Unilever sticks to targets

Dove soap to Magnum ice-cream group Unilever today said it was on course to hit its targets for 2003.

The Anglo-Dutch consumer giant said it was confident that earnings from its 400 leading brands – such as Flora margarine, Hellmann’s mayonnaise, Lipton tea and Knorr soups – would grow between 5% and 6% this year.

Based on its performance in the first two months of the year, the group said its core brands would achieve growth of around 4% to 5% in the first quarter.

Howard Green, head of investor relations, said the figure was slightly below that for the year as a whole because of “calendar effects” which should reverse later in the year.

The group, which will release figures for the first quarter of 2003 in May, stuck by an earlier target of “low double digit” growth in earnings per share.

Mr Green said the group anticipated EPS would grow by around 5% in the first quarter and margins would improve because of the group’s savings programmes.

Unilever launched a five-year “Path to Growth” strategy in 2000 which has led to sweeping change across the business.

Close to 700 brands have been sold off and the group has centred on a basket of 400 global names and “local jewels” such as Marmite in the UK.

Under the strategy the group is committed to delivering annual top line growth of 5-6%, operating margins before exceptional items and goodwill costs of more than 16% – compared to 11% at the start of Path to Growth – and low double digit earnings per share growth through to 2004.

It is estimated that the €5bn plan will reduce the group’s headcount by 25,000 over 5 years through site sales or closures, restructuring and natural wastage.