LONDON — Unilever, maker of brands ranging from Dove and Dermalogica to Hellmann’s and Ben & Jerry’s, saw second-quarter sales climb 4.9 percent to 14.4 billion euros, boosted in part by currency gains. Growth was 3 percent on an underlying basis.
Turnover in the six months to June 30 advanced 5.5 percent to 27.7 billion euros, including a positive currency impact of 1.7 percent and a 0.8 percent boost from acquisitions net of disposals. Sales were up 3 percent on an underlying basis.
Net profit in the half increased 22 percent, which the company said was due to increased efficiencies. Its plan, announced in the spring after a company-wide audit, to sell or spin off its stagnating spreads division is “well underway.”
Unilever also said its review of its complex, dual-headed legal structure (Unilever is based between London and Amsterdam) is also progressing well, and the company said it expects the board to decide the outcome before the end of the year.
Paul Polman, Unilever’s chief executive officer, said the first-half results show continued growth “well ahead” of Unilever’s markets and a “substantial step-up” in profitability despite a persisting volatile global trading environment.
He said that Connected 4 Growth, the group’s plan to streamline operations and become more agile and profitable, is delivering ahead of schedule. That program began last autumn.
Polman said Unilever is on track for another year of underlying sales growth ahead of its markets, in the 3 percent to 5 percent range. “We anticipate accelerating growth in the second half of the year driven by the phasing of our innovation plans and a step-up in brand and marketing investment,” he said.
Polman said market conditions in the first half remained challenging, with sales volumes “virtually flat” in aggregate.
“The economic crisis in Brazil continued to present a significant headwind. In India, trade stock levels thinned in the second quarter ahead of the implementation of the Goods and Services Tax, while markets in Indonesia were adversely impacted by fewer trading days due to public holidays,” he said.
The company said its personal-care category continued to grow and to expand in high-growth segments and in premium positioning, although challenging conditions in some of its key markets, such as India, Brazil and Indonesia, weighed on the overall growth rate.
Unilever said Baby Dove has now been introduced to 19 markets, while the new Lifebuoy with Activ Silver formula for enhanced germ protection was rolled out across Asia. In Indonesia, Unilever is launching Hijab Fresh, a new brand that it believes provides a solution to the specific needs of the Muslim population.
In hair, growth was driven by Sunsilk, which Unilever said was helped by the expansion into natural propositions that has driven increased penetration among Millennials.
Dermalogica also performed well, while Unilever’s recent acquisitions, Dollar Shave Club and Living Proof, which will contribute to underlying sales growth from next quarter and next year, respectively, continued to grow strongly, according to the company.