Major price increases enabled Unilever to publish strong growth figures in the first quarter, while volumes fell only slightly. The multinational will continue to pass on rising costs for the rest of the year.
Household products considerably more expensive
Unilever saw turnover rise by 7.3 % in the first three months of the year. The strong performance is however fully attributable to price increases: the volume sold decreased by 1 % – still a very decent result in the context of strong inflation. The multinational increased prices worldwide by an average of 8.3 %, but in Europe, price increases were limited to 5.4 %.
Household products in particular saw a sharp rise in price, by as much as 12.5 %, which resulted in a 2.89 % drop in volume. In the beauty and care category, prices went up by 7.4 %, food and ice cream prices rose by 7.1 %.
“We continue to invest”
The price hikes will not stop there: in the first half of the year, Unilever expects costs to increase by 2.1 billion euros, in the second half of the year even 2.7 billion. And the company wants to continue passing on these cost increases, even though they will inevitably have an impact on volumes. For the full year, the multinational is aiming for a turnover increase of 4.5 to 6.5 % and an operating margin of 16 to 17 %.
“We are maintaining strong investment in our top brands, growing our thirteen billion+ Euro brands by 8.8 % in the quarter. E-commerce sales now represent 14 % of turnover following another quarter of strong double-digit growth”, CEO Alan Jope stressed.