Unilever's EPS Stays Flat Y/Y - Analyst Blog
06 Februar 2012 - 10:45AM
Zacks
Unilever
NV (UN) delivered earnings of €1.46 ($2.03) per
share in the fiscal year 2011, in line with the prior-year period.
Core-earnings increased 4% from the 2010 period to €1.41 ($1.96).
Profits went up based on acquisitions and disposals along with
higher sales.
Consolidated Revenue and
Margins
Unilever’s net sales in 2011
increased 5.0% to €46.5 billion ($64.7 billion) compared with the
prior-year period. The upswing came on the back of acquisitions and
disposals, which delivered a positive contribution of 1.2%.
However, currency translation had a negative impact of 2.5%.
Unilever delivered €11.6 billion ($16.2 billion) net sales in the
fourth quarter.
Underlying sales grew 6.5% in 2011
based on improved price of 4.8% and volume growth of 1.6%. Emerging
markets also delivered an underlying sales growth of 11.5%.
Fourth-quarter underlying sales growth was 6.6%, coming from 6.5%
price growth and 0.1% volume growth.
In the year 2011, advertising and
promotional expenses went up €150 million ($208.9 million) to €6.2
billion ($8.6 billion), including acquisitions.
Operating profits increased 1% year
over year to €6.4 billion ($8.9 billion). However, a reduction in
overheads offsetting the pressure on gross margins from higher
commodity costs, resulted in a decline in underlying operating
margin by 10 bps in 2011.
Region-Wise
Details
Asia
Africa CEE: The region
experienced strong volume growth in the fourth quarter despite
higher prices and challenging macro-economic conditions in many
countries. In addition, Unilever achieved double digit-growth in
South Africa, Indonesia and Vietnam along with robust growth from
India, Turkey and China. However, Japan’s downward trend continued
largely due to the occurrence of earthquake in the first half of
2011, while there seemed little growth in Central & Eastern
Europe.
The
Americas: North America delivered a 2.1%
underlying sales growth in 2011, reflecting both a good performance
from Personal Care and the pricing action taken to recover input
cost increases, particularly in spreads, in-home ice cream and bar
soaps. Latin America also grew 10.8% in 2011 with strong growth
from Argentina and Mexico, with a lesser growth in Brazil.
Western Europe:
Unilever’s six largest markets in Western Europe delivered positive
sales growth in the fourth quarter with strong performances in
France and Italy. However, volumes were negatively impacted by the
action to increase prices, particularly in spreads.
Personal Care, which has now formed
one-third of the business, delivered double-digit growth in the
second half of 2011 and 8% in the year 2011. Underlying sales
growth in the Home Care segment was also around 8% in 2011. In
Refreshment and Foods, the underlying sales were at mid-single
digit at approximately 5%. In Refreshment, the growth was driven by
innovation and new market launches, particularly with Magnum in Ice
Cream, while in Foods, performance was driven by the strong pricing
that was taken, especially in spreads.
Other Financial
Updates
During the fiscal year of 2011,
free cash flow was €3.1 billion ($4.3 billion). Unilever’s Board
also announced to pay a quarterly dividend of €0.225 per share
($0.313 per share) in March, 2012. Net debt was €8.8 billion ($12.3
billion) at year-end, up from the €6.7 billion ($9.3 billion) at
the end of 2010.
Based on the full-year exchange
rate of $1.39284 as on 12/31/11
Currently, Unilever holds a Zacks
#3 Rank, which translates into a short-term ‘Hold’ recommendation.
Moreover, considering the fundamentals, we have a long-term
‘Neutral’ rating on the stock.
UNILEVER N V (UN): Free Stock Analysis Report
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