Unilever 1Q Turnover Rose; Warns of Cost Pressures -- Update

By Michael Susin

Unilever PLC said Thursday that first-quarter turnover and sales rose above market expectations despite higher costs, which it expects to normalize in 2023 and 2024.

The Anglo-Dutch multisector retailer--which owns consumer brands such as Ben & Jerry's ice cream, Dove soap and Cif and Domestos cleaning products--said turnover in the period rose 11.8% to 13.8 billion euros ($14.57 billion). This compares with a consensus forecast of EUR13.24 billion, taken from the company's website.

Underlying sales growth rose 7.3% on year driven by strong pricing. This compares with a company-provided consensus forecast of 4.4%.

Unilever said the underlying operating margin for 2022 is expected to be at the bottom end of the guided range of 16% to 17%, as it forecasts input cost inflation for the second half to be around EUR2.7 billion.

"We expect to restore margin through pricing, mix and savings delivery during 2023 and 2024, as market conditions normalize", it said.

The company said it will take further pricing action to face inflation headwinds, which is expected to affect sales volumes as a result.

"We now expect underlying sales growth in 2022 to be towards the top end of the previously guided range of 4.5% to 6.5%. We will ensure that we protect the health of our brands as we continue to invest competitively," Unilever said.

The board declared a quarterly dividend of EUR0.4268 a share, unchanged from the year-ago period.

Write to Michael Susin at [e-mail]

(END) Dow Jones Newswires

April 28, 2022 03:18 ET (07:18 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.