LONDON — Unilever posted a 2 percent decline in its third-quarter sales to 12.2 billion euros, or $15.86 billion, due to “weak” growth in emerging markets, a “sharp slowdown in China,” price deflation and poor summer weather in Europe, the company said.

The firm, whose personal care business includes the Dove, Axe and TRESemmé brands, also said that a negative currency impact of 2.6 percent contributed to the decrease.

Dollar figures have been calculated at average exchange for the period to which they refer.

Unilever said its underlying sales growth edged up 2.1 percent in the quarter, with revenue gains in emerging markets slowing to 5.6 percent and developed markets’ revenues falling 2.5 percent, resulting from a decline in the company’s food business.

“Macro-economic conditions continued to put pressure on consumers,” said Paul Polman, chief executive officer of Unilever, on Thursday.

“We expect markets to remain tough for at least the remainder of the year,” he said, adding that the firm has “further accelerated our initiatives to remove unnecessary cost, simplify the business and ensure that Unilever is both agile and resilient.

“We are confident that we will achieve another year of profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow,” he continued.

In geographic terms, the Americas region grew by 3.8 percent in the quarter, with underlying sales increasing there by 6.8 percent. Unilever noted that market conditions in North America improved, but that a promotional environment persisted. Latin America advanced by 12.4 percent, driven by price and against weak comparatives the previous year.

Unilever’s personal care division saw slower growth of 4.5 percent in the quarter, in part a result of the slowdown in China, which Unilever said has led to trade destocking. The firm said that Dove deodorants performed well, while of its skin-care brands Dove Nutrium body wash, Lifebuoy and Lux all grew. In hair, Unilever highlighted the performance of the Dove Advanced Hair series as “building a premium offering,” along with Sunsilk and Clear, the latter of which launched in Japan.

In the first nine months of 2014, Unilever’s sales fell 4.3 percent to 36.3 billion euros, or $47.19 billion, which included a negative currency impact of 6.6 percent.

Click Here for the WWD Global Stock Tracker >>

load comments
blog comments powered by Disqus