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Unilever shares rise following publication of its full-year sales guidance on Tuesday.
As with many firms, Unilver has seen costs surge since the start of the pandemic compounded by the war in Ukraine which has seen energy and supply costs rocket.
Unilever’s first-half operating profit margin fell to 17% from 18.8% a year earlier, even as Unilever raised prices by 9.8%.
Unilever said Tuesday it now expects to beat its previous forecast for full-year underlying sales growth of 4.5% to 6.5%.
The price hikes come despite retailers pushing back against consumer product suppliers, worried about ceding margins and alienating shoppers.
“In the UK, consumers are starting to trade down to supermarkets’ own-label products because they are cheaper. That presents a real threat to Unilever’s earnings in the near-term if people shun its higher priced items. There is a risk this trend spreads to other geographies,” said AJ Bell’s Russ Mould.
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