Unilever boosts sales amid mainstay pricing struggles

Unilever is introducing new products such as Dove shower foam to boost sales as it struggles to raise prices on longtime mainstays like Hellmann’s mayonnaise, writes Thomas Buckley

The Anglo-Dutch consumer-product company introduced five brands in its personal-care division last year, including Hijab Fresh, a hand and body lotion aimed at Muslim consumers, and soaps formulated for babies.

That helped it drive sales growth that beat analyst expectations in the fourth quarter, even as price increases fell short.

“We do see that higher- volume, lower-pricing mix persisting, especially in the first half,” chief financial officer Graeme Pitkethly said.

The results close out a tough year for Unilever after it rebuffed an unsolicited takeover bid from Kraft Heinz, sold its struggling margarine brands to private equity firm KKR, and lifted its forecasts for cost savings and profitability to compete with rivals who have increased earnings faster.

Unilever expects revenue growth of 3% to 5% this year as US tax cuts boost global economic expansion, it said. Underlying sales rose 4% in the fourth quarter.

That came as underlying prices rose only 0.7%, held back by deflationary pressure in the US, emerging markets and European countries where discount grocers are making gains.

- Bloomberg