Unilever reports profits boost

Consumer products giant Unilever today banked a 7% rise in pre-tax profits as demand for its products grew in the UK and Germany.

The Anglo-Dutch firm, best known for brands such as Dove soap, Magnum ice cream and Hellmann's mayonnaise, saw pre-tax profits increase to €4.83bn during 2006, as its European business returned to growth, with a rise of 1%.

However, the group said that commodity costs were higher than expected throughout the year and warned that food commodity costs continued to grow, with no let-up expected during 2007.

Underlying sales growth reached 3.8%, in line with analyst's forecasts, amid increased investment in advertising and promotions.

The UK market, the company’s largest division, returned to growth boosted by increased demand across most of its foods and personal care products sectors. While laundry sales declined in general over the full year, the company has made recent progress in market share as Persil regained its position as the country’s top selling laundry brand.

Across Europe, Unilever gained market share in its ice cream, soups, deodorants and body care products, although ground was lost in laundry, hair care and tea.

The company said its restructuring programme had improved operational effectiveness at the group, with faster decision making and improved local execution helping the company to allocate resources more effectively throughout the business.

Unilever said its focus for the forthcoming year remained on increasing organic growth, particularly in personal care, and the drive to improve margins.

The company said it remained on track to deliver its long-term targets.