Unilever reports profit slump but sales rise

ROTTERDAM, July 31, 2008 (AFP) - Dutch food products and cosmetics giant Unilever reported on Thursday, July 31st a 19 percent slump in net second-quarter profit on restructuring charges, but a rise in sales beyond analysts' forecasts.

Unilever, describing its performance as "good", said that the net figure for the quarter fell to 978 million euros (1.52 billion dollars) from 1.144 billion euros at the same time last year.

The price of shares in the group fell by 5.55 percent to 18.30 euros in early trading.

Pre-tax operating profit fell by 4.0 percent to 1.353 billion euros. Sales fell by 1.0 percent to 10.374 billion euros, but at constant exchange rates they rose by 6.0 percent.

Chief executive Patrick Cescau said this amounted to "a good performance in a challenging environment" and that the group stood by its forecasts for the year.

The fall in the net figure reflected mainly increased restructuring charges, the fact that tax factors had been more favourable in the comparable period last year, and the effects of the strength of the euro.

Restructuring was going well and should yield savings of 1.0 billion euros this year.

Unilever also said that it had taken a big step in its plan to sell some assets with the sale of the Bertolli olive oil business for 630 million euros and of its detergent activities in North America for 1.075 billion dollars in cash and 375 million dollars in shares.