LONDON — Net profit at Unilever, parent of brands including Dove, Vaseline and Lux, rose 1.3 percent to 2.4 billion euros, or $3.1 billion, in the first half against a background of what the company called "deteriorating global economic conditions."
Unilever said revenues in the six months to June 30 climbed 11.5 percent to 25.4 billion euros, or $33 billion. Core operating margin remained flat, due partly to increased advertising and promotions.
All dollar figures have been converted at average exchange rates for the period to which they refer.
In the second quarter, sales climbed 11.1 percent to 13.3 billion euros, or $17.3 billion. Unilever said that growth in the period was lower that in the first quarter, which had benefited from the extra leap-year day and Easter falling earlier than in 2011. RELATED STORY: Kao Corp. Q1 Profits Rise 3.2%
"Despite deteriorating global economic conditions and a competitive environment which remains intense, we again delivered volume growth ahead of our markets and gained value share across the majority of our business," said Paul Polman, Unilever's chief executive officer.
"Looking forward, we expect continued volatility, especially in commodity costs and economic conditions. We remain focused on profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow, driven by increased capital discipline. For 2012, we remain on track to deliver a modest improvement in core operating margin,” he added.
With regard to the markets, Polman said consumer confidence remains "fragile" and the competitive environment intense. "The value growth of our markets is driven largely by pricing and reflects the combination of strong growth in emerging markets and sluggish growth in the developed markets, where volume growth continues to be negative," he said.
Emerging markets continued to deliver double-digit underlying sales gains, reaching 11.4 percent in the first half of the year.
Unilever's stock rose 3.8 percent to 22.20 pounds, or $34.63 at current exchange, following the announcement.
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