Form 6-K

 

 

 

 

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 registrant’s 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 registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s 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 registrant’s 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


    LOGO    

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, Russia’s 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 Hellmann’s 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 & Jerry’s 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   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

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; Unilever’s global brands not meeting consumer preferences; increasing competitive pressures; Unilever’s 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 Group’s filings with the London Stock Exchange, Euronext Amsterdam and the US Securities and Exchange Commission, including the Group’s 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 Group’s 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
  

 

 

   

 

 

 

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   
  

 

 

    

 

 

    

 

 

 

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
  

 

 

    

 

 

 

Core profit attributable to shareholder’s equity

     2,208         2,071   
  

 

 

    

 

 

 

 

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   
  

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Price (%)

     3.5        4.2        4.3        4.5         4.1   

Volume (%)

     6.7        (1.0     5.3        0.3         2.8   
  

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

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   
  

 

 

   

 

 

   

 

 

   

 

 

 

Price (%)

     5.3        5.6        0.7        4.1   

Volume (%)

     5.4        2.0        0.3        2.8   
  

 

 

   

 

 

   

 

 

   

 

 

 

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   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

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   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

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
  

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

 

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 shareholder’s 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       
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     6,418         41,457        15,173        14,757        (44,330     33,475   
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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   
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
             7,574        1,857        6,540               15,971   
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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