Unilever quarterly sales beat estimates as prices surge

UNILEVER smashed quarterly sales forecasts on Thursday (Apr 27) as another big rise in prices from the maker of Dove soap and Ben & Jerry’s ice cream triggered only a small dip in volumes.

Packaged goods companies have been hiking prices as they grapple with a surge in costs of everything from sunflower oil and shipping to packaging and grain.

Consumers have so far coped with the cost-of-living squeeze better than many analysts had expected, but some warn companies could eventually take a hit to margins if shoppers start switching to cheaper brands in greater numbers.

Unilever reported a 10.5 per cent rise in underlying first-quarter sales to 14.8 billion euros (S$21.8 billion), beating analysts’ average forecast for a 7.2 per cent increase, according to a company-provided consensus.

That included a 10.7 per cent increase in prices and a 0.2 per cent dip in volumes.

“Underlying sales growth accelerated to 10.5 per cent, driven by price growth in response to continued high input cost inflation and an improved volume performance,” CEO Alan Jope said.

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Rivals P&G and Nestle have also recently reported stronger than expected quarterly sales, with price hikes offsetting lower volumes.

Unilever reiterated it expected price growth to remain high during the first half of the year, but soften through the year as inflation abates. REUTERS