2nd Nov 2006 07:02
Unilever PLC02 November 2006 THIRD QUARTER AND NINE MONTH RESULTS 2006 AND INTERIM DIVIDENDS Broad-based growth. Margin development in line with our expectations. FINANCIAL HIGHLIGHTS (unaudited) Third Quarter 2006 • million Nine Months 2006------------------------- -------------------------Current Current Constant Current Current Constantrates rates rates rates rates rates Continuing operations: 10 122 2% 4% Turnover 29 915 4% 3% 1 501 (3)% (2)% Operating profit 4 346 7% 5% 1 128 (20)% (19)% Pre-tax profit 3 789 4% 2% 779 (22)% (21)% Net profit from continuing operations 2 787 5% 4% 812 (45)% (45)% Net profit from total operations 2 915 (10)% (11)% 0.25 (24)% (24)% EPS from continuing operations (Euros) 0.90 5% 4% 0.25 (47)% (47)% EPS from total operations (Euros) 0.94 (11)% (12)% KEY FEATURES • Underlying sales growth of 4.8% in the quarter and 3.9% in the first nine months. • Operating margin of 14.8% in the quarter and 14.5% in the first nine months. • Increased investment in advertising and promotions behind key mid-year innovations. • Pricing actions and productivity gains fully offset cost increases. • Provision of €300 million taken for possible compensation payments relating to the 2005 conversion of preference shares, issued by Unilever N.V. in 1999. • Interim dividend of €0.23 for NV and 15.62p for PLC. • €750 million additional one-off dividend (€0.26 for NV and 17.66p for PLC), replacing 2006 share buy-back of €500 million. Share buy-back programme of €1.5 billion planned to commence in 2007. GROUP CHIEF EXECUTIVE'S COMMENT We continue to see good progress with another quarter of broad-based growth. Allcategories and regions grew, with a notable contribution from Europe. Strongerinnovation and additional investment behind our priorities are driving thegrowth of our brands. Pricing actions and continued productivity gains fully offset higher thanexpected input costs. The 'One Unilever' programme is making a substantialcontribution to our cost competitiveness drive. Our global capability programme,now also extended to research and development, is progressing well. During the quarter we announced the sale of frozen foods businesses in Europe ata good price and expect to complete it shortly. Also we have announced today anincrease in the cash to be returned to shareholders in 2006 and plans foradditional returns through share buy-backs, starting in 2007. I am pleased with the sustained improvement in the top line, maintaining themomentum of the first half. Looking ahead our priority is to improve ouroperating margin, while delivering our growth ambitions. We are confident wewill achieve this through a combination of savings, mix improvement andappropriate pricing actions. Patrick Cescau, Group Chief Executive 2 November 2006 In the following commentary, sales growth is stated on an underlying basis atconstant exchange rates and excluding the effects of acquisitions and disposals.Turnover includes the impact of exchange rates and acquisitions and disposals. Unilever uses 'constant rate' and 'underlying' measures primarily for internalperformance analysis and targeting purposes. Unilever believes that suchmeasures provide additional information for shareholders on underlying businessperformance trends. Such measures are not defined under IFRSs or US GAAP and arenot intended to be a substitute for GAAP measures of turnover, profit and cashflow. TURNOVER Turnover increased by 4.4% in the first nine months, with 3.9% underlying salesgrowth. Favourable currency movements added 1.4% with disposals accounting forthe remainder of the change in turnover. In the third quarter underlying salesgrew by 4.8%. Pricing has made an increasing contribution with 0.9% in the first nine monthsand 1.2% in the quarter. All regions and categories grew in both the year todate and the quarter. A strong third quarter for European ice cream added 0.4%to overall third quarter growth and made up for a relatively weak start to theice cream season. OPERATING MARGIN The operating margin for the first nine months at 14.5% was 0.3 percentagepoints higher than a year ago, while the quarter at 14.8% was 0.8 percentagepoints lower. Before the impact of restructuring, disposals and impairments, theoperating margin would have been 0.7 percentage points lower for both the firstnine months and the quarter. Investment behind our brands has been stepped up in priority categories andregions. Advertising and promotions as a percentage of turnover increased by 0.6points in the first nine months and by 0.8 points in the third quarter. Gross margins were in line with last year in the first nine months. Highercommodity costs were fully offset by savings programmes, the benefits of volumegrowth and mix, and a positive contribution from pricing. NET PROFIT AND EARNINGS PER SHARE Net finance costs benefited from a lower level of net debt, an improved mixbetween countries and the effect of a higher asset base in our pension funds. Finance costs for the quarter also included a€300 million provision relating to preference shares. In September 2006investigators appointed by the Dutch Enterprise Chamber published their reportinto the issuance and subsequent conversion of Unilever N.V.'s 1999 PreferenceShares. The Unilever Board established a Committee, chaired by Professor WimDik, to consider the Company's response. The Committee has explored thepossibility of a settlement. It is expected that the Board, which has as yetmade no decision on this matter, will consider the Committee's recommendationshortly. The tax rate was 26% for the first nine months compared with 28% last year. Thelower rates this year include a better country mix and other improvements. Inthe third quarter the tax rate was 31%, which is adversely affected by arelatively low assumed rate for the tax credit on the preference shareprovision. Share of net profit from joint ventures was ahead of last year due to continuedgrowth in the partnerships between Lipton and Pepsi for ready-to-drink tea. Net profit from continuing operations increased by 5% in the first nine monthsand decreased by 22% in the quarter, following the preference shares provision.Net profit, including discontinued operations, was down by 45% in the quarter,additionally reflecting the profit on disposal of UCI in the third quarter oflast year. EPS from continuing operations increased by 5% in the first nine months. CASH FLOW Net cash flow from operating activities was €0.3 billion higher than last yearin the first nine months. Lower tax payments more than offset higher cashpayments to pension schemes in the period. The seasonal outflow of workingcapital was in line with last year. Capital expenditure has been increasedbehind our innovation programme. Net debt has been reduced by €1.3 billion since the start of the year. BALANCE SHEET The Euro strengthened against a number of currencies, most significantly the USdollar, reducing balance sheet values. DIVIDENDS AND SHARE BUY BACKS The sale of European frozen foods businesses is now expected to complete veryshortly and for a price at the top end of our expectations. We have not investedany significant amounts in acquisitions. We have therefore decided to return anadditional €250 million to shareholders this year over and above the originallyplanned €500 million share buy-back. The simplest way of achieving this isthrough a one-off dividend of €750 million to be paid at the same time as the normal interim dividend. Looking forward, we plan a share buy-back programme of €1.5 billion, commencing in 2007. PERFORMANCE BY REGION EUROPE (38% OF SALES) Underlying sales grew by 1.4% in the first nine months, and by 3.5% in the thirdquarter. Growth is mainly volume driven and in aggregate across categories weare growing in line with our markets. A key driver of the overall improvement has been the impact of Vitality-ledinnovation in savoury, spreads and leaf tea. Ice cream grew for the seasonoverall, with a strong third quarter adding 1.4% to European growth in thequarter. This made up for lower ice cream sales in the first half year. Personal care grew well through innovation and consumer activation. We have lostsome share in laundry in competitive markets. There were improvements in a number of key countries in the third quarter. TheUK has returned to growth and France and Germany also performed better. TheNetherlands continues to move ahead strongly and Russia is growing well. The theme of Vitality runs clearly through the innovation programme. AdeZdrinks, combining the goodness of soya with the refreshment, taste and health offruit juice have been launched in the UK, building on success in Latin America.A range of Knorr bouillon cubes with selected natural ingredients and a better,richer taste has been rolled out across the region and Vie 'one shot' fruit andvegetable drinks are now available in ten countries. 'Fresh' soups in poucheswith premium ingredients and tasty recipes have been rolled out to a furtherseven countries. Product launches in Home and Personal Care with clear functional or emotionalbenefits are being rolled out rapidly across the region. Dove 'Summer Glow',offers gentle self-tanning from a trusted brand and the latest Axe fragrance'Click' is being introduced. New Cif Power Cream combines convenience with highperformance. The operating margin for the first nine months at 15.0% was 1.8 percentagepoints lower than last year. This includes the impact of input cost increases,competitive pricing, higher net costs for restructuring and disposals, andhigher investment in advertising and promotions. These were only partly offsetby savings programmes. THE AMERICAS (35% OF SALES) Underlying sales growth has accelerated progressively through the year, with3.5% in the first nine months and 4.1% in the third quarter. This is mainlydriven by volume gains with price increases adding 1.4% in the first ninemonths. Markets in the US continue to grow solidly. In the rest of the regionHome and Personal Care markets are buoyant, with Foods somewhat slower. Sales in the US have grown by around 3% in both the quarter and the year todate. We have gained market share in Foods, including further gains in ice creamand the continued success of Bertolli frozen meals and Country Crock sidedishes. Lipton ready-to-drink tea has also achieved a substantial share gain,which is not consolidated in turnover but shows through in the profit from jointventures. There has been good innovation-driven growth and share gains indeodorants and hair care, with sales of the newly launched Sunsilk on plan. Sales in Brazil picked up in the third quarter with strong growth in personalcare categories and laundry. Foods sales in Brazil grew only modestly in theface of slow markets and strong local price competition. In Mexico, sales were below last year in both the quarter and the year to date.Home and Personal Care returned to growth in the quarter but Foods declined insluggish markets. There was strong growth elsewhere in the region with a number of countriesgrowing more than 10%. Products introduced this year in the US include further development of theBertolli premium frozen meal range, Wishbone salad 'spritzers', with one calorieper spray, and Lipton pyramid tea bags. Launches under the Breyers ice creambrand include more creamy varieties of 'double churn'. New Knorr soups and bouillons across the region cater for local flavour andtastes while sharing common product platforms. The highly successful AdeSnutritional drink has been extended with a 'light' variant, new fruit flavoursand the launch of Soymilk in Brazil and Mexico. We have strengthened our hair portfolio in the US. Sunsilk, with ranges tailoredto tackle individual hair 'dramas', was launched in the middle of the year. Thisfollowed the successful relaunch of the Suave 'Professionals' range withimproved margins. The Dove skin range has been further extended throughout theregion including the 'glow' and 'no white marks' products which meet clearconsumer needs. In Brazil, the Omo laundry brand has been further strengthenedwith a new top performance product and 'baby' and 'foam control' variants. The operating margin for the first nine months, at 15.5%was 3.8 percentage points higher than last year which included the impairmentcharge for Slim Fast in the second quarter. Before this, the operating marginwas in line with last year. Price increases and savings programmes fully offsetthe impact of increased investment in advertising and promotions and higherinput costs. ASIA AFRICA (27% OF SALES) Underlying sales grew by 8.0% in the first nine months and by 7.5% in the thirdquarter. While growth remains mainly volume driven, there was a further step upin price in the third quarter, to 2.3%, as we took action to mitigate theeffects of higher input costs. Markets remain generally buoyant and our aggregate market shares across theregion remain stable, as we delivered good growth from strong positions acrossall categories. India has sustained double-digit sales increases across almost all categories. Amix of global, regional and local brands are driving growth, notably Surf,Wheel, Lux, Lifebuoy and Clinic. Tea rebounded strongly after a weaker firsthalf. China has been very strong this year with another quarter of excellent growth.We have gained share in most categories through better distribution andinnovation behind brands such as Omo, Zonghua, Lux and Pond's. Lipton teas alsoperformed well. Indonesia, Vietnam and Turkey have all sustained very good momentum through theyear. Sales in South Africa slowed in the third quarter through low pricecompetition in laundry, but Foods and personal care continued to move aheadwell. In the developed markets, an improved performance in Australia has beensustained, while Japan remains difficult. Increasingly, innovation activity has been driven globally and regionally ratherthan locally. The new Sunsilk range has been introduced in most major marketsand in laundry the global 'Dirt is Good' positioning is now in place across theregion. The latest Axe/Lynx fragrance, 'Click' has been introduced in Australiaand New Zealand. Lux 'Super Damage Repair System' for hair has been launched inJapan and China. In Foods, low unit priced Knorr bouillon cubes, already successful in LatinAmerica, have been brought to the region and Green Tea innovations are beingrolled out extensively. In South Africa, the new Rama brand communicates thehealthy oils in the product, a theme being used elsewhere around the world. The operating margin for the first nine months at 12.6% was 0.8 percentagepoints lower than a year ago, due to increased investment in advertising andpromotions. Price increases and savings programmes offset the impact of higherinput costs. SAFE HARBOUR STATEMENT: This announcement may contain forward-lookingstatements, including 'forward-looking statements' within the meaning of theUnited States Private Securities Litigation Reform Act of 1995. Words such as'expects', 'anticipates', 'intends' or the negative of these terms and othersimilar expressions of future performance or results and their negatives areintended to identify such forward-looking statements. These forward-lookingstatements are based upon current expectations and assumptions regardinganticipated developments and other factors affecting the Group. They are nothistorical facts, nor are they guarantees of future performance. Because theseforward-looking statements involve risks and uncertainties, there are importantfactors that could cause actual results to differ materially from thoseexpressed or implied by these forward-looking statements, including, amongothers, competitive pricing and activities, consumption levels, costs, theability to maintain and manage key customer relationships and supply chainsources, currency values, interest rates, the ability to integrate acquisitionsand complete planned divestitures, physical risks, environmental risks, theability to manage regulatory, tax and legal matters and resolve pending matterswithin current estimates, legislative, fiscal and regulatory developments,political, economic and social conditions in the geographic markets where theGroup operates and new or changed priorities of the Boards. Further details ofpotential risks and uncertainties affecting the Group are described in theGroup's filings with the London Stock Exchange, Euronext Amsterdam and the USSecurities and Exchange Commission, including the Annual Report and Accounts onForm 20-F. These forward-looking statements speak only as of the date of thisdocument. Except as required by any applicable law or regulation, the Groupexpressly disclaims any obligation or undertaking to release publicly anyupdates or revisions to any forward-looking statements contained herein toreflect any change in the Group's expectations with regard thereto or any changein events, conditions or circumstances on which any such statement is based. CONDENSED INTERIM FINANCIAL STATEMENTS INCOME STATEMENT (unaudited) Third Quarter • million Nine Months ------------------- ------------------- 2006 2005 Increase/ 2006 2005 Increase/ (Decrease) (Decrease) Current Constant Current Constant rates rates rates rates Continuing operations: 10 122 9 935 2% 4% Turnover 29 915 28 644 4% 3% 1 501 1 551 (3)% (2)% Operating profit 4 346 4 062 7% 5% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ After (charging)/crediting: (74) (81) Restructuring (235) (130) (4) 10 Business disposals and 151 (245) impairments ------ ------ ------ ------ -------------------- ------ ------ ------ ------ (403) (158) Net finance costs (638) (461) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 33 21 Finance income 101 122 (149) (166) Finance costs (473) (543) (300) - Preference shares provision (300) - 13 (13) Pensions and similar 34 (40) obligations ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 17 13 Share in net profit/(loss) of 51 32 joint ventures (2) 2 Share in net profit/(loss) of 4 (6) associates 15 3 Other income from non-current 26 24 ------ ------ investments ------ ------ 1 128 1 411 (20)% (19)% Profit before taxation 3 789 3 651 4% 2% (349) (414) Taxation (1 002) (1 005) ------ ------ ------ ------ 779 997 (22)% (21)% Net profit from continuing 2 787 2 646 5% 4% operations 33 477 Net profit/(loss) from 128 593 ------ ------ discontinued operations ------ ------ 812 1 474 (45)% (45)% Net profit for the period 2 915 3 239 (10)% (11)% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Attributable to: 75 57 Minority interests 202 157 737 1 417 (48)% (48)% Shareholders' equity 2 713 3 082 (12)% (13)%------ ------ ------ ------ -------------------- ------ ------ ------ ------ ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Combined earnings per share 0.25 0.49 (47)% (47)% Total operations (Euros) 0.94 1.06 (11)% (12)% 0.24 0.47 (47)% (47)% Total operations - diluted 0.91 1.02 (11)% (12)% (Euros) 0.25 0.32 (24)% (24)% Continuing operations (Euros) 0.90 0.85 5% 4% 0.24 0.32 (24)% (24)% Continuing operations - 0.87 0.83 5% 4% diluted (Euros) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ STATEMENT OF RECOGNISED INCOME AND EXPENSE(unaudited)• million Nine Months --------------- 2006 2005 Fair value gains/(losses) on financial instruments net of tax (551) 21 Actuarial gains/(losses) on pension schemes net of tax 6 14 Currency retranslation gains/(losses) net of tax 323 359 --------- --------- Net income/(expense) recognised directly in equity (222) 394 Net profit for the period 2 915 3 239 --------- --------- Total recognised income and expense for the period 2 693 3 633 ----------------------------------------- --------- --------- Attributable to: Minority interests 182 200 Shareholders' equity 2 511 3 433 ----------------------------------------- --------- --------- MOVEMENTS IN EQUITY (unaudited)• million Nine Months --------------- 2006 2005 Equity at 1 January 8 765 6 515 Total recognised income and expense for the period 2 693 3 633 Dividends (1 268) (1 229)Conversion of preference shares - 930 (Purchase)/sale of treasury stock 2 (600) Share option credit 92 124 Dividends paid to minority shareholders (170) (166) Currency retranslation gains/(losses) net of tax (8) 15 Other movements in equity 10 - --------- --------- Equity at the end of the period 10 116 9 222 BALANCE SHEET(unaudited)• million As at As at As at 30 31 1 September December October 2006 2005 2005 --------- --------- --------- Non-current assets -------------------- Goodwill and intangible assets 17 527 18 055 17 959 Property, plant and equipment 6 198 6 492 6 513 Pension asset for funded schemes in surplus 1 128 1 036 749 Deferred tax assets 1 373 1 703 1 520 Other non-current assets 1 099 1 072 1 207 --------- --------- --------- Total non-current assets 27 325 28 358 27 948 Assets held for sale 509 217 133 Current assets ---------------- Inventories 3 930 4 107 4 319 Trade and other current receivables 4 657 4 830 5 082 Other financial assets 320 335 356 Cash and cash equivalents 1 440 1 529 2 061 --------- --------- --------- Total current assets 10 347 10 801 11 818 Current liabilities --------------------- Borrowings due within one year (5 735) (5 942) (6 101)Trade payables and other current liabilities (7 909) (8 658) (8 400)Restructuring and other provisions (780) (644) (658) --------- --------- --------- Total current liabilities (14 424) (15 244) (15 159) --------- --------- --------- Net current assets/(liabilities) (4 077) (4 443) (3 341) --------- --------- ---------Total assets less current liabilities 23 757 24 132 24 740 Non-current liabilities ------------------------- Borrowings due after one year 5 025 6 457 6 823 Pension liability for funded schemes in deficit 2 051 2 415 2 396 Pension liability for unfunded schemes 3 992 4 202 3 993 Restructuring and other provisions 788 732 706 Deferred tax liabilities 931 933 807 Other non-current liabilities 617 602 779 --------- --------- ---------Total non-current liabilities 13 404 15 341 15 504 Liabilities held for sale 237 26 14 Equity -------- Shareholders' equity 9 704 8 361 8 813 Minority interests 412 404 409 --------- --------- ---------Total equity 10 116 8 765 9 222 --------- --------- --------- Total capital employed 23 757 24 132 24 740 CASH FLOW STATEMENT(unaudited)• million Nine Months --------------- 2006 2005 Operating activities ---------------------- Cash flow from operating activities 3 830 4 009 Income tax paid (718) (1 205) --------- ---------Net cash flow from operating activities 3 112 2 804 Investing activities ---------------------- Interest received 79 156 Net capital expenditure (660) (509) Acquisitions and disposals 182 740 Other investing activities 55 354 --------- ---------Net cash flow from/(used in) investing activities (344) 741 Financing activities ---------------------- Dividends paid on ordinary share capital (1 337) (1 229)Interest and preference dividends paid (400) (472) Change in borrowings and finance leases (1 205) (333) Purchase of treasury stock (5) (800) Other financing activities (178) (165) --------- ---------Net cash flow from/(used in) financing activities (3 125) (2 999) --------- ---------Net increase/(decrease) in cash and cash equivalents (357) 546 Cash and cash equivalents at the beginning of the year 1 265 1 406 Effect of foreign exchange rate changes 317 (142) --------- ---------Cash and cash equivalents at the end of period 1 225 1 810 ANALYSIS OF NET DEBT(unaudited)• million As at As at 30 31 September December 2006 2005 --------- --------- Total borrowings (10 760) (12 399) --------- ---------Borrowings due within one year (5 735) (5 942)Borrowings due after one year (5 025) (6 457) --------- ---------Cash and cash equivalents as per balance sheet 1 440 1 529 --------- --------- Cash and cash equivalents as per cash flow statement 1 225 1 265 Add bank overdrafts deducted therein 215 265 Less cash and cash equivalents in assets/liabilities held for - (1) sale --------- ---------Other financial assets 320 335 Derivatives and finance leases included in other receivables and (165) 33 other liabilities --------- ---------Net debt (9 165) (10 502) GEOGRAPHICAL ANALYSIS(unaudited) Continuing operations - Third Quarter• million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 3 805 3 409 2 721 9 935 2006 3 905 3 435 2 782 10 122 Change 2.6% 0.7% 2.3% 1.9% Impact of: Exchange rates 0.1% (2.7)% (4.1)% (2.0)%Acquisitions 0.0% 0.2% 0.0% 0.1% Disposals (0.9)% (0.8)% (0.8)% (0.8)%Underlying sales growth 3.5% 4.1% 7.5% 4.8% ---------------------- -------- -------- -------- --------Price 0.3% 1.3% 2.3% 1.2% Volume 3.1% 2.7% 5.0% 3.5% ---------------------- -------- -------- -------- -------- Operating profit 2005 653 526 372 1 551 2006 591 547 363 1 501 Change current rates (9.4)% 3.9% (2.3)% (3.2)%Change constant rates (9.3)% 5.2% 1.9% (1.8)% Operating margin 2005 17.2% 15.4% 13.7% 15.6% 2006 15.1% 15.9% 13.1% 14.8% Includes restructuring, business disposals and impairments 2005 (0.9)% (0.6)% (0.7)% (0.7)%2006 (1.1)% (0.7)% (0.5)% (0.8)% Continuing operations - Nine Months• million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 11 322 9 658 7 664 28 644 2006 11 385 10 331 8 199 29 915 Change 0.6% 7.0% 7.0% 4.4% Impact of: Exchange rates 0.1% 3.9% 0.0% 1.4% Acquisitions 0.0% 0.1% 0.0% 0.0% Disposals (1.0)% (0.6)% (1.0)% (0.9)%Underlying sales growth 1.4% 3.5% 8.0% 3.9% ---------------------- -------- -------- -------- --------Price (0.1)% 1.4% 1.6% 0.9% Volume 1.5% 2.1% 6.3% 3.0% ---------------------- -------- -------- -------- -------- Operating profit 2005 1 906 1 132 1 024 4 062 2006 1 712 1 603 1 031 4 346 Change current rates (10.1)% 41.5% 0.7% 7.0% Change constant rates (10.2)% 35.8% 0.5% 5.5% Operating margin 2005 16.8% 11.7% 13.4% 14.2% 2006 15.0% 15.5% 12.6% 14.5% Includes restructuring, business disposals and impairments 2005 0.0% (4.0)% 0.1% (1.3)%2006 (0.6)% (0.2)% 0.1% (0.3)% Operating profit of discontinued operations - Third Quarter• million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 43 - - 43 2006 43 - - 43 Operating profit of discontinued operations - Nine Months• million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 192 20 - 212 2006 182 - - 182 PRODUCT AREA ANALYSIS(unaudited) Continuing operations - Third Quarter• million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 3 322 2 082 5 404 2 760 1 771 4 531 9 935 2006 3 321 2 170 5 491 2 870 1 761 4 631 10 122 Change 0.0% 4.2% 1.6% 4.0% (0.6)% 2.2% 1.9% Impact of: Exchange rates (1.8)% (2.0)% (1.9)% (1.9)% (2.7)% (2.2)% (2.0)%Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1% Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8% growth Operating profit 2005 501 393 894 493 164 657 1 551 2006 457 393 850 492 159 651 1 501 Change current rates (8.8)% (0.2)% (5.0)% 0.0% (2.9)% (0.7)% (3.2)%Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%rates Operating margin 2005 15.1% 18.9% 16.6% 17.9% 9.2% 14.5% 15.6% 2006 13.8% 18.1% 15.5% 17.2% 9.0% 14.1% 14.8% -------- -------- Continuing operations - Nine Months• million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 9 825 5 871 15 696 7 733 5 215 12 948 28 644 2006 10 058 6 162 16 220 8 336 5 359 13 695 29 915 Change 2.4% 4.9% 3.3% 7.8% 2.8% 5.8% 4.4% Impact of: Exchange rates 1.1% 1.1% 1.1% 1.9% 1.4% 1.7% 1.4% Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0% Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9% growth Operating profit 2005 1 588 589 2 177 1 346 539 1 885 4 062 2006 1 494 937 2 431 1 442 473 1 915 4 346 Change current rates (5.9)% 59.1% 11.7% 7.2% (12.2)% 1.6% 7.0% Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5% rates Operating margin 2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2% 2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5% -------- -------- NOTES (unaudited) Basis of Preparation The condensed interim financial statements have been prepared in accordance withInternational Financial Reporting Standards (IFRS) as adopted by the EU. Theseare the same accounting policies as those used for preparation of the AnnualReport and Accounts for the year ended 31 December 2005. The condensed interim financial statements, which comply with IAS 34, are shownat current exchange rates, while percentage year-on-year changes are shown atboth current and constant exchange rates to facilitate comparison. Discontinued operations On 28 August 2006 Unilever announced that it had reached an agreement to sellthe majority of its European Frozen Foods business to the Permira Funds for €1.7billion. The deal is expected to be completed during the fourth quarter. TheUnilever businesses being sold in this transaction include the frozen foodsoperations in Austria, Belgium, France, Germany, Ireland, the Netherlands,Portugal and the United Kingdom. The sale is expected to result in a one-offprofit, after tax, in excess of €1 billion, which will be reported under theheading of discontinued operations. The net cash flows attributable to the discontinued operations in respect ofoperating, investing and financing activities for the first nine months were €83million, €13 million and •(1) million respectively (2005:•(9) million, €633 million and •(4) million). Earnings per share fordiscontinued operations are given on page 13. Taxation The charge for the year to date includes €95 million (2005: €118 million)relating to United Kingdom taxation. Exchange rate conventions The income statement on page 5, the statement of recognised income and expenseand the movements in equity on page 6 and the cash flow statement on page 8 aretranslated at rates current in each period. The balance sheet on page 7 and the analysis of net debt on page 8 aretranslated at period-end rates of exchange. Supplementary information in US dollars and sterling is available on our websiteat www.unilever.com/ourcompany/investorcentre. The financial statements attached do not constitute the full financialstatements within the meaning of Section 240 of the UK Companies Act 1985. Fullaccounts for Unilever for the year ended 31 December 2005 have been delivered tothe Registrar of Companies. The auditors' report on these accounts wasunqualified and did not contain a statement under Section 237(2) or Section 237(3) of the UK Companies Act 1985. INTERIM AND ONE-OFF DIVIDENDS The dividend information given below, including the comparative amounts for2005, is expressed in terms of the nominal share values which have applied since22 May 2006 following the split of NV shares and the consolidation of PLC shareswhich were approved at the 2006 AGMs. The actual interim dividends paid inrespect of shares under the earlier denominations are also given below. The Boards have declared interim and one-off dividends in respect of 2006 on theordinary shares at the following rates which are equivalent in value at the rateof exchange applied under the terms of the Equalisation Agreement between thetwo companies: Unilever N.V. 2005 2006Interim dividend €0.22 €0.23One-off dividend €0.26 €0.49Unilever PLC 2005 2006Interim dividend 15.04p 15.62pOne-off dividend 17.66p 33.28p The NV dividends will be payable as from 4 December 2006, to shareholders registered at close of business on 2 November 2006. The PLC dividends will be paid on 4 December 2006, to shareholders registered atclose of business on 10 November 2006. Dividend on New York shares of NV The NV interim and one-off dividends, when converted at the Euro/Dollar EuropeanCentral Bank rate of exchange on 1 November 2006, represent the followingamounts per New York Share of €0.16 before deduction of Netherlands withholdingtax. 2005 2006Interim dividend $0.2638 $0.2934One-off dividend $0.3316 $0.6250 The New York shares of NV will go ex-dividend on 3 November 2006; US dollarchecks for the combined interim and one-off dividends, after deduction ofNetherlands withholding tax at the appropriate rate, will be mailed on 1December 2006, to holders of record of New York shares at the close of businesson 7 November 2006. The dividend will be payable on 4 December 2006. Dividend on American Depositary Receipts of PLC Each American Depositary Receipt of PLC represents one 3 1/9p ordinary share ofPLC. When converted at the Bank of England Sterling/Dollar rate of exchange on1 November 2006, the interim and one-off dividends for holders resident in theUS will therefore be as follows: 2005 2006Interim dividend $0.2655 $0.2983One-off dividend $0.3372 $0.6355 The American Depositary Receipts of PLC will go ex-dividend on 8 November 2006;US dollar checks for the combined interim and one-off dividends will be mailedon 1 December 2006 to holders of record of American Depositary Receipts at theclose of business on 10 November 2006. The dividend will be payable on 4December 2006. Interim dividends paid in 2005 The actual interim dividends paid in 2005 were as follows: €0.66 per €0.51 ordinary share of NV;6.77p per 1.4p ordinary share of PLC;US $0.791472 per €0.51 New York share of NV; andUS $0.4779 per 5.6p ADR of PLC. Dividend reinvestment plans It should be noted that the one-off dividend will automatically be re-investedalong with the interim dividend for shareholders participating in the variousUnilever dividend reinvestment plans (DRIP). If those shareholders would prefer to receive the one-off and interim dividendsas cash they will need to withdraw from the DRIP for this dividend. Shareholderswill then need to re-join the DRIP after the receipt of the cash dividend ifthey wish for their future dividends to be re-invested. The last date on which achange of election must be received by the administrators of each DRIP plan isas follows: Unilever N.V. 21 November 2006Unilever PLC 13 November 2006Unilever N.V. New York shares 6 November 2006Unilever PLC ADRs 9 November 2006 For further information and queries on your participation we advise you tocontact your bank, broker or DRIP Administrator. EARNINGS PER SHARE(unaudited) Combined earnings per share The combined earnings per share calculations are based on the average number ofshare units representing the combined ordinary shares of NV and PLC in issueduring the period, less the average number of shares held as treasury stock. In calculating diluted earnings per share, a number of adjustments are made tothe number of shares, principally the following: (i) conversion into PLCordinary shares in the year 2038 of shares in a group company under thearrangements for the variation of the Leverhulme Trust; (ii) conversion of the€0.05 NV preference shares (up to the point of conversion); and (iii) theexercise of share options by employees. Earnings per share attributable todiscontinued operations were as follows: 2006 2005 Third Quarter:Basic EPS • 0.00 • 0.17Diluted EPS • 0.00 • 0.15 Nine Months:Basic EPS • 0.04 • 0.21Diluted EPS • 0.04 • 0.19 Earnings per share for total operations for the nine months 2006 2005 --------- --------- Combined EPS Thousands of units --------------- Average number of combined share units 2 882 122 2 920 224 • million --------- --------- Net profit attributable to shareholders' equity 2 713 3 082 --------- ---------Combined EPS (Euros) 0.94 1.06 --------- --------- Combined EPS - Diluted Thousands of units --------------- Adjusted average number of combined share units 2 968 519 3 015 309 • million --------------- Adjusted net profit attributable to shareholders' equity 2 713 3 085 --------- ---------Combined EPS - diluted (Euros) 0.91 1.02 --------- --------- Earnings per share in US Dollars and Sterling --------- ---------Combined EPS (Dollars) 1.17 1.33 Combined EPS - diluted (Dollars) 1.14 1.29 --------- --------- --------- ---------Combined EPS (Pounds) 0.64 0.72 Combined EPS - diluted (Pounds) 0.63 0.70 --------- --------- DATES The results for the fourth quarter and for the year 2006 will be published on8 February 2007. ENQUIRIES: UNILEVER PRESS OFFICE+44 (0) 20 7822 6805/6010Internet: www.unilever.comE-mail: [email protected] 2 November 2006 US DOLLAR SUPPLEMENT TO THE UNILEVER THIRD QUARTER AND NINE MONTHS RESULTS 2006AND INTERIM DIVIDENDS This document is a supplement to the Unilever third quarter and nine Monthsresults 2006 and is prepared for reference purposes only, Unilever's reportingcurrency is the Euro. The income statement, statement of recognised income andexpense, movements in equity and cash flow statement are translated at ratescurrent in each period. These rates were €1 = US $1.24 for the first nine monthsof 2006 and €1 = US $1.26 for the first nine months of 2005. The balance sheetis translated at period-end rates of exchange. These were €1 = US $1.27 at30 September 2006, €1 = US $1.18 at 31 December 2005 and €1 = US $1.20 at1 October 2005. Certain items in the income statement and statement ofrecognised income and expense, notably currency retranslation recognised on thedisposal of businesses, will not reflect the result which would arise if thereporting currency were to be US dollar. INCOME STATEMENT (unaudited) Third Quarter US $ million Nine Months ------------------- --------------------------------- 2006 2005 Increase/ 2006 2005 Increase/ (Decrease) (Decrease) Current Constant Current Constant rates rates rates rates Continuing operations: 12 869 12 125 6% 4% Turnover 37 214 36 091 3% 3% 1 907 1 902 0% (2)% Operating profit 5 407 5 118 6% 5% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ After (charging)/crediting: (94) (101) Restructuring (292) (164) (3) 18 Business disposals and 188 (309) impairments ------ ------ ------ ------ -------------------- ------ ------ ------ ------ (505) (193) Net finance costs (794) (581) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 43 25 Finance income 126 154 (191) (202) Finance costs (589) (684) (374) - Preference shares provision (374) - 17 (16) Pensions and similar 43 (51) obligations ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 21 17 Share in net profit/(loss) of 64 41 joint ventures (3) 2 Share in net profit/(loss) of 4 (8) associates 21 4 Other income from non-current 34 31 ------ ------ investments ------ ------ 1 441 1 732 (17)% (19)% Profit before taxation 4 715 4 601 2% 2% (444) (509) Taxation (1 247) (1 266) ------ ------ ------ ------ 997 1 223 (18)% (21)% Net profit from continuing 3 468 3 335 4% 4% operations 42 598 Net profit/(loss) from 159 747 ------ ------ discontinued operations ------ ------ 1 039 1 821 (43)% (45)% Net profit for the period 3 627 4 082 (11)% (11)% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Attributable to: 96 71 Minority interests 252 199 943 1 750 (46)% (48)% Shareholders' equity 3 375 3 883 (13)% (13)%------ ------ ------ ------ -------------------- ------ ------ ------ ------ ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Combined earnings per share $0.33 $0.60 (45)% (47)% Total operations (Dollars) $1.17 $1.33 (12)% (12)%$0.32 $0.58 (45)% (47)% Total operations - diluted $1.14 $1.29 (12)% (12)% (Dollars) $0.32 $0.39 (21)% (24)% Continuing operations $1.12 $1.07 4% 4% (Dollars) $0.30 $0.38 (21)% (24)% Continuing operations - $1.08 $1.04 4% 4% diluted (Dollars) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ STATEMENT OF RECOGNISED INCOME AND EXPENSE(unaudited)US $ million Nine Months --------------- 2006 2005 Fair value gains/(losses) on financial instruments net of tax (685) 26 Actuarial gains/(losses) on pension schemes net of tax 7 18 Currency retranslation gains/(losses) net of tax 1 096 (642) --------- --------- Net income/(expense) recognised directly in equity 418 (598) Net profit for the period 3 626 4 082 --------- --------- Total recognised income and expense for the period 4 044 3 484 ----------------------------------------- --------- ---------Attributable to: Minority interests 252 209 Shareholders' equity 3 792 3 275 ----------------------------------------- --------- --------- MOVEMENTS IN EQUITY(unaudited)US $ million Nine Months --------------- 2006 2005 Equity at 1 January 10 378 8 899 Total recognised income and expense for the period 4 044 3 484 Dividends (1 577) (1 549)Conversion of preference shares - 1 172 (Purchase)/sale of treasury stock 2 (756) Share option credit 114 156 Dividends paid to minority shareholders (211) (209) Currency retranslation gains/(losses) net of tax 55 (112) Other movements in equity 12 - --------- --------- Equity at the end of the period 12 817 11 085 BALANCE SHEET(unaudited)US $ million As at As at As at 30 31 1 September December October 2006 2005 2005 --------- --------- --------- Non-current assets -------------------- Goodwill and intangible assets 22 207 21 376 21 587 Property, plant and equipment 7 853 7 686 7 828 Pension asset for funded schemes in surplus 1 429 1 226 901 Deferred tax assets 1 739 2 017 1 827 Other non-current assets 1 393 1 269 1 451 --------- --------- --------- Total non-current assets 34 621 33 574 33 594 Assets held for sale 645 258 159 Current assets ---------------- Inventories 4 979 4 863 5 190 Trade and other current receivables 5 901 5 719 6 109 Other financial assets 405 396 428 Cash and cash equivalents 1 824 1 811 2 478 --------- --------- --------- Total current assets 13 109 12 789 14 205 Current liabilities --------------------- Borrowings due within one year (7 266) (7 036) (7 333)Trade payables and other current liabilities (10 020) (10 251) (10 097)Restructuring and other provisions (989) (762) (791) --------- --------- ---------Total current liabilities (18 275) (18 049) (18 221) --------- --------- ---------Net current assets/(liabilities) (5 166) (5 260) (4 016) --------- --------- ---------Total assets less current liabilities 30 100 28 572 29 737 Non-current liabilities ------------------------- Borrowings due after one year 6 367 7 645 8 201 Pension liability for funded schemes in deficit 2 599 2 859 2 814 Pension liability for unfunded schemes 5 058 4 975 4 866 Restructuring and other provisions 998 866 849 Deferred tax liabilities 1 178 1 105 970 Other non-current liabilities 783 713 936 --------- --------- ---------Total non-current liabilities 16 983 18 163 18 636 Liabilities held for sale 300 31 16 Equity -------- Shareholders' equity 12 296 9 900 10 594 Minority interests 521 478 491 --------- --------- ---------Total equity 12 817 10 378 11 085 --------- --------- --------- Total capital employed 30 100 28 572 29 737 CASH FLOW STATEMENT(unaudited)US $ million Nine Months --------------- 2006 2005 Operating activities ---------------------- Cash flow from operating activities 4 765 5 052 Income tax paid (893) (1 519) --------- ---------Net cash flow from operating activities 3 872 3 533 Investing activities ---------------------- Interest received 98 197 Net capital expenditure (821) (642) Acquisitions and disposals 226 933 Other investing activities 68 446 --------- ---------Net cash flow from/(used in) investing activities (429) 934 Financing activities ---------------------- Dividends paid on ordinary share capital (1 664) (1 549)Interest and preference dividends paid (497) (595) Change in borrowings and finance leases (1 499) (419) Purchase of treasury stock (6) (1 008)Other financing activities (221) (208) --------- ---------Net cash flow from/(used in) financing activities (3 887) (3 779) --------- ---------Net increase/(decrease) in cash and cash equivalents (444) 688 Cash and cash equivalents at the beginning of the year 1 498 1 921 Effect of foreign exchange rate changes 497 (433) --------- --------- Cash and cash equivalents at the end of period 1 551 2 176 ANALYSIS OF NET DEBT(unaudited)US $ million As at As at 30 31 September December 2006 2005 --------- --------- Total borrowings (13 633) (14 681) --------- ---------Borrowings due within one year (7 266) (7 036)Borrowings due after one year (6 367) (7 645) --------- ---------Cash and cash equivalents as per balance sheet 1 824 1 811 --------- --------- Cash and cash equivalents as per cash flow statement 1 551 1 498 Add bank overdrafts deducted therein 273 314 Less cash and cash equivalents in assets/liabilities held for - (1) sale --------- ---------Other financial assets 405 396 Derivatives and finance leases included in other receivables and (209) 39 other liabilities --------- ---------Net debt (11 613) (12 435) GEOGRAPHICAL ANALYSIS(unaudited) Continuing operations - Third QuarterUS $ million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 4 635 4 166 3 324 12 125 2006 4 962 4 370 3 537 12 869 Change 7.0% 4.9% 6.4% 6.1% Impact of: Exchange rates 4.3% 1.4% (0.2)% 2.0% Acquisitions 0.0% 0.2% 0.0% 0.1% Disposals (0.9)% (0.8)% (0.8)% (0.8)%Underlying sales growth 3.5% 4.1% 7.5% 4.8% ---------------------- -------- -------- -------- --------Price 0.3% 1.3% 2.3% 1.2% Volume 3.1% 2.7% 5.0% 3.5% ---------------------- -------- -------- -------- -------- Operating profit 2005 797 651 454 1 902 2006 751 695 461 1 907 Change current rates (5.6)% 6.8% 1.5% 0.3% Change constant rates (9.3)% 5.2% 1.9% (1.8)% Operating margin 2005 17.2% 15.6% 13.7% 15.7% 2006 15.1% 15.9% 13.0% 14.8% Includes restructuring, business disposals and impairments 2005 (0.9)% (0.6)% (0.7)% (0.7)%2006 (1.1)% (0.7)% (0.5)% (0.8)% Continuing operations - Nine MonthsUS $ million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 14 265 12 170 9 656 36 091 2006 14 163 12 851 10 200 37 214 Change (0.7)% 5.6% 5.6% 3.1% Impact of: Exchange rates (1.1)% 2.5% (1.2)% 0.1% Acquisitions 0.0% 0.1% 0.0% 0.0% Disposals (1.0)% (0.6)% (1.0)% (0.9)%Underlying sales growth 1.4% 3.5% 8.0% 3.9% ---------------------- -------- -------- -------- --------Price (0.1)% 1.4% 1.6% 0.9% Volume 1.5% 2.1% 6.3% 3.0% ---------------------- -------- -------- -------- -------- Operating profit 2005 2 401 1 427 1 290 5 118 2006 2 130 1 995 1 282 5 407 Change current rates (11.2)% 39.8% (0.6)% 5.7% Change constant rates (10.2)% 35.8% 0.5% 5.5% Operating margin 2005 16.8% 11.7% 13.4% 14.2% 2006 15.0% 15.5% 12.6% 14.5% Includes restructuring, business disposals and impairments 2005 0.0% (4.0)% 0.1% (1.3)%2006 (0.6)% (0.2)% 0.1% (0.3)% Operating profit of discontinued operations - Third QuarterUS $ million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 52 (1) - 51 2006 55 - - 55 Operating profit of discontinued operations - Nine MonthsUS $ million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 242 25 - 267 2006 226 - - 226 PRODUCT AREA ANALYSIS(unaudited) Continuing operations - Third QuarterUS $ million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 4 048 2 544 6 592 3 374 2 159 5 533 12 125 2006 4 226 2 755 6 981 3 647 2 241 5 888 12 869 Change 4.4% 8.3% 5.9% 8.1% 3.8% 6.4% 6.1% Impact of: Exchange rates 2.5% 1.8% 2.3% 1.9% 1.6% 1.8% 2.0% Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1% Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8% growth Operating profit 2005 609 491 1 100 604 198 802 1 902 2006 583 496 1 079 627 201 828 1 907 Change current rates (4.2)% 0.9% (1.9)% 3.9% 2.0% 3.4% 0.3% Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%rates Operating margin 2005 15.0% 19.3% 16.7% 17.9% 9.2% 14.5% 15.7% 2006 13.8% 18.0% 15.5% 17.2% 9.0% 14.1% 14.8% -------- -------- Continuing operations - Nine MonthsUS $ million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 12 378 7 398 19 776 9 744 6 571 16 315 36 091 2006 12 513 7 664 20 177 10 370 6 667 17 037 37 214 Change 1.1% 3.6% 2.0% 6.4% 1.5% 4.4% 3.1% Impact of: Exchange rates (0.2)% (0.2)% (0.2)% 0.6% 0.1% 0.3% 0.1% Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0% Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9% growth Operating profit 2005 2 001 742 2 743 1 696 679 2 375 5 118 2006 1 858 1 166 3 024 1 795 588 2 383 5 407 Change current rates (7.1)% 57.1% 10.2% 5.8% (13.4)% 0.3% 5.7% Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5% rates Operating margin 2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2% 2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5% -------- -------- EARNINGS PER SHARE FOR TOTAL OPERATIONS IN US DOLLARS FOR THE NINE MONTHS 2006 2005 -------- --------- Combined EPS Thousands of units ---------------- Average number of combined share units 2 882 122 2 920 224 US $ million ---------------- Net profit attributable to shareholders' equity 3 375 3 883 -------- ---------Combined EPS (Dollars) 1.17 1.33 -------- --------- Combined EPS - Diluted Thousands of units --------------- Adjusted average number of combined share units 2 968 519 3 015 309 US $ million ---------------- Adjusted net profit attributable to shareholders' equity 3 375 3 887 -------- ---------Combined EPS - diluted (Dollars) 1.14 1.29 -------- --------- STERLING SUPPLEMENT TO THE UNILEVER THIRD QUARTER AND NINE MONTHS RESULTS 2006 AND INTERIM DIVIDENDS This document is a supplement to the Unilever third quarter and Nine Monthsresults 2006 and is prepared for reference purposes only, Unilever's reportingcurrency is the Euro. The income statement, statement of recognised income andexpense, movement in equity and cash flow statement are translated at ratescurrent in each period. These rates were €1 = £0.68 for the first nine months of2006 and €1 = £0.68 for the first nine months of 2005. The balance sheet istranslated at period-end rates of exchange. These were €1 = £0.68 at30 September 2006, €1 = £0.69 at 31 December 2005 and €1 = £0.68 at1 October 2005. Certain items in the income statement and statement ofrecognised income and expense, notably currency retranslation recognised on thedisposal of businesses, will not reflect the result which would arise if thereporting currency were to be sterling. INCOME STATEMENT (unaudited) Third Quarter £ million Nine Months ------------------- ------------------- 2006 2005 Increase/ 2006 2005 Increase/ (Decrease) (Decrease) Current Constant Current Constant rates rates rates rates Continuing operations: 6 875 6 788 1% 4% Turnover 20 471 19 615 4% 3% 1 020 1 059 (4)% (2)% Operating profit 2 974 2 781 7% 5% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ After (charging)/crediting: (60) (55) Restructuring (161) (89) (3) 7 Business disposals and 103 (168) impairments ------ ------ ------ ------ -------------------- ------ ------ ------ ------ (274) (108) Net finance costs (435) (316) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 22 15 Finance income 69 84 (101) (114) Finance costs (323) (372) (204) - Preference shares provision (204) - 9 (9) Pensions and similar 23 (28) obligations ------ ------ ------ ------ -------------------- ------ ------ ------ ------ 11 9 Share in net profit/(loss) of 35 22 joint ventures (1) 2 Share in net profit/(loss) of 3 (4) associates 10 3 Other income from non-current 17 17 ------ ------ investments ------ ------ 766 965 (21)% (19)% Profit before taxation 2 594 2 500 4% 2% (237) (283) Taxation (686) (688) ------ ------ ------ ------ 529 682 (23)% (21)% Net profit from continuing 1 908 1 812 5% 4% operations 21 327 Net profit/(loss) from 87 406 ------ ------ discontinued operations ------ ------ 550 1 009 (45)% (45)% Net profit for the period 1 995 2 218 (10)% (11)% ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Attributable to: 51 40 Minority interests 138 108 499 969 (48)% (48)% Shareholders' equity 1 857 2 110 (12)% (13)%------ ------ ------ ------ -------------------- ------ ------ ------ ------ ------ ------ ------ ------ -------------------- ------ ------ ------ ------ Combined earnings per share 0.17 0.33 (48)% (47)% Total operations (Pounds) 0.64 0.72 (11)% (12)% 0.17 0.32 (48)% (47)% Total operations - diluted 0.63 0.70 (11)% (12)% (Pounds) 0.16 0.22 (25)% (24)% Continuing operations 0.61 0.58 5% 4% (Pounds) 0.16 0.22 (25)% (24)% Continuing operations - 0.60 0.57 5% 4% diluted (Pounds) ------ ------ ------ ------ -------------------- ------ ------ ------ ------ STATEMENT OF RECOGNISED INCOME AND EXPENSE(unaudited)£ million Nine Months --------------- 2006 2005 Fair value gains/(losses) on financial instruments net of tax (377) 14 Actuarial gains/(losses) on pension schemes net of tax 4 10 Currency retranslation gains/(losses) net of tax 142 107 --------- --------- Net income/(expense) recognised directly in equity (231) 131 Net profit for the period 1 995 2 218 --------- --------- Total recognised income and expense for the period 1 764 2 349 ----------------------------------------- --------- ---------Attributable to: Minority interests 140 132 Shareholders' equity 1 624 2 217 ----------------------------------------- --------- --------- MOVEMENTS IN EQUITY(unaudited)£ million Nine Months --------------- 2006 2005 Equity at 1 January 6 016 4 605 Total recognised income and expense for the period 1 764 2 349 Dividends (868) (842) Conversion of preference shares - 637 (Purchase)/sale of treasury stock 1 (411) Share option credit 63 85 Dividends paid to minority shareholders (116) (114) Currency retranslation gains/(losses) net of tax (13) (8) Other movements in equity 7 - --------- --------- Equity at the end of the period 6 854 6 301 BALANCE SHEET(unaudited)£ million As at As at As at 30 31 1 September December October 2006 2005 2005 --------- --------- --------- Non-current assets -------------------- Goodwill and intangible assets 11 874 12 393 12 270 Property, plant and equipment 4 199 4 456 4 450 Pension asset for funded schemes in surplus 764 711 512 Deferred tax assets 931 1 169 1 038 Other non-current assets 745 735 824 --------- --------- ---------Total non-current assets 18 513 19 464 19 094 Assets held for sale 345 149 91 Current assets ---------------- Inventories 2 662 2 819 2 951 Trade and other current receivables 3 155 3 315 3 472 Other financial assets 217 230 243 Cash and cash equivalents 976 1 050 1 408 --------- --------- --------- Total current assets 7 010 7 414 8 074 Current liabilities --------------------- Borrowings due within one year (3 886) (4 079) (4 168)Trade payables and other current liabilities (5 358) (5 942) (5 736)Restructuring and other provisions (528) (442) (450) --------- --------- ---------Total current liabilities (9 772) (10 463) (10 354) --------- --------- ---------Net current assets/(liabilities) (2 762) (3 049) (2 280) --------- --------- ---------Total assets less current liabilities 16 096 16 564 16 905 Non-current liabilities ------------------------- Borrowings due after one year 3 404 4 432 4 662 Pension liability for funded schemes in deficit 1 390 1 658 1 600 Pension liability for unfunded schemes 2 705 2 884 2 760 Restructuring and other provisions 534 502 482 Deferred tax liabilities 631 641 551 Other non-current liabilities 418 413 540 --------- --------- ---------Total non-current liabilities 9 082 10 530 10 595 Liabilities held for sale 160 18 9 Equity -------- Shareholders' equity 6 576 5 739 6 021 Minority interests 278 277 280 --------- --------- ---------Total equity 6 854 6 016 6 301 --------- --------- --------- Total capital employed 16 096 16 564 16 905 CASH FLOW STATEMENT(unaudited)£ million Nine Months --------------- 2006 2005 Operating activities ---------------------- Cash flow from operating activities 2 621 2 745 Income tax paid (491) (825) --------- ---------Net cash flow from operating activities 2 130 1 920 Investing activities ---------------------- Interest received 54 107 Net capital expenditure (452) (349) Acquisitions and disposals 124 507 Other investing activities 38 243 --------- ---------Net cash flow from/(used in) investing activities (236) 508 Financing activities ---------------------- Dividends paid on ordinary share capital (915) (842) Interest and preference dividends paid (273) (323) Change in borrowings and finance leases (825) (228) Purchase of treasury stock (3) (548) Other financing activities (122) (113) --------- ---------Net cash flow from/(used in) financing activities (2 138) (2 054) --------- ---------Net increase/(decrease) in cash and cash equivalents (244) 374 Cash and cash equivalents at the beginning of the year 868 994 Effect of foreign exchange rate changes 206 (131) --------- --------- Cash and cash equivalents at the end of period 830 1 237 ANALYSIS OF NET DEBT(unaudited)£ million As at As at 30 31 September December 2006 2005 --------- --------- Total borrowings (7 290) (8 511) --------- ---------Borrowings due within one year (3 886) (4 079)Borrowings due after one year (3 404) (4 432) --------- ---------Cash and cash equivalents as per balance sheet 976 1 050 --------- --------- Cash and cash equivalents as per cash flow statement 830 868 Add bank overdrafts deducted therein 146 183 Less cash and cash equivalents in assets/liabilities held for - (1) sale --------- ---------Other financial assets 217 230 Derivatives and finance leases included in other receivables and (112) 23 other liabilities --------- ---------Net debt (6 209) (7 208) GEOGRAPHICAL ANALYSIS(unaudited) Continuing operations - Third Quarter£ million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 2 599 2 330 1 859 6 788 2006 2 653 2 332 1 890 6 875 Change 2.0% 0.1% 1.7% 1.3% Impact of: Exchange rates (0.6)% (3.3)% (4.6)% (2.7)%Acquisitions 0.0% 0.2% 0.0% 0.1% Disposals (0.9)% (0.8)% (0.8)% (0.8)%Underlying sales growth 3.5% 4.1% 7.5% 4.8% ---------------------- -------- -------- -------- --------Price 0.3% 1.3% 2.3% 1.2% Volume 3.1% 2.7% 5.0% 3.5% ---------------------- -------- -------- -------- -------- Operating profit 2005 446 359 254 1 059 2006 402 371 247 1 020 Change current rates (9.9)% 3.2% (2.8)% (3.8)%Change constant rates (9.3)% 5.2% 1.9% (1.8)% Operating margin 2005 17.2% 15.4% 13.7% 15.6% 2006 15.1% 15.9% 13.1% 14.8% Includes restructuring, business disposals and impairments 2005 (0.9)% (0.6)% (0.7)% (0.7)%2006 (1.1)% (0.7)% (0.5)% (0.8)% Continuing operations - Nine Months£ million Europe Americas Asia Total Africa -------- -------- -------- -------- Turnover 2005 7 753 6 614 5 248 19 615 2006 7 791 7 069 5 611 20 471 Change 0.5% 6.9% 6.9% 4.4% Impact of: Exchange rates 0.1% 3.8% 0.0% 1.4% Acquisitions 0.0% 0.1% 0.0% 0.0% Disposals (1.0)% (0.6)% (1.0)% (0.9)%Underlying sales growth 1.4% 3.5% 8.0% 3.9% ---------------------- -------- -------- -------- --------Price (0.1)% 1.4% 1.6% 0.9% Volume 1.5% 2.1% 6.3% 3.0% ---------------------- -------- -------- -------- -------- Operating profit 2005 1 305 775 701 2 781 2006 1 172 1 096 706 2 974 Change current rates (10.2)% 41.4% 0.6% 6.9% Change constant rates (10.2)% 35.8% 0.5% 5.5% Operating margin 2005 16.8% 11.7% 13.4% 14.2% 2006 15.0% 15.5% 12.6% 14.5% Includes restructuring, business disposals and impairments 2005 0.0% (4.0)% 0.1% (1.3)%2006 (0.6)% (0.2)% 0.1% (0.3)% Operating profit of discontinued operations - Third Quarter£ million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 29 - - 29 2006 30 - - 30 Operating profit of discontinued operations - Nine Months£ million Europe Americas Asia Total Africa -------- -------- -------- -------- 2005 131 14 - 145 2006 125 - - 125 PRODUCT AREA ANALYSIS(unaudited) Continuing operations - Third Quarter£ million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 2 270 1 422 3 692 1 887 1 209 3 096 6 788 2006 2 256 1 474 3 730 1 950 1 195 3 145 6 875 Change (0.6)% 3.6% 1.0% 3.4% (1.2)% 1.6% 1.3% Impact of: Exchange rates (2.4)% (2.6)% (2.5)% (2.5)% (3.3)% (2.8)% (2.7)%Acquisitions 0.0% 0.1% 0.0% 0.3% 0.0% 0.2% 0.1% Disposals (1.2)% (0.2)% (0.8)% (1.0)% (0.5)% (0.8)% (0.8)%Underlying sales 3.1% 6.5% 4.4% 6.8% 2.7% 5.2% 4.8% growth Operating profit 2005 342 269 611 337 111 448 1 059 2006 310 267 577 335 108 443 1 020 Change current rates (9.4)% (0.8)% (5.6)% (0.6)% (3.4)% (1.3)% (3.8)%Change constant (6.9)% 0.1% (3.8)% 1.7% (0.7)% 1.1% (1.8)%rates Operating margin 2005 15.1% 18.9% 16.6% 17.9% 9.2% 14.5% 15.6% 2006 13.7% 18.1% 15.5% 17.2% 9.0% 14.1% 14.8% -------- -------- Continuing operations - Nine Months£ million Savoury, Ice cream Foods Personal Home care Home and Total dressings and care and Personal and beverages other Care spreads -------- -------- -------- -------- -------- -------- -------- Turnover 2005 6 728 4 020 10 748 5 296 3 571 8 867 19 615 2006 6 884 4 216 11 100 5 704 3 667 9 371 20 471 Change 2.3% 4.9% 3.3% 7.7% 2.7% 5.7% 4.4% Impact of: Exchange rates 1.0% 1.1% 1.1% 1.8% 1.3% 1.6% 1.4% Acquisitions 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.0% Disposals (1.4)% (0.3)% (1.0)% (0.8)% (0.5)% (0.7)% (0.9)%Underlying sales 2.7% 4.1% 3.2% 6.5% 1.9% 4.7% 3.9% growth Operating profit 2005 1 088 403 1 491 922 368 1 290 2 781 2006 1 023 641 1 664 987 323 1 310 2 974 Change current rates (6.0)% 59.0% 11.6% 7.1% (12.3)% 1.6% 6.9% Change constant (6.6)% 58.8% 11.0% 4.4% (14.3)% (0.9)% 5.5% rates Operating margin 2005 16.2% 10.0% 13.9% 17.4% 10.3% 14.6% 14.2% 2006 14.9% 15.2% 15.0% 17.3% 8.8% 14.0% 14.5% -------- -------- EARNINGS PER SHARE FOR TOTAL OPERATIONS IN STERLING FOR THE NINE MONTHS 2006 2005 --------- --------- Combined EPS Thousands of units --------------- Average number of combined share units 2 882 122 2 920 224 £ million --------------- Net profit attributable to shareholders' equity 1 857 2 110 --------- ---------Combined EPS (Pounds) 0.64 0.72 --------- --------- Combined EPS - Diluted Thousands of units --------------- Adjusted average number of combined share units 2 968 519 3 015 309 £ million --------------- Adjusted net profit attributable to shareholders' equity 1 857 2 112 --------- ---------Combined EPS - diluted (Pounds) 0.63 0.70 --------- --------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Unilever