Unilever posted underlying 5% sales growth in the second quarter as the emerging markets' economic slowdown and declining developed market purchases weighed on consumer appetite.

However, Anglo-Dutch consumer goods conglomerate, which also sells detergents, soap, margarine and ice cream, traded over 2% lower in the morning session as the company failed to return bumper growth from the previous quarter.

Unilever's emerging market sales increased by 10.3% in this quarter, which is slightly down from the previous period's 10.4% growth rate.

Developed market sales dropped by 1.3%.

However, Unilever's chief executive officer Paul Polman enthused that "this set of results clearly demonstrates that the transformation of Unilever to a sustainable growth company is fully on track."

"Our innovation pipeline is robust which will be vital as we navigate the slowdown in many parts of the world.

"We remain focused on achieving another year of profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow."

Emerging Market Slowdown

The company warned that growth is slowing down in emerging markets as macro-economic headwinds are influencing consumer behaviour.

Meanwhile, developed markets are continually slowing down with little sign of recovery in North America or Europe.

The stock dropped as Unilever failed to meet over 30 analysts' expectations of overall reaching 5.5%.

Unilever's home care and personal care products continued to have sales growth. The company, which has popular personal care products like Dove and Sunsilk rose by 7.7%, with home care product sales growing by 10.2% in this quarter.

The company reported growth on improving its core operating margin, gaining 40 points in the first half to 14%.

However sales of the food products has been very poor taking a toll on the company's business as the underlying growth stood at 1% only.

The famous maker of Ben & Jerry's ice cream was affected by the bad weather earlier this year which dropped the ice cream sales, giving growth in refreshments of 1.9%.

Earlier this month it was reported that Unilever was looking for a buyer for its snack brand Peperami, in line with Polman's plan to prune product portfolios.

Polman also sold Skippy (a major food brand) to Hormel Food for $700m (£462.32m/€535.73m) earlier this year.

Meanwhile, earlier in July Unilever said it would increase its stake to 67.28% in Indian unit Hindustan Unilever.