UK/NETHERLANDS: Unilever cites challenging year as profits fall by 8% | Progresiv
Food giant Unilever has released its 2015 full year results, which, despite increased sales, show a drop in profits, in what it calls a ‘challenging year’. Overall turnover increased by 10%, while pre-tax profit fell by 8%, to 7.2 billion euros. Underlying sales growth was 4.1%. 
Unilever said its 2015 results are set against the context of challenging market conditions and fragile consumer demand. Many emerging markets continued to be weak, particularly those dependent on oil and other commodity exports and those where currency devaluation is pushing up the cost of living.
Commenting on the results, Unilever CEO Paul Polman said: “These results further demonstrate the progress we have made in transforming Unilever into a more resilient company, capable of consistently delivering competitive underlying sales growth, margin expansion and strong cash flow.” “We are preparing ourselves for tougher market conditions and high volatility in 2016. Therefore it is vital that we drive agility and cost discipline across our business.”
In the Foods division, Savoury showed good volume-driven growth led by cooking products in emerging markets and by innovations around naturalness and health. These include Knorr Mealmakers with 100% natural ingredients in Europe and fortified stock cubes which help address iron deficiency in Africa.
In dressings, Hellmann’s demonstrated good growth driven by a strong performance in Latin America and the success of new squeezy packs in Europe and North America. The Baking, Cooking & Spreads unit is repositioning the business to more attractive segments which helped us gain market share in margarine. However sales in spreads continued to decline as the company was unable to stem the sustained market contraction in developed countries.
Ice cream delivered strong growth driven by margin-accretive innovations behind premium brands, such as Magnum Pink and Black variants, the Ben & Jerry’s Cores range and new flavours of Breyer’s Gelato. The company continues to build its presence in the premium gelato segment with the recently acquired Talenti which grew more than 40% and with Grom which was acquired in October.
In leaf tea the company reinvigorated the Lipton brand with an improved mix and new packaging but growth was below markets. (www.foodingredientsfirst.com)
