Unilever expects to maintain advertising and promotion at around 14.9% of sales in the second quarter, the same as a year ago, despite declining media costs in Europe and the U.S., said Howard Green, head of investor relations. Overall, Unilever expects sales in the quarter to grow 4% to around $11.5 billion, excluding the effects of last year's Bestfoods acquisition and divestitures, such as Elizabeth Arden cosmetics. Growth is expected to be slower.
The Anglo-Dutch package-goods giant expects earnings to grow 5%. Sales growth came in slightly below the expected 4.5%, he said, citing several factors, including scaling back quarter-end trade promotion, spending behind the Mazzola cooking oil and Hellman's mayonnaise brands that had been used by Bestfoods in prior years.
The launch of laundry detergent tablets in the U.S. has been disappointing, with the segment so far capturing only about 2% of the $4.9 billion laundry detergent category, compared to 10% or more in some European markets. But Mr. Green said, Unilever research shows its Wisk tablets so far are outperforming Procter & Gamble Co.'s Tide tablets both in initial consumer trial and repeat rates. Unilever plans to launch All and Surf tablets later this year.