Unilever: Half-year results show consistent growth led by emerging markets
Underlying sales grew 3.3% with volume 1.2% and price 2.1%
Today, Unilever announced its results for the first half of 2019, which show underlying sales growth of 3.3%, led by our emerging market business which grew 6.2%.
Today, Unilever announced its results for the first half of 2019: underlying sales grew 3.3% with volume 1.2% and price 2.1%. Emerging markets underlying sales growth 6.2% with volume 2.5% and price 3.6%. Turnover decreased 0.9% driven by the sale of our spreads business, partially offset by a 1.1% currency benefit. Underlying operating margin increased 50bps with 30bps from gross margin. Operating margin increased by 40bps. Underlying earnings per share increased 5.0%, with constant EPS up 3.0%. Commenting on the results, CEO Alan Jope says: “We have delivered consistent growth within our guided range for 2019, led by our emerging markets. Accelerating growth remains our top priority and we continue to evolve our portfolio and seek out fast growth channel and geographical opportunities, as well as address those performance hotspots where growth is falling short of our aspirations.
For the full year, we continue to expect underlying sales growth to be in the lower half of our multi-year 3-5% range, an improvement in underlying operating margin that keeps us on track for the 2020 target and another year of strong free cash flow. Our sustainable business model and portfolio of purpose-led brands are key to delivering superior long-term financial performance.” Underlying sales in our Food & Refreshment division grew 1.3%. In tea, sales declined with volumes impacted by weak consumer demand in developed markets. This was partially offset by black tea in emerging markets and our fruit, herbal and green tea ranges, including Pukka’s premium herbal offering. Sales in dressings were flat with volumes slightly down as competitive intensity remained high. Despite poorer weather in the second quarter compared to the previous two years, ice cream grew slightly over the half. We saw good ice cream performance in Asia/AMET/RUB and from innovations such as Magnum White Chocolate and Cookies. Savoury performance was helped by the launch of new snack pot variants meeting the trend towards convenience. The introduction of Hellmann’s Burger and Spicy Dipping sauces continue to broaden the brand beyond core mayonnaise, and Sir Kensington’s performed well.
Underlying operating margin in Foods & Refreshment decreased by 40bps, as a result of an adverse impact on overheads related to the disposal of our spreads business.
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