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38 Unilever Annual Report & Accounts and Form 20-F 2003
Operating review by category – Foods
Ice cream and frozen foods
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 7 517 (523) 6 994 7 456 (6)% 1%
Group operating profit 1 076 (52) 1 024 569 80% 89%
Turnover 7 517 (523) 6 994 7 456 (6)% 1%
Operating profit BEIA 1 070 (58) 1 012 833 22% 28%
Exceptional items 29 3 32 (237)
Amortisation – goodwill and intangible assets (23) 3 (20) (27)
Operating profit 1 076 (52) 1 024 569 80% 89%
Operating margin 14.3% 14.6% 7.6%
Operating margin BEIA 14.2% 14.5% 11.2%
Turnover and underlying sales growth 2003
(at constant 2002 rates) vs 2002
Underlying sales growth (%) 2.4
Effect of acquisitions (%) 0.2
Effect of disposals (%) (1.8)
Turnover growth (%) 0.8
Turnover
€ million
2003 6 994
At current exchange rates At current exchange rates
2002 7 456
2001
2003
2002
2001
7 727
1 012
833
736
Operating profit BEIA
€ million
At current exchange rates
2003
2002
2001
1 024
569
386
Operating profit
€ million
Turnover fell by 6% at current rates of exchange, with currency
movements contributing a 7% decline. Operating profit grew
by 80% and operating profit BEIA grew by 22%, with currency
movements contributing a 9% and 6% decline respectively. The
underlying performance of the business after eliminating these
exchange translation effects is discussed below at constant
exchange rates.
Ice cream
Ice cream had a strong year with 4.3% underlying sales growth,
assisted by good weather in Europe. In quarter one, the relaunch
of the Heart brand strengthened its resonance with contemporary
consumers, and innovations such as Magnum 7 Sins, Magnum
Bar & Sandwich and Carte d’Or artisanal delivered strong growth.
Originally launched in Australia, Magnum 7 Sins was successfully
rolled out across Europe. Roll-out of Cornetto into the growing
soft-serve out-of-home sector continued.
It was another excellent year for North America with strong
performances from Breyers, Klondike and Popsicle, and new
low-carbohydrate ice creams. Latin America continues to make
good progress, driven by Mexico and Brazil.
Frozen foods
Frozen foods experienced a difficult year, resulting in a decline
in 2003 with share growth in meals being offset by a decline
in vegetables and fish. Recessionary trends and increased
competition from private labels and discounters impacted sales
in Germany and in the Netherlands. The main shortfalls were in
Iglo and Mora while Birds Eye showed progress. Knorr frozen
continued to deliver good growth and further roll-out is planned.