Unilever raises its aim on profits

UNILEVER has raised its profit forecasts for the year despite the Ben & Jerry's-to-Dove soap group seeing ice cream sales suffer in the wet European summer.

The Anglo-Dutch group, halfway through its four-year strategy of cutting its portfolio of brands from 1600 to 400, said the percentage growth rate of its full-year underlying profits would increase by the mid-teens. That marked an increase of about 4% from its previous guidance.

Unilever made its pledge after a strong increase in margin growth and the successful launch of a dizzying number of products, ranging from Dove shampoos and conditioners to Bombay Bad Boy spicy Pot Noodle. Finance director Rudy Markham said: 'It's all to do with good progress raising the operating margins, fuelled by cost savings and strengthening pricing with our greater mix of products.'

Pre-tax profits in the six months to 30 June were e2.3bn (£1.4bn) against e2.1bn a year earlier on sales of e25.6bn compared with e25.9bn before. The sales decline reflected its shrinking number of brands. The pre-tax profit figure was ahead even though there was an exceptional profit of e318m from disposals the year before.

Sales growth of leading brands, now 88% of the group's business, increased 4.4% during the second three months of the period. Flat ice cream sales in Europe dragged back some of the performance of Unilever's frozen foods division. Markham said that was due to the unseasonably wet second quarter of the year, which compared with a sunny spell a year earlier. Sales of ices in North America, Latin America and Asia Pacific more than made up for the shortfall.

After the success of Dove soap's offspring shampoo and conditioner products in Britain, the company plans to push the products on to the Continent. The Lynx men's fragrance range is being expanded to the US in the current quarter. The performance in America was fairly flat after a strong first half last year but Markham expected a better second half thanks to product launches.

The shares jumped 46p to 562 1/2p.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in