Wednesday 25 January 2017 3:10 pm

Unilever’s sales expected to unveil sagging European sales tomorrow

Food manufacturing giant Unilever is forecast to post an increase in global sales and profit when it reports its full-year results tomorrow, but analysts expect the company to reveal sagging growth in Europe.

Bernstein analysts expect profit before tax to come in at €7.58bn (£6.46bn), up from €7.22bn last year. They have forecast net sales of €52.98bn, with organic sales growing 4.1 per cent.

However, this increase will be dominated by growth in emerging markets, with sales up seven per cent in these regions. Sales in Europe are expected to fall 0.1 per cent.

Overall, prices are forecast to have grown by 2.8 per cent, driven by price rises in Latin America.

Andrew Wood, senior research analyst at Bernstein, said: "We believe Unilever can deliver strong and consistent operating performance in the medium-term, and we see further opportunities from Unilever's strategic evolution to a home and personal care company."

He gave the stock an "underperform" rating, with a target price of €49.50. It is currently trading around €39.00 on Euronext Amsterdam.

Unilever had a very public argument with the UK's biggest supermarket, Tesco, last year, when it tried to hike prices for its products by 10 per cent and Tesco refused to pay.

For a day, the nation feared Marmite and Ben and Jerry's ice cream would disappear from shops, after Unilever pulled its products from Tesco's website.

The two sides quickly came to an agreement, but what they actually decided remains a mystery. Tesco merely said the issue was resolved "to our satisfaction".