Unilever: success for ProActiv functional food brand

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Anglo-Dutch food company Unilever this week reported faster growth
in the leading brands, strong expansion of operating margin and
strong progress for the fourth quarter of 2001.

Anglo-Dutch food company Unilever this week reported faster growth in the leading brands, strong expansion of operating margin and strong progress for the fourth quarter of 2001.

Underlying sales grew by 4 per cent in the quarter, and by 4 per cent for the year. The impact of the company's disposal programme led to sales in the quarter being 1 per cent lower than last year. Sales for the year, including the impact of acquisitions and disposals, were 11 per cent ahead.

Operating profit, before exceptional items and amortisation of goodwill and intangibles (BEIA), increased by 21 per cent in the quarter and by 28 per cent for the year. Operating margin (BEIA) in the quarter was 14.3 per cent, an increase of 250 basis points over last year, and for the full year rose by 190 basis points to 13.9 per cent.

Amortisation of goodwill and intangibles was €368 million in the quarter and €1,436 million for the year, including €1,186 million for the acquisition of Bestfoods.

Net interest was €1,058 million higher than last year, reflecting the increased level of borrowings related to acquisitions. In the quarter, interest was €395 million, down from €449 million in the same period last year. The company benefited from the continuing strong cash flow from operations, proceeds of business disposals, and lower interest rates.

Exceptional items for the year were €620 million, which includes €1,564 million of restructuring investment and profits on disposals of €944 million. Of the latter, €828 million relates to the profit on the sale of the brands to secure regulatory approval for the acquisition of US company Bestfoods. Associated costs included in operating profit (BEIA) were €393 million for the year, of which €127 million fell in the fourth quarter.

Net profit for the year was up 66 per cent to €1,858 million. Excluding exceptional items and goodwill amortisation, net profit rose by €374 million, or by 12 per cent.

Earnings per share (BEIA) rose by 43 per cent in the quarter and by 12 per cent for the full year. Earnings per share rose by 69 per cent for the full year. When expressed at current rates of exchange, earnings per share (BEIA) were up 11 per cent for the full year and earnings per share rose by 70 per cent.

In Western Europe, the success of Pro Activ, Culinesse and Bertolli in spreads and cooking products, the 4 Salti in Padella range of high quality frozen ready meals and the expansion of Slim Fast, led to a step-up in the growth rate for foods.

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