Unilever Results

[idpickering]

First half highlights

· Underlying sales growth excluding spreads 2.7% with volume 2.5% and price 0.2%

· Truckers' strike in Brazil adversely affected USG by around 60bps

· Emerging markets underlying sales growth 4.1% with volume 3.3% and price 0.8%

· Turnover decreased 5.0% including an adverse translational currency impact of (8.9)%

· Underlying operating margin up 80bps driven by increased gross margin and further reduced overheads

· Underlying earnings per share up 7.8% after a currency impact of (10.8)%, constant underlying EPS up 18.6%

Later;

The Boards have determined to pay a quarterly interim dividend for Q2 2018 at the following rates which are equivalent in value between the two companies at the rate of exchange applied under the terms of the Equalisation Agreement:


Per Unilever PLC ordinary share

£ 0.3435

Ex Div 2 Aug 18, paid 5 Sep 18.

https://www.investegate.co.uk/unilever- ... 00040928V/

[idpickering]

Further to the above, the Unilever CEO is being interviewed on Bloomberg TV at 0750hrs this morning.

Ian.

[Dod101]

These results sound good and the dividend appears to be showing an increase of around 10% if I am correct (34.35P against 31.55p) although I guess that depends on the exchange rate to some extent. Thanks Ian.

Dod

[idpickering]

These results sound good and the dividend appears to be showing an increase of around 10% if I am correct (34.35P against 31.55p) although I guess that depends on the exchange rate to some extent. Thanks Ian.

Dod

You're welcome Dod, and I agree with your assessment of the results. Not the highest of yielders I grant you, but I might just buy some more of this HYP mainstay (IMHO).

Ian.

[Gengulphus]

A fuller quote from these interim results:

The Boards have determined to pay a quarterly interim dividend for Q2 2018 at the following rates which are equivalent in value between the two companies at the rate of exchange applied under the terms of the Equalisation Agreement:

Per Unilever N.V. ordinary share € 0.3872

Per Unilever PLC ordinary share £ 0.3435

Per Unilever N.V. New York share US$ 0.4531

Per Unilever PLC American Depositary Receipt US$ 0.4531

The quarterly interim dividends have been determined in euros and converted into equivalent sterling and US dollar amounts using exchange rates issued by WM/Reuters on 17 July 2018.

And from last year's interim results:

The Boards have determined to pay a quarterly interim dividend for Q2 2017 at the following rates which are equivalent in value between the two companies at the rate of exchange applied under the terms of the Equalisation Agreement:

Per Unilever N.V. ordinary share: € 0.3585

Per Unilever PLC ordinary share: £ 0.3183

Per Unilever N.V. New York share: US$ 0.4140

Per Unilever PLC American Depositary Receipt: US$ 0.4140

The quarterly interim dividends have been determined in euros and converted into equivalent sterling and US dollar amounts using exchange rates issued by WM/Reuters on 18 July 2017.

So up from € 0.3585 to € 0.3872 in euros, the declaration currency - i.e. the board have declared a dividend increased by 8.0%. In sterling terms, up from £ 0.3183 to £ 0.3435, a 7.9% increase. So almost no exchange rate effect this time, and what little there is is against us, not in our favour.

Gengulphus

[Loudbarker]

"In sterling terms, up from £ 0.3183 to £ 0.3435, a 7.9% increase."


and who can complain about that?

LB

[Dod101]

This is a stalwart and I think should be in all portfolios as a great dependable. Obviously there is an immediate question about what will happen to the share price after the reconstruction goes through (which I expect it will) and it falls out of the FTSE but it will join something similar in Europe.

The underlying numbers are a little difficult to follow with the sale of the spreads business and the share buyback. All a little bit smoke and mirrors this year.

Dod

[Julian]

I like ULVR for many reasons but one maybe less obvious (and admittedly quite minor) one is the fact that it declares its dividends in all currencies at the same time. I find the long(ish) waits from the likes of BP and Shell between the declaration of the USD dividend and knowing what I'll actually get in GBP quite frustrating.

- Julian

[moorfield]

The year-on-year increase (Q3 2016 - Q2 2017 cf. Q3 2017 - Q2 2018) is 118.62p to 131.3p, +10.7%. A hold for me, but not a top up - I can find other stalwarts and dependables at better yields currently.

[IanTHughes]

Not a candidate for my HYP, the yield is too low for it to be considered


Ian

[vrdiver]

The year-on-year increase (Q3 2016 - Q2 2017 cf. Q3 2017 - Q2 2018) is 118.62p to 131.3p, +10.7%. A hold for me, but not a top up - I can find other stalwarts and dependables at better yields currently.

Looking at my spreadsheet, Unilever has delivered above inflation dividend increases for 10 years and a capital increase as well, giving a XIRR of nearly 16%.

The doubling of the capital value (in my holding) means the unremarkable yield has actually had to grow at quite a clip to remain "unremarkable" rather than "miserly". Its 5 and 10 year growth rates* have been 7.95% and 6.95% respectively, which considering inflation over the same period, seems pretty good.

For those trying to judge whether the Unilever dividend is "on sale", this resource might be helpful: https://www.dividenddata.co.uk/dividend ... ?epic=ULVR. I like to look at this (for whichever share I'm considering) as a guide to whether the dividend yield is likely to get better or worse (which implies lots of assumptions and caveats - please DYOR).

VRD


*https://www.dividenddata.co.uk/ftse-dividend-history.py?market=ftse100

[Dod101]

Thanks vrd. I also like the basis of the yield calculation, dividends paid for the last 12 months against current share price. That is how calculate my yields either for individual shares or a portfolio.

Dod

[Dod101]

Not a candidate for my HYP, the yield is too low for it to be considered

I would have expected that but do you not hold it anywhere? As vrd has shown, total return has been very acceptable over the last few years. As it happens it is in my HYP because I value the security of the dividend (famous last words, I don't think.)

Dod

[IanTHughes]

Not a candidate for my HYP, the yield is too low for it to be considered

I would have expected that but do you not hold it anywhere? As vrd has shown, total return has been very acceptable over the last few years. As it happens it is in my HYP because I value the security of the dividend (famous last words, I don't think.)

My HYP is my only portfolio of shares, I do not have any other portfolio

Since I started in 2012, Unilever Group (ULVR) has been at a yield of 3.5% or less, as far as I am aware. Every time I have funds available to invest there are a number of perfectly adequate HYP candidates with higher yields, sometimes much higher


Ian

[Breelander]

...So up from € 0.3585 to € 0.3872 in euros, the declaration currency - i.e. the board have declared a dividend increased by 8.0%. In sterling terms, up from £ 0.3183 to £ 0.3435, a 7.9% increase...

As Unilever's practice since 2010 has been to pay four equal quarterly dividends it's a fairly safe bet Q3 and Q4 will also be € 0.3585. The only unknown will be the exchange rate.

[StepOne]

I included Unilever in my HYP because I liked it enough to overlook a low-ish yield.

It's yield is still low (because its share price is up 80%), but in pound terms it is now delivering more to me each year than British Aerospace, British Land, Centrica, Glaxo, Pearson or Sainsburys, all of which were added to the portfolio at around the same time, 4/5 years ago.

The Unilever dividend has risen almost 50% in that time. For me it has been a successful inclusion (so far!)

StepOne

[Dod101]

Since I started in 2012, Unilever Group (ULVR) has been at a yield of 3.5% or less, as far as I am aware. Every time I have funds available to invest there are a number of perfectly adequate HYP candidates with higher yields, sometimes much higher

I do not want to start another controversial discussion but it seems a shame to be missing out on what is an excellent share simply because of a dedication to the (to me rather extreme) principles of a HYP. To me it is not just about income. I will take my money in the form of a total return if that seems fairly assured. I can always top slice my Unilever (in fact I should because it is now by a margin my largest holding) and buy another somewhat higher yielding share. I would agree that it is an 'honorary member' of my HYP and if I were desperate for income I would probably not hold it because I could get at least 50% more income if I bought any number of other shares. Maybe not the capital growth. Look at British Land for instance, or Glaxo or HSBC. There is quite a long list of good yielders with not much capital growth.

I think all UK investors should hold Unilever.

Dod

[idpickering]

I think all UK investors should hold Unilever.

I agree with you Dod. Furthermore, regarding the lowish yield one can glean from holding Unilever in a HYP, doesn't bother me, as I tend to look at the overall average yield that my HYP is producing. I hold Reckitt Benctiser too, however my average overall yield is in the mid 5% area. I think you have to have some shares that are the drivers of a HYP, and some stalwart non galloping elephants to balance the HYP out too.

Ian.

[Breelander]

I do not want to start another controversial discussion but it seems a shame to be missing out on what is an excellent share simply because of a dedication to the (to me rather extreme) principles of a HYP...

I don't want to argue either but I would just like to say those principles sometimes lead to picking up the likes of Unilever when the price vs. yield is right - and from then on say just hold on to it and ignore what the capital does . For me that time was in March 2011...

Name                              price (p)   Yield at Purchase
...
Unilever (ULVR)                   1830.69          3.9%

https://web.archive.org/web/20161111173 ... sort=whole (post #18218)

I think all UK investors should hold Unilever.

So do I.

[tjh290633]

I bought ULVR in February 2010 at 1915p, with the starting dividend yield being 3.72%. The dividend was €0.208 per quarter, 70.53p over 12 months. My IRR has been 13.6%, which is satisfactory.

ULVR is one of those shares which come into range from time to time. When it does, if one has the cash available, then it is time to pounce.

TJH