Unilever Shares Fall As Inflation Bites Into H1 Profit

Unilever PLC UL reported the first-half FY21 turnover growth of 0.3% year-on-year to €25.8 billion, beating the analyst consensus of €25.7 billion.
The company recorded a 5.4% Y/Y underlying sales growth, with 4.0% volume and 1.3% price.
The underlying operating profit for the half-year period fell 4.6% Y/Y to €4.85 billion, and the underlying operating margin declined 100 basis points to 18.8%.
Further cost inflation emerged through the second quarter, the company said.
Net cash flow from operating activities was €3.04 billion in H1.
Cash and equivalents totaled €4.2 billion, and net debt amounted to €22.4 billion as of June 30, 2021.
Underlying EPS for the first half of €1.33 beat the analyst consensus of €1.25.
"Cost volatility and the timing of landing price actions create a higher than normal range of likely year end margin outcomes. We are managing this dynamically and expect to maintain underlying operating margin for 2021 around flat," said CEO Alan Jope.
Outlook: The company revealed confidence to deliver underlying sales growth in 2021 well within its multi-year framework of 3-5%, despite more challenging comparators in H2.
Price action: UL shares are trading lower by 5.19% at $55.65 on the last check Thursday.