Unilever's recent sale of its Skippy peanut butter brand in North America was just one indication of how slow-growing food businesses have begun to weigh down the global CPG giant.
Today's earnings report underscored that difficulty for Unilever:Fourth-quarter sales of Ben & Jerry's, Knorr soups and other Unilever food brands rose only 1.3 percent as consumers in debt-laden U.S. and Western Europe markets continue to pare back their supermarket purchases.
On the other hand, Unilever's business in Asia, Africa and Latin America demonstrated enough strength that the company was able to report an overall 5.4 percent rise in net profit for the period. In those markets, its revenues accelerated in home and personal-care items such as surface cleaners, soap and deodorant.
Around 55 percent of the Anglo-Dutch group's sales now come from emerging economies.
"It could be the launch of Tresemme [hair-care products] in Brazil, Indonesia, India," Chief Financial Officer Jean-Marc Huet told reporters, according to Reuters, explaining how Unilever is playing to its growing strength in emerging markets. He also cited the success of Magnum ice cream in the Philippines and Bertolli Gold olive oil spread in the Nordics.
While Dove Damage Therapy hair care and Rexona Maximum Protection deodorant were Unilever's standout successes in 2012, the company has high hopes for its new Axe/Lynx Apollo deodorant line, especially as buzz builds for the brand's out-of-this-world contest to land spots on a flight to space.
Yet, Huet said, 2013 "will continue to be difficult" in Unilever's markets. "Competition will remain intense and consumers are still feeling very much the effect of austerity measures."
Expect Unilever to continue a focus on helping consumers in the developing world to spiff up, rather than helping Americans and Europeans to chow down.
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