There was only one small mention of its day-old purchase of razor company Dollar Shave Club in personal goods giant Unilever's (ULVR) results, but the male grooming trend might become more important. With underlying sales growth in developed markets rising a meagre 0.2 per cent, gaining access to alternative growth segments could be key. Management said it was "addressing the higher growth male grooming segment" with the launch of its new Axe range and this could further accelerate its personal care division, which saw underlying sales rise 5.7 per cent. The Dollar Shave deal not only compliments its male-orientated product range, but also suggests the goliath is aware of the threat to its market share from high-growth online players.
In the meantime, chief executive Paul Polman said the group had maintained its discipline around costs as part of a wider strategy overhaul, which includes outselling competitors and growing operating margins. This will be key given Mr Polman does "not see any sign of an improving global economy".
Unsurprisingly, emerging markets put in a robust performance against their developed brethren with a rise of 8 per cent in underlying sales. That regional division was helped by an accelerated double-digit growth in the Philippines, Russia returning to volume growth and India and Africa also performing well. Sales in China were flat but management commended its progress in the e-commerce market there.
Latin America was another highlight following the launch of stain remover brand Omo in Brazil, which will now be rolled out across the rest of the continent. This product, alongside the likes of Comfort fabric conditioner and Domestos toilet cleaner, helped make the home care division the standout performer. Underlying sales rose 6.5 per cent which, alongside continued cost savings, helped push up core operating margins there by 250 basis points and underlying profits by 3.5 per cent.
Analysts are updating forecasts, but before these results Investec expected EPS of 188¢ (157p) for the year to December 2016, compared with 182¢ for FY2015.
| UNILEVER (ULVR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 3,558p | MARKET VALUE: | £106bn* | |
| TOUCH: | 3,554-3,556p | 12-MONTH HIGH: | 3,716p | LOW: 2,450p |
| DIVIDEND YIELD: | 2.8% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 1,105¢** | NET DEBT: | 83% | |
| Half-year to 30 Jun | Turnover (€bn) | Pre-tax profit (€bn) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 26.99 | 3.61 | 88.0 | 42.9 |
| 2016 | 26.28 | 3.64 | 88.0 | 52.5 |
| % change | -3 | +1 | - | +22 |
Ex-div: 4 Aug Payment: 7 Sep *Reflects combined value of Unilever NV and Unilever plc **Includes intangible assets of €24.5bn, or 1,870¢ a share £1=€1.20 | ||||
