Unilever profits rise 28%

Consumer products giant Unilever today said first quarter profits jumped 28% despite a significant increase in spending on advertising and promotions.

The Dove-to-Knorr group reported sales volume growth of 7.6% in the first three months of the year, offsetting a 3.3% drop in prices as a result of competitive pressures and lower commodity costs.

Emerging markets delivered the strongest growth, while in Europe sales volumes were up 4% on the back of strong sales in the UK and the Netherlands.

Margins were also higher in Europe despite greater investment in advertising and promotional activity as Unilever battled intense competition.

Chief executive Paul Polman said he expected trading conditions to toughen as the year progressed.

He added: “Commodity costs will increase in the second half, economies remain sluggish and competitive intensity will remain high.”

Pre-tax profits were €1.39bn in the first quarter, an increase of 28% on a year earlier.