LONDON — Unilever reported Thursday that fourth-quarter 2006 net profits swelled to 2.1 billion euros, or $2.7 billion at average exchange, versus 726 million euros, or $920 million, in the same quarter in 2005.
The increase was largely due to the sale of its European frozen-foods division, which was acquired by Permira in November for 1.2 billion euros, or $1.55 billion. Stripping out discontinued operations, profits in the quarter rose 30 percent to 898 million euros, or $1.16 billion. Sales were flat at 9.73 billion euros, or $12.54 billion. At constant exchange, sales were up 3 percent.
By region, turnover in Europe was flat at 3.62 billion euros, or $4.66 billion; in the Americas, it dropped 2.1 percent to 3.45 billion euros, or $4.45 billion, while Asia-Africa was up 1.8 percent to 2.66 billion euros, or $3.44 billion. On a like-for-like basis, sales were up 0.1 percent, 4.3 percent and 7 percent, respectively.
For the full year, Unilever’s net profits rose 26 percent at both current and constant exchange to 5.02 billion euros, or $6.3 billion, converted at constant exchange. Sales were up 3 percent in the year, to 39.64 billion euros, or $49.8 billion. The group’s 2006 operating margin hit 13.6 percent, up from 13.2 percent in 2005. However, stripping out one-off gains, the margin came in 0.3 percent lower than the previous year. For the year, Unilever’s sales in Europe were flat at 15 billion euros, or $18.84 billion; the Americas generated 13.78 billion euros, or $17.31 billion, an increase of 4.6 percent, while Asia-Africa reported growth of 5.7 percent to 10.86 billion euros, or $13.65 billion.
According to Patrick Cescau, group chief executive, “We expect to deliver underlying sales growth in 2007 within our 3 percent to 5 percent longer-term target range. Savings programs are expected to drive an improvement in operating margin to over 13.6 percent after charging restructuring costs of 0.5 percent to 1 percent of sales.”