Unilever: do first quarter results suggest it can continue solo?

By Lucy Whitehouse

- Last updated on GMT

Unilever: do first quarter results suggest it can continue solo?

Related tags Sales growth

With the multinational consumer goods giant recent first quarter results revealing an unexpected boost to sales growth, commentators suggest it’s a sign Unilever can go it alone.

The results - an underlying sales growth of 2.9%, beating most expectations of 2% - come following a takeover bid earlier this year from Kraft Heinz, which Unilever rejected in February.

As a Reuters report notes,​some of the firm’s shareholders had been disappointed with the company’s rejection of takeover and related talks. The multinational, which owns brands like Dove and Axe, is undertaking a comprehensive review of its business model.

Paul Polman, Unilever’s Chief Executive, said the latest results reconfirm the strength of Unilever's business model, and the subsequent rise in share value should further reassure investors. 

Polman confident: more agile and closer to local markets

The company’s chief exec asserted his belief that Unilever’s ahead-of-markets growth should continue, on the back of its strategic investment and long term, sustainable growth model.

The first quarter shows growth once more ahead of our markets. This reflects our continued investment in both innovations and brand support, and reconfirms the strength of our long term sustainable compounding growth model,”​ he said.

The change programme ‘Connected for Growth’ which we started implementing in the autumn last year is starting to bear fruit and is making Unilever more agile and closer to the local markets, unlocking both further growth and margin.

“The actions we are taking keep us on track for another year of underlying sales growth ahead of our markets, in the 3 – 5% range. We also expect an improvement in underlying operating margin this year of at least 80 basis points and strong cash flow. We are raising the dividend by 12%, reflecting the confidence in our outlook.”

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