Shares in consumer goods behemoth Unilever (LSE: ULVR) were down 2.3% in early trading, as the group reported underlying sales growth of 2.1% for Q3, short of analyst expectations. A combination of negative currency impact, acquisitions and disposals resulted in a turnover decline of 2.0% in spite of the underlying rise.
The company warned that the market slow-down in China resulted in a 20% decline in underlying sales for the region. The company expects to face difficult market conditions for at least the remainder of the year.
However, a combination of price and positive volume growth led to a 12.4% rise in turnover in Latin America.
The Personal Care product line performed well over the quarter, with growth from deodorant Dove, health and hygiene products Lifebuoy and new toothpaste Regenerate Enamel Science. Homecare performance was boosted by new product launches of stain remover Omo in Brazil and washing powder Surf in South East Asia and Australasia. Foods was the only category to suffer falling turnover, where growth in savoury and dressing products could not offset the ongoing decline in sales of spreads.
CEO Paul Polman noted that, while Q3 growth fell short of expectations, the company still outperformed across its markets. Looking forward, he said:
“We are confident that we will achieve another year of profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow.”
