FDBusiness.com

Unilever Shows Resilience

 Breaking News
  • Greene King Being Sold For £2.7 Billion CK Asset, which is one of the largest property developers in Hong Kong and an international investment group, has made a recommended £2.7 billion cash offer for Greene King, the UK’s leading integrated brewer and pub retailer operating over 2,700 pubs, restaurants and hotels across England, Wales and Scotland. Including debt, the enterprise value of [...]...
  • The Hershey Company Takes Minority Stake in Irish Snacking Brand The Hershey Company, the US-based food group, has made a minority investment in Fulfil Holdings, the owner of the snacking brand FULFIL. Headquartered in Dublin, Ireland, FULFIL has rapidly grown since its inception, now outselling many traditional chocolate snack bar brands in the UK and Ireland and named a top 50 consumer brand in Ireland. Brian [...]...
  • UK Restaurant Numbers Drop Again as Consumer Tastes Shift Britain’s restaurant numbers have fallen for the sixth quarter in a row, the new edition of the Market Growth Monitor from CGA and AlixPartners reveals. Independent operators have borne the brunt of the closures with group-owned restaurants proving more resilient despite some major brand failures. The quarterly survey of the country’s supply of licensed premises reports a 3.4% drop in [...]...
  • Molson Coors Commits to Reduce Plastics in Packaging Molson Coors in the UK and Ireland is removing the plastic packaging from its Carling and Coors Light brands, as part of new global packaging goals. The brewer will remove the plastic film wrap from large multipacks by the end of March 2020, replacing the plastic wrap with 100% recyclable fully enclosed carton board. By [...]...
  • Carlsberg Group Upgrades Full Year Operating Profit Outlook Carlsberg Group has delivered organic operating profit growth of 17.7% for the first half of 2019 with reported growth of 18.2% to DKr 5.17 billion (€693 million). Organic net revenue growth was 4.2% and on a reported basis net revenue rose by 6.5% to DKr32.99 (€4.42 billion). Operating margin improved by 160bp to 15.7%. Reported net [...]...

Unilever Shows Resilience

Unilever Shows Resilience
January 27
10:04 2017

Unilever increased operating profit by 3.8% to €7.8 billion and net profit by 5.5% to €5.5 billion in 2016 as turnover, due to a negative currency impact, declined by 1.0% to €52.7 billion. However, underlying sales grew 3.7%, with price up 2.8% and volume up 0.9%, as all four categories delivered good progress against their strategic priorities. Personal Care and Foods achieved improved growth while maintaining strong profitability and cash flow. Home Care and Refreshment improved margins while continuing to grow ahead of their markets.

Emerging markets grew 6.5% mainly driven by volume growth in Asia and price growth in Latin America. Developed markets declined by 0.2% with volume growth in North America offset by price deflation in Europe.

Gross margin improved by 50bps to 42.7% driven by margin-accretive innovations and acquisitions as well as savings programmes. Core operating margin at 15.3% was up 50bps and operating margin improved by 70bps to 14.8%. In local currencies, brand and marketing investment was sustained at the absolute level of the prior year and as a percentage of turnover was down by 40bps due to sales leverage and efficiencies from zero based budgeting.

Paul Polman, chief executive of Unilever.

Paul Polman, chief executive of Unilever, comments: “We have delivered another good all-round performance despite severe economic disruptions, particularly in India and Brazil, two of our largest markets. This further demonstrates the progress we have made in transforming Unilever into a more resilient business. We have again grown ahead of our markets, driven by strong innovations that support our category strategies.”

He continues: “Our priorities for 2017 continue to be volume growth ahead of our markets, a further increase in core operating margin and strong cash flow. The tough market conditions which made the end of the year particularly challenging are likely to continue in the first half of 2017. Against this background, we expect a slow start with growth improving as the year progresses.”

Unilever’s Foods category sustained its return to growth with good performances in dressings, driven by the squeezy packs with easy-out technology and organic variants, and savoury, led by cooking products in emerging markets. Hellmann’s and Knorr both delivered another year of strong growth by successfully modernising their ranges, with extensions into organic variants and with packaging that highlights the naturalness of their ingredients. Knorr’s digital campaign ‘Love at First Taste’ reached more than 100 million people. Sales in spreads declined, as modest growth in emerging markets was offset by the continued but slowing decline in developed markets. Food sales in 2016 were €12.5 billion with underlying sales growth of 2.1%. Core operating margin was 30bps lower due to higher overheads that included higher restructuring costs.

The Refreshment category achieved underlying sales growth of 3.5% to €10.0 billion and core operating margin was up 50bps primarily due to further improvements in the gross margin in ice cream. Growth in ice cream was driven by margin-accretive innovations behind Unilever’s premium brands. These included the Magnum Double range, the Ben & Jerry’s ‘Wich sandwich and dairy free range, as well as new variants of Talenti, the premium gelato brand which has grown 60% since acquisition two years ago. In leaf tea, growth improved in emerging markets but was held back by Unilever’s black tea business in developed markets. Unilever is continuing to build its presence in more premium segments with good growth from T2 and specialty teas. Unilever introduced Pure Leaf, already well-established in ready-to-drink tea, as a premium brand in our leaf tea portfolio in the US.

About Author

mike

mike

Related Articles

Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • September 11, 2019Packaging Innovations & Luxury Packaging London 2019
  • October 1, 2019PPMA Total Show
  • October 17, 2019Future Food-Tech
  • November 18, 2019Plastics Caps and Closures Conference 2019
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber

Subscribe Here



Advertisements