CBO reporter Guo Fen
Due to the situation in Russia and Ukraine and the rise in the prices of related raw materials, Unilever expects to further raise product prices in the future and raise input cost inflation in the second half of the year to about 2.7 billion euros.
Yesterday (April 28), Unilever announced its financial results for the first quarter of 2022.
According to the financial report, the company's Q1 revenue was 13.8 billion euros (about 95.816 billion yuan), an increase of 11.8% year-on-year; basic sales increased by 7.3% year-on-year, prices increased by 8.3%, and sales increased by 1%.
Commenting on the results, CEO Alan Jope said, "Driven by strong pricing, the company's underlying sales were 7.3 percent. This performance was achieved against the backdrop of a sharp rise in input costs in the first three months of the year, as well as the tragedy of the war in Ukraine, and we performed well in an extremely challenging environment. ”
In addition, due to the situation in Russia and Ukraine and the rise in the price of related raw materials, Unilever expects to further increase product prices in the future, and it is expected that the basic sales for the whole year of 2022 will be close to 4.5%-6.5%, and the basic operating profit margin for the whole year will be close to 16%-17%.
01
High-end beauty continues to grow in double digits
China's market grew by 6.4% in the first quarter
By business division, Unilever's three main business segments of Q1, Beauty & Personal Care, Home Care and Food, achieved sales revenue of 5.7 billion euros (about 39.576 billion yuan), 3 billion euros (about 20.83 billion yuan) and 5.1 billion euros (about 35.411 billion yuan), with basic sales increasing by 7.1%, 9.2% and 6.5% year-on-year.
Among them, the basic sales of beauty and personal care increased by 7.1%, prices increased by 7.4%, and sales increased by 0.3%.
Specifically in terms of brands, thanks to technological innovations from companies such as Dove and Rexona, fragrance products have seen high single-digit growth this year; Sunsilk and TRESemmé have contributed significantly to price-oriented growth, while Suave has declined.
Cleansing products achieved high single-digit growth, with Dove, Lux and Weibao performing well, but sales declined despite shrinking markets.
Supported by a rebound in the premium hair and cosmetics categories, Hourglass and Living Proof made a strong start. Following the reopening of the healthy beauty channel last year, Prestige beauty has seen double-digit growth.
Driven by North and South Asia, sales in the skin care industry grew by only single digits.
In terms of sub-regions, Unilever continued to perform well in key markets in China, India and the United States, with growth of 6.4%, 10.4% and 8.9% respectively.
At the same time, the electronic channel business continues to drive business growth, accounting for 14% of turnover.
02
A €750 million share repurchase program has been completed
Inflation cost expectations will be raised to €2.7 billion in the second half of the year
Unilever previously said in its 2021 earnings report that it will carry out a 3 billion euro (about 20.83 billion yuan) share repurchase program in the next two years, which is expected to start in the first quarter.
The company has launched its first €750 million share repurchase program on March 23. Unilever said it would continue this plan in the future to accelerate the growth of competitive content.
Notably, due to the outbreak of war in Ukraine and Europe, as well as rising raw material prices, Unilever raised its forecast for costs in the second half of 2022, expecting input cost inflation to be about 2.7 billion euros (about 18.747 billion yuan) in the second half of the year, which was previously forecast to fall to around 1.5 billion euros
At the same time, in the financial report, Unilever mentioned that the five different business structures previously planned to be established, namely beauty and health, personal care, home care, nutrition and ice cream, will take effect on July 1, 2022. It also expects that within the scope of the existing restructuring investment plan, the new structure will save about 600 million euros (about 4.167 billion yuan) in costs over two years.