Anglo-Dutch company Unilever reported flat sales of leading brands and lower second-quarter operating profit, but the company stuck to its 2004 earnings per share target. Lower interest costs, a tax benefit and cost savings from stepped-up restructuring programs will help Unilever reach that goal, according to Rudy Markham, Unilever’s finance director.
Sales of the top 400 brands, which Unilever previously said would grow by more than 2.5% in 2004, were predicted to improve in the second half of the year. Unilever said operating profit before exceptional items and amortization of goodwill and intangible assets fell 2% to $1.96 billion, which was just below analysts’ forecasts, according to a Reuters poll.
Unilever blamed poor ice cream and ready-to-drink tea sales in Europe, due primarily to a cool start to summer.
Group turnover fell 3% to $13 billion, but net proft jumped 34% boosted by lower interest costs and taxes.
For 2004, Mr. Markham maintained a forecast for an operating margin of more than 16%. l