Unilever Q1 Sales Down, Underlying Sales Up On Emerging Markets; Lifts Dividend

(RTTNews) - Consumer goods giant Unilever Plc. (UN, ULVR.L, UL) reported Thursday a decline in first-quarter sales, while underlying sales increased on improved volume and pricing in Emerging markets, including Latin America, which performed strongly in the quarter. The company also lifted its dividend.

For the first quarter, turnover declined 2 percent year-over-year to 12.5 billion euros, including a negative currency impact of 7.1 percent.

Unilever noted that consumer demand remained fragile and that volume growth slowed further in its markets, with market growth weak in emerging markets, negligible in North America and negative in Europe.

Underlying sales growth was 4.7 percent for the period. Underlying volume rose 2.6 percent, while pricing was up 2.0 percent.

The Group said its underlying sales growth in the first quarter was driven by market share gains across all four categories.

Emerging markets' sales grew 8.3 percent to 7.2 billion euros with an increased contribution from volume. There was strong underlying price growth in Latin America and virtually no price growth in Asia.

Developed markets, meanwhile, declined 0.3 percent to 5.3 billion euros, with volume growth offset by widespread price deflation in Europe.

On a geographical basis, Asia/AMET/RUB region recorded sales of 5.4 billion euros, a growth of 5 percent organically. The Americas' sales grew 8.5 percent to 4 billion euros with strong 17.9 percent growth in Latin America, driven by strong pricing, while North American sales edged up 0.1 percent. Europe sales declined 0.6 percent to 3.1 billion euros.

In the quarter, underlying sales in Personal Care grew 5.8 percent, driven by innovations that grow the core of brands and extend into more premium segments, and that of foods went up 1.9 percent.

Home Care sales grew 7 percent, well ahead of markets, and refreshment sales improved 3.8 percent.

CEO Paul Polman said, "The first quarter demonstrates a strong volume-driven performance, following on from a good delivery in 2015. We are maintaining momentum despite a tougher external environment, with all four categories gaining market share."

The Board of Unilever has declared a quarterly interim dividend for first quarter 2016 of 0.3201 euros per Unilever N.V. ordinary share and 0.2556 pence per Unilever PLC ordinary share. This represents an increase of 6 percent from last year.

Looking ahead, the company noted, with markets remaining volatile, its key programmes set out at the end of last year would help to deliver another year of volume-driven growth ahead of our markets, steady improvement in core operating margin and strong cash flow.

In London, Unilever shares are currently trading at 3,276.50 pence, up 0.40 percent, while it declined 0.17 percent in Amsterdam.