Unilever is NOT profiteering
As prices rise again, boss insists:
Departing Unilever boss alan Jope insisted the company was not ‘profiteering’ as rising prices boosted business.
in his last update as chief executive of the consumer goods giant, Jope said he was ‘very conscious that the consumer is hurting’.
and he insisted rising prices – 11pc in the first quarter of the year – were not evidence of socalled ‘greedflation’.
‘i know it’s an inconvenient truth, but we have not been profiteering in any way, shape or form,’ Jope said.
‘We’re very conscious the consumer is hurting and that’s why we are not passing through the full price increases and are asking shareholders to bear some of the burden.’ the comments came as the latest update from the company, whose brands include Hellmann’s, Marmite and Dove as well as Magnum and Ben & Jerry’s ice creams, showed that it successfully passed on price increases without significantly denting sales volumes.
in the first three months of the year, sales were 10.5pc higher than in the same period a year earlier at £13bn, driven by a 10.7pc increase in prices and a 0.2pc fall in the volume of goods sold.
this was an improvement on the fourth quarter of last year, when prices rose 13.3pc and volumes fell 3.6pc. Jope (pictured), who took the helm in January 2019 and will be replaced by Hein Schumacher in July, said the pace of rises is likely to ‘soften through the year’ but warned they will remain high. ‘We are past peak inflation... though we are still not past peak prices,’ he said. ‘Costs are not going down, they’re just not going up as quickly as before.’ Jope said Unilever only passed on 75pc of cost increases to consumers last year and he justified future elevated prices as necessary for investment. the Scottish businessman said he anticipates further inflation in prices, particularly in food, driven by high costs of materials and climate change.
inflation remained high in nutrition and ice cream, with prices up 13.4pc and 10.5pc respectively, although it has moderated across Unilever’s beauty and wellbeing and personal care ranges, which were up 6.5pc and 9.4pc respectively year-on-year.
Margins are often a good indicator of whether a company is profiting from higher prices.
Unilever expects a first-half margin of 16pc, broadly in line with the 16.1pc figure for 2022 and below those in the previous three years.
it also predicts to have ‘modest improvement’ in margins this year. its shares rose 1.4pc, or 60p, to 4431.5p, and have gained just under 8pc under Jope.
in that time he has been paid more than £16m and the FtSe 100 index has risen 16pc.