Unilever is expecting to announce adjusted earnings per share of £0.762, derived from sales over the first six months of the year of £24.41 billion, and resulting in £3.39 billion of pre-tax profit.
The press, over the last week, has focused on the fact that Tesco has dropped its CEO and replaced him with ex-Unilever man Dave Lewis. One firm’s gain is another’s loss.
More importantly, organic sales in emerging markets have struggled. This is especially important as emerging markets make up around 57% of the company’s total sales. Compounding the potential drop in sales of emerging markets by as much as 3.4% is the difficulty the company has faced in its currency exposure. The negative impact of the particularly strong pound could see as much as a 7.2% drain on the first-half figures from these regions.
Shares in Unilever have had a good run in the last couple of weeks as they have seen the price rise from £26, up to current levels just above £27. Year-to-date, the shares are up by 9% and currently the dividend yield is 3.76%, which explains why IG clients are 86% long of the company.