Consumer spending, competition pressures Unilever

by Keith Nunes
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LONDON — Net income at Unilever fell 31% during 2009 to €3,569 million ($4,937 million), equal to €1.21 per share on the common stock, down from €5,285 million, or €1.79 per share, in fiscal 2008. The company attributed the decline to continued pressure on consumer spending and increased competition.

Sales for the year were €39,823 million ($55,049 million), a slight decline compared to the same period of 2008 when company sales were €40,523 million.

“We made good progress in challenging market conditions,” said Paul Polman, chief executive officer. “Our market share improvements were broad-based and improved throughout the year. Our brands are stronger, driven by better quality innovation and a step-change in advertising and promotional expenditure.

“We have further strengthened our leading positions in developing and emerging markets and made encouraging progress in re-establishing volume growth in Western Europe. The organization is moving fast towards a stronger performance culture. We are faster and more agile and focused on serving over 2 billion consumers every day.”

The company said its Savoury business showed “good growth” during 2009, led by the expansion of its Knorr brand in 13 markets. The company also said its Spreads business was competing in a challenging market, but that it gained market share in the United Kingdom, North America and Germany.

Unilever’s Tea business achieved double-digit growth, according to the company, due, in part, to the introduction of its Pyramid tea bags in the Asian and African markets.

Net income declined 24% during the fourth quarter of 2009 to €906 million ($1,252 million), equal to €0.30 per share, down from net income €1,189 million, or €0.41 per share in the same period a year ago.

Sales for the quarter were €9,659 million ($13,349 million), a 5% decrease compared with sales of €10,151 million during the fourth quarter of 2008.

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