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  • Beauty performs well for Unilever but ‘unprecedented’ inflation causes headache
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Beauty performs well for Unilever but ‘unprecedented’ inflation causes headache

By George C. Mikkelsen 3 years ago
By Becky Bargh
28-Apr-2022

The ‘human tragedy’ in Ukraine is just one of the factors driving up prices for Unilever, as well as inflation and supply chain issues

Paula’s Choice is part of Unilver’s Presitge category – it’s best performing group in beauty

Unilever’s beauty and personal care segment has seen respectable growth for Q1, with sales up 7.1% overall.

The consumer goods company’s best performing beauty category was prestige, with double-digit growth for the three month period.

Unilever has said that it will invest some €3bn in its prestige category through acquisitions and expansions, as well as digital commerce.

The Anglo conglomerate’s deodorant category – which it has vowed to reinvent – saw high single-digit turnover, helped by new launches from Dove, Rexona and Axe.

Skin, however, has been the slowest category in 2022, with growth in the low single figures.

In spite of the all-round positive results, Unilever has said that ‘unprecedented’ inflation will require the group to take ‘further pricing action’.

“There is more to do as we navigate our business through unprecedented cost inflation, but we are making good progress,” said Chief Executive Alan Jope.

“We are committed to sustaining this step-up in our growth and competitiveness.”

The business has prepared for input cost inflation of around €2.1bn in the first six months, with the second half predicted to increase to €2.7bn.

Jope also acknowledged the “human tragedy” in Ukraine as another significant challenge for the business.

But his outlook remains positive.

“The delivery of another solid quarter of sales growth builds on the improved growth momentum that we achieved in 2021 and is underpinned by Unilever’s increased focus on operational excellence, as well as disciplined adherence to our chosen strategic priorities.” he added.

“We remain on track to deliver the previously announced, simpler, more category-focused organisation structure on 1 July 2022.”

In January, Unilever set out plans to slash its corporate workforce by 20% globally.

Around 1,500 jobs are expected to be cut, 15% of which will be senior management jobs and 5% of its junior team.

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The decision comes after the group laid out plans to restructure its portfolio into five categories: Beauty & Wellbeing, Personal Care, Home Care, Nutrition and Ice Cream.

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