 50% of any bonus earned into an award over ordinary shares

or ADSs under the DABP, which will normally vest on the third anniversary of grant, subject to continued

employment. DABP awards are eligible for dividend equivalent payments in respect of dividends that

would have been paid on the ordinary shares or ADSs up to the date the awards vest.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

162

The total cost of each of the relevant schemes is as below:


Charge (£m)	2025	2024
Equity-settled
Performance Share Plan	25	29
Share Value Plan	60	72
Sharesave Plan	1	1
Cash-settled
Performance Share Plan	1	1
Share Value Plan	8	14
Total	95	11 7

The Group has £20m of outstanding liabilities as at 31 December 2025 in relation to cash-settled awards

(2024: £25m). There were £13m worth of releases from Group cash-settled provision in 2025 (2024: £3m).

There were no cancellations or modifications to awards in 2025 or 2024.

The movements in ordinary shares, ADS awards and share options during the year, split between each of

the relevant schemes, are shown below:


	Performance Share				Sharesave
	Plan		Share Value Plan		Plan 1
	Ordinary
Number of share awards ('000)	shares	ADS	Ordinary shares	ADS	Share options
At 1 January 2024	19,041	3,551	38,941	12,855	5,490
Awards granted	11,830	945	18,442	5,329	757
Dividends reinvested	475	54	14	–	n/a
Awards released/exercised	(537)	(573)	(6,495)	(2,080)	(206)
Awards forfeited	(3,130)	(1,060)	(6,032)	(2,199)	(670)
At 31 December 2024	27,679	2,91 7	44,870	13,905	5,371
Awards granted	10,241	841	17,50 7	5,414	1,711
Dividends reinvested	491	44	18	–	n/a
Awards released/exercised	(6,529)	(820)	(14,555)	(4,629)	(472)
Awards forfeited	(4,797)	(492)	(4,515)	(1,273)	(363)
At 31 December 2025	27,085	2,490	43,325	13,41 7	6,24 7

Number of share options exercisable as at 31 December 2025 was 510,361 (2024: 156,008).

Fair value of awards

The weighted average fair values of share awards and share options granted during the year were as below:


Weighted fair value	2025	2024
Performance Share Plan
Ordinary shares	£3.91	£3.46
ADSs	$8.96	$8.62
Share Value Plan
Ordinary shares	£3.74	£3.20
ADSs	$9.72	$8.14
Sharesave Plan 1
Share options	£1.00	£1.04

Weighted average exercise prices (£) for options exercised during the year was £2.30 (2024: £2.28).

For the purposes of valuing options in relation to the Sharesave Plan to arrive at the share-based payment

charge, a Black-Scholes option pricing model has been used. The assumptions used in the model are

as follows:


	2025 Grant	2024 Grant
Weighted average fair value at the measurement date (£)	1.00	1.04
Risk-free interest rate (%)	3.79	4.22
Expected dividend yield (%)	2.28	2.02
Volatility (%)	21.19	20.94
Expected life (years)	3.5	3.50
Sharesave Plan-related options grant price (including 20% discount) (£)	2.94	3.00

The expected volatility reflects the assumption that the historical volatility over a period similar to the life

of the share options is indicative of future trends, which may not necessarily be the actual outcome.

At 31 December 2025, the range of exercise prices on options outstanding were between £2.27 to £3.00

(2024: £2.27 to £3.00) with remaining weighted average contractual life of 1.4 years (2024: 1.5 years).

The weighted average market price on exercise during the year was £3.69 (2024: £3.50).

There has been no change in the effective exercise price of any outstanding options during the year.

Employee benefit trusts

The Group sponsors employee benefit trusts (EBTs) to acquire and hold shares in Haleon plc to satisfy

awards made under employee share plans. The trustees of the EBTs purchase shares with finance provided

by the Group by way of gifts or loans or alternatively the Group transfers treasury shares to the EBTs to

satisfy obligations towards employees. The costs of running the EBTs are charged to the income statement.

Shares held by the EBTs are deducted from other reserves and amortised down to the value of proceeds,

if any, receivable from other subsidiaries on exercise by a transfer to retained earnings. The trustees have

waived their rights to dividends on the shares held by the EBTs. At 31 December 2025, the EBTs held 1.3m

shares (2024: 0.6m shares, 2023: 10.4m shares) with a market value of £5m (2024: £2m, 2023: £34m).

27. Acquisitions and disposals

Business combinations where common control exists at the time of the transaction are accounted for by

adopting the principles of predecessor accounting. All assets and liabilities acquired are recognised at

their previous carrying values with effect from the beginning of the earliest period reported in the financial

statements. No new goodwill arises from such transactions and the differences between the fair value of

the consideration paid and the carrying value of assets and liabilities acquired is recorded within equity in

the merger reserve.

Business combinations where common control does not exist before the transaction are accounted for

using the acquisition accounting method. Identifiable assets, liabilities and contingent liabilities acquired

are measured at fair value at acquisition date. The consideration transferred is measured at fair value and

includes the fair value of any contingent consideration. Where the consideration transferred, together with

the non-controlling interest, exceeds the fair value of the net assets, liabilities and contingent liabilities

acquired, the excess is recorded as goodwill, denominated in the currency of the operation acquired.

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

163

The costs related to business combinations are charged to the income statement in the period in which

they are incurred. Where not all the equity of a subsidiary is acquired, the non-controlling interest is

recognised either at fair value or at the non-controlling interest’s share of the net assets of the subsidiary,

on a case-by-case basis.

Disposal groups are generally measured at the lower of their carrying value or fair value less costs to sell.

Any gain or loss resulting from the disposal is recognised in the consolidated income statement.

Transactions with non-controlling interests are accounted for within equity. Where the Group has issued

a put option over shares held by a non-controlling interest, the Group derecognises the non-controlling

interests and instead recognises a financial liability for the amount likely to be paid to the non-controlling

interest on the exercise of those options. Movements in the estimated liability in respect of put options are

recognised in retained earnings.

Acquisitions

In China, the Group’s OTC business (which represents c.40% of Haleon’s total China business) is conducted

through a subsidiary. The subsidiary Tianjin TSKF Pharmaceutical Co., Ltd. (TSKF) was a joint venture

between Haleon, the Tianjin Pharmaceutical Group (TPG) and Tianjin Pharmaceutical Da Ren Tang Group

Corporation Limited (DRTG).

On 27 December 2024, Haleon completed the purchase of 33% of the equity interest in TSKF from the

partners, TPG and DRTG for a total consideration of RMB 4,465 million (£486 million). The transactions

were recognised in retained earnings. Haleon also signed an amended Joint Venture Agreement with

DRTG which gave the Group an option to buy the remaining 12% of TSKF. The Group recognised a financial

liability of £177m as the option value. The option value was determined based on the same equity value

used for the 33% equity interest purchase. As a result, because the Haleon option over the shares to be

purchased gave Haleon present access to returns over these shares held by DRTG, the non-controlling

interest presented in equity for the 12% was derecognised.

On 27 June 2025, Haleon completed the purchase of the remaining 12% equity interest in TSKF from the

partner, DRTG for a total consideration of RMB 1,623 million (£0.2 billion). Prior to this transaction, the

Group already had control over TSKF and therefore it was consolidated but post this transaction, TSKF is

a wholly owned subsidiary of the Group.

Disposals

During the year ended 31 December 2025, there were no new disposals by the Group, however, the Group

recognised a further £12m gain in relation to the sale of the Nicotine Replacement Therapy (NRT) business

which took place in 2024.

On 30 September 2024, the Group completed the sale of the NRT business outside the US to Dr Reddy’s

Laboratories SA for a total consideration of £485m (with additional proceeds from the transfer of

inventory). This comprises an upfront payment of £458m and a deferred, performance-based consideration

with an estimated fair value of £27m as of 30 September 2024. The Group recognised a £121m gain on

disposal in 2024, net of deal costs. In addition, the Group previously incurred £10m of deal costs in 2023.

On 31 May 2024, the Group completed the disposal of the rights in the ChapStick brand to Suave Brands

Company, a portfolio company of Yellow Wood Partners, for a cash consideration of £324m ($410m), as

well as a passive minority interest valued at £80m in the Suave Brands Company. No pre-tax loss or gain

was recognised on the disposal.

28. Post balance sheet events

On 8 January 2026, the Group announced that it is evolving its operating model in support of its Win as

One strategy to drive its growth, productivity and culture agenda. These changes are expected to be

implemented by mid-2026. As a result of our new operating model, we will update our segmental

disclosures. It is impractical to provide a reliable quantitative estimate of the impact to the disclosures

at this stage; an update will be provided in our half year reporting.

The implementation of the operating model is expected to result in annualised gross cost savings of

c.£175m-200m over the next two years, with a third of the savings delivered in 2026 and the remainder in

2027. We expect to incur one-time costs similar to the annualised gross savings with a higher proportion of

costs weighted towards 2026.

On 25 February 2026, the Board proposed a final dividend of 4.9p per ordinary share for a total amount of

approximately £439m. Subject to shareholder approval at the Company’s AGM, this dividend will be paid

on 14 May 2026 to holders of ordinary shares and ADSs on the register as of 10 April 2026. The dividend

will be paid out of retained profits.

29. Subsidiaries

Accounting policy

A subsidiary is an entity directly or indirectly controlled by the Company. Control is achieved where the

Company has existing rights that give it the current ability to direct the activities that affect the Company’s

returns and exposure or rights to variable returns from the entity.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated income

statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring their

accounting policies in line with those used by the Group. All intra-group transactions, balances, income

and expenses are eliminated on consolidation. Non-controlling interests in the net assets of consolidated

subsidiaries are identified separately from the Group’s equity therein. Non-controlling interests consist of

the amount of those interests at the date of the original acquisition and the non-controlling shareholder’s

share of changes in equity since the date of the acquisition. Total comprehensive income is attributed to

non-controlling interests even if this results in the non-controlling interests having a deficit balance.

No subsidiaries are excluded from the Group consolidation.

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

164

List of subsidiaries

A full list of the Company’s subsidiaries (as defined in the Large and Medium-sized Companies and Groups

(Accounts and Reports) Regulations 2008) as at 31 December 2025 is detailed below:


	Effective %
Company name	ownership Security		Registered address
Wholly owned subsidiaries
Altogether Services, Inc.	100%	Common	c/o United Corporate Services Inc., 10
			Bank Street, Suite 560, White Plains NY
			10606, United States
Consumer Healthcare Holdings	100%	Ordinary	Building 5, First Floor, The Heights,
Limited 2			Weybridge, Surrey, KT13 0NY, England
Consumer Healthcare Intermediate	100%	Ordinary	Building 5, First Floor, The Heights,
Holdings Limited 2			Weybridge, Surrey, KT13 0NY, England
Duncan Consumer Healthcare	100%	Common	23rd Floor, The Finance Centre, 26th
Philippines Inc.			Street Corner 9th Avenue, Bonifacio
			Global City, Taguig City, 1634,
			Philippines
Ferrosan ApS	100%	A Shares,	Delta Park 37, 2665, Vallensbæk Strand,
		B shares	Denmark
GlaxoSmithKline Asia Private	100%	Equity	Patiala Road, Nabha 147201, Dist
Limited			Patiala, Punjab, India
GlaxoSmithKline Consumer	100%	Ordinary	Building 5, First Floor, The Heights,
Healthcare (UK) (No.1) Limited			Weybridge, Surrey, KT13 0NY, England
GlaxoSmithKline Consumer	100%	Charter	Floor 16, Metropolitan, 235 Dong Khoi,
Healthcare Vietnam Company		Capital	Ben Nghe Ward, District 1, Ho Chi Minh
Limited			City, Vietnam
GlaxoSmithKline Consumer Private	100%	Equity	Patiala Road, Nabha 147201, Dist
Limited			Patiala, Punjab, India
GlaxoSmithKline Paraguay S.A.	100%	Ordinary	Oficial Gilberto Aranda 333, Planta Alta
			casi Salvador del Mundo, Asuncion,
			Paraguay
GSK Consumer Healthcare Trinidad	100%	Ordinary	Trinidad & Tobago Limited Head Office,
and Tobago Limited			18 Chotoo Road Extension, Aranguez,
			San Juan, Trinidad and Tobago
Haleon Alcala, S.A.	100%	Ordinary	Ctra de Ajalvir Km 2.500, Alcala de
			Henares, 28806, Madrid, Spain
Haleon Arabia Limited	100%	Ordinary	603 Salamah Tower, 6th Floor, Madinah
			Road, Al-Salamah District, Jeddah
			21425, Saudi Arabia
Haleon Argentina S.A.	100%	Ordinary	Tucuman 1, 4th Floor, City of Buenos
			Aires, C1049AAA, Argentina
Haleon Australia Pty Ltd.	100%	Ordinary	Level 48, 8 Parramatta Square, 10 Darcy
			Street, Parramatta, Sydney NSW 2150,
			Australia


	Effective %
Company name	ownership Security		Registered address
Haleon Austria GmbH	100%	Ordinary	Schottenring 25, Wien, 1010
Haleon Bangladesh Limited	100%	Ordinary	K-248/1 Dewalibari, Konabari, Gazipur-
			1700, Bangladesh
Haleon Belgium N.V.	100%	Ordinary	Da Vincilaan 5, 1930 Zaventem, Belgium
Haleon Brasil Distribuidora Ltda.	100%	Quotas	Av das Americas, 3500, 4th floor, rooms
			407-420, Rio de Janeiro, RJ, 22621-
			000, Brazil
Haleon Canada ULC / Haleon	100%	A Class	1133 Melville Street, Suite 3500, The
Canada SRI		Preference,	Stack, Vancouver BC V6E 4E5, Canada
		Common
Haleon CH Holding SARL	100%	Ordinary	Route de l’Etraz, 1197 Prangins,
			Switzerland
Haleon (China) Co., Ltd.	100%	Registered	Room 506, No.1 Shen’gang Boulevard,
		Capital	Lin-gang Special Area of China Pilot
			Free Trade Zone, Shanghai, 200000,
			China
Haleon CH Israel Ltd.	100%	Ordinary	25 Basel Street, Petech Tikva 49510,
			Israel
Haleon CH SARL 2	100%	Ordinary	Route de L’Etraz, 1197 Prangins,
			Switzerland
Haleon Chile SpA	100%	Interests	Av. Andrés Bello N°2687, 25th floor, Las
		Share	Condes, Chile
Haleon Colombia S.A.S.	100%	Ordinary	Carrera 7 No. 113-43 Piso 4, Colombia
Haleon Consumer Health	100%	Ordinary	13th Floor, Unit 13.06, Wave Place
(Thailand) Limited			Building, 55 Wireless Road, Lumpini
			Sub-district, Pathumwan District,
			Bangkok, 10330, Thailand
Haleon Consumer Healthcare	100%	Ordinary,	Boulevard Adolfo Ruiz Cortines No.
Mexico, Sociedad de		Ordinary	3720, Torre 3 Piso 11, Colonia Jardines
Responsabilidad Limitada de		Variable	del Pedregal, Alcaldía Alvaro Obregón,
Capital Variable			Ciudad de México, C.P. 01900, Mexico
Haleon Costa Rica S.A.	100%	Ordinary	Oficentro Terracampus, Edificio, Uno,
			Quinto Piso, Autopista Florencio del
			Castillo, kilometro siete, Cartago, La
			Unión San Diego, Costa Rica, 30302
Haleon Czech Republic s.r.o.	100%	Ordinary	Hvezdova 1734/2c, Prague, 4 140 00,
			Czech Republic
Haleon Denmark Aps	100%	Ordinary	Delta Park 37, 2665, Vallensbæk Strand,
			Denmark
Haleon EG General Trading LLC	100%	Quotas	North 90th street, Boomerang Building,
			5th District, Cairo, Egypt

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

165


	Effective %
Company name	ownership Security		Registered address
Haleon EG Limited	100%	Ordinary	North 90th street, Boomerang Building,
			5th District, Cairo, Egypt
Haleon Finland Oy	100%	Ordinary	Energiakuja 3, Helsinki, 00180, Finland
Haleon France	100%	Ordinary	23 rue François Jacob, 92500, Rueil-
			Malmaison, France
Haleon Germany GmbH	100%	Ordinary	Barthstr. 4, 80339, München, Germany
Haleon Hellas Single Member	100%	Ordinary	11 Kifisias Avenue, Athens, Attica, 151
Societe Anonyme			23, Greece
Haleon Holdings (No.2) LLC 2	100%	LLC	Corporation Service Company, 251 Little
		Interests	Falls Drive, Wilmington DE 19808,
			United States
Haleon Hong Kong Limited	100%	Ordinary	Unit 2810-2812, 28/F, Airside, 2
			Concorde Road, Kai Tak Hong Kong,
			China
Haleon Hungary Korlátolt	100%	Membership	H-1124, Csorsz utca 43, Budapest,
Felelosségu Társaság		Interests	Hungary
Haleon Insurance Limited	100%	Ordinary	Dorey Court, Admiral Park, St Peter Port,
			GY1 4AT, Guernsey
Haleon Intermediate Holdings	100%	Ordinary	Building 5, First Floor, The Heights,
Limited 1,2			Weybridge, Surrey, KT13 0NY, United
			Kingdom
Haleon Ireland Dungarvan Limited	100%	Ordinary	Knockbrack, Dungarvan, Co Waterford,
			X35 RY76, Ireland
Haleon Ireland Limited	100%	Ordinary	Clocherane, Youghal Road, Dungarvan,
			Waterford, Ireland, X35 Y983
Haleon Italy Manufacturing S.r.l.	100%	Quotas	90, Via Nettunese, 04011, Aprilia (Prov.
			di Latina), Italy
Haleon Italy S.r.l.	100%	Ordinary	Via Monte Rosa 91, Milano, Italy, 20149
Haleon Japan K.K.	100%	Ordinary	1-8-1 Akasaka Minato-ku, Tokyo, Japan
Haleon Kazakhstan Limited	100%	Charter	32 A Manasa Str., Bostandyk District,
Liability Partnership		Capital	Almaty, 050008, Kazakhstan
Haleon Kenya Limited	100%	Ordinary	Likoni Road, PO Box 78392, Nairobi,
			Kenya
Haleon Korea Co., Ltd.	100%	Ordinary	9F LS Yongsan Tower, 92 Hangang-
			daero, Yongsan-gu, Seoul, 04386,
			Republic of Korea
Haleon Lanka (Private) Limited	100%	Ordinary	World Trade Center, Level 34, West
			Tower, Echelon Square, Colombo 1, Sri
			Lanka
Haleon Lanka Enterprises Limited	100%	Ordinary,	121 Galle Road, Kaldemulla, Moratuwa,
		Ordinary B	Sri Lanka


	Effective %
Company name	ownership Security		Registered address
Haleon Levice, s.r.o.	100%	Ordinary	Priemyselny Park Gena, Ul. E. Sachsa 4-
			6, 934 01, Levice, Slovakia
Haleon Malaysia Sdn. Bhd.	100%	Ordinary	Lot 89, Jalan Enggang, Ampang/Hulu
			Kelang Industrial Estate, Selangor Darul
			Ehsan, 68000 Ampang, Malaysia
Haleon Netherlands B.V.	100%	Ordinary	Van Asch van Wijckstraat 55G, 3811 LP,
			Amersfoort, Netherlands
Haleon Netherlands Capital B.V.	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, United
			Kingdom
Haleon New Zealand ULC	100%	Ordinary	Level 1, 1.04, 12 Madden Street,
			Auckland, 1010,
			New Zealand
Haleon Norway AS	100%	Ordinary	Lysaker Torg 5, 3rd floor, Lysaker, 1366,
			Norway
Haleon Panama S.A.	100%	Ordinary	Urbanizacion Industrial Juan D, Calles A
			Y B, Republic of Panama, Panama
Haleon Panama Sociedad de	100%	Participation	Urbanizacion Industrial Juan D, Calles A
Responsabilidad Limitada		Interests	Y B, Republic of Panama, Panama
Haleon Peru S.R.L	100%	Ordinary	Av Jorge Basadre 349, piso 5, San
			Isidro, Lima, 05W-109, Peru
Haleon Philippines, Inc.	100%	Common	23rd Floor, The Finance Centre, 26th
			Street Corner 9th Avenue, Bonifacio
			Global City, Taguig City, 1634,
			Philippines
Haleon Poland sp. z.o.o.	100%	Ordinary	Rzymowskiego 53, 02-697, Warszawa,
			Poland
Haleon Portugal, Lda.	100%	Ordinary	Empreendimento Alfrapark, Estrada de
		Quota	Alfragide, ng 67, Ediffcio C, Pisa 2,
			Amadora, Portugal, 2610-008
Haleon Romania SRL	100%	Ordi nary	1-5 Costache Negri Street, Opera
			Center One, 6th floor (Zone 2), District
			5, Bucharest, Romania
Haleon (Shanghai) Health	100%	Registered	Unit 03, 25th floor, No. 90 Qirong Road,
Management Consulting Co., Ltd.		Capital	Pilot Free Trade Zone, Shanghai, China
Haleon (Suzhou) Pharmaceutical	100%	Registered	4 Baodai West Road, Suzhou, Jiangsu
Co., Ltd.		Capital	Province, 215128, China
Haleon (Suzhou) Technology Co.,	100%	Registered	Second floor of the Administrative
Ltd.		Capital	Building, No. 669, Gangpu, Guoxiang
			Street, Wuzhong Economic
			Development Zone, Suzhou, China

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

166


	Effective %
Company name	ownership Security		Registered address
Haleon Schweiz AG	100%	Ordinary	Suurstoffi 14, 6343, Rotkreuz,
			Switzerland
Haleon Singapore Pte. Ltd.	100%	Ordinary	23, Rochester Park #03-02, Singapore,
			139234, Singapore
Haleon Slovakia s. r. o.	100%	Ownership	Galvaniho 7/A, Bratislava, 821 04,
		Interests	Slovakia
Haleon South Africa (Pty) Ltd.	100%	Ordinary	17 Muswell Road South, Block D -
			Wedgefield Phase 2, Bryanston,
			Gauteng, 2191, South Africa
Haleon South Africa No 2 (Pty) Ltd.	100%	Common	Flushing Meadows Building, The
			Campus, 57 Sloane Street, Bryanston
			2021, South Africa
Haleon Spain, S.A.	100%	Ordinary	Paseo de la Castellana, 259D, planta 32,
			Madrid, Spain, 28046
Haleon Sweden AB	100%	Ordinary	Gävlegatan 16, 113 30, Stockholm,
			Sweden
Haleon (Taizhou) Technology Co.,	100%	Registered	Room 718 in Building D, Phase II of
Ltd.		Capital	New Drug Innovation Base, Taizhou,
			Jiangsu Province, 225300, China
Haleon Tuketici Sagligi Anonim	100%	Nominative	Esentepe Mah. Bahar Sk. Özdilek River
Sirketi			Plaza, Vyndham Grand No: 13 İç Kapı
			No: 80 Şişli, Istanbul, Turkey
Haleon UK Capital plc	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Corporate Director	100%	Ordinary	Building 5, First Floor, The Heights,
Limited			Weybridge, Surrey, KT13 0NY, England
Haleon UK Corporate Secretary	100%	Ordinary	Building 5, First Floor, The Heights,
Limited			Weybridge, Surrey, KT13 0NY, England
Haleon UK Enterprises Limited 2	100%	Voting	Building 5, First Floor, The Heights,
		shares	Weybridge, Surrey, KT13 0NY, England
Haleon UK Export Limited	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, United
			Kingdom
Haleon UK Finance (USD) Limited	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Finance Limited	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Holding Canada Limited	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Holding New Zealand	100%	Ordinary	Building 5, First Floor, The Heights,
Limited			Weybridge, Surrey, KT13 0NY, England


	Effective %
Company name	ownership Security		Registered address
Haleon UK Holding Sri Lanka	100%	Ordinary	Building 5, First Floor, The Heights,
Limited			Weybridge, Surrey, KT13 0NY, England
Haleon UK Holdings (No.1)	100%	Non-voting	Building 5, First Floor, The Heights,
Limited 2		Preference	Weybridge, Surrey, KT13 0NY, England
		Shares,
		Ordinary
Haleon UK Holdings (No.2)	100%	A Shares, B	Building 5, First Floor, The Heights,
Limited 2		Shares,	Weybridge, Surrey, KT13 0NY, England
		Preference
		Shares,
		Deferred
		Shares
Haleon UK Holdings (No.3) Limited	100%	Non-voting	Building 5, First Floor, The Heights,
		Preference	Weybridge, Surrey, KT13 0NY, England
		Shares,
		Ordinary
Haleon UK Holdings (No.7)	100%	Ordinary	Building 5, First Floor, The Heights,
Limited 2			Weybridge, Surrey, KT13 0NY, England
Haleon UK Holdings Limited 2	100%	A Shares, B	Building 5, First Floor, The Heights,
		Shares, C	Weybridge, Surrey, KT13 0NY, England
		Shares
Haleon UK IP (No.2) Limited 2	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, United
			Kingdom
Haleon UK IP Limited 2	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Research Limited	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Services Limited 2	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Trading Limited 2	100%	Ordinary	Building 5, First Floor, The Heights,
			Weybridge, Surrey, KT13 0NY, England
Haleon UK Trading Services	100%	Ordinary	Building 5, First Floor, The Heights,
Limited 2			Weybridge, Surrey, KT13 0NY, United
			Kingdom
Haleon US Capital LLC 2	100%	LLC	Corporation Service Company, 251 Little
		Interests	Falls Drive, Wilmington DE 19808,
			United States
Haleon US Holdings Inc.	100%	Preferred,	Corporation Service Company, 251 Little
		Common	Falls Drive, Wilmington DE 19808,
			United States

Strategic

Corporate

Consolidated

Parent Company

Other

Report

Governance

Financial Statements

Information

Haleon

Annual Report and Form 20-F 2025

167


	Effective %
Company name	ownership Security		Registered address
Haleon US Holdings LLC 2	100%	LLC	Corporation Service Company, 251 Little
		Interests	Falls Drive, Wilmington DE 19808,
			United States
Haleon US Inc.	100%	Common	Corporation Service Company, 251 Little
			Falls Drive, Wilmington DE 19808,
			United States
Haleon US IP LLC	100%	LLC	Corporation Service Company, 251 Little
		Interests	Falls Drive, Wilmington DE 19808,
			United States
Haleon US LLC	100%	LLC	Corporation Service Company, 2595
		Interests	Interstate Drive Suite 103, Harrisburg
			PA 17110, United States
Haleon US Services Inc.	100%	Common	Corporation Service Company, 251 Little
			Falls Drive, Wilmington DE 19808,
			United States
Iodosan S.p.A.	100%	Ordinary	Via Monte Rosa 91, Milano, Italy, 20149
JSC Haleon Rus	100%	Ordinary	Premises III, Room 9, floor 6,
			Presnenskaya nab. 10, 123112, Moscow,
			Russian Federation
Limited Liability Company “Haleon	100%	Ownership	Pavla Tychyny avenue, 1-V, Kiev, 02152,
Ukraine”		Interests	Ukraine
N.C.H. - Nutrition Consumer Health Ltd	100%	Ordinary	14 Hamephalsim St, Petach Tikva, Israel
Panadol GmbH	100%	Ordinary	Barthstr. 4, 80339, München, Germany
PF Consumer Healthcare B.V.	100%	Class A,	Van Asch van Wijckstraat 55G, 3811 LP
		Class B	Amersfoort, Netherlands
PF Consumer Healthcare Brazil	100%	Quota	Barueri, at Avenida Ceci, No.1900, Block
Importadora e Distribuidora de			III, Part 67, Tambore District, Sao Paulo,
Medicamentos Ltda			06460, Brazil
PF Consumer Healthcare Canada	100%	Common	1133 Melville Street, Suite, 3500, The
ULC / PF Soins De Sante SRI			Stack, Vancouver BC V6E 4E5, Canada
PF Consumer Healthcare Holding	100%	Ordinary	Van Asch van Wijckstraat 55G, 3811 LP
B.V.			Amersfoort, Netherlands
PF Consumer Taiwan LLC	100%	Interests	The Corporation Trust Company,
			Corporation Trust Center, 1209 Orange
			Street, Wilmington DE 19801, United
			States
Pfizer PFE Colombia S.A.S	100%	Common	Carrera 7 No. 113 - 43 Piso 4, Colombia
PT Haleon Indonesia Trading	100%	Ordinary	Pondok Indah Office Tower 5 Level 12,
			Suite 1201, Jalan Sultan Iskandar Muda
			Kav. V-TA, Pondok Pinang, Jakarta
			Selatan 12310, Indonesia


	Effective %
Company name	ownership Security		Registered address
PT Sterling Products Indonesia	100%	A Shares, B	Pondok Indah Office Tower 5 Level 12,
		Shares	Suite 1201, Jalan Sultan Iskandar Muda
			Kav. V-TA, Pondok Pinang, Jakarta
			Selatan 12310, Indonesia
PT. Bina Dentalindo 3	100%	Ordinary	Gedung Graha Ganesha Lantai 3, Jl
			Raya Bekasi Km 17, No5, Jakarta Timur
			13930, Indonesia
Stafford-Miller (Ireland) Limited 2	100%	Ordinary	Clocherane, Youghal Road, Dungarvan,
			Waterford, Ireland, X35 Y983
Sterling Drug (Malaya) Sdn Berhad	100%	Ordinary	Lot 89, Jalan Enggang, Ampang / Hulu
			Kelang Industrial Estate, Selangor Darul
			Ehsan, 68000 Ampang, Malaysia
Sterling Products International,	100%	Common	Corporation Service Company, 251 Little
Incorporated			Falls Drive, Wilmington DE 19808,
			United States
Treerly Health Co., Ltd.	100%	Registered	Unit 01A, Room 3901, No 16. East
		Capital	Zhujiang Road, Tianhe District,
			Guangzhou City, China
Tianjin TSKF Pharmaceutical Co.,	100%	Ordinary	Cheng Lin Zhuang Industrial Zone,
Ltd 2			Dong Li District, Tianjin, 300163, China

Notes to the Consolidated Financial Statements

continued

Haleon

Annual Report and Form 20-F 2025

168

Subsidiaries where the effective interest is less than 100%


	Effective %
Company name	ownership	Security	Registered address
Haleon-Gebro Consumer Healthcare	50.0%	Ordinary	Bahnhofbichl 13, 6391 Fieberbrunn,
GmbH			Kitzbühel, Austria
Haleon Pakistan Limited	85.8%	Ordinary	11-A, 11th Floor, Sky Tower (East Wing),
			Dolmen City, HC-3, Block 4, Scheme-5,
			Clifton, Karachi, Sindh 75600, Pakistan
Haleon US Enterprises Inc.	88.0%	Common	Corporation Service Company, 251 Little
			Falls Drive, Wilmington DE 19808, United
			States
Haleon US LP	88.0%	Partnership	Corporation Service Company, 251 Little
		Interests	Falls Drive, Wilmington DE 19808, United
			States
Haleon Taiwan Consumer Health	55.0%	Ordinary	24F, No. 66, Sec 1, Zhong Xiao W. Rd,
Corporation			Taipei 100, Taiwan

Directly held by Haleon plc.

Principal subsidiary of the Group as at 31 December 2025.

The company is in liquidation.

The following UK subsidiaries will take advantage of the audit exemption set out within Section 479A

of the Companies Act 2006, supported by guarantees issued by Haleon plc (under section 479C of the

Companies Act 2006) over their liabilities for the year ended 31 December 2025. Unless otherwise stated,

the undertakings listed below are owned, either directly or indirectly, by the Company.


Name	Company number
Consumer Healthcare Holdings Limited	11986432
Consumer Healthcare Intermediate Holdings Limited	11986416
GlaxoSmithKline Consumer Healthcare (UK) (No.1) Limited	00753340
Haleon UK Holding Canada Limited	12342809
Haleon UK Holding New Zealand Limited	12342879
Haleon UK Holding Sri Lanka Limited	09400298
Haleon UK Holdings (No.1) Limited	13355627
Haleon UK Holdings (No.3) Limited	13401293
Haleon UK Holdings (No.7) Limited	13414769

The following UK subsidiaries, having not traded during the year, will take advantage of the audit

exemption set out within Section 480 of the Companies Act 2006 for the year ended 31 December 2025.

Unless otherwise stated, the undertakings listed below are owned, either directly or indirectly, by

the Company.


Name	Company number
Haleon UK Corporate Director Limited	13401336
Haleon UK Corporate Secretary Limited	13434151

Haleon plc – Parent Company balance sheet

as at 31 December


		2025	2024
	Notes	£m	£m
Fixed assets
Investments	5	22,361	22,336
Current assets
Debtors: amounts falling due within one year	6	1,559	1,504
Cash and cash equivalents		1	–
Total current assets		1,560	1,504
Creditors: amounts falling due within one year	7	(1)	(2)
Net current assets		1,559	1,502
Total assets less current liabilities		23,920	23,838
Creditors: amounts falling due after one year	8	(25)	(25)
Net assets		23,895	23,813
Capital and reserves
Share capital	9	90	91
Other reserves	10	29	46
Retained earnings 1	11	23,776	23,676
Shareholders' equity		23,895	23,813

. The profit for the year was £1,261m (2024: £2,374m).

The notes on pages 171 to 174 form part of these Parent Company Financial Statements.

The Parent Company Financial Statements on pages 169 to 174 were approved by the Board of Directors and signed on its behalf by:

Dawn Allen

Chief Financial Officer

13 March 2026

169

Haleon

Annual Report and Form 20-F 2025

Consolidated

Financial Statements

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Haleon plc – Parent Company statement of changes in equity

for the year ended


		Share	Other
		capital	reserves	Retained earnings	Total
	Notes	£m	£m	£m	£m
At 1 January 2025		91	46	23,676	23,813
Profit after tax	11	–	–	1,261	1,261
Dividends to equity shareholders		–	–	(612)	(612)
Share-based incentive plans		–	86	–	86
Shares transferred to employees and employees of subsidiaries		–	108	(107)	1
Charge from parent for employee vested shares		–	(61)	61	–
Purchase of treasury shares		–	(151)	–	(151)
Repurchase of ordinary shares and capital reduction		(1)	1	(503)	(503)
At 31 December 2025		90	29	23,776	23,895


		Share	Other
		capital	reserves	Retained earnings	Total
	Notes	£m	£m	£m	£ m
At 1 January 2024		92	72	22,383	22,547
Profit after tax	11	–	–	2,374	2,374
Dividends to equity shareholders		–	–	(570)	(570)
Share-based incentive plans		–	102	–	102
Shares transferred to employees and employees of subsidiaries		–	6	(23)	(17)
Purchase of shares by employee benefit trust		–	(5)	–	(5)
Charge from parent for employee vested shares		–	(15)	15	–
Purchase of treasury shares		–	(116)	–	(116)
Repurchase of ordinary shares and capital reduction		(1)	2	(503)	(502)
At 31 December 2024		91	46	23,676	23,813

The notes on pages 171 to 174 form part of these Parent Company Financial Statements.

170

Haleon

Annual Report and Form 20-F 2025

1. Presentation of the Financial Statements

Description of business

Haleon plc and its subsidiary undertakings (collectively, the Group) is a group of companies focused on

developing and marketing a range of Oral Health, Vitamins, Minerals and Supplements (VMS), Pain Relief,

Respiratory Health, Digestive Health, and Therapeutic Skin Health & Other products in more than 100

countries.

The principal activity of the Company is to act as the parent holding company of the Group.

The Company is a public company limited by shares and is incorporated and domiciled in England with

registered number 13691224. The address of the Company’s registered office is Building 5, First Floor,

The Heights, Weybridge, Surrey, England, KT13 0NY.

Basis of preparation

The Parent Company Financial Statements, which are prepared using the historical cost convention and on

a going concern basis, are prepared in accordance with Financial Reporting Standard 102 ‘The Financial

Reporting Standard applicable in the UK and Republic of Ireland’ and the Companies Act 2006.

The Parent Company Financial Statements are presented in Pound Sterling (GBP, £), the functional currency

of the Company, and all values are denominated in millions of GBP (£m or £ million) unless stated

otherwise.

As permitted by Section 408 of the Companies Act 2006, the income statement of the Company is not

presented in this Annual Report.

In these Parent Company Financial Statements, the Company is considered to be a qualifying entity

(for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the

following disclosures:

–

The requirements of Section 7 Statement of Cash Flows.

–

The requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).

–

The requirements of Section 33 Related Party Disclosures.

–

The requirements of Section 11 Financial Instruments.

–

The requirements of Section 12 Other Financial Instruments.

–

The requirements of Section 28 to disclose information about Key Management Personnel

compensation.

–

The requirements of Section 26 Share Based Payments.

–

The requirements to Section 29 to disclose effect of International tax reform – Pillar Two model rules.

Where required, equivalent disclosures are given in the Consolidated Financial Statements of the Group.

Going concern basis

The Company operates as the investment holding company for the Group, holding investments in

subsidiaries financed by Group companies and occasionally acting as financial guarantor of certain

subsidiaries of the Group. As the Company is an intrinsic part of the Group’s structure and considering the

likelihood of the guarantees being called upon, the Directors have a reasonable expectation that Group

companies will continue to support the Company through trading and cash generated from trading for the

foreseeable future.

Accounting principles and policies

The preparation of the balance sheet in conformity with generally accepted accounting principles requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and disclosure of contingent assets and liabilities at the date of the balance sheet. Actual amounts could

differ from those estimates.

The balance sheet has been prepared in accordance with the Company’s accounting policies approved

by the Board and described in Note 2.

Key accounting judgements and estimates

There are no key judgements or significant estimates.

2. Accounting policies

The accounting policies below have been applied throughout the Parent Company Financial Statements

and apply to the Parent Company Financial Statements as a whole.

Foreign currency transactions

Foreign currency transactions are recorded at the exchange rate ruling on the date of transaction. Foreign

currency assets and liabilities are translated at rates of exchange ruling at the balance sheet date.

Operating income and expenditure

Income and expenditure are recognised in respect of services provided or received when supplied in

accordance with contractual terms. An accrual is made when an obligation exists for a future liability in

respect of a past event and where the amount of the obligation can be reliably estimated.

Interest receivable and interest payable

Interest receivable and similar income includes interest receivable on intercompany loans. Interest payable

and similar charges includes interest payable on intercompany loans. Interest receivable and interest

payable are recognised in profit or loss as they accrue, using the effective interest rate method.

Dividends

Dividends received are included in the profit and loss account in the year in which the right to receive the

payment is established. Final dividends are recorded in the reserves upon shareholder approval. Interim

dividends are deducted from reserves when they are paid. Dividends in the statement of changes in equity

are recognised at their fair value at the date of receipt.

Notes to the Parent Company Financial statements

171

Haleon

Annual Report and Form 20-F 2025

Consolidated

Financial Statements

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

Taxation

Current tax is provided at the amounts expected to be paid or refunded applying tax rates that have been

enacted or substantively enacted by the balance sheet date. This takes into account taxation deferred due

to timing differences between the treatment of certain items for taxation and accounting purposes.

Deferred tax is provided in full, using the liability method, in respect of all timing differences that have

originated but not reversed at the balance sheet date, where transactions or events that result in an

obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the balance

sheet date. Deferred tax assets are only recognised to the extent that they are considered recoverable

against future taxable profits and from which the future reversal of underlying timing differences can

be deducted.

Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the

timing differences are expected to reverse. Deferred tax liabilities and assets are not discounted.

The Company has applied the exception under the FRS 102 amendment for recognising and disclosing

information about deferred tax assets and liabilities related to Pillar Two income taxes.

Investments in subsidiaries

Investments in subsidiaries are held at cost less accumulated impairment losses.

The carrying values of investments are reviewed for impairment at least once a year or more frequently

when there is an indication that the investment might be impaired. The primary method used to assess

if the investment is impaired is to evaluate against the Group’s valuation on the basis of overall market

capitalisation. Another assessment method used is to compare the carrying value of each investment

against its share of the net assets value of the investment or against its share of the valuation of the

subsidiary based on expected discounted cash flows. Any impairment charge is recognised in the income

statement in the year concerned.

Share-based payments

Incentives in the form of equity-settled share-based payments are provided to certain employees which

are measured at fair value (excluding the effect of non-market based vesting conditions) at the date of

grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed

on a straight-line basis over the vesting period, based on the Company’s estimate of the shares that will

eventually vest, adjusted for the effect of non-market based vesting conditions.

Incentives in the form of shares provided by the Company to employees of its subsidiaries represents

additional capital contributions. An addition to the Company’s investment in subsidiary undertakings is

reported with a corresponding increase in shareholders’ equity. Refer to Note 26 to the Consolidated

Financial Statements for details of the charge.

The Company sponsors employee benefit trusts (EBTs) to acquire and hold shares in Haleon plc to satisfy

awards made under employee share plans. Shares in the Company acquired by the trusts are deducted

from equity until shares are vested, cancelled, reissued or disposed.

Financial assets and liabilities

Financial assets and liabilities are recognised on the Company’s balance sheet when the Company

becomes a party to the contractual provisions of the instrument and derecognised when it ceases to be

party to such provisions. Financial liabilities are classified as current if they are legally due to be paid within

12 months of the balance sheet date.

Financial assets and liabilities are initially measured at fair value and are subsequently reported at

amortised cost.

Receivables are recognised initially at fair value, and subsequently at amortised cost using the effective

interest rate method, less any expected credit losses.

Amounts owed to Group undertakings and other payables are recognised initially at the transaction price

and subsequently measured at amortised cost using the effective interest method. Non-interest bearing

payables are stated at their nominal value as they are due on demand.

Non-current liabilities are classified as financial liabilities in accordance with IFRS 9. They are recognised

initially at the transaction price and subsequently measured at amortised cost using the effective

interest method.

Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, current balances with banks and similar institutions and

highly liquid investments with maturities of three months or less. They are readily convertible into known

amounts of cash and have an insignificant risk of changes in value.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or

other resources received or receivable, net of the direct costs of issuing the equity instruments.

Repurchase and cancellation of ordinary shares

When the Company repurchases its ordinary shares as part of a share buyback programme, the amount of

the consideration paid, including directly attributable costs, is deducted from equity. Repurchased shares

are either cancelled immediately or held in Treasury in order to satisfy employee incentives. In order to

maintain capital, an equivalent amount to the nominal value of the shares cancelled is transferred to the

capital redemption reserve.

3. Auditor's remuneration

Fees payable to the Company’s auditor for the audit of the Company and Consolidated Financial

Statements are disclosed in Note 6 to the Consolidated Financial Statements.

Notes to the Parent Company Financial statements

continued

172

Haleon

Annual Report and Form 20-F 2025

4. Employees

The Company has employees to provide management services to subsidiary undertakings. Below is the

summary of the employee costs:

Employee costs

2025

£m

2024

£m

Wages and salaries

1.4

2.3

Social security costs

0.2

0.3

Severance

0.2

–

Pension and other post-employment costs

0.4

0.6

Share-based payments

0.8

0.7

Total

3.0

3.9

The average monthly number of persons employed by the Company during the year

2025

2024

Finance

Total

5. Investments

Subsidiary

undertakings

£m

Cost

At 1 January 2024

22,266

Share-based payments to employees of subsidiaries

101

Recharged to subsidiaries during the year

(15)

Shares transferred to employees of subsidiaries

(16)

At 31 December 2024

22,336

Share-based payments to employees of subsidiaries

Recharged to subsidiaries during the year

(61)

At 31 December 2025

22,361

Impairment

At 1 January 2024

–

At 31 December 2024

–

Impairment

–

At 31 December 2025

–

Net book value

At 1 January 2024

22,266

At 31 December 2024

22,336

At 31 December 2025

22,361

Details of the subsidiary undertakings of the Company as at 31 December 2025 are given in Note 29 to the

Consolidated Financial Statements.

6. Debtors: amounts falling due within one year

2025

£m

2024

£m

Amounts owed by Group undertakings

1,551

1,483

Other prepayments and accrued income

Corporation tax

Other receivables

–

Total

1,559

1,504

Amounts owed by Group undertakings are unsecured, interest free and repayable on demand except for a

call account balance of £1,549m (2024: £1,481m) which is unsecured and repayable on demand with

interest received at SONIA rate less 0.05%.

7. Creditors: amounts falling due within one year

2025

£m

2024

£m

Amounts owed to Group undertakings

–

(1)

Other payables and accruals

(1)

Total

(1)

(2)

Amounts owed to Group undertakings are unsecured, interest free and repayable on demand.

8. Creditors: amounts falling due after more than one year

2025

£m

2024

£m

Other payables

(25)

Other payables relate to the 25,000,000 issued Non-Voting Preference Shares with a coupon rate of 9.5%

per annum. The non-voting preference shares are entitled to receive a quarterly dividend and can only be

redeemed after five consecutive calendar years commencing on the date of issue, 17 July 2022, and hence

the Company has an unavoidable obligation to deliver cash. The Company has, therefore, classified the

non-voting preference shares as a financial liability.

9. Share capital

2025 Number

of shares

2025

£m

2024 Number

of shares

2024

£m

Issued and fully paid

Ordinary shares of £0.01 each

8,952,353,648

9,083,725,919

Total ordinary shares of £0.01 each

8,952,353,648

90 9,083,725,919

Movements in share capital are set out in Note 23 to the Consolidated Financial Statements.

173

Haleon

Annual Report and Form 20-F 2025

Consolidated

Financial Statements

Other

Information

Parent Company

Financial Statements

Corporate

Governance

Strategic

Report

10. Other reserves

The analysis of other reserves is as follows:

EBT shares

reserve

£m

Share-based

payment

reserve

£m

Treasury

reserve

£m

Capital

redemption

reserve

£m

Total

£m

As at 1 January 2024

(19)

–

Share-based incentive plans

–

102

–

102

Purchase of shares by employee benefit trust

(5)

–

(5)

Charge from parent for employee vested shares

–

(15)

–

(15)

Shares transferred to employees and employees

of subsidiaries

(16)

–

Purchase of treasury shares

–

(116)

–

(116)

Repurchase of ordinary shares and capital

reduction

–

As at 31 December 2024

(2)

162

(116)

Share-based incentive plans

–

Transfer of shares to the employee benefit trust

(111)

–

111

–

Charge from parent for employee vested shares

–

(61)

–

(61)

Shares transferred to employees and

employees of subsidiaries

108

–

108

Purchase of treasury shares

–

(151)

–

(151)

Repurchase of ordinary shares and capital

reduction

–

As at 31 December 2025

(5)

(156)

Shares owned through an employee benefit trust (EBT). The total number of shares held in connection

with employee share schemes as at 31 December 2025 was 0.7m (2024: 0.5m). Another 0.6m shares

were held through a trust by a Group company as at 31 December 2025 (2024: 0.1m).

11. Retained earnings

The profit of the Company for the year was £1,261m (2024: £2,374m).

The Company has £23,620m (2024: £23,560m) of reserves available for distribution.

12. Other guarantees and contingent liabilities

The total amount of guarantees is £8,505m (2024: £9,466m). This consists of guarantees relating to:

–

The bond issuances by Group companies Haleon US Capital LLC, Haleon UK Capital plc, and Haleon

Netherlands Capital B.V.

–

Loan facility agreement for other Group companies.

–

Renewable Energy Purchase Agreement for other Group companies.

–

International Swaps and Derivatives Association agreements for other Group companies.

–

Surety bonds for other Group companies.

Details are included in Note 19 to the Consolidated Financial Statements.

The Company has also provided a guarantee to certain UK subsidiaries to exempt them from audit under

Section 479A of the Companies Act 2006. The subsidiaries to which a guarantee has been issued for this

purpose are outlined in Note 29 to the Consolidated Financial Statements.

Details regarding certain legal actions which involve the Company are set out in Note 22 to the

Consolidated Financial Statements.

Notes to the Parent Company Financial statements

continued

174

Haleon

Annual Report and Form 20-F 2025

Directors’

Report

This Directors’ Report contains

information to be given in

accordance with the Companies

Act 2006. Relevant information

below, which is contained

elsewhere in this Annual Report,

is incorporated by cross

reference.

Group subsidiaries

As a Group that operates globally, Haleon’s

operations and activities are carried out

by subsidiaries, branches and scientific/

representative offices established under

the laws of many jurisdictions. A full list of

subsidiaries is provided at Note 29 of the

Consolidated Financial Statements from

page 163.

Directors’ powers

The Directors may exercise all the powers

of the Company, subject to the Articles

of Association (Articles), legislation and

regulation. This includes the ability, subject

to shareholder approval at Haleon’s AGM

each year, to exercise the authority to allot

or purchase the Company’s shares. Further

details of the powers of the Directors can be

found in the Articles of Association section

on page 191.

Conflicts of interest

Under the Articles and as permitted by the

Companies Act, the Board may authorise

any matter which would otherwise involve

a Director breaching their duty to avoid

conflicts of interest and may attach to any

such authorisation such conditions and/or

restrictions as the Board deems appropriate

(including in respect of the receipt of

information or restrictions on participation

at Board meetings). The Board has a formal

system for Directors to declare such situations

to be considered for authorisation by those

Directors who have no interest in the matter

being considered. Situations considered

by the Board and authorisations given are

recorded in the Board minutes and in a register

of conflicts maintained by the Company

Secretary and are reviewed annually by the

Board. The Board believes that this system

operates effectively.

Insurance and indemnities

The Company maintained directors’ and

officers’ liability insurance cover during the

period of this Annual Report. Each Director

also benefits from an indemnity provided by

the Company in respect of any proceedings

brought by third parties against them

personally in their capacity as Director.

Code of Conduct

Our Code of Conduct (Code) was updated in

2025 and applies to the Board and Executive

Team, employees and third-party temporary

workers and complies with the NYSE rules

as set out in Section 406 of SOX. Our Code

includes a prohibition on engaging in insider

trading or use of non-public information that

could manipulate the price of Haleon’s shares,

either to our own advantage or for another

person and also applies to any other company

with which we do business. Further details on

our Code are set out in the Strategic Report on

page 39, and the Board’s oversight of the Code

is set out on pages 66 and 72.

Haleon has also adopted an insider trading

policy governing the purchase, sale and/or

other disposition of our securities by our

Directors, officers and covered employees,

which we believe is reasonably designed to

promote compliance with applicable insider

trading laws, rules and regulations and

exchange listing standards.

As at 31 December 2025, the Company had

8,952,353,648 ordinary shares of £0.01 each

and 25,000,000 non-voting preference shares

of £1.00 each in issue. As at 31 December

2025, the Company had 45,745,646 ordinary

shares held as treasury shares. There are no

special control rights or restrictions on share

transfers or limitations on the holding of any

class of shares. Further information about the

Company’s ordinary shares and non-voting

preference shares can be found under Articles

of Association on page 191.

Authority to purchase shares

At its AGM held in May 2025, Haleon received

shareholder approval to make purchases of

its own ordinary shares on-market up to a

maximum number representing 10% of its

issued share capital. During the year, the

Company purchased a total of 175,806,525

ordinary shares of £0.01 each. The shares

repurchased in 2025 comprised 1.96% of

Haleon’s total issued share capital as at

31 December 2025. Further information on

each purchase is set out below. Resolutions

seeking shareholder authority for the purchase

of the Company’s shares will be put to

shareholders at the AGM to be held on

29 April 2026.

The Company utilised the authority obtained

at its 2025 AGM to undertake an on-market

share buyback programme which was

announced to the market on 28 March 2025.

The first tranche of the buyback programme

commenced on 28 March 2025 for an

aggregate consideration of approximately

£200m and concluded on 26 June 2025

with Haleon re-purchasing c.51m shares.

The purpose of the first tranche of the

buyback programme was to reduce the

Company's share capital.

On 31 July 2025, we announced the

commencement of the second tranche of

the buyback programme for an aggregate

consideration of approximately £280m.

This was made up of approximately £130m

to complete the remainder of the £500m

allocated to share buybacks in 2025, with a

purpose of reducing the Company's share

capital, and a further c.£150m for the

purposes of satisfying Haleon's obligations

under its existing employee share plans

in 2026 and 2027. The second tranche of

the buyback programme concluded on

1 October 2025 with Haleon re-purchasing

c.80.6m shares.

The Company also used the authority

obtained at its 2024 AGM on 21 March 2025

to make an off-market purchase of 44,155,844

shares from Pfizer, at a price per share of £3.85

and a total consideration of approximately

£170m. The purpose of the off-market

purchase was to reduce the Company's share

capital. For further details of the terms of

the off-market buyback contract with Pfizer,

please see Haleon’s Notice of 2024 AGM

available on Haleon’s website.

Dividends and dividend policy

On 25 February 2026, the Board proposed a

final dividend of 4.9p per ordinary share which

will be paid, subject to shareholder approval,

following the Company’s 2026 AGM. The

Company paid an interim dividend of 2.2p per

ordinary share on 18 September 2025 in

respect of its 2025 half-year results.

Haleon has a dividend policy that looks

to balance all its stakeholders’ interests

while ensuring the long-term success of the

Company. Subject to market conditions and

Board approval, Haleon expects to grow

its ordinary dividend at least in line with

adjusted earnings. Future ordinary dividends

are expected to be paid half-yearly with

approximately one third of the dividend

paid as an interim dividend, following the

Company’s half-year results, and the balance

paid as a final dividend, subject to shareholder

approval, following the Company’s AGM.

Dividends are announced in Pound Sterling,

with an equivalent US Dollar amount paid in

respect of the Company’s ADSs.

Other

Information

175

Haleon

Annual Report and Form 20-F 2025

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Strategic

Report

Directors’ Report

continued

The Trustees of the Haleon employee benefit

trusts, which are independent of the Company,

waived the right to dividends paid during

the year.

Under the Company’s ADS programme, the

right to dividends in relation to the ordinary

shares underlying the ADSs was waived during

the year, under an arrangement whereby the

Company pays the monies to satisfy any

dividends separately to the Depositary for

distribution to ADS holders entitled to the

dividend. This arrangement is expected to

continue for future dividends.

See Note 19 to the Consolidated Financial

Statements on page 145 for information

on dividends paid on non-voting preference

shares and Note 10 on page 136 for

information on dividends paid on

ordinary shares.

Financial risk management

The Group’s financial risk management

objectives and policies, including its use of

financial instruments, are set out in Note 25

to the Consolidated Financial Statements

from page 153.

Future business developments of the

Group

Details are set out in the Strategic Report from

page 2.

Our Code is available at

www.haleon.com/

who-we-are/Governance/codes-policies-and-

standards

Share plan details

2025 share awards and grants to employees

Our current policy is to settle the majority of

awards or grants under the Company’s share

plans with shares held in treasury or

purchased in the market, however, the

Company continues to review this policy.

The Company’s share plans incorporate the

Investment Association’s current guidelines

on dilution. During the year, the Company

satisfied its obligations under its share plans

solely via treasury shares which were

purchased as part of an on-market buyback.

As at 31 December 2025, there were 6,077,095

options outstanding, solely in respect of the

Company’s HMRC-approved all-employee

Sharesave Plan.

Employee Benefit Trusts (EBTs)

The Group operates EBTs for the benefit

of employees and former employees. The

Company settles share awards under its

Performance Share Plan, Share Value Plan and

Sharesave Plan, by the transfer of treasury

shares to its employee share trusts. In certain

cases, the EBTs may purchase ordinary shares

or ADSs in the market and release them to

current and former employees in satisfaction

of share awards. During 2025, the EBTs

released 17,467,507 ordinary shares and

5,320,852 ADSs. At 31 December 2025,

the EBTs held 737,404 ordinary shares and

282,504 ADSs in the Company. The EBTs adopt

a prudent approach to purchasing shares,

using funds provided or loaned to them by the

Group, based on expectations of future

requirements.

Shares or ADSs that have not been allocated

to share plan participants are held by the EBTs

and although the trustee has the right to vote

or abstain from exercising their voting rights in

relation to those shares, it has a policy of not

voting, which is in line with guidelines. The

trustee also has the right to accept or reject

any offer relating to the shares or ADSs in any

way it sees fit. Dividend waivers are in place in

respect of unallocated shares and ADSs held

in the EBTs.

Significant shareholders

following persons have disclosed an

interest in the issued ordinary share capital

of the Company in accordance with the

requirements of rules 5.1.2 or 5.1.5 of the FCA’s

Disclosure Guidance and Transparency Rules.

The Company’s major shareholders have the

same voting rights as other shareholders. The

Company does not know of any arrangements

the operation of which may result in a change

in its control. Other than as set out below,

no changes to major shareholdings were

disclosed to the Company between

31 December 2025 and 5 March 2026.

On 21 March 2025, Pfizer ceased to be a

shareholder of the Company, having previously

held 32% following demerger.

Number of ordinary shares

disclosed as a percentage of

the Company’s issued share

capital at:

Shareholder

Date of latest disclosure

to the Company

Number of

ordinary shares

disclosed

Date of latest

disclosure to

the Company

31 December

2025

BlackRock, Inc.

16 January 2025

484,900,413

5.22%

Pfizer, Inc.

21 March 2025

Wellington Management Group LLP

24 September 2025

444,957,354

4.98%

Pfizer, Inc. reduced their stake to nil during the reporting period.

The Companies (Miscellaneous Reporting)

Regulations 2018

Employee engagement

The below statement relates to our employees

as defined in the glossary and should be read

in conjunction with our stakeholder and

people disclosures in the Strategic Report

on pages 31 to 39, respectively, Section 172

statement on page 31, and workforce

engagement disclosures on page 69, and

other engagement disclosures in the Directors’

Remuneration Report from page 78.

During 2025, the key forms of engagement

to provide information to our employees

included a fortnightly global email ‘Connecting

Haleon’, intranet global news page, CEO-led

global broadcasts, fireside chats on priority

topics, internal social media channels,

dedicated senior manager calls, as well as

regional leadership calls and direct emails,

videos and business function team meetings.

Employees have been consulted and given

opportunities to express their views and

concerns through participation in the twice-

yearly employee engagement surveys, team

meetings, townhalls, ERGs, and Q&As at

global broadcasts and fireside chats. They

have been made aware of the financial and

economic factors affecting the performance

of the Company through quarterly, global

broadcasts and emails from the CEO, internal

social media updates, as well as functional

and regional team meetings. The Chair and

Directors have engaged with employees

through direct interactions, ‘employee

listening sessions’ with our Workforce

Engagement Director and other opportunities

held during the year to meet Executive

Directors via video meetings or in person.

Engagement with suppliers, customers

and others in a business relationship

with Haleon

Our business relationships with our suppliers,

customers and others are fundamental to our

success. During the year, the Board considered

matters related to them and had regard to the

176

Haleon

Annual Report and Form 20-F 2025

impact of decisions on them as detailed in the

Section 172 statement on page 31. The Board

monitors relationships through a mixture of

presentations, reports and direct engagement.

Details of how relationships have been

maintained throughout the year are set out

in the stakeholder engagement section on

pages 32 to 34.

Employment of disabled persons

Our commitment is to ensure our workforce

has the backgrounds, experiences and skills to

serve our consumers and the communities in

which we operate. We are striving to create an

inclusive environment in which everyone can

contribute and feel a sense of belonging, feel

understood and valued, treated fairly and

equally, and supported to progress and thrive.

We want our employees to be able to be their

authentic selves and, as a result, perform at

their best. All employees must ensure an

equitable and inclusive culture free of

discrimination and encourage respectful and

inclusive behaviour. Every effort is made to

ensure that applications for employment from

disabled people are fully and fairly considered

and that disabled employees have equal

opportunities for training, career development

and promotion.

Political donations

The Group does not make political

contributions or sponsor political meetings,

conferences, conventions or events, as set out

in our Anti-Bribery and Corruption (ABAC)

Policy. In the year to 31 December 2025, the

Group did not make any political contributions

or provide any sponsorship.

In accordance with the Federal Election

Campaign Act in the US, Haleon employees

are able to make personal contributions to our

US Political Action Committee (PAC). A PAC is a

corporate or labour-based political committee

that collects voluntary contributions from

eligible US employees into a separate fund.

In donating to the PAC, participating eligible

employees are exercising their legal right to

pool their resources and make political

contributions, which are subject to strict

limitations under US law. The fund is managed

by a board of directors of participating

employees from Haleon’s US operating

company and makes contributions or

expenditures in connection with Federal and

State elections. The PAC is not controlled by

Haleon. The operations of the Haleon PAC are

reviewed regularly to ensure compliance with

applicable US laws. Disclosure reports for the

Haleon PAC can be viewed at www.fec.gov.

In 2025, a total of $49,500 was donated to

political organisations by the Haleon PAC.

English law requires prior shareholder

approval for political contributions to political

parties and independent election candidates

as well as for any political expenditure. The

definitions of political donations, political

expenditure and political organisations used

in the legislation are, however, quite broad.

As a result, the definitions may cover

legitimate business activities not in the

ordinary sense considered to be political

donations or political expenditure, nor are

they designed to support any political party

or independent election candidate.

Therefore, notwithstanding our policy, and

while we do not intend to make donations

to any political parties or organisations, nor

to incur any political expenditure, we will

annually seek shareholder authorisation

for any inadvertent expenditure as a

precautionary measure to ensure that the

Company and its subsidiaries do not

inadvertently breach the legislation.

Significant agreements and change of

control provisions

The Group is a party to certain arrangements

which could be terminated upon a change of

control of the Company (and/or the Group’s

UK, Dutch and US debt-issuing entities) and

which are considered significant in terms of

their potential impact on the business of

the Group as a whole. These arrangements

include each series of notes issued under the

Company’s EMTN programme and the USD

note programme.

The notes contain a redemption or purchase

upon change of control provision which, if

triggered, allows note holders to exercise their

option to require the UK and US debt-issuing

entities to redeem, or at such issuers’ options,

to purchase, the notes and pay any accrued

and unpaid interest due.

Further information on the notes issued and

outstanding under the programmes as at

31 December 2025 is available in Note 19 to

the Consolidated Financial Statements from

page 144.

In addition, during the reporting period

the Company was a party to the Pfizer

Relationship Agreement, the principal

purpose of which was to regulate the

continuing relationship between the

Company and Pfizer, Inc., which was a

controlling shareholder of the Company

following demerger until 21 March 2024.

The Relationship Agreement terminated

automatically in accordance with its terms on

17 January 2025, when Pfizer ceased to hold

at least 10% of Haleon’s ordinary shares.

Throughout the period under review, the

Company has complied with provisions

and obligations in the Pfizer Relationship

Agreement and, as far as the Company is

aware, Pfizer has also complied.

Streamlined Energy and Carbon Reporting

(SECR)

In line with the requirements set out in the

UK Government’s guidance on SECR, the table

on page 178 represents Haleon’s energy

use and associated carbon emissions from

electricity and fuel in the UK and the rest

of the world (ROW), calculated with

reference to the Greenhouse Gas Protocol:

A Corporate Accounting and Reporting

Standard. In our 2025 reporting period, the UK

accounted for 3% of our global total energy

use as well as 2% of our Scope 1 and 2

emissions (location-based). The closure of

our Maidenhead (UK) site at the end of 2025,

as announced in 2024, impacts the GHG

emissions and energy figures for the UK in

2025 as production volumes ramped down

at the site and transferred to other sites

outside the UK. This is expected to have

a bigger impact in 2026 as the site is no

longer operating.

Energy efficiency action taken

We achieved 100% renewable electricity at

sites within our operational control in 2022

and have since maintained this, including in

2025, by utilising a combination of onsite solar,

power purchase agreements and renewable

energy certificates (RECs).

In 2025, we invested more than £12m in

energy efficiency and carbon reduction

projects and continued to focus our efforts

on Scope 1 and 2 carbon emissions’ reduction

in line with our 2030 goal. Progress includes

installing electric steam generators at our

Kuala Lumpur, Malaysia site and a second at

our Nairobi, Kenya site. We also installed new

heat pumps at our two Suzhou, China sites.

These projects all support our ambition to

significantly reduce carbon emissions from

energy generation for heating and cooling at

these manufacturing sites.

See also our

approach to health inclusivity

and sustainability

section from page 15.

See our Prevention of Bribery, Corruption and

Other Financial Crimes Policy at

www.haleon.

com/who-we-are/Governance/codes-

policies-and-standards

See our position on political advocacy at

www.haleon.com/who-we-are/our-policy-

positions

Other

Information

177

Haleon

Annual Report and Form 20-F 2025

Parent Company

Financial Statements

Consolidated

Financial Statements

Corporate

Governance

Strategic

Report

Going concern

Information on the business environment

in which the Company operates (page 8),

its market categories (pages 9 to 14), and the

2025 finance review (pages 42 to 49), including

the factors underpinning the industry’s future

growth prospects, are included in the

Strategic Report.

The Directors believe that it is appropriate to

adopt the going concern basis of accounting in

preparing the Group’s Consolidated Financial

Statements. Further detail as to the Directors’

assessment is set out in Note 1 to the

Consolidated Financial Statements on

page 127.

An overview of the business activities of

Haleon, including a review of the principal

business risks that the Group faces, is given

in the Strategic Report on pages 50 to 56

and in Group information from page 181.

The scenarios considered and assessment

made by the Directors with respect to the

Company’s risk factors and viability are set

out on page 58.

Directors’ Report

In addition to the information set out herein,

this Directors’ Report incorporates by

reference the following sections of this

Annual Report:

— Strategic Report from page 1, including R&D

and innovation from page 6.

— Corporate Governance from page 60.

— Statement of Directors’ responsibilities,

including Disclosure of information to

auditors on page 105.

— Group information from page 179, including

Articles of Association and Material

contracts on pages 191 and 192.

— Note 24 to the Consolidated Financial

Statements (Related-party transactions)

from page 152.

— Note 28 to the Consolidated Financial

Statements (Post balance sheet events)

from page 163.

— Shareholder information from page 193.

The only matters to report in respect of UK

Listing Rule 6.6.1 are in relation to dividends

(set out on page 175), material contracts (set

out on page 192), waiver of fees by the Pfizer

nominated Non-Executive Director (set out on

page 100) and agreements with controlling

shareholders (set out on pages 175, 176 and

from page 177).

By order of the Board

Amanda Mellor

Company Secretary

Haleon plc

Registered in England and Wales,

Company number 13691224

13 March 2026

Directors’ Report

continued

Carbon emissions from our operations

2025

2024

ROW

Total

Global

ROW

Total

Global

Total Scope 1 GHG emissions

(thousands of tonnes

e, including onsite fuel use, fleet mileage and

refrigerant losses)

57*

Total Scope 2 GHG emissions

(location-based)

(thousands of tonnes CO

123

125*

121

124

Total Scope 2 GHG emissions

(market-based)

(thousands of tonnes CO

Total Scope 1 & 2 GHG emissions

(location-based)

(thousands of tonnes CO

178

182*

187

192

Total Scope 1 & 2 GHG emissions

(market-based)

(thousands of tonnes CO

63*

Total GHG emissions offset

(thousands of

tonnes CO

20*

Total net Scope 1 & 2 carbon emissions

(market-based)

(thousands of tonnes CO

43*

Total energy consumed

in our operations (GWh)

645

668*

693

719

Total renewable energy consumed

(GWh)

353

365*

344

359

Total renewable electricity consumed

(GWh)

315

328*

310

325

Renewable electricity

(%)

100%

100%*

100%

Renewable energy

(%)

53%

55%

55%*

58%

50%

Intensity Ratio

GHG emissions intensity

(location-based)

(tonnes of CO

e per £m revenue)

16*

Carbon emissions from our value chain

Total Scope 3 carbon emissions

(thousands of

tonnes CO

2,463

2,533

For further information on our reporting criteria please see Haleon’s 2025 Health Inclusivity

and Sustainability Basis of Reporting and the Health Inclusivity and Sustainability Report.

KPMG LLP’s limited assurance conclusion and Haleon’s reporting criteria are available at

www.haleon.com/our-impact/esg-reporting-hub

KPMG LLP has issued independent limited assurance over the selected data indicated using assurance standards ISAE (UK)

3000 and ISAE 3410.

For the 2025 and 2024 reporting periods we have used data from 1 December (in the prior year) to 30 November (in the year

stated). The exception to this is for total Scope 3 emissions where the 2025 and 2024 reporting periods cover the period

1 July (in the prior year) to 30 June (in the year stated). The 2024 Scope 3 estimated result differs from the values in the 2024

Annual Report and Form 20-F due to methodology and data improvements, including updated emission factors and granular

data for products made at third-party manufacturers. While the change in the total Scope 3 result is not material, the change

in split of emissions across the GHG protocol

categories is material. The restated Scope 3 GHG results better reflect the

drivers of our footprint and where we are focusing our actions to reduce Scope 3 emissions.

GHG emissions are expressed in carbon dioxide equivalents (CO

e) reflecting the effective amount of CO

generated by all

gas emissions which add to the greenhouse effect and global warming. Carbon emissions have been calculated according to

the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (updated with Scope 2 guidance). For further

information on the methodologies used to calculate our emissions and energy metrics, please see our Health Inclusivity and

Sustainability Basis of Reporting. Scope of reporting is sites over which Haleon has full operational control.

This calculation takes the total emissions offset in the reporting period into account.

Carbon emissions intensity is derived from the ratio of the total Scope 1 and 2 GHG emissions (location-based) (tCO

e) from

all sites where we have full operational control to the total revenue in the same reporting period.

178

Haleon

Annual Report and Form 20-F 2025

Group

information

History and development of the Group

Haleon is the result of the combination of

three consumer health businesses over the

last decade. The focus of the business has

been sharpened through divestment of

growth-dilutive brands and those outside of

our core categories. In addition, the scientific

and consumer products’ experience of its

legacy businesses has been enhanced by

investment in commercial and scientific

capabilities, technologies and facilities,

most notably in the digital sphere.

On 18 July 2022, Haleon demerged from

GSK creating a company with management,

infrastructure, capital allocation and incentives

focused specifically on consumer health.

The Group has a strong and established

presence in all key channels relevant for

consumer healthcare and a scale which allows

it to effectively engage with retail partners of

all sizes, buying groups, distributors, pharmacy

chains and individual pharmacies.

Prior to demerger, the Group had transformed

since 2012 through progressive strategic M&A

and divestments to create a world leader in

consumer health.

The Group’s scale greatly expanded through

the successful combination of the legacy GSK

consumer healthcare business with the

Novartis consumer healthcare business in

2015, and the subsequent combination of this

business with the Pfizer consumer healthcare

business in 2019. In addition, the Group’s

focus has been sharpened since 2012 through

the progressive divestment of GSK’s

nutritionals businesses and the divestment

by the Group of non-strategic OTC brands,

including its programme of divestments of

non-strategic and growth-dilutive brands

(with aggregate net proceeds from divested

brands of £1.1bn) during the period from 2019

to 2021. This deliberate strategy has resulted

in a portfolio more focused on higher-growth

categories, markets and channels. These

transactions also provided a catalyst for

a broader transformation of the Group.

Prior to its combination with the Novartis

consumer healthcare business in 2015, GSK’s

consumer healthcare business was already

one of the world’s leading OTC and Oral

Health companies with a long heritage in

consumer health products dating back to

the 18th century. The Group sold a range

of leading OTC brands across Respiratory

Health, Pain Relief, Digestive Health, Skin

Health and Smokers’ Health, together with

a strong portfolio of Oral Health brands.

Geographically, the GSK consumer healthcare

business had a strong presence in higher-

growth emerging markets in the Middle East,

Africa and Asia, which complemented its

businesses in Europe and North America.

On 2 March 2015, GSK and Novartis formed a

consumer healthcare joint venture to combine

the majority of GSK’s consumer healthcare

business and all of Novartis’ OTC business.

Novartis’ business provided GSK with a

meaningful incremental presence in OTC.

The combination added a leading portfolio

of globally recognised consumer-preferred

and expert-recommended brands in the

Pain Relief, Respiratory Health, Smokers’

Health and Skin Health categories to the

Group’s business.

In June 2018, GSK acquired Novartis’

shareholding in the GSK/Novartis JV for

$13bn, enabling GSK to take full operational

and strategic control of the business.

On 31 July 2019, GSK completed a transaction

with Pfizer to combine substantially all of GSK

and Pfizer’s respective consumer healthcare

businesses into a new world-leading

consumer healthcare joint venture (the Pfizer

Transaction). The transaction, which was

transformational to the scale of the Group’s

business, brought together two businesses

with highly complementary geographic

footprints and brand portfolios.

While the Group retained its strong European

footprint, completion of the transaction also

provided the Group with incremental

geographical scale in the US, where it became

the leader in OTC/VMS, and in China, where it

became the leading OTC/VMS multinational.

From a portfolio perspective, the transaction

provided the Group with global leadership in

the higher-growth VMS market as well as a

leading presence in the US Pain Relief market

complementing the Group’s existing Pain Relief

portfolio. Since completion of the Pfizer

Transaction and prior to demerger, GSK owned

68% of the ordinary shares in the entity

2022

2024

2025

2019–2021

Significant divestment programme:

Disposal of 50 non-strategic

growth-dilutive assets

2012

Exit of

non-strategic

OTC

2013

Divest

Exit of

beverages

2015

Joint Venture

Formation:

Novartis

Consumer

Healthcare

2018

Full buyout

of Novartis

from JV

2019

Joint Venture

Formation:

Pfizer Consumer

Healthcare

2020

Exit of

non-strategic

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