Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of July, 2012.
Commission File Number 001-04547
UNILEVER N.V.
(Translation of registrants name into English)
WEENA 455, 3013 AL, P.O. BOX 760, 3000 DK, ROTTERDAM, THE NETHERLANDS
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of 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): ¨
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
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): ¨
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrants home country), or under the rules of the home country exchange on which the registrants securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrants security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
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- .
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/ T. E. Lovell |
By T. E. LOVELL, |
Group Secretary |
Date: 27 July 2012
2
2012 FIRST HALF YEAR RESULTS
CONSISTENT PERFORMANCE SUSTAINED DESPITE CHALLENGING MARKETS
First half highlights
| Turnover up 11.5% at 25.4 billion with a positive impact from foreign exchange of 1.9% and acquisitions net of disposals of 2.2%. |
| First half underlying sales growth 7.0% comprising volume growth of 2.8% and price growth of 4.1%. |
| Emerging markets underlying sales growth up 11.4% in the first half. |
| Core operating margin flat; increased advertising and promotions investment behind our brands. |
| Core earnings per share up 6% at 0.76; free cash flow at 1.5 billion. |
Paul Polman: Chief Executive Officer statement |
Solid and consistent first half results provide further evidence that we are making progress in the transformation of Unilever to a sustainable growth company.
Despite deteriorating global economic conditions and a competitive environment which remains intense, we again delivered volume growth ahead of our markets and gained value share across the majority of our business. Our performance reflects continued investment in innovation, brand-building and people, whilst keeping discipline on both costs and execution.
The Unilever Sustainable Living Plan is increasingly bearing fruit by accelerating innovation and helping us build stronger relationships with consumers, customers and communities, energising our people and reducing costs. It lies at the heart of our strategy to double the size of the business whilst reducing our overall environmental footprint.
We continue to prepare the ground for future growth. The first half saw the completion of the acquisition of Concern Kalina, Russias leading local personal care business, Tresemmé made excellent progress in Brazil and we launched Magnum in the Philippines, all evidence that we are further strengthening our position as the emerging markets consumer goods company. We are also investing in developed markets: during the first half we successfully launched Clear in the United States and Axe Hair in Europe.
Looking forward we expect continued volatility, especially in commodity costs and economic conditions. We remain focused on profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow, driven by increased capital discipline. For 2012 we remain on track to deliver a modest improvement in core operating margin.
Key Financials (unaudited) Current Rates |
First Half 2012 | |||||||||
Underlying Sales Growth (*) |
7.0% | |||||||||
Turnover |
| 25.4bn | +11.5 | % | ||||||
Operating Profit |
| 3.4bn | +4 | % | ||||||
Net Profit |
| 2.4bn | +1 | % | ||||||
Core earnings per share (*) |
| 0.76 | +6 | % | ||||||
Diluted earnings per share |
| 0.75 | -3 | % | ||||||
Quarterly dividend payable in September 2012 |
0.243 per share |
(*) | Underlying sales growth and core earnings per share are non-GAAP measures see note 2 on page 11. |
OPERATIONAL REVIEW: CATEGORIES
First Half 2012 | ||||||||||||||||||||
(unaudited) |
Turnover | USG | UVG | UPG | Change in core operating margin |
|||||||||||||||
bn | % | % | % | bps | ||||||||||||||||
Unilever Total |
25.4 | 7.0 | 2.8 | 4.1 | 0 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Personal Care |
8.7 | 10.4 | 6.7 | 3.5 | (140 | ) | ||||||||||||||
Foods |
7.1 | 3.2 | (1.0 | ) | 4.2 | 50 | ||||||||||||||
Home Care |
4.4 | 9.8 | 5.3 | 4.3 | 50 | |||||||||||||||
Refreshment |
5.2 | 4.9 | 0.3 | 4.5 | 70 |
The first half results reflect a strong performance in markets that remain challenging. Consumer confidence remains fragile and the competitive environment intense. The value growth of our markets is driven largely by pricing and reflects the combination of strong growth in emerging markets and sluggish growth in the developed markets where volume growth continues to be negative.
In this context, all of our Categories grew, driven by strong innovations and the roll-out of our brands into new markets. Emerging markets continued to deliver double digit underlying sales growth, reaching 11.4% over the first half year. Dove continues to grow strongly, with annual turnover now in excess of 3 billion whilst Magnum is well on track to become a 1 billion brand.
Higher commodity costs were partially offset by increased prices and our disciplined savings programmes. Gross margins declined by 40bps, albeit on an improving trend, to 39.7% at constant exchange rates. We continued to invest strongly behind our brands and the level of advertising and promotions increased by 10bps. Tight control over overhead costs led to a reduction of 50bps, including a reduction of 20bps in business restructuring. Core operating margin was therefore flat at 13.7% in the first half.
Personal Care
Hair delivered strong double digit growth driven by Dove, with the continuing success of Dove Damage Therapy, and Clear, benefiting from the continuing success of its relaunch as a premium scalp expert. The expansion of our brands into new markets is also contributing strongly, with the launch of Clear in the United States, Tresemmé in Brazil, Dove Hair in the Philippines, and the introduction of Axe Hair in Europe.
Skin cleansing delivered strong growth ahead of our markets, with Dove, Lux and Lifebuoy all performing well. Dove benefited from the continuing success of Nutrium Moisture shower gels and the Dove Men+Care range, which was recently extended to Brazil. Dove bars were launched in Indonesia and Lifebuoy Clini-Care 10 has made an excellent start in India. In skin care, the launch of Simple in the United States is making good progress and Vaseline maintained strong momentum, underpinned by the success of the Total Moisture range. Concern Kalina in Russia is performing well.
Deodorants growth reflected a good performance from Dove on the back of successful innovations and consistent advertising and a good performance from Axe Anarchy. Oral care growth was mid-single digit, reflecting in-market activities which are weighted to the second half. In the first half our new Expert Protection range was launched under the Signal brand in France and under the Pepsodent brand in India.
Core operating margin was down 140bps, primarily due to lower gross margins and the phasing of marketing investments.
Foods
Savoury growth was underpinned by strong performances in Knorr cooking products and soups. Knorr jelly bouillon continued to grow as we supported the latest innovation, gravy, and through successful market development programmes such as the Steak Challenge initiative in Latin America. Knorr baking bags also delivered good growth and are now available in 40 countries. Our Food Solutions business, which serves professional chefs, is helping drive savoury growth by working with our customers to create healthy menus and through the wise up on waste initiatives, working with chefs to reduce energy consumption and food wastage.
In spreads we have increased prices to keep pace with significant commodity cost inflation and this impacted volumes in the first half. We delivered positive growth in the first half and we continued to innovate with the successful Latta aerated product now launched in the Netherlands. Liquid margarines continued to do well in Europe. Dressings continues to grow, reflecting a strong performance by Hellmanns in Latin America driven by the Inspire campaign to encourage new uses of mayonnaise.
Core operating margin was up 50bps, reflecting lower gross margin more than compensated by lower overheads.
2
Home Care
Laundry grew ahead of our markets, reflecting the success of our innovations and the actions taken to improve the product performance. Omo has been re-formulated to deliver faster stain removal and is already available in nine countries. Comfort Anti-Bacterial has been launched in Indonesia and Vietnam.
Household care growth reflected the strong performance of Sunlight hand dishwash. Sunlight was relaunched with an improved degreasing formulation in Vietnam, Indonesia and Malaysia. Domestos was launched in the Gulf, including Saudi Arabia. Cif was launched in Mexico and was extended to affordable pouches in Indonesia.
Core operating margin was up 50bps, primarily due to lower overheads.
Refreshment
Ice cream performed well despite the adverse weather conditions in northern Europe and the high prior year comparator. This reflects good progress in expanding our global footprint. Magnum delivered high single-digit growth, building on the successful launch in the United States with the introduction of Magnum Minis, and with the recent launch of Magnum in the Philippines and Thailand. Cornetto also grew strongly on the back of the Angels & Devils innovation and a successful digital campaign in China. Ben & Jerrys opened its first premium ice cream shop in Japan.
Beverages saw a strong performance in Africa and the Middle East, improved performance in Russia driven by the Lipton re-launch and a good initial response to the launch of Lipton Tea & Honey powdered ready-to-drink tea sachets in the United States.
The 70bps improvement in core operating margin was driven by lower overheads.
OPERATIONAL REVIEW: GEOGRAPHIES
First Half 2012 | ||||||||||||||||||||
(unaudited) |
Turnover | USG | UVG | UPG | Change in core operating margin |
|||||||||||||||
bn | % | % | % | bps | ||||||||||||||||
Unilever Total |
25.4 | 7.0 | 2.8 | 4.1 | 0 | |||||||||||||||
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|
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|
|
|
|
|
|||||||||||
Asia/AMET/RUB |
10.0 | 11.0 | 5.4 | 5.3 | 80 | |||||||||||||||
The Americas |
8.5 | 7.7 | 2.0 | 5.6 | (30 | ) | ||||||||||||||
Europe |
6.9 | 1.1 | 0.3 | 0.7 | (80 | ) |
Asia/AMET/RUB
The first half saw another strong performance with double digit growth. This growth, ahead of our markets, reflected a good balance between price and volume and was driven by strong performances in India, Turkey, Indonesia and Vietnam. Growth rates in Russia continued to improve with a strong contribution from the recently acquired Concern Kalina business. Thailand is recovering well after the floods late in 2011 and the business is back to healthy growth rates. The regional SAP platform was successfully implemented in Central Africa during the period.
Core operating margin was up 80bps, benefiting from higher prices and lower overheads.
The Americas
North America grew at 4.1% in the half year, driven by increased price. Volumes were slightly negative with positive growth in Personal Care more than offset by declines in Foods, most notably spreads.
Latin America growth was 11.6% in the half year, with a good balance between volume and price. Brazil, Argentina and Colombia all performed well. The integration of the newly acquired laundry business in Colombia is progressing to plan.
Core operating margin, down 30bps, was driven by the increase in advertising and promotions expenditure.
Europe
Growth in the first half of 1.1% with stable volume is a creditable performance given continued sluggish economies and fragile consumer confidence. Overall, we grew volumes ahead of our markets and gained value share. We saw continuing good performances in France and the UK.
Core operating margin was down 80bps, mainly due to the impact of higher commodity costs
3
ADDITIONAL COMMENTARY ON THE FINANCIAL STATEMENTS FIRST HALF
Finance costs and tax
The cost of financing net borrowings in the first half 2012 was 201 million versus 195 million in 2011. Whilst the average level of net debt increased, interest rate movements were favourable: the average interest rate on borrowings was 3.7% and the average return on cash deposits was 3.4%. Pensions financing was a debit of 5 million compared with a credit of 30 million in the prior year.
The effective tax rate was 26.1%, the same as 2011. Our longer-term expectation for the tax rate remains around 26%.
Joint ventures, associates and other income from non-current investments
Net profit from joint ventures and associates, together with other income from non-current investments contributed 49 million compared to 87 million in 2011. The income from joint ventures and associates was broadly stable. Income from non-current investments fell, mainly due to the impairment of warrants associated with the disposal of the US laundry business in the current year versus a prior year positive fair value adjustment for warrants associated with the disposal of Johnson Diversey.
Earnings per share
Core earnings per share for the first half was up 6% at 0.76, driven by the improvement in core operating profit, partially offset by higher minority interests. This measure excludes the impact of business disposals, acquisition and disposal related costs, impairments and other one-off items.
Fully diluted earnings per share for the first half was down 3% at 0.75. Higher core operating profit and positive currency were offset by lower profits from business disposals and lower one-off items, principally the pension credit in the prior year.
Restructuring and disposals
Business restructuring spend in the first half was 90bps of turnover, 20bps lower than the same period in 2011. We continue to expect full year business restructuring, expressed as a percentage of turnover, to be at a similar level to 2011. This reflects our determination to make the business fit to compete in the current environment and excludes the restructuring associated with acquisitions and disposals.
Acquisitions-related one-off costs and restructuring amounted to 48 million, significantly lower than the 101 million in 2011 and mainly relating to the integration of Alberto Culver. Business disposals contributed 10 million, lower than the 144 million in 2011 which reflected the disposal of our Brazilian tomatoes business.
Free cash flow and net debt
Free cash flow was 1.5 billion, up from 0.8 billion in 2011. This is mainly due to improved trade working capital performance. Trade working capital as a percentage of sales has now been negative for eleven consecutive quarters.
Closing net debt at 9.2 billion was up from 8.8 billion as at 31 December 2011. The outflow from dividends, acquisitions and the negative impact of foreign exchange rates on net debt together exceeded free cash flow.
Closing cash and cash equivalents was 4.1 billion, up from 3.5 billion as at 31 December 2011. This largely reflects a cautious approach in the context of the ongoing volatility in financial markets.
Pensions
The net pensions deficit was 4.1 billion at the end of June 2012 versus 3.2 billion at the end of 2011. This is mainly due to an increase in liabilities resulting from the decrease in discount rates over the period. Cash expenditure on pensions was 305 million and is still expected to be around 700 million in 2012.
4
Principal risk factors
On pages 28 to 32 of our 2011 Report and Accounts we set out our assessment of the principal risk issues that would face the business through 2012 under the headings: consumer preference; competition; portfolio management; sustainability; customer relationships; people; supply chain; systems and information; business transformation; external economic and political risks, and natural disasters; financial; ethical and legal, regulatory and other risks. In our view, the nature and potential impact of such risks remain essentially unchanged as regards our performance over the second half of 2012.
CAUTIONARY STATEMENT
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 will, aim, expects, anticipates, intends, believes, vision, or the negative of these terms and other similar expressions of future performance or results, 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. Among other risks and uncertainties, the material or principal factors which could cause actual results to differ materially are; Unilevers global brands not meeting consumer preferences; increasing competitive pressures; Unilevers investment choices in its portfolio management; finding sustainable solutions to support long-term growth; customer relationships; the recruitment and retention of talented employees; disruptions in our supply chain; the cost of raw materials and commodities; secure and reliable IT infrastructure; successful execution of acquisitions, divestitures and business transformation projects; economic and political risks and national disasters; the sovereign debt crisis in Europe; financial risks; and failure to meet high product safety and ethical standards; managing regulatory, tax and legal matters. Further details of potential risks and uncertainties affecting the Group are described in the Groups filings with the London Stock Exchange, Euronext Amsterdam and the US Securities and Exchange Commission, including the Groups Annual Report on Form 20-F for the year ended 31 December 2011 and the Annual Report and Accounts 2011. These forward-looking statements speak only as of the date of this announcement. 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 Groups expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
ENQUIRIES
Media: Media Relations Team UK +44 20 7822 6719 trevor.gorin@unilever.com NL +31 10 217 4844 flip.dotsch@unilever.com |
Investors: Investor Relations Team +44 20 7822 6830 investor.relations@unilever.com |
There is a web cast of the results presentation available at:
www.unilever.com/ourcompany/investorcentre/results/quarterlyresults/default.asp
The web cast can also be viewed from the Unilever Investor Relations app which you can download from:
http://itunes.apple.com/us/app/unilever-investor-centre-app/id483403509?mt=8&ign-mpt=uo%3D4
5
INCOME STATEMENT
(unaudited)
million | First Half | |||||||||||||||
2012 | 2011 | Increase/ (Decrease) |
||||||||||||||
Current rates |
Constant rates |
|||||||||||||||
Turnover |
25,398 | 22,788 | 11.5 | % | 9.3 | % | ||||||||||
Operating profit |
3,429 | 3,308 | 4 | % | 2 | % | ||||||||||
After (charging)/crediting non-core items |
(38 | ) | 194 | |||||||||||||
Net finance costs |
(206 | ) | (165 | ) | ||||||||||||
Finance income |
82 | 42 | ||||||||||||||
Finance costs |
(283 | ) | (237 | ) | ||||||||||||
Pensions and similar obligations |
(5 | ) | 30 | |||||||||||||
Share of net profit/(loss) of joint ventures and associates |
60 | 64 | ||||||||||||||
Other income/(loss) from non-current investments |
(11 | ) | 23 | |||||||||||||
Profit before taxation |
3,272 | 3,230 | 1 | % | 0 | % | ||||||||||
Taxation |
(837 | ) | (825 | ) | ||||||||||||
Net profit |
2,435 | 2,405 | 1 | % | 0 | % | ||||||||||
Attributable to: |
||||||||||||||||
Non-controlling interests |
254 | 170 | ||||||||||||||
Shareholders equity |
2,181 | 2,235 | (2 | )% | (4 | )% | ||||||||||
Combined earnings per share |
||||||||||||||||
Basic earnings per share (euros) |
0.77 | 0.79 | (3 | )% | (4 | )% | ||||||||||
Diluted earnings per share (euros) |
0.75 | 0.77 | (3 | )% | (4 | )% |
6
STATEMENT OF COMPREHENSIVE INCOME
(unaudited)
million | First Half | |||||||
2012 | 2011 | |||||||
Net profit |
2,435 | 2,405 | ||||||
Other comprehensive income |
||||||||
Fair value gains/(losses) on financial instruments net of tax |
(69 | ) | (57 | ) | ||||
Actuarial gains/(losses) on pension schemes net of tax |
(722 | ) | 95 | |||||
Currency retranslation gains/(losses) net of tax |
(204 | ) | (270 | ) | ||||
|
|
|
|
|||||
Total comprehensive income |
1,440 | 2,173 | ||||||
|
|
|
|
|||||
Attributable to: |
||||||||
Non-controlling interests |
242 | 132 | ||||||
Shareholders equity |
1,198 | 2,041 |
STATEMENT OF CHANGES IN EQUITY
(unaudited)
million | First Half | |||||||
2012 | 2011 | |||||||
Equity at 1 January |
14,921 | 15,078 | ||||||
Total comprehensive income for the period |
1,440 | 2,173 | ||||||
Dividends on ordinary capital |
(1,323 | ) | (1,221 | ) | ||||
Movement in treasury stock |
31 | (43 | ) | |||||
Share-based payment credit |
66 | 66 | ||||||
Dividends paid to non-controlling interests |
(99 | ) | (93 | ) | ||||
Currency retranslation gains/(losses) net of tax |
1 | (10 | ) | |||||
Other movements in equity |
(89 | ) | (94 | ) | ||||
|
|
|
|
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Equity at the end of the period |
14,948 | 15,856 | ||||||
|
|
|
|
7
BALANCE SHEET
(unaudited)
million |
As at 30 June 2012 |
As at 31 December 2011 |
As at 30 June 2011 |
|||||||||
Non-current assets |
||||||||||||
Goodwill |
15,012 | 14,896 | 14,133 | |||||||||
Intangible assets |
7,249 | 7,017 | 6,124 | |||||||||
Property, plant and equipment |
9,113 | 8,774 | 8,018 | |||||||||
Pension asset for funded schemes in surplus |
599 | 1,003 | 1,130 | |||||||||
Deferred tax assets |
366 | 421 | 235 | |||||||||
Financial assets |
574 | 478 | 493 | |||||||||
Other non-current assets |
562 | 632 | 548 | |||||||||
|
|
|
|
|
|
|||||||
33,475 | 33,221 | 30,681 | ||||||||||
|
|
|
|
|
|
|||||||
Current assets |
||||||||||||
Inventories |
5,003 | 4,601 | 4,633 | |||||||||
Trade and other current receivables |
5,462 | 4,513 | 5,421 | |||||||||
Current tax assets |
702 | 219 | 231 | |||||||||
Cash and cash equivalents |
4,097 | 3,484 | 2,332 | |||||||||
Other financial assets |
564 | 1,453 | 568 | |||||||||
Non-current assets held for sale |
143 | 21 | 169 | |||||||||
|
|
|
|
|
|
|||||||
15,971 | 14,291 | 13,354 | ||||||||||
|
|
|
|
|
|
|||||||
Total assets |
49,446 | 47,512 | 44,035 | |||||||||
|
|
|
|
|
|
|||||||
Current liabilities |
||||||||||||
Financial liabilities |
6,564 | 5,840 | 3,153 | |||||||||
Trade payables and other current liabilities |
11,977 | 10,971 | 10,849 | |||||||||
Current tax liabilities |
1,474 | 725 | 650 | |||||||||
Provisions |
352 | 393 | 395 | |||||||||
Liabilities associated with assets held for sale |
| | 32 | |||||||||
|
|
|
|
|
|
|||||||
20,367 | 17,929 | 15,079 | ||||||||||
|
|
|
|
|
|
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Non-current liabilities |
||||||||||||
Financial liabilities |
7,248 | 7,878 | 7,852 | |||||||||
Non-current tax liabilities |
188 | 258 | 200 | |||||||||
Pensions and post-retirement healthcare liabilities: |
||||||||||||
Funded schemes in deficit |
2,685 | 2,295 | 932 | |||||||||
Unfunded schemes |
1,981 | 1,911 | 1,746 | |||||||||
Provisions |
962 | 908 | 887 | |||||||||
Deferred tax liabilities |
725 | 1,125 | 1,219 | |||||||||
Other non-current liabilities |
342 | 287 | 264 | |||||||||
|
|
|
|
|
|
|||||||
14,131 | 14,662 | 13,100 | ||||||||||
|
|
|
|
|
|
|||||||
Total liabilities |
34,498 | 32,591 | 28,179 | |||||||||
|
|
|
|
|
|
|||||||
Equity |
||||||||||||
Shareholders equity |
14,234 | 14,293 | 15,275 | |||||||||
Non-controlling interests |
714 | 628 | 581 | |||||||||
|
|
|
|
|
|
|||||||
Total equity |
14,948 | 14,921 | 15,856 | |||||||||
|
|
|
|
|
|
|||||||
Total liabilities and equity |
49,446 | 47,512 | 44,035 | |||||||||
|
|
|
|
|
|
8
CASH FLOW STATEMENT
(unaudited)
million | First Half | |||||||
2012 | 2011 | |||||||
Net profit |
2,435 | 2,405 | ||||||
Taxation |
837 | 825 | ||||||
Share of net profit of joint ventures/associates and other income from non-current investments |
(49 | ) | (87 | ) | ||||
Net finance costs |
206 | 165 | ||||||
|
|
|
|
|||||
Operating profit |
3,429 | 3,308 | ||||||
|
|
|
|
|||||
Depreciation, amortisation and impairment |
582 | 505 | ||||||
Changes in working capital |
(488 | ) | (1,191 | ) | ||||
Pensions and similar obligations less payments |
(163 | ) | (240 | ) | ||||
Provisions less payments |
38 | 97 | ||||||
Elimination of (profits)/losses on disposals |
(128 | ) | (132 | ) | ||||
Non-cash charge for share-based compensation |
66 | 66 | ||||||
Other adjustments |
4 | 10 | ||||||
|
|
|
|
|||||
Cash flow from operating activities |
3,340 | 2,423 | ||||||
|
|
|
|
|||||
Income tax paid |
(801 | ) | (552 | ) | ||||
|
|
|
|
|||||
Net cash flow from operating activities |
2,539 | 1,871 | ||||||
|
|
|
|
|||||
Interest received |
81 | 43 | ||||||
Net capital expenditure |
(826 | ) | (906 | ) | ||||
Acquisitions and disposals |
(94 | ) | (1,381 | ) | ||||
Other investing activities |
996 | (43 | ) | |||||
|
|
|
|
|||||
Net cash flow (used in)/from investing activities |
157 | (2,287 | ) | |||||
|
|
|
|
|||||
Dividends paid on ordinary share capital |
(1,324 | ) | (1,220 | ) | ||||
Interest and preference dividends paid |
(257 | ) | (204 | ) | ||||
Change in financial liabilities |
(13 | ) | 1,695 | |||||
Other movements on treasury stock |
31 | (48 | ) | |||||
Other financing activities |
(85 | ) | (208 | ) | ||||
|
|
|
|
|||||
Net cash flow (used in)/from financing activities |
(1,648 | ) | 15 | |||||
|
|
|
|
|||||
Net increase/(decrease) in cash and cash equivalents |
1,048 | (401 | ) | |||||
|
|
|
|
|||||
Cash and cash equivalents at the beginning of the period |
2,978 | 1,966 | ||||||
Effect of foreign exchange rate changes |
(260 | ) | 161 | |||||
|
|
|
|
|||||
Cash and cash equivalents at the end of the period |
3,766 | 1,726 | ||||||
|
|
|
|
9
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
1 | ACCOUNTING INFORMATION AND POLICIES |
Except for the revised policy on operating segments and the replacement of underlying operating profit with core operating profit as a non-GAAP measure (see below), the accounting policies and methods of computation are consistent with the year ended 31 December 2011 and are in compliance with IAS 34 Interim Financial Reporting. 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.
The Group has revised its operating segments to align with the new structure under which the business is managed. Beginning 2012, operating segment information is provided based on four product areas: Personal Care, Foods, Home Care and Refreshment. Additional information is provided by geographies.
From 2012 the Group refers to core operating profit and core operating margin as non-GAAP measures. This means operating profit and operating margin, respectively, before the impact of business disposals, acquisition and disposal related costs, impairments and other one-off items, which we collectively term non-core items, on the grounds that the incidence of these items is uneven between reporting periods. The Group also refers to core earnings per share (core EPS). In calculating core EPS, net profit attributable to shareholders equity is adjusted to eliminate the post tax impact of non-core items.
After making appropriate enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the half year financial statements.
The condensed interim financial statements are shown at current exchange rates, while percentage year-on-year changes are shown at both current and constant exchange rates to facilitate comparison. The income statement on page 7, the statements of comprehensive income and changes in equity on page 8, the cash flow statement on page 10, and the free cash flow note on page 15 are translated at exchange rates current in each period. The balance sheet on page 9 and the net debt note on page 16 are translated at period-end rates of exchange.
The condensed interim financial statements attached do not constitute the full financial statements within the meaning of Section 434 of the UK Companies Act 2006. Full accounts for Unilever for the year ended 31 December 2011 have been delivered to the Registrar of Companies. The auditors reports on these accounts were unqualified and did not contain a statement under Section 498 (2) or Section 498 (3) of the UK Companies Act 2006.
Recent accounting developments
The Group has not adopted new or amended IFRSs or IFRIC interpretations in the six month period ended 30 June 2012.
10
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
2 | NON-GAAP MEASURES AND OTHER SUPPLEMENTARY SCHEDULES |
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. Unilever uses constant rate and underlying measures primarily for internal performance analysis and targeting purposes.
The principal non-GAAP measure which we apply in our reporting is underlying sales growth (abbreviated to USG or growth), which we reconcile to changes in the GAAP measure turnover in notes 4 and 5. Underlying sales growth represents turnover growth at constant exchange rates, excluding the effects of acquisitions and disposals. Turnover includes the impact of exchange rates, acquisitions and disposals.
Other non-GAAP measures are core operating profit, core operating margin and core EPS, as explained in note 1. Core EPS is further discussed on page 4 and in note 9. We also discuss free cash flow, which we reconcile in note 7 to the amounts in the cash flow statement, and net debt, which we reconcile in note 8 to the amounts reported in our balance sheet and cash flow statement.
3 | SIGNIFICANT ITEMS WITHIN THE INCOME STATEMENT |
In our income statement reporting we disclose the total value of non-core items that arise within operating profit.
million | First Half | |||||||
2012 | 2011 | |||||||
Acquisition and disposal related costs |
(48 | ) | (101 | ) | ||||
Gain/(loss) on disposal of group companies |
10 | 144 | ||||||
Impairments and other one-off items |
| 151 | ||||||
|
|
|
|
|||||
Non-core items before tax |
(38 | ) | 194 | |||||
Tax impact of non-core items |
11 | (30 | ) | |||||
|
|
|
|
|||||
Non-core items after tax |
(27 | ) | 164 | |||||
Attributable to: |
||||||||
Non-controlling interests |
| | ||||||
Shareholders equity |
(27 | ) | 164 |
The following table shows the impact of non-core items on profit attributable to shareholders.
million | First Half | |||||||
2012 | 2011 | |||||||
Net profit attributable to shareholders equity |
2,181 | 2,235 | ||||||
Post tax impact of non-core items |
27 | (164 | ) | |||||
|
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|||||
Core profit attributable to shareholders equity |
2,208 | 2,071 | ||||||
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11
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
4 | SEGMENT INFORMATION - CATEGORIES |
First Half |
Personal Care | Foods | Home Care |
Refreshment | Total | |||||||||||||||
Turnover ( million) |
||||||||||||||||||||
2011 |
7,236 | 6,834 | 4,018 | 4,700 | 22,788 | |||||||||||||||
2012 |
8,715 | 7,131 | 4,378 | 5,174 | 25,398 | |||||||||||||||
Change (%) |
20.4 | 4.3 | 9.0 | 10.1 | 11.5 | |||||||||||||||
Impact of: |
||||||||||||||||||||
Exchange rates (%) |
2.1 | 2.2 | (0.6 | ) | 3.4 | 1.9 | ||||||||||||||
Acquisitions (%) |
7.4 | 0.0 | 1.0 | 0.8 | 2.8 | |||||||||||||||
Disposals (%) |
(0.4 | ) | (1.1 | ) | (1.2 | ) | 0.6 | (0.5 | ) | |||||||||||
Underlying sales growth (%) |
10.4 | 3.2 | 9.8 | 4.9 | 7.0 | |||||||||||||||
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Price (%) |
3.5 | 4.2 | 4.3 | 4.5 | 4.1 | |||||||||||||||
Volume (%) |
6.7 | (1.0 | ) | 5.3 | 0.3 | 2.8 | ||||||||||||||
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Operating profit ( million) |
||||||||||||||||||||
2011 |
1,216 | 1,384 | 215 | 493 | 3,308 | |||||||||||||||
2012 |
1,406 | 1,264 | 219 | 540 | 3,429 | |||||||||||||||
Core operating profit ( million) |
||||||||||||||||||||
2011 |
1,302 | 1,176 | 178 | 458 | 3,114 | |||||||||||||||
2012 |
1,448 | 1,264 | 215 | 540 | 3,467 | |||||||||||||||
Operating margin (%) |
||||||||||||||||||||
2011 |
16.8 | 20.3 | 5.4 | 10.5 | 14.5 | |||||||||||||||
2012 |
16.1 | 17.7 | 5.0 | 10.4 | 13.5 | |||||||||||||||
Core operating margin (%) |
||||||||||||||||||||
2011 |
18.0 | 17.2 | 4.4 | 9.7 | 13.7 | |||||||||||||||
2012 |
16.6 | 17.7 | 4.9 | 10.4 | 13.7 |
12
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
5 | SEGMENT INFORMATION - GEOGRAPHIES |
First Half |
Asia / AMET / RUB |
The Americas |
Europe | Total | ||||||||||||
Turnover ( million) |
||||||||||||||||
2011 |
8,697 | 7,368 | 6,723 | 22,788 | ||||||||||||
2012 |
9,977 | 8,479 | 6,942 | 25,398 | ||||||||||||
Change (%) |
14.7 | 15.1 | 3.3 | 11.5 | ||||||||||||
Impact of: |
||||||||||||||||
Exchange rates (%) |
1.7 | 3.2 | 0.6 | 1.9 | ||||||||||||
Acquisitions (%) |
1.9 | 4.3 | 2.3 | 2.8 | ||||||||||||
Disposals (%) |
(0.3 | ) | (0.7 | ) | (0.7 | ) | (0.5 | ) | ||||||||
Underlying sales growth (%) |
11.0 | 7.7 | 1.1 | 7.0 | ||||||||||||
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Price (%) |
5.3 | 5.6 | 0.7 | 4.1 | ||||||||||||
Volume (%) |
5.4 | 2.0 | 0.3 | 2.8 | ||||||||||||
|
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Operating profit ( million) |
||||||||||||||||
2011 |
1,080 | 1,146 | 1,082 | 3,308 | ||||||||||||
2012 |
1,337 | 1,115 | 977 | 3,429 | ||||||||||||
Core operating profit ( million) |
||||||||||||||||
2011 |
1,098 | 1,016 | 1,000 | 3,114 | ||||||||||||
2012 |
1,341 | 1,148 | 978 | 3,467 | ||||||||||||
Operating margin (%) |
||||||||||||||||
2011 |
12.4 | 15.6 | 16.1 | 14.5 | ||||||||||||
2012 |
13.4 | 13.2 | 14.1 | 13.5 | ||||||||||||
Core operating margin (%) |
||||||||||||||||
2011 |
12.6 | 13.8 | 14.9 | 13.7 | ||||||||||||
2012 |
13.4 | 13.5 | 14.1 | 13.7 |
Additional geographical information
First Half 2012 | First Half 2011 | |||||||||||||||||||||||||||||||
Turnover | USG | UVG | UPG | Turnover | USG | UVG | UPG | |||||||||||||||||||||||||
m | % | % | % | m | % | % | % | |||||||||||||||||||||||||
Unilever Total |
25,398 | 7.0 | 2.8 | 4.1 | 22,788 | 5.7 | 2.2 | 3.5 | ||||||||||||||||||||||||
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Developed markets |
11,550 | 1.9 | (0.1 | ) | 2.0 | 10,544 | 0.8 | (0.9 | ) | 1.6 | ||||||||||||||||||||||
Emerging markets |
13,848 | 11.4 | 5.4 | 5.8 | 12,244 | 10.3 | 4.9 | 5.1 | ||||||||||||||||||||||||
First Half 2012 | First Half 2011 | |||||||||||||||||||||||||||||||
Turnover | USG | UVG | UPG | Turnover | USG | UVG | UPG | |||||||||||||||||||||||||
m | % | % | % | m | % | % | % | |||||||||||||||||||||||||
The Americas |
8,479 | 7.7 | 2.0 | 5.6 | 7,368 | 5.3 | 0.3 | 5.0 | ||||||||||||||||||||||||
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North America |
4,471 | 4.1 | (0.5 | ) | 4.6 | 3,766 | 1.5 | (1.5 | ) | 3.1 | ||||||||||||||||||||||
Latin America |
4,008 | 11.6 | 4.7 | 6.6 | 3,602 | 9.7 | 2.4 | 7.1 |
13
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
6 | TAXATION |
The effective tax rate for the first half was 26.1%, the same level as 2011. The tax rate is calculated by dividing the tax charge by pre-tax profit excluding the contribution of joint ventures and associates.
Tax effects of components of other comprehensive income were as follows:
million | First Half 2012 | First Half 2011 | ||||||||||||||||||||||
Before tax |
Tax (charge)/ credit |
After tax |
Before tax |
Tax (charge)/ credit |
After tax |
|||||||||||||||||||
Fair value gains/(losses) on financial instruments |
(74 | ) | 5 | (69 | ) | (66 | ) | 9 | (57 | ) | ||||||||||||||
Actuarial gains/(losses) on pension schemes |
(935 | ) | 213 | (722 | ) | 145 | (50 | ) | 95 | |||||||||||||||
Currency retranslation gains/(losses) |
(208 | ) | 4 | (204 | ) | (278 | ) | 8 | (270 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other comprehensive income |
(1,217 | ) | 222 | (995 | ) | (199 | ) | (33 | ) | (232 | ) | |||||||||||||
|
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|
|
|
|
|
|
|
|
|
7 | FREE CASH FLOW |
million | First Half | |||||||
2012 | 2011 | |||||||
Cash flow from operating activities |
3,340 | 2,423 | ||||||
Income tax paid |
(801 | ) | (552 | ) | ||||
Net capital expenditure |
(826 | ) | (906 | ) | ||||
Net interest and preference dividends paid |
(176 | ) | (161 | ) | ||||
|
|
|
|
|||||
Free cash flow |
1,537 | 804 | ||||||
|
|
|
|
8 | NET DEBT |
million | As at 30 June 2012 |
As at 31 December 2011 |
As at 30 June 2011 |
|||||||||
Total financial liabilities |
(13,812 | ) | (13,718 | ) | (11,005 | ) | ||||||
Current financial liabilities |
(6,564 | ) | (5,840 | ) | (3,153 | ) | ||||||
Non-current financial liabilities |
(7,248 | ) | (7,878 | ) | (7,852 | ) | ||||||
Cash and cash equivalents as per balance sheet |
4,097 | 3,484 | 2,332 | |||||||||
Cash and cash equivalents as per cash flow statement |
3,766 | 2,978 | 1,726 | |||||||||
Add bank overdrafts deducted therein |
331 | 506 | 606 | |||||||||
Other financial assets |
564 | 1,453 | 568 | |||||||||
|
|
|
|
|
|
|||||||
Net debt |
(9,151 | ) | (8,781 | ) | (8,105 | ) | ||||||
|
|
|
|
|
|
14
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
9 | 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 and core earnings per share, a number of adjustments are made to the number of shares, principally: (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 six months were calculated as follows:
2012 | 2011 | |||||||
Combined EPS Basic |
||||||||
Net profit attributable to shareholders equity ( million) |
2,181 | 2,235 | ||||||
Average number of combined share units (millions of units) |
2,826.9 | 2,814.2 | ||||||
Combined EPS basic () |
0.77 | 0.79 | ||||||
Combined EPS Diluted |
||||||||
Net profit attributable to shareholders equity ( million) |
2,181 | 2,235 | ||||||
Adjusted average number of combined share units (millions of units) |
2,916.8 | 2,906.3 | ||||||
Combined EPS diluted () |
0.75 | 0.77 | ||||||
Core EPS |
||||||||
Core profit attributable to shareholders equity (see note 4) ( million) |
2,208 | 2,071 | ||||||
Adjusted average number of combined share units (millions of units) |
2,916.8 | 2,906.3 | ||||||
Core EPS diluted () |
0.76 | 0.71 |
In calculating core earnings per share, net profit attributable to shareholders equity is adjusted to eliminate the post tax impact of business disposals, acquisition and disposals and related costs, impairments, and other one-off items.
During the period the following movements in shares have taken place:
Millions | ||||
Number of shares at 31 December 2011 (net of treasury stock) |
2,820.4 | |||
Net movements in shares under incentive schemes |
9.4 | |||
|
|
|||
Number of shares at 30 June 2012 |
2,829.8 | |||
|
|
10 | ACQUISITIONS AND DISPOSALS |
There were no material acquisitions or disposals for the period ended 30 June 2012.
15
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
11 | DIVIDENDS |
The Boards have declared quarterly interim dividend for Q1 2012 and Q2 2012 at the following rates which are equivalent in value at the rate of exchange applied under the terms of the Equalisation Agreement between the two companies:
Q1 2012 | Q2 2012 | |||||||
Per Unilever N.V. ordinary share |
| 0.2430 | | 0.2430 | ||||
Per Unilever PLC ordinary share |
£ | 0.1981 | £ | 0.1892 | ||||
Per Unilever N.V. New York share |
US$ | 0.3198 | US$ | 0.2938 | ||||
Per Unilever PLC American Depositary Receipt |
US$ | 0.3198 | US$ | 0.2938 |
The quarterly dividend calendar for the remainder of 2012 will be as follows:
Announcement Date |
Ex-Dividend Date | Record Date | Payment Date | |||||
Quarterly dividend for Q2 2012 |
26 July 2012 | 8 August 2012 | 10 August 2012 | 12 September 2012 | ||||
Quarterly dividend for Q3 2012 |
25 October 2012 | 7 November 2012 | 9 November 2012 | 12 December 2012 |
12 | EVENTS AFTER THE BALANCE SHEET DATE |
There were no material post balance sheet events other than those mentioned elsewhere in this report.
16
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS |
On 1 November 2011, Unilever N.V. and Unilever Capital Corporation (UCC) filed a US Shelf registration, which is unconditionally and fully guaranteed, jointly and severally, by Unilever N.V. (NV), Unilever PLC (PLC) and Unilever United States, Inc. (UNUS). This superseded the previous NV and UCC US Shelf registration filed on 18 November 2008, which is unconditionally and fully guaranteed, jointly and severally, by NV, PLC and UNUS. Of the US Shelf registration, US $4.0 billion of Notes were outstanding at 30 June 2012 (2011 US $ 4.0 billion, 2010 US $2.5 billion, 2009: US $4.25 billion), with coupons ranging from 2.75% to 5.9%. These Notes are repayable between 15 February 2014 and 15 November 2032.
Provided below are the income statements, cash flow statements and balance sheets of each of the companies discussed above, together with the income statement, cash flow statement and balance sheet of non-guarantor subsidiaries. These have been prepared under the historical cost convention, and, aside from the basis of accounting for investments at net asset value (equity accounting), comply in all material respects with International Financial Reporting Standards. The financial information in respect on NV, PLC and UNUS has been prepared with all subsidiaries accounted for on an equity basis. Information on NV and PLC is shown collectively as Unilever parent entities. The financial information in respect of the non-guarantor subsidiaries has been prepared on a consolidated basis.
million | ||||||||||||||||||||||||
Income Statement Six months ended 30 June 2012 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non-guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Turnover |
| | | 25,398 | | 25,398 | ||||||||||||||||||
Operating profit |
| 76 | (8 | ) | 3,361 | | 3,429 | |||||||||||||||||
Finance income |
| | | 82 | | 82 | ||||||||||||||||||
Finance costs |
(75 | ) | (87 | ) | | (121 | ) | | (283 | ) | ||||||||||||||
Pensions and similar obligations |
| (2 | ) | (9 | ) | 6 | | (5 | ) | |||||||||||||||
Inter-company finance income/(costs) |
75 | 15 | (57 | ) | (33 | ) | | | ||||||||||||||||
Dividends |
| 4 | 676 | (680 | ) | | | |||||||||||||||||
Share of net profit/(loss) of joint ventures and associates |
| | | 60 | | 60 | ||||||||||||||||||
Other income from non-current investments |
| | | (11 | ) | | (11 | ) | ||||||||||||||||
Profit before taxation |
| 6 | 602 | 2,664 | | 3,272 | ||||||||||||||||||
Taxation |
| 98 | (109 | ) | (826 | ) | | (837 | ) | |||||||||||||||
Net profit |
| 104 | 493 | 1,838 | | 2,435 | ||||||||||||||||||
Equity earnings of subsidiaries |
| 2,331 | 415 | | (2,746 | ) | | |||||||||||||||||
Net profit |
| 2,435 | 908 | 1,838 | (2,746 | ) | 2,435 | |||||||||||||||||
Attributed to: |
||||||||||||||||||||||||
Non-controlling interests |
| | | 254 | | 254 | ||||||||||||||||||
Shareholders equity |
| 2,435 | 908 | 1,584 | (2,746 | ) | 2,181 |
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
17
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS (continued) |
million | ||||||||||||||||||||||||
Income Statement Six months ended 30 June 2011 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non- guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Turnover |
| | | 22,788 | | 22,788 | ||||||||||||||||||
Operating profit |
| 120 | (8 | ) | 3,196 | | 3,308 | |||||||||||||||||
Finance income |
| | | 42 | | 42 | ||||||||||||||||||
Finance costs |
(63 | ) | (61 | ) | | (113 | ) | | (237 | ) | ||||||||||||||
Pensions and similar obligations |
| (2 | ) | (10 | ) | 42 | | 30 | ||||||||||||||||
Inter-company finance income/(costs) |
63 | 23 | (62 | ) | (24 | ) | | | ||||||||||||||||
Dividends |
| 121 | | (121 | ) | | | |||||||||||||||||
Share of net profit/(loss) of joint ventures and associates |
| | | 64 | | 64 | ||||||||||||||||||
Other income from non-current investments |
| | | 23 | | 23 | ||||||||||||||||||
Profit before taxation |
| 201 | (80 | ) | 3,109 | | 3,230 | |||||||||||||||||
Taxation |
| (22 | ) | (136 | ) | (667 | ) | | (825 | ) | ||||||||||||||
Net profit |
| 179 | (216 | ) | 2,442 | | 2,405 | |||||||||||||||||
Equity earning of subsidiaries |
| 2,226 | 442 | | (2,668 | ) | | |||||||||||||||||
Net profit |
| 2,405 | 226 | 2,442 | (2,668 | ) | 2,405 | |||||||||||||||||
Attributed to: |
||||||||||||||||||||||||
Non-controlling interests |
| | | 170 | | 170 | ||||||||||||||||||
Shareholders equity |
| 2,405 | 226 | 2,272 | (2,668 | ) | 2,235 |
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
18
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS (continued) |
million | ||||||||||||||||||||||||
Balance Sheet As at 30 June 2012 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non- guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Non-current assets |
||||||||||||||||||||||||
Goodwill and intangible assets |
| 290 | | 21,971 | | 22,261 | ||||||||||||||||||
Property, plant and equipment |
| | | 9,113 | | 9,113 | ||||||||||||||||||
Pension asset for funded schemes in surplus |
| 5 | | 594 | | 599 | ||||||||||||||||||
Deferred tax assets |
| 116 | 316 | (66 | ) | | 366 | |||||||||||||||||
Financial assets |
| | 1 | 573 | | 574 | ||||||||||||||||||
Other non-current assets |
| | 9 | 553 | | 562 | ||||||||||||||||||
Amounts due from group companies |
6,418 | | | | (6,418 | ) | | |||||||||||||||||
Net assets of subsidiaries (equity accounted) |
| 41,046 | 14,847 | (17,981 | ) | (37,912 | ) | | ||||||||||||||||
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6,418 | 41,457 | 15,173 | 14,757 | (44,330 | ) | 33,475 | ||||||||||||||||||
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Current assets |
||||||||||||||||||||||||
Inventories |
| | | 5,003 | | 5,003 | ||||||||||||||||||
Amounts due from group companies |
| 7,185 | 1,681 | (8,866 | ) | | | |||||||||||||||||
Trade and other current receivables |
| 113 | 9 | 5,340 | | 5,462 | ||||||||||||||||||
Current tax assets |
| 263 | 167 | 272 | | 702 | ||||||||||||||||||
Other financial assets |
| 9 | | 555 | | 564 | ||||||||||||||||||
Cash and cash equivalents |
| 4 | | 4,093 | | 4,097 | ||||||||||||||||||
Non-current assets held for sale |
| | | 143 | | 143 | ||||||||||||||||||
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|
|||||||||||||
| 7,574 | 1,857 | 6,540 | | 15,971 | |||||||||||||||||||
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|
|
|||||||||||||
Total assets |
6,418 | 49,031 | 17,030 | 21,297 | (44,330 | ) | 49,446 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Current liabilities |
||||||||||||||||||||||||
Financial liabilities |
2,300 | 3,217 | 4 | 1,043 | | 6,564 | ||||||||||||||||||
Amounts due to group companies |
607 | 28,993 | | (29,600 | ) | | | |||||||||||||||||
Trade payables and other current liabilities |
45 | 173 | 16 | 11,743 | | 11,977 | ||||||||||||||||||
Current tax liabilities |
| 213 | | 1,261 | | 1,474 | ||||||||||||||||||
Provisions |
| 11 | | 341 | | 352 | ||||||||||||||||||
Liabilities associated with assets held for sale |
| | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
2,952 | 32,607 | 20 | (15,212 | ) | | 20,367 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-current liabilities |
||||||||||||||||||||||||
Financial liabilities |
3,157 | 2,066 | | 2,025 | | 7,248 | ||||||||||||||||||
Amounts due to group companies |
13 | | 6,424 | (19 | ) | (6,418 | ) | | ||||||||||||||||
Pension and post-retirement healthcare liabilities: |
||||||||||||||||||||||||
Funded schemes in deficit |
| | 165 | 2,520 | | 2,685 | ||||||||||||||||||
Unfunded schemes |
| 94 | 617 | 1,270 | | 1,981 | ||||||||||||||||||
Provisions |
| 25 | 1 | 936 | | 962 | ||||||||||||||||||
Deferred tax liabilities |
| | | 725 | | 725 | ||||||||||||||||||
Other non-current liabilities |
| 5 | 157 | 368 | | 530 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
3,170 | 2,190 | 7,364 | 7,825 | (6,418 | ) | 14,131 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
6,122 | 34,797 | 7,384 | (7,387 | ) | (6,418 | ) | 34,498 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Shareholders equity |
||||||||||||||||||||||||
Called up share capital |
| 484 | | | | 484 | ||||||||||||||||||
Share premium account |
| 141 | 942 | (942 | ) | | 141 | |||||||||||||||||
Other reserves |
21 | (6,079 | ) | (932 | ) | (1,249 | ) | 2,160 | (6,079 | ) | ||||||||||||||
Retained profit |
275 | 19,688 | 9,636 | 30,161 | (40,072 | ) | 19,688 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total shareholders equity |
296 | 14,234 | 9,646 | 27,970 | (37,912 | ) | 14,234 | |||||||||||||||||
Non-controlling interests |
| | | 714 | | 714 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total equity |
296 | 14,234 | 9,646 | 28,684 | (37,912 | ) | 14,948 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities and equity |
6,418 | 49,031 | 17,030 | 21,297 | (44,330 | ) | 49,446 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
19
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS (continued) |
million | ||||||||||||||||||||||||
Balance Sheet As at 31 December 2011 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non- guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Non-current assets |
||||||||||||||||||||||||
Goodwill and intangible assets |
| 162 | | 21,751 | | 21,913 | ||||||||||||||||||
Property, plant and equipment |
| | | 8,774 | | 8,774 | ||||||||||||||||||
Pension asset for funded schemes in surplus |
| 5 | | 998 | | 1,003 | ||||||||||||||||||
Deferred tax assets |
| | 373 | 48 | | 421 | ||||||||||||||||||
Financial assets |
| | | 478 | | 478 | ||||||||||||||||||
Other non-current assets |
| | | 632 | | 632 | ||||||||||||||||||
Amounts due from group companies |
5,498 | | | | (5,498 | ) | | |||||||||||||||||
Net assets of subsidiaries (equity accounted) |
| 39,816 | 14,213 | (17,992 | ) | (36,037 | ) | | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
5,498 | 39,983 | 14,586 | 14,689 | (41,535 | ) | 33,221 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Current assets |
||||||||||||||||||||||||
Inventories |
| | | 4,601 | | 4,601 | ||||||||||||||||||
Amounts due from group companies |
| 8,562 | 2,042 | (10,604 | ) | | | |||||||||||||||||
Trade and other current receivables |
| 70 | 3 | 4,440 | | 4,513 | ||||||||||||||||||
Current tax assets |
| 256 | 109 | (146 | ) | | 219 | |||||||||||||||||
Other financial assets |
| 1 | | 1,452 | | 1,453 | ||||||||||||||||||
Cash and cash equivalents |
| 1 | | 3,483 | | 3,484 | ||||||||||||||||||
Non-current assets held for sale |
| | | 21 | | 21 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| 8,890 | 2,154 | 3,247 | | 14,291 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total assets |
5,498 | 48,873 | 16,740 | 17,936 | (41,535 | ) | 47,512 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Current liabilities |
||||||||||||||||||||||||
Financial liabilities |
1,526 | 2,087 | 3 | 2,224 | | 5,840 | ||||||||||||||||||
Amounts due to group companies |
573 | 25,638 | 14 | (26,225 | ) | | | |||||||||||||||||
Trade payables and other current liabilities |
42 | 170 | 11 | 10,748 | | 10,971 | ||||||||||||||||||
Current tax liabilities |
| 187 | | 538 | | 725 | ||||||||||||||||||
Provisions |
| 13 | | 380 | | 393 | ||||||||||||||||||
Liabilities associated with assets held for sale |
| | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
2,141 | 28,095 | 28 | (12,335 | ) | | 17,929 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-current liabilities |
||||||||||||||||||||||||
Financial liabilities |
3,068 | 3,207 | | 1,603 | | 7,878 | ||||||||||||||||||
Amounts due to group companies |
| 3,091 | 5,498 | (3,091 | ) | (5,498 | ) | | ||||||||||||||||
Pension and post-retirement healthcare liabilities: |
||||||||||||||||||||||||
Funded schemes in deficit |
| | 187 | 2,108 | | 2,295 | ||||||||||||||||||
Unfunded schemes |
| 96 | 608 | 1,207 | | 1,911 | ||||||||||||||||||
Provisions |
| 33 | 1 | 874 | | 908 | ||||||||||||||||||
Deferred tax liabilities |
| 53 | | 1,072 | | 1,125 | ||||||||||||||||||
Other non-current liabilities |
| 5 | 138 | 402 | | 545 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
3,068 | 6,485 | 6,432 | 4,175 | (5,498 | ) | 14,662 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
5,209 | 34,580 | 6,460 | (8,160 | ) | (5,498 | ) | 32,591 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Shareholders equity |
||||||||||||||||||||||||
Called up share capital |
| 484 | | | | 484 | ||||||||||||||||||
Share premium account |
| 137 | 942 | (942 | ) | | 137 | |||||||||||||||||
Other reserves |
14 | (6,004 | ) | (791 | ) | (1,428 | ) | 2,205 | (6,004 | ) | ||||||||||||||
Retained Profit |
275 | 19,676 | 10,129 | 27,838 | (38,242 | ) | 19,676 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
289 | 14,293 | 10,280 | 25,468 | (36,037 | ) | 14,293 | ||||||||||||||||||
Non-controlling interests |
| | | 628 | | 628 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total equity |
289 | 14,293 | 10,280 | 26,096 | (36,037 | ) | 14,921 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities and equity |
5,498 | 48,873 | 16,740 | 17,936 | (41,535 | ) | 47,512 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
20
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS (continued) |
million | ||||||||||||||||||||||||
Cash flow statement Six months ended 30 June 2012 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non- guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Cash flow from operating activities |
| (128 | ) | (19 | ) | 3,487 | | 3,340 | ||||||||||||||||
Income tax paid |
| (45 | ) | (92 | ) | (664 | ) | | (801 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from operating activities |
| (173 | ) | (111 | ) | 2,823 | | 2,539 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Interest received |
| 18 | | 63 | | 81 | ||||||||||||||||||
Net capital expenditure |
| (134 | ) | | (692 | ) | | (826 | ) | |||||||||||||||
Acquisitions and disposals |
| | | (94 | ) | | (94 | ) | ||||||||||||||||
Other investing activities |
(696 | ) | 2,247 | 390 | (1,631 | ) | 686 | 996 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from /(used in) investing activities |
(696 | ) | 2,131 | 390 | (2,354 | ) | 686 | 157 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Dividends paid on ordinary share capital |
| (1,328 | ) | (917 | ) | 921 | | (1,324 | ) | |||||||||||||||
Interest and preference dividends paid |
(70 | ) | (94 | ) | | (93 | ) | | (257 | ) | ||||||||||||||
Change in borrowing and finance leases |
701 | 65 | | (779 | ) | | (13 | ) | ||||||||||||||||
Other movement in treasury stocks |
| 122 | (50 | ) | (41 | ) | | 31 | ||||||||||||||||
Other finance activities |
65 | (712 | ) | 686 | 562 | (686 | ) | (85 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from/(used in) financing activities |
696 | (1,947 | ) | (281 | ) | 570 | (686 | ) | (1,648 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net increase/(decrease) in cash and cash equivalents |
| 11 | (2 | ) | 1,039 | | 1,048 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at beginning of year |
| 1 | (2 | ) | 2,979 | | 2,978 | |||||||||||||||||
Effect of foreign exchange rates |
| (8 | ) | | (252 | ) | | (260 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at end of year |
| 4 | (4 | ) | 3,766 | | 3,766 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
21
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
13 | GUARANTOR STATEMENTS (continued) |
million | ||||||||||||||||||||||||
Cash flow statement Six months ended 30 June 2011 |
Unilever Capital Corporation subsidiary issuer |
Unilever(a) parent entities |
Unilever United States Inc. subsidiary guarantor |
Non- guarantor subsidiary |
Eliminations | Unilever Group |
||||||||||||||||||
Cash flow from operating activities |
| (131 | ) | (53 | ) | 2,607 | | 2,423 | ||||||||||||||||
Income tax paid |
| (56 | ) | (42 | ) | (454 | ) | | (552 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from operating activities |
| (187 | ) | (95 | ) | 2,153 | | 1,871 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Interest received |
62 | 32 | | 43 | (94 | ) | 43 | |||||||||||||||||
Net capital expenditure |
| (5 | ) | | (901 | ) | | (906 | ) | |||||||||||||||
Acquisitions and disposals |
| 4 | | (1,385 | ) | | (1,381 | ) | ||||||||||||||||
Other investing activities |
(1,345 | ) | 4 | (651 | ) | 1,009 | 940 | (43 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from /(used in) investing activities |
(1,283 | ) | 35 | (651 | ) | (1,234 | ) | 846 | (2,287 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Dividends paid on ordinary share capital |
| (1,105 | ) | | (115 | ) | | (1,220 | ) | |||||||||||||||
Interest and preference dividends paid |
(46 | ) | (70 | ) | (62 | ) | (120 | ) | 94 | (204 | ) | |||||||||||||
Change in borrowing and finance leases |
1,328 | 1,388 | (22 | ) | (59 | ) | (940 | ) | 1,695 | |||||||||||||||
Other movement on treasury stock |
| (42 | ) | (6 | ) | | | (48 | ) | |||||||||||||||
Other finance activities |
| | 836 | (1,044 | ) | | (208 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash flow from/(used in) financing activities |
1,282 | 171 | 746 | (1,338 | ) | (846 | ) | 15 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net increase/(decrease) in cash and cash equivalents |
(1 | ) | 19 | | (419 | ) | | (401 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at beginning of year |
| (2 | ) | (3 | ) | 1,971 | | 1,966 | ||||||||||||||||
Effect of foreign exchange rates |
1 | (17 | ) | | 177 | | 161 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at end of year |
| | (3 | ) | 1,729 | | 1,726 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a) | The term Unilever parent entities includes Unilever N.V. and Unilever PLC. Though Unilever N.V. and Unilever PLC are separate legal entities, with different shareholder constituencies and separate stock exchange listings, they operate as nearly as practicable as a single economic entity. Debt securities issued by entities in Unilever Group are fully and unconditionally guaranteed by both Unilever N.V. and Unilever PLC. |
22