Unilever, the Anglo-Dutch major maker foods and groceries, including Domestos, Dove soap and Knorr soups, has been hit hard by the fallout of the pandemic for an industry that many analysts thought would be immune.
There may be implications for Irish food giants such as Kerry Group which is preparing to update the market at the end of the month.
“Things will get more difficult before they get better,” Unilever chief executive Alan Jope said, pointing specifically to the impact on ice cream sales and a food solutions business that caters to canteens, restaurants and cafes.
Unilever, however, said it was positive that people would focus more on personal hygiene and has accelerated production of hand sanitisers, once a small part of its business, with 30 facilities globally producing the hydroalcoholic gel.
Underlying sales were flat in the first quarter, kept steady by increased sales in the US and Europe, where consumers stocked up on laundry detergents, Domestos bleach, and Cif cleaning products. However, growth was stalled by stringent lockdowns that curbed restaurant visits and shopping in China. Sales of ice-cream out of home — a €2bn annual business for Unilever — were badly affected s places such as parks, beaches and tourist sites were closed.
Its rival Nestle is due to publish quarterly sales figures later today while France’s Danone this week withdrew its financial guidance for 2020 but posted higher first-quarter sales.
"Overall, this is a fairly mixed update from Unilever with Covid-19 clearly impacting performance in certain parts of the business," broker Godbody said. "We suspect to see similar trends for Kerry though would flag its greater breadth of operations...which should lead to greater resilience," it said.