3rd Quarter Results
Unilever PLC
02 November 2006
THIRD QUARTER AND NINE MONTH RESULTS 2006 AND INTERIM DIVIDENDS
Broad-based growth. Margin development in line with our expectations.
FINANCIAL HIGHLIGHTS
(unaudited)
Third Quarter 2006 € million Nine Months 2006
------------------------- -------------------------
Current Current Constant Current Current Constant
rates rates rates rates rates rates
Continuing operations:
10 122 2% 4% Turnover 29 915 4% 3%
1 501 (3)% (2)% Operating profit 4 346 7% 5%
1 128 (20)% (19)% Pre-tax profit 3 789 4% 2%
779 (22)% (21)% Net profit from continuing operations 2 787 5% 4%
812 (45)% (45)% Net profit from total operations 2 915 (10)% (11)%
0.25 (24)% (24)% EPS from continuing operations (Euros) 0.90 5% 4%
0.25 (47)% (47)% EPS from total operations (Euros) 0.94 (11)% (12)%
KEY FEATURES
• Underlying sales growth of 4.8% in the quarter and 3.9% in the first
nine months.
• Operating margin of 14.8% in the quarter and 14.5% in the first nine
months.
• Increased investment in advertising and promotions behind key mid-year
innovations.
• Pricing actions and productivity gains fully offset cost increases.
• Provision of €300 million taken for possible compensation payments
relating to the 2005 conversion of preference shares, issued by Unilever N.V.
in 1999.
• Interim dividend of €0.23 for NV and 15.62p for PLC.
• €750 million additional one-off dividend (€0.26 for NV and 17.66p for
PLC), replacing 2006 share buy-back of €500 million. Share buy-back programme
of €1.5 billion planned to commence in 2007.
GROUP CHIEF EXECUTIVE'S COMMENT
We continue to see good progress with another quarter of broad-based growth. All
categories and regions grew, with a notable contribution from Europe. Stronger
innovation and additional investment behind our priorities are driving the
growth of our brands.
Pricing actions and continued productivity gains fully offset higher than
expected input costs. The 'One Unilever' programme is making a substantial
contribution to our cost competitiveness drive. Our global capability programme,
now also extended to research and development, is progressing well.
During the quarter we announced the sale of frozen foods businesses in Europe at
a good price and expect to complete it shortly. Also we have announced today an
increase in the cash to be returned to shareholders in 2006 and plans for
additional returns through share buy-backs, starting in 2007.
I am pleased with the sustained improvement in the top line, maintaining the
momentum of the first half. Looking ahead our priority is to improve our
operating margin, while delivering our growth ambitions. We are confident we
will achieve this through a combination of savings, mix improvement and
appropriate pricing actions.
Patrick Cescau, Group Chief Executive
2 November 2006
In the following commentary, sales growth is stated on an underlying basis at
constant exchange rates and excluding the effects of acquisitions and disposals.
Turnover includes the impact of exchange rates and acquisitions and disposals.
Unilever uses 'constant rate' and 'underlying' measures primarily for internal
performance analysis and targeting purposes. Unilever believes that such
measures provide additional information for shareholders on underlying business
performance trends. Such measures are not defined under IFRSs or US GAAP and are
not intended to be a substitute for GAAP measures of turnover, profit and cash
flow.
TURNOVER
Turnover increased by 4.4% in the first nine months, with 3.9% underlying sales
growth. Favourable currency movements added 1.4% with disposals accounting for
the remainder of the change in turnover. In the third quarter underlying sales
grew by 4.8%.
Pricing has made an increasing contribution with 0.9% in the first nine months
and 1.2% in the quarter. All regions and categories grew in both the year to
date and the quarter. A strong third quarter for European ice cream added 0.4%
to overall third quarter growth and made up for a relatively weak start to the
ice cream season.
OPERATING MARGIN
The operating margin for the first nine months at 14.5% was 0.3 percentage
points higher than a year ago, while the quarter at 14.8% was 0.8 percentage
points lower. Before the impact of restructuring, disposals and impairments, the
operating margin would have been 0.7 percentage points lower for both the first
nine months and the quarter.
Investment behind our brands has been stepped up in priority categories and
regions. Advertising and promotions as a percentage of turnover increased by 0.6
points in the first nine months and by 0.8 points in the third quarter.
Gross margins were in line with last year in the first nine months. Higher
commodity costs were fully offset by savings programmes, the benefits of volume
growth and mix, and a positive contribution from pricing.
NET PROFIT AND EARNINGS PER SHARE
Net finance costs benefited from a lower level of net debt, an improved mix
between countries and the effect of a higher asset base in our pension funds.
Finance costs for the quarter also included a
€300 million provision relating to preference shares. In September 2006
investigators appointed by the Dutch Enterprise Chamber published their report
into the issuance and subsequent conversion of Unilever N.V.'s 1999 Preference
Shares. The Unilever Board established a Committee, chaired by Professor Wim
Dik, to consider the Company's response. The Committee has explored the
possibility of a settlement. It is expected that the Board, which has as yet
made no decision on this matter, will consider the Committee's recommendation
shortly.
The tax rate was 26% for the first nine months compared with 28% last year. The
lower rates this year include a better country mix and other improvements. In
the third quarter the tax rate was 31%, which is adversely affected by a
relatively low assumed rate for the tax credit on the preference share
provision.
Share of net profit from joint ventures was ahead of last year due to continued
growth in the partnerships between Lipton and Pepsi for ready-to-drink tea.
Net profit from continuing operations increased by 5% in the first nine months
and decreased by 22% in the quarter, following the preference shares provision.
Net profit, including discontinued operations, was down by 45% in the quarter,
additionally reflecting the profit on disposal of UCI in the third quarter of
last year.
EPS from continuing operations increased by 5% in the first nine months.
CASH FLOW
Net cash flow from operating activities was €0.3 billion higher than last year
in the first nine months. Lower tax payments more than offset higher cash
payments to pension schemes in the period. The seasonal outflow of working
capital was in line with last year. Capital expenditure has been increased
behind our innovation programme.
Net debt has been reduced by €1.3 billion since the start of the year.
BALANCE SHEET
The Euro strengthened against a number of currencies, most significantly the US
dollar, reducing balance sheet values.
DIVIDENDS AND SHARE BUY BACKS
The sale of European frozen foods businesses is now expected to complete very
shortly and for a price at the top end of our expectations. We have not invested
any significant amounts in acquisitions. We have therefore decided to return an
additional €250 million to shareholders this year over and above the originally
planned €500 million share buy-back. The simplest way of achieving this is
through a one-off dividend of €750 million to be paid at the same time as the
normal interim dividend. Looking forward, we plan a share buy-back programme of
€1.5 billion, commencing in 2007.
PERFORMANCE BY REGION
EUROPE (38% OF SALES)
Underlying sales grew by 1.4% in the first nine months, and by 3.5% in the third
quarter. Growth is mainly volume driven and in aggregate across categories we
are growing in line with our markets.
A key driver of the overall improvement has been the impact of Vitality-led
innovation in savoury, spreads and leaf tea. Ice cream grew for the season
overall, with a strong third quarter adding 1.4% to European growth in the
quarter. This made up for lower ice cream sales in the first half year.
Personal care grew well through innovation and consumer activation. We have lost
some share in laundry in competitive markets.
There were improvements in a number of key countries in the third quarter. The
UK has returned to growth and France and Germany also performed better. The
Netherlands continues to move ahead strongly and Russia is growing well.
The theme of Vitality runs clearly through the innovation programme. AdeZ
drinks, combining the goodness of soya with the refreshment, taste and health of
fruit juice have been launched in the UK, building on success in Latin America.
A range of Knorr bouillon cubes with selected natural ingredients and a better,
richer taste has been rolled out across the region and Vie 'one shot' fruit and
vegetable drinks are now available in ten countries. 'Fresh' soups in pouches
with premium ingredients and tasty recipes have been rolled out to a further
seven countries.
Product launches in Home and Personal Care with clear functional or emotional
benefits are being rolled out rapidly across the region. Dove 'Summer Glow',
offers gentle self-tanning from a trusted brand and the latest Axe fragrance
'Click' is being introduced. New Cif Power Cream combines convenience with high
performance.
The operating margin for the first nine months at 15.0% was 1.8 percentage
points lower than last year. This includes the impact of input cost increases,
competitive pricing, higher net costs for restructuring and disposals, and
higher investment in advertising and promotions. These were only partly offset
by savings programmes.
THE AMERICAS (35% OF SALES)
Underlying sales growth has accelerated progressively through the year, with
3.5% in the first nine months and 4.1% in the third quarter. This is mainly
driven by volume gains with price increases adding 1.4% in the first nine
months. Markets in the US continue to grow solidly. In the rest of the region
Home and Personal Care markets are buoyant, with Foods somewhat slower.
Sales in the US have grown by around 3% in both the quarter and the year to
date. We have gained market share in Foods, including further gains in ice cream
and the continued success of Bertolli frozen meals and Country Crock side
dishes. Lipton ready-to-drink tea has also achieved a substantial share gain,
which is not consolidated in turnover but shows through in the profit from joint
ventures. There has been good innovation-driven growth and share gains in
deodorants and hair care, with sales of the newly launched Sunsilk on plan.
Sales in Brazil picked up in the third quarter with strong growth in personal
care categories and laundry. Foods sales in Brazil grew only modestly in the
face of slow markets and strong local price competition.
In Mexico, sales were below last year in both the quarter and the year to date.
Home and Personal Care returned to growth in the quarter but Foods declined in
sluggish markets.
There was strong growth elsewhere in the region with a number of countries
growing more than 10%.
Products introduced this year in the US include further development of the
Bertolli premium frozen meal range, Wishbone salad 'spritzers', with one calorie
per spray, and Lipton pyramid tea bags. Launches under the Breyers ice cream
brand include more creamy varieties of 'double churn'.
New Knorr soups and bouillons across the region cater for local flavour and
tastes while sharing common product platforms. The highly successful AdeS
nutritional drink has been extended with a 'light' variant, new fruit flavours
and the launch of Soymilk in Brazil and Mexico.
We have strengthened our hair portfolio in the US. Sunsilk, with ranges tailored
to tackle individual hair 'dramas', was launched in the middle of the year. This
followed the successful relaunch of the Suave 'Professionals' range with
improved margins. The Dove skin range has been further extended throughout the
region including the 'glow' and 'no white marks' products which meet clear
consumer needs. In Brazil, the Omo laundry brand has been further strengthened
with a new top performance product and 'baby' and 'foam control' variants.
The operating margin for the first nine months, at 15.5%
was 3.8 percentage points higher than last year which included the impairment
charge for Slim Fast in the second quarter. Before this, the operating margin
was in line with last year. Price increases and savings programmes fully offset
the impact of increased investment in advertising and promotions and higher
input costs.
ASIA AFRICA (27% OF SALES)
Underlying sales grew by 8.0% in the first nine months and by 7.5% in the third
quarter. While growth remains mainly volume driven, there was a further step up
in price in the third quarter, to 2.3%, as we took action to mitigate the
effects of higher input costs.
Markets remain generally buoyant and our aggregate market shares across the
region remain stable, as we delivered good growth from strong positions across
all categories.
India has sustained double-digit sales increases across almost all categories. A
mix of global, regional and local brands are driving growth, notably Surf,
Wheel, Lux, Lifebuoy and Clinic. Tea rebounded strongly after a weaker first
half.
China has been very strong this year with another quarter of excellent growth.
We have gained share in most categories through better distribution and
innovation behind brands such as Omo, Zonghua, Lux and Pond's. Lipton teas also
performed well.
Indonesia, Vietnam and Turkey have all sustained very good momentum through the
year. Sales in South Africa slowed in the third quarter through low price
competition in laundry, but Foods and personal care continued to move ahead
well.
In the developed markets, an improved performance in Australia has been
sustained, while Japan remains difficult.
Increasingly, innovation activity has been driven globally and regionally rather
than locally. The new Sunsilk range has been introduced in most major markets
and in laundry the global 'Dirt is Good' positioning is now in place across the
region. The latest Axe/Lynx fragrance, 'Click' has been introduced in Australia
and New Zealand. Lux 'Super Damage Repair System' for hair has been launched in
Japan and China.
In Foods, low unit priced Knorr bouillon cubes, already successful in Latin
America, have been brought to the region and Green Tea innovations are being
rolled out extensively. In South Africa, the new Rama brand communicates the
healthy oils in the product, a theme being used elsewhere around the world.
The operating margin for the first nine months at 12.6% was 0.8 percentage
points lower than a year ago, due to increased investment in advertising and
promotions. Price increases and savings programmes offset the impact of higher
input costs.
SAFE HARBOUR STATEMENT: This announcement may contain forward-looking
statements, including 'forward-looking statements' within the meaning of the
United States Private Securities Litigation Reform Act of 1995. Words such as
'expects', 'anticipates', 'intends' or the negative of these terms and other
similar expressions of future performance or results and their negatives are
intended to identify such forward-looking statements. These forward-looking
statements are based upon current expectations and assumptions regarding
anticipated developments and other factors affecting the Group. They are not
historical facts, nor are they guarantees of future performance. Because these
forward-looking statements involve risks and uncertainties, there are important
factors that could cause actual results to differ materially from those
expressed or implied by these forward-looking statements, including, among
others, competitive pricing and activities, consumption levels, costs, the
ability to maintain and manage key customer relationships and supply chain
sources, currency values, interest rates, the ability to integrate acquisitions
and complete planned divestitures, physical risks, environmental risks, the
ability to manage regulatory, tax and legal matters and resolve pending matters
within current estimates, legislative, fiscal and regulatory developments,
political, economic and social conditions in the geographic markets where the
Group operates and new or changed priorities of the Boards. Further details of
potential risks and uncertainties affecting the Group are described in the
Group's filings with the London Stock Exchange, Euronext Amsterdam and the US
Securities and Exchange Commission, including the Annual Report and Accounts on
Form 20-F. These forward-looking statements speak only as of the date of this
document. Except as required by any applicable law or regulation, the Group
expressly disclaims any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statements contained herein to
reflect any change in the Group's expectations with regard thereto or any change
in events, conditions or circumstances on which any such statement is based.
CONDENSED INTERIM FINANCIAL STATEMENTS
INCOME STATEMENT
(unaudited)
Third Quarter € million Nine Months
------------------- -------------------
2006 2005 Increase/ 2006 2005 Increase/
(Decrease) (Decrease)
Current Constant Current Constant
rates rates rates rates
Continuing operations:
10 122 9 935 2% 4% Turnover 29 915 28 644 4% 3%
1 501 1 551 (3)% (2)% Operating profit 4 346 4 062 7% 5%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
After (charging)/crediting:
(74) (81) Restructuring (235) (130)
(4) 10 Business disposals and 151 (245)
impairments
------ ------ ------ ------ -------------------- ------ ------ ------ ------
(403) (158) Net finance costs (638) (461)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
33 21 Finance income 101 122
(149) (166) Finance costs (473) (543)
(300) - Preference shares provision (300) -
13 (13) Pensions and similar 34 (40)
obligations
------ ------ ------ ------ -------------------- ------ ------ ------ ------
17 13 Share in net profit/(loss) of 51 32
joint ventures
(2) 2 Share in net profit/(loss) of 4 (6)
associates
15 3 Other income from non-current 26 24
------ ------ investments ------ ------
1 128 1 411 (20)% (19)% Profit before taxation 3 789 3 651 4% 2%
(349) (414) Taxation (1 002) (1 005)
------ ------ ------ ------
779 997 (22)% (21)% Net profit from continuing 2 787 2 646 5% 4%
operations
33 477 Net profit/(loss) from 128 593
------ ------ discontinued operations ------ ------
812 1 474 (45)% (45)% Net profit for the period 2 915 3 239 (10)% (11)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Attributable to:
75 57 Minority interests 202 157
737 1 417 (48)% (48)% Shareholders' equity 2 713 3 082 (12)% (13)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Combined earnings per share
0.25 0.49 (47)% (47)% Total operations (Euros) 0.94 1.06 (11)% (12)%
0.24 0.47 (47)% (47)% Total operations - diluted 0.91 1.02 (11)% (12)%
(Euros)
0.25 0.32 (24)% (24)% Continuing operations (Euros) 0.90 0.85 5% 4%
0.24 0.32 (24)% (24)% Continuing operations - 0.87 0.83 5% 4%
diluted (Euros)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
STATEMENT OF RECOGNISED INCOME AND EXPENSE
(unaudited)
€ million Nine Months
---------------
2006 2005
Fair value gains/(losses) on financial instruments net of tax (551) 21
Actuarial gains/(losses) on pension schemes net of tax 6 14
Currency retranslation gains/(losses) net of tax 323 359
--------- ---------
Net income/(expense) recognised directly in equity (222) 394
Net profit for the period 2 915 3 239
--------- ---------
Total recognised income and expense for the period 2 693 3 633
----------------------------------------- --------- ---------
Attributable to:
Minority interests 182 200
Shareholders' equity 2 511 3 433
----------------------------------------- --------- ---------
MOVEMENTS IN EQUITY
(unaudited)
€ million Nine Months
---------------
2006 2005
Equity at 1 January 8 765 6 515
Total recognised income and expense for the period 2 693 3 633
Dividends (1 268) (1 229)
Conversion of preference shares - 930
(Purchase)/sale of treasury stock 2 (600)
Share option credit 92 124
Dividends paid to minority shareholders (170) (166)
Currency retranslation gains/(losses) net of tax (8) 15
Other movements in equity 10 -
--------- ---------
Equity at the end of the period 10 116 9 222
BALANCE SHEET
(unaudited)
€ million As at As at As at
30 31 1
September December October
2006 2005 2005
--------- --------- ---------
Non-current assets
--------------------
Goodwill and intangible assets 17 527 18 055 17 959
Property, plant and equipment 6 198 6 492 6 513
Pension asset for funded schemes in surplus 1 128 1 036 749
Deferred tax assets 1 373 1 703 1 520
Other non-current assets 1 099 1 072 1 207
--------- --------- ---------
Total non-current assets 27 325 28 358 27 948
Assets held for sale 509 217 133
Current assets
----------------
Inventories 3 930 4 107 4 319
Trade and other current receivables 4 657 4 830 5 082
Other financial assets 320 335 356
Cash and cash equivalents 1 440 1 529 2 061
--------- --------- ---------
Total current assets 10 347 10 801 11 818
Current liabilities
---------------------
Borrowings due within one year (5 735) (5 942) (6 101)
Trade payables and other current liabilities (7 909) (8 658) (8 400)
Restructuring and other provisions (780) (644) (658)
--------- --------- ---------
Total current liabilities (14 424) (15 244) (15 159)
--------- --------- ---------
Net current assets/(liabilities) (4 077) (4 443) (3 341)
--------- --------- ---------
Total assets less current liabilities 23 757 24 132 24 740
Non-current liabilities
-------------------------
Borrowings due after one year 5 025 6 457 6 823
Pension liability for funded schemes in deficit 2 051 2 415 2 396
Pension liability for unfunded schemes 3 992 4 202 3 993
Restructuring and other provisions 788 732 706
Deferred tax liabilities 931 933 807
Other non-current liabilities 617 602 779
--------- --------- ---------
Total non-current liabilities 13 404 15 341 15 504
Liabilities held for sale 237 26 14
Equity
--------
Shareholders' equity 9 704 8 361 8 813
Minority interests 412 404 409
--------- --------- ---------
Total equity 10 116 8 765 9 222
--------- --------- ---------
Total capital employed 23 757 24 132 24 740
CASH FLOW STATEMENT
(unaudited)
€ million Nine Months
---------------
2006 2005
Operating activities
----------------------
Cash flow from operating activities 3 830 4 009
Income tax paid (718) (1 205)
--------- ---------
Net cash flow from operating activities 3 112 2 804
Investing activities
----------------------
Interest received 79 156
Net capital expenditure (660) (509)
Acquisitions and disposals 182 740
Other investing activities 55 354
--------- ---------
Net cash flow from/(used in) investing activities (344) 741
Financing activities
----------------------
Dividends paid on ordinary share capital (1 337) (1 229)
Interest and preference dividends paid (400) (472)
Change in borrowings and finance leases (1 205) (333)
Purchase of treasury stock (5) (800)
Other financing activities (178) (165)
--------- ---------
Net cash flow from/(used in) financing activities (3 125) (2 999)
--------- ---------
Net increase/(decrease) in cash and cash equivalents (357) 546
Cash and cash equivalents at the beginning of the year 1 265 1 406
Effect of foreign exchange rate changes 317 (142)
--------- ---------
Cash and cash equivalents at the end of period 1 225 1 810
ANALYSIS OF NET DEBT
(unaudited)
€ million As at As at
30 31
September December
2006 2005
--------- ---------
Total borrowings (10 760) (12 399)
--------- ---------
Borrowings due within one year (5 735) (5 942)
Borrowings due after one year (5 025) (6 457)
--------- ---------
Cash and cash equivalents as per balance sheet 1 440 1 529
--------- ---------
Cash and cash equivalents as per cash flow statement 1 225 1 265
Add bank overdrafts deducted therein 215 265
Less cash and cash equivalents in assets/liabilities held for - (1)
sale
--------- ---------
Other financial assets 320 335
Derivatives and finance leases included in other receivables and (165) 33
other liabilities
--------- ---------
Net debt (9 165) (10 502)
GEOGRAPHICAL ANALYSIS
(unaudited)
Continuing operations - Third Quarter
€ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 3 805 3 409 2 721 9 935
2006 3 905 3 435 2 782 10 122
Change 2.6% 0.7% 2.3% 1.9%
Impact of:
Exchange rates 0.1% (2.7)% (4.1)% (2.0)%
Acquisitions 0.0% 0.2% 0.0% 0.1%
Disposals (0.9)% (0.8)% (0.8)% (0.8)%
Underlying sales growth 3.5% 4.1% 7.5% 4.8%
---------------------- -------- -------- -------- --------
Price 0.3% 1.3% 2.3% 1.2%
Volume 3.1% 2.7% 5.0% 3.5%
---------------------- -------- -------- -------- --------
Operating profit
2005 653 526 372 1 551
2006 591 547 363 1 501
Change current rates (9.4)% 3.9% (2.3)% (3.2)%
Change constant rates (9.3)% 5.2% 1.9% (1.8)%
Operating margin
2005 17.2% 15.4% 13.7% 15.6%
2006 15.1% 15.9% 13.1% 14.8%
Includes restructuring, business
disposals and impairments
2005 (0.9)% (0.6)% (0.7)% (0.7)%
2006 (1.1)% (0.7)% (0.5)% (0.8)%
Continuing operations - Nine Months
€ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 11 322 9 658 7 664 28 644
2006 11 385 10 331 8 199 29 915
Change 0.6% 7.0% 7.0% 4.4%
Impact of:
Exchange rates 0.1% 3.9% 0.0% 1.4%
Acquisitions 0.0% 0.1% 0.0% 0.0%
Disposals (1.0)% (0.6)% (1.0)% (0.9)%
Underlying sales growth 1.4% 3.5% 8.0% 3.9%
---------------------- -------- -------- -------- --------
Price (0.1)% 1.4% 1.6% 0.9%
Volume 1.5% 2.1% 6.3% 3.0%
---------------------- -------- -------- -------- --------
Operating profit
2005 1 906 1 132 1 024 4 062
2006 1 712 1 603 1 031 4 346
Change current rates (10.1)% 41.5% 0.7% 7.0%
Change constant rates (10.2)% 35.8% 0.5% 5.5%
Operating margin
2005 16.8% 11.7% 13.4% 14.2%
2006 15.0% 15.5% 12.6% 14.5%
Includes restructuring, business
disposals and impairments
2005 0.0% (4.0)% 0.1% (1.3)%
2006 (0.6)% (0.2)% 0.1% (0.3)%
Operating profit of discontinued operations - Third Quarter
€ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 43 - - 43
2006 43 - - 43
Operating profit of discontinued operations - Nine Months
€ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 192 20 - 212
2006 182 - - 182
PRODUCT AREA ANALYSIS
(unaudited)
Continuing operations - Third Quarter
€ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 3 322 2 082 5 404 2 760 1 771 4 531 9 935
2006 3 321 2 170 5 491 2 870 1 761 4 631 10 122
Change 0.0% 4.2% 1.6% 4.0% (0.6)% 2.2% 1.9%
Impact of:
Exchange rates (1.8)% (2.0)% (1.9)% (1.9)% (2.7)% (2.2)% (2.0)%
Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1%
Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%
Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8%
growth
Operating profit
2005 501 393 894 493 164 657 1 551
2006 457 393 850 492 159 651 1 501
Change current rates (8.8)% (0.2)% (5.0)% 0.0% (2.9)% (0.7)% (3.2)%
Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%
rates
Operating margin
2005 15.1% 18.9% 16.6% 17.9% 9.2% 14.5% 15.6%
2006 13.8% 18.1% 15.5% 17.2% 9.0% 14.1% 14.8%
-------- --------
Continuing operations - Nine Months
€ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 9 825 5 871 15 696 7 733 5 215 12 948 28 644
2006 10 058 6 162 16 220 8 336 5 359 13 695 29 915
Change 2.4% 4.9% 3.3% 7.8% 2.8% 5.8% 4.4%
Impact of:
Exchange rates 1.1% 1.1% 1.1% 1.9% 1.4% 1.7% 1.4%
Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0%
Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%
Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9%
growth
Operating profit
2005 1 588 589 2 177 1 346 539 1 885 4 062
2006 1 494 937 2 431 1 442 473 1 915 4 346
Change current rates (5.9)% 59.1% 11.7% 7.2% (12.2)% 1.6% 7.0%
Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5%
rates
Operating margin
2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2%
2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5%
-------- --------
NOTES
(unaudited)
Basis of Preparation
The condensed interim financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the EU. These
are the same accounting policies as those used for preparation of the Annual
Report and Accounts for the year ended 31 December 2005.
The condensed interim financial statements, which comply with IAS 34, are shown
at current exchange rates, while percentage year-on-year changes are shown at
both current and constant exchange rates to facilitate comparison.
Discontinued operations
On 28 August 2006 Unilever announced that it had reached an agreement to sell
the majority of its European Frozen Foods business to the Permira Funds for €1.7
billion. The deal is expected to be completed during the fourth quarter. The
Unilever businesses being sold in this transaction include the frozen foods
operations in Austria, Belgium, France, Germany, Ireland, the Netherlands,
Portugal and the United Kingdom. The sale is expected to result in a one-off
profit, after tax, in excess of €1 billion, which will be reported under the
heading of discontinued operations.
The net cash flows attributable to the discontinued operations in respect of
operating, investing and financing activities for the first nine months were €83
million, €13 million and €(1) million respectively (2005:
€(9) million, €633 million and €(4) million). Earnings per share for
discontinued operations are given on page 13.
Taxation
The charge for the year to date includes €95 million (2005: €118 million)
relating to United Kingdom taxation.
Exchange rate conventions
The income statement on page 5, the statement of recognised income and expense
and the movements in equity on page 6 and the cash flow statement on page 8 are
translated at rates current in each period.
The balance sheet on page 7 and the analysis of net debt on page 8 are
translated at period-end rates of exchange.
Supplementary information in US dollars and sterling is available on our website
at www.unilever.com/ourcompany/investorcentre.
The financial statements attached do not constitute the full financial
statements within the meaning of Section 240 of the UK Companies Act 1985. Full
accounts for Unilever for the year ended 31 December 2005 have been delivered to
the Registrar of Companies. The auditors' report on these accounts was
unqualified and did not contain a statement under Section 237(2) or Section 237
(3) of the UK Companies Act 1985.
INTERIM AND ONE-OFF DIVIDENDS
The dividend information given below, including the comparative amounts for
2005, is expressed in terms of the nominal share values which have applied since
22 May 2006 following the split of NV shares and the consolidation of PLC shares
which were approved at the 2006 AGMs. The actual interim dividends paid in
respect of shares under the earlier denominations are also given below.
The Boards have declared interim and one-off dividends in respect of 2006 on the
ordinary shares at the following rates which are equivalent in value at the rate
of exchange applied under the terms of the Equalisation Agreement between the
two companies:
Unilever N.V.
2005 2006
Interim dividend €0.22 €0.23
One-off dividend €0.26
€0.49
Unilever PLC
2005 2006
Interim dividend 15.04p 15.62p
One-off dividend 17.66p
33.28p
The NV dividends will be payable as from 4 December 2006, to shareholders
registered at close of business on 2 November 2006.
The PLC dividends will be paid on 4 December 2006, to shareholders registered at
close of business on 10 November 2006.
Dividend on New York shares of NV
The NV interim and one-off dividends, when converted at the Euro/Dollar European
Central Bank rate of exchange on 1 November 2006, represent the following
amounts per New York Share of €0.16 before deduction of Netherlands withholding
tax.
2005 2006
Interim dividend $0.2638 $0.2934
One-off dividend $0.3316
$0.6250
The New York shares of NV will go ex-dividend on 3 November 2006; US dollar
checks for the combined interim and one-off dividends, after deduction of
Netherlands withholding tax at the appropriate rate, will be mailed on 1
December 2006, to holders of record of New York shares at the close of business
on 7 November 2006. The dividend will be payable on 4 December 2006.
Dividend on American Depositary Receipts of PLC
Each American Depositary Receipt of PLC represents one 3 1/9p ordinary share of
PLC. When converted at the Bank of England Sterling/Dollar rate of exchange on
1 November 2006, the interim and one-off dividends for holders resident in the
US will therefore be as follows:
2005 2006
Interim dividend $0.2655 $0.2983
One-off dividend $0.3372
$0.6355
The American Depositary Receipts of PLC will go ex-dividend on 8 November 2006;
US dollar checks for the combined interim and one-off dividends will be mailed
on 1 December 2006 to holders of record of American Depositary Receipts at the
close of business on 10 November 2006. The dividend will be payable on 4
December 2006.
Interim dividends paid in 2005
The actual interim dividends paid in 2005 were as follows:
€0.66 per €0.51 ordinary share of NV;
6.77p per 1.4p ordinary share of PLC;
US $0.791472 per €0.51 New York share of NV; and
US $0.4779 per 5.6p ADR of PLC.
Dividend reinvestment plans
It should be noted that the one-off dividend will automatically be re-invested
along with the interim dividend for shareholders participating in the various
Unilever dividend reinvestment plans (DRIP).
If those shareholders would prefer to receive the one-off and interim dividends
as cash they will need to withdraw from the DRIP for this dividend. Shareholders
will then need to re-join the DRIP after the receipt of the cash dividend if
they wish for their future dividends to be re-invested. The last date on which a
change of election must be received by the administrators of each DRIP plan is
as follows:
Unilever N.V. 21 November 2006
Unilever PLC 13 November 2006
Unilever N.V. New York shares 6 November 2006
Unilever PLC ADRs 9 November 2006
For further information and queries on your participation we advise you to
contact your bank, broker or DRIP Administrator.
EARNINGS PER SHARE
(unaudited)
Combined earnings per share
The combined earnings per share calculations are based on the average number of
share units representing the combined ordinary shares of NV and PLC in issue
during the period, less the average number of shares held as treasury stock.
In calculating diluted earnings per share, a number of adjustments are made to
the number of shares, principally the following: (i) conversion into PLC
ordinary shares in the year 2038 of shares in a group company under the
arrangements for the variation of the Leverhulme Trust; (ii) conversion of the
€0.05 NV preference shares (up to the point of conversion); and (iii) the
exercise of share options by employees. Earnings per share attributable to
discontinued operations were as follows:
2006 2005
Third Quarter:
Basic EPS € 0.00 € 0.17
Diluted EPS € 0.00 € 0.15
Nine Months:
Basic EPS € 0.04 € 0.21
Diluted EPS € 0.04 € 0.19
Earnings per share for total operations for the nine months
2006 2005
--------- ---------
Combined EPS Thousands of units
---------------
Average number of combined share units 2 882 122 2 920 224
€ million
--------- ---------
Net profit attributable to shareholders' equity 2 713 3 082
--------- ---------
Combined EPS (Euros) 0.94 1.06
--------- ---------
Combined EPS - Diluted Thousands of units
---------------
Adjusted average number of combined share units 2 968 519 3 015 309
€ million
---------------
Adjusted net profit attributable to shareholders' equity 2 713 3 085
--------- ---------
Combined EPS - diluted (Euros) 0.91 1.02
--------- ---------
Earnings per share in US Dollars and Sterling
--------- ---------
Combined EPS (Dollars) 1.17 1.33
Combined EPS - diluted (Dollars) 1.14 1.29
--------- ---------
--------- ---------
Combined EPS (Pounds) 0.64 0.72
Combined EPS - diluted (Pounds) 0.63 0.70
--------- ---------
DATES
The results for the fourth quarter and for the year 2006 will be published on
8 February 2007.
ENQUIRIES: UNILEVER PRESS OFFICE
+44 (0) 20 7822 6805/6010
Internet: www.unilever.com
E-mail: press-office.london@unilever.com
2 November 2006
US DOLLAR SUPPLEMENT TO THE UNILEVER THIRD QUARTER AND NINE MONTHS RESULTS 2006
AND INTERIM DIVIDENDS
This document is a supplement to the Unilever third quarter and nine Months
results 2006 and is prepared for reference purposes only, Unilever's reporting
currency is the Euro. The income statement, statement of recognised income and
expense, movements in equity and cash flow statement are translated at rates
current in each period. These rates were €1 = US $1.24 for the first nine months
of 2006 and €1 = US $1.26 for the first nine months of 2005. The balance sheet
is translated at period-end rates of exchange. These were €1 = US $1.27 at
30 September 2006, €1 = US $1.18 at 31 December 2005 and €1 = US $1.20 at
1 October 2005. Certain items in the income statement and statement of
recognised income and expense, notably currency retranslation recognised on the
disposal of businesses, will not reflect the result which would arise if the
reporting currency were to be US dollar.
INCOME STATEMENT
(unaudited)
Third Quarter US $ million Nine Months
------------------- ---------------------------------
2006 2005 Increase/ 2006 2005 Increase/
(Decrease) (Decrease)
Current Constant Current Constant
rates rates rates rates
Continuing operations:
12 869 12 125 6% 4% Turnover 37 214 36 091 3% 3%
1 907 1 902 0% (2)% Operating profit 5 407 5 118 6% 5%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
After (charging)/crediting:
(94) (101) Restructuring (292) (164)
(3) 18 Business disposals and 188 (309)
impairments
------ ------ ------ ------ -------------------- ------ ------ ------ ------
(505) (193) Net finance costs (794) (581)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
43 25 Finance income 126 154
(191) (202) Finance costs (589) (684)
(374) - Preference shares provision (374) -
17 (16) Pensions and similar 43 (51)
obligations
------ ------ ------ ------ -------------------- ------ ------ ------ ------
21 17 Share in net profit/(loss) of 64 41
joint ventures
(3) 2 Share in net profit/(loss) of 4 (8)
associates
21 4 Other income from non-current 34 31
------ ------ investments ------ ------
1 441 1 732 (17)% (19)% Profit before taxation 4 715 4 601 2% 2%
(444) (509) Taxation (1 247) (1 266)
------ ------ ------ ------
997 1 223 (18)% (21)% Net profit from continuing 3 468 3 335 4% 4%
operations
42 598 Net profit/(loss) from 159 747
------ ------ discontinued operations ------ ------
1 039 1 821 (43)% (45)% Net profit for the period 3 627 4 082 (11)% (11)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Attributable to:
96 71 Minority interests 252 199
943 1 750 (46)% (48)% Shareholders' equity 3 375 3 883 (13)% (13)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Combined earnings per share
$0.33 $0.60 (45)% (47)% Total operations (Dollars) $1.17 $1.33 (12)% (12)%
$0.32 $0.58 (45)% (47)% Total operations - diluted $1.14 $1.29 (12)% (12)%
(Dollars)
$0.32 $0.39 (21)% (24)% Continuing operations $1.12 $1.07 4% 4%
(Dollars)
$0.30 $0.38 (21)% (24)% Continuing operations - $1.08 $1.04 4% 4%
diluted (Dollars)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
STATEMENT OF RECOGNISED INCOME AND EXPENSE
(unaudited)
US $ million Nine Months
---------------
2006 2005
Fair value gains/(losses) on financial instruments net of tax (685) 26
Actuarial gains/(losses) on pension schemes net of tax 7 18
Currency retranslation gains/(losses) net of tax 1 096 (642)
--------- ---------
Net income/(expense) recognised directly in equity 418 (598)
Net profit for the period 3 626 4 082
--------- ---------
Total recognised income and expense for the period 4 044 3 484
----------------------------------------- --------- ---------
Attributable to:
Minority interests 252 209
Shareholders' equity 3 792 3 275
----------------------------------------- --------- ---------
MOVEMENTS IN EQUITY
(unaudited)
US $ million Nine Months
---------------
2006 2005
Equity at 1 January 10 378 8 899
Total recognised income and expense for the period 4 044 3 484
Dividends (1 577) (1 549)
Conversion of preference shares - 1 172
(Purchase)/sale of treasury stock 2 (756)
Share option credit 114 156
Dividends paid to minority shareholders (211) (209)
Currency retranslation gains/(losses) net of tax 55 (112)
Other movements in equity 12 -
--------- ---------
Equity at the end of the period 12 817 11 085
BALANCE SHEET
(unaudited)
US $ million As at As at As at
30 31 1
September December October
2006 2005 2005
--------- --------- ---------
Non-current assets
--------------------
Goodwill and intangible assets 22 207 21 376 21 587
Property, plant and equipment 7 853 7 686 7 828
Pension asset for funded schemes in surplus 1 429 1 226 901
Deferred tax assets 1 739 2 017 1 827
Other non-current assets 1 393 1 269 1 451
--------- --------- ---------
Total non-current assets 34 621 33 574 33 594
Assets held for sale 645 258 159
Current assets
----------------
Inventories 4 979 4 863 5 190
Trade and other current receivables 5 901 5 719 6 109
Other financial assets 405 396 428
Cash and cash equivalents 1 824 1 811 2 478
--------- --------- ---------
Total current assets 13 109 12 789 14 205
Current liabilities
---------------------
Borrowings due within one year (7 266) (7 036) (7 333)
Trade payables and other current liabilities (10 020) (10 251) (10 097)
Restructuring and other provisions (989) (762) (791)
--------- --------- ---------
Total current liabilities (18 275) (18 049) (18 221)
--------- --------- ---------
Net current assets/(liabilities) (5 166) (5 260) (4 016)
--------- --------- ---------
Total assets less current liabilities 30 100 28 572 29 737
Non-current liabilities
-------------------------
Borrowings due after one year 6 367 7 645 8 201
Pension liability for funded schemes in deficit 2 599 2 859 2 814
Pension liability for unfunded schemes 5 058 4 975 4 866
Restructuring and other provisions 998 866 849
Deferred tax liabilities 1 178 1 105 970
Other non-current liabilities 783 713 936
--------- --------- ---------
Total non-current liabilities 16 983 18 163 18 636
Liabilities held for sale 300 31 16
Equity
--------
Shareholders' equity 12 296 9 900 10 594
Minority interests 521 478 491
--------- --------- ---------
Total equity 12 817 10 378 11 085
--------- --------- ---------
Total capital employed 30 100 28 572 29 737
CASH FLOW STATEMENT
(unaudited)
US $ million Nine Months
---------------
2006 2005
Operating activities
----------------------
Cash flow from operating activities 4 765 5 052
Income tax paid (893) (1 519)
--------- ---------
Net cash flow from operating activities 3 872 3 533
Investing activities
----------------------
Interest received 98 197
Net capital expenditure (821) (642)
Acquisitions and disposals 226 933
Other investing activities 68 446
--------- ---------
Net cash flow from/(used in) investing activities (429) 934
Financing activities
----------------------
Dividends paid on ordinary share capital (1 664) (1 549)
Interest and preference dividends paid (497) (595)
Change in borrowings and finance leases (1 499) (419)
Purchase of treasury stock (6) (1 008)
Other financing activities (221) (208)
--------- ---------
Net cash flow from/(used in) financing activities (3 887) (3 779)
--------- ---------
Net increase/(decrease) in cash and cash equivalents (444) 688
Cash and cash equivalents at the beginning of the year 1 498 1 921
Effect of foreign exchange rate changes 497 (433)
--------- ---------
Cash and cash equivalents at the end of period 1 551 2 176
ANALYSIS OF NET DEBT
(unaudited)
US $ million As at As at
30 31
September December
2006 2005
--------- ---------
Total borrowings (13 633) (14 681)
--------- ---------
Borrowings due within one year (7 266) (7 036)
Borrowings due after one year (6 367) (7 645)
--------- ---------
Cash and cash equivalents as per balance sheet 1 824 1 811
--------- ---------
Cash and cash equivalents as per cash flow statement 1 551 1 498
Add bank overdrafts deducted therein 273 314
Less cash and cash equivalents in assets/liabilities held for - (1)
sale
--------- ---------
Other financial assets 405 396
Derivatives and finance leases included in other receivables and (209) 39
other liabilities
--------- ---------
Net debt (11 613) (12 435)
GEOGRAPHICAL ANALYSIS
(unaudited)
Continuing operations - Third Quarter
US $ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 4 635 4 166 3 324 12 125
2006 4 962 4 370 3 537 12 869
Change 7.0% 4.9% 6.4% 6.1%
Impact of:
Exchange rates 4.3% 1.4% (0.2)% 2.0%
Acquisitions 0.0% 0.2% 0.0% 0.1%
Disposals (0.9)% (0.8)% (0.8)% (0.8)%
Underlying sales growth 3.5% 4.1% 7.5% 4.8%
---------------------- -------- -------- -------- --------
Price 0.3% 1.3% 2.3% 1.2%
Volume 3.1% 2.7% 5.0% 3.5%
---------------------- -------- -------- -------- --------
Operating profit
2005 797 651 454 1 902
2006 751 695 461 1 907
Change current rates (5.6)% 6.8% 1.5% 0.3%
Change constant rates (9.3)% 5.2% 1.9% (1.8)%
Operating margin
2005 17.2% 15.6% 13.7% 15.7%
2006 15.1% 15.9% 13.0% 14.8%
Includes restructuring, business
disposals and impairments
2005 (0.9)% (0.6)% (0.7)% (0.7)%
2006 (1.1)% (0.7)% (0.5)% (0.8)%
Continuing operations - Nine Months
US $ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 14 265 12 170 9 656 36 091
2006 14 163 12 851 10 200 37 214
Change (0.7)% 5.6% 5.6% 3.1%
Impact of:
Exchange rates (1.1)% 2.5% (1.2)% 0.1%
Acquisitions 0.0% 0.1% 0.0% 0.0%
Disposals (1.0)% (0.6)% (1.0)% (0.9)%
Underlying sales growth 1.4% 3.5% 8.0% 3.9%
---------------------- -------- -------- -------- --------
Price (0.1)% 1.4% 1.6% 0.9%
Volume 1.5% 2.1% 6.3% 3.0%
---------------------- -------- -------- -------- --------
Operating profit
2005 2 401 1 427 1 290 5 118
2006 2 130 1 995 1 282 5 407
Change current rates (11.2)% 39.8% (0.6)% 5.7%
Change constant rates (10.2)% 35.8% 0.5% 5.5%
Operating margin
2005 16.8% 11.7% 13.4% 14.2%
2006 15.0% 15.5% 12.6% 14.5%
Includes restructuring, business
disposals and impairments
2005 0.0% (4.0)% 0.1% (1.3)%
2006 (0.6)% (0.2)% 0.1% (0.3)%
Operating profit of discontinued operations - Third Quarter
US $ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 52 (1) - 51
2006 55 - - 55
Operating profit of discontinued operations - Nine Months
US $ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 242 25 - 267
2006 226 - - 226
PRODUCT AREA ANALYSIS
(unaudited)
Continuing operations - Third Quarter
US $ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 4 048 2 544 6 592 3 374 2 159 5 533 12 125
2006 4 226 2 755 6 981 3 647 2 241 5 888 12 869
Change 4.4% 8.3% 5.9% 8.1% 3.8% 6.4% 6.1%
Impact of:
Exchange rates 2.5% 1.8% 2.3% 1.9% 1.6% 1.8% 2.0%
Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1%
Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%
Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8%
growth
Operating profit
2005 609 491 1 100 604 198 802 1 902
2006 583 496 1 079 627 201 828 1 907
Change current rates (4.2)% 0.9% (1.9)% 3.9% 2.0% 3.4% 0.3%
Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%
rates
Operating margin
2005 15.0% 19.3% 16.7% 17.9% 9.2% 14.5% 15.7%
2006 13.8% 18.0% 15.5% 17.2% 9.0% 14.1% 14.8%
-------- --------
Continuing operations - Nine Months
US $ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 12 378 7 398 19 776 9 744 6 571 16 315 36 091
2006 12 513 7 664 20 177 10 370 6 667 17 037 37 214
Change 1.1% 3.6% 2.0% 6.4% 1.5% 4.4% 3.1%
Impact of:
Exchange rates (0.2)% (0.2)% (0.2)% 0.6% 0.1% 0.3% 0.1%
Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0%
Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%
Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9%
growth
Operating profit
2005 2 001 742 2 743 1 696 679 2 375 5 118
2006 1 858 1 166 3 024 1 795 588 2 383 5 407
Change current rates (7.1)% 57.1% 10.2% 5.8% (13.4)% 0.3% 5.7%
Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5%
rates
Operating margin
2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2%
2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5%
-------- --------
EARNINGS PER SHARE FOR TOTAL OPERATIONS IN US DOLLARS FOR THE NINE MONTHS
2006 2005
-------- ---------
Combined EPS Thousands of units
----------------
Average number of combined share units 2 882 122 2 920 224
US $ million
----------------
Net profit attributable to shareholders' equity 3 375 3 883
-------- ---------
Combined EPS (Dollars) 1.17 1.33
-------- ---------
Combined EPS - Diluted Thousands of units
---------------
Adjusted average number of combined share units 2 968 519 3 015 309
US $ million
----------------
Adjusted net profit attributable to shareholders' equity 3 375 3 887
-------- ---------
Combined EPS - diluted (Dollars) 1.14 1.29
-------- ---------
STERLING SUPPLEMENT TO THE UNILEVER THIRD QUARTER AND NINE MONTHS RESULTS 2006
AND INTERIM DIVIDENDS
This document is a supplement to the Unilever third quarter and Nine Months
results 2006 and is prepared for reference purposes only, Unilever's reporting
currency is the Euro. The income statement, statement of recognised income and
expense, movement in equity and cash flow statement are translated at rates
current in each period. These rates were €1 = £0.68 for the first nine months of
2006 and €1 = £0.68 for the first nine months of 2005. The balance sheet is
translated at period-end rates of exchange. These were €1 = £0.68 at
30 September 2006, €1 = £0.69 at 31 December 2005 and €1 = £0.68 at
1 October 2005. Certain items in the income statement and statement of
recognised income and expense, notably currency retranslation recognised on the
disposal of businesses, will not reflect the result which would arise if the
reporting currency were to be sterling.
INCOME STATEMENT
(unaudited)
Third Quarter £ million Nine Months
------------------- -------------------
2006 2005 Increase/ 2006 2005 Increase/
(Decrease) (Decrease)
Current Constant Current Constant
rates rates rates rates
Continuing operations:
6 875 6 788 1% 4% Turnover 20 471 19 615 4% 3%
1 020 1 059 (4)% (2)% Operating profit 2 974 2 781 7% 5%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
After (charging)/crediting:
(60) (55) Restructuring (161) (89)
(3) 7 Business disposals and 103 (168)
impairments
------ ------ ------ ------ -------------------- ------ ------ ------ ------
(274) (108) Net finance costs (435) (316)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
22 15 Finance income 69 84
(101) (114) Finance costs (323) (372)
(204) - Preference shares provision (204) -
9 (9) Pensions and similar 23 (28)
obligations
------ ------ ------ ------ -------------------- ------ ------ ------ ------
11 9 Share in net profit/(loss) of 35 22
joint ventures
(1) 2 Share in net profit/(loss) of 3 (4)
associates
10 3 Other income from non-current 17 17
------ ------ investments ------ ------
766 965 (21)% (19)% Profit before taxation 2 594 2 500 4% 2%
(237) (283) Taxation (686) (688)
------ ------ ------ ------
529 682 (23)% (21)% Net profit from continuing 1 908 1 812 5% 4%
operations
21 327 Net profit/(loss) from 87 406
------ ------ discontinued operations ------ ------
550 1 009 (45)% (45)% Net profit for the period 1 995 2 218 (10)% (11)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Attributable to:
51 40 Minority interests 138 108
499 969 (48)% (48)% Shareholders' equity 1 857 2 110 (12)% (13)%
------ ------ ------ ------ -------------------- ------ ------ ------ ------
------ ------ ------ ------ -------------------- ------ ------ ------ ------
Combined earnings per share
0.17 0.33 (48)% (47)% Total operations (Pounds) 0.64 0.72 (11)% (12)%
0.17 0.32 (48)% (47)% Total operations - diluted 0.63 0.70 (11)% (12)%
(Pounds)
0.16 0.22 (25)% (24)% Continuing operations 0.61 0.58 5% 4%
(Pounds)
0.16 0.22 (25)% (24)% Continuing operations - 0.60 0.57 5% 4%
diluted (Pounds)
------ ------ ------ ------ -------------------- ------ ------ ------ ------
STATEMENT OF RECOGNISED INCOME AND EXPENSE
(unaudited)
£ million Nine Months
---------------
2006 2005
Fair value gains/(losses) on financial instruments net of tax (377) 14
Actuarial gains/(losses) on pension schemes net of tax 4 10
Currency retranslation gains/(losses) net of tax 142 107
--------- ---------
Net income/(expense) recognised directly in equity (231) 131
Net profit for the period 1 995 2 218
--------- ---------
Total recognised income and expense for the period 1 764 2 349
----------------------------------------- --------- ---------
Attributable to:
Minority interests 140 132
Shareholders' equity 1 624 2 217
----------------------------------------- --------- ---------
MOVEMENTS IN EQUITY
(unaudited)
£ million Nine Months
---------------
2006 2005
Equity at 1 January 6 016 4 605
Total recognised income and expense for the period 1 764 2 349
Dividends (868) (842)
Conversion of preference shares - 637
(Purchase)/sale of treasury stock 1 (411)
Share option credit 63 85
Dividends paid to minority shareholders (116) (114)
Currency retranslation gains/(losses) net of tax (13) (8)
Other movements in equity 7 -
--------- ---------
Equity at the end of the period 6 854 6 301
BALANCE SHEET
(unaudited)
£ million As at As at As at
30 31 1
September December October
2006 2005 2005
--------- --------- ---------
Non-current assets
--------------------
Goodwill and intangible assets 11 874 12 393 12 270
Property, plant and equipment 4 199 4 456 4 450
Pension asset for funded schemes in surplus 764 711 512
Deferred tax assets 931 1 169 1 038
Other non-current assets 745 735 824
--------- --------- ---------
Total non-current assets 18 513 19 464 19 094
Assets held for sale 345 149 91
Current assets
----------------
Inventories 2 662 2 819 2 951
Trade and other current receivables 3 155 3 315 3 472
Other financial assets 217 230 243
Cash and cash equivalents 976 1 050 1 408
--------- --------- ---------
Total current assets 7 010 7 414 8 074
Current liabilities
---------------------
Borrowings due within one year (3 886) (4 079) (4 168)
Trade payables and other current liabilities (5 358) (5 942) (5 736)
Restructuring and other provisions (528) (442) (450)
--------- --------- ---------
Total current liabilities (9 772) (10 463) (10 354)
--------- --------- ---------
Net current assets/(liabilities) (2 762) (3 049) (2 280)
--------- --------- ---------
Total assets less current liabilities 16 096 16 564 16 905
Non-current liabilities
-------------------------
Borrowings due after one year 3 404 4 432 4 662
Pension liability for funded schemes in deficit 1 390 1 658 1 600
Pension liability for unfunded schemes 2 705 2 884 2 760
Restructuring and other provisions 534 502 482
Deferred tax liabilities 631 641 551
Other non-current liabilities 418 413 540
--------- --------- ---------
Total non-current liabilities 9 082 10 530 10 595
Liabilities held for sale 160 18 9
Equity
--------
Shareholders' equity 6 576 5 739 6 021
Minority interests 278 277 280
--------- --------- ---------
Total equity 6 854 6 016 6 301
--------- --------- ---------
Total capital employed 16 096 16 564 16 905
CASH FLOW STATEMENT
(unaudited)
£ million Nine Months
---------------
2006 2005
Operating activities
----------------------
Cash flow from operating activities 2 621 2 745
Income tax paid (491) (825)
--------- ---------
Net cash flow from operating activities 2 130 1 920
Investing activities
----------------------
Interest received 54 107
Net capital expenditure (452) (349)
Acquisitions and disposals 124 507
Other investing activities 38 243
--------- ---------
Net cash flow from/(used in) investing activities (236) 508
Financing activities
----------------------
Dividends paid on ordinary share capital (915) (842)
Interest and preference dividends paid (273) (323)
Change in borrowings and finance leases (825) (228)
Purchase of treasury stock (3) (548)
Other financing activities (122) (113)
--------- ---------
Net cash flow from/(used in) financing activities (2 138) (2 054)
--------- ---------
Net increase/(decrease) in cash and cash equivalents (244) 374
Cash and cash equivalents at the beginning of the year 868 994
Effect of foreign exchange rate changes 206 (131)
--------- ---------
Cash and cash equivalents at the end of period 830 1 237
ANALYSIS OF NET DEBT
(unaudited)
£ million As at As at
30 31
September December
2006 2005
--------- ---------
Total borrowings (7 290) (8 511)
--------- ---------
Borrowings due within one year (3 886) (4 079)
Borrowings due after one year (3 404) (4 432)
--------- ---------
Cash and cash equivalents as per balance sheet 976 1 050
--------- ---------
Cash and cash equivalents as per cash flow statement 830 868
Add bank overdrafts deducted therein 146 183
Less cash and cash equivalents in assets/liabilities held for - (1)
sale --------- ---------
Other financial assets 217 230
Derivatives and finance leases included in other receivables and (112) 23
other liabilities
--------- ---------
Net debt (6 209) (7 208)
GEOGRAPHICAL ANALYSIS
(unaudited)
Continuing operations - Third Quarter
£ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 2 599 2 330 1 859 6 788
2006 2 653 2 332 1 890 6 875
Change 2.0% 0.1% 1.7% 1.3%
Impact of:
Exchange rates (0.6)% (3.3)% (4.6)% (2.7)%
Acquisitions 0.0% 0.2% 0.0% 0.1%
Disposals (0.9)% (0.8)% (0.8)% (0.8)%
Underlying sales growth 3.5% 4.1% 7.5% 4.8%
---------------------- -------- -------- -------- --------
Price 0.3% 1.3% 2.3% 1.2%
Volume 3.1% 2.7% 5.0% 3.5%
---------------------- -------- -------- -------- --------
Operating profit
2005 446 359 254 1 059
2006 402 371 247 1 020
Change current rates (9.9)% 3.2% (2.8)% (3.8)%
Change constant rates (9.3)% 5.2% 1.9% (1.8)%
Operating margin
2005 17.2% 15.4% 13.7% 15.6%
2006 15.1% 15.9% 13.1% 14.8%
Includes restructuring, business
disposals and impairments
2005 (0.9)% (0.6)% (0.7)% (0.7)%
2006 (1.1)% (0.7)% (0.5)% (0.8)%
Continuing operations - Nine Months
£ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
Turnover
2005 7 753 6 614 5 248 19 615
2006 7 791 7 069 5 611 20 471
Change 0.5% 6.9% 6.9% 4.4%
Impact of:
Exchange rates 0.1% 3.8% 0.0% 1.4%
Acquisitions 0.0% 0.1% 0.0% 0.0%
Disposals (1.0)% (0.6)% (1.0)% (0.9)%
Underlying sales growth 1.4% 3.5% 8.0% 3.9%
---------------------- -------- -------- -------- --------
Price (0.1)% 1.4% 1.6% 0.9%
Volume 1.5% 2.1% 6.3% 3.0%
---------------------- -------- -------- -------- --------
Operating profit
2005 1 305 775 701 2 781
2006 1 172 1 096 706 2 974
Change current rates (10.2)% 41.4% 0.6% 6.9%
Change constant rates (10.2)% 35.8% 0.5% 5.5%
Operating margin
2005 16.8% 11.7% 13.4% 14.2%
2006 15.0% 15.5% 12.6% 14.5%
Includes restructuring, business
disposals and impairments
2005 0.0% (4.0)% 0.1% (1.3)%
2006 (0.6)% (0.2)% 0.1% (0.3)%
Operating profit of discontinued operations - Third Quarter
£ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 29 - - 29
2006 30 - - 30
Operating profit of discontinued operations - Nine Months
£ million Europe Americas Asia Total
Africa
-------- -------- -------- --------
2005 131 14 - 145
2006 125 - - 125
PRODUCT AREA ANALYSIS
(unaudited)
Continuing operations - Third Quarter
£ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 2 270 1 422 3 692 1 887 1 209 3 096 6 788
2006 2 256 1 474 3 730 1 950 1 195 3 145 6 875
Change (0.6)% 3.6% 1.0% 3.4% (1.2)% 1.6% 1.3%
Impact of:
Exchange rates (2.4)% (2.6)% (2.5)% (2.5)% (3.3)% (2.8)% (2.7)%
Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1%
Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%
Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8%
growth
Operating profit
2005 342 269 611 337 111 448 1 059
2006 310 267 577 335 108 443 1 020
Change current rates (9.4)% (0.8)% (5.6)% (0.6)% (3.4)% (1.3)% (3.8)%
Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%
rates
Operating margin
2005 15.1% 18.9% 16.6% 17.9% 9.2% 14.5% 15.6%
2006 13.7% 18.1% 15.5% 17.2% 9.0% 14.1% 14.8%
-------- --------
Continuing operations - Nine Months
£ million Savoury, Ice cream Foods Personal Home care Home and Total
dressings and care and Personal
and beverages other Care
spreads
-------- -------- -------- -------- -------- -------- --------
Turnover
2005 6 728 4 020 10 748 5 296 3 571 8 867 19 615
2006 6 884 4 216 11 100 5 704 3 667 9 371 20 471
Change 2.3% 4.9% 3.3% 7.7% 2.7% 5.7% 4.4%
Impact of:
Exchange rates 1.0% 1.1% 1.1% 1.8% 1.3% 1.6% 1.4%
Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0%
Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%
Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9%
growth
Operating profit
2005 1 088 403 1 491 922 368 1 290 2 781
2006 1 023 641 1 664 987 323 1 310 2 974
Change current rates (6.0)% 59.0% 11.6% 7.1% (12.3)% 1.6% 6.9%
Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5%
rates
Operating margin
2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2%
2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5%
-------- --------
EARNINGS PER SHARE FOR TOTAL OPERATIONS IN STERLING FOR THE NINE MONTHS
2006 2005
--------- ---------
Combined EPS Thousands of units
---------------
Average number of combined share units 2 882 122 2 920 224
£ million
---------------
Net profit attributable to shareholders' equity 1 857 2 110
--------- ---------
Combined EPS (Pounds) 0.64 0.72
--------- ---------
Combined EPS - Diluted Thousands of units
---------------
Adjusted average number of combined share units 2 968 519 3 015 309
£ million
---------------
Adjusted net profit attributable to shareholders' equity 1 857 2 112
--------- ---------
Combined EPS - diluted (Pounds) 0.63 0.70
--------- ---------
This information is provided by RNS
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