Unilever jumps on organic condiments maker
- Author: Wendy Palmer Apr 23, 2017,
Apr 23, 2017, 2:12
Unilever said first quarter revenue increased by 6.1% to €13.3bn including a foreign currency gain of 2.4%.
The results could boost investor enthusiasm for the maker of Dove soap and Knorr soups, whose shares have gained since February when it swiftly rejected a $143 billion takeover offer from rival Kraft Heinz, which prompted it to undertake a wide-ranging review of its business.
Unilever announced in a statement this morning that its underlying sales had increased by 2.9 percent in the first three months of the year. Pricing increased by 3 percent in the quarter, while volume fell 0.1 percent, both measures beating analyst estimates. In a bid to drum up $3 billion in sales over the next 10 years, the company is expanding distribution of its products in major cities, including in Sir Kensington's hometown of NY. In 2016, $18.64 billion of total sales of $26.487 billion were in the US and a further $2.3 billion were derived in Canada.
For the first quarter, turnover increased 6.1 percent from past year to 13.3 billion euros, including a positive currency impact of 2.4 percent.
Mark Schneider, Nestlé CEO: "Organic growth of 2.3% this quarter is within our full-year guidance range". Unilever has grappled with lower consumer prices in Europe and a slowdown in emerging markets such as China and India that account for about 60 percent of sales. It purchased a couple premium ice cream brands, including Talenti Gelato, and invested in its Ben & Jerry's and Hellmann's brands.
Excluding Unilever's under-pressure spreads business, which the company is looking to either sell or de-merge, underlying sales from the food division rose 1.7%, with volumes down 1%.
Commenting on this morning's trading update, Unilever chief executive Paul Polman said: "The first quarter shows growth once more ahead of our markets".
The group has raised its quarterly dividend by 12 per cent to €0.3585.
Mr Polman also said that he expects the company can boost its operating margins by 80 basis points this year as the business focuses on driving the efficiencies that Kraft Heinz said that it had identified whilst pursuing its takeover.