Unilever PLC UL shares are trading higher after reporting underlying sales growth of 7.0% in FY23, with price growth of 6.8% and volume growth of 0.2%.
Revenue fell 0.8% y/y to €59.6 billion on a reported basis, down 5.7% from foreign exchange and 1.7% from net disposals.
Segment sales: Beauty & Wellness increased underlying sales 8.3% y/y, underlying personal care sales increased 8.9% y/y, Home Care increased 5.9% y/y /a and Nutrition increased 7.7% y/y, while underlying ice cream sales decreased 2.3% y/y.
Gross margin increased 200 basis points to 42.2% due to cost reductions and improved net productivity.
Underlying operating profit was €9.9 billion, up 2.6% year-on-year, with the margin improving 60 basis points to 16.7%.
Underlying EPS stood at €2.60, up 1.4% y/y on the year.
The percentage of companies gaining market share on a rolling 12-month basis shrank to 37%, reflecting share losses to private labels in Europe, the shift of consumers towards super-premium segments in North America and a Significant reduction in unprofitable SKUs globally.
In 2023, the company returned €5.9 billion to shareholders through dividends and share buybacks.
Unilever completed the final two €750 million tranches of its €3 billion share buyback program in FY23 and approved a new share buyback program of up to €1.5 billion for fiscal year 24, which is expected to begin in the second quarter.
View: Unilever expects underlying sales growth for FY24 to be in the multi-year range of 3% to 5%, balanced between volume and price.
Additionally, the company expects modest improvement in underlying operating margin, with gross margin expansion driven by higher productivity and a return of net material inflation to more normal levels.
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Price action: UL shares rose 3.39% to $50.56 in premarket trading at last check on Thursday.
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