Consumer goods giant Sara Lee Corp yesterday [Thursday] announced a five per cent rise in second quarter sales to US$5bn compared to the year ago period, but said diluted earnings per share (EPS), excluding unusual items, fell 14% to US$.37.

The company, whose products range from coffee to sausages and underwear, added that total sales for the first six months of fiscal 2002 reached US$9.5bn, up 3% over the same period a year ago.

Meanwhile, diluted EPS, excluding unusual items, were US$.63 versus US$.72 for the first half of fiscal 2001, down 13%.

In a statement the company said its results for the second quarter to 29 December and the first half were affected by several unusual items included in a reshaping program.

Including unusual items, diluted EPS were US$.20 for the quarter and US$.49 for the first half, compared to US$.92 and US$1.20, respectively, in fiscal 2001.

Commenting on the results, C Steven McMillan, chairman, president and chief executive officer of Sara Lee Corporation, said: "Sara Lee continued its program of accelerated investment in its brands, its portfolio and its business infrastructure during the second quarter as our company becomes a more innovative and effective organisation.

"We have also made progress in reducing excess production capacity and improving the effectiveness of our sales organisations. As we begin to benefit from these investments, we enjoyed increased sales in several of our key product categories during the second quarter, despite difficult global market conditions, and we expect to report improved earnings beginning with the third quarter of fiscal 2002."