Unilever 2001 Annual Report Download - page 26

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Unilever Annual Report & Accounts and Form 20-F 2001
OPERATING REVIEW BY CATEGORY – FOODS >23
Report of the Directors
Culinary
We are world leaders in the two categories that make up
our culinary business: savoury and dressings.
Knorr is now our biggest brand and, during its first full year
under Unilever stewardship, grew by over 4% worldwide.
We drove its strong performance with innovations such as
Knorr Exotic Meal Kits, which we continued to extend in
Europe; Knorr Cup Pasta, which we launched in Taiwan;
Knorr Quick Soups in Switzerland and Knorr Sazonisimo,
which we introduced in Mexico.
The Hellmann’s brand also did well considering difficult
market conditions in Latin America and fierce competition
in the US. It enjoyed sales growth of over 10% in some
national markets, including Greece, Ireland, the Philippines
and Thailand. As part of the integration, we withdrew
Hellmann’s pourable sauces in the US to concentrate
on the larger Wishbone brand.
Our Amora brand also had a successful year with increased
turnover and profits. Innovations, such as Amora Clip-Sauce
in France and extensions into the chilled cabinet, helped
drive growth.
We disposed of several European dry soups and sauces
businesses, following undertakings given to the European
Commission in connection with the Bestfoods’ acquisition.
These disposals included Batchelors and Oxo in the UK,
Royco and the Lesieur range in France, Heisse Tasse in
Germany and Blå Band in Denmark, Sweden and Finland.
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 foodservice 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.
2000 results compared with 1999
million million million %
2000 at
2000 at constant 1999 Change at
current 1999 at 1999 constant
rates rates rates rates
Total turnover 8 454 7 911 6 428 23%
Total operating profit BEIA 1 078 1 002 663 51%
Exceptional items (322) (314) (120)
Amortisation of goodwill
and intangibles (334) (299) (1)
Total operating profit 422 389 542 (28)%
Total operating margin 5.0% 4.9% 8.4%
Total operating margin BEIA 12.8% 12.7% 10.3%
Culinary
Culinary volumes rose significantly – reflecting our
acquisition of Bestfoods and Amora Maille. Excluding
acquisitions, sales rose by 4%. There were improvements
in all regions except Latin America, where sales of tomato-
based products fell. Growth was particularly strong in Asia
and Pacific where sales rose by 10%. In both Western
Europe and North America, sales grew by 4%.
We continued to apply innovations to our product
formulations, for example, capitalising on Sizzle & Stir’s
great success in the UK with a spicy variant Stir it Up.
In Australia, we successfully launched Continental ethnic
noodle sauces.
In Europe, our market leading position in mayonnaise and
mustard was extended by the acquisition of Amora Maille,
the major player in these categories in France. In North
America, Just 2 Good salad dressings were launched with
great success and sales of Lawry’s marinades continued
growing well. In cooking ingredients, innovations included
a range of Kissan spice blends in India.
Frozen foods
Our frozen foods portfolio is now focused on a few strong
brands. In line with our strategy, we made good progress
in cutting less profitable lines. This portfolio realignment,
combined with low-cost manufacturing and new
technologies, contributed to increased margins. The
category is expected to show good, sustainable growth
from the end of 2001.
Our brand leadership was further improved by the very
successful roll-out of meal solutions in key European
countries – such as the 4 Salti in Padella range of frozen
recipe dishes – and the promising launch of the high-quality
Hot & Steamy microwave-heated snack range.