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Grim sales at Unilever highlights slowdown | Grim sales at Unilever highlights slowdown |
(about 7 hours later) | |
The sluggish global economy was laid bare by Britain’s biggest consumer brands multinational yesterday as Unilever reported on weak sales in Europe, China, and across most emerging markets. | The sluggish global economy was laid bare by Britain’s biggest consumer brands multinational yesterday as Unilever reported on weak sales in Europe, China, and across most emerging markets. |
Of all the Marmite to Dove soap giant’s regions, only North America appeared to be improving in the third quarter sales update, and that was only from a low base. | Of all the Marmite to Dove soap giant’s regions, only North America appeared to be improving in the third quarter sales update, and that was only from a low base. |
Unilever’s chief executive Paul Polman said China was proving particuarly tough as retailers were running down their unsold stock and not re-ordering. | Unilever’s chief executive Paul Polman said China was proving particuarly tough as retailers were running down their unsold stock and not re-ordering. |
Turnover in the quarter was down 2 per cent to €12.2bn, hit by strength of the pound. | Turnover in the quarter was down 2 per cent to €12.2bn, hit by strength of the pound. |
Unilever’s experience painted a hands-on picture of the wobbly global economy that has been increasingly emerging from the official data, and which has been responsible for the current falls on stock markets. | |
Eurozone economies, from Greece and France to even Germany have been heading back towards recession, while China’s economic progress, still stronger than developed nations, has slowed dramatically. | |
Mr Polman said prices in Europe were lower than a year ago, adding to a relatively cool summer compared with last year that hit the Magnum ice cream maker. | Mr Polman said prices in Europe were lower than a year ago, adding to a relatively cool summer compared with last year that hit the Magnum ice cream maker. |
He said: “Altogeher this resulted in reduced third quarter growth, but still ahead of our markets... We expect markets to remain tough for at least the remainder of the year.” | He said: “Altogeher this resulted in reduced third quarter growth, but still ahead of our markets... We expect markets to remain tough for at least the remainder of the year.” |
Facing such tough times, Unilever kicked off a €500 million cost cutting drive this year Mr Polman said he was confident the company would beat rivals for profitable growth in sales volumes over the year. | Facing such tough times, Unilever kicked off a €500 million cost cutting drive this year Mr Polman said he was confident the company would beat rivals for profitable growth in sales volumes over the year. |
Underlying sales growth for the quarter, stripping out currency effects, was 2.1 per cent while volume growth was virtually flat. | Underlying sales growth for the quarter, stripping out currency effects, was 2.1 per cent while volume growth was virtually flat. |
Unilever is far from alone in the major consumer brands companies suffering the global malaise. Earlier this week both McDonald’s and Coca-Cola reported disappointing sales. | Unilever is far from alone in the major consumer brands companies suffering the global malaise. Earlier this week both McDonald’s and Coca-Cola reported disappointing sales. |
Shore Capital analyst Darren Shirley said Unilever’s sales were “below expectations in tougher markets”. The company’s shares fell 81.26p to 2452.74p. | Shore Capital analyst Darren Shirley said Unilever’s sales were “below expectations in tougher markets”. The company’s shares fell 81.26p to 2452.74p. |
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