THE HAGUE - Dutch food and cosmetics giant Unilever said Tuesday it boosted net profit by 7% last year despite slowing sales as emerging markets cooled, but warned that the outlook for this year was not bright.
The company, which includes Lipton tea and Knorr soup in its stable of brands, said net profit came in at 5.17 billion euros ($5.99 billion).
Operating profit rose by 6% but sales slipped 2.7% to 47.4 billion euros after a slowdown in emerging markets which have been driving expansion in recent years.
We do not plan on a significant improvement in market conditions in 2015. Unilever Chief Executive Paul Polman
Adverse currency changes and the sell-off of certain brands also played a role. Removing these factors sales rose by 2.9%.
"Growth was weak in emerging markets as economic pressures impacted consumer demand," the company said in a statement, adding that expansion there had slowed to 5.7%.
In particular, growth rates in China and Africa were below trend, it noted.
Despite an improvement in the fourth quarter, when sales rose by 2.4% thanks to favorable exchange rate effects, the company was not optimistic about the market outlook.
"We do not plan on a significant improvement in market conditions in 2015," said chief executive Paul Polman, adding that Unilever would remain focused on competitive and profitable growth in order to turn in results similar to 2014.
The company said such a policy had allowed it to perform better than the overall markets in difficult conditions.
Unilever shares however slumped 1.8% in morning trade to 34.12 euros.
"The news from Unilever is disappointing," said Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers.
"Fourth quarter underlying sales growth is below forecast, with the slowdown in emerging markets again impacting."
Underlying sales growth was 2.1% in the fourth quarter, coming in at -0.7% in developed markets and 4.1% in emerging markets.
Copyright Agence France-Presse, 2015
