Investing.com -- Unilever’s (NYSE:UL) results on Thursday painted a mixed picture, with overall performance meeting expectations but offering little to excite investors.
The consumer goods giant reported full-year 2024 sales of €60.8 billion, marginally surpassing analyst forecasts.
Organic sales growth stood at 4.2%, slightly below the consensus of 4.3%, as price increases moderated and volume growth remained steady.
While the company achieved an operating profit of €11.2 billion, representing a modest increase over projections, its operating margin improvement of 15 basis points was largely in line with expectations.
Earnings per share reached €2.98, up 2.1% year-over-year, reflecting stable profitability despite macroeconomic pressures.
However, the outlook remains cautious. Unilever expects a slow start to 2025, with organic sales growth projected within the 3-5% mid-term range, but early quarters could see weaker momentum.
“The outlook stresses the expected slow start to 2025. While we think the outlook is in line with consensus for 2025, we would not be surprised to see Q1/Q2 consensus coming down,” said analysts at RBC Capital Markets in a note.
The company is also preparing for the planned demerger of its ice cream business, which will list in Amsterdam, London, and New York under the leadership of Jean-Francois van Boxmeer, the former CEO of Heineken (AS:HEIN).
Investor sentiment has been negative following the earnings release, with Unilever’s shares dropping more than 5%.
This reflects concerns over the lack of a stronger growth catalyst and uncertainty about the impact of restructuring efforts.
The announcement of a €1.5 billion share buyback, set to be completed before the ice cream unit’s spin-off, did little to offset worries about near-term headwinds.
Despite some progress under its new strategic direction, Unilever remains under pressure to accelerate growth and improve efficiency. While cost control and brand investments have helped stabilize margins, the market appears to be looking for more decisive signs of improvement in volume growth and category performance.
Unilever’s results on Thursday painted a mixed picture, with overall performance meeting expectations but offering little to excite investors.
The consumer goods giant reported full-year 2024 sales of €60.8 billion, marginally surpassing analyst forecasts.
Organic sales growth stood at 4.2%, slightly below the consensus of 4.3%, as price increases moderated and volume growth remained steady.
While the company achieved an operating profit of €11.2 billion, representing a modest increase over projections, its operating margin improvement of 15 basis points was largely in line with expectations.
Earnings per share reached €2.98, up 2.1% year-over-year, reflecting stable profitability despite macroeconomic pressures.
However, the outlook remains cautious. Unilever expects a slow start to 2025, with organic sales growth projected within the 3-5% mid-term range, but early quarters could see weaker momentum.
“The outlook stresses the expected slow start to 2025. While we think the outlook is in line with consensus for 2025, we would not be surprised to see Q1/Q2 consensus coming down,” said analysts at RBC Capital Markets in a note.
The company is also preparing for the planned demerger of its ice cream business, which will list in Amsterdam, London, and New York under the leadership of Jean-Francois van Boxmeer, the former CEO of Heineken.
Investor sentiment has been negative following the earnings release, with Unilever’s shares dropping more than 5%.
This reflects concerns over the lack of a stronger growth catalyst and uncertainty about the impact of restructuring efforts.
The announcement of a €1.5 billion share buyback, set to be completed before the ice cream unit’s spin-off, did little to offset worries about near-term headwinds.
Despite some progress under its new strategic direction, Unilever remains under pressure to accelerate growth and improve efficiency.
While cost control and brand investments have helped stabilize margins, the market appears to be looking for more decisive signs of improvement in volume growth and category performance.