Anglo-Dutch consumer goods maker Unilever expects new products and increased distribution to help its personal care business return to growth above 4 percent soon, after a recent slowdown. Alan Jope, head of the unit that includes Dove soap and Sunsilk shampoo, said he was not satisfied with its 2.4-percent growth in the year so far, but he was “determined and confident” there would be a rebound.
Speaking at an investor event at Unilever’s New Jersey offices that was simultaneously broadcast over the internet, Jope declined to say exactly when the rebound would happen. Since rebuffing an unexpected $143-billion takeover offer in February from Kraft-Heinz, Unilever has been under pressure to prove it can quickly deliver comparable returns as a standalone company.
In April it announced a share buyback plan, a new profit margin target, a plan to sell its shrinking margarine and spreads business and a review of its dual-headed Anglo-Dutch structure. In explaining the slowdown in the business that is seen as Unilever’s most attractive, Jope pointed to lower growth of the global market, weakness in two big countries – Indonesia and Brazil – and increased competition from local rivals, such as Patanjali in India and Wardah in Indonesia.
While the first two issues were temporary, Jope said local competition was a long-term phenomenon, and that was partly why Unilever was focusing on increasing its agility in local markets. Jope cited several new brands for aiding the unit’s growth, including prescription-strength Dove products for people with psoriasis or eczema; Skinsei, a personalized, subscription-based skincare regimen sold directly to consumers; and a beauty brand called Love Beauty and Planet.
Investors were disappointed last month when Unilever reported a surprise slowdown in sales, citing lost market share to smaller rivals in certain areas. Its shares have fallen more than 7 percent since then, but remain 26 percent higher than they were before Kraft’s approach. Unilever said on Tuesday it favoured collapsing its dual-headed, Anglo-Dutch structure into a single entity, but delayed a decision as to where it would be based, Britain or the Netherlands, avoiding for now a choice with political dimensions amid ongoing Brexit negotiations.