Unilever Plc, A Key FTSE 100 Stock That Went Ex-dividend On October 31, 2019

  • Nov 01, 2019 GMT
  • Team Kalkine
Unilever Plc, A Key FTSE 100 Stock That Went Ex-dividend On October 31, 2019

Unilever Plc (ULVR) is a global company selling fast-moving consumer goods, with two home countries: the Netherlands and the United Kingdom. The company is engaged in the production and marketing of a variety of products from different categories such as home care, food, health, beverages and wellbeing. The company has divided its operations into three reportable segments being Foods & Refreshment, Home Care and Beauty & Personal Care. As on August 11, 1939, shares of the Unilever Plc were admitted to the main market of the London Stock Exchange for trading. Its shares are a key constituent of the UK's broader gauges like FTSE 100, FTSE 350 and FTSE Eurotop 300, respectively.

The outstanding market capitalisation of the group stood at £125.03bn, with 2.71bn shares are in issue and ranks it among the large-cap companies listed on the London Bourse.

Dividend

In the third quarter of FY19, the group declared a quarterly dividend of GBX 35.67 per share, which went ex-dividend on October 31, 2019, record date scheduled on November 01, 2019 and the dividend would be paid on December 04, 2019. However, Q3FY19 dividend was approximately 2.8% lower against the previous quarter, but 5.4% higher against GBX 33.61 declared for the corresponding quarter of the previous financial year. The group has a track record of consistent dividend pay-out for the last five years.

Trading Update-Q3FY19

As on October 17, 2019, the group reported its trading update for the third quarter of the FY19. During the quarter under consideration, underlying sales growth increased by 2.9% against the corresponding period of the previous financial year, driven by emerging markets underlying sales growth of 5.1% with volume up by 2.2% and price rising by 2.8%, respectively. Turnover surged by 5.8% to €13.3bn, including 2.3% positive impact from foreign exchange and 0.8% from the acquisition.

However, the group witnessed lower growth in Europe and North America, while South East markets continued to grow well, whilst South East Asian markets performed well, and growth in India narrowed further, and China business declined marginally. The economic environment in Latin America remains difficult.

Segment Performance

During the period under review, the group’s Beauty and Personal care sales improved by 2.8%, benefited by 2.1% growth from volume and 0.7% from price growth. Within the segment, Deodorants vertical reported decent growth, and Skin cleansing witnessed modest growth.

Home Care segment sales improved by 5.4%, with 3.2% growth came from volume growth and rest 2.1% came from price growth, driven by the decent performance of home and hygiene products.

Food and Refreshment vertical grew marginally against the corresponding quarter of the previous financial year, with the majority coming from price growth of 1.9%, but partially offset by 0.2% decline in the volume.

Geographical Performance

Asia/AMET/RUB

In the Q3FY19, the group's underlying sales in the Asia/AMET/RUB surged by 5.6%, with 3.1% of the total growth coming from volume surge and 2.5% coming from price growth. Driven by the decent performance of the group in South East Asia, with Indonesia, Vietnam and the Philippines performing well across the divisions. However, growth declined further in India, but despite this, South East Asia was strong and performed ahead of the market. Meanwhile, sales in Turkey and the Middle East grew with a double-digit number, while Africa witnessed a challenging quarter amid volatile economic conditions.

America The group’s performance in North America was positive, led by favourable price movement and improved momentum in food and Refreshment. Beauty and Personal care skincare segment performed well; however, growth was partially hampered by a contraction in the hair care business. Seventh generation and e-commerce channel performed firmly.

In Latin America, underlying sales increased by 3.2%; however, Argentina and Venezuela remained under hyperinflationary pressure, and price growth was capped as per nee definitions. The group experienced moderate momentum improvement in Brazil.

Europe

Europe declined 0.3% with volumes up 0.5%, and price slumped by 0.9% in a retail environment that remains challenging throughout the period. Eastern Europe performed well across all segments, and the group experienced decent growth in Italy helped by purpose-led activations while the decline in Germany slowed. Ice cream volumes were down against the previous year.

Price Performance

In the year-over period, shares of the Unilever Plc have delivered a price return of approximately 11.27% to its respective shareholders, up around 13.23% on a year-to-date basis though it plummeted 7.68% in the past three years and were down by approximately 5% in the past one month. In the year-ago period, its shares have registered a 52w high of GBX 5,333.0 and a 52w low of 3,904.94 and the at the time of writing, as on November 01, 2019, before the market close, its shares traded 10 points or 0.22% higher at GBX 4,632.50 and at the current trading level its shares traded 15.1% off those 52w high and were 18.6% higher from 52w low price level and the dividend yield of the group stood at 3.04%.

At the current trading level, shares of the ULVR traded above its short-term and long-term support level of 50-day and 200-day simple moving average (SMA) prices. The Moving Average Convergence Divergence is rising, and MACD line is hovering well above its 9-day EMA, with 12-day exponential moving average (EMA) quoted above the 26-day exponential moving average. Also, the 14-day Relative Strength Index of the stock was hovering in the neutral zone.

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