© Reuters. FILE PHOTO: An image of the Unilever logo on a box of Dove soap in this illustration taken on January 17, 2022. REUTERS/Dado Rovik/Illustration
LONDON (Reuters) – Unilever reported better-than-expected quarterly sales growth on Tuesday as the maker of Dove soap and Ben & Jerry’s ice cream raised prices again to offset higher costs.
The British company reported a 7.9% increase in core second-quarter sales, beating analysts’ average forecast of 6.4%, a consensus provided by the company showed.
The company said it expects full-year underlying sales growth to be above 5%, ahead of its multi-year range, with core price growth continuing to moderate during the year.
“The early immersion in the business confirmed my belief in Unilever (NYSE:)’s strong fundamentals,” new CEO Hein Schumacher said in a statement. These are Schumacher’s first Unilever results, after he took over from Alain Job earlier this month.
Unilever, which in February forecast material net inflation in the first half of 2023 of about 1.5 billion euros, said at the time it would continue to raise prices in the first half of the year and moderate those increases in the second half. Core price growth for the second quarter was 8.2% while core volumes fell 0.3%, beating analyst expectations of 7.7% and a fall of 1.2%, respectively.
Major U.S. and European investors told Reuters this month that they had reported concerns about rising prices to consumer goods companies, with Janus Henderson going so far as to cut some of the stakes he owns and short selling to food makers they believe are at risk of losing customers. The consumer goods industry has suffered from rising costs for about two years, as everything from sunflower oil and shipping to packaging and grains has become more expensive. The skyrocketing costs began during the pandemic and took a turn for the worse after Russia invaded Ukraine, sending energy costs to record levels last year.
Rivals P&G and Nestle are set to report earnings results this week.