Cost-cutting programme helps lift Unilever

Anglo-Dutch consumer products giant Unilever reported a 13 per cent rise in 2002 net profit today and set an underlying earnings…

Anglo-Dutch consumer products giant Unilever reported a 13 per cent rise in 2002 net profit today and set an underlying earnings growth target of just over 10 per cent for this year.

Unilever, with top food brands such as Hellmann's and Knorr and personal care top-sellers Dove and Calvin Klein, reported net profit before exceptional items and amortisation of goodwill and intangibles for 2002 of €4 billion ($4.30 billion) compared with forecasts of €3.9 to €4.2 billion.

Unilever stuck broadly to its guidance given at the start of its "Path to Growth" programme started in early 2000 to target revenue growth of its top 400 brands of 5 to 6 per cent for 2003.

The group said underlying 2002 earnings per share grew 21 per cent at constant exchange rates and sales of its top 400 brands climbed 5.4 per cent. Unilever said its underlying 2002 operating margin rose to 14.9 per cent, compared to 13.9 per cent in 2001.

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Last month, Unilever said 2002 sales of its top brands rose 5.4 per cent, above its previous target of 4.5 to 5 per cent with a strong fourth quarter rise after the first three quarters saw growth of 3, 4.4 and 5.4 per cent.

Unilever, the world's number three food group, is in the middle of a five-year drive during which it aims to narrow its focus on its 400 leading brands, which now account for nearly 90 per cent of sales.

This growth plan mapped out in 2000 and revised after Unilever's $24.3 billion purchase of US food company Bestfoods aims to increase underlying annual sales growth to 5 to 6 per cent and profit margins to more than 16 per cent by 2004.

AP