Consumer goods giant Unilever has reported lower than expected fourth-quarter underlying sales growth due to weak emerging markets. As Hayley Platt reports it brings a disappointing end to the sector's most difficult year in recent memory.
Unilever's consumer goods are sold in 190 countries around the globe. And the slowdown in emerging markets is beginning to hurt. Although fourth quarter sales rose 2.1 percent, that was less than expected. Full year results also showed a disappointing rise of 2.9 percent. Justin Urquhart Stewart is from Seven Investment Management. SOUNDBITE: Justin Urquhart Stewart, Marketing Director, Seven Investment Management, saying (English): "The emerging markets needs to be split into two groups. Those that produce commodities and are suffering at the moment and those that use them such as India and China. So Unilever will be in a position where it can benefit from this whilst at the same time suffering from those that are going to have weaker positions at the moment." Emerging markets account for half of Unilever's sales . And the slowdown has already led Unilever to cut costs. Last year it axed 1,400 jobs, significantly reduced its product lines and sold off some under-performing businesses. These included, the Slim-Fast brand, Ragu and Bertolli pasta sauces as well as Skippy peanut butter. Chief Exec Paul Polman said he didn't see "a significant improvement in market conditions in 2015" and expected full year results to be similar to last year's. So where can Unilever find growth? SOUNDBITE: Justin Urquhart Stewart, Marketing Director, Seven Investment Management, saying (English): "I will point particularly to Asia, to South Asia and South East Asia. These economies aren't stopping, they're going to continue to grow and therefore the development of those brands. Although we've some issue of the top level brands in the luxury goods area that doesn't really affect Unilever so much. The development of products like soap and shampoo and all those other areas, they'll be rising demand for it." A modest pick-up in North America was partly offset by Europe's shrinking market. But Unilever remains a significant force. Two billion consumers are said to use at least one Unilever product every day.