Unilever, the household products group, said on Thursday that trading in its third quarter had been hit by poor weather in Europe and natural disasters in the Americas.
The Anglo-Dutch maker of brands such as Magnum ice creams and Dove soap reported third-quarter underlying sales growth of 2.6%, lower than expectations of 3.9% growth. However, the company did not alter its full-year guidance of underlying sales growth between 3-5%.
- Turnover of €13.2bn was 1.6% lower than in the same period last year due to a currency impact of 5.1%
- Underlying sales growth 2.6% in the third quarter, with prices up 2.4% and volume up 0.2%
- Emerging markets underlying sales growth in the third quarter 6.3% with volume up 1.8%
- Growth in the quarter adversely affected by poorer weather in Europe and natural disasters in the Americas
Paul Polman, chief executive, said: "The transformation of Unilever into a more resilient, more competitive and more profitable business continues and we are making good progress against the strategic objectives we have set out for 2020.
"While conditions in our developed markets remain challenging, we are starting to see signs of improvement in some of our biggest emerging markets including India and China.
"For the full year, we continue to expect underlying sales growth within the 3-5% range, an improvement in underlying operating margin of at least 100 basis points and strong cash flow."
"This is one poor quarter for a company that has delivered consistently for a long time," said Helal Miah investment research analyst at The Share Centre.
"It is expected that companies will suffer every now and then from externalities like the weather and natural disasters. We believe the longer term drivers of growth, in the shape of the emerging markets, will set the company up for sustained growth and we continue to recommend Unilever as a ‘buy’ for lower risk investors with a balanced portfolio.
"The group still trade close to its all-time highs, but investors could take advantage of this morning’s dip by drip feeding in for the long term."
Shares in Unilever on the London Stock Exchange were down 2.9% in early trade at £44.18.