Marmite owner Unilever reports underlying growth

Marmite maker Unilever saw rising sales driven by success in emerging markets during the first quarter, but Europe remained slow.

The consumer goods and food giant owns a host of brands including Marmite. Picture: Gabriel Szabo/Newscast

The group reported a 1.6 per cent decline in overall turnover to €12.4 billion (£10.74bn). But on an underlying basis, sales were up 3.1 per cent.

The decline in headline turnover was due to the disposal of the spreads business, which completed in July last year.

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The unit, which included brands such as Flora and I Can’t Believe It’s Not Butter, was sold to KKR for €6.83bn.

Growth in Unilever’s continuing operations remained solid, particularly in emerging markets, where underlying sales were up 5 per cent.

These markets were led by South East Asia and Brazil, while India also grew well though slightly slower than in the fourth quarter.

However the company said growth remained weak in developed markets, while high inflation weighed on global market volume growth.

In Europe, underlying sales grew just 0.7 per cent. Strong ice cream performance was a boost for the UK and Italy, but retail conditions were “extremely challenging” in Germany.

Chief executive Alan Jope, who succeeded longstanding boss Paul Polman at the start of this year, said: “We have delivered a solid start that keeps us on track for our full-year expectations. Growth was led by emerging markets and was balanced between volume and price.

“Accelerating growth is our number one priority. It requires both great execution and a continued strategic shift into faster growth segments and channels.

“We saw good performance in key growth channels, including out of home and e-commerce, and benefited from stronger global innovations and faster and more relevant local innovation.”

In December, Unilever signed a deal to acquire Horlicks and a clutch of other health drink brands in India from drugs maker Glaxosmithkline (GSK) for €3.3bn.

The move made its Indian arm one of the largest food and refreshment groups in the country.

Meanwhile, in the UK the company has said it is stockpiling goods ahead of Brexit in case there is disruption to the supply chain.