ULVR Unilever Plc

--Unilever's first-half net profit rose to EUR3.28 billion, despite pandemic hurting non-hygiene and food businesses.

--Second-quarter turnover came in at EUR13.30 billion and beat the EUR12.55 billion market consensus, thanks to household stockpiling in March in the U.S. and Western Europe.

--Following a review of its tea business, Unilever has decided to keep a part it, namely in India and Indonesia, as well as partnership interests in the ready-to-drink tea joint ventures.

By Matteo Castia

Unilever PLC reported Thursday a rise in net profit for the first half despite the coronavirus headwind and said it will keep part of its tea business.

The Anglo-Dutch multisector retailer--which owns consumer brands such as Ben & Jerry's ice cream and Dove soap--made a net profit for the six months of 3.28 billion euros ($3.80 billion), compared with EUR3.01 billion in the year-earlier period.

"In North America and parts of Europe there was a positive impact from household stocking in March. Consumption patterns then normalized in the second quarter with heightened levels of demand for hygiene and in-home food products," the company said.

Turnover for the period decreased 1.6% on year at current rates to EUR25.71 billion, slowed by significant drops in the food service, out-of-home ice-cream, and non-hygiene personal-care products. Underlying sales fell 0.1% on year, below its multiyear target of 3% to 5% growth.

Still, the result came in stronger than the market consensus of a 4.3% decline. Analysts at European investment bank Bryan Garnier had forecast a 4.7% drop.

Second-quarter turnover came in at EUR13.30 billion, beating a market consensus compiled on FactSet of EUR12.55 billion.

In December and January, the company warned that it would miss its underlying sales growth target for the first half. At that time, it said it expected sales to be second-half weighted and at the bottom end of consensus for the full year.

In April, Unilever said the hit from Covid-19 lockdowns in big emerging markets such as China and India was outweighing stockpiling by consumers in the U.S., and it warned the crisis could cause long-term changes in consumer behavior and demand trends.

The board declared Thursday an interim dividend for the second quarter of EUR0.4104.

Following on its announcement in January that it would review its tea business--which includes brands such as Lipton, Brooke Bond and PG Tips--the company said Thursday that it will keep part of it.

"This review has assessed a full range of options. We will retain the tea businesses in India and Indonesia and the partnership interests in the ready-to-drink tea joint ventures," Unilever said.

Write to Matteo Castia at matteo.castia@dowjones.com

(END) Dow Jones Newswires

July 23, 2020 03:49 ET (07:49 GMT)

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