Shares in consumer goods giant Unilever were left on the shelf after the Anglo-Dutch company reported revenues below expectations and expressed worries over input costs and the global economy.
Turnover for the fourth quarter was €11.564bn, a rise of 6.9% against the same period of 2010. However, the market consensus had been for an 8.3% rise.
Underlying sales growth for the quarter came in at 6.6% with price increases accounting for 6.5% with volume only chipping in 0.1%. Unilever says volume growth was actually around 1% after adjusting for the impact of sales brought forward to the third quarter in advance of a supply chain upgrade in North America.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Nevertheless, the 6.6% figure was still below the consensus forecast of 6.8%, and this discrepancy appears to have really hurt Unilever shares.
In a conference call, the company's Chief Financial Officer, Jean-Marc Huet said the board "cannot recollect a more challenging year as 2011", perhaps giving a sense of the context of today's figures.
As for the full year numbers, earnings per share were up 4% at €1.41, again below the consensus estimate of €1.46.
Total turnover for 2011 was €46.5bn, up 5% on 2010 but below the market expectation of €50.3bn.
Operating profit came in at €6.433bn, up 1% on the year but well below expectations of €7.089bn.
Unilever is always among the biggest advertising spenders, and last year its total spend was €6bn, with more expected this year.
The London and Rotterdam based firm says it remains committed to doubling total sales, with the vast majority of that increase coming from expansion in developing markets.
Although Unilever clearly did not have a great 2011 sales growth in Asia and Africa was 10.5% over the whole year, while the Americas also impressed, growing sales at 6.3%. Europe, unsurprisingly, scraped along with growth of just 0.7%.
Looking ahead to 2012, Unilever's Chief Executive, Paul Polman, said: "We expect the external macro-economic environment to remain difficult in 2012 and input cost headwinds will persist, although to a lesser extent than in 2011."
Shares in Unilever were down 3.3% in London by 9:36am
BS
