Strong Q1 beat, with only Europe suffering significant volume decline Q1 underlying sales growth of 7.3% compares favourably with the consensus of +4.4%, though remains below P&G’s 10% growth rate during the same period. Growth was price-led, as anticipated. Unilever’s volumes -1.0% (consensus -1.7%) were broadly as expected, while price +8.3% (consensus +6.3%) was much stronger. The company’s 13 largest brands grew sales +8.8% in aggregate. By category Home Care grew 9.2%, Beauty & Personal Care grew 7.1% and Foods & Refreshment grew 6.5%. Emerging market grew 9.5% (price +10.1% / vols -0.6%). Volumes have softened in China and Brazil, alongside higher prices. However, volumes remained strong in Indonesia, Philippines and Vietnam. Developed markets grew 4.1% (price +5.7% / vols -1.5%). North America grew 8.5% with price and volume both solidly positive, while Europe grew just 0.7%, with volumes -4.4%. Outlook raises on top-line, margin lowers The FY outlook is raised to the high-end of the 4.5-6.5% range for sales, and to the low end of the 16-17% range for underlying operating margin given ongoing inflation and the need to invest in the brands in order to take large price increases. In the H1 the margin should be within the 16-17% range; a further update on FY margins will be provided at the H1 results. Consensus for the FY has already fallen by c.8% since the start of the year and currently assumes underlying sales growth +5.2% and OM -210bps to 16.3%, with a 2.5% tailwind from FX. We therefore expect that consensus will rise slightly to reflect the stronger top-line, with margin forecasts largely unchanged or nudged down a little. Management hosts a call for analysts and investors at 8am GMT.