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CEO Unilever Alan Jope. Photo/REUTERS
LONDON – British multinational consumer goods giant Unilever may have to stop doing business in Russia.
The company disclosed this threat in its profit and loss statement on Thursday (9/2/2023).
According to makers of products such as Knorr soup, Dove soap and Fairy cleaning fluid, such a move could lead to lost turnover, profits and a decline in Russian companies’ assets.
“We will continue to review and disclose the financial implications of the (Russia-Ukraine) conflict… While the potential impact remains uncertain, there is a risk that operations in Russia cannot proceed,” the statement said.
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According to Unilever CEO Alan Jope, the company has yet to begin phasing out its business in Russia, but wants to alert shareholders and regulators to the possibility.
“I hope we can protect the people we have on the pitch for some time. The war had fueled inflation in Russia, which had become an economic scourge. And our Russian business volumes are down significantly, double digits,” Jope said in a statement to the media, as quoted by Reuters.
He noted that “leaving isn’t easy,” and the company doesn’t want to leave the roughly 3,000 staff currently employed in Russia.
Unilever stopped exports to Russia and imports from that country in March last year, shortly after the start of Moscow’s military operation in Ukraine.
The company also stopped investing, advertising and further projects in the country. However, the company continues to supply locally produced “vital food and hygiene products” to Russian citizens, but stipulates that any profits from those sales will remain in Russia.
As of December 31, Unilever’s Russian assets totaled around $968.6 million, including four factories. Businesses in Russia account for 1.4% of Unilever’s total turnover and 2% of its net profit in 2022.
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