Unilever warns about rising commodity prices

Rapid growth in emerging markets helped Unilever post its strongest quarterly revenue growth for three years yesterday. But the consumer goods giant warned higher commodity prices means its full-year margins will be flat or lower.

Unilever, which owns the Lipton tea, Vaseline and Domestos brands, grew underlying sales by 7.8 per cent in its third quarter, with its personal care division the star performer. But Paul Polman, the chief executive of Unilever, said: "In 2011, we have sought to mitigate the impact of commodity inflation on consumers by pricing to cover cost rather than to maintain margin." It now expects its underlying operating margin in 2011 to be "flat to slightly down".