Unilever reports higher sales in third quarter

Growth accelerated from the second quarter’s 2.9 per cent, boosted by the hottest summer on record.

Consumer goods maker Unilever today reported better than expected third-quarter sales, but said sluggish markets globally continued to weigh on its performance.

Underlying sales increased by 5.7% in the three-month period, with volumes up 4.1% and price up 1.5%. It now expects full-year sales “towards the upper end” of a 2 percent to 4 percent range. Unilever shares were 3.8 per cent, or 107p higher at 2,897p, making the firm one the biggest risers on the FTSE 100 index.

“The implication from guidance is that the fourth quarter will be off the steroids”, said Jefferies analysts in a note.

Unilever said better weather than a year ago boosted sales of ice creams such as Magnum and Solero, while new versions such as Magnum Pink and Black and Ben & Jerry’s Cookie Core range in Europe and North America also helped.

“In fact, in a number of countries, the economic environment is getting worse, with the situation on the ground dominated by the effects of currency depreciation”, said Graeme Pitkethly, two weeks into the job as chief financial officer.

Paul Polman has responded to the most hard stretch of his seven-year tenure amid softer demand for the company’s products by acquiring high-end brands such as Grom ice cream and building a prestige skincare business. Underlying sales growth in the emerging markets recovered further, whilst its North American business returned to growth, ‘ he said.

Units sold in the quarter rose 4.1 percent, supporting the company’s forecast that selling volumes would improve over the course of the year.