Unilever Annual Report & Accounts and Form 20-F 2000

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Unilever Annual Report & Accounts and Form 20-F 2000 Chairmen’s statement 4 showed good progress in leading brands but overall sales were held back by a poor ice cream season and a decline in the ‘tail’ brands. Africa and Middle East sales grew by 3%, with operating profits up by 9%. Sustainable development We have made good progress in our commitment to sustainable development. Our focus is on sustainable agriculture, water stewardship and renewable marine stocks. Early in 2001 we published our first Social Review. This sets out Unilever’s approach to corporate social responsibility. This is a companion document to our online Environment Report which demonstrates continuing progress in reducing our global environmental impact. The Unilever team 2000 was a year of enormous effort by our people throughout the organisation. Without their commitment, the substantial progress described here would not have been achieved. Our thanks are due to all of them. Throughout its history, Unilever has successfully adapted to change. However, today the intensity and pace of change are unprecedented. In the last year we have done much to improve the quality of the leadership team. This has involved significant changes to the composition of the top team and how it works together. We have radically adjusted the remuneration of our managers which is now sharply directed towards variable reward for delivery of growth and shareholder value. We are committed to building a team with a passion for growth and winning. The way ahead In 2001, we will continue to meet the milestones outlined in our Path to Growth strategy. We expect to see increased momentum in the growth of our leading brands and to continue to expand profit margins. Our divestment programme will both reduce borrowings and further simplify our business. We confidently reaffirm our strong commitment to the objective of sustainable low double digit earnings growth. Antony Burgmans and Niall FitzGerald Chairmen of Unilever Report of the Directors
Unilever Annual Report & Accounts and Form 20-F 2000 Report of the Directors About Unilever Description of business Unilever is one of the world’s leading suppliers of fast moving consumer goods in foods, household care and personal product categories. Business structure During the year ended 31 December 2000, Unilever was organised, and its internal results were reported, on both a product and a regional basis. On a product basis, Category Directors were responsible for developing category strategies for implementation across Unilever’s operations and they worked closely with Business Groups to develop regional strategies. They were also responsible for directing and managing the allocation of corporate resources for research and development and the innovation network. On a regional basis, Unilever’s operations were organised into 12 Business Groups. These were regionally based with the exception of DiverseyLever, a worldwide grouping of professional cleaning products and services. Western Europe and North America were further sub-divided by Foods and Home & Personal Care product categories. The individual operating companies, which formed the core building blocks of the Unilever organisation, came within the Business Groups. The President of each Business Group was accountable for the performance of the companies in his group. In August 2000, Unilever announced an evolution of its top management structure, creating two global divisions – one for Foods and one for Home & Personal Care (HPC), with effect from 1 January 2001. These global divisions’ operations are organised into Business Groups on a regional basis, with the exception of DiverseyLever and Prestige within HPC and the global businesses of Ice Cream and Frozen Foods and Foodservice within the Foods Division. Foods Oil and Dairy Based Foods We are the global category leader in margarine and related spreads in most countries in Europe and North America. We sell spreads, oils and cooking fats in more than 100 countries. In Western Europe and North America, consumer interest remains strong in spreads offering qualities related to ‘health’ and ‘taste’, although overall consumption in the sector is declining. Important brands in these markets are Becel (the Netherlands), Flora (UK), Fruit d’Or (France), Rama (Germany) and Country Crock and Take Control (US). We are category leader in branded olive oil in many countries in Western Europe and North America. Our most important international brand is Bertolli. We sold our European Bakery Supplies Business in the second half of the year and on 19 February 2001 we announced an agreement to sell the Bestfoods baking business for a debt free price of €1.9 billion. The sale is subject to customary conditions, including regulatory approval. Ice cream and beverages We are the world’s leading producer of ice cream, with sales in more than 90 countries worldwide. Important household names are Wall’s, Langnese, Ola and Algida in Europe and Ben & Jerry’s, (acquired in 2000), Good Humor and Breyers in the United States. Ice cream products such as Magnum, Solero, Cornetto, Carte d’Or and Viennetta are brands sold internationally as part of local or international household brands. We have important positions in packet tea and tea-related drinks in many regions through our Lipton and Brooke Bond brands. Lipton is the world’s leading brand in tea and iced tea. Sales of ready-to-drink teas are growing throughout Europe, North America and East Asia. We have a joint venture with PepsiCo Inc., which markets ready-to-drink products in North America and Mexico. Culinary and frozen foods We are the leading producer of frozen foods in Europe, under the Birds Eye brand in the United Kingdom and Iglo brand in most other European countries. We also market frozen seafood in the United States under the Gorton’s brand. We have a significant pasta sauce business under the Ragú brand. We also sell bouillons and other cooking aids in Europe, North America, Australasia, Egypt and sub-Saharan Africa. In the United Kingdom, Colman’s is a significant brand in meal sauces and condiments and the acquisition of Amora Maille in France added important brands covering condiments, mayonnaise and vinegar-based products with sales in a number of European countries. Salad dressings, spices and seasonings are marketed in the United States under the Wishbone and Lawry’s brands. The acquisition of Bestfoods in October 2000 has significantly strengthened our position in the culinary category by adding major international brands such as Knorr and Hellmann’s and a strong global foodservice business. In addition, the acquisition of Slim•Fast Foods in May 2000 has enhanced our functional food products range, primarily in the United States. On 29 January 2001 we announced an agreement to sell our dry soup and sauces business in Europe for a debt free price of €1 billion. These include the Blå Band brand in Denmark, Finland and Sweden, the Batchelors brand in the United Kingdom, the McDonnels brand in Ireland, the Oxo brand in Belgium, Ireland and the United Kingdom, the Royco brand in Belgium, France and Portugal and 5
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Unilever Annual Report & Accounts and Form 20-F 2000

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