Unilever Ghana records 24% drop in 2019 third quarter revenues

GHANA – Consumer goods giant, Unilever Ghana Plc has reported weaker revenue in the third quarter of 2019 compared to same period last year.

According to the firm’s financial statements, revenue generated in 2019 quarter three went down to US$60.33 million (GH¢342.8 million) from US$78.91 million (GH¢448.4 million) realized during the same period in 2018.

The loss according to Unilever, represented a 24 percent decrease in its revenue compared to that of last year.

Attributing the reduction in revenues to weak sales in Ghana, the maker of Blue Band margarine, Royco, Knorr and Annapurna salt, said the results reflect challenging trading conditions as well as efforts to reduce high inventory levels in its distribution network.

The banking sector clean up by the Bank of Ghana has also been listed as a key factor in low sales at Unilever, the country’s largest producer and retailer of consumer goods.

JoyNews reported of an email where Unilever Ghana Limited disclosed, “many distributors finding it increasingly difficult trading.”

The email noted that the “economic climate in Ghana has seen a slow-down especially in trading conditions particularly after the banking sector reforms which began in Q4 2018.”

Board Chairman, Edward Effah, at the 45th annual general meeting of the company in Accra said that, revenue was expected to dip in 2019 in the absence of spreads business.

Effa however noted that the company was focused on improving sales as way of compensation for the fall.

Unilever Global, the parent company of Unilever Ghana, has also revealed that it won’t meet its sales growth target for 2019, and warned that weakness will continue into next year.

Unilever, blamed the weaker forecasts on an economic slowdown in South Asia, one of its largest markets, and difficult business conditions in West Africa and North America.

“The slowdown is particularly coming in rural India, which for the first time in a while is growing at a slower rate than urban India,” CEO Alan Jope told analysts.

The company with operations in more than 190 countries said that sales growth in the first half of 2020 is expected to be below 3% while the growth for the full year is expected to be in the “lower half” of the 3% to 5% range.

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