TAKING THE PULSE: Results from Europe's food producers are
expected to show an encouraging start to 2010, as they continue to
recover from the turbulence of recent years and show the benefit of
lower input costs.
The continued recovery in demand in mature markets will provide
the backdrop to updates from Europe's major food producers, with
emerging markets already performing well.
Analysts will look for evidence the recovery is sustainable,
while also noting the outlook for commodity costs. Falling
commodity costs in recent months have allowed consumer goods groups
to drive volume growth through increased marketing spend.
Danone's figures will be positive but overshadowed by the
upcoming European ruling on the health claims of two of its key
brands.
AB Foods' numbers will once again benefit from the inclusion of
its value retail chain Primark, while Nestle and Unilever are again
expected to outperform the market.
Tate & Lyle's results in May meanwhile will provide its new
CEO with an opportunity to unveil his strategy for the company.
COMPANIES TO WATCH
Groupe Danone (BN.FR) - Apr. 15 0530 GMT
MARKET EXPECTATIONS: As the first European food company to
report 1Q sales, Danone's figures will be an important indicator
for the entire sector. Revenue is seen at EUR3.91 billion for the
quarter, up 6.3%.
Given the continued improvement in economic conditions, analysts
expect Danone to post a good set of 1Q sales that are likely to be
ahead of consensus both in volume and organic growth terms, due to
a strong contribution from all units. Danone currently specializes
in four areas. Its largest division by sales is fresh dairy, which
includes the Activia and Actimel brands. Danone also has a bottled
water division, including the Evian brand, and medical and infant
nutrition operations.
MAIN FOCUS: Any updates on the application to the European Food
Safety Authority to obtain health claims for its important Activia
and Actimel brands will be keenly watched by investors. The
decision of the regulator is expected by the end of June and, if
positive, would be a major boost for the stock as Danone's strategy
has shifted towards differentiating its dairy brands as healthier
products which can command a higher price. In the meantime, the
uncertainty will continue to weigh on sentiment, analysts say.
Associated British Foods PLC (ABF.LN) - Apr. 20 0600 GMT
MARKET EXPECTATIONS: The U.K. food, ingredients and retail group
is expected to report pretax profit of GBP317 million for the first
half of its financial year after a strong performance across its
various businesses.
AB Foods said in February its profits in the first half would be
substantially higher than a year ago after sales rose across its
businesses. It forecast good revenue for the current year as its
investments of the last few years begin to bear fruit.
MAIN FOCUS: Profits are expected to benefit from a standout
performance from the company's retail chain Primark. First-half
sales at Primark grew 8% before new store openings and will be
further enhanced by an increase in retail selling space. Improved
weather since the February trading update may have strengthened its
performance, though stronger comparative numbers from last year
could dampen the figures in the second half.
Any news on more Spanish store openings will be welcomed, given
the strong performance of Primark in that territory.
Analysts will also be looking for rising margins at the grocery
business. Any reversal of the recent weakness in African sugar
producer Illovo will be welcomed, with the EU sugar business
expected to continue its strong growth.
Nestle S.A. (NESN.VX) - Apr. 22
MARKET EXPECTATIONS: The world's largest food and beverages
company in terms of sales continues to grapple with rising input
costs and slow demand in some markets, but its reach and an ability
to push through price increases will offset most of that.
First-quarter sales are expected to come in between 24.4 billion
Swiss francs ($23 billion) and CHF26 billion compared with CHF23.3
billion a year ago, adjusted for the disposal of Nestle's majority
stake in eye-care company Alcon Inc. (ACL). Nestle doesn't report
quarterly earnings.
MAIN FOCUS: Nestle has focused more clearly on its core business
through the divestment of its remaining 52% stake in Alcon to
Novartis AG (NVS), a deal expected to close in the third quarter.
Markets will therefore follow its food and beverages portfolio,
particularly its underperforming waters operations, even more
closely. The overall organic growth rate in the first quarter is
expected to be around 5% or 6%, in line with Nestle's long-term
target, after growth rates remained below that level during much of
2009. The company has remained vague on its 2010 outlook so far, so
any guidance upgrade would be welcomed.
Unilever PLC (UN, UL) - April. 29 0600 GMT
MARKET EXPECTATIONS: The Anglo-Dutch consumer goods giant
reports is expected to report a further rise in sales, margins and
volumes in the first quarter, as it continues to benefit from a
fall in input costs.
Sales before acquisitions, disposals and currency movements grew
1.8% in the fourth quarter of last year, following a 3.4% rise the
previous quarter.
Sales are expected to continue rising in the first three months
of 2010 as Chief Executive Paul Polman's focus on volume growth
continues to pay off. Volumes rose 5% in the fourth quarter.
MAIN FOCUS: The company is expected to continue benefiting from
the huge drop in commodity prices, which is allowing it to increase
investment in marketing while still growing sales and margins at
impressive levels.
This commodity cost deflation is expected to come to an end in
the second quarter however and analysts are keen to hear how CEO
Polman will grow volumes and margin when costs start to rise
again.
Analysts will also look for further signs of recovery in Europe
and reassurance on its U.S. performance. Any comments on price cuts
this year or possible cuts in marketing spend will also be
noted.
Unilever may also update on the integration of the Sara Lee
Personal Care business and the market is keen to hear updates on
possible disposals after recent reports that the Italian frozen
food business could be the next to be sold.
Tate & Lyle PLC (TATE.LN) - May 27 0600 GMT
MARKET EXPECTATIONS: The U.K. sugar and food-ingredients
producer is expected to report full-year pretax profit of GBP219
million, down from GBP247 million last year. The company warned in
January that profit would fall below last year's level after its
second half was hit by an increased pension charge and accounting
changes relating to a plant closure.
MAIN FOCUS: Few surprises are expected in the results given
T&L's trading update last month. Analysts will instead focus on
the company's outlook for the coming year. T&L indicated in
January that its 2010 sweetener pricing round in the Americas would
fall below the level achieved in the 2009 calendar year. The
pricing round is held every winter and determines prices for
T&L's sweeteners for the forthcoming year.
A strategy presentation by the new CEO Javed Ahmed will be
closely watched. He was named CEO in May 2009 but only took up his
position on Oct 1. He joined from Reckitt Benckiser PLC (RB.LN)
where he headed up the consumer goods group's European
division.
T&L has struggled for years to move away from
commodity-based products toward a more value-added position with
little success. Analysts are hopeful Ahmed will have the approach
to succeed.
Analysts will look for any signs of improvement in the company's
European sugar business, and the outlook for pricing for artificial
sweetener Sucralose. Sucralose, which trades under the name
Splenda, has delivered volume growth in recent months but at lower
average selling prices.
-By Michael Carolan, Dow Jones Newswires; +44 20 7842 9278;
michael.carolan@dowjones.com
(Elena Berton in Paris and Martin Gelnar in Zurich contributed
to this report.)
Unilever NV (NYSE:UN)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Unilever NV (NYSE:UN)
Historical Stock Chart
Von Jul 2023 bis Jul 2024