LONDON – Sales of soaps, hand gels and other personal hygiene products helped to boost flagging turnover in the first half at Unilever, the owner of brands ranging from Lifebuoy and Dove to Ben & Jerry’s ice cream.
Turnover in the six months to June 30 was down 1.6 percent to 25.7 billion euros, dented mostly by the negative impact of exchange rates and uneven sales due to COVID-19. Underlying sales growth eased 0.1 percent in the six-month period.
The company said that underlying operating profit rose 3.8 percent to 5.1 billion euros in the half. The quarterly dividend has been maintained at 0.41 euros per share.
Alan Jope, chief executive officer, said the first-half performance demonstrated “the true strength of Unilever” at all levels of the business and “agility” in responding to unprecedented fluctuations in demand. Jope also said the company did a good job of safeguarding supply and preserving cash.
He added that, moving into the second half, the focus would be on volume-led competitive growth and “absolute profit and cash delivery” with an eye to maximizing shareholder value.
The company said that with consumer habits and lockdown measures in flux, it has been quick to adapt and reallocate its brand and marketing investment “week by week.” Unilever said that, depending on how and where the virus was advancing or retreating over the past 6 months, it had reduced spend in some channels and geographies, while maintaining investment in “growth opportunities.”
Unilever said it expects to see a higher brand and marketing investment in the second half as lockdowns worldwide ease.
Among the hardest hit segments in the half were prestige beauty, due to the closure of non-essential retailers in key markets, and pre-prepared or packaged food such as ice cream, as no one was eating out, socializing in groups or attending large-scale gatherings.
Beauty and Personal Care, Unliever’s largest division, saw sales shrink by 0.3 percent to 10.6 billion euros in the half, while sales in the Foods & Refreshment division were down 1.7 percent to 9.8 billion euros. Home Care sales rose 3.2 in the first half 5.3 billion euros.
In the second quarter, turnover was down 3.1 percent to 13.3 billion euros, with underlying sales growth falling 0.3 percent.