UK – Multinational consumer goods company, Unilever has raised its sales guidance for the full year after reporting underlying sales growth accelerated to 10.6% in the third quarter of 2022, led by an underlying pricing growth of 12.5%, one of the highest in the last few quarters.
The company’s nutrition business saw underlying sales growth of 11.8% with dressings having a very strong quarter supported by the continued growth momentum of Hellmann’s, particularly in the United States.
In addition, its in-home and out-of-home Ice Cream grew strongly by 13.2%, driven by double-digit price growth with Europe benefitting from a strong summer season, however, in-home showed a slight volume decline, reflecting high price growth in the Americas and some supply issues in the US.
The CPG noted that emerging markets grew 13.3% with a 14.9% contribution from price and volume at (1.4) %.
South Asia continued to grow strongly through both price and volume while price growth in Latin America increased to 23.2% with volumes contracting by 4.6%.
China returned to slightly positive growth, and sales growth in South-East Asia benefitted from lapping the prior year’s lockdown effect in some markets. Sales in the developed markets increased by 7.1%, with 9.3% from price and (2.0) % from volume.
North America’s revenue grew 8.3%, boosted by strong performances in Nutrition and Ice Cream and Europe delivered 5.4% growth, helped by double-digit growth in Ice Cream.
The group’s turnover increased by 17.8% to €15.8 billion, which included a currency impact of 8.8% and (2.1) % from disposals net of acquisitions.
According to Unilever, this increase reflects the sale of the global tea business, ekaterra, completed on 1 July 2022.
Alan Jope, Unilever’s global CEO, said: “We have delivered growth in each of our five Business Groups, led by a strong performance from our billion+ Euro brands, growing 14% in the quarter. Strong pricing allows us to continue to drive increased investment behind our brands.
“Our organization is now better structured to deliver consistent growth through a simpler, more category-focused operating model. The full benefits will be realized over time, and we are seeing encouraging early signs of improved accountability and faster decision-making.
“The global macroeconomic outlook remains mixed, and we expect the challenges of high inflation to persist in 2023. The delivery of consistent growth remains our priority.”
Meanwhile, Jope told media after announcing Unilever’s September quarter results that Hindustan Unilever’s (HUL) focus on operation and consistent marketing investment yielded the desired results, contributing around 11% of Unilever’s overall sales.
This growth, Jope said, was well supported by HUL’s premium portfolio and innovations at a time when inflation continued to impact demand in all the geographies in which the company sells its product.
In a quarter when Unilever Plc saw a 1.6% decline in sales volumes, its Indian subsidiary stood out with a 4% volume growth.
HUL’s market capitalization of US$71.87 billion is 63% of Unilever’s market cap of US$114.08 billion compared to 60% a year ago and just 22% five years ago.
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