Unilever CEO signals M&A appetite, as hand sanitizers help sales
Unilever signaled the pandemic hasn’t damped the company’s appetite for acquisitions and reported better-than-expected revenue, fueled by consumers buying hand sanitizers and ice cream for home consumption.
Unilever shares gained as much as 8.1% after surprising the market with flat sales. Analysts expected a decline.
The maker of Magnum bars and Ben & Jerry’s ice cream has still been looking for purchases over the past six months, Chief Executive Officer Alan Jope said in a Bloomberg TV interview Thursday.
“If good opportunities emerge, we’re certainly in a strong position, especially with our healthy balance sheet, to take advantage of that,” Jope said.
The Anglo-Dutch company is in the process of abandoning its dual-headed legal structure.
“Further down the road, that could give us opportunities to look at more transformational acquisitions,” Jope said. “But I want to stress there’s nothing of that nature on the imminent radar.”
Underlying sales fell 0.3% in the second quarter. Analysts expected a 3.9% decline.
To respond to the changes in demand, Unilever increased its capacity to make hand sanitizer by about 600 times and expanding its Lifebuoy hygiene brand to more than 50 markets.
Unilever also said it plans to keep its tea business in India and Indonesia as well as stakes in ready-to-drink beverages even as it tries to sell the rest of the unit, confirming a previous Bloomberg report. The assets being sold have annual revenue of 2 billion euros ($2.3 billion).