Unilever’s overall business dipped only slightly in the most recent quarter despite the coronavirus crisis, propped up by surging demand from hunkered-down consumers for ice cream, soup and hand sanitizers.
The Anglo-Dutch consumer-products giant said its underlying sales in the second quarter fell just 0.3 percent overall despite a massive plunge in the company’s wholesale food-service business, which tanked 40 percent in the first half of the year as hotels, restaurants, cafes and bars shut down.
On the positive side, demand from locked-down customers fueled double-digit sales growth in Unilever’s retail food business. Its Knorr soup brand and Hellmann’s mayonnaise were strong performers, along with ice cream lines Magnun and Ben & Jerry’s, which helped drive a 26-percent surge in at-home ice cream sales.
Unilever shares surged as much as 9.1 percent to $60.96 in early trading as its performance beat analysts’ expectations for a 4.3 percent drop in underlying sales last quarter.
“We have demonstrated the resilience of the business — in our portfolio, in a continued step-up in operational excellence, and in our financial position — and we have unlocked new levels of agility in responding to unprecedented fluctuations in demand,” Unilever CEO Alan Jope said in a statement.
Sales of skin cleansing products spiked 27 percent as consumers focused on hand-washing to prevent the coronavirus, according to Unilever. But demand for skin care, deodorants and hair care products suffered as consumers “had fewer personal care occasions from going to work or socializing,” the company said.
Unilever also announced plans to spin off the bulk of its tea business — which includes major brands such as Lipton and PG Tips — into a separate entity by the end of next year. The company said it will hold onto its tea business in India and Indonesia following a strategic review of the segment that it announced in January.
With Post wires