Fifth Consecutive Quarter of Growth at Unilever
Food, personal care and home care group Unilever has delivered its fifth consecutive quarter of growth as its transformation strategy continues. Turnover in the first quarter increased by 7% to Eur10.9b as underlying sales rose by of 4.3% with all categories growing, driven by emerging markets up 9.9%. Underlying volume growth was 2.5% and pricing was up 1.8%.
Reflecting another good performance in the emerging markets, revenue in ice cream and beverages during the quarter was Eur1.94b with underlying sales growth of 4.7%. The Magnum brand is continuing to grow rapidly, fuelled by the launches in the US and Indonesia. Cornetto is also doing well, particularly in Asia with a strong performance in China.
Paul Polman, chief executive of Unilever.
Tea grew on the back of a strong performance in South Asia, good share gains in the UK and the early success of the Lipton pyramid Green and White teas in Western Europe and Russia. AdeS soy drinks continue to deliver rapid growth in Latin America supported by new flavours, packaging and communication.
Underlying sales in savoury, dressings and spreads rose by 2.1% to Eur3.38b as all the sub-categories delivered sales growth on the back of strong innovations and increasing price. Savoury growth was driven by Knorr jelly bouillon and Knorr baking bags, successfully launched in Brazil and growing well in Europe. The mild winter held back sales of soups in Europe whilst PF Chang’s restaurant quality frozen meals are doing well in the US.
Dressings grew through the successful campaign to inspire new uses of mayonnaise. Rising commodity costs, especially in spreads, required higher pricing which led to negative volumes in the quarter. However, Unilever has a strong programme of innovation, for example the launch of Flora Cuisine liquid margarine in the UK, with more to come as the quality and taste of the group’s products are improved.
“We have delivered a good performance which demonstrates that the transformation of Unilever is progressing well; this against a backdrop of rising commodity costs, weak consumer confidence and very competitive markets. All categories are growing, driven by a particularly strong performance in the emerging markets. We have continued to deliver volume growth, albeit at a lower rate than in recent quarters reflecting the pricing action taken and the sluggishness of the developed markets. Innovation continues to be the key driver of growth,” comments Paul Polman, chief executive of Unilever. “We continue to focus on the long term development of the business and our priorities remain: profitable volume growth ahead of our markets, steady and sustainable underlying operating margin improvement and strong cash flow.”
