Yahoo Finance Marmite inflation: How Unilever has raised prices of household staples
Product prices went up the most in Europe across all sectors
Unilever (ULVR.L) sales grew 9.1% as the company increased prices of goods by almost 9.4%, compared with 13.3% in the final three months of last year, according to the firm's first-half results.
Sales in the personal care sector grew the most — up by 10.8%. Sales in the beauty and wellbeing sector grew by 9.1% from January to June, home care sales grew 8.4%, nutrition 10.4%, while ice cream sales grew 5.7%.
Unilever product prices
The price of a 500g jar of Marmite averaged £5.85 in July 2023 compared to £4.75 a year ago — a jump of £1.10.
Ben & Jerry’s ice cream (465ml) was 5p more expensive at £5.00 compared to £4.95 in July 2022.
A four-pack of Magnum ice cream cost £4.74, up from £3.25 a year before.
A 250ml tub of Vaseline rose to £3.75 in July, up from £3.38 last year.
Prices went up the most in Europe across all sectors by an average of 14.2% for the first six months, leading to a fall of 6.8% in volume sales for Europe.
In Asia Pacific and the Americas, prices went up by 8% and 8.6% respectively, where Unilever kept a sales volume increase of 1.1% and 1.8% respectively.
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Despite price increases eroding volumes by 0.2% over the first half, the company announced that net profit was up 20.7% compared to the same period last year.
However, the Unilever's chief executive Hein Schumacher suggested that further price increases are not going to be as steep going forward.
“In a volatile and high-cost environment, we will deliver another year of strong underlying sales growth in 2023. We expect underlying sales growth for the full year to be above 5%, ahead of our multi-year range, with underlying price growth continuing to moderate through the year,” Schumacher said.
Unilever’s share price was up nearly 5% on Tuesday.
Danni Hewson, head of financial analysis at AJ Bell, said: “Group sales growth has come entirely from putting up prices, not shifting more units of products. The sign of a good business is one that can grow prices and volumes. Unilever’s group volumes actually declined in both the first and second quarter periods.”
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He also noted that Schumacher is still new in the CEO role.
“He talks about bringing greater focus, sharper execution and a simplified operating model. We’ve heard all of this before and the proof of the pudding will be in the execution, not simply sweet-talking investors into thinking a new CEO automatically equates to greater success.”
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