The Hague: Anglo-Dutch consumer giant Unilever Thursday revealed a drop in both sales and profits in the first half of 2018, saying markets remained “challenging” as it makes moves to leave its London base.
Sales fell some 5.0 per cent to €26.4 billion ($30.7 billion) in the first six months, down from €27.7 billion on the same period in 2017.
Net profits also slid by 2.4 per cent to €3.2 billion, down from €3.3 billion from January to June last year.
The company, which has over 400 household brands in its portfolio, said in a statement it was “a solid, all round performance with some challenging markets.”
Chief executive Paul Polman insisted “our expectation for the full year is unchanged,” adding the Rotterdam-based company believed it would have underlying sales growth in the 3 per cent — 5 per cent range” in 2018.
He also revealed that Unilever completed the sale of its margarines and butters division to US private equity giant KRR on July 2.
The first half of a six billion euros buy-back scheme also ended on Thursday, with the next 3 billion euros to start on Friday.
Unilever was founded in 1930 after the Dutch margarine producer Margarien Unie merged with British soapmaker Lever Brothers.
Its brands include such household names as yeast extract Marmite, PG Tips tea and Persil washing powder, Knorr soup as well as Dove beauty products and Magnum ice cream.
Until now, it has maintained a dual-headed structure, with listings on the London, Amsterdam and New York stock exchanges.
But in March, the company announced it was choosing The Netherlands over London to host its headquarters, dealing a blow to Britain’s efforts to keep multinational companies onside following Brexit.
The move came in the wake of a failed hostile bid by US rival Kraft Heinz last year, which analysts said played a key role in Unilever’s decision as the Netherlands has stronger rules to protect companies against takeovers.
But the move to leave London has left many investors uneasy as it may see the company forced to withdraw from the coveted FSTE 100 stock market.
Unilever said Thursday it would hold a general meeting for shareholders on the issue on October 25 and 26, with documents about its position to be sent out six weeks in advance.