Unilever Nabs a Spot at Top Food Table in Europe

Unilever London

Unilever London

Unilever has finally managed to grab a spot at the top table in Europe after remaining idle for a long time unlike other food groups. Stakeholders are quite impressed with the group for producing dependable results.

Even though investor preference, Nestle, still continues to exercise its hold over the market, the Anglo-Dutch company has managed to boost its profitability up to an extent that it has now overtaken Danone, the French group on that score and the business’s shares are now traded at a ratio to earnings almost equal to its Swiss competitor.

Effective Changes

Paul Polman, the marathon-running CEO, began to consider long-term operations when he was handed the reins of the company almost 3-1/2 years ago, instead of focusing his attention on economic goals that had not been suitable for development. Unilever chose to direct its investment emphasis or definite international brands like Omo detergent, Lipton Tea and Ben and Jerry’s Ice Cream. This move resulted in their entering fast developing budding markets while introducing new products at the same time. Their brand valuation now stands nearly close to the biggest food group in the world with respect to sales, Nestle.

The two companies had entered a long-standing struggle to the top during the time of a global financial crisis but had made it through the first half with no considerable damage. However Danone lost reliability due to a shock profit alert after its sales took a major hit in recession-ridden Spain.

Financial analysts choose to compare the three largest food groups in Europe since they fall in the same group as the six biggest food brands worldwide. Several of them think that Unilever has comparatively better management at present and is able to provide sound and steady working performance into the medium tenure. According to data from Thomson Reuters, the shares of Unilever saw a 10 percent increase since Danone’s profit warning that took place in June. Now the group trades at 16.9 times the 2012 forecast earnings which is very close to the 17.2 maintained by Nestle and much more than Danone’s 15.2.

The greater part of Unilever’s sales are derived from shampoos, soaps and detergents instead of food. But it has fared better than its major competitor in the consumer product market, the U.S. conglomerate Procter and Gamble, whose profits have remained the same for about three years.

Overcoming Tough Times

Unilever had earlier prioritized the increase in market spending for one quarter, only to cut it back the next so that short term objectives could be met. But stability of sorts came over the entire company when 56 year old Polman took over. In 2004, the company faced its darkest moment yet when it issued the sole profit warning in its prolific history of almost 82 years.

The company is not focused on its short-term prospects at the moment. Unilever’s Dutch chief executive now has only one advice for investors who are interested in fast returns – Go elsewhere. The man seems to be aware of what he is doing as Unilever’s underlying sales have grown by an average rate of 5 percent in Polman’s capable hands.

Avatar
Christy Gren
Christy Gren is an Industry Specialist Reporter at Industry Leaders Magazine she enjoys writing about Unicorns, Silicon Valley, Startups, Business Leaders and Innovators. Her articles provide an insight about the Power Players in the field of Technology, Auto, Manufacturing, and F&B.

Recent Posts

Blackstone puts in an offer of $1.68 billion for St Modwen

Blackstone puts in an offer of $1.68 billion for St Modwen

Blackstone, the private equity firm, is planning to acquire St Modwen Properties, a logistics and housing developer, for £1.2bn ($1.68 billion) in a bid to take advantage of the P
2 days ago
Tesla to lose millions as Stellantis ends CO2 credit buying deal

Tesla to lose millions as Stellantis ends CO2 credit buying deal

Stellantis, the carmaker formed earlier this year by the merger of Fiat Chrysler and PSA, has revealed that it no longer needs to buy emission credits from Tesla, which will result
3 days ago
AB InBev CEO Brito to step down

AB InBev CEO Brito to step down

Anheuser-Busch InBev SA’s Chief Executive Officer Carlos Brito will step down from his role, effective July 1 and Michel Doukeris will succeed him as the new CEO. Brito, who beca
3 days ago
Australia’s Officeworks stops sales of Apple’s AirTags on child safety concerns

Australia’s Officeworks stops sales of Apple’s AirTags on child safety concerns

Officeworks, the Australian office supply store chain, has pulled Apple’s newly launched AirTags from its store following safety concerns for children from its button battery
4 days ago
Ex Google AI scientist joins Apple after resigning in protest for unfair practices

Ex Google AI scientist joins Apple after resigning in protest for unfair practices

Apple, Inc. has hired a former Google AI scientist who resigned in protest against the firing of two employees from the Ethics division. Sammy Bengio, the ex-Google employee, will
5 days ago
Solid Power raises $130 million in second funding round from Ford and BMW

Solid Power raises $130 million in second funding round from Ford and BMW

Solid Power, a solid-state battery system startup, has raised $130 million in Series B funding led by Ford Motor Company and BMW Group. The Louisville, Colorado-based SSB developer
5 days ago