Unilever quarterly sales beat estimates as prices rise

LONDON (Reuters) -Unilever (LON:) on Tuesday reported better-than-expected underlying quarterly sales growth as the maker of Dove soap and Ben & Jerry’s ice cream again raised prices to make up for higher costs.

The British company reported a 7.9% rise in underlying second-quarter sales, beating analysts’ average forecast of 6.4%, a company-provided consensus showed.

The company said it expects underlying sales growth for the full year to be above 5%, ahead of its multi-year range, with underlying price growth continuing to moderate through the year.

“My early immersion in the business has confirmed my belief in Unilever (NYSE:)’s strong fundamentals,” new CEO Hein Schumacher said in a statement. These are Schumacher’s first Unilever results, having taken over from Alan Jope earlier this month.

Unilever, which in February forecast net material inflation in the first half of 2023 of around 1.5 billion euros, said at the time it would continue to raise prices in the first half of the year and ease up on those hikes in the second half. Underlying price growth for the second quarter was 8.2% while underlying volumes fell by 0.3%, beating analysts’ expectations of 7.7% and a drop of 1.2%, respectively.

Top U.S. and European investors told Reuters this month that they are flagging their concerns about high prices to consumer goods companies, with Janus Henderson going so far as to cut some stakes it holds and shorting food makers it believes are at risk of losing customers. The consumer goods industry has struggled with soaring costs for about two years, as everything from sunflower oil and shipping to packaging and grain has become more expensive. The higher costs began during the pandemic and took a turn for the worse after Russia invaded Ukraine, sending energy costs to record highs last year.

Rivals P&G and Nestle are set to report earnings results this week.