Unilever has raised prices in response to soaring commodity costs linked to the Iran conflict, joining a wave of consumer goods firms passing on higher expenses to shoppers.
The company behind brands such as Dove soap and Lynx deodorant said prices had "stepped up" in the third quarter, with home and personal care products seeing particular increases.
Sales Growth and Price Impact
Underlying sales grew by 5.2% in the three months to September 30, of which 2.3% was due to higher prices. Fellow household goods firm Reckitt Benckiser also announced price increases on Tuesday, with prices rising by 4% across Europe in the third quarter amid higher inflation from the Middle East conflict.
Unilever said sales growth was not solely driven by higher prices, as it raised its outlook for volume-based sales growth, now expecting "at least" a 3% increase over 2026 as a whole, up from a previous forecast of around 3%.
Outlook and Food Business Split
The group now expects underlying sales growth of about 5% in the second half of the year, compared with earlier guidance of between 4% and 5%.
Chief executive Fernando Fernandez said: "We have delivered another quarter of competitive growth, led by continued strong volume delivery and a step-up in price to offset the impact of higher commodity costs."
Unilever is progressing with plans to split its food business into a joint venture with US rival McCormick. The £33.8 billion deal, announced in March, will combine brands such as Unilever's Marmite with McCormick's French's mustard.
Deal Progress
The company said it was on track for a "timely closing" of the deal, expected by mid-2027. "Separation and integration work is progressing well, led by dedicated project teams comprising more than 200 employees across 20 cross-functional teams," Unilever said.
"There has been strong progress on regulatory approvals, with filings submitted on schedule and clear momentum across jurisdictions, reinforcing our confidence in a timely closing."
