Unilever’s volume push ensures solid fourth quarter

Posted by Daniel Palmer on 5th February 2010

Dutch-based consumer products giant Unilever has reported strong volume growth in the fourth quarter, albeit at lower prices, with sales for the quarter rising 1.8% on an underlying basis and 3.5% for the full year. Volumes rose 5% during the fourth quarter and 2.3% for the year.

The maker of Streets, Lipton and Dove products said a more efficient supply chain assisted margins and also helped improve on-shelf availability of their products.

“We made good progress in challenging market conditions,” Chief Executive Paul Polman proclaimed. “Our market share improvements were broad-based and improved throughout the year. Our brands are stronger, driven by better quality innovation and a step-change in advertising and promotional expenditure.”

Their Asia Africa division was one of the leading performers, with volume growth accelerating in the second half of the year.

“Momentum continued in the South East Asian markets, especially Australia which saw strong growth across the entire ice cream range,” the company said.

“Having established the regional supply chain centre in Singapore we are increasing leverage, speed and scale across the region.”

Competitive pressure to rise

In Mr Polman’s discussion of forecasts for the year ahead, he insisted the group was well placed to come through 2010 in strong shape but remained wary of consumer spending levels.

“We expect continued pressure on consumer spending power and heightened levels of competitive activity in 2010,” he explained. “We will continue to focus on volume growth as the main driver of long term value creation, whilst delivering steady and sustainable year-on-year improvement in operating margin and strong cashflow.”