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26 Unilever Annual Report and Accounts 2004
Operating review by category – Foods
Savoury and dressings
2004 results compared with 2003 € million € million € million € million % %
Exchange Change at Change at
2004 at rate 2004 at 2003 at actual constant
2003 rates effects 2004 rates 2003 rates current rates 2003 rates
Group turnover 8 682 (316) 8 366 8 551 (2)% 2%
Group operating profit 415 (19) 396 475 (17)% (12)%
Turnover 8 713 (316) 8 397 8 609 (2)% 1%
Operating profit BEIA 1 617 (56) 1 561 1 496 4% 8%
Exceptional items (292) 1 (291) (110)
Amortisation – goodwill and intangible assets (908) 36 (872) (908)
Operating profit 417 (19) 398 478 (17)% (13)%
Operating margin 4.8% 4.7% 5.6%
Operating margin BEIA 18.6% 18.6% 17.4%
Turnover and underlying sales growth 2004
(at constant 2003 rates) vs 2003
Underlying sales growth (%) 2.6
Effect of acquisitions (%) 0.3
Effect of disposals (%) (1.7)
Turnover growth (%) 1.2
Turnover
€ million
2004 8 397
At current exchange rates At current exchange rates
2003
2002
2004
2003
2002
1 561
Operating profit BEIA
€ million
At current exchange rates
2004
2003
2002
398
8 609
9 503
1 496
1 483
478
427
Operating profit
€ million
Turnover fell by 2% at current rates of exchange, with currency
movements contributing a 3% decline. Operating profit fell
by 17% and operating profit BEIA grew by 4%, with currency
movements contributing a 4% decline in both cases. The
underlying performance of the business after eliminating these
exchange translation effects is discussed below at constant
exchange rates.
We are developing our savoury and dressings brands through
products that suit the changing lifestyles of our consumers. We
are keeping them relevant through the creation of world-class
communication and launches into new trade channels and
markets. Underlying sales grew by 2.6%. Operating margin BEIA
improved from 17.4% to 18.6% with our restructuring and
procurement programmes more than offsetting commodity cost
pressures.
Our performance in Europe was mixed. There was strong growth
in dressings in Russia and the UK. However this was partly offset
by declines for dressings in France and the Netherlands and in
savoury in the UK as we faced a challenging trade environment
and intense competition.
In North America, Hellmann’s dressings benefited from strong
brand activation and an improved ‘go-to-market’ strategy.
Excellent results were achieved with our Carb Options dressings,
part of a wider range of low-carbohydrate products. This was
followed by the launch of chilled side dishes under our Country
Crock brand across the US towards the end of the year.
In Latin America, a cholesterol-free Hellmann’s mayonnaise met
the growing demand for healthy heart products. New Knorr soup
ranges were launched in Mexico and Argentina, while in Brazil we
launched low unit price Knorr seasoning cubes, particularly
relevant to lower-income consumers.
Our olive oil business performed well, with strong results from
Bertolli in Germany, the US, Canada and Italy.