Unilever Q1 Sales Up On Emerging Markets; Says On Track For FY17 Sales Growth

(RTTNews) - Anglo-Dutch consumer goods company Unilever Plc (UN, ULVR.L, UL) reported Thursday higher sales in its first quarter, mainly with strong sales in emerging markets, despite weakness in North America and Europe. The company also lifted its quarterly dividend, and said it is on track for underlying sales growth in fiscal 2017.

For the first quarter, turnover increased 6.1 percent from last year to 13.3 billion euros, including a positive currency impact of 2.4 percent.

Underlying sales growth was 2.9 percent with price up 3 percent, while volume was down 0.1 percent.

Excluding spreads, underlying sales growth was 3.4 percent. As part of its strategic review, the company announced on April 6 its intention to either sell or demerge spreads business.

Refreshment, Home Care and Personal Care grew ahead of markets, while sales in Foods, impacted by the later Easter this year, were flat.

Underlying sales of Home Care and Personal Care increased 3.4 percent. Foods and Refreshment underlying sales increased 2.2 percent, despite weak volume.

In the quarter, the company noted that market conditions remained challenging. In the markets in which it operates, growth was around 2 percent with negative volumes.

Emerging markets underlying sales growth was 6.1 percent with price up 5.3 percent and volume up 0.8 percent. Latin American sales grew 3.5 percent. The company noted that growth in India recovered from the uncertainty experienced due to the removal of the Rs.500 and Rs.1,000 notes in November 2016, while Brazil continued to be adversely impacted by the economic crisis.

Meanwhile, developed markets' underlying sales growth dropped 1.5 percent. North American sales fell 0.9 percent. In Europe consumer demand remained weak and the retail environment challenging.

In Asia/AMET/RUB region, underlying sales growth improved to 6.9 percent. The Americas recorded 1.2 percent sales growth, while underlying sales in Europe fell 2 percent.

Further, the company said its Boards have determined to pay a quarterly interim dividend for first quarter of 0.3585 euros per Unilever N.V. ordinary share, and 0.3021 pounds per Unilever PLC ordinary share. The quarterly dividend has been raised by 12 percent.

Paul Polman, Chief Executive Officer, said, "The first quarter shows growth once more ahead of our markets. … The actions we are taking keep us on track for another year of underlying sales growth ahead of our markets, in the 3 - 5 percent range. We also expect an improvement in underlying operating margin this year of at least 80 basis points and strong cash flow."

In London, Unilever shares were trading at 3,983.50 pence, up 1.17 percent. In Amsterdam, the shares were gaining 1.24 percent to 48.14 euros.