Unilever 2004 Annual Report Download - page 34

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Unilever Annual Report and Accounts 2004 31
Operating review by category – Foods
Beverages (continued)
2003 results compared with 2002 € million € million € million € million % %
Exchange Change at Change at
2003 at rate 2003 at 2002 at actual constant
2002 rates effects 2003 rates 2002 rates current rates 2002 rates
Group turnover 3 910 (461) 3 449 4 064 (15)% (4)%
Group operating profit 413 (46) 367 347 6% 19%
Turnover 4 052 (483) 3 569 4 215 (15)% (4)%
Operating profit BEIA 603 (76) 527 602 (12)% –%
Exceptional items (11) – (11) (99)
Amortisation – goodwill and intangible assets (137) 24 (113) (120)
Operating profit 455 (52) 403 383 5% 19%
Operating margin 11.2% 11.3% 9.0%
Operating margin BEIA 14.9% 14.8% 14.3%
Turnover and underlying sales growth 2003
(at constant 2002 rates) vs 2002
Underlying sales growth (%) (1.7)
Effect of acquisitions (%) 0.4
Effect of disposals (%) (2.5)
Turnover growth (%) (3.9)
Turnover fell by 15% at current rates of exchange, with currency
movements contributing an 11% decline. Operating profit grew
by 5% and operating profit BEIA fell by 12%, with currency
movements contributing a 14% and 12% decline respectively.
The underlying performance of the business after eliminating
these exchange translation effects is discussed below at constant
exchange rates.
In 2003, we encountered many challenges with the Slim•Fast
brand while other parts of the health and wellness category
performed well.
Turnover of Slim•Fast declined by 21% as the entire weight-loss
category was hit by a shift in consumer preferences towards low-
carbohydrate products. The impact was especially pronounced in
the US, the largest market for Slim•Fast. Slim•Fast responded by
focusing on the Slim•Fast Plan as a proven and effective weight-
loss programme with an expanded range of products, including
pasta and soups. Low-carbohydrate and high-protein products
were also launched at the end of 2003.
AdeS, our healthy, nutritious drink had another very strong year
in Latin America.
Lipton had an excellent year with underlying sales growth of 8%.
Lipton continued to build on its natural vitality positioning
providing healthy, refreshing beverages, including a wide range
of leaf tea offerings and ready-to-drink Lipton Ice Tea.
Growth was particularly strong in Europe, where hot summer
weather provided ideal market conditions for Lipton Ice Tea.
Lipton Brewed Ice Tea was a very successful new innovation
launched by UBF Foodsolutions in the US as we continued to
build Lipton in the out-of-home segment. An improved marketing
mix for Lipton Green – in both a cold and hot format – was
successfully launched in Europe and extended Lipton into an
important segment. We also expanded our successful North
American partnership with Pepsi to include many more countries.
We continued to have strong positions in key traditional tea
markets. In 2003, we had a very successful relaunch of the
Brooke Bond brand in India.