Shares in Unilever (LON:ULVR) have lost more than four percent in London this morning after the Anglo-Dutch consumer goods giant updated investors on its full-year performance, posting a dip in turnover. The company further noted that it expects the market to remain challenging going forward.
As of 10:24 GMT, Unilever’s share price had lost 4.38 percent to 3,202.00p, underperforming the benchmark FTSE 100 index which has climbed marginally into positive territory and is currently 0.20 percent better off at 7,178.63 points. The group’s shares have gained some eight percent over the past year, but are down by nearly three percent so far in 2017.
Unilever announced in a statement this morning that its sales had increased by 4.3 percent at constant exchange rates last year, while turnover, which is calculated at current rates, dipped one percent, with the company having experienced challenging market conditions throughout the year, particularly in the fourth quarter.
“We have delivered another good all-round performance despite severe economic disruptions, particularly in India and Brazil, two of our largest markets,” chief executive Paul Polman said in the statement, adding that “the tough market conditions which made the end of the year particularly challenging are likely to continue in the first half of 2017”.
City A.M. quoted Andrew Wood, senior research analyst at Bernstein, as commenting that although Unilever had achieved ‘reasonable’ organic growth and a “solid operating performance in tough markets” in the fourth quarter, the results meant that the broker’s top-line growth expectations for the year ahead were too high.
“We would expect a negative stock reaction to today’s reporting, especially given the top-line weakness and the cautious guidance for early 2017,” the analyst pointed out. The newswire also quoted Darren Shirley, analyst at Shore Capital, as calling the results ‘a mixed bag’.