Unilever PLC · LSE:ULVR
Unilever — FY2002 Earnings Presentation
17 slides from Unilever's earnings presentation, 2003
Slide 1: Path to Growth Scorecard
Unilever Roadshow - 2002 Results Achieving our Path to Growth targets p^cb=e^o_lro=pq^qbjbkqW= = qÜáë= éêÉëÉåí~íáçå= ã~ó= Åçåí~áå= Ñçêï~êÇJäççâáåÖ= ëí~íÉãÉåíë= EïáíÜáå= íÜÉ= ãÉ~åáåÖ= çÑ= íÜÉ= rKpK= mêáî~íÉ= pÉÅìêáíáÉë iáíáÖ~íáçå=oÉÑçêã=^Åí=NVVRFK==^åó=Ñçêï~êÇJäççâáåÖ=ëí~íÉãÉåíë=~êÉ=Ä~ëÉÇ=çå=ÅìêêÉåí=
Slide 2: Path to Growth: progress on all levers of value creation
Path to Growth: progress on all levers of value creation Sustaining Outperformance Top Line Growth Leading Brands from 75% to 89% Operating Capital Cost of HPC Foods Margin Efficiency Capital Growth Growth from from +380 bps +700 bps competitive 5.3% to 1.9% to 6.7% 4.4% EPS (beia) - Low Double Digi
Slide 3: Progress of Leading Brands / Scaling the growth ladder
Progress of Leading Brands UIM råÇÉêäóáåÖ p~äÉë=dêçïíÜ=B 2002 Growth TIM SIM Foods 4.5 ex IC HPC 6.7 RIM Ice 4.0 Cream QIM Total 5.4 PIM OIM Global brands now 64% of sales NIM 14 brands with sales €1 bln+ MIM nQ=DMM nN=DMN nO=DMN nP=DMN nQ=DMN nN=DMO nO=DMO nP=DMO nQ=DMO G=cêçã==nO=OMMN=áåÅäìÇÉë=ãÉê
Slide 4: Scaling our Growth Ladder; Margin and Capital Efficiency Progression
Scaling our Growth Ladder % of Growth % Impact on Strategy Portfolio 2002 growth rate Personal Care Health & Wellness Sustain Spreads & Cooking 59 % 7.5% - D&E and NA Ice Cream Savoury & Dressings Move to historical Homecare 21 % 1.9% +60bps growth rates Tea European Ice Cream 0.8% Bring innovation
Slide 5: Operating Margin: restructuring and integration
Operating Margin: To 2004 2004 16%+ Step up A&P spend - 80 bps +70-90 bps Recovery of D&E Cost Improved Mix +60-70 bps Restructuring €700 mln to go +130 bps 14.9% 2002 0% 5% 10% 15% 20% Operating Margin % And…continued momentum in global procurement and Bestfoods integration savings Executing the Re
Slide 6: Capital Efficiency and Cash Flow
Capital Efficiency % Sales 1999 2002 Fixed Assets 21.4 17.1 Working Capital 7.6 4.9 Total Operating Assets 29.0 22.0 •Factory restructuring •Global procurement Ongoing •Continuous Replenishment •Outsourcing up from 15% to 25%+ Cash Flow o C 5 4.5 €4.3bn 4 Net Debt 3.5 3 €2.8bn 2000 €26bn 2.5 2 2002
Slide 7: Key features of Q4 results; Outlook for 2003
Key features of Q4 results • Underlying sales growth 7.2%, half from price • Leading brand growth 8.5%, 3.9% price HPC 9.8% Foods 7.3% • December sales growth 9% • Operating margin 13.5%, after 300 bps increase in A&P • EPS (beia) growth +4.6% Outlook for 2003 • Leading brands growth 5-6% • Leading
Slide 8: Impact of implementing FRS17; Accounting for stock options
Impact of implementing FRS17 Pension & Other Benefits elements 2002 2003 (Estimate) Impact on: (€ mln) SSAP 24 FRS 17 FRS 17 Operating Profit (beia) (274) (381) (400) Charge to Interest 0 108 (190) Profit before Tax (274) (273) (590) Net Profit (beia) (184) (183) (395) Net Assets (after tax) €bln (2
Slide 9: Backup Charts: The Key Drivers of Growth
Backup Charts The Key Drivers of Growth • Powerful “reshaped” portfolio of brands in fragmented markets – Build strength in the core - • Innovate in fastest growing segments with brands on trend with the consumer • “Space for growth” - Move from Category to Brand mindset – Extending brands across ca
Slide 10: Hitting Consumer Hotspots; Leveraging our Strength in D&E
Hitting Consumer Hotspots Growth % 2002 Meal MealSolutions Solutions Snacking Refreshment Refreshment +13 % + 11% SocialCelebration Social Celebration + 15 % +9% + 6% + 12 % Health&& Health Indulgence Indulgence Wellness Wellness + 9% + 12 % + 11 % + 9% Leveraging our Strength in D&E • 2006: D&E pur
Slide 11: Underlying Price & Volume; Taking Charge of the Top-Line
Underlying Price & Volume 2001 Devaluing Countries 20 15 10 5 0 nN=MN nO=MN nP=MN nQ=MN nN=MO nO=MO nP=MO -5 -10 Price Change % Underlying Volume % USG % _ê~òáäI=`ÜáäÉI=fåÇçåÉëá~I=qÜ~áä~åÇI=hÉåó~I=pçìíÜ=^ÑêáÅ~I=qìêâÉó Taking Charge of the Top-Line: Global Brands • Portfolio of Global Brands & Local
Slide 12: Personal Care; Laundry
Foundations for sustained, profitable growth: Personal Care USG FY 2002 Comment Personal Care 9% 7% p.a. last 4 years Hair, Skin, Deo 11% 9% p.a. last 4 years Growing the core - creating the platform for space for growth double-digit growth driven by existing markets double-digit growth driven by pe
Slide 13: Savoury and Dressings; Knorr - a brand for all seasons
Foundations for sustained, profitable growth: Savoury and Dressings % of Sales H2 USG Savoury & Dressings 7%+ Leading Brands 90% 8%+ Knorr, Hellmann’s, Bertolli 50% Momentum underpinned by: Europe:+7% Latam:+15% H2 USG: 7.5% Knorr - a brand for all seasons Reach out Reach up New consumers Nutrition
Slide 14: Spreads & Cooking Products; Frozen foods
Foundations for sustained, profitable growth: Spreads & Cooking Products 9 successive quarters of 4%+ leading brands growth USG % of sales FY 2002 Leading Brands 70% >4% Foundations for sustained, profitable growth: Frozen foods Earned the right to grow…now need to grow…and sustain it • Now purely a
Slide 15: Ice cream; Tea based beverages
Foundations for sustained, profitable growth: Ice cream Global leader….growing organically….profitably USG Comment 2001 3% 2002 4% N. America 8% Sustain superior performance D&E markets 6% Returning to historical growth Europe 1% Need to broaden consumer reach Foundations for sustained, profitable g
Slide 16: Commodity Prices; Sustained Performance
Commodity Prices Breakdown of raw materials & packaging % turnover Raw Materials & Packaging % Turnover Oils and Fats Packaging 9% 4% turnover Raw Materials 24% Tea 1.3% turnover Sustained Performance 1985 - 1999 Fuelled by embedding Value Creation in our Business • Cash flow from Operations cumulat
Slide 17: In February 2000, Unilever announced its 'Path to Growth' strategy
In February 2000, Unilever announced its ‘Path to Growth’ strategy ^ÅÅÉäÉê~íÉ=ê~íÉ=çÑ=íçé=äáåÉ=ÖêçïíÜ=íç=R=J=SB=é~=Äó=OMMQ= fåÅêÉ~ëÉ=çéÉê~íáåÖ=ã~êÖáå=íç=áå=ÉñÅÉëë=çÑ=NSBG=Äó=OMMQ bmp=ÄÉá~=äçï=ÇçìÄäÉ=ÇáÖáí=ÖêçïíÜ=OMMN=J=MQ oÉëíêìÅíìêáåÖ=p~îáåÖë=€OKPÄå=Äó=OMMQ éäìë==NKSÄå=éêçÅìêÉãÉåí=ë~îáåÖë ^Åèìáëáíá