Unilever beats forecasts

February 14, 2002 Posted: 1317 GMT

LONDON (CNN) -- Unilever, the world's largest consumer goods group, on Thursday posted better-than-expected net profit for 2001 due to strong global sales.

The Anglo-Dutch giant said underlying 2001 net profit rose 12 percent to 3.6 billion  ($3.14 billion), at the top of analysts' expectations, as sales increased 11 percent to 53.4 billion. Pretax profit for 2001 was up 35 percent at 3.7 billion.

Chairman Niall FitzGerald said record strong growth continued last year, helped by sales at Bestfoods, which it bought in 2000. He said those gains came despite worsening economic conditions in markets like Japan and Argentina.

"We do not produce leading edge products. People still have to eat, wash and beautify themselves," said FitzGerald, adding the company still expects to meet it growth targets for 2002.

"We will hit our double-digit earnings target this year; the integration of Bestfoods is going extremely well. We are sustaining our leading brands growth. Margins are improving and cash flow is strong," he said.

Unilver's 400 brands – which accounted for 84 percent of sales -- include Hellmann's mayonnaise, Lipton tea, Magnum ice cream, Knorr soups, Omo detergent, Dove and Lux soap, and Close Up toothpaste.

"It's difficult to find too many quibbles in these numbers as they are at the top end of expectations and it's reassuring as Unilever is hitting its financial targets," one analyst.

Unilever shares dipped 1.7 percent to 580.5 pence in midday trading on Thursday in London.

In 2000, Unilever launched five-year strategy aimed at driving underlying annual sales growth to five to six percent and profit margins to above 16 percent by 2004 by focusing on its top 400 brands.

At the same time, the group has been cutting jobs, closing factories and

eliminating brands in an effort to push up sales and margins.

-- Reuters contributed to this report