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Unilever Reports Q4, 2010 Full Year Financials
Posted: February 3, 2011
page 2 of 2
Unilever’s CEO Paul Polman said, “We are pleased with another year of good results in which we delivered against all our key priorities and further progressed the transformation of Unilever. We delivered strong volume growth, particularly in emerging markets, which continued to be the engine of growth. We gained volume share in all regions driven by stronger innovations, significant increases in marketing investment and the extension of our brands into new territories. At the same time we delivered margin improvement through a strong savings program, lower indirects and volume efficiencies. This, coupled with excellent working capital management, enabled us to deliver robust cash flow. The Unilever of today is more agile and confident, now fully fit to compete. We remain focused on serving our consumers and customers and building the long term health of our brands. Despite the intense competition and the return of commodity cost volatility, our objectives remain: profitable volume growth ahead of our markets, steady and sustainable underlying operating margin improvement and strong cash flow.”
As to specific world growth, in the Asia-Africa CEE region in 2010, Unilever grew ahead of the market and continued to gain volume share. Asia-Pacific delivered double-digit volume growth in the year with a strong fourth quarter. There were particularly strong performances in Vietnam, the Philippines, Pakistan and China. In India the company delivered consistent double-digit volume growth, and the business in North Africa, Middle East and Central Africa performed well throughout the year. While market conditions in Central and Eastern Europe were weaker, volume growth was still comfortably positive. In-quarter pricing for the region was positive in the fourth quarter.
In the Americas, the company gained volume share in 2010 and saw higher underlying sales growth driven by consistent growth in Latin America and good performance in North America. In the fourth quarter, North America accelerated volume growth to around 3% whilst Latin America balanced volume growth of more than 4% with increased price. While the U.S. economy remains difficult and increasingly competitive, Unilever’s business continued to benefit from its strong innovation program. The Brazilian market continues to grow strongly but remains highly competitive; in this context the company’s business delivered good results. Mexico had a particularly good year, gaining share in a number of key categories and the Southern Cone had another excellent year with a strong recovery in Chile after the devastating earthquake.
And in Western Europe, despite difficult markets, Unilever delivered volume growth and improved volume share in the year, with positive volume growth in the fourth quarter. Underlying price continued to improve but was still negative year-on-year reflecting the high levels of promotional intensity in many of the company’s markets. Conditions in Southern Europe remain particularly challenging. Northern Europe is more robust and the company saw strong performances in the U.K. and France.