Despite broad-based volume growth, Unilever Plc (Unilever) reported a y-o-y decline in revenues, below our estimate. However, adjusted1 operating and net margin were significantly above our estimates due to lower-than-anticipated operating costs as a percentage of revenues, and effective tax rate. As the results were broadly above expectations we are likely to revise our estimates and target price upwards. However, as the target price currently supports a HOLD rating, we temporarily maintain our HOLD rating for the common stock. We will reassess our target price and rating in our 3Q 09 update report. We continue to anticipate a positive currency impact on the ADR over our 6-12 month investment horizon. Therefore, we maintain our BUY rating and will reassess our target price and rating in our 3Q 09 update report.

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