Amsterdam : Unilever NV, maker of consumer products such as Ben & Jerry's ice cream and Dove soap, saw fourth quarter earnings fall by 27 per cent after its year-ago figures were boosted by a one-time gain on the sale of its Bertolli olive oil business.
Net profit was 831 million euros ($1.15 billion, Dh4.224 billion) down from 1.14 billion euros a year earlier, when Unilever sold Bertolli to Spain's Grupo SOS for 630 million euros. Fourth quarter sales fell 5 per cent to $9.66 billion euros, also due in part to the Bertolli sale.
Unilever said that stripping out the impact of disposals and restructuring, fourth quarter operating profit would have risen 4 per cent.
It said sales measured on the same basis rose 1.8 per cent, with volume growth of 5 per cent outweighing price falls of 3.1 per cent.
Over the past year, Unilever has cut prices in order not to lose market share as customers show a preference for cheaper brands during the recession.
In 2010 "consumers will be even more demanding, and rightfully so", said Chief Executive Paul Polman on a conference call. "Our priorities therefore for 2010 are to drive volume growth while providing a steady improvement in underlying profit margin."
Shares fell 2.5 per cent to 21.93 euros in early trading in Amsterdam.
"Unilever has delivered a solid if not inspirational performance," said analyst Keith Bowman of Hargreaves Lansdown in a note on the earnings.
He praised the company's sales growth, particularly in Asia and Africa. There sales rose 7.4 per cent and are now substantially larger than in either the Americas and Europe. Sales growth in the Americas was 1.2 per cent, while sales fell 4.2 per cent in Europe.
Bowman warned that Unilever's costs could rise this year, threatening the company's plans to continue improving both sales and margins.
"On the downside, commodity prices remain volatile, while a recent recovery in advertising volumes for the media industry could see a bounce back in prices," Bowman said.
Unilever's full year net profit was 3.66 billion euros, down 33 per cent from 2008, on sales of 39.8 billion euros, which were down 2 per cent.
