By Chandini Monnappa
(Reuters) -Unilever beat estimates for first-quarter underlying sales growth on Thursday, helped by price increases and strong demand for its premium products, and said it expected the direct impact of tariffs to be limited.
Consumer goods companies, already struggling to regain customer loyalty after years of sharp price increases, have in recent months found themselves grappling with uncertainty caused by Washington’s unpredictable tariff moves.
“Given our investments in America and our predominantly local supply chains, at this time, we expect the impact to be limited.” CEO Fernando Fernandez told analysts in a webcast.
Thursday’s update marks Unilever’s first since it surprised investors in February by ousting former CEO Hein Schumacher and appointing the group’s finance chief, Fernando Fernandez, as his successor.
Unilever reported 3% underlying sales growth for the quarter ended March 31, topping analysts’ expectations of a 2.8% rise and reaffirmed its 2025 outlook.
Unilever shares ticked up 0.8% in morning trade, while shares of its rival Nestle were down 0.3% after it reported better than expected quarterly organic sales while saying the indirect impact of U.S. tariffs was “unclear.”
“For many, Unilever will continue to be seen as a solid defensive play and a core constituent of most portfolios,” Richard Hunter, Head of Markets at interactive investor said.
“Its characteristics have come into their own amid an uncertain global economic environment,” Hunter said.
Unilever said its largest brand Dove, and other power brands Vaseline, Liquid I.V., and Magnum saw strong demand during the quarter.
It also said that while it was confident about this year’s performance, it was conscious of the economic conditions, with uncertainty surrounding currency stability and consumer sentiment, and would be agile in adjusting its plans as needed.
Fernandez also reassured analysts that the company would not rush into operational changes due to sharp currency swings.
Under its previous CEO, Unilever laid out planned cost cuts last year, including separating the ice cream division and cutting thousands of jobs to address years of underperformance.
In its update, Unilever said it was on track to complete the separation of its ice cream business in the fourth quarter of 2025 and expected it to start operating on a standalone basis from July 1. The business, which owns five of the world’s top 10 brands, including Magnum and Wall’s, is due to be listed in Amsterdam with secondary listings in London and New York, Unilever said in February.
($1 = 0.7537 pounds)
(Reporting by Chandini Monnappa in Bengaluru and and Richa Naidu in London; Editing by Sherry Jacob-Phillips, Louise Heavens and Tomasz Janowski)
