Unilever 2000 Annual Report Download - page 31

Download and view the complete annual report

Please find page 31 of the 2000 Unilever annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

All of the above risks could materially affect the Group’s
business, its turnover, operating profit, net profit, net assets
and liquidity.
Total shareholder return
Total Shareholder Return (TSR) is a concept used to compare
the performance of different companies’ stocks and shares
over time. It combines share price appreciation and
dividends paid to show the total return to the shareholder.
The absolute size of the TSR w ill vary w ith stock markets,
but the relative position is a reflection of the market
perception of overall performance.
The company calculates TSR over a three-year rolling period.
This period is sensitive enough to reflect changes but long
enough to smooth out short-term volatility. The return is
expressed in US dollars, based on the equivalent US dollar
share price for NV and PLC. US dollars w ere chosen to
facilitate comparison with companies in Unilever’s chosen
reference group.
Unilever's TSR target is to be in the top third of a reference
group of 21 international consumer goods companies.
During 2000, there were tw o changes to the reference
group as a result of acquisitions in the industry.
At the end of 1999 we were positioned 7th and during
2000 we fell to 13th, outside our target position w hich
remains the top third of our reference group.
Significant changes
Any important developments and post-balance sheet events
that have occurred since 31 December 2000 have been
noted in this Annual Report & Accounts and Form 20-F
2000. Otherw ise, there have been no significant changes
since the year end.
29
Unilever Annual Report & Accounts and Form 20-F 2000 Report of the Directors
Financial review
accounts, foodservice distributors and institutions. Products
are distributed through distribution centres, satellite
warehouses, company-operated and public storage facilities,
depots and other facilities.
Unilever has undertaken several initiatives to work with
its customers to accelerate the development of product
categories, to optimise the flow of merchandise and the
inventory levels of its customers. These include efficient
consumer response (ECR) to achieve optimal stock
management, automatic stock replenishments and just-in-
time delivery using electronic data interchange (EDI) to
co-ordinate stock levels in stores and at Unilever’s
warehouses. ECR is also a process used by Unilever and
retailers to understand, and deliver against, consumer
demand and expectations.
Impact of price changes
Information concerning the impact of price changes
is restricted to tangible fixed assets and depreciation.
See note 10 on page 58.
Risk factors
Particular risks and uncertainties that could cause actual results
to vary from those described in forw ard-looking statements
within this Annual Report & Accounts and Form 20-F 2000
include those described on page 28 and the following:
• Unilever operates in more than 90 countries, and in each
country, the business is subject to varying degrees of risk
and uncertainty related to local regulation, political and
social climate and other factors.
• Unilever’s ability to continue to achieve lower costs and
increases in reliability and capacity utilisation.
• Unilever may not be able to improve revenue and
profitability in light of high levels of competitive activity
and the economic volatility in emerging markets.
• Unilever’s ability to maintain key customer relationships.
• Unilever’s continuation of substantial grow th in significant
developing markets such as China and the rest of
Southeast Asia, M exico, Brazil and the rest of Latin
America and the countries of Central and Eastern Europe.
• Unilever’s ability to successfully manage regulatory, tax
and legal matters.
• Unilever’s ability to continue to innovate.
• Unilever’s ability to achieve the Path to Grow th
programme, w hich consists of focusing resources on
leading brands, closing manufacturing sites and re-
organising or divesting under-performing businesses.
• Unilever’s ability to integrate acquired businesses
including Amora M aille, Ben & Jerry’s, Bestfoods and
Slim•Fast (all of which were acquired during 2000) and
to realise expected strategic benefits.
• Unilever’s ability to effectively implement throughout
the Group the organisational changes announced
during 2000.
Unilever’s position relative to the reference group
7
14
21
96 97 98 99 00
The reference group, including Unilever, consists of 21 companies.
Unilever's position is based on TSR over a three-year rolling period.