Anglo-Dutch consumer products behemoth Unilever reported earlier today [Thursday] that faster growth in the leading brands, a strong expansion of operating margin and excellent progress with the integration of Bestfoods and other acquisitions marked the highlights of a successful 2001.
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The company said that its success to date underpins its confidence that it will fully achieve its Path to Growth targets.
Underlying sales grew by 4% in the quarter, and by 4% for the year. The impact of Unilever’s disposal program led to Q4 sales being 1% lower than last year. Sales for the year, including the impact of acquisitions and disposals, were 11% ahead.
Operating profit, before exceptional items and amortization of goodwill and intangibles, increased by 21% in the quarter and by 28% for the year. Operating margin (beia) in the quarter was 14.3%, an increase of 250 basis points over last year, and for the FY rose by 190 basis points to 13.9%.
Amortization of goodwill and intangibles was €368m (US$320m) in the Q4 and €1,436m for the year, including €1,186m for Bestfoods.
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By GlobalDataNet interest was €1,058m higher than last year, reflecting the increased level of borrowings related to acquisitions. Q4 interest was €395m, down from €449m in the same period last year, as we benefited from the continuing strong cash flow from operations, proceeds of business disposals, and lower interest rates.
Exceptional items for the year were €620m, which includes €1,564m of restructuring investment and profits on disposals of €944m. Of the latter, €828m relates to the profit on the sale of the brands to secure regulatory approval for our acquisition of Bestfoods. Associated costs included in operating profit (beia) were €393m for the year, of which €127m fell in the Q4.
The effective tax rate for the year is 43% and reflects the non-tax-deductibility of Bestfoods goodwill amortization and a tax rate on the net exceptional charges of 39%. The underlying rate of tax for normal trading operations is 33%.
Net profit for the year is up 66% to €1,858m. Excluding exceptional items and goodwill amortization, net profit rose by €374m, or by 12%.
Earnings per share rose by 43% in the quarter and by 12% for the full year. Earnings per share rose by 69% for the full year.
Company chairmen N. FitzGerald and A. Burgmans commented: “The past year has shown the great strength of our business and underlined our ability to execute substantial change. We have made excellent progress with the integration of Bestfoods, implemented our new Divisional structure and dealt effectively with a more challenging business environment. Our performance is a testimony to the everyday appeal of our brands and particularly to the professionalism of our people.
“A step-up in the growth of our leading brands, a record operating margin, strong cash flow and the continued reshaping of our portfolio all provide confidence about the plans we have in place and our ability to deliver against them – on time and in full.”
FINANCIAL HIGHLIGHTS
Constant exchange rates (2000 average) Current
exchange rates
Fourth Full Year
Quarter 2001 EUR Millions 2001 Full Year 2001
————- ———— ————–
13,399 (1)% Total Turnover(a) 53,400 11% 52,206 9%
Total Operating
1,919 21% profit(a) – beia(b) 7,416 28% 7,269 25%
542 173% Pre-tax profit / (loss) 3,698 35% 3,624 33%
228 123% Net profit / (loss) 1,858 66% 1,838 66%
1,006 41% Net profit – beia(b) 3,602 12% 3,543 10%
Per N.V. share
(EUR 0.51), Euro
—————-
0.22 122% Earnings per share (EPS) 1.84 69% 1.82 70%
1.01 43% EPS (beia)(b) 3.61 12% 3.55 11%
Per PLC share
(1.4p), Eurocent
—————-
3.27 122% Earnings per share (EPS) 27.57 69% 27.27 70%
15.16 43% EPS (beia)(b) 54.19 12% 53.29 11%
(a) Includes our share of Joint Ventures
(b) Before exceptional items and amortization of goodwill and
intangibles
