Unilever posts 5.4% sales growth in H1 2021
FMCG giant, Unilever has announced results for the first half of 2021, which show a strong performance, with underlying sales growth of 5.4% with 4.0% volume and 1.3% price.
Unilever CEO, Alan Jope announced: “Unilever has delivered a strong first half, with underlying sales growth of 5.4% driven by our continued focus on operational excellence.
Jope explained: “We are making good progress against the strategic choices outlined earlier this year, including the development of our portfolio into high growth spaces. Prestige Beauty and Functional Nutrition grew strongly, and we recently announced the acquisition of digitally native skin care brand Paula’s Choice. The operational separation of our Tea business is substantially complete. Our ecommerce business grew 50% and the channel now represents 11% of sales.”
The result shows that price growth stepped up in Q2 with an increased turnover at 0.3% including a positive impact of 1.4% from acquisitions net of disposals and negative impact of 6.1% from currency related items; underlying operating margin of 18.8%, a decrease of 100bps driven by investment behind our brands and input cost inflation; underlying earnings per share down 2.0%, including a negative impact of 6.3% from currency; free cash flow of €2.4 billion, compared to €2.9 billion in the first half of 2020; a quarterly shareholder dividend of €0.4268 per share and share buyback programme of up to €3 billion underway.
“Competitive growth is our priority,” the CEO continued, “and we are confident that we will deliver underlying sales growth in 2021 well within our multi-year framework of 3-5%, despite more challenging comparators in the second half. We have seen further cost inflation emerge through the second quarter. Cost volatility and the timing of landing price actions create a higher-than-normal range of likely year end margin outcomes. We are managing this dynamically and expect to maintain underlying operating margin for 2021 around flat.”
Beauty & Personal Care underlying sales grew 3.3% with 1.8% from volume and 1.4% from price, with an acceleration to 4.2% underlying sales growth in the second quarter, helped by increased personal care consumption occasions as living restrictions were eased in some of our markets.
Skin care grew double digit and deodorants returned to growth. In skin care, Vaseline and Ponds each grew double digit. Oral care grew mid-single digit, led by volume from South Asia and Africa. Home Care underlying sales grew 4.5% with 4.8% from volume and negative price of 0.3%.
Fabric cleaning grew mid-single digit driven by recovery in India and price-led growth in Brazil. Home & hygiene declined low single digit. There was good growth in dishwash in emerging markets, while household cleaners declined. Foods & Refreshment underlying sales grew 8.1% with 5.8% from volume and 2.1% from price.
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