Unilever earnings jump on sales

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Anglo-Dutch Unilever the maker of Sunsilk shampoo, Hellmann's mayonnaise and Ben & Jerry's ice cream, posted its underlying sales growth of 3.9 percent in April-June after a disappointing 2.9 percent rise in the first quarter.

The rise was ahead of forecasts for 3.5 to 3.7 percent and came as the world's third-biggest consumer goods group spent heavily on its sales-led recovery after a shock profits warning in 2004, and compared to the group's 2 to 4 percent medium-term target.

Chief Executive Patrick Cescau said he expected to achieve the group's outlook for the year of sustained growth and an operating margin above last year in spite of rising commodity costs, and now looked to expand its business ahead of its markets.

"This strategy will enable us to grow ahead of our markets with sustainable margin improvement. I am confident that this will lead to sustainable underlying sales growth of 3 to 5 percent and an operating margin in excess of 15 percent by 2010," Cescau said in a results statement.

The group's recovery saw sales growth of 3.1 percent in 2005, as part of seven successive quarters of growth so far since its nadir of 2004, when it saw virtually zero growth.

The group posted second-quarter earnings per Unilever NV share for continuing operations of 0.33 euros, in line with analysts' forecasts of 0.26 to 0.37 euros, with underlying operating profits rising 20 percent to 1.44 billion euros (980 million pounds).

Its second-quarter operating margin rose 2 percentage points to 14.0 percent.