British consumer goods group Unilever has announced its financial results for Q1 of 2023, largely defined by a strong underlying sales growth of 10.5 percent driven by price growth in response to cost inflation.
Its price growth rose 10.7 percent, while all of its business groups and geographies also saw increases, including beauty and wellbeing, for which sales grew by 9.3 percent.
The prestige beauty and health & wellbeing categories each experienced double-digit growth, now accounting for 5 percent of the group’s turnover.
Unilever said its turnover rose 7 percent to 14.8 billion euros, with its brand portfolio accounting for 54 percent of said turnover, collectively delivering a sales growth of 12.1 percent.
In terms of geographies, Latin America stepped up 18.7 percent, while China returned to positive, up 1.8 percent following the lifting of pandemic restrictions.
While emerging markets saw sales rise 11.7 percent, developed markets increased by 8.7 percent. Volumes held up better in North America than in Europe, the group added.
Product-focused operating model drives positive outlook
The results come as an offset of Unilever’s efforts to turn to a more simpler, product-focused operating model, which was put into place July 1, 2022.
Due to such measures, the company said it is expecting around 600 million euros of cost savings over the first two years, with the majority delivered in 2023.
Additionally, following the completion of two 750 million euro tranches in 2022 of its ongoing three million euro share buyback programme, it launched a third tranche to be complete in July 2023.
For the rest of its outlook, Unilever said that despite “a volatile and high-cost environment”, it is still expecting to deliver another year of strong sales growth in 2023, with an improved performance compared to the previous year.
It is further anticipating a sales growth for the full year to be at least at the upper end of its 3 to 5 percent range, while its operating margin in the first half is expected to be at least 16 percent.
In its report, CEO Alan Jope further underlined the strong performance of the company, noting that it was still continuing to execute strategic priorities.
Jope continued: “We have stepped up both the effectiveness of our innovation and the investment behind our brands.
“Our new operating model is driving focused resource allocation, and is unlocking a culture of bolder, faster decision-making and disciplined execution.
“We remain focused on navigating through continued macroeconomic uncertainty and are confident in our ability to deliver another year of strong growth, which remains our first priority.”