Unilever Copes With Currency Woes -- WSJ

Consumer-goods group reports 2.3% drop in revenue on currency fluctuations

By Saabira Chaudhuri 

LONDON -- Unilever PLC reported a rise in underlying sales for the first quarter as it sold more products at higher prices, but headline results were weighed down by currency volatility.

The Anglo-Dutch consumer goods group, whose brands include Dove soap and Ben and Jerry's ice cream, reported a 2.3% fall in revenue to EUR12.5 billion ($14.3 billion) for the quarter ended March 31, down from EUR12.8 billion a year earlier.

Underlying sales -- which strip out foreign-exchange impacts -- grew 4.7%, meeting analyst estimates. Underlying sales in emerging markets increased 8.3% in the first quarter, up from the 5.4% growth Unilever reported a year earlier.

Unilever has been working to mitigate the impact of a turbulent macroeconomic environment by raising prices and releasing premium versions of its products. The company has also adopted so-called "zero-based budgeting" or justifying each year's expenses from scratch to rein in costs.

"With markets remaining volatile, we continue to focus on driving agility and resilience in our business," said Chief Executive Paul Polman on Thursday.

The results come as rival Nestlé SA reported a 3.9% rise in organic sales for the three months and confirmed its full-year outlook of organic growth in line with 2015.

Unilever reported a 5.8% rise in underlying sales at its personal-care arm, a business that has been a priority as Unilever shifts away from being a food-focused company into one that increasingly sells body wash and face cream.

The company reported 7% underlying growth in its home-care division and 3.8% in its refreshment business which includes ice cream and tea.

The foods business remained a relative laggard, growing by 1.9% as Unilever said sales in its spreads business continued to decline despite a new campaign in the U.K. highlighting the health credentials of its Flora margarine brand.

Unilever reported a 6% increase in its quarterly dividend to EUR0.32 a share.

--Rory Gallivan contributed to this article

Write to Saabira Chaudhuri at [e-mail]

(END) Dow Jones Newswires

April 15, 2016 02:48 ET (06:48 GMT)

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