Unilever, the maker of Dove soap and Hellmann’s mayonnaise, boosted its full-year sales forecast after reporting third-quarter sales growth that beat estimates on improved results in emerging markets and a strong performance from its ice-cream business.
Underlying revenue increased 5.7 percent, London and Rotterdam-based Unilever said Thursday, the best growth in almost three years and well above the 4 percent median analyst estimate. Growth accelerated from the second quarter’s 2.9 percent, boosted by the hottest European summer on record. It now expects full-year sales “towards the upper end” of a 2 percent to 4 percent range. The shares rose as much as 3.8 percent in early London trading.
“This was excellent reporting,” Sanford C. Bernstein analyst Andrew Wood said in a note. “All business lines beat expectations, and emerging-market growth increased further.” The company previously expected 2015 sales to be slightly ahead of the 2.9 percent growth achieved in the first six months.
Sales in emerging markets -- which comprise about 60 percent of Unilever’s business -- rose 8.4 percent in the third quarter, up from 6.5 percent in the second quarter, fueled by a rebound in China, higher prices for its goods across Latin America, and improvements in Russia and Japan.
“Countries such as India, China and Mexico are seeing improving consumer sentiment,” Graeme Pitkethly, Unilever’s chief financial officer, said by phone.
Unilever Chief Executive Officer Paul Polman has responded to the most difficult stretch of his seven-year tenure amid softer demand for the company’s products by acquiring high-end brands such as Grom ice cream and building a prestige skincare business.
Units sold in the quarter rose 4.1 percent, supporting the company’s forecast that selling volumes would improve over the course of the year. Sales in the unit that includes ice cream rose 8.5 percent, more than double the growth seen in second quarter.
Underlying sales exclude acquisitions, divestments, and currency fluctuations.