Tea’s time up at Unilever

Unilever has set in motion a review of its global tea business as volume sales of black tea have been subdued in developed markets in 2019, affecting the brands such as PG Tips and Lipton Tea.

“We continued to focus on the growing segments of premium black tea, black tea in emerging markets and fruit and herbal variants, with our premium herbal brand Pukka performing well,” a statement read in the full year and quarterly results.

Chief executive Alan Jope said the business is now stepping up its drivers of growth via measures such as improving brand awareness and availability; implementing a more impactful innovation programme; and fuelling growth through cost savings.

In the foods and refreshment division, underlying sales grew 1.5%, with volumes down 0.2% and pricing of 1.7%.

Ice cream grew, however volumes declined due to a strong comparator from a particularly good European summer in the prior year.

Growth was supported by plant based and ‘better for you’ offerings, including Magnum vegan and Ben & Jerry’s lighter Moophoria variants.

In dressings, Hellmann’s grew, with the US business returning to growth in the second half of the year. The Hellmann’s vegan mayonnaise variant is now on shelves in over 20 countries while Sir Kensington’s premium ranges of mayonnaise and salad dressings have now more than doubled in size since the acquisition.

Price-led growth in savoury was supported by Knorr’s portfolio in scratch cooking and the launch of snacking ranges which address the convenience trend. Knorr launched the “Future 50 Foods” report in partnership with the WWF, highlighting the next generation of plant-based foods that can boost nutritional value whilst reducing environmental impact.

Newly acquired brand The Vegetarian Butcher entered a partnership with Burger King to offer the Rebel Whopper across 25 countries in Europe. Underlying operating margin decreased by 20bps driven by a reduction in gross margin