Unilever Shares Fall on Lower 1st Half Pretax Profit, Warning of Rising Costs -- 2nd Update
By Matteo Castia
Shares in Unilever PLC fell Thursday after the company reported
a slight fall in pretax profit for the first half of the year, and
said it expects full-year margins to remain flat as a result of
The Anglo-Dutch multisector-goods producer--which owns consumer
brands such as Ben & Jerry's ice cream, Dove soap and Cif and
Domestos cleaning products--posted a pretax profit of 4.37 billion
euros ($5.15 billion) for the period, compared with EUR4.53 billion
a year earlier.
Profitability was hurt by a negative impact of 6.1% from
currency-related items, the company said.
First-half turnover came in at EUR25.79 billion, including
EUR13.45 billion in the second quarter, the company said. This
compares with prior-year figures of EUR25.71 billion and EUR13.29
Underlying sales rose 5.4% on year in the first half, including
a 5.0% increase in the second quarter. Underlying sales of foods
and refreshment jumped 8.1%, while home-care underlying sales rose
4.5%, the company said.
Beauty and personal-care underlying sales increased 3.3% on the
year, with underlying sales growth accelerating to 4.2% in the
second quarter, helped by increased personal-care consumption as
restrictions were eased in some markets, the company said.
"Restrictions on daily life continue around the world, impacting
channel dynamics, sales mix and consumer behavior," the company
The board declared a second-quarter dividend of 42.68 European
cents a share.
"We are confident that we will deliver underlying sales growth
in 2021 well within our multiyear framework of 3% to 5%, despite
more challenging comparators in the second half," Chief Executive
Alan Jope said. However, Mr. Jope also said that underlying
operating margin for the full year is likely to remain around flat
because of mounting costs.
"We have seen further cost inflation emerge through the second
quarter. Cost volatility and the timing of landing price actions
create a higher-than-normal range of likely year-end margin
outcomes," he said.
Shares in London at 0715 GMT were down 161 pence, or 3.7%, at
Write to Matteo Castia at email@example.com
(END) Dow Jones Newswires
July 22, 2021 03:51 ET (07:51 GMT)
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