Unilever released its trading statement for the first quarter of 2011, highlighting the company’s fifth consecutive quarter of solid growth. Turnover increased by 7.0% to €10.9 billion, and underlying sales growth increased 4.3% with all the company’s categories growing and being particularly driven by emerging markets, which were up 9.9%. The company also reported that its integration of the Sara Lee personal care business and brands is on track.
Unilever CEO Paul Polman said of the statement, “We have delivered a good performance which demonstrates that the transformation of Unilever is progressing well; this against a backdrop of rising commodity costs, weak consumer confidence and very competitive markets. All categories are growing, driven by a particularly strong performance in the emerging markets. We have continued to deliver volume growth, albeit at a lower rate than in recent quarters, reflecting the pricing action taken and the sluggishness of the developed markets. Innovation continues to be the key driver of growth and we have rapidly extended great new products such as Dove Hair Damage Repair and Axe Excite into many countries. At the same time we have been extending our strong brands into new markets, such as Magnum into the United States and Indonesia and Dove Hair into China. The integration of Sara Lee’s personal care business is progressing well and we look forward to completing the acquisition of Alberto Culver in quarter two. We continue to focus on the long-term development of the business and our priorities remain: profitable volume growth ahead of our markets, steady and sustainable underlying operating margin improvement and strong cash flow.”
All categories delivered growth in the first quarter with positive price in response to rising commodity costs, with overall market growth across the company’s categories being resilient, but as prices increased, market volume growth slowed and was particularly weak in the developed markets. Unilever will continue to focus on launching bigger and better innovations and rolling them out more quickly. For example, Dove Men+Care and Dove Nutrium shower gel are both now in more than 30 markets and Lifebuoy is in 34 markets.
Specifically in the personal care division, deodorants continued to grow strongly and are gaining share. Performance was particularly strong in Dove, in both male and female, and especially in Latin America where growth was broad-based across brands and countries. The new Axe variant Excite has made a promising start, while the new Rexona for Women with MotionSense technology also has been launched and, by the end of the year, will be in approximately 30 markets. Skin cleansing also made good progress through Dove Nutrium moisture, as did Dove Men+Care, which was extended to the Australasian and Nordic markets. Lifebuoy delivered another quarter of double-digit growth with new market entries, new communication materials and improved product quality, and the Vaseline brand has now been launched in Turkey. Pond’s Gold Radiance in Face care is performing well where it has been introduced in Asia. In hair, the company saw resilient performances in the Americas and Asia, with strong progress in China. A new product range for dry and frizzy hair under the Dove Nourishing Oil brand shows early promise in the U.S., and Dove Hair Damage Repair continues to make good progress with recent entries in Japan and Indonesia. Sunsilk performance was more mixed but was notably strong in Italy and Greece. Also, oral care made a good start to the year with White Now continuing to drive growth and Signal Sensitive Expert receiving a positive reception in France. Closeup Firefreeze has also been launched in India.
For more information on this trading statement, click here.