Unilever Exceeds Market Expectations

A leap in profits in Europe and North America helped Unilever, the Anglo-Dutch consumer goods group, report third-quarter results well above market expectations in spite of flat turnover. Pre-tax profits rose 15 per cent to £934 million in the three months to September 30, the first period to exclude results from the speciality chemicals business sold to Imperial Chemical Industries in May for £4.9 billion. The markets saw the results as evidence of the success of the group in tackling its underperforming businesses and focusing on priority sectors and regions. The shares were up 12 1 /4p to 449 1 /2p in a falling market. The company is taking its commitment to shareholder value very seriously, said David Lang, food analyst at Henderson Crosthwaite. Unilever said it would now accelerate the pace of restructuring and take exceptional charges of £600 million for 1997, up from £237 million in 1996. The group, which has taken charges of £206 million in the first nine months of 1997, has said in the past it would write off about £250 million a year. This year, it will also write off up to £200 million in the fourth quarter, following a review of surplus and obsolete plant and equipment. These exceptional charges are before the exceptional profit of £3 billion from the sale of the chemicals business.