|Bid||4,307.00 x 0|
|Ask||4,310.00 x 0|
|Day's Range||4,293.00 - 4,361.14|
|52 Week Range||3,583.50 - 5,333.00|
|Beta (5Y Monthly)||0.44|
|PE Ratio (TTM)||17.08|
|Earnings Date||Jul. 23, 2020|
|Forward Dividend & Yield||1.45 (3.34%)|
|Ex-Dividend Date||May 14, 2020|
|1y Target Est||45.13|
In partnership with Unilever’s United for America initiative, The North Texas Food Bank (NTFB), will be distributing kitted food boxes through a low-touch distribution model on May 21, 2020. Distribution will be on a first-come, first-serve basis.
The summer travel season is a big revenue generator for U.S. airlines but the coronavirus threatens the carriers and risk assessment firm RapidRatings warns American Airlines is the most at risk of going bankrupt.
As part of its United for America initiative, Unilever is hosting its first annual Day of Service on May 21. The company will donate the equivalent of one day’s worth of the products manufactured at its U.S. factories to Feeding America and Direct Relief, employees will spend time virtually volunteering, and a network of 70 partners will join in relief efforts to support their communities.
(Bloomberg Opinion) -- With first-quarter earnings mostly in the books, investors have now gotten their first detailed glimpse of how the coronavirus pandemic has affected profits in corporate America. To no one’s surprise, the results as a whole weren’t good: Earnings fell about 14% from a year earlier for members of the S&P 500 Index, according to DataTrek Research. Wall Street analysts expect things to get worse before they get better, with earnings forecast to plunge about 41% in the second quarter, decline 24% in the third quarter and drop 11% in the final three months of the year. Add them up and Wall Street forecasts a 20% tumble for the year to $127 a share. Coming into 2020, the consensus was that members of the S&P 500 would produce earnings of about $175 a share. But that’s the mile-high view. For a real sense of the challenges facing the economy, it helps to get as granular as possible. To that end, we’ve asked those Bloomberg Opinion columnists that focus on business and finance to provide their thoughts on the quarter that snapped the longest U.S. economic expansion in history, revealing the winners and losers, highlighting interesting tidbits and musing about what may lie ahead.Bankers are the good guys? The message from the largest U.S. banks as they released their earnings in mid-April, just as the pandemic was escalating across America? We are well-capitalized, made a lot of money from trading in extremely volatile markets, and have the capacity to help our clients get through the crisis. Unlike the financial crisis just over a decade ago, big banks have a chance to be the good guys now, processing U.S. Small Business Administration loans and allowing individuals and families to delay payments on credit cards, auto loans and mortgages in certain cases. Yet banks have been among the biggest laggards across U.S. stock markets. The KBW Bank Index has fallen about 42% this year, compared with just 12% for the S&P 500, suggesting the economic recovery might be slower and more punishing than the broader markets for equities may be signaling. —Brian ChappattaCable conundrums, streaming dreams. The absence of lucrative sports programming and muted advertiser demand has forced traditional cable-network operators to make an even bigger push into the rocky terrain of streaming, where revenue is entirely dependent on must-see content continuously propelling subscriptions. AT&T Inc. said total ad sales fell 13%, while Walt Disney Co. said ESPN alone suffered an 8% drop. Meanwhile, almost 16 million people signed up for Netflix and about 2 million canceled cable TV. —Tara LachapelleGorging on comfort food. As panic-ridden consumers stock up on essentials, Big Food brands of yesteryear, from Kellogg’s Frosted Flakes to Kraft macaroni and cheese, that had been struggling to find their place in a new health-conscious society suddenly had a moment. This explains the resurgence of companies such as General Mills Inc., whose brands include Betty Crocker, Pillsbury and Totino’s pizza rolls. Its U.S. retail sales surged 45% in March and 32% in April. The question: Is this only a moment? We’re also noticing some quirky consumer habits. Unilever NV said we are using less deodorant, skin care and shampoo, as much of this use is associated with work and socializing. Henkel AG enjoyed strong demand for home hair coloring. If the recession is a long one, expect these habits to continue. —Tara Lachapelle and Andrea FelstedAmazon isn’t alone. E-commerce giant Amazon.com Inc.’s sales increased 26% in the quarter, and the company forecast up to 28% growth for its April-through-June quarter as nationwide lockdowns sparked a surge in online shopping. But overwhelming demand and shortages are giving its rivals opportunities as consumers increasingly shop elsewhere. It's showing up in the latest metrics from Shopify Inc.'s merchants, as well as Wayfair Inc., Best Buy Co., Target Corp. and Costco Wholesale Corp. — all pointing to much faster online sales growth rates than the tech giant. —Tae KimBig Tech divergence. Shares of Facebook Inc. and Google parent Alphabet Inc. rose post-earnings following better-than-feared commentary on April digital ad market trends. Even so, Facebook cautioned the future economic recovery may be worse than expected. And Google said not to extrapolate the stabilization that seemed to occur in April. Both internet ad giants may face business pressures going forward if companies cut their marketing budgets in coming quarters. In contrast, Amazon and Netflix are thriving as consumers increasingly shift spending to e-commerce and watch more streaming video content. Finally, Apple Inc. uncharacteristically failed to give sales guidance for its current quarter for the first time since 2003, signaling the lack of visibility it has for iPhone demand. —Tae KimCovid-time tech winners. Best-of-breed cloud software makers are surging as companies accelerate the spending shift away from traditional on-premise equipment to the cloud's more scalable and cost-efficient offerings. Some of the biggest earnings winners included Datadog Inc., Okta Inc. and Twilio Inc. Video-game stocks are one of the hottest-performing subsectors this year as it has become a key in-home entertainment choice under shelter-in-place orders. Both Activision Blizzard Inc. and Electronic Arts Inc. posted strong results and confirmed accelerating sales for its offerings in April. Investors also bid up Zoom Video Communications and Slack shares as the two companies benefited from the workforce-collaboration software trend and revealed strong accelerating business metrics. —Tae KimPharma unfazed, for now. As a wide variety of industries panicked and cut profit targets, large drugmakers broadly reaffirmed guidance in the first quarter. Merck & Co., which makes many hospital- and physician-administered treatments, was the only big firm to slash its drug sales forecast seriously. Making medicine is a durable business, even in a pandemic. However, if a strong second-half economic recovery doesn't materialize, more companies may follow Merck as patients make the tough decision to stay home instead of venturing out and seeking treatments. —Max NisenCover me. Large health insurers were also relatively sanguine, despite a pandemic that would seemingly spark increased claims. They believe that the dive in expensive elective surgeries will balance out adverse effects. That doesn't mean there won't be change. UnitedHealth Group Inc. announced this month that it plans to re-enter Obamacare's insurance markets after mostly exiting four years ago. A 14% unemployment rate will do that. Watch for imitators. —Max NisenCashing in on Covid cures? During Gilead Sciences Inc.’s first-quarter earnings call, an analyst asked CEO Daniel O'Day if investors should expect the sort of attractive returns from newly confirmed Covid treatment remdesivir that the company produces for other drugs. O'Day responded that "there's been no other time like this in the history of the planet" and that "we understand our responsibility." In other words, probably not. Gilead announced on Tuesday a temporary royalty-free license that will allow five generic drugmakers to make a presumably cheaper version for more than 100 low-income nations. Other companies will face pressure to follow its example and price moderately in developed countries, which calls into question the soaring valuations for pandemic-focused drugmakers. —Max NisenGoing local. Still spending. Coronavirus shutdowns have snarled industrial-supply chains already facing strain from the U.S.-China trade war. While no one envisions an abandonment of China as a manufacturing hub, there are early signs of work being brought back to the U.S. Unfortunately, this is unlikely to mean much in terms of jobs, at least not for humans. Rockwell Automation Inc. said it's seen an uptick in interest from companies that might have previously manufactured products out of Asia to take advantage of low wages but are now rethinking that economic calculus. When it comes to investment, discretionary spending on things like travel has been cut across the board at many manufacturers. Most CEOs and top executives have taken pay cuts. Buybacks are off the table but for a few brave souls, including Eaton Corp. But many manufacturers are continuing to fund projects they view as essential to their future growth. For United Parcel Service Inc., that means investments in automation that can help make e-commerce deliveries more profitable. For Caterpillar Inc., that's services work and expanding its product lineup. "I'm not planning on sacrificing the future just to cut back on capex," Honeywell International Inc. CEO Darius Adamczyk said on a recent earnings call. —Brooke SutherlandPink slips or paychecks? While aerospace manufacturers such as Boeing Co. and General Electric Co. have moved swiftly to announce large layoffs amid a collapse in the industry, other industrial companies have been more surgical, at least for now. Caterpillar CEO Jim Umpleby has said his company's efforts to hold headcount relatively flat even as revenue climbed the past few years means there's less slack in the system and the company doesn't have to be as ruthless on job cuts during the pandemic. Others, such as railroad Union Pacific Corp., are worried about having enough labor at the ready whenever a recovery does occur so prefer furloughs when possible. "We don't want to cut the talent so deep that when the recovery happens, we don't have the right people," said Greg Hayes, CEO of Raytheon Technologies Corp., whose robust balance sheet and defense business give it more flexibility to weather the commercial aerospace downturn. Companies can still save costs without cutting employees: Trash-hauler Waste Management Inc. is guaranteeing 40 hours a week of pay for full-time employees through the pandemic, but the redistribution of its workers has helped it reduce more costly overtime hours by half. —Brooke SutherlandStaying safe. Most manufacturers have kept their doors open through the pandemic because their work is considered essential. That has come at a cost: Trash-hauler Republic Services Inc. spent $3 million in the first quarter on actions to keep its employees safe, including providing them with protective gear and doing enhanced cleaning. To keep Emerson Electric Co.'s factories humming, Chief Operating Officer Steve Pelch had to rent aircraft to bring in crucial supplies and double the number of buses used to transport workers in Mexico so they can safely spread out, according to an interview with Bloomberg News's Thomas Black. Automated doors have been installed, as have hand-washing stations. Plexiglass partitions separate workers on the factory floor. Siemens AG digitally redesigned an Airbus SE factory that's been repurposed for ventilator manufacturing to ensure social distancing, and workers must pass through a sanitization tent to gain access. In what could be a key test for the reopening of other parts of the economy, automakers with large union workforces including General Motors Co. and Ford Motors Co. are bringing their factories back to life this week in preparation for a May 18 official restart. Ford said it will require face masks for anyone entering its facilities, as well as safety glasses with side or face shields for those employees whose jobs don't allow for social distancing. It's spacing out production shifts to allow more time for cleaning and requiring employees to complete daily health and temperature checks. —Brooke SutherlandOil, oil everywhere. At a primeval level, the oil business is all about sinking money into the ground. When the barrel gods are smiling, even more money comes back up. In 2020, it feels like the gods aren’t happy. Hence, earnings season for oil companies was odd. While exploration and production companies are always careful to talk up efficiency, what really gets the juices flowing are spending plans for new wells. Not this time. Parsley Energy Inc., which fracks in America’s oil heartland, the Permian basin, suspended drilling, declaring bluntly (and correctly) that right now, “the world does not need more of our product.” At the other end of the scale, Exxon Mobil Corp. also slashed spending this year to as little as — get ready for it — $23 billion! While Exxon recognizes the immediate impact of Covid-19, it doesn’t think “events like this change basic human nature or people's wants and desires.” The jury remains out on that notion. And in any case, the switch from budget boasting to public prudence offers a glimpse of what peak oil could mean for what’s ahead. Expect dissonance. —Liam DenningThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Beth Williams is a managing editor with Bloomberg Opinion. She has also worked at Bloomberg News as an editor and reporter covering M&A, markets, companies, finance and government.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Uber Technologies Inc. outlined new safety procedures at a virtual event on Wednesday, a move aimed to inspire more drivers and riders to feel comfortable getting in a shared car again.The rules will require drivers, passengers and food delivery couriers to wear face masks as cities begin to reopen across the U.S. After the Covid-19 pandemic began spreading rapidly more than two months ago in the U.S., Uber urged riders to stay home and shuttered its carpool service completely. Drivers were often conflicted about continuing to pick up the few remaining passengers or putting their health at risk.The Centers for Disease Control and Prevention has recommended wearing face coverings in public since April 3 to prevent the spread of the virus. But masks have become a polarizing sign. Some people believe they aren’t necessary and that the economic effects of the lockdowns outweigh the health risks. President Donald Trump has long defended his decision to not wear a mask, helping to fuel an anti-mask movement across the U.S. that has spurred protests, fights and at least one fatal shooting.Uber will also ask drivers to submit a selfie showing them wearing a mask. Drivers who refuse the verification in the U.S., Canada, India and most of Europe and Latin America will not be able to go online beginning May 18.“We’ve designed this feature to adapt to changing public health guidance and regulations as the pandemic evolves,” Uber Chief Executive Officer Dara Khosrowshahi said in a blog post. The mask policy will remain in effect through June and be reassessed based on local public health needs. The global pandemic has been taken a toll on Uber’s ride-hailing business, with rides down about 80% globally in April. As a result, Uber announced cost-cutting measures last week, including ending food delivery operations in seven countries and trimming 14% of its workforce. But Uber’s food delivery service, Uber Eats, has fared better as homebound people order more takeout. Uber has approached Grubhub Inc. about a takeover, according to people familiar with the situation, a move that could combine two of the largest food-delivery services in the U.S. The proposed deal is already facing resistance from officials, who said Uber has failed to set up adequate safety measures to mitigate the risk of infection for drivers.Under the new rules, riders will also need to confirm they’ve taken precautions, including wearing a mask and washing their hands, and must agree to sit in the back seat and open windows for ventilation. Uber is also reducing the maximum suggested number of passengers for an UberX ride to 3 from 4. Drivers will be able to cancel a trip without penalty if they don’t feel safe, including if the rider isn't wearing a face mask.Other efforts Uber is making to keep drivers and passengers safe include allocating $50 million to purchase supplies like masks, disinfectant sprays and wipes, hand sanitizer, and gloves. As of this week, Uber has obtained more than 23million masks for drivers and delivery people around the world, the company said. Uber also announced two new partnerships, with Clorox Co. and Unilever Plc, to provide disinfecting tips and hygiene kits for drivers and delivery people in some markets. For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The international exposure of Unilever may be tempting for investors, but P&G; is better equipped to withstand today's coronavirus-related headwinds.
Invests US$6 million in two companies in India and Indonesia that recycle local plastic waste into useful products Singapore, Singapore--(Newsfile Corp. - April 28, 2020) - Circulate Capital, the Singapore-based investment management company focused on advancing the circular economy, today announced that the Circulate Capital Ocean Fund (CCOF), the world's first investment fund dedicated to the ocean plastic crisis in South and Southeast Asia, has made its inaugural investments in two plastic recycling companies ...
(Bloomberg Opinion) -- In a locked down world, cat food is in, but deodorant is out. How consumers adapt to pandemic life is playing out in the contrasting performances of two big consumer goods companies: Nestle SA and Unilever.Nestle, which has been fine-tuning its focus on food, on Friday posted its highest rate of growth for almost five years, with a 4.3% increase in first-quarter sales excluding currency movements, acquisitions and disposals. That far outstripped the showing at Unilever, which didn’t manage any sales expansion in the first quarter despite demand for disinfectant soaring.Food is usually the sleepy cousin of faster-growing personal-care products, such as skin creams and shampoo. However, the Covid-19 crisis has turned this on its head.Nestle, which generated about 15% of its sales from pet care in 2019, has doubly benefited from an embrace of our furry friends in this unsettling time. Not only did people panic buy for their cats and dogs, but they’re pampering them more now that they’re spending more time with them. Pet food sales helped Nestle’s overall organic sales growth increase by more than 7% in both the Americas and Europe.By contrast, Americans and Europeans are spending less time worrying about their own appearance, be it tinkering with their hair, shaving or applying makeup and moisturizer. With nowhere to go, the change in behavior is so radical that, according to Unilever, a typical day stuck at home entails on average 11 fewer “personal care moments.”That’s a big problem for Unilever. The company generates 42% of sales from its beauty and personal-care brands, such as Dove moisturizers and Timotei shampoo. And it’s absent from some categories that have been performing well, such as hair dye for use at home.But this isn’t just the corporate equivalent of being in the right place at the right time.Nestle’s chief executive officer, Mark Schneider, has made some canny changes to the Swiss firm’s portfolio, which includes coffee, bottled water and frozen food. Of course, no one had a crystal ball, but those decisions now look prescient. The company sold a skin-health business that makes Botox, which looks very wise now that nobody can get to the beauty salon. It completed the sale of its U.S. ice cream business at the end of January, so it didn’t suffer as much Unilever from the decline in demand in this category. Nestle has really scored from its $7 billion deal two years ago for the right to sell Starbucks products outside of cafes. The pandemic has turned people into their own baristas forcing them to stock up on coffee at the supermarket. Schneider is continuing to reshape Nestle, with a strategic review of the Yinlu business that makes traditional Chinese porridge and peanut milk.Change at Unilever hasn’t been as dramatic. The Anglo-Dutch company has made small bolt-on acquisitions in what have been fast-growing categories such as plant-based meat and premium beauty products like Hourglass cosmetics. This is sensible given long-term trends, but these products are facing headwinds right now. For example, a large proportion of the company’s beauty offerings are sold through North American retailers such as Ulta Beauty Inc., which are currently closed.Now led by company veteran Alan Jope, Unilever has also been more reticent about big disposals. It sold its spreads business in 2017, and is reviewing its tea division, which includes brands such as PG Tips and Lipton.Investors certainly seem to be backing Schneider’s approach over that of Jope. On a price-to-earnings basis, Unilever is at its biggest discount to Nestle for more than a decade.How Unilever performs during the crisis should spur a rethink of the portfolio. The company is well placed in one sense with many of its brands in the mass-market segment. In the downturn that will inevitably follow the pandemic consumers will trade down. But some brands also look tired. Will a large number of people really turn to Brut aftershave and V05 shampoo or Toni&Guy when supermarkets and discount retailers do a good job in cheaper alternatives?Home workers using less deodorant isn’t just an issue for those sharing a lockdown space.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
As part of Unilever’s ‘United for America’ initiative, Hellmann’s today launched a Food Relief Fund that will provide $1 million to feed frontline workers and people in need in New York City, Hellmann’s birth place and the current Coronavirus (COVID-19) pandemic epicenter.
(Bloomberg) -- Shaking hands has a publicity problem -- so does walking through crowds, attending a concert and passing out high fives.Scenes like these are disappearing from advertisements as companies come to grips with public health orders to self isolate and limit the spread of the novel coronavirus pandemic. Ads that were in the works have been shelved and campaigns have to be reworked on a short timeline. Travel and hospitality companies have gone quiet. Meanwhile, with so much of the world on lockdown, it’s not exactly easy to shoot new commercials.“You have to ask what meaning does your commercial have right now, given that everything has changed in the immediate realities of life,” said Mark Lund, chief executive officer of McCann Worldgroup U.K. “How do you avoid that tone deafness which might offend and alienate people?”The U.K. advertising regulator said it got 163 complaints about a KFC television ad in March which featured people licking their fingers. Complaints said it was irresponsibly encouraging unsanitary behavior, according to a spokesperson for the Advertising Standards Authority. When the agency contacted the fried-chicken fast food chain, whose longtime slogan is “Finger lickin’ good,” the company had already decided to pull the ads.Unilever Plc suspended its “Unstoppable” campaign for Domestos, including a video ad that said the toilet cleaner kills germs that are “hiding, breeding, infecting the weak.”Getting InventiveIn addition to new sensitivities around hygiene, advertisers are having to cope with limited resources to make new commercials as production crews and actors self-isolate.“World War II comes to advertising land. What can you make out of this empty washing-up-liquid bottle and a bit of sticky-back plastic?” said Emma de la Fosse, chief creative officer of Digitas Inc.’s U.K. business. “It’s about being inventive.”A cookie brand that Digitas works with had to pivot quickly from a campaign about going out to one about staying in and staying safe, she said. Agencies are getting creative with footage that’s already been shot, and they’re looking at user-generated content and social-media influencers, though the quality can be hit-and-miss, Fosse said.Lund said that McCann has done an ad for grocery store Aldi using existing footage and resurrecting an animated carrot from its Christmas campaign telling shoppers to “go easy” on the vegetables.As the lockdown drags on, advertisers will also have to make the decision about whether to make a bigger pivot on campaigns, such as commissioning more animation and using computer-generated imagery that can be produced by teams of graphic designers, art directors and 3D modelers working from home.“The likelihood is things will take a bit longer, but there is no creative compromise,” said Mark Benson, CEO of global creative ad studio Moving Picture Company. Brands are coming to the studio to complete ads that were already in production with special effects, he said. “For example, an auto spot where the car would have normally been shot by a specialist auto director -- it still can be, but the car will be built by animators in computer graphics instead of shot live-action on location.”New TechnologyAnimation and visual effects studios were already changing the way they work so teams can collaborate remotely, and shifting computing horsepower from office servers to the cloud. The shock of the coronavirus will hasten the move to new video production methods, said Neil Hatton, CEO of film and TV industry lobby group the UK Screen Alliance.“There are parallels with the Japanese tsunami, which accelerated a move from production delivered on tape to production on computer file as the tsunami wiped out the tape-manufacturing companies on the coast of Japan,” said Hatton.For an industry that prides itself on creativity, ingenuity is more important than ever. Advertisers may be facing a worse setback than the 10% retraction in marketing spending that followed the 2009 financial crisis, Bloomberg Intelligence analyst Matthew Bloxham said. Ads typically cost companies the equivalent of about 11% or 12% of sales and are easy to reduce. The slump is going to spread quickly from the travel and leisure industry clients, who cut their spending immediately, to luxury goods, cars and clothes, he said.Read more: TV Industry Faces Billions in Lost Ads During Sports Hiatus“We know that it’s going to be quite a sharp kind of effect -- the question is how long that effect goes on for,” McCann’s Lund said. “We’re having conversations with our clients about what does the world look like on the other side and what does it mean for brands and how they exist in people’s lives.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Pandemics have always been fellow travelers of globalization. A third phenomenon stalks in their shadow: racism.That's worrying. The global threat of Covid-19 seems to be leading not to a unified global response, but to an American president who until Tuesday was describing it as a “Chinese virus” while officials in Beijing stirred up conspiracy theories on social media about a U.S. military origin for the disease. Already, stories are proliferating of people subject to abuse and attacks for “coughing while Asian,” or being turned away from businesses because of actual or presumed Chinese ethnicity.Sadly, there’s nothing new in this. As my colleague Pankaj Mishra has written, the current situation parallels events a century ago, when the first interconnected world economy unraveled into the chaos of World War I. It was disease, as much as war and revolution, that drove that collapse.The age of sail had imposed a natural restraint on both epidemics and migration. It took as long as a month to cross the Atlantic, meaning any infections had already burned themselves out by the time a port was reached. When typhus spread to North America among Irish emigrants fleeing the potato famine of the 1840s under sail, the onboard outbreaks were so notorious that the boats were nicknamed “coffin ships.”Steamships changed all that, opening up ocean transport by drastically lowering its cost and cutting the time needed for transatlantic crossings to less than a week. That helped spark the first era of mass migration as millions of Europeans left for the new world — but it also put the length of a transatlantic journey well within the period when diseases could spread unnoticed.Cholera, which had previously been confined to an endemic area around Bengal, spread among the officers and traders of the British Empire to inflict devastating epidemics on every continent. Smallpox pandemics played a crucial role in the Americas since Columbus’s day, enabling colonialism due to their devastating impacts on indigenous populations. Yellow fever crept up repeatedly from the Caribbean and central America to ravage the southern U.S. In 1889, the first modern influenza pandemic spread rapidly from Russia to North America.Since that era, immigration restrictions and public health measures have often gone hand-in-hand. It’s no coincidence that sites in New York Harbor synonymous with migration such as Ellis Island and Liberty Island started life as quarantine stations. “International mobility is central to the globalization of infectious and chronic diseases,” according to a 2007 bulletin from the World Health Organization. “The history of health and foreign policy reflects long-term links to migration issues.” As people confined to their homes will be well aware, limits on human movement and interaction are crucial to holding back outbreaks of disease. Racism, however, exploits a flaw in human reasoning quite as effectively as infections exploit flaws in our immune defenses. The central fallacy is to assume that if international travel helps spread disease, a perceived “foreign” group is most likely to be carriers. Viruses, though — unlike people — don’t much discriminate by race.(2)The Covid-19 outbreak in Italy is a case in point. Several commentators have claimed without evidence that the source across the north of the country was the large number of Chinese migrants working in Italy’s fashion sector. In fact, tracing the contacts of the infected and finding “patient zero” is a well-established practice in epidemics, and there’s no sign of any significant origins among garment workers. All the research to date suggests the key source was instead a 38-year-old Unilever Plc employee named Mattia from the town of Codogno.Despite the lack of evidence that ethnic groups are responsible for disease, the canard has been frequently been used to justify racist measures. One notorious 19th-century cartoon from Australia’s Bulletin magazine presented China as a malignant octopus attacking the country, two of whose arms were labeled “smallpox” and “typhoid.”It was a similar story in the U.S. Only about 1% of the mostly European immigrants coming to Ellis Island around the turn of the 20th century were rejected for medical reasons. By contrast, some 17% of the more Asian migrant population at San Francisco’s Angel Island was disbarred for sickness, owing in large part to more intrusive screening and vague disease categories applied to non-Europeans. Anti-Chinese measures like San Francisco’s Cubic Air Ordinance were justified on public health grounds as measures to combat “insanitary” overcrowding. For much of the past century, the relative absence of pandemics has put the alliance between racism and disease into remission. Vaccines, antibiotics, sewerage systems and a better understanding of hygiene have proved our most powerful tools for fighting disease. One of the more enduring threats of coronavirus may be the way it changes this calculus. With luck, the connections built up during this era of mass migration will keep xenophobia in check. Trump said Tuesday he would stop using the term “Chinese virus.” That’s a start. (1) Some diseases do appear to be prevalent at different rates among different ethnic groups, such as hepatitis C, although the mechanism for this isn't well understood. Many people with African ancestry are less likely to die from the malaria amoeba thanks to a side-effect of sickle-cell anemia, a blood condition.This column does not necessarily reflect the opinion of Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Most people feel a little frustrated if a stock they own goes down in price. But sometimes broader market conditions...
Unilever United States today announced its ‘United for America’ initiative, a wide-ranging set of measures to support the American people during the coronavirus (COVID-19) pandemic.
(Bloomberg Opinion) -- Nothing says funding is not a problem during this crisis than a 10 billion-euro ($11 billion) debt issue. Spain, in a state of emergency because of the coronavirus, achieved this on Tuesday with a seven-year bond sale that attracted more than 36 billion euros of orders.The country was one of 11 high-grade borrowers testing the waters in what was the busiest day of the month for bond sales and the fourth-busiest of the year. This week’s volumes have already surpassed the total of the first three weeks of March, when the outbreak really suppressed supply. Wednesday is set to be even bigger.Raising such a jumbo deal did mean Spain had to offer a yield that was 18 basis points higher than an existing, slightly shorter seven-year bond. Its last syndicated issue, earlier this year, came with a lower yield than its existing debt. However, the world has changed profoundly and issuers have to be prepared to dangle a carrot to entice investor demand. In the circumstances, this wasn’t much of a premium for investors.A similar phenomenon was also evident for the European Investment Bank, whose three-year bond deal came at an 11 basis-point premium to its existing equivalent. Likewise, premiums were in evidence Monday for new deals from the German States of Bavaria and Saxony-Anhalt. Though, again, they weren’t huge, which shows how desperate investors are to find somewhere to put their money.Corporate deals are making a comeback too: Unilever NV and Engie SA last week followed the trend for higher yields. Company issuance has seen the biggest decline in the bond market this year, unsurprisingly give the business shutdowns, running nearly 20% behind last year's pace. Coca Cola European Partners, Sanofi and Nestle SA all came to the market with multi-tranche issues on Tuesday, illustrating the improvement in conditions. Heineken NV, Danaher Corp. and Carrefour SA were doing benchmark euro deals on Wednesday.The European Central Bank can breathe a bit easier as its 1 trillion euros of quantitative easing planned for the rest of this year is starting to take effect. As there will be considerable emphasis on its corporate sector purchasing program, many of the new investment grade deals should benefit from being scooped up by the ECB, if they’re from Europe-based issuing entities.Wednesday has also seen the return of major banks with Lloyds Banking Group Plc, HSBC Holdings Plc, and Goldman Sachs Group Inc. all bringing euro deals. Credit spreads (the yield on corporate debt relative to sovereign benchmarks) have ballooned since late February, offering better returns for investors than government bonds if they have cash to put to work. Those spreads will start to narrow, but the virus has created a new paradigm, whereby a decent new-issue premium is essential to a successful deal. Normality is returning to European debt capital markets, but the heady days of super-tight credit spreads and incredibly low non-core government bond yields look to be over.This column does not necessarily reflect the opinion of Bloomberg LP and its owners.Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Unilever N.V. and Unilever PLC announced that each filed today, March 9, 2020, its Annual Report on Form 20-F, for the fiscal year ended December 31, 2019, with the United States Securities and Exchange Commission. A copy of this Annual Report on Form 20-F is available to download on its website at http://www.unilever.com/investorrelations or www.unilever.com. Copies of the Annual Report on Form 20-F are available, free of charge, upon request to Unilever PLC, Investor Relations Department, 100 Victoria Embankment, London EC4Y 0DY, United Kingdom.
(Bloomberg Opinion) -- When Laxman Narasimhan cut the full-year outlook for Reckitt Benckiser Group Plc in October, the company’s new chief executive officer threw in everything but the kitchen sink.On Thursday, he completed his demolition job of expectations at the maker of everything from Durex condoms to Dettol disinfectant, saying the operating margin would be much lower in the future and announcing a 5 billion-pound ($6.5 billion) writedown to the value of the Mead Johnson baby-formula business, which Reckitt bought just three years ago for $17 billion.Easing back on Reckitt’s margin expectations was essential, as it gives it the space to make some much-need investments to boost sales. Even in 2019, when its results were hurt by a poor flu season and the continued underperformance of Mead’s infant nutrition products, its operating margin was 26.2%, well ahead of Unilever’s 19.1% and Nestle’s 17.6%.Reckitt aims to invest about 2 billion pounds over the next three years to try to deliver mid-single digit organic revenue growth. It rose by just 0.8% in 2019. Part of this will be funded by 1.3 billion pounds of cost savings. But there will also be a hit to the margin of 3.5 percentage points this year, much bigger than the market had expected.Relaxing the margin also leaves room to change Reckitt’s hard-driving culture, which has historically obsessed about controlling costs and short-term earnings. Martin Deboo, an analyst at Jefferies, anticipates an operating margin of 22.7% in 2020. The company wants to return to a margin percentage in the mid-20s eventually.The new CEO has also signaled portfolio change. He has ditched a plan to split Reckitt into its hygiene and home business — owner of brands such as the Cillit Bang cleaner and Vanish stain remover — and its health arm, which owns Nurofen painkillers and Scholl foot products. Reckitt will now remain as a single company, but with three divisions: hygiene; health and nutrition.This structure, together with the whopper writedown, suggests that the nutrition business — primarily Mead Johnson — might be for sale at the right price. That is wise, given the poor performance of baby milk since Reckitt acquired Mead. The foray into formula under former CEO Rakesh Kapoor looks like a colossal waste of money. Reckitt also missed out on buying Pfizer’s consumer health unit, a far better fit, because it was busy digesting Mead Johnson and needed to cut debt.Narasimham says Reckitt’s problems are operational. Still, fixing them won’t be straightforward, particularly with any coronavirus related disruption to consumption and supply chains. Given the economic context, the new growth and operating margin targets look a stretch.Also, an activist investor might be tempted to push for a breakup if his strategy doesn’t work, particularly if the shares, which fell about 5% on Thursday, decline further. The now abandoned plan to split the hygiene and home division from the health unit might have delivered value.If Narasimham doesn’t clean up at Reckitt, a hedge fund may try to do the job for him.To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Dan Loeb’s Third Point LLC says it has a history of working constructively with boards to promote the success of their companies. The activist’s latest goal seems to involve removing the board of Prudential Plc entirely, and dismantling the head office around it, as part of a breakup of the $48 billion insurer.That may not be as hard as it sounds.Once focused on Britain, Prudential has transformed into a large Asian insurer with a smaller U.S. business attached. Its shares suffer under a stark valuation discount to Hong Kong-listed peer AIA Group Ltd., and Loeb has set out a plausible explanation for why. The reason, he says, is that the Asian side needs capital to grow, but competes with shareholders for dividends. Likewise, the U.S. business would be better off conserving cash in support of its own capital strength. Meanwhile, most investors don’t want to invest in an Asian-U.S. hybrid insurer.The remedy sounds simple: Split Prudential into separate U.S. and Asian businesses with their own stock listings and dividend policies. The Asian shares would probably command a much higher valuation than whole the group does now, providing an acquisition currency that would be a cheap source of growth capital. At the same time, scrapping the conglomerate structure would eliminate the need for a costly corporate center based in London.None of this is likely to be a huge surprise to Prudential’s directors. The board has already been simplifying the company, mainly by spinning off the M&G Plc asset management business. That move has failed to address the valuation gap, so the next logical step would be to jettison the U.S. subsidiary and become a pure Asia play. Prudential’s chairman, Paul Manduca, is retiring next year anyway, and Chief Executive Officer Mike Wells has been in the role for five years. Manduca’s successor, banker and former government minister Shriti Vadera, has a chance to be radical.The real opponents to Loeb’s ideas are more likely to be found among Prudential’s long-term investors. Third Point is a new arrival taking on a longstanding problem. But Prudential has a large number of U.K. investors whose own narrow interests may be served by keeping it in its current form, paying high dividends via a London-listed share. Recall that consumer giant Unilever NV encountered huge resistance to an attempt to simplify its structure in 2018, while plumbing group Ferguson Plc is moving with extreme care about a possible re-domicile for the same reason.Loeb argues Prudential in two pieces would be worth twice what it is today. He may be right, but if a breakup involves a dividend cut along the way, it won’t be plain sailing.To contact the author of this story: Chris Hughes at firstname.lastname@example.orgTo contact the editor responsible for this story: Beth Williams at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
SHANGHAI/BEIJING (Reuters) - Shanghai has compiled a list of firms, including local units of multi-nationals Unilever PLC <ULVR.L> and 3M Co <MMM.N>, as eligible for millions of dollars in subsidised loans to ease any blow from the coronavirus outbreak, according to bankers and documents seen by Reuters. In an economically bruising three weeks, China has cordoned off cities and suspended transport links in an effort to slow the spread of the virus. Some lenders in the city have each received a list of firms compiled by the Shanghai branches of the Ministry of Industry and Information Technology (MIIT) and the National Development and Reform Commission (NDRC), according to seven bankers, each at a different lender.
(Bloomberg Opinion) -- It isn’t just Unilever NV that’s struggling to sell more food. Rival Nestle SA now expects to come up short of its self-imposed sales-growth target this year, and it’s counting on acquisitions to put it back on track.While Chief Executive Officer Mark Schneider met the lower end of a goal for underlying operating margin 12 months early, it will take at least another year for the owner of the Nesquik and Nespresso brands to reach and sustain its annual sales growth objective of 4-6%, partly due to the effect of disposals.It’s a rare misstep for Nestle’s first external CEO for almost 100 years. Even with the 2% drop on Thursday, the shares are up more than 40% since his arrival in January 2017, outpacing Unilever. While Schneider’s made a good start selling off underperformers and making purchases in faster growing areas, such as coffee, pet food and meat substitutes, more reshaping is needed. He has traded — either acquired or moved out of — businesses that accounted for about 12% of total sales in 2017. That’s ahead of his target for changing up 10% by the end of 2020. He’s not done yet. From here the focus will be more on acquisitions than disposals.While expanding in the right growth markets is key, Schneider should also go further in pruning the Swiss food giant. Possible culprits for offloading could be parts of the U.S. frozen foods business, especially pizzas, or some water assets, such as those mainstream brands that can’t be taken up market. The fact that Nestle wrote down the value of its Yinlu business in China could be a prelude to an exit from difficult divisions, for example making peanut milk. However, selling off these businesses may be trickier than previous disposals in confectionery, skincare and ice cream.There’s also a risk that Schneider, in an effort to turbocharge growth, becomes less disciplined when he buys. He indicated that he’s open to a wide array of options, the most promising being small or mid-sized purchases, particularly in the hot market for nutrition and metabolism. He lamented that last year was heavy on disposals, but light on purchases. That should change this year, but he shouldn’t be too eager and so strike rash deals.Schneider is comfortable in the pharmaceutical space, having led German healthcare company Fresenius SE before joining Nestle. Medical nutrition not only has higher growth prospects and margins than many food areas, but it is also less constrained by competition rules because Nestle doesn’t have such a big position. He most recently bolstered Nestle’s medical nutrition arm by acquiring gastrointestinal medication Zenpep and increased the investment in Aimmune Therapeutics Inc., which has developed a product to counter the effects of peanut allergies. It indicates that this area, particularly treatments related to the body’s metabolism, is likely to be a bigger focus.To fund any large-scale ambitions, Schneider has Nestle’s stake in L’Oreal SA, worth about 35 billion euros ($38 billion), to play with. The company has always said that it won’t part with this holding unless it has a strategic use for the proceeds, but but he seemed to be more open to an exit on Thursday. Small- to medium-sized deals wouldn’t require any change. A bigger transaction — which can’t be ruled out — might.Either way, Schneider can’t afford to take the wrong turn. Not only is activist Dan Loeb still on the register, but Nestle’s valuation has increased significantly under his tenure. The shares trade on about 22 times forward earnings, compared with about 20 times for Unilever.The premium is justified by Unilever’s recent sales stumble, as well as its slower pace of portfolio change and less focused approach to acquisitions. That doesn’t mean Nestle won’t be punished if it disappoints in the same way as its rival.To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The company said in its new principles on responsible marketing that it would also stop hiring influencers and celebrities who primarily appeal to children under the age of 12 and would also curb its use of cartoon characters. The company's ice-cream business will be the first to implement these changes, which follow moves by the company over the last five years to cap the total calories and sugar levels in kids' ice-creams at 110 calories and 12 grams per portion. In 2016, 124 million children and adolescents between the ages of 5 and 19 were estimated to suffer from obesity worldwide, while 213 million were overweight, according to the World Health Organization's latest figures.
(Bloomberg Opinion) -- Harry's Inc. billed itself as an alternative to overpriced razors, and the sales pitch worked — too well, in fact.The shaving company’s planned sale to Schick razor maker Edgewell Personal Care Co. officially collapsed on Monday after the Federal Trade Commission sued to block the $1.37 billion deal on anti-competitive grounds.There had been some thought that Edgewell would fight for the Harry’s deal in court, but the company said Monday it’s instead walking away, “given the inherent uncertainty of a potential trial, the required investment of resources and time and the distraction that a continuing court battle would entail.” Shareholders are fine with that: The stock rose more than 20% on Monday after climbing 13% on Feb. 3, when the FTC’s opposition was announced. While investors may be happy to say goodbye to an acquisition that was arguably overpriced, regulators’ opposition to the takeover has wide-ranging ramifications. Among other things, this threatens to close the door on one of the more sure-fire exit strategies for would-be direct to consumer unicorns.In advertisements, Harry's pitched itself as "the shaving company that's fixing shaving." In its complaint, the FTC argues that Harry’s successfully disrupted an effective duopoly between Edgewell and Gillette-maker Procter & Gamble Co. and forced the incumbents to start lowering their prices for razors. Curiously, it argues that this only happened once Harry’s products migrated out of the e-commerce-only environment in which they launched and started appearing on shelves at Target Corp. and Walmart Inc. stores. Using similar logic, the FTC dismisses Dollar Shave Club – acquired by Unilever NV in 2016 for $1 billion – as a full-blown competitor capable of making up for the loss of an independent Harry's in part because it still mainly sells razors via an online direct-to-consumer model.The idea that firm lines exist between the online and brick-and-mortar worlds — and that pricing dynamics in one don’t affect the other — feels rather silly in this day and age. Most consumers wouldn’t distinguish between the two marketplaces, and increasingly, neither would businesses. The FTC’s decision to block the Harry’s purchase is reminiscent of pushback to the merger of Staples and Office Depot in 2016, where the regulator ignored the stream of sales defecting to Amazon and declined to view it as a strong enough competitor in commercial office supplies. Amazon’s 2017 acquisition of Whole Foods Market Inc., by contrast, was waved through without a second glance and closed in just two months.Notably, without Harry’s and without the sales from an infant and pet-care business Edgewell sold in December, the company now expects total revenue to decline as much as 5% this year. When Edgewell had announced the Harry’s purchase last year, it projected a $20 million increase to Ebitda by 2023 from annual cost savings and an additional $20 million boost from revenue benefits, including new brand launches and international expansion opportunities. Antitrust regulation isn’t a forward-looking industry and I don’t think anyone would want to task the FTC or the Department of Justice with picking out the winners and losers of the future. But the result is a system that seems ill-suited to navigating the changes to the economy from e-commerce and direct-to-consumer business models. And while regulators may not want to predict the future, their actions will have a significant impact on what unfolds from here.One of the odd messages being sent by this decision is that it may be better for upstart consumer brands to avoid brick-and-mortar stores if they want to sell themselves to a more-established organization down the road. That’s not going to be helpful for Target, Walmart or the bevy of aging department stores trying to compete with Amazon and make themselves relevant to today’s consumer. Another alternative is for startups to sell out before they get big enough to matter, which raises the odds that smaller brands get swallowed up and killed off rather than nourished into viable competitors. The IPO route looks increasingly closed, at least at the valuations many had enjoyed in the private markets. Some brands will still succeed as independent entities – Glossier, Allbirds and Warby Parker come to mind – but the road to making it big arguably just got tougher.To contact the author of this story: Brooke Sutherland at firstname.lastname@example.orgTo contact the editor responsible for this story: Beth Williams at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Brooke Sutherland is a Bloomberg Opinion columnist covering deals and industrial companies. She previously wrote an M&A column for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
American Airlines, hotel giant Marriott International and footware maker Nike were among 36 firms that spoke out this week against a law allowing adoption agencies to turn away LGBT+ couples on religious grounds, passed in Tennessee in January. "We ask that lawmakers not pursue any further legislation that would target or exclude LGBTQ people," the companies, which also included Amazon, Dell Technologies and Nashville International Airport, said in an open letter. A spokesman for Tennessee Governor Bill Lee, a devout Christian, did not immediately respond to requests for comment.
(Bloomberg Opinion) -- Cars and cigarettes have at least one thing in common these days: They are both being disrupted by more modern alternatives. So Stefan Bomhard, the chief executive officer of car dealer Inchcape Plc, should have some idea of what he’ll face when he takes the reins at U.K. cigarette maker Imperial Brands Plc.It isn’t easy to find executives willing to move to the much-aligned tobacco industry. But Bomhard looks a good CEO choice for Imperial, which sells Lambert & Butler cigarettes and Blu vapes. The company had decided to part ways with Alison Cooper in October, a week after a profit warning. She will now step down as with immediate effect.Bomhard did a solid job at Inchcape. While the shares are down about 18% since he became CEO in April 2015, underperforming the FTSE All-Share Index, conditions in car dealing haven’t been easy since Britain voted to leave the European Union and consumer confidence crumbled. It’s still a much better performance than the FTSE All-Share General Retailers Index.The downside is that Bomhard doesn’t have any tobacco experience. But this is less of an issue than it would be in, say, general retailing. Imperial will have plenty of executives with many years’ worth of knowledge of the traditional cigarette business, still the biggest and most profitable part of the group. And he should be able to pull on his prior experience with big global brands in the race to grab market share for Imperial’s new products, whatever they may be.The new chief executive spent his career in consumer goods before joining Inchcape, with roles at spirits company Bicardi, chocolate and candy maker Cadbury, and consumer-goods giant Unilever. That should put him in good stead as Imperial attempts to pivot to alternatives to traditional cigarettes, which could in turn, pave the way for it to diversify into dispensing other adult, highly regulated products, such as cannabis.When Bomhard takes up the role at a yet to be determined date, his first task will be to get to grips with the crisis in the U.S. vaping industry. The company is evaluating the impact of the recent Food and Drug Administration ban on flavors aside from menthol and tobacco for pod-based electronic cigarettes, the type it makes.Then Bomhard will have to work quickly to decide where best to focus Imperial’s attention, and investment. Although the group has strong positions in vaping and oral nicotine, it only entered the heat-not-burn market relatively recently. He must decide whether to expand in this category, which has not been drawn into the crisis in the U.S. vaping industry.He could also look at reshaping other aspects of Imperial’s business, including traditional cigarettes. The company is already seeking to raise up to 2 billion pounds ($2.6 billion) through disposals, including a sale of its premium cigar business. But he could go further, say selling off parts of the portfolio in Asia and Africa, and returning the proceeds to shareholders, or investing more in tobacco alternatives.Either way, Bomhard must take decisive action. Shares in Imperial have fallen more than 20% over the past year, and they trade at a 40% discount to Bloomberg Intelligence’s global tobacco manufacturing valuation peer group. The company even lags Altria Group Inc., which is reeling from its disastrous investment in vaping company Juul Labs Inc.Imperial has long been seen as an acquisition target, with Japan Tobacco Inc. tipped as the most obvious contender. Another possibility would be for Japan Tobacco and British American Tobacco Plc to carve up Imperial’s empire between them along geographical lines. So if Bomhard doesn’t light up the Imperial share price, a bigger rival just might.To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.