Unilever chief executive Paul Polman today (5 August) issued a warning about competitive and commodity-cost pressure in the back half of 2010 after the group saw sales growth slow in the second quarter of the year.
Polman, speaking as Unilever announced a 3.6% increase in second-quarter underlying sales, said the Knorr soup and Wall’s ice cream maker still assumed economic growth will be slow, particularly in developed markets.
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“We do not expect competitive pressures to ease and our ability to increase prices will remain constrained despite rising commodity costs in the second half,” Polman said.
Unilever, which saw underlying sales climb 4.1% in the first quarter of 2010, also saw volume growth slow. Second-quarter sales volumes increased 5.7% in the three months to the end of June; in the first quarter, volumes were up 7.6%.
Nevertheless, Polman said Unilever had “delivered another quarter of robust volume growth” and had enjoyed “improved volume market shares in all of our regions”.
Unilever’s second-quarter net profit climbed 39% to EUR1.15bn. The bottom line was boosted by lower finance expenses, a fall in restructuring costs and a drop in pension costs.
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By GlobalDataHowever, underlying operating profit – which excludes restructuring, business disposals, impairments and other one-off items – increased 13% at EUR1.72bn.
Second-quarter turnover was up 12.4% at EUR11.75bn.
Click here for the full earnings statement from Unilever; check back later for coverage of the company’s analyst conference.
