Unilever yesterday promised investors that new, cheaper products would help it grow profits, even as reticent consumers dragged its sales growth in the third quarter to its weakest in nearly five years.
Sales volume rose only 0.3 per cent, well below analysts’ estimate of 1.8 per cent and growth of 1.9 per cent in the first and second quarters.
Europe’s persistent woes and a slowdown in emerging markets, where Unilever has more than half its sales. In Britain, relatively wealthy consumers have snapped up goods such as its £29 jars of Maille mustard with wine and truffles. But it said that most consumers in most countries are cutting back.
Unilever is introducing cheaper products, such as smaller Cornetto ice cream cones that sell for €1 in Spain or one lira in Turkey.
“We’ve learned from the previous economic crises the importance of having such value brands… that can capture some of the downtrading that inevitably happens when disposable income levels fall,” said Unilever chief financial officer Jean-Marc Huet.