Report & accounts 2002 in full - Unilever

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We are determined to remain the world’s number one ice cream company. We have transformed the cost structure of the business and focused on profitable countries and are now able to concentrate on innovation and growth. For example, we took brands like Cornetto out of the static freezer box and into the growing soft-serve out-of-home sector, while continuing to target the in-home sector with innovations such as mini multi-packs and Cornetto snacksize ice cream, both of which made good progress. We continued to widen the appeal of our ice creams to consumers who want fun, novelty and freshness. For example, we targeted consumers’ desire for indulgence (Magnum), refreshment (Solero) and kids fun (Paddle Pop). We made good progress in Latin America and North America and, in the context of a poor summer, performed well in Europe. In October 2002, the European Court of First Instance heard our appeal against the European Commission’s negative decision in the matter of cabinet exclusivity in Ireland. That decision remains suspended, while we await the ruling of the Court. Frozen foods Convenience combined with fresh-tasting, high quality ingredients drove the success of our Iglo, Bird’s Eye and Findus frozen ready meal solutions, which grew by 11%. Our overall frozen foods turnover fell by 8%, primarily due to disposals. A strong fourth quarter driven by quality innovations and brand support resulted in an underlying sales growth of 1% for the year. Sales growth in ready meals was offset by the implications of the end of the BSE crisis, which last year drove stronger demand for fish, especially in the UK. Our frozen foods capability is a valuable asset across the portfolio, which we are now starting to test with other brands. Unilever Annual Report & Accounts and Form 20-F 2002 Operating review by category – Foods 29 2001 results compared with 2000 at current exchange rates € million € million % 2001 2000 Change Turnover 7 727 7 869 (2)% Operating profit 446 227 97% Group turnover 7 727 7 848 (2)% Group operating profit 446 225 98% 2001 results compared with 2000 at constant 2000 exchange rates € million € million % 2001 2000 Change Turnover 7 748 7 866 (2)% Operating profit BEIA 800 637 26% Exceptional items (331) (394) Amortisation of goodwill and intangibles (29) (17) Operating profit 440 226 95% Operating margin 5.7% 2.9% Operating margin BEIA 10.3% 8.1% Ice cream Our major ice cream brands performed well during 2001 and underlying sales grew by almost 3%. Progress was driven by innovations, such as Magnum snack-sizes, Cornetto miniature and multi-packs and Cornetto-branded soft ice cream. A positive overall picture was affected by declining wrapped impulse sales in Germany and the UK. In North America our Canadian and US businesses delivered excellent underlying sales growth and much improved profits. The strength of our portfolio was demonstrated by the success of Ben & Jerry’s in the US super-premium market during its first full year as a Unilever business. In line with our commitment to a world-class supply chain, we closed eight factories that were of limited long-term value and introduced more efficient ways of buying raw materials and packaging. We also eliminated certain poorly performing products and withdrew from nine countries where our ice cream business was unprofitable, including Colombia, Russia and Saudi Arabia. Report of the Directors
30 Operating review by category – Foods Frozen foods Our ongoing businesses in frozen foods achieved good profitable growth due to innovation and tight business focus. The key growth drivers were products that met the demand for healthy and convenient foods. We successfully rolled out frozen high-quality meal ranges based on the Italian concept 4 Salti in Padella, including Birds Eye enjoy! in the UK. Our frozen snacks also performed well. In 2001, we began successfully extending frozen food brands and products into our Foodsolutions business. We disposed of our Gorton’s frozen seafood business in North America and the Frudesa business in Spain, but retained limited rights to use the Frudesa brand name. We also withdrew from frozen foods in Argentina. Unilever Annual Report & Accounts and Form 20-F 2002
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Report & accounts 2002 in full - Unilever

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