Unilever hails best sales in more than a decade

Consumer goods giant Unilever has raised its annual outlook after recording its best quarterly sales performance in more than a decade, ahead of a £33.8 billion deal to spin off its food business.

The owner of Simple and Dove saw its shares surge 6% in morning trading on Tuesday after reporting a strong first-half performance, with sales growth accelerating to 5.8% in the second quarter.

This was driven by a 5.5% increase in sales volumes - the highest underlying volume growth in more than 10 years.

Overall, sales rose 0.5% in the first half, while pre-tax profits increased 1.8% to €4.66 billion (£3.98 billion) in the six months to 30 June.

Operating profits climbed 2.6% to €4.89 billion (£4.17 billion).

Unilever said it now expects full-year sales growth to be within its medium-term guidance range of 4% to 6%, having previously forecast growth at the bottom end of that range.

The group also expects underlying volume growth of around 3%, compared with previous guidance of at least 2% for the year.

All business groups reported underlying, volume-led growth in the first half. Beauty & Wellbeing, Personal Care and Home Care each delivered stronger growth in the second quarter than in the first.

Beauty & Wellbeing underlying sales increased by 5.9%. Growth was supported by brands including Dove, Sunsilk and Vaseline, alongside continued momentum in the prestige beauty portfolio. The Wellbeing business recorded low-single-digit growth, with performance improving in the second quarter.

Personal Care underlying sales increased by 4.8%. Skin cleansing and deodorants both recorded mid-single-digit growth, supported by premium product launches under the Dove brand and marketing campaigns linked to the FIFA World Cup 2026 during the second quarter.

The half-year results come as the group moves to combine its food business with that of US rival McCormick in a joint venture.

The joint venture, announced in March, will create a major food company combining brands such as Unilever's Marmite with McCormick's French's mustard.

However, some Unilever shareholders recently criticised the company's leadership at its annual general meeting for approving the deal without putting it to a shareholder vote.

Unilever Chief Executive Fernando Fernandez said on unveiling interim results: “We have delivered a strong volume-led performance in the first half, with a significant step-up in the second quarter – the best volume quarter at Unilever in over a decade.

“These results show our ability to continue performing while transforming our portfolio.

“Our combination of Foods with McCormick is progressing well and will unlock significant value.”