Unilever lets customers pay for price hikes

Unilever is managing to offset higher costs with higher selling prices, keeping profit margins on track. The FMCG giant is even able to raise expectations for the rest of the year.

Expectations improve

The consumer crisis is not affecting Unilever that much: although volumes fell in the first half of this year, sales rose by 8.1 % as the FMCG giant manged to increase its prices by over 10 %. The group’s biggest brands, worth over a billion euros, grew by 9.4 %. Unilever performed particularly well in the United States and India. E-commerce now represents 14 % of sales, more than twice the figure of pre-pandemic 2019.

Despite a slightly lower gross profit margin, due to rising procurement costs, the margin remains on track at 17 %. For the rest of the year, CEO Alan Jope expects further price increases to not only keep that margin under control, but actually grow sales by more than the maximum 6.5 % the group had previously assumed.

The CEO added that his company continues to reshuffle its portfolio. Moreover, he introduced a new corporate structure on 1 July, which included the dismissal of 1,500 employees worldwide. Unilever also recently sold its tea division, buying the hair care products supplier Nutrafol instead.