FMCG News: Vertex Resourcing’s Weekly FMCG Roundup.

Today, we look at how L’Oréal is continuing to rack up the sales despite the pandemic, what Sainsbury’s price matches the Aldi really look like and how PepsiCo is doing well from at-home snacking. Enjoy!

PepsiCo benefits from at-home snacking

Looking at PepsiCo’s fourth-quarter revenue we see how their sales rose 8.8% to $22.46 billion, topping all expectations and helping the group deliver a 4.8% rise for the year.

However, the profit margins for 2020 was still down 2% at $10.08 billion. Despite the effects of falling out-of-home consumption in places like restaurants and cinemas, sales in PepsiCo’s beverage business accelerated at end of the year. The same group which makes Gatorade, Tropicana, and the soft drink that gave it its name, reported fourth-quarter organic sales in its North America beverage unit which went up by 5.5%.

The revenues for the snacks also continued to rise. North American sales of Frito-Lay and Quaker Foods products increased by 5% and 8% respectively. And the company also produced sales growth across its international markets, led by an 8% rise in Europe.

L’Oréal continues their bounce back

Cosmetics giant L’Oréal continued its recovery in the fourth quarter of last year, having taken a significant hit to its business early in the pandemic.

Over the three-month period to the end of December, revenue was flat on a year ago but up 4.8% when stripping out currency effects and acquisitions. This compares to sales plummeting 18.8% during the second quarter period of the year at the height of lockdowns around the world. The group said its recent performance was driven by strong demand in China and booming online sales. For the year, L’Oréal’s like-for-like sales were down 4.1% with net profit slipping 5% to €3.75 billion. However, the group held operating margins steady at 18.6% by trimming marketing, research and development costs.

The group’s Europe and North America divisions recorded sales declines of 10.3% and 7.4% for the whole of 2020 as consumers stuck at home used less make-up and haircare products, whilst beauty salons were also forced to close.

Sainsburys price matches to Aldi are mostly on their own labels

Over 80% of Sainsbury’s recent wave of Aldi price-matches are in its own label grocery products, which consists of ambient, chilled and frozen products. However, the largest reductions on branded items outside of the grocery category was in beers, wines and spirits.

Following Sainsbury’s announcement recently that it was cutting prices on over 250 popular grocery items to price-match Aldi, as of the 11th of February, there are 246 price cuts with an Aldi Price Match promotion across the grocery, home care, beers, wines and spirits and health beauty categories, with an average reduction of 13.5%.

The largest Aldi price-match reductions from Sainsbury’s are in its home category (23.5%) followed by frozen foods (16.9%) and health & beauty (16.1%). 69% of the price matched products were reduced between 10th-11th February, but the vast majority were already at a low enough price.