During the year under review, the company's performance was second highest which resulted in profit after tax at Rs 1.6 billion. Sales and trading profit recorded nominal growth. Its EPS declined to Rs 120.29 from Rs 131.59 million in the preceding year. Its share of Rs 50 is trading at Rs 1500 which is 30 times of the par value.
The price/earning ratio is more than twelve times of the EPS evidencing high demand for this share which has been always considered blue chip. One of the factors for the high demand is also its high dividend profile.
For the year under review, the company's aggregate dividend pay out is Rs 126 per share for which the appropriation was in the sum of Rs 1.675 billion, which is the second highest dividend amount of the last seven years.
To improve the efficiency, profitability the company adopted several technologies and business process and such as implementation of the SAP APO, Demand Planning Tool, Total Productive Maintenance (TPM), Integrated Manufacturing Systems Certification, Using Web-based technology.
Unilever Pakistan Limited is a public limited company incorporated in Pakistan. Its shares are quoted on Karachi, Lahore and Islamabad Stock Exchanges.
It was listed at Karachi Stock Exchange in 1980. At present its ordinary share of Rs 50 is trading at Rs 1500 per share. During the last one year the price of the share from Rs 1278 to Rs 1635 per share.
Through its wholly-owned subsidiary, Unilever Overseas Holdings Ltd UK, Unilever PLC, a company incorporated in the United Kingdom, is the ultimate holding company of Unilever Pakistan Ltd.
Unilever Overseas Holdings Ltd UK owns 8.912 million paid up shares of the company which works out to 66.8% stake in the equity of the Pakistani subsidiary.
The company manufactures and markets spreads and cooking products, ice cream, beverages and home and personal care products.
The financial performance of the year was the second best in the history of the company, following the record year 2002 and resulted in the profit after taxation of Rs 1.6 billion (2002: Rs 1.7 billion).
Sales in terms of value at Rs 21.471 billion (2002: Rs 21.418 billion) and trading profit at Rs 6.794 billion (2002: Rs 6.735 billion) registered nominal growth by 0.2% and 0.8% respectively over the preceding year's figures.
The company has 4 district business segments: Spreads and Cooking Products, Ice cream, Beverages, And Home and Personal Care.
The largest business segment in terms of sales is beverages business which registered sales at Rs 8.895 billion (2002: Rs 8.478 billion) and constituted 41.4% of total sales and grew by 4.92% over the preceding year. The trading profit of this business increased by 11%. After a strong performance in 2002, the results of this business are quite significant. This is despite the fact that a reduction in import duty on tea, smuggling is still rampant, biting into the growth potential of the branded sector. Its two brands Lipton and Brooke Bond Supreme showed high presence through massive re-launches. On the one side new opportunities were tapped through the placement of vending machines (7000) and electric tugs (31,750) at key consumption points. On the other large incremental sales were achieved through "Lost key" activation in case of Brooke Bond Supreme and innovating packaging in case of Lipton and powerful new mix.
The second largest contributor to its overall sales is the business of Home and Personal Care. Its sales at Rs 7.485 billion (2002: Rs 7.462 billion) constituted 34.9% of company's sales but it registered nominal increase of only 3.1%.
Though its growth trend is almost flat but this business delivered second highest trading profit of Rs 2.927 billion 2003.
The leading brands of the company, all posted double-digit sales growth (Surf 11.9%, Sunsilk 21%, Fair and Lovely Cream 31%). But in this business, the sale performance in Personal Wash Soaps was not upto the mark.
The directors pointed out that price increases taken to offset higher material costs, combined with significant increase in smuggled soaps adversely impacted offtake for both Lux and Lifebuoy.
The company took corrective action to protect the market share and in the second half the declining trend started to reverse.
In case of Edible oil business of spreads and cooking products division, the company is assessing the possible option of disposal.
Its Wall's Ice Cream business has clearly established its market leadership. The year under review was also an excellent year for exports to Afghanistan.
The company promoted major export brands Lux and Sunsilk. This was achieved through a first ever visibility campaign comprising of billboards in major cities Kabul and Jalalabad.
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Performance Statistics (Million Rupees)
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31 December 2003 2002
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Share Capital-Paid-up: 669.48 669.48
Reserves & Profit: 439.93 515.11
Shareholders Equity: 1,109.41 1,184.59
Surplus on Revaluation
Of Fixed Assets: 19.37 20.13
Deferred Taxation: 71.57 42.68
Staff Retirement Benefits: 81.09 82.45
Current Liabilities: 5,539.51 5,872.54
Tangible Fixed Assets: 1,444.88 1,513.19
Intangible Assets-Trade Marks: - 0.03
L.T Loans: 87.54 42.78
L.T Deposits & Prepayments: 97.25 126.25
Investments: 95.20 95.20
Deferred Cost: 137.20 205.80
Staff Retirement Benefits: 155.91 92.82
Current Assets: 4,802.97 5,126.32
Total Assets: 6,820.95 7,202.39
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Sales, Profit & Pay Out
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Sales: 21,471.72 21,418.53
Trading Profit: 6,794.79 6,735.06
Operating Profit: 2,606.45 3,033.47
Other Income: 255.64 180.99
Financial (Expenses): (79.04) (139.31)
(Depreciation): 282.27 280.18
Profit Before Taxation: 2,520.88 2,695.06
Profit After Taxation: 1,599.33 1,749.56
Dividend Cash @Rs 126
(2002: @Rs 138) Per Share: 1,675.03 1,834.55
Earnings Per Share of Rs 50: 120.29 131.59
Share Price (Rs) on 08.06.2004: 15.00 -
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Financial Ratios
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Price/Earning Ratio: 12.47 -
Book Value Per Share: 83.15 88.79
Price/Book Value Ratio: 12.46 -
Debt/Equity Ratio: 0:100 0:100
Current Ratio: 0.87 0.87
Asset Turn Over Ratio: 3.15 2.97
Days Receivables: 8 4
Days Inventory: 65 48
Trading Profit Margin (%): 31.65 31.44
Net Profit Margin (%): 7.45 8.17
R.O.A (%): 23.45 24.29
R.O.C.E (%): 124.81 131.56
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Annual Production (000' Metric Tons)
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Spreads & Cooking Products: 64.72 65.38
Beverages: 46.05 43.74
Home & Personal Care: 48.10 53.78
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