Unilever CEO warns of ‘volatile’ 2016

Unilever CEO warns of ‘volatile’ 2016

Unilever CEO Paul Polman has warned that 2016 is set to be a tough year.

The head of the Anglo-Dutch FMCG giant told The Financial Times: “We are preparing ourselves for tougher market conditions and high volatility in 2016, as world events in recent weeks have highlighted. Therefore it is vital that we drive agility and cost discipline across our business. We are further strengthening our innovation funnel while shortening innovation cycle times, stepping up our digital capabilities and rolling out a global zero based budgeting programme. Our priorities continue to be volume-driven growth ahead of our markets, steady improvement in core operating margin and strong cash flow.”

Tighter cost controls could impact on the FMCG giant’s marketing departments, according to a report published in The Drum, forcing them to formulate budgets from scratch every year, a strategy employed by Unilever in the past, and currently in operation at Coca Cola.

Unilever posted a sales increase of 4.9 percent for the final quarter of 2015, up from the estimated 4 percent, but almost a percentage point less than the growth enjoyed in the previous quarter. Underlying sales growth for the full year reached 4.1 percent, while net profit dipped 5 percent to €5.3 billion.