Unilever Releases Q2, First Half 2013 Financials

Unilever released its financial results for the first-half 2013, citing how its strong innovation pipeline and focus on sustainable growth helped to drive the business forward. Highlights of the results include underlying sales growth of 5% with emerging markets up 10.3%, underlying volume growth 2.6% and pricing up 2.3%, and turnover up 0.4% at €25.5 billion with currency (3.2)% and disposals (1.1)%. Additionally, second quarter 2013 highlights include underlying sales growth at 5% with volume growth of 3% and price growth of 2%.

The company delivered another quarter of solid growth, led by emerging markets which continued to grow at 10.3% with a good balance between volume and price. Developed markets declined by (1.3)% in the quarter, with both negative price and volume.

All categories grew globally with strong growth from Unilever's home care and personal care divisions. Gross margin increased by 120bps to 41% at constant exchange rates, primarily due to the mix benefit of higher margin products and continued discipline around savings programmes. Core operating margin, up 40bps at 14%, reflected higher advertising and promotions investment behind the company's brands.

Commenting on the results, Unilever CEO Paul Polman said, “This set of results clearly demonstrates that the transformation of Unilever to a sustainable growth company is fully on track. Our innovation pipeline is robust, which will be vital as we navigate the slowdown in many parts of the world. Our focus on gross margin is also starting to bear fruit: we are delivering more profitable innovations, improving mix and continuing to apply a rigorous approach to supply chain costs and savings.”

Looking forward, he adds, “We remain focused on achieving another year of profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow.”

For Unilever's personal care division, hair performed well despite highly competitive markets. Dove benefited from the roll-out of Dove Repair Expertise and Men+Care hair, while TreSemmé also delivered broad-based growth, underpinned by the Keratin Smooth range and good progress in new markets. Sunsilk grew on the back of the successful essential oils variant in Indonesia and a new conditioners range in Turkey. Clear continued to make good progress.

Skin cleansing continued to deliver robust growth reflecting the success of the improved Dove Nutrium Moisture shower range and Dove Men+Care. Vaseline growth accelerated, helped by the successful launch of the Spray & Go moisturiser. And Pond’s Flawless White BB is being rolled out to new markets after the successful launch in Thailand, while Pond’s Men has been rolled out to Indonesia.

Deodorants growth was driven by the continuing success of compressed deodorants, Axe Apollo and the Rexona ‘Do More’ campaign. Oral care performed well despite increased competitive intensity with the roll-out of the Expert Protection range to Zhong Hua in China and good momentum behind Pepsodent 1-2-3.

Full financial results from Unilever's first half 2013 are available here.

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