Unilever warns of ‘tougher’ 2016

By BBC

Consumer goods giant Unilever has reported a sharp fall in 2015 profit and warned of a tougher 2016.

The firm, which makes a vast array of consumer products including Ben & Jerry’s ice-cream, Lipton tea and Dove soap, said pre-tax profit fell 8% to €7.2bn (£5.5bn; $7.8bn) at constant currency rates.

Underlying sales rose 4.1%.

But the firm warned that it expected “tougher market conditions and high volatility” in 2016.

“We are preparing ourselves for tougher market conditions and high volatility in 2016, as world events in recent weeks have highlighted,” said Unilever chief executive Paul Polman.

The firm’s sales for 2015 were higher than analysts had expected, and Mr Polman said they had grown “ahead of our markets” despite slower global economic growth.

Unilever said underlying sales growth in emerging markets, where it makes more than half its sales, rose to 7.1% from 5.7% in 2014.

Despite the rise, the firm said demand continued to be weak, particularly for countries dependent on oil exports, while market growth in developed markets was “negligible”.

Unilever has been cutting jobs and trimming costs, and Mr Polman said the changes it had made meant the firm was a “a more resilient business”, but said it would continue to cut costs.

“It is vital that we drive agility and cost discipline across our business,” he added.

  

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