Unilever reports boost in sales for third quarter of 2018

Magnum Ben & Jerry'sFMCG giant Unilever has reported a boost in sales for the third quarter of 2018, with a 3.8 per cent lift generating €12.5 billion in revenue.

The multinational reported that its Foods and Refreshment division had an underlying sales growth of 3.2 per cent with its ice cream brands including the Kinder and Magnum Praline range delivering strong growth.

“Growth accelerated in the third quarter across all Divisions. We were able to increase prices while still maintaining good volume growth which reflects the strength of our brands and quality of our innovation programme. Our focus on building our business for the long-term continues to deliver high quality growth,” Unilever CEO Paul Polman said.

“We are progressively reaping the benefits of our Connected 4 Growth programme, which is now well embedded throughout the organisation, making us simpler, faster and better connected with our consumers. It is helping us accelerate growth in Asia AMET RUB, manage through the economic volatility in Latin America and shift our portfolio into faster growing segments and channels in all of our markets.”

Its snacking brands Red Red, Prepco and Mãe Terra performed well and Knorr created more organic and natural innovations including a new ‘soup in glass’ range. Sir Kensington’s performed well due to the launch of Del Huerto, a new three dressings brand in Colombia.

Unilever’s latest acquisitions of TAZO and Pukka and its organic Lipton range boosted sales, but its black tea range in developed markets continues to be challenging.

“Our innovation pipeline continues to strengthen and in the third quarter alone we have launched four new brands. We have now successfully completed the disposal of our spreads business and continue the acceleration of our efficiency programmes. We continue to expect underlying sales growth in the 3 – 5 per cent range, an improvement in underlying operating margin and strong cash flow. We remain on track for our 2020 goals,” added Polman.

 

Beauty and Personal Care improved with underlying sales growth of 4.0 per cent. Skin care has seen improvement due to innovations including Citra’s new naturals range and Pond’s new cleansing balm. Skin cleansing performed well boosted by premium products including the launch of foaming shower gels. In deodorants, the purpose-led campaigns on Dove Men+Care and Rexona helped the sales.

Dove had a good quarter driven by the roll-out of new naturals range and the launch of ‘super’ conditioners, which reduce hair damage in just one minute. In oral care, sales were slightly lower due to the challenging market conditions in France, Indonesia and Brazil.

“Growth in prestige accelerated with double-digit growth in Hourglass, Kate Somerville, Living Proof and REN. Love, Beauty and Planet, the largest of our new brand launches, was extended into deodorants and skin care this quarter and the new brand K-Bright was launched in South East Asia to address the fast-growing Korean beauty trend,” said Unilever in a statement.

The Home Care division had an underlying sales growth of 4.5 per cent boosted by stronger pricing and recovery from the truckers’ strike in Brazil. Home and hygiene performed well due to its Cif premium sprays and Sunlight.

Earlier this month the FMCG giant scrapped plans to move its headquarters from London to Rotterdam due to a lack of support from its shareholders. The consumer goods company plans to simplify its structure but is in discussions about how best to do this.

The company was also fined a total of €27 million by Greece’s competition authority for engaging in “anti-competitive vertical practices”. The Hellenic Competition Commission found that Unilever’s Greek business, Elais-Unilever Hellas, “adopted and implemented abusive practices” to strengthen and maintain its dominant position in the margarine market. By doing this the consumer goods giant excluded competitors and limited their growth possibilities.

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