Unilever reported lower-than-expected fourth-quarter sales on Thursday, hurt by troubles in Latin America and weak growth in developed markets, showing the challenges facing new Chief Executive Alan Jope. 



The maker of Dove soap and Ben &amp; Jerry’s ice cream said fourth-quarter underlying sales rose 2.9 percent. Analysts, on average, were expecting 3.5 percent, a consensus forecast supplied by the company showed.



Jope, who has been with the company for more than three decades, took charge at the start of the year.



He succeeded Paul Polman, who retired after a decade as CEO during which he drove Unilever toward a vision of a company that valued sustainability as well as profits. The end of his tenure was marred by a dispute with shareholders over a botched attempt to shift the company’s main headquarters to the Netherlands.



Jope appeared focused for the moment on improving business trends at the Anglo-Dutch group, whose sales are at the bottom end of its medium-term targets, due to issues such as hyperinflation in Argentina, intense competition in North America and weak retail environments in France and Germany.



“Let me state &#8230; upfront, that accelerating quality growth will be my number one priority,” Jope told analysts.



Unilever shares fell nearly 3 percent as the sales miss overshadowed full-year earnings that were ahead of expectations.



“With growth weak but H2 margins strong, we expect this to fuel the ongoing debate on Unilever’s top line versus bottom line algorithm,” Jefferies analysts said.



<h4 class="wp-block-heading">CHALLENGING CONDITIONS</h4>



Unilever reported full-year sales growth of 3.1 percent, in line with its forecast for growth at the bottom end of its 3 to 5 percent forecast range.



Looking ahead, it said it expects 2019 market conditions to remain challenging and forecast underlying sales growth again in the lower half of a 3 to 5 percent range, with continued improvement in underlying operating margin and another year of strong free cash flow.



For the forecast to come up to the top half of the range, Jope said he would want to see a sustained turnaround in Latin America and continued improvement in Southeast Asia. Noting problems in Argentina and Brazil, he called Latin America the most troubled part of the world.



“Of course we’d prefer the top half of the range, but in the current uncertain market conditions &#8230; the lower half is where I expect us to be operating,” Jope said.



He noted also that the boost to sales growth the company had forecast from M&amp;A was being reduced by the poor performance in China of Blueair, a line of air purifiers it bought in 2016. The business doubled in size from the time of acquisition, but has since shrank back down to where it was.



<h4 class="wp-block-heading">NEW BOSS, SAME TARGETS</h4>



Jope has already embraced the 2020 targets Polman set for Unilever in the wake of 2017’s rebuffed $143 billion takeover bid by Kraft Heinz. The target calls for an operating margin of 20 percent.



He said on Thursday that Unilever remained on track for its 2020 goals.



“There’s nothing new about the intention, but so far at least the reality has failed to live up to it,” said analysts at RBC Capital Markets, referring to Jope’s stated focus on accelerating growth.



In the fourth quarter, Unilever blamed Argentina, which makes up 2.5 percent of its overall business, for hyperinflation that led prices to spike more than 50 percent and therefore volume to fall more than 20 percent.



Apple posts revenue drop but optimistic on China



But more broadly, sales volume in the Americas was flat. The same happened in Europe, though the company eked out 0.8 percent sales growth in the region. Overall, underlying sales in developed markets grew only 0.4 percent in the quarter.



The company blamed declines in France and competitive pressures in North America, particular in ice cream and mayonnaise.



For the full year, Unilever reported turnover of 49.6 billion euros ($57.05 billion), excluding its divested spreads business, with underlying sales up 3.1 percent, in line with expectations. Its full-year underlying earnings were 2.36 euros per share, topping analysts’ estimates of 2.31 per share. -Reuters



-Martinne Geller

LR1ECAD0MJ4QO

New Unilever CEO Inherits Disappointing Sales Performance

BOS co-founders Grant Rushmere and Richard Bowsher don’t sweat the small stuff. They like to think big. When they launched BOS Brands in 2010, their ambition was to conquer the $70 billion global ice tea market. They are well on the way.
It’s not a modest goal. The two businessmen are taking on some of the world’s biggest beverage houses that currently dominate the market—Coca Cola, Unilever, Nestea, Lipton—with an ice tea based on Rooibos, South Africa’s indigenous herbal tea.
<div id="attachment_2306" style="width: 221px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-2306" class="size-medium wp-image-2306" src="/wp-content/uploads/2017/04/000_DV1114614-211x300.jpg" alt="" width="211" height="300" />FBL-ENG-PR-MANUTD-STOKE</div>
Their dream became possible when two major investors trusted their vision. Former Manchester United football manager, Sir Alex Ferguson, was the company’s first major backer, taking a 10% stake in BOS even before it launched the first product.
It was a lucky break. Rushmere, who is friends with the South African wife of Ferguson’s son, Mark, had met the famous football boss several times socially. When Rushmere showed him the BOS prospectus on a trip to London, Ferguson immediately showed interest.
“We have been benefiting from Sir Alex’s amazing leadership capability since then. He brings a great venture capitalist perspective to the company and helps with investor analysis as well as optimizing the business model and cash flow,” says Bowsher.
A year later, venture capital firm Invenfin—the Remgro Group’s investment arm, which is chaired and controlled by well-known South African billionaire Johann Rupert—invested another 20% in BOS.
Rupert, who founded Switzerland-based luxury goods company Richemont that owns top global labels, including Cartier, Van Cleef &amp; Arpels and Montblanc, is the ideal partner to guide BOS in building its brand, says Rushmere.
“They are the ultimate godparents, if you like. They’ve gone out and done it and are very keen to help the next generation, without being pushy,” he says.
The fact that Invenfin approached them, and not the other way around, was a real coup for BOS.
“They are a big picture investor that is looking for global opportunities, headquartered in South Africa. And they have the track record and the war chest to back it,” says Bowsher.
Ferguson and Invenfin didn’t invest lightly. Their moves were carefully calculated.
The ice tea segment, which makes up 12% of the global soft drink market, is growing 8% annually and forecast to grow more than 40% over the next five years.
The idea to take on the global ice tea market with a Rooibos-based product came from Rushmere, who had already developed the Afro Coffee &amp; Tea brand.
“Rooibos’ natural sweetness makes it the ideal carrier for fruit flavors while its healthy, healing properties are increasingly recognized locally and internationally,” he says.
Another unique selling point was to create an authentically African product: the Rooibos plant only grows in a specific region within South Africa and nowhere else in the world.
<div id="attachment_2308" style="width: 310px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-2308" class="size-medium wp-image-2308" src="/wp-content/uploads/2017/04/bos-photos-full-12-1-300x200.jpg" alt="" width="300" height="200" />Richard Bowsher</div>
“There is, for example, a major trend for Asian green teas globally because people want the authenticity. The trend is to move away from generic brands,” says Rushmere.
In 2009, when a friend introduced him to Bowsher, who was farming organic Rooibos in the Cederberg mountains, about 300 kilometers north of Cape Town, the two decided to team up.
Apart from organic tea leaves, Bowsher, who built up an international media company in San Francisco with offices in the US, Tokyo and Britain before returning to South Africa in 2000, brought serious business skills and global experience to the table.
Rushmere, meanwhile, knew the European market well, where he had marketed his Afro Coffee &amp; Tea brand.
“We are quite used to beating Americans and Europeans at their game. We are not intimidated. We see Coca Cola, Unilever and Pepsi as direct competitors,” says Bowsher.
The two entrepreneurs certainly have chutzpah.
“When we launched the product, our goal was, from the start, to become a global beverages company. We have a distinct strategy and execution plan around how to do that,” Bowsher says.
In mid-2010, they went to market with a first range of BOS ice teas—five flavors—in South Africa. The beverage is organic and has no preservatives or colorants. Its contemporary branding made it stand out from other ice teas available.
“We want to show that healthy can be fun,” says Rushmere.
Within the first year, BOS distributed to over 1,200 outlets in South Africa, including major retailers Woolworths, Pick n Pay, Spar, Makro and Engen shops.
The next step was to launch different packs and sizes. BOS started selling a one-liter value pack in 2012, once they established a foothold in the retail environment, says Rushmere. In mid-2013, a re-sealable 500 milliliter plastic bottle was launched as an on-the-go convenience pack.
In November, BOS will take on the energy drink market by launching a Rooibos-based energy drink in three different flavors, taking on big names like Gatorade and Energade.
The global expansion is well under way too. Earlier this year, BOS started operations in Belgium and the Netherlands, as the first step of the company’s global expansion plan.
Although they are two geographically small countries, the move cannot be underestimated. The Benelux region is a $1 billion ice tea market where a person drinks on average ten liters of the beverage per year. That is massive compared to South Africa, where the average annual consumption per capita is below one liter.
“From there, our strategy is to expand further into Europe; to France, Italy, Germany and Spain, all massive ice tea markets,” says Rushmere.
“After that, we’ll tackle the world’s biggest ice tea markets, the United States, China and Japan.”
If all goes according to plan, South Africans will be able to cool down with a BOS ice tea when walking along the Great Wall of China in 2023.

Sir Alex Takes Tea In Africa

Herman Chinery-Hesse is piloting an orange Porsche sport utility vehicle around the hairpin bends leading up a mountain to his house in Aburi, in the misty hills just outside of Accra. “Put your seat belt on,” he warns, and screeches the tires.
These days, Chinery-Hesse’s racing hobby mirrors his life in the fast lane. He is the founder and CEO of SOFTtribe Limited, a company that provides business development software to African companies. On the Accra business scene, he’s known as the “Bill Gates of Ghana”—a title the 47-year-old shrugs off. The unabashed Pan-Africanist would likely prefer a Ghanaian nickname than one borrowed from an American software developer.
<div id="attachment_343" style="width: 484px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-343" class="size-large wp-image-343" src="/wp-content/uploads/2017/04/Bill-Gates-1024x757.jpg" alt="" width="474" height="350" />Herman Chinery-Hesse</div>
“Africa is it,” he says. “It’s the next big wave. It’s waiting for development—every place else is so saturated, and people are finally spotting it. And they’re coming to us.”
Chinery-Hesse’s goal is to ensure Africa doesn’t miss the global information technology (IT) boat. His client base includes Nestlé and Unilever, and he has a regional development partnership with Seattle-based technology pioneer Microsoft. But despite the influx of global companies coming into Africa, he says there’s not yet a homegrown technology brand name synonymous with the continent and hopes that his company, SOFTtribe, working from offices in an understated two-level house near Accra Airport, could be the first. The company has just launched what it calls a “virtual mall”: an online hub where you can buy everything from a cinema ticket to a sweater from Angola.
“We want an African Google, an African Facebook. And it’s possible,” he says.
Despite Africa’s weak technology infrastructure, Ghana, at an estimated 20%, boasts the highest penetration in the region. He sees more potential in Africa than any other technology market in the world.
“Africa is where the richest need is,” he says. “If we get even 1% or 2% of African companies to buy our products, we [will be the next] Google.
“You should be able to access Africa from wherever you are in the world,” says Chinery-Hesse, mentioning his company as being “the gateway, the highway. I want something stable that makes people money.”
At SOFTtribe’s headquarters, there’s a decidedly mellow vibe—in his trademark khakis, rubber sandals and bright button-up, Chinery-Hesse maintains the casual style of Silicon Valley. Staffers mill on the balcony and walls are adorned with large canvas paintings of the beach.
On a recent day, the boss was in his favored work position—lying down on the sofa, four computers humming on the nearby desk. He dictated to his Hong Kong-educated Ethiopian assistant as she typed on a small pink laptop.
Chinery-Hesse paused to answer calls on his wireless mobile headpiece, a confusing move that causes his colleagues to joke: “Is he still talking to me?”
The space to sprawl is an achievement for Chinery-Hesse. When he first founded SOFTtribe in 1991, its programmers sat side-by-side in an outhouse—remodelled as a cramped office—behind his parents’ house in the same neighborhood.
“We were doing an international contract with Nestlé’s head office, and we would say ‘don’t come visit’ because they wouldn’t believe that this [cutting-edge software] was coming from the bush.”
A few years later, when the team had swelled to 28 people, Chinery-Hesse, unable to afford rent on the kind of space he needed, bought a freight container and piled in his operation. It housed the entire team and two air-conditioners for six years.
Today, from the comfort of its new home, the company is expanding at a clip that rivals one of the orange Porsche’s tight turns. By providing the internet bandwidth, hosting and software development capabilities to African companies—and the regional branches of multinationals—it has amassed more than 250 clients.
Chinery-Hesse is an unabashed Africa enthusiast who hopes to use technology and the internet to aid the wide spectrum of African business, from the Ford Foundation to a craftsman in Mali looking to sell his work overseas.
“We help clients with delivery, logistics; we make sure the merchandise is working. A lot of the time, we’re dealing with ordinary folks who may just have a mobile phone. We’re hand-holding,” he says. “My team is from everywhere—here, Ethiopia, Kenya. We see Ghana as a springboard to expand further into Africa.”
He speaks from experience—his home country provided the springboard for his own ambitions.
Born in Dublin, Herman’s mother is Dr Mary Chinery-Hesse, the former deputy director general of the International Labor Organization and the vice chairman of Ghana’s National Development Planning Commission. Her son was schooled in both Ghana and the United Kingdom and attended Texas Tech University, where, with the first computer boom underway, he discovered a talent for software coding.
Ever the pragmatist, he began his professional life as an engineer at a UK plasterboard manufacturer.
“If everything went wrong, I’d have a fallback,” he says.
The pay packet from the plasterboard manufacturer helped buy a computer costing 800 British pounds, and Chinery-Hesse began tinkering with it at home. At work, bosses took note of Chinery-Hesse’s interest in technology, and his American education, and moved him from mechanical to computer engineering.
Returning home for Christmas in the late 1980s, inspiration struck in an unlikely spot – an Accra nightclub, where friends were complaining that they didn’t have jobs.
“I made a 100 pound bet that I could find a job here by Monday morning,” he says. “Monday I woke up, jobless, and said ‘ouch.’ Then I remembered I had done programming in the UK, went onto the street, found a travel agent with a broken computer, fixed it, and…”—as word of mouth spread in a society that knew next to nothing about technology—“… I was inundated with offers.” A few years later, he founded SOFTtribe.
If the company’s original hurdle was to introduce software to a nation that didn’t know what it was, today its challenge is a bit more complex—figuring out how to incorporate traditional software with the growing influence of the internet.
In a sign he’s been successfully able to navigate Web 2.0, Chinery-Hesse was invited to speak at tech conference TEDGlobal in Tanzania in 2007, where he introduced SOFTtribe’s most advanced venture, Black Star Line (BSL), an e-commerce business which coordinates trade carried out via mobile phones and the internet, a model “combining transaction brokerage and a virtual marketplace”.
Funded by an angel investor, it’s a system of technology that’s a cross between eBay and PayPal, both of which are scarce in Africa, but are booming in the US, Europe and Asia.
“Africa can’t trade with the world, hence our poverty,” he says. But before it can open its gates to the world, the tech czar would like to see a businessman in his country transact with someone in Nigeria or the Congo or Malawi—without the usual red tape. “We can use technology to bypass borders and bureaucracy and unleash inter-Africa trade,” he says, “where someone in Kenya would be able to buy something from a man in Ghana.”
SOFTtribe is being recognized globally. The TED platform was a sign of acceptance from the international tech community, as were invitations to speak at the US’s top two business schools, Wharton and Harvard, and at Cambridge in the UK.
Chinery-Hesse’s profile in Ghana continues to rise; he is currently an Assessor at Ghana’s Commercial Court and his homes—and office balcony—are more popular among Ghana’s elite than nightclubs.
On a misty September night at his weekend home in Aburi, the deck was filled with the usual motley crew—business associates, locals, friends in from London. Everyone drank good wine. Mist swirled in the distance. Someone asked about road directions, inciting a spirited discussion. Chinery-Hesse, of course, was ready with the only answer that made sense—maps, after all, are for a world before technology.
“Use GPS,” he said, and the discussion was over.

Tag: Unilever

FORBES AFRICA SOCIAL MEDIA

New Unilever CEO Inherits Disappointing Sales Performance

Sir Alex Takes Tea In Africa

Life In The Fast Lane With The Bill Gates Of Ghana