FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the month of July, 2008
UNILEVER N.V.
(Translation of registrant's name into English)
WEENA 455, 3013 AL, P.O. BOX 760, 3000 DK, ROTTERDAM, THE NETHERLANDS
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F..X.. Form 40-F.....
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(1):_____
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(7):_____
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ..... No ..X..
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82- ________
Exhibit 99 attached hereto is incorporated herein by reference.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
UNILEVER N.V.
|
|
/S/ P J CESCAU
By P J CESCAU
DIRECTOR
|
|
/S/ J A LAWRENCE
By J A LAWRENCE
DIRECTOR
|
Date: 31 July 2008
EXHIBIT INDEX
-------------
EXHIBIT
NUMBER
EXHIBIT DESCRIPTION
99
Notice to Euronext, Amsterdam dated 31 July 2008
2nd Quarter Results 2008
Exhibit 99
INTERIM MANAGEMENT REPORT FOR HALF YEAR TO JUNE
2008
GOOD PERFORMANCE CONTINUES IN A CHALLENGING ENVIRONMENT.
OUTLOOK CONFIRMED.
Financial
Highlights
of the Half Year
-
Underlying sales growth of 7.0% in the first half year.
-
Operating margin of 16.0% in the first half year, with
an underlying improvement of 0.4 percentage poi
nts.
-
Earnings per share up by 6%, or 12% at constant
exchange rates. The first quarter benefited from disposal profits, while
the second quarter was affected by higher restructuring charges and a
particularly low tax rate last year.
-
Broad-based growth
in every
category.
-
Continued strong growth in Developing and
Emerging
(D&E)
countries from both volume and pricing.
-
Price-driven g
rowth i
n Western Europe and
North America
.
-
Cost increases recovered through determined pricing
action and accelerating savings. Efficiency programmes on track to deliver
€1 billion of savings this year.
-
Further
significant
progress with disposal programme,
including
Bertolli
olive oil and North American laundry.
"
Our performance in the first half year has been good in what
has been a challenging environment. We have delivered 7% underlying sales growth
and an underlying improvement in profitability while maintaining competitiveness.
The changes already implemented in the business have made us nimbler and better
able to respond to the market conditions. We are doing so against
our
clear priorities
of maintaining competitiveness, improving margins and investing
selectively to gain market
share
.
Looking to the future,
our strategy leverages
our
strong brands,
broad geographic footprint and products that meet
everyday needs across a wide range of price points.
Our innovation programme focuses on opportunities in health and
wellness, the use of superior technology, and rapid deployment
in
to new markets.
This continues to be the best route to long-term value
creation
.
For this year we confirm our outlook for delivering growth
ahead of our 3-5% target range, with an underlying improvement in operating
margin."
Patrick Cescau, Group Chief Executive
31 July
2008
UNILEVER
SECOND
QUARTER AND
HALF YEAR
RESULTS 2008
In the following commentary we report underlying sales growth (abbreviated
to ‘USG’ or ‘growth’) at constant exchange rates,
excluding the effects of acquisitions and disposals. Turnover includes
the impact of exchange rates, acquisitions and disposals. Unilever
uses ‘constant rate’ and ‘underlying’ measures
primarily for internal performance analysis and targeting purposes. We
also comment on trends in operating margins before RDIs (restructuring,
disposals and impairments), and use the movements in Ungeared Free Cash
Flow and Return On Invested Capital to measure progress against our
longer-term value creation goals. Unilever believes that such measures
provide additional information for shareholders on underlying business
performance trends. Such measures are not defined under IFRS and are
not intended to be a substitute for GAAP measures of turnover, operating
margin, profit, EPS and cash flow. Please refer also to note 2 to the
financial statements. Further information about these measures is
available on our website at
www.unilever.com/ourcompany/investorcentre
This results announcement also represents Unilever's half-yearly report for
the purposes of the Disclosure and Transparency Rules (DTR) made by the UK
Financial Services Authority (DTR 4.2 - Half-yearly financial reports). In
this context: (i) the condensed set of financial statements can be found on
pages 8 to 16; (ii) pages 1 to 7 comprise the interim management report;
and (iii) the Directors' responsibility state
ment can be found on page 17. Other than as disclosed elsewhere in this
document n
o material related parties transactions have taken place in the first six
months of the year.
1.
SUMMARY OF BUSINESS PERFORMANCE FOR
THE
SECOND QUARTER AND
FIRST HALF YEAR
Underlying s
ales gr
owth was
6.8% in the second quarter, taking the half year rate to
7.0%. Prices increased by 7.4% in the second quarter and by 6.1% in the first half
year.
Europe
grew by 2.3% in both the quarter and the half year. All
of the growth has come from pricing, with volumes 2.9% lower in the second quarter.
The lower volumes largely reflect weaker ice cream sales and
the expected reversal of the additional sales at the end of the first quarter ahead
of price increases and systems implementations.
The
Americas
has sustained its momentum with growth of 5.7% in the
first half year. This was achieved against a strong comparator which included the
impact of additional sales ahead of the systems change in the
US
in June last year. In Latin America growth accelerated in
both value and volume including a good performance in
Brazil
.
Growth in Asia Africa picked up further to 15.1% in the second
quarter and is broad-based across countries with double-digit increases almost
everywhere. In addition to pricing, volume growth was robust at 4.1% in the second
quarter.
At a global level, all categories grew by more than 5% in the
first half year.
Advertising investment behind our brands was increased by some
€100 million at constant rates of exchange in the first half year. With the
benefit of higher sales, media efficiency programmes and fewer promotions, A&P
as a percentage of sales was 0.7 points lower in the second quarter and 0.4 points
lower in the first half year.
Commodity costs increased by
around
€
60
0 million in the second quarter
and
by
around €1 billion in the first half
. This
is
equivalent to 5.5 percentage points of sales
in the quarter and
4.8
pe
r
centage
points in the first half. Both price increases and
savings from cost reduction programmes accelerated in the
second
quarter. As a result we were able to deliver an underlying
improvement in operating margin of 0.5 percentage points in the quarter, taking the
first half year improvement to 0.4 percentage points.
Underlying sales growth was 6.8% in the second quarter and 7.0%
in the first half year. The Euro has strengthened against most currencies and this,
together with
a small
net impact of acquisitions and disposals, led to turnover being
1.4% lower in the second quarter and 0.5% lower in the first six months.
Operating profit was
5
% lower than last year in the second quarter because of the
stren
g
thening of the Euro and a higher level of restructuring
charges. The operating margin at 13.2% was 0.5 percentage points below last year.
Before the impact of restructuring and disposals there was an underlying
improvement of 0.5 percentage points.
For the half year, operating profit was 16% higher than last
year and the operating margin of 16.0% was 2.3 percentage points higher, both being
boosted by profits on disposals in the first quarter. Before restructuring and
disposals there was an underlying improvement in operating margin of 0.4 percentage
points.
2.3
Finance costs and tax
Finance costs
of net borrowings
were 16% lower than last year in the quarter and in line with
last year for the first six months.
The
effective
tax rate was 28% in the second quarter and 25% in the first
half year. This compares with 19% and 20% in the second quarter and first half of
last year respectively, both of which included benefits from the favourable
settlement of tax audits. The underlying tax rate, before restructuring and
disposals, was 26% in the first half of this year.
For the full year we expect the
tax rate on this basis
to be around 25%.
2.4
Joint ventures, associates and other income from non-current
investments
Share of net profit from joint ventures and associates and
other income from non-current investments for the second quarter was in line with
last year at €39 million. For the first half year these contributed €92
million, which was €47 million below last year as a result of a lower level of
one-time gains in the first quarter.
2.
5
Net profit and earnings per share
Net profit was 19% lower than last year in the second quarter,
reflecting higher restructuring costs, the low tax rate in the same quarter last
year and the stronger
e
uro.
Net profit was 5% higher in the first six months with a benefit
from profits on disposals, but a negative impact from the stronger
euro
.
Earnings per share for the first six months were €0.79
which included a net gain of €0.0
7
from restructuring and disposals. This compares with
€0.75 in the first six months of last year which included a negligible net
impact from restructuring and disposals and benefited from the particularly low tax
rate.
By the end of June we had bought back
53.6
million shares at a
total purchase price
of
€
1.1
billion
, as part of the planned 2008 share buy-back of at least
€1.5 billion
.
Net cash flow from operating activities was €0.7 billion
lower than last year. This was entirely due to a
build-
up of
working capital in the first half year. Part of this came
from the effect of commodity price inflation. In addition there were a number of
temporary factors
including
the planned build
-
up of stocks during the change programme
and
calendar effects. The largely one-off nature of these, together
with an intensified programme for working capital management across the business,
is
expected to result in a much improved cash flow in the
second half year.
Restructuring costs were slightly higher
than in the first half of 2007
, but this was more than offset by lower cash contributions to
pension funds and favourable tax rebates.
Net capital expenditure was also slightly higher than last
year.
Working capital has increased from its normal seasonal low
point at the start of the year. The increase has been heightened by
the
factors referred to above in the commentary on cash flow
movements
.
The overall funding position of the Group's pension
arrangements improved slightly with net liabilities for all schemes of €1.0
billion at the end of
the half year
, down from €1.1
billion at the end of 2007.
Assets have redu
ced by €2.1 billion due to the fall in market values and
the appreciation of the euro against the currencies of investments.
Liabilities fell by €2.2 billion
,
mainly due to the impact of higher discount rates, net of
higher inflation assumptions and the strengthening of the euro.
*
Restructuring, business disposals and
other items
Underlying sales growth was 2.3% in both the quarter and the
half year, slightly behind the growth of our markets.
Central and
Eastern Europe
maintained its growth of around 10% with further growth
in volumes in the second quarter and increased pricing.
Russia
made a particularly strong contribution.
Western Europe
grew b
y 1.4% in the second quarter, and by 1.3% in the first half
year. Increased prices were partly offset by lower volumes in ice cream and the
expected reversal of the additional sales at the end of the first quarter ahead of
price increases and systems implementations.
Germany
grew modestly in the second quarter, with an improved
performance in spreads, after a
weak
start to the year. Benelux had another good quarter with
continued strong growth in the
Netherlands
across most categories, and a pick-up in
Belgium
. In both the
UK
and
Italy
, savoury and dressings contributed to solid growth. Sales
in
France
and
Spain
declined in difficult trading conditions and in both
countries we have lost some share to private label brands.
Hellmann's
extra light
mayonnaise made with free range eggs is part of a campaign to
promote the goodness of mayonnaise in the
UK
,
France
and
Italy
.
Rama
flavoured creams have been launched in
Germany
and the Nordic countries.
In tea, we have built further on the Rainforest Alliance
certification, extended
Lipton
linea
slimming teas and introduced
Lipton
clear green
, a new generation of healthy tea. A strong programme
for
Magnum
ice creams included new-look 'minis' across the region,
and the top-of-the-range 'temptation' introduced to several new
countries.
A new range of
Axe
body washes and after shave balms has been launched in
the
UK
,
Germany
and
France
and the latest global body spray
Axe
dark temptation
across the region. The new upside-down deodorants
for
Dove
and
Rexona
offer the smoothest ever roll-on with less packaging
material.
Small & mighty
concentrated detergents are
being rolled out across the region
under the
Dirt is Good
brand. As well as offering consumer convenience, these
also
have a
markedly
better environmental footprint.
In oral care we have launched
Signal
white now
, the first instant whitening toothpaste.
The first half year operating margin of 20.1% was 6.0
percentage points higher than last year, largely reflecting profits on disposals.
Before restructuring and disposals there was an underlying improvement in margin of
1.0 percentage point. Gross margins were lower as we recovered cost increases in
absolute terms but not yet sufficiently to maintain the percentage margin. However
this was more than compensated by sharply lower overheads costs.
As previously announced,
Western
Europe
will
be managed as a single region under a new President, Doug
Baillie
. This will
allow the management to focus solely on driving improved
performance in the region. Central and Eastern Europe
will
now
be
under the responsibility of Harish Manwani, President for
Asia Africa, reflecting the priority on business building in developing and
emerging markets. These changes will be reflected in the regional segmentation of
Unilever's published results from the end of this year.
In the second quarter we completed the move to a single office
location in
Italy
,
and announced four
factory rationalisations and the setting up of a new
multi-country organisation for
Central Europe
.
The move to a single SAP system for the region continues
,
with three quarters of our business now live and the full
programme to be complete by the end of the year. In July we announced the disposal
of
the
Ber
t
olli
olive oil
business
and three local
bottled oil
brands
in
Italy
.
*
Restructuring, business disposals and
other items
The good momentum in the business has been sustained
,
with underlying sales growth of 5.7% in the first
six
months, against a strong comparator
due to
the additional sales ahead
of
the systems implementation in the
US
at
the end of the second quarter last year. This held back the
second quarter growth for the region as a whole by some 2 percentage points
.
In the
US
all of the growth is coming from price, with consumer
volumes lower than a year ago.
Before the effect of the systems implementation last year,
which reverse
d
in July,
our own sales in
the
US
grew by about 4% in both the second quarter and the first
six months
, slightly ahead of the market growth rate
.
Canada
had a weak second quarter.
Our growth in
Latin America
has been strong across all the main countries, with 13%
in the second quarter taking the half year growth rate to 11%. There has been a
good performance in
Brazil
and continued high growth in
Mexico
and elsewhere.
New ranges of
Knorr
bouillons, sauces and soups have been launched in
Brazil
and
Argentina
with a clear Vitality positioning, featuring healthy
ingredients. Under the
Hellmann's
brand we have introduced an olive oil mayonnaise in
the
US
and a new milder tasting mayonnaise made with milk
in
Brazil
and
Mexico
.
Bertolli
frozen meals in the
US
have been extended with a range of 'mediterranean garden'
dishes.
The latest global
Dove
range, 'go fresh', has been launched in the
US
, as well as a new cream oil variant, 'sleek satin'. As
in
Europe
,
Axe
has brought out body washes targeted at over 20's and the
new 'dark temptation' deodorant with a novel chocolate fragrance. In Laundry the
new
Dirt is Good
mix with improved cleaning and longer-lasting freshness
has been introduced to
Latin America
as well as a variant of
Surf
with fabric conditioner. New variants of 3 times
concentrated liquid detergents have been launched in the
US
.
The operating margin for the first half year was 13.7%, which
was 0.9 percentage points lower than last year. Before
the impact of restructuring and disposals, there was an
underlying reduction in margin of 0.6 percentage points. We have fully recovered
the impact of higher commodity cost
s
in absolute terms, through a combination of savings and
price increases, but this has not been enough to maintain the percentage margin.
As part of the One Unilever programme, the move to a single
head office for the
US
business in Englewood Cliffs and the closure of
the
Greenwich
office has been completed. At the same time, the ice
cream businesses in the
US
and
Canada
have been integrated into the respective One Unilever
country organisations. In
Latin America
, the financial
shared
services centre has been sold to Cap
g
emini. We have also announced the disposal of olive oil sold
under the
Bertolli
brand as part of a global agreement
, and the sale of the North American laundry business.
*
Restructuring, business disposals and
other items
Underlying sales growth was 15.1% in the second quarter and
14.7% in the first half year. While mo
re
of the growth in value is coming from pricing, volumes
also continue to grow well, albeit at a slightly slower pace than last year
. Our
g
rowth continues to be very broad-based
and is ahead of the market
. All of our top five D&E businesses in the region, and all
our categories, grew at more than 10%.
In
India
, laundry contributed particularly strongly with good growth in
all three of our brands
,
each positioned at a different income level. The new
global
Sunsilk
mix is driving share gain in
India
as elsewhere in the region.
China
has sustained a growth rate of over 20%, with most of
this coming from higher volumes including the build of
Clear
shampoo.
Indonesia
has shown continued strong growth momentum,
particular
l
y in personal care and ice cream.
Turkey
had another good, well balanced performance,
however
growth in
South Africa
came entirely from price, with volumes flat, largely as a
result of supply chain constraints.
Performance in
Japan
and
Australia
was
weak in more difficult consumer markets.
We have launched
Lipton
milk tea in a number of new countries and
introduced
Lipton
clear green
teas in
Turkey
and
Arabia
. A strong programme for
Cornetto
ice cream includes a new 'choco disk' variant and we have
introduced
Magnum
chocolate indulgence in
China
and
India
. In
Turkey
we have launched
Knorr
e
at in colour mealmakers and mayonnaise in a squeezy
bottle.
Rexona
is taking the first steps to building a market for
deodorants in
China
. New versions of
Pond
'
s
anti-ageing and
skin
-
lightening creams and the new global
Sunsilk
range have been rolled
out across the region. Innovations in laundry
include
Surf
clean and fresh,
Surf
Excel
multi-chamber sachets, the improved global
Dirt
is
Good
mix and concentrated fabric conditioners.
The operating margin for the first six months was 13.3%, which
was 1.2 percentage points higher than a year ago. Before the impact of
restructuring and disposals there was an underlying improvement of 0.8 percentage
points. Savings programmes and price increases have offset the impact of higher
commodity costs and we have the benefit of increased scale from sales growth.
The move to a single SAP system across the region is
progressing
to plan and
we are setting up a regional supply chain team based
in
Singapore
.
In the second quarter we announced the disposal of our palm oil
business in
Cote D'Ivoire
and the acquisition of laundry soaps in the same country.
We have also announced the disposal of Komili olive oil in
Turkey
.
Both these transactions are subject to regulatory
approval.
Central and
Eastern Europe
will
be managed as part of this region. This reflects
the
focus on
business building in these countries as part of
Unilever's priority for Developing and Emerging markets. The change will be
reflected in our reporting of business segments from the end of this year.
On pages
13 and 14 of our 2007 Report and Accounts we set out our
assessment of the principal risk issues that would face the business through 2008.
In our view, the nature and potential impact of such risks remains essentially
unchanged
as regards our performance over the second half of the
year
. As anticipated, commodity prices
affecting the materials we buy
have continued to show an upward trend in the first half of the
year.
W
e will continue to monitor
this
closely and to manage our response through a combination of
pricing
and
savings
programmes
. In addition,
there could be a further weakening of key economies. W
hilst people's essential needs for food and hygiene would
remain unchanged, we could experience impact in markets as individual consumers
adjust their spending patterns. We manage the associated risks
by ensuring that our brands remain competitive through
appropriate pricing, marketing
support and relevant innovation in our
product
portfolio
across
a wide range of
price points.
On 10 April 2008, Unilever entered into a settlement with
Mars to bring an end to all claims made by Mars concerning Unilever's
distribution arrangements for the sale of impulse ice cream. Prior to the
settlement, Mars had initiated proceedings against Unilever in a number of European
jurisdictions. The settlement does not imply any admission of liability on
Unilever's part.
In April 2008 Unilever received a notice from the UK Office of
Fair Trading requiring the production of documents in relation to an investigation
into potential co-ordination of the retail prices of products in the grocery
sector. A response to the notice was provided in June 2008. It is too early to
gauge whether the investigation to which the notice relates will lead to a
Statement of Objections being addressed to Unilever or its subsidiaries.
In June 200
8, Unilever premises in
Austria
,
Belgium
,
Italy
, The Netherlands and
Spain
were the subject of unannounced inspections by the
European Commission and/or national competition authorities. The inspections were
in relation to the home care and/or personal care markets. A request for
information relating to alleged anti-competitive behaviour in detergents markets in
the EEA was subsequently received by Unilever in July 2008. It is too early to
gauge whether the investigation that has been initiated will lead to a Statement of
Objections being addressed to Unilever or its subsidiaries.
This announcement may contain forward-looking statements,
including 'forward-looking statements' within the meaning of the United States
Private Securities Litigation Reform Act of 1995. Words such as 'expects',
'anticipates', 'intends' or the negative of these terms and other similar
expressions of future performance or results, including financial objectives to
2010, and their negatives are intended to identify such forward-looking statements.
These forward-looking statements are based upon current expectations and
assumptions regarding anticipated developments and other factors affecting the
Group. They are not historical facts, nor are they guarantees of future
performance. Because these forward-looking statements involve risks and
uncertainties, there are important factors that could cause actual results to
differ materially from those expressed or implied by these forward-looking
statements, including, among others, competitive pricing and activities,
consumption levels, costs, the ability to maintain and manage key customer
relationships and supply chain sources, currency values, interest rates, the
ability to integrate acquisitions and complete planned divestitures, physical
risks, environmental risks, the ability to manage regulatory, tax and legal matters
and resolve pending matters within current estimates, legislative, fiscal and
regulatory developments, political, economic and social conditions in the
geographic markets where the Group operates and new or changed priorities of the
Boards. Further details of potential risks and uncertainties affecting the Group
are described in the Group's filings with the London Stock Exchange, Euronext
Amsterdam and the US Securities and Exchange Commission, including the Annual
Report on Form 20-F. These forward-looking statements speak only as of the date of
this document. Except as required by any applicable law or regulation, the Group
expressly disclaims any obligation or undertaking to release publicly any updates
or revisions to any forward-looking statements contained herein to reflect any
change in the Group's expectations with regard thereto or any change in events,
conditions or circumstances on wh
ich any such statement is based.
Media:
Media Relations Team
UK +44 20 7822 6805
tim.johns@unilever.com
or +44 20 7822 6010
trevor.gorin@unilever.com
NL +31 10 217 4844
gerbert-van.genderenstort@unilever.com
|
Investors:
Investor Relations Team
+44 20 7822 6830
investor.relations@unilever.com
|
There will be a web cast of the results presentation available
at:
www.unilever.com/ourcompany/investorcentre/results/quarterlyresults/default.asp
The results for the
third
quarter 2008
and the announcement of interim dividends
will be published on
30 October
2008.
C
ONDENSED FINANCIAL STATEMENTS
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After (charging)/crediting:
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Restructuring
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(see note 3)
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Pensions and similar obligations
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Share in net profit/(loss) of joint ventures
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Share in net profit/(loss) of associates
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Other income from non-current investments
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Net profit from continuing operations
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|
|
|
|
|
|
Net profit/(loss) from discontinued
operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit for the period
|
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|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
Combined earnings per share
|
|
|
|
|
|
|
|
|
Continuing operations (Euros)
|
|
|
|
|
|
|
|
|
Continuing operations - diluted
(Euros)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations (Euros)
|
|
|
|
|
|
|
|
|
Discontinued operations - diluted
(Euros)
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
Total operations - diluted (Euros)
|
|
|
|
|
STATEMENT OF RECOGNISED INCOME AND EXPENSE
|
|
|
|
|
|
|
|
Fair value gains/(losses) on financial instruments
net of tax
|
|
|
Actuarial gains/(losses) on pension schemes net of
tax
|
|
|
Currency retranslation gains/(losses) net of
tax
|
|
|
|
|
|
Net income/(expense) recognised directly in
equity
|
|
|
|
|
|
Net profit for the period
|
|
|
|
|
|
Total recognised income and expense for the
period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from operating activities
|
|
|
|
|
|
Net cash flow from operating
activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions and disposals
|
|
|
Other investing activities
|
|
|
Net cash flow from/(used in) investing
activities
|
|
|
|
|
|
|
|
|
Dividends paid on ordinary share capital
|
|
|
Interest and preference dividends paid
|
|
|
Change in financial liabilities
|
|
|
|
|
|
Other movements on treasury stock
|
|
|
Other financing activities
|
|
|
Net cash flow from/(used in) financing
activities
|
|
|
|
|
|
Net increase/(decrease) in cash and cash
equivalents
|
|
|
|
|
|
Cash and cash equivalents at the beginning of
the year
|
|
|
|
|
|
Effect of foreign exchange rate changes
|
|
|
|
|
|
Cash and cash equivalents at the end of
period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment
|
|
|
|
Pension asset for funded schemes in surplus
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and other current receivables
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
Non-current assets held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables and other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities associated with non-current assets held
for sale
|
|
|
|
Total current liabilities
|
|
|
|
Net current assets/(liabilities)
|
|
|
|
Total assets less current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities due after one year
|
|
|
|
Non-current tax liabilities
|
|
|
|
Pensions and post-retirement healthcare benefits
liabilities:
|
|
|
|
Funded
schemes in deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-current liabilities
|
|
|
|
Total non-current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
NOTES TO THE FINANCIAL STATEMENTS
1
ACCOUNTING INFORMATION AND P
OLICIES
The condensed interim financial statements are based on
International Financial Reporting Standards (IFRS) as adopted by the EU and IFRS as
issued by the International Accounting Standards Board, and have been prepared in
accordance with International Accounting Standard (IAS) 34 'Interim Financial
Reporting'. The basis of preparation is consistent with
that applied for
the year ended 31 December 200
7.
The condensed financial statements are shown at current
exchange rates, while percentage year-on-year changes are shown at both current and
cons
tant exchange rates to facilitate comparison.
The income statement on page
8 and
the statement of recognised income and expense and the
cash flow statement on page
9
are translated at rates current in each period.
The balance sheet on page
10 is
translated at period-end rates of exchange.
The financial statements attached do not constitute the full
financial statements within the meaning of Section 240 of the UK Companies Act
1985. Full accounts for Unilever for the year ended 31 December 200
7
have been delivered to
the Registrar of Companies. The auditors' report on these
accounts was unqualified and did not contain a statement under Section 237(2) or
Section 237(3) of the UK Companies Act 1985.
In our financial reporting we use certain measures that are not recognised
under IFRS or other generally accepted accounting
principles (GAAP). We do this because we believe that these measures are
useful to investors and other users of our financial
statements in helping them to understand underlying business performance.
Wherever we use such measures, we make clear that
these are not intended as a substitute for recognised GAAP measures.
Wherever appropriate and practical, we provide
reconciliations to relevant GAAP measures.
The principal non-GAAP measure which we apply in our quarterly
reporting is underlying sales growth, which we reconcile to changes in the GAAP
measure turnover in
notes
4
and
5
.
In note 8 we
reconcile net debt to the amounts reported in our balance
sheet and cash flow statement.
We also comment on underlying trends in operating profit, by
which we mean
the movements recorded after setting aside the impact of
restructuring, disposals and impairments, on the grounds that the incidence of
these items is uneven between quarterly reporting periods. We specifically avoid
referring to a measure of 'underlying operating profit', since such a term might
imply that we did not regard the items involved, particularly restructuring costs,
as an ongoing element of our business over the longer term.
In addition, we
report annually against two further non-GAAP measures:
Ungeared Free Cash Flow and Return on Invested Capital. Further information about
these measures and their reconciliation to GAAP measures is given on on our website
at
www.unilever.com/investorcentre
3 SIGNIFICANT ITEMS WITHIN
THE
INCOME STATEMENT
In our income statement reporting we recognise restructuring
costs, profits and losses on business disposals and certain other one-off items,
which we collectively term RDIs. We disclose on the face of our income statement
the total value of such items that arise within operating profit. In our operating
review by geographic segment and in
note
4
we highlight the impact of these items on our operating
margin. The impact of these items
, and of similar items arising within other elements of our
income statement, on our reported net profit was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
RDIs within operating profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax effect of RDIs within operating profit:
|
|
|
|
|
|
RDIs arising below operating profit:
|
|
|
|
|
|
Total impact of RDIs on net profit
|
|
|
|
|
|
|
|
|
The impact of RDIs on reported Earnings Per Share is
given
in note
10
.
4
SEGMENTAL ANALYSIS BY GEOGRAPHY
On 28 February 2008 Unilever announced a number of
organisational changes. As part of these changes, our operations in Central and
Eastern Europe will in future be managed within an enlarged region together with
those in Asia and Africa, with
Western Europe
becoming a standalone region. Since these changes are
taking place progressively during the remainder of 2008, we are continuing to
report quarterly against our structure as it applied in 2007. In our fourth quarter
reporting for 2008 we will provide additional analysis of our regional results
against the new structure, including restated amounts for each of the quarters of
2008, and will report on the new basis thereafter.
Continuing operations -
Second
Quarter
|
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|
|
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|
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|
|
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|
|
|
|
|
|
|
|
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|
|
|
|
|
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|
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|
|
|
|
|
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|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
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|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Includes restructuring, business disposals and
other items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations -
Half
Year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Includes restructuring, business disposals and
other items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5
SEGMENTAL ANALYSIS BY PRODUCT AREA
Continuing operations -
Second
Quarter
|
|
Savoury, dressings and spreads
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
Continuing operations -
Half
Year
The
effective
tax rate for
the first half year
was
25
% compared with
20
% for
the first half of 2007
. The tax rate is calculated by dividing the tax charge by
pre-tax profit excluding the contribution of joint ventures and
associates.
7
Reconciliation of net profit to cash flow from
operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of net profit of joint ventures/associates
and other income from non-current investments
|
|
|
|
|
|
Operating profit (continuing and discontinued
operations)
|
|
|
Depreciation, amortisation and impairment
|
|
|
Changes in working capital
|
|
|
Pensions and similar provisions less
payments
|
|
|
Restructuring and other provisions less
payments
|
|
|
Elimination of (profits)/losses on
disposals
|
|
|
Non-cash charge for share-based compensation
|
|
|
|
|
|
Cash flow from operating activities
|
|
|
|
|
|
|
|
|
Total financial liabilities
|
|
|
Financial liabilities due within one year
|
|
|
Financial liabilities due after one year
|
|
|
Cash and cash equivalents as per balance
sheet
|
|
|
Cash and cash equivalents as per cash flow
statement
|
|
|
Add bank overdrafts deducted therein
|
|
|
|
|
|
|
|
|
On 21 February 2008 we issued Swiss franc notes to the value of
CHF 600 million (€360 million) in two tranches: CHF 250 million with an
interest rate of 3.125% and maturing in January 2012, and CHF 350 million at 3.5%
maturing in March 2015.
On 21 May 2008
we
issued €750 million fixed rate notes with a coupon rate of
4.875%, repayable in 2013.
|
|
|
|
|
|
|
|
|
|
|
Total recognised income and expense for the
period
|
|
|
|
|
|
Movement in treasury stock
|
|
|
Share-based payment credit
|
|
|
Dividends paid to minority shareholders
|
|
|
Currency retranslation gains/(losses) net of
tax
|
|
|
Other movements in equity
|
|
|
Equity at the end of the period
|
|
|
During the
first half year we purchased
shares to the value of €
1.1
billion under the share buy-back programme announced in March
2007.
10
COMBINED EARNINGS PER SHARE
The combined earnings per share calculations are based on the
average number of share units representing the combined ordinary shares of NV and
PLC in issue during the period, less the average number of shares held as treasury
stock.
In calculating diluted earnings per share, a number of
adjustments are made to the number of shares, principally the
following:
(i) conversion into PLC ordinary shares in the year 2038 of
shares in a group company under the arrangements for the variation of the
Leverhulme Trust and (ii) the exercise of share options by employees.
Earnings per share for total operations for the
first half year
were calculated as follows:
|
|
|
|
|
|
|
|
Average number of combined share units
|
|
|
|
|
|
|
|
Net profit attributable to shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted average number of combined share
units
|
|
|
|
|
|
Combined EPS - diluted (Euros)
|
|
|
Impact of RDIs on Earnings Per Share
|
|
|
|
|
Total impact of RDIs on reported net
profit
(see note 3)
|
|
|
|
|
|
Impact of RDIs on basic earnin
g
s per share (Euros)
|
|
|
Earnings per share in US Dollars and
Sterling
|
|
|
|
|
|
Combined EPS - diluted (Dollars)
|
|
|
|
|
|
|
|
|
Combined EPS - diluted (Pounds)
|
|
|
The numbers of shares included in the calculation of earnings
per share is an average for the period. During the period the following movements
in shares have taken place:
|
|
|
Numb
er of shares at 31 December 2007
(net of treasury stock)
|
|
|
Net movements in shares under incentive
schemes
|
|
|
|
|
|
Number of shares at
3
0
June
2008
|
|
|
11
A
CQUISITIONS AND DISPOSALS
On 14 November 2007
we
announced that
we
had signed a definitive agreement with McCormick & Company,
Incorporated to sell
our
Lawry's and Adolph's branded seasoning blends and
marinades business in the US and Canada for €410 million. The
transaction
is
expected to be completed
on or around 31 July 2008
. The combined annual
turnover
of the business is approximately €100
million.
Effective 1 January 2008,
we
entered into an expanded international partnership
with Pepsico
for the marketing and distribution of ready-to-drink tea
products under the
Lipton
brand.
On 3 January 2008
we
completed the sale of
the
Boursin brand to Le Groupe Bel for €400 million. The
turnover of this brand in 2007 was approximately €100 million.
On 4 February 2008
we
announced that
we
had signed an agreement to acquire Inmarko, the leading Russian
ice cream
company, for an undisclosed amount. The transaction was
completed on 2 April 2008. The company had a turnover in 2007
of approximately €115 million.
On 19 June 2008
we
announced that
we
had signed an agreement to sell
our
edible oil business in
C
ô
te d'Ivoire
together with
our
interests in local palm oil plantations, Palmci and PHCI. At
the same time
we
plan to acquire the soap business of Cosmivoire, an Ivorian
producer with a market presence throughout Francoph
o
ne West Africa. The dea
l
is subject to approval by the
regulatory
authorities.
On 10 July 2008
we
announced that
we
had signed an agreement to sell Komili, the market leading
olive oil brand in
Turkey
, to Ana Gida, part of the Anadolu Group, for an undisclosed
amount. The transaction, which is subject to regulatory approval, is expected to be
completed by the end of 2008.
On 21 July 2008
we
announced that
we
had signed an agreement with Grupo SOS for the disposal
of
our
Bertolli olive oil and vinegar business, for a consideration of
€630 million. The transaction is structured as a worldwide perpetual licence
by Unilever of the
Bertolli
brand in respect of olive oil and premium vinegar. The
transaction includes the sale of the Italian Maya, Dante and San Giorgio olive oil
and seed oil businesses, as well as the factory at
Inveruno
,
Italy
.
The transaction, which is subject to regulatory
approval, is expected to be completed by the end of 2008.
On 28 July 2008
we
announced that
we
had signed a definitive agreement to sell
our
North American laundry business in the
US
,
Canada
and
Puerto Rico
to Vestar Capital Partners, a leading global private
equity firm
, for a face value of US $1.45 billion
. Vestar will m
e
rge the business with its existing operation, Huish Detergents
Inc., to fo
r
m a new company, The Sun Products Corporation. The
consideration consists of a cash payment of US $1.075 billion, together with
preferred shares in the Sun Products Corporation with a face value of US $375
million, and warrants offering the opportunity to acquire up to 2.5% of the common
equity of the Sun Products Corporation. The businesses to be sold include
the
all
,
Snuggle
,
Wisk
,
Surf
and
Sunlight
fabric cleaning and fabric conditioning brands in
the
US
,
Canada
and Puerto Rico, as well as Unilever's manufacturing
facility in
Baltimore
. These businesses had a combined turnover in 2007 of
approximately US $1.0 billion. The transaction, which is subject to regulatory
approval, is expected to be completed by the end of 2008.
1
2
EVENTS AFTER THE BALANCE SHEET DATE
There were no material post balance sheet events other than
those mentioned elsewhere in this report.
RESPONSIBILITIES OF DIRECTORS
The Directors confirm that this condensed consolidated set
of interim financial statements has been prepared in accordance with IAS
34, and that the interim management report includes a fair review of the
information required by
DTR
4.2.7 and
DTR
4.2.8.
Unilever's Directors are listed in the Annual Report
and Accounts for 2007, with the exception of the following changes:
-
At the Group's AGMs on 14 and 15 May 2008, James
Lawrence was appointed as an Executive Director and Kees van der Graaf
and Ralph Kugler stood down as Executive Directors
-
On 30 June 2008 Genevieve Berger stood down as a
Non-Executive Director in order to take up an executive role as
Unilever's Chief Research and Development Officer
Details of all current Directors are available on our
website at
www.unilever.com
Patrick Cescau
James
Lawrence
Group Chief Executive
Chief Financial Officer
Unilever NV (NYSE:UN)
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