Inflation worries overshadow Unilever’s strong first half, hit shares – Reuters

SourceReuters
SectorFinancial Markets
CountryGulf

Q2, H1 underlying sales growth beat estimatesOperating margins now seen flatGroup sticks with 3-5% mid-term sales growth goalShares down 5.7%, biggest loser on FTSE 100

July 22 (Reuters) – Unilever Plc (ULVR.L) warned on Thursday that surging commodity costs would squeeze its full-year operating margin, overshadowing strong second-quarter sales growth fuelled by the easing of pandemic-related curbs in many of its markets.

Underlying sales for the maker of Dove soap rose 5% in the three months ended June 30, above 4.8% forecast by analysts.

It maintained its 3-5% sales growth forecast for the year, but rising prices of everything from crude to palm and soybean oil made the company cut its operating margin outlook to “about flat” from “slightly up” earlier and flag greater uncertainty surrounding that forecast.

The warning dragged shares of the FTSE 100-listed company down 6.2% by 1345 GMT, wiping off nearly 7 billion pounds ($9.65 billion)of its market value, and making it the top loser on the index on...read more...