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2005 Unilever Annual Review and
Summary Financial Statement
Our corporate purpose

Unilever’s mission is to add vitality to life. We meet everyday needs for nutrition,
hygiene and personal care with brands that help people feel good, look good and
get more out of life.
Our deep roots in local cultures and markets around the world give us our strong
relationship with consumers and are the foundation for our future growth. We will
bring our wealth of knowledge and international expertise to the service of local
consumers – a truly multi-local multinational.
Our long-term success requires a total commitment to exceptional standards of
performance and productivity, to working together effectively, and to a willingness
to embrace new ideas and learn continuously.
To succeed also requires, we believe, the highest standards of corporate behaviour
towards everyone we work with, the communities we touch, and the environment
on which we have an impact.
This is our road to sustainable, profitable growth, creating long-term value for our
shareholders, our people, and our business partners.

The two parent companies, Unilever N.V. (NV) and in Dutch guilders, which have not been converted into are they guarantees of future performance. Because these
Unilever PLC (PLC), together with their group companies, euros in NV’s Articles of Association. Until conversion formally forward-looking statements involve risks and uncertainties,
operate effectively as a single economic entity (the Unilever takes place by amendment of the Articles of Association, the there are important factors that could cause actual results to
Group, also referred to as Unilever or the Group). This Annual entitlements to dividends and voting rights are based on the differ materially from those expressed or implied by these
Review therefore deals with the operations and the results of euro equivalent of the underlying Dutch guilders according forward-looking statements, including, among others,
the Unilever Group as a whole. The Unilever Annual Review to the official euro exchange rate. competitive pricing and activities, consumption levels, costs, the
and Annual Report and Accounts is produced in Dutch ability to maintain and manage key customer relationships and
and English. The term shares as used in this document should, supply chain sources, currency values, interest rates, the ability
with respect to shares issued by N.V. be construed to to integrate acquisitions and complete planned divestitures,
The brand names shown in italics in this Annual Review include depositary receipts for shares issued by Stichting physical risks, environmental risks, the ability to manage
are trademarks owned by or licensed to companies within Administratiekantoor Unilever N.V., unless the context regulatory, tax and legal matters and resolve pending matters
the Unilever Group. otherwise requires or unless it is clear from the nature within current estimates, legislative, fiscal and regulatory
of the notification that this is not the case. developments, political, economic and social conditions in the
Unilever has adopted the euro as its principal reporting geographic markets where the Group operates and new or
currency. The figures in this Annual Review are expressed The exchange rates used in the preparation of this changed priorities of the Boards.
in euros with translations, for convenience purposes, into Annual Review are given on page 28.
sterling and US dollars. Further details of potential risks and uncertainties affecting the
Cautionary statement Group are described in the Group’s filings with the London
In the following commentary, sales growth is stated on an This document may contain forward-looking statements, Stock Exchange, Euronext Amsterdam and the US Securities
underlying basis at constant exchange rates and excluding including ‘forward-looking statements’ within the meaning and Exchange Commission, including the Annual Report and
the effects of acquisitions and disposals. For further of the United States Private Securities Litigation Reform Act of Accounts on Form 20-F. These forward-looking statements speak
information, please refer to our website at 1995. Words such as ‘expects’, ‘anticipates’, ‘intends’ or the only as of the date of this document. Except as required by any
www.unilever.com/investorcentre negative of these terms and other similar expressions of future applicable law or regulation, the Group expressly disclaims any
performance or results and their negatives are intended to obligation or undertaking to release publicly any updates or
For NV share capital, the euro amounts shown in this identify such forward-looking statements. These forward- revisions to any forward-looking statements contained herein
document are representations in euros on the basis of looking statements are based upon current expectations and to reflect any change in the Group’s expectations with regard
Article 67c of Book 2 of the Civil Code in the Netherlands, assumptions regarding anticipated developments and other thereto or any change in events, conditions or circumstances
rounded to two decimal places, of underlying share capital factors affecting the Group. They are not historical facts, nor on which any such statement is based.

| 1 Unilever Annual Review and Summary Financial Statement 2005

Contents

02 04 06
Financial highlights Unilever at a glance Chairman’s foreword
of the year Foods and Home and personal care brands
08

Q&A
in more than 100 countries worldwide

Group
Chief Executive

12 13
Innovation across Committed
our business to operating
Embracing vitality at the
core of our brands
responsibly

22
16 Corporate Governance
Regional review
Overall market share has been 23
stabilised in Europe, while
The Americas and Asia Africa Competing more
enjoyed more competitive,
volume-driven growth
effectively through
our people
26
Board of Directors
28
Summary
financial statement
32
Summary
remuneration report
37
Shareholder information
Financial highlights of the year

Turnover Operating profit Dividends (1)

€ million € million € per €0.51 Ordinary share of NV(2)

2005 39 672 2005 5 314 2005 1.98

2004 38 566 2004 4 239 2004 1.89

£ million £ million pence per 1.4p Ordinary share of PLC(2) (3)

2005 27 124 2005 3 633 2005 20.31

2004 26 151 2004 2 876 2004 19.15

$ million $ million $ per €0.51 New York share of NV(2)

2005 49 352 2005 6 611 2005 2.37

2004 47 744 2004 5 249 2004 2.42

$ per 5.6p American Depositary

Receipt of PLC(2) (3)

2005 1.42
2004 1.43

(1)
Dividends for each year comprise dividends declared
or proposed for that year. Under IFRSs*, dividends
are only recorded against the year in which they
become payable.
(2)
Rounded to two decimal places
(3)
Actual dividends payable for 2005 on NV New
York shares and American Depositary Receipts
of PLC may differ from those shown above, which
include final dividend values calculated using the
rates of exchange ruling on 8 February 2006
(€1.00 = $1.1948, £1.00 = $1.7427).

* With effect from 1 January 2005, Unilever has adopted International Financial Reporting Standards (IFRSs) as adopted by the EU, with a transition date of 1 January 2004.
For further details of this change please refer to page 29.

2 | 3 Unilever Annual Review and Summary Financial Statement 2005

 %

• Unilever’s total dividend increased

+3.1
Underlying sales
by 5% (NV) and 6% (PLC). up 3.1%
• Market shares stable overall.
• Earnings per share up 37%, with
22% from continuing operations,
benefiting from lower restructuring,
disposal and impairment charges.
• Increased investment behind
growth priorities, including
additional €500 million on advertising
and promotions.
• Operating margin at 13.4%.
Productivity improvements and
better mix more than offset
higher input costs.
Unilever at a glance
With strong local roots in more than 100 countries across the globe, Unilever has a
powerful portfolio of Foods and Home and personal care (HPC) brands. This includes
twelve €1 billion brands and global leadership in many categories in which the company
operates. Below are some of our innovations in 2005.

Foods

Knorr continues to break

new ground. The latest
example of this is its healthy
fruit and vegetable mini shots
Europe

which help you on your

way to your daily fruit
and vegetable needs.

Bertolli has brought the

authentic taste of Italy
The Americas

to frozen meals with

its gourmet-standard
Dinners for Two.

The innovative redesign

of the packaging of Brooke
Bond in India made the
Asia Africa

brand more relevant to

local consumers.

4 | 5 Unilever Annual Review and Summary Financial Statement 2005

Home and personal care

Sunsilk new hair colour

enhancement range in
Europe was designed to
increase the brand’s appeal
among young consumers.

all Small and Mighty

concentrated liquid
detergent in the US,
the first of its kind and
a major space saver
for retailers.

The launch of Pond’s

whitening platform
underlined Unilever’s
strength in the face care
category across Asia.
Chairman’s foreword
2005 was the first year when Patrick and I worked together as respectively
Group Chief Executive and Chairman. I've been delighted with how successfully
our combination has developed.

I’d like to congratulate Patrick and his

Executive, as well as all the staff at Unilever,
“It was one of the between both parent companies. This
will ensure that the Group continues to
for the progress made during the year.
Although there is still work to do to release
most exhaustive be able to return capital to shareholders
and pay dividends in the most efficient
the full growth potential of our powerful
portfolio of brands, the business has
and thorough manner. To simplify the relationship between
our NV and PLC shares, and provide
stabilised its aggregate market share,
a key objective in 2005.
reviews that I have greater transparency, we also propose
establishing a one-to-one equivalence in

To ensure the business has the best

seen undertaken.” their underlying value by splitting the NV
shares and consolidating the PLC shares.
structure and governance processes to Finally, we intend to allow shareholders
deliver long-term shareholder value in the While this conclusion might seem somewhat the right to nominate candidates to the
top third of our peer group, I set myself unexpected in an age of constant change, Boards, taking into account the need to
three objectives at the start of last year. it is totally consistent with the review’s three ensure the unity of management. Details
These were reviewing Unilever’s dual guiding principles. The current structure of all these changes are set out in the
NV/PLC structure, evaluating its corporate has been and still serves as a framework Notices convening the AGMs.
governance procedures and preparing by which we can benefit from the best of
for a series of Board departures over the many cultures and influences. Board succession
next couple of years. As I mentioned earlier, one of my objectives
Moving to a unitary structure would not was to prepare for Board succession. Three
Dual structure strengths only be costly and disruptive to the business Non-Executive Directors will be retiring in
The review of Unilever’s structure, which but in our case would not yield the material 2006 – Bertrand Collomb, Oscar Fanjul and
I led with the support of two Non-Executive advantages to justify it. As a result of changes Hilmar Kopper. I would like to thank them
Directors, as well as a team of leading made to our Boards and leadership for their enormous contribution over the
independent financial and legal advisers, structures at the beginning of 2005, Unilever years. This presents us with both a challenge
involved over six months of hard work. already has operational and governance and an opportunity to re-populate the
As one independent adviser commented: unity, with a single Chairman, a single Boards with new members who can build
“It was one of the most exhaustive and Board with a majority of Non-Executive on our retiring members’ strengths and
thorough reviews that I have seen Directors, a single Group Chief Executive help take Unilever forward.
undertaken.” and one Executive team. The current
structure does not hinder the operation of After a thorough search I am pleased to
Three important principles guided the review. the business, its decision making ability or announce the nomination of four new
First, Unilever’s commercial operations should organisational efficiency. Unilever might also Non-Executive Directors, all with extensive
be advanced and not prejudiced by any in moving to a unitary structure lose some financial and business experience, to take
change. Second, any change should have of the fiscal flexibility that it has under its over from the Board members retiring this
tangible benefits for shareholders. Lastly, any dual structure. year and Claudio Gonzalez who retired at
change should improve transparency and the 2005 AGMs. These are Charles Golden,
flexibility. These principles were designed Changes Executive Vice President and CFO of Eli Lilly
to ensure that any resulting structure serves This does not mean, of course, that we and Company, Byron Grote, CFO of BP p.l.c.,
the best interests of both the business and cannot improve our existing arrangements. Jean-Cyril Spinetta, Chairman/CEO of Air
our shareholders. The Boards will be proposing to shareholders France-KLM S.A. and Kornelis (Kees) Storm,
at the May 2006 AGMs three changes to former Chairman of the Executive Board
Based on these criteria and an in-depth enhance the balance sheet and capital of AEGON N.V.
analysis, the Boards unanimously concluded structure flexibility, as well as strengthen
that Unilever’s current dual structure, with elements of its corporate governance. We engaged the services of two highly
some important changes, meets the needs reputable independent search firms to help
of the business for the foreseeable future. These include adapting Unilever’s us in this task and they are also leading
constitutional arrangements to allow the evaluation of potential candidates
greater flexibility for allocating assets to succeed me as Chairman in 2007.

6 | 7 Unilever Annual Review and Summary Financial Statement 2005

 Review of
Unilever’s Structure

Governance study Based on an in-depth analysis. The Boards

During 2005, we also commissioned unanimously concluded that Unilever’s
a review of Unilever’s governance current dual structure, with some important
arrangements to ensure that these were changes, meets the needs of the business
best in class. for the foreseeable future.

The proposed changes are:

The review was conducted by independent
consultants who concluded that our • To adapt Unilever’s constitutional
arrangements stood comparison with our arrangements to allow greater flexibility
peers. A full report was made to the Boards to allocate assets between both parent
in the first quarter of 2006 and a range companies. This will ensure that Unilever
of minor changes in terms of the day to day continues to be able to return capital
operation of the Boards will be introduced to shareholders and to pay dividends
during the balance of the year. in the most efficient manner.

• To simplify the relationship between

A particular pleasure for me this year
our NV and PLC shares by establishing
has been to work with our social and a one-to-one equivalence in their
environmental partners, for example with economic interest in the Unilever Group.
UNICEF’s Child Nutrition programme and This will create transparency between
the World Business Council for Sustainable the quotations of our shares and will
Development. Ensuring the vitality of the be achieved by a split of the NV shares
societies and environments in which we and a consolidation of the PLC shares.
operate is essential for Unilever to sustain
its long-term growth. • To allow shareholders the right to
nominate candidates to the Boards,
taking into account the need to
It is good to see that the many changes
ensure the unity of management.
that were initiated over the last 12 months
have not impeded the progress of Unilever The Boards will be proposing resolutions
in the market place. All this progress would in relation to these changes to shareholders
not be possible without the commitment at the AGMs in 2006.
and the hard work of all our 206 000
employees. Without their dedication we
could not add vitality to the lives of our
consumers across the globe. On behalf
of the Boards I would like to convey my
thanks to all of them.

Antony Burgmans
Chairman
Group Chief Executive
Here Patrick Cescau, Group Chief Executive, talks about
performance in 2005 and looks ahead to what needs
to be achieved over the next 12 months.

Q&A
Q: What was the key challenge
for 2005?
“Our mission is to
A: At the start of 2005 it was clear what
we had to do. We had to restore our
help people feel good,
competitiveness in the market and get
the business growing again.
look good and get
But we had to do it in a way that we can
more out of life
sustain for the long-term, creating value
and unlocking our full potential.
and this underpins
Q: How did you set about tackling
everything we do”.
this challenge?
A: Our approach was simple – to focus Q: Overall, what results have been
on three things that matter. achieved by following this approach?
A: We have made real progress. In 2005
First, to make our portfolio work harder underlying sales growth was 3.1%,
for us, with sharper priorities and resource significantly ahead of a flat 2004, and in
allocation. Secondly, better execution, line with our markets. Growth momentum
especially in the areas of marketing and has improved steadily throughout the year
customer management. And, finally, create and has been driven by volume.
a more agile ‘One Unilever’ organisation,
aligned behind a single strategy, with the I’m also pleased to report that our growth
right people in the right jobs, delivering rates improved across most of our major
quality and speed of execution. markets and in most categories. These
figures are a real testament to the hard
Q: What were the priorities and work of our people, the strength of our
why did you focus on these areas? brands and the resilience of our business.
A: We focused on building on our strengths
in developing and emerging (D&E) markets, Restoring growth required a step up in
vitality and Personal Care. They are areas investment behind our brands. In 2005,
of strength for Unilever where we have we invested an extra €500 million in
performed well, with good growth and advertising and promotions. We also
profitability. invested significantly to reduce prices,
especially in Europe, and offer better
Regaining momentum in Europe was an value to the consumer in selected
equally important priority. categories and markets.

Our savings programmes generated more

than €700 million in 2005 and helped
fund the additional investment in our
brands and absorb the impact of higher
input costs.

Q: Why has Personal Care played

a key role in the strategy?
A: Personal Care is one of our traditional
strengths and accounts for around a
quarter of sales, so it was vital we delivered
real growth.

8 | 9 Unilever Annual Review and Summary Financial Statement 2005

 The Unilever Executive –
closer to the marketplace

Over the last year or so, Personal Care The Unilever Executive (UEx), headed by Group Chief
has been achieving growth levels that are Executive Patrick Cescau, is the top management team
up with the best at more than 6%. And within the Group. The Group Chief Executive is
we have delivered broad-based share gain accountable for all aspects of Unilever operations,
across most of our biggest markets and managing business performance and overall profit
strong profitability. responsibility for the Group.

Key to this success are our brands. The UEx team comprises three regional presidents
The big global brands such as Axe, Dove, (The Americas, Asia Africa and Europe), two category
Lux, Rexona and Sunsilk all performed presidents (Foods and HPC), the Chief Financial Officer
and delivered growth. Smaller, more local and the Chief Human Resources Officer.
brands such as Clear and Lifebuoy also
pulled their weight. The categories and regions have distinct but
complementary roles. The regions are responsible for
Q: What role has vitality played in profit, implementing proven brand mixes in their region
the progress that’s been achieved? and single-mindedly focused on growth through
A: Vitality unites us as a mission and excellent go-to-market execution. The categories are
resonates with our customers and responsible for category strategy and brand development
consumers. (including R&D and innovation).

Our mission is to help people feel good, The interdependence between the regions and the
look good and get more out of life and categories allows us to capitalise on our global scale
this underpins everything we do. while building on our deep roots in local markets.

It is the inspiration for innovations that are Finance and HR ensure excellence in their functional
driving growth across the entire product areas and provide support to the regions, categories
portfolio. Lipton and AdeS – healthy and and Corporate Centre.
refreshing beverages; Dove – the Campaign
for Real Beauty; and healthier choices in In 2005, Unilever’s executive management completed
ice cream. the successful transition to become a smaller, more
focused team, closer to the market and able to make
In Foods, for instance, our Knorr Vie mini speedier decisions.
shots, which help you on your way
towards your daily fruit and vegetable The current members of the UEx, as photographed on this page,
are (from the top):
needs, have done extremely well in Europe.
We have revitalised Lipton in the US by
• Group Chief Executive, Patrick Cescau
stressing its natural health benefits with • Chief Financial Officer, Rudy Markham
its ‘AOX’ antioxidant seal, and this has • President Asia Africa, Harish Manwani
produced good share gain especially in • Chief Human Resources Officer, Sandy Ogg
the ready-to-drink market. • President Home and personal care, Ralph Kugler
• President Europe, Kees van der Graaf
• President The Americas, John Rice
In HPC, our Dove campaign for Real Beauty, • President Foods, Vindi Banga
which offers consumers a broader, healthier
view of female beauty, has played a central
role in the brand’s continued growth, while
programmes to encourage hygienic
handwashing in India have improved sales
of Lifebuoy.
Group Chief Executive continued

Q: You mentioned developing and Western Europe is an extremely tough And we intend to get more out of the
emerging markets. Why are these so competitive environment and to turn the investment in our brands whether it be
important to Unilever? business around we are having to do things in advertising or in R&D.
A: D&E are rapidly growing markets – the differently. We have addressed pricing in
forecast is that they will account for 90% selected markets and categories and by Q: In 2004 you announced ‘One
of the world’s population by 2010. We doing so are now offering consumers Unilever’ as a way of simplifying the
have long-established local roots in these better value. business and generating savings. Has it
markets which gives us a competitive achieved this?
advantage and we need to capitalise We are also increasing choice by extending A: Our ‘One Unilever’ programme is all
on this opportunity. our product portfolio – ice cream value about making us fit to compete. It has
ranges, for example, and by moving into achieved a great deal in simplifying
In 2005 we delivered a strong performance a wider range of channels. And we are our business and leveraging our scale
in all major D&E markets in Foods, Home delivering innovation – new heart health more effectively.
Care and Personal Care. And for the first ranges and Sunsilk styling are just two
time, our D&E sales, at 38%, exceeded examples, which are being backed by We have merged our operations in countries
our sales in Western Europe. increased marketing investment. so that, at the end of 2005, almost 80%
of our turnover is managed through ‘One
The reason for our success here is partly Unilever’ organisations.
due to our well-established distribution
strength in both the traditional and modern
“Our ‘One Unilever’ We will continue with its implementation
trade and also to our ability to adapt
excellent global brand concepts, such
programme is all in 2006 with our priorities being to put in
place a single management team in all
as the Omo ‘Dirt is Good’ campaign, to
local markets. In Turkey, for instance, this
about making us markets. Most of our top 20 markets
report directly to UEx. There will be a further
enabled us to regain market leadership
with double-digit growth.
fit to compete.” reduction in the management headcount
and simplified, standardised business
services up and running, with a substantial
Q: But what has been achieved in Q: What are you doing to build proportion outsourced.
Europe and North America? capabilities across the business?
A: Our sustained recovery in the US is A: This is another area we are investing in. By the end of 2006, ‘One Unilever’ will
great news for us. In one of the world’s Customer management is a strategic deliver €700 million savings and €1 billion
most competitive markets we grew by priority and our team is implementing an by the end of 2007. But the biggest benefit
3.2% with strong performances from improvement programme market by for us is that we now have ‘one face’ for
both Foods and HPC. market, with outstanding results. our customers and consumers, as well as
being faster and more disciplined. In other
Europe has been an area that needed our An important element of this programme words we are fit to compete.
attention. A healthy European business is combining our Foods and HPC sales teams
matters to Unilever. It delivers a large so that we can present a single, integrated Q: What is driving the decisions you
proportion of our sales – 41% in 2005 – face to our customers and leverage our are making relating to the portfolio?
and is an important source of profit. scale. The programme developed in the A: In 2005 we reviewed and sharpened our
USA has been rolled out in France, portfolio strategy. It is an essential building
Looking at our performance, Central and Germany and the Netherlands and will be block that gives us clarity – it identifies the
Eastern Europe performed strongly in 2005 extended to other markets in 2006. best opportunities for sustainable long-
with Russia, for example, delivering around term growth, enables us to make choices
20% growth. So the challenge is Western By working closely with our customers such and to allocate resources according to
Europe. And the issue here is growth, as Carrefour, Tesco and Wal-Mart we are those choices. It then allows us to drive
not profitability. increasing the value that we can gain by disciplined execution.
doing business together.
We had to take decisive action on parts
We are also improving our marketing of our portfolio where we had reached
capabilities. For example, we will craft a strategic cross-roads.
more of our global brand mixes to the
standards set by the best of our brands.

10 | 11 Unilever Annual Review and Summary Financial Statement 2005

 Unilever’s change
agenda

“Our number one Q: Unilever is now in better shape, with

increased competitiveness and growth.
Unilever’s change agenda focuses on the
things that matter for unlocking Unilever’s
priority in 2005 was What’s your summary of 2005?
A: We have achieved a tremendous amount
full potential.

restoring growth. in 2005 – organisational change, improved

capabilities and restored growth. Our
• Making our portfolio work harder
by channelling our resources to build
In 2006, it is to people have much to make them proud. more leadership positions in key
markets and a more powerful
sustain our growth The Unilever team has worked together to
create a momentum that will help us rise
presence in higher growth spaces.

and improve to the challenges of the year ahead. There

is still a great deal to do, but we know the
• Building capabilities. Ensuring that
we are excellent in marketing and
our margins.” categories segments, brands and countries
that will drive growth. And we are now
customer management, not just in
parts of the business but everywhere.
rigorously deploying our funds and
The sale of UCI (Unilever Cosmetics resources behind our best opportunities. • Fit to Compete. Creating a simpler,
International) and the recent announcement more agile ‘One Unilever’ organisation,
of our intention to sell the majority of our We have the right structure to deliver and aligned behind our strategy, with the
European frozen foods business were tough the processes in place to make sure that we right people in the right jobs and
decisions. We made them because it was execute against our priorities. Our people capable of leveraging Unilever’s scale
clear we would not be able to grow these are clear about what they need to do. more effectively.
businesses in the long-term which is
fundamental to future value creation. We We will build on what we achieved in 2005 Our number one priority in 2005 was
felt we had better opportunities to invest in and deliver the results we have promised for restoring growth. In 2006, it is to sustain
and that these businesses would perform 2006. This will unlock more of the unique our growth and improve our margins.
better in the hands of owners to whom potential of Unilever. I passionately believe
they were a top priority. that we can now compete to win.

As we move forward we will continue

to invest behind our best growth
opportunities, channelling more of our
resources into building leading positions
in high growth areas.

Q: Continuing to look forward, what are

your priorities for 2006 and beyond?
A: Our priorities will not change. We will
continue to build on the stronger focus we
now have. UEx believes that the portfolio
is in good shape; all parts of our business
have an important role to play in delivering
growth, but it’s not always the same role.

Obviously I can’t disclose all our intentions

in detail. But I would like to give you some
insight into our priorities for 2006.

You will not be surprised to hear that our

plans include capitalising on the high-growth
potential of D&E markets such as China,
India and Russia. Or that in Personal Care,
we will be building on our leading market
positions in deodorants and personal wash.
And that vitality will continue to be at the
heart of our innovation programme.
Innovation across our business
Foods

Improving quality Highlights

Vindi Banga Improved quality has been another theme
President Foods of our innovations, reflected in the launch • The growth of healthier innovations,
of our gourmet-standard Bertolli Dinner for such as Becel/Flora pro.activ and Knorr Vie,
Two frozen range, a major success in the is a direct result of our vitality strategy.
US. Knorr has also produced exceptional
results in the Netherlands and other • We completed our nutritional
European countries with its new, high- enhancement programme. Over 16 000
quality wet soups in pouches (also sold as products have been assessed for levels
Unox), as has our ice cream business with of trans fats, saturated fats, sodium and
its new and intensely flavoured Magnum sugars, and, where necessary, action has
Five Senses. been taken to reduce them.
Embracing vitality
We’re embracing vitality at the core of Greater affordability • Our R&D has been restructured to
our Foods brands, ensuring they deliver For developing and emerging markets, operate as a single, integrated
the nutritional and health benefits that we’ve continued to make our products organisation, enabling us to leverage
consumers are increasingly demanding, more affordable through packaging and our global scale and allocate resources
as well as that essential ingredient for price-per-serving with pioneering products more productively.
success – great taste. such as Knorr Cubitos seasoning cubes
(see page 22).
Becel/Flora pro.activ is a case in point.
Originally launched as a spread to help Healthier ways to eat out of home
people reduce their cholesterol, Becel/Flora While consumers increasingly look for ways
pro.activ has extended rapidly into a range to eat healthily out of home, they are not
that includes milk drinks, yoghurt products willing to sacrifice taste and convenience.
and minidrinks. It’s no longer just about This often challenges foodservice operators
cholesterol either, as there’s now a mini- to offer food that meets all the needs of
drink to help people control blood pressure. their customers. Our Unilever Foodsolutions
In fact, the brand has proved so effective business gives foodservice professionals
in improving heart health, as part of a products that deliver delicious taste,
balanced diet, that the Netherlands’ consistent quality, convenience and
largest health insurer, VGZ, is rewarding healthier menu options.
its policy holders financially when they
buy Becel/Flora pro.activ products. In 2005 we launched Knorr Coulis, a new
innovative range of pure sauces made from
To help consumers meet their daily freshly mashed vegetables. To be used
nutritional requirements, we also launched as a warm or cold sauce or as a natural
Knorr Vie mini shots in Europe. Free of ingredient, Knorr Coulis creatively refines
preservatives and other additives, these and decorates all types of dishes. With its
convenient natural drinks help you on your pure, high quality ingredients, its fresh
way towards your daily fruit and vegetable authentic taste and exciting colours it is
needs. Other advances included new fruit a solution that brings chefmanship and
variants of our nutritionally rich, soya-based vitality naturally together.
drink, AdeS, in Latin America. Like so many
of our brands that have embraced vitality,
AdeS has proved a success and will be
extended to other markets. Our dedicated
new vitality platforms group are actively
creating numerous future opportunities In the US, Lipton is emphasising
such as the ones mentioned above. tea’s natural health benefits,
including antioxidants, which
Scientifically-validated claims has produced double-digit
In all cases, whether we’re communicating growth and increased its share
the health benefits of Lipton tea or the of the ready-to-drink market.
vitality credentials of Hellmann’s, we only
make health and nutrition claims for our
brands that are supported by robust,
scientifically-validated evidence. This
approach is underpinned by a strict claims
guidance framework, as well as a
commitment to make nutritional
information available to consumers.

12 | 13 Unilever Annual Review and Summary Financial Statement 2005

 Committed to
operating responsibly
Lipton has brightened We seek to manage and grow our business
around the world in a responsible and
up its performance by sustainable fashion. The values and standards
by which we expect to be judged are set
highlighting the brand’s out in our Code of Business Principles.

health benefits. We aim to share these standards and values

with our suppliers and contractors through
our Business Partner Code which, in turn,
is based on our Code of Business Principles.
It sets out standards on ten key points of
business integrity, labour standards, consumer
safety and the environment.

The long-term success of our business is

intimately linked with the vitality of the
environment and the communities in which
we operate. More than two-thirds of our
raw materials come from agriculture, while
water and other natural resources play an
equally critical role in our business. To ensure
we protect these key resources, we have
clear, long-term eco-efficiency objectives and
targets for our manufacturing operations,
as well as three sustainability initiatives on
water, agriculture and fish.

Over the last ten years, we have continued

to improve our eco-efficiency performance
across all of our seven key environmental
parameters which we use to measure the
emissions from our factories and set future
reduction targets. In 2004 (latest available
figures) we continued to improve on our
2003 performance but did not meet all
our targets.

The strength of our commitment to

sustainability is reflected in the fact that we
remain the leading food company in the
Dow Jones Sustainability World Index.

In 2005 we spent around €79 million on our

voluntary initiatives in communities around
the world. This increase on our 2004
contribution of €65 million is partly due to
the overwhelming response of our business
to the plight of the December 2004 Asian
tsunami victims.

On the following pages you will find

examples of our commitment to running
a responsible business. More information
can be found on our website at
www.unilever.com/ourvalues
Innovation across our business continued
Home and personal care

Reinvigorating Home Care Highlights

Ralph Kugler Innovation has reinvigorated our laundry
President Home business. The Omo ‘Dirt is Good’ campaign • The success of all Small and Mighty liquid
and personal care
was rolled out across most of Asia after its detergent has underlined the power of
launch in Latin America and Europe, giving stronger relationships with our customers.
us near global coverage. In Europe, we
introduced a new gel-layered detergent • Dove and Rexona extended their
tablet that helped make Skip the fastest leadership with launches such as Dove
growing HPC brand in France by the end of Cool Moisture and Rexona ‘teens’.
2005. A new whiteness shading technology
in Latin America gave consumers more • Technological breakthroughs have
appealing whites with Radiant. The spearheaded the recovery of our Home
Embedding vitality proprietary technology behind the innovation Care business, as well as hair in Asia.
Vitality is now central to our HPC business. is ensuring we keep ahead of our key
competitors. In North America, all Small and • To make greater inroads in the US skin
The Dove Campaign for Real Beauty, Omo Mighty is leading the concentrated liquid market, we opened a new $23 million
‘Dirt is Good’ and Lifebuoy Handwashing detergent market. Its success illustrates R&D facility in Connecticut.
campaign in Asia are tangible programmes how great mixes, which have both a
that bring Unilever’s vitality mission to life consumer-winning innovation and a strong
in our HPC brands. customer benefit, can be successful. In
China, we continued to develop the fabric
The success of Lifebuoy in India and conditioners market where Comfort is the
Indonesia contributed to the performance market leader.
of our skin business in Asia, as did the
launch of Pond’s whitening platform, The level of innovation in household care
which underlines Unilever’s strength in has been equally creative. Cif, for example,
the face care sector across Asia. rolled out pioneering power cream sprays for
the bathroom and kitchen. The traditional
Energising Personal Care offer to the consumer of cream from Cif
The new Dove Cool Moisture range was has now been enhanced with an attractive
launched in North America while the Dove new proposition with the same power of
firming range was rolled out globally. the Cif cream in a spray. Domestos,
We also extended the Dove Campaign meanwhile, extended its ‘kill germ’ power
for Real Beauty with the creation of the into a new territory with the sink and drain
Dove Self-Esteem Fund for young women unblocker which now clears blockages up
to educate and inspire girls on a wider to twice as fast as the market leader.
definition of beauty.

In South Africa we relaunched Vaseline with

a range of lotions and creams aligned with
the new global packaging. We also launched
South Africa’s first mass-market male lotion,
new Vaseline ‘For Men’.
With its unique clean-rinse
To grow our share of the male grooming formulation and extracts of
market, we launched Axe shower gel in cucumber and green tea,
North America. Within just three years, our new Dove Cool Moisture
Axe has become the leading deodorant range has attracted new
brand in the US. We also launched Rexona consumers to the brand.
Sport for Men with an award-winning
advertising campaign called ‘Stunt City’.
Rexona is now the number one male
deodorant brand in Russia and Ukraine.

In hair, the new Sunsilk colour enhancement

range in Europe has been designed to
increase the brand’s appeal among young
consumers. In oral care, the world’s first
centre-filled gel toothpaste was introduced
in Vietnam.

14 | 15 Unilever Annual Review and Summary Financial Statement 2005

We’re refreshing our brands Winning with health awareness
programmes
with smart, consumer-led Our Close Up toothpaste brand launched
Project Smile to bring much-needed oral
innovations and enjoying the health care products and advice to people
in rural Nigeria where only about 60% of
benefits, as Dove has shown. the population use toothpaste. The campaign
involved retailers of all sizes, including the
very smallest, as partners. We created
branded kiosks – tiny shops – to promote
Close Up and these gave an opportunity
to unemployed young people to make a
living by creating new long-term outlets,
as well as offering existing retailers a way
to showcase their wares.

The success of the campaign meant it was

quickly extended into towns and cities and
over the year, sales rose by 35%.

Sharpening our edge in raw materials

Ensuring a sustainable supply of raw
materials, such as palm oil, is essential
for the long-term wealth of our business.
Of course, due to the scale and complexity
of this issue, we cannot do this alone.
A multi-stakeholder approach is required.

That’s why we co-founded the Roundtable

on Sustainable Palm Oil (RSPO) in 2004.
The RSPO, which includes palm oil
growers and processors, consumer goods
manufacturers, retailers, investors and
a number of social and environmental
non-governmental organisations, now has
over 100 members. As the largest consumer
goods company on the RSPO Board, we’ve
gained significant insights. Key developments
during 2005 included the adoption of the
principles and criteria for Sustainable Palm
Oil Production – elements of sustainability
ensuring that production is economically
viable, environmentally appropriate and
socially beneficial.
Regional performance review
Europe

In Foods, we have held overall market Highlights Europe

Kees van der Graaf share through the course of the year, with at current rates of exchange
President Europe growth across all key categories apart from
€ million 2005 2004 Change
frozen foods. On 9 February 2006 we
announced that we were putting up for Turnover 16 211 16 650 (2.6)%
sale the majority of our frozen foods Operating profit 2 304 2 303 0.0%
Operating margin 14.2% 13.8%
business in Europe.

£ million 2005 2004 Change

In Home and personal care we had
a disappointing year and we have lost Turnover 11 084 11 290 (1.8)%
market share, particularly in the UK. Operating profit 1 575 1 563 0.8%

Our priority in Europe is to regain Overall, there was some pick-up in the $ million 2005 2004 Change
momentum and improve competitiveness. fourth quarter but we are not yet where Turnover 20 167 20 612 (2.2)%
The focus has been on enhancing the value we want to be. Operating profit 2 867 2 852 0.5%
to consumers of our products through
keener pricing, improved quality and more New product launches this year have Change at
and better innovation. included Knorr Vie mini shots, extensions constant
of the Becel/Flora pro.activ heart health 2004 rates
Marketing support has been raised to a more range, soups fortified with vitamins and Turnover (3.0)%
competitive level with additional spend low fat soups. Underlying sales (0.8)%
deployed against our best opportunities. Operating profit (0.2)%
The organisation is being streamlined and We have introduced a Rexona Sport variant
we are building up stronger capabilities in in deodorants, Axe shower gel and Sunsilk
customer management. hair styling products. We have further
improved our Home Care product range
We have made progress over the last year. with launches that address specific consumer
Volume has been slightly positive needs, such as ‘no-need-to-pre-treat’ laundry
(compared with a 2% decline in 2004), but detergents, Sun 4-in-1 dishwash and
investment in pricing meant that underlying Domestos sink and drain unblocker.
sales declined by 0.8% in the year.
The operating margin, at 14.2%, was
Central and Eastern Europe performed well 0.4 percentage points higher than last
in buoyant markets, notably in Russia which year. Increased advertising and promotions
was ahead by nearly 20%. and pricing investment together with
higher input costs were partly offset
Western Europe was challenging, with by productivity gains. Net restructuring,
continued weak consumer demand. disposal and impairment costs, at 0.8%
Our businesses grew in the Netherlands were 1.5 percentage points lower than
and Spain, but declined by around 2% in 2004.
in France and Germany and by nearly
4% in the UK.

Our Family Goodness range of

margarines, Rama, Blue Band and
Doriana, stress the natural goodness
of vegetable oils. Recent developments
to the range include an improved
value price relationship and more
modern packaging.

16 | 17 Unilever Annual Review and Summary Financial Statement 2005

 What’s in our products
In 2005 we launched a searchable database
where consumers can find out exactly
what ingredients are used in our Home and
personal care products in Europe.

By returning to its ‘roots’, our Access to the database is through Unilever’s

website at www.Unilever.com/ourvalues
margarines business is reinvigorating Visitors select their country and preferred
language before choosing a brand
its competitiveness. and product.

A single click then reveals the full list of

ingredients. Allergy sufferers can check
the presence of ingredients to which they
could be sensitive. Further help is available
through the brand carelines (telephone
numbers are listed on the website) and
there is additional information on our
website about the chemicals Unilever
uses in its products.

Promoting healthy hearts

Millions of people suffer from heart disease
every year. The World Heart Federation
(WHF) is committed to helping the prevention
and control of heart disease and stroke and
is made up of over 150 medical societies and
heart charities from 100 low and middle-
income countries. We are a key sponsor
of World Heart Day each September and
our Becel/Flora brand’s partnership with
the WHF means that we work together to
increase public awareness of heart disease
and its risk factors.

For example, in Greece our Becel pro.activ

brand teamed up with the Cardiologists
Foundation to bring free cholesterol testing,
heart checks and health advice direct to
people’s homes and school halls on the
remote Greek islands of the eastern
Mediterranean. In Sweden, we ran a lecture
tour on cholesterol, while in Finland our
Foodsolutions business worked with the
Finnish Heart Foundation to support
national Heart Week with healthy food
and recipes.
Regional performance review continued
The Americas

New launches in the US included the well Highlights The Americas

John Rice received Dove Cool Moisture range and the at current rates of exchange
President The Americas extension of Axe into male shower gels. In
€ million 2005 2004 Change
Latin America our brands have also been
very successful in connecting with younger Turnover 13 179 12 296 7.2%
consumers through Rexona ‘teens’ and Operating profit 1 719 896 91.9%
Operating margin 13.0% 7.3%
innovative communication for Axe.

£ million 2005 2004 Change

In the US we introduced all Small and
Mighty laundry detergent, offering the Turnover 9 010 8 337 8.1%
convenience of the same cleaning power Operating profit 1 175 607 93.5%
in a smaller bottle. We have invested in
Underlying sales grew by 4%, all coming communication of our Omo laundry $ million 2005 2004 Change
from volume gains, broadly based across brands, under the ’Dirt is Good’ campaign Turnover 16 395 15 221 7.7%
the region, underpinned by a successful in southern Latin America. Operating profit 2 138 1 109 92.8%
innovation programme.
In Foods, we strengthened the vitality Change at
Consumer demand in the US showed a credentials of our brands in the US with constant
sustained recovery. Our sales in the US grew Promise heart health spread, Ragú organic 2004 rates
by 3.2%, accelerating through the year, and support for the anti-oxidant properties Turnover 3.4%
and we gained market share in aggregate. of Lipton teas. AdeS continued to build Underlying sales 4.1%
across Latin America with the distinctive Operating profit 83.6%
In Brazil and Mexico, a strong first half nutrition benefits of ‘soy with fruit’.
was followed by relatively weaker demand
in the second half of the year. We grew The operating margin at current rates
in line with our markets in Home and of exchange was 13.0%, 5.7 percentage
Personal Care, but saw some share loss points higher than in 2004. Net charges
in Foods. for restructuring, disposal and impairment
were 3.4%, which was 5.8 percentage
Growth in Personal Care across the region points lower than in the prior year. Cost
has been driven by good consumer response savings offset a higher level of advertising
to our initiatives, including vitality innovation and promotions and increased input costs.
and consistent support. This has been There were also gains from the sale of an
particularly evident in the deodorants office in the US, in US healthcare plans and
and personal wash categories, with strong from currency effects on capital reductions.
double-digit growth for Axe, now the
number one deodorant in the US, and
for the Dove and Rexona brands.

Another strong Foods performance in the

US was driven by further share gains in ice
cream, continued good results from the
extension of the Country Crock and Bertolli
brands into new categories, and from
Lipton Ready-to-Drink and speciality teas.
Slim•Fast continued to regain share, but in
a much contracted weight management
Online games and video blogs
market and sales were well below the
were just two ways that Axe (also
previous year. sold as Lynx) grabbed the attention
of young, testosterone-charged guys
to become the top-selling deodorant
in the US in 2005.

18 | 19 Unilever Annual Review and Summary Financial Statement 2005

 Differentiating our brands through
social campaigning
The widely-discussed Dove Campaign
for Real Beauty has played a key role in
highlighting the need for a broader, more
Axe has inclusive definition of beauty, beyond
the stereotypical super-model image.
demonstrated how With our Dove Self-Esteem Fund, which
is a cornerstone of the brand’s long-term
brilliant marketing growth strategy, we’re going even further.

can propel our Together with partners such as the Girl

Scouts in the US and the UK’s Eating
brands to the top. Disorder Association, we’re funding
educational ‘Body Talk’ programmes in
schools to help young people develop
stronger body-related self-esteem.
By 2008, our aim is to have reached
1 million children.

Reaping the commercial advantages

of recycling
An exclusive recycling partnership with
a major Brazilian retailer, Pao de Acucar,
has not only given Unilever’s brands greater
in-store prominence at no extra cost but
also provided employment to more than
300 local people.

Under the award-winning scheme, a

co-operative of local people collects,
recycles and sells used packaging deposited
at recycling stations outside the retailer’s
supermarkets. In addition to having
Unilever’s logo on the stations, our
participating brands, Hellmann’s, AdeS,
Omo and Rexona, appear on point-of-sale
information and educational materials,
raising their profile.
Regional performance review continued
Asia Africa

In hair care we launched Dove in Indonesia, Highlights Asia Africa

Harish Manwani a Sunsilk summer range across South East at current rates of exchange
President Asia, a new variant for Lux Super Rich in
Asia Africa € million 2005 2004 Change
China and a strengthened Sunsilk range
across several key markets in Africa and Turnover 10 282 9 620 6.9%
the Middle East. Operating profit 1 291 1 040 24.1%
Operating margin 12.6% 10.8%

New formulations for our laundry products

£ million 2005 2004 Change
include improved whiteness delivery for
Surf in Indonesia and Omo for sensitive Turnover 7 030 6 524 7.8%
skin in Turkey. Operating profit 883 706 25.1%

We have capitalised on our leading In tea, we have substantially strengthened $ million 2005 2004 Change
positions and buoyant consumer demand the Brooke Bond brand in India, while Turnover 12 790 11 911 7.4%
across most of the region, growing Lipton is benefiting from strong regional Operating profit 1 606 1 288 24.7%
underlying sales by nearly 9%, in a innovations, including Earl Grey and Green
competitive environment, and increasing Tea variants in markets such as Turkey Change at
market share in key battlegrounds. and Arabia. constant
2004 rates
The growth was broad-based in terms of The operating margin was 12.6%, Turnover 6.9%
both categories and geographies. There were 1.8 percentage points higher than in 2004. Underlying sales 8.7%
notable performances in all major developing Increased investment in advertising and Operating profit 24.7%
and emerging countries, including a strong promotions was partly offset by productivity
recovery in India with market share gains, gains. The remaining difference was due to
and significant contributions from China, net restructuring, disposal and impairment
which was up by over 20%, and from South charges which were insignificant in 2005
East Asia, South Africa, Turkey and Arabia. compared with a net charge of 2.9%
Japan returned to growth. After a weak in 2004.
first half, Australia improved in the second
half of the year.

Most of the increase came from volume,

but price growth gained momentum
through the year, as we moved to selectively
recover increased commodity costs, especially
in Home Care.

Growth was underpinned by a range of

innovations. In skin care in India, Lux has
been strengthened with new soap bars
from the global range and the introduction
of limited editions. Innovations in Pond’s
included a new ‘mud’ range in China.

Omo strengthened its market leadership

in Vietnam, thanks to a locally-inspired
educational twist to our ‘Dirt is Good’ laundry
campaign through sport and art activities.

20 | 21 Unilever Annual Review and Summary Financial Statement 2005

 Driving extra savings through
eco-efficiency
Using the same methodology employed
Our ‘Dirt is Good’ in our highly successful Medusa water-
conservation programme, we expect to
campaign typifies our reduce waste levels for disposal by 30%
from our manufacturing sites in Asia Africa
ability to bring a great region between 2005 and 2006.

global idea to life at a local Under our new Triple ‘R’ (Reduce, Re-use,
Recycle) programme, the sites are
level, with powerful results. collaborating to share best practice and
setting targets to reduce waste levels and
disposal costs. In 2006, we’ll launch a
similar initiative, Electra, to reduce energy
consumption in Latin America.

Helping to combat HIV/AIDS

In some regions HIV/AIDS poses a serious
risk to our employees and communities.
Using the experience gained from dealing
with AIDS in our own workplace over the
last 25 years, we have worked in partnership
to share our learning with international
bodies such as the Global Business Coalition
on HIV/AIDS.

More locally, we work with groups such

as the South African Business Coalition
on HIV/AIDS, with whom we co-developed
a well-respected toolkit to help businesses
tackle the disease effectively. In Kenya we
have formed a partnership with the German
aid agency GTZ to share good practice with
the wider community, including schools
and smallholder tea growers.
Corporate Governance
Unilever constantly keeps its corporate governance arrangements under review.
It is our practice to comply, where practicable, with the highest standards of applicable
codes, and respond to developments appropriately.

Structures

Legal structure
NV and PLC are the two parent companies
of the Unilever Group, having separate
legal identities and separate stock exchange
listings for their shares, which are not
interchangeable. However, with their
Group companies, they operate effectively
as a single economic entity and constitute
a single reporting entity for the purposes of
presenting consolidated accounts.

In order to ensure unity of governance and

management, they have the same Directors
and are linked by a number of co-operation
agreements. In particular, there is the
Equalisation Agreement that regulates
the mutual rights of the two sets of
shareholders, including a formula for paying
dividends. These features mean that all
shareholders, whether of NV or PLC, share
in the prosperity of the whole business.

Sharper pricing, plus Full details of these agreements are contained

in the Annual Report and Accounts 2005
more affordable pack and are also available on www.unilever.com/
investorcentre/corpgovernance
sizes, is helping brands
like Knorr gain ground
in developing and
emerging markets.

Knorr launched, in Russia, two affordably priced

and packaged products – Knorr Cubitos cubes
and Knorr seasoning powder sachets.

22 | 23 Unilever Annual Review and Summary Financial Statement 2005

 Competing more effectively
through our people
NV and PLC are holding and service The changes in our structure that the Boards Our people’s creativity, energy and passion
companies. Unilever’s businesses are carried are proposing to our shareholders at the drive our business. One of our ongoing
out by their operating companies around AGMs in 2006 are: goals is to help our business leaders
the world. Shares in many Group companies connect to our people around the world
are held ultimately by either NV or PLC, • To adapt Unilever’s constitutional and achieve a shared understanding of our
with the largest exception being that the arrangements to allow greater flexibility business objectives and future challenges.
US companies are owned by both. to allocate assets between both parent In January 2006, at Unilever’s leadership
companies. This will ensure that Unilever forum, Group Chief Executive, Patrick Cescau
Business structure continues to be able to return capital presented Unilever’s change agenda, a set
In 2005, we introduced a new, simpler to shareholders and to pay dividends in of common initiatives which will be adopted
business structure that comprised three the most efficient manner. throughout Unilever. More information
regions, The Americas, Asia Africa and on this can be found on page 11. Further
Europe and two categories, Foods, and • To simplify the relationship between examples of how our people have helped
Home and personal care. The regions are our NV and PLC shares by establishing create a more competitive Unilever are set
responsible for profit, implementing proven one-to-one equivalence in their economic out in the coloured panels on this page
brand mixes in their region and focusing interest in the Unilever Group. This and the next.
on building capabilities with customers. will create transparency between the
The categories are responsible for the quotations of our shares and will be
entire brand development process achieved by a split of the NV shares Could it be U?
including innovation, brand positioning and and a consolidation of the PLC shares. “Can you think of 101 new things to do
communication and category strategies. with egg yolks and oil?” Questions like this,
• To allow shareholders the right to which appeared in one of our recent
Developments in corporate governance nominate candidates to the Boards, recruitment ads, lie at the heart of a new
Unilever constantly keeps its corporate taking into account the need to ensure and competitively different strategy to
governance arrangements under review. the unity of management. win the battle for the world’s top talent.
NV and PLC are subject to different We want to attract innovative individuals
corporate governance requirements and More information on these proposals can who relish real-life challenges. We’re
best practice codes, the most relevant be found in the Notices to these AGMs checking whether they can cut the mustard
being those in the Netherlands, the which can be found at www.unilever.com/ (Colmans, naturally) by putting eligible
United Kingdom and the United States. investorcentre/agms candidates through tough business games,
It is Unilever’s practice to comply, where among other initiatives.
practicable, with the highest level of The Boards
these codes, and respond to developments Unilever’s Directors are directors of both NV
appropriately. and PLC. Taking into account their respective
roles as Executive and Non-Executive
In 2005 we also announced that we Directors, collectively, they are ultimately
would undertake a thorough review of our responsible for the management, general
corporate structure to see if any changes affairs, direction and performance of the
should be made. The review was led by the business as a whole.
Chairman, Antony Burgmans, and included
Non-Executive Directors, David Simon and Directors are elected by shareholders at the
Jeroen van der Veer. On 19 December 2005 AGMs of NV and PLC and make themselves
the conclusions of the structure review fully accountable by submitting themselves
were announced. The Boards decided that for re-election each year. Our nomination
Unilever would retain its current structure, procedures are designed to ensure that
with some important changes. the same people are the Directors of both
companies.
Corporate Governance continued

The interests of shareholders are protected Directors are chosen for their broad and Growing by helping local
because they can remove the Directors relevant experience and international outlook, economies to grow
and, ultimately, overrule our nominations. as well as their independence. In 2004 Unilever’s success depends on the economic
As mentioned, proposals will be made to Bertrand Collomb was appointed as Senior health of the countries in which it operates.
the AGMs in 2006 to allow shareholders Independent Director and acted as their In an extensive research project with
the right to nominate Directors. spokesman. In 2005 he was appointed Oxfam GB and Novib (Oxfam Netherlands)
Vice-Chairman. ‘Exploring the links between business
The Boards currently comprise a Chairman, and poverty reduction: A case study on
four Executive Directors and eight Key elements of their role and Indonesia’, we examined the impact our
independent Non-Executive Directors. responsibilities as Non-Executive Directors local business has on the country’s
They meet at least seven times a year, to include strategy, scrutiny of performance, economic well-being.
consider material matters for NV, PLC and controls, remuneration, succession planning,
the Unilever Group. These matters include, reporting to shareholders, governance and Unilever Indonesia employs about 5 000
for example, results announcements, the compliance. They also form the Audit direct employees and contract workers.
Annual Report and Accounts, dividends, Committee which is fully compliant with The research found that indirectly, this
corporate strategy, annual plans, risks and the applicable rules in the Netherlands, manufacturing activity supports around
controls, major business transactions, and UK and the US, the Nomination Committee, 300 000 full-time equivalent jobs in our
Board appointments and remuneration. the Remuneration Committee and the ‘value chain’ – the chain that stretches
External Affairs and Corporate Relations from raw materials suppliers, through
Since the 2005 AGMs Unilever has had Committee. The Non-Executive Directors manufacturing to distribution and retailing
a separate Chairman and Group Chief meet as a group, without the Executive to consumers. Such employment and
Executive. There is a clear division of Directors present, under the chairmanship the wealth that it spreads around can
responsibilities between their roles. of the Senior Independent Director. make a significant contribution to
In addition they meet before each Board reducing poverty.
The Chairman is primarily responsible for meeting with the Chairman, the Group
leadership of the Boards, ensuring their Chief Executive and the Joint Secretaries.
effectiveness and setting their agendas.
He is also responsible for ensuring that A more detailed corporate governance Spreading vitality among our staff
the Boards receive accurate, timely and statement, as well as the annual reports During 2005, we encouraged greater
clear information. of the Audit, Nominations, Remuneration vitality among our staff in a programme
and External Affairs and Corporate Relations that encompassed the broad concepts of
The Group Chief Executive has been Committees, are contained in the Unilever ‘fitness of body’ and ‘fitness of heart, mind
entrusted, within the parameters set out Annual Report and Accounts 2005. This and spirit’. Designed to help them manage
in the Articles of Association of NV and Annual Report, our Code of Business their personal energy and resilience in the
PLC and the Governance of Unilever, Principles, NV’s and PLC’s Articles of face of change, as well as strike a good
with all the Boards’ powers, authorities Association and the Governance of Unilever work-life balance, among other objectives,
and discretions in relation to the are on our website www.unilever.com/ the first step of the programme was an
operational management of Unilever. investorcentre/corpgovernance The Enjoy Nutrition campaign.
Governance of Unilever contains, amongst
The Non-Executive Directors share other things, our rules on ‘Independence’ This campaign provided staff with important
responsibility for the execution of the of Directors and the remits of the Board nutritional information, such as advice
Boards’ duties, taking into account their Committees. on how to reduce consumption of sugar,
specific responsibilities, which are essentially salt and unhealthy fats. We also piloted
supervisory. They, in particular, comprise nutritional training for our chefs and
the principal external presence in the external suppliers so our canteens and
Governance of Unilever, and provide a strong restaurants could offer healthier options.
independent element. Our Non-Executive

24 | 25 Unilever Annual Review and Summary Financial Statement 2005

Executive Directors’ service contracts Details of our compliance with governance Strength in diversity
The Executive Directors are full-time requirements in the Netherlands, UK and US Our deep roots in over 100 countries
employees of Unilever. Information about are contained in the Annual Report and worldwide give us a powerful competitive
their remuneration can be found on Accounts 2005 and can also be found on our advantage, enabling us to adapt our global
pages 32 to 36 of this Annual Review. website at www.unilever.com/investorcentre brands to local consumers’ needs. To help
More detailed information can be found us understand their needs more fully, we’ve
in the Report of the Remuneration In the US, we are fully compliant with the introduced a diversity programme so that
Committee in the Annual Report and Listing Standards of the New York Stock our staff reflect our consumers’ diversity
Accounts 2005 and on our website at Exchange (NYSE) applicable to foreign more closely in gender, ethnicity and many
www.unilever.com/investorcentre issuers. Our corporate governance practices other ways.
do not significantly differ from those
The current Executive Directors are long- followed by US companies listed on the Diversity is already very evident. For
serving Unilever executives who can NYSE. However, the NYSE listing standards example, our top 1 000 managers span
reasonably expect, subject to satisfactory for US issuers require that all members 45 nationalities. With new initiatives,
performance, to be employed by Unilever of the Nomination Committee must including local Diversity Boards and tool
until retirement. The Remuneration (but not for foreign issuers such as Unilever) kits, we hope to encourage diversity
Committee takes the view that the be independent. Our Chairman is not deeper into our organisation.
entitlement of the Executive Directors to independent and he is a member of the
the security of twelve months’ notice of Nomination Committee. In Unilever we create an environment by
termination of employment is in line both embracing our differences that inspires
with the practice of many comparable Board changes people to contribute to our business. We
companies and the entitlement of other All the existing Executive Directors are encourage people to be themselves within
senior executives within Unilever. proposed for re-election at the 2006 AGMs. a framework of shared values and goals.
Their biographical details are shown on This means giving full and fair consideration
The Remuneration Committee’s aim is always pages 26 and 27. to all applicants and continuing development
to deal fairly with cases of termination to all employees, regardless of gender,
while taking a robust line in minimising All the existing Non-Executive Directors nationality, race, creed, disability, style
any compensation. are proposed for re-election, with the or sexuality.
exception of Bertrand Collomb, Oscar
The Executive Directors submit themselves Fanjul and Hilmar Kopper who will be
for re-election at the AGMs each year. The retiring at the 2006 AGMs.
Nomination Committee carefully considers Lifting the quality of our
each nomination for re-appointment. In addition four new Non-Executive Directors marketing worldwide
are to be proposed for election at the 2006 As ‘One Unilever’, we can now take a
The Directors stop holding executive office AGMs to replace the three Non-Executive holistic view of our global marketing
on ceasing to be Directors. Those appointed Directors retiring at the 2006 AGMs and capability and manage and deploy our
prior to 2004 retire at the latest by the age Claudio Gonzalez who retired at the 2005 talent more strategically. Overseen by
of 62. Appointees from 2004 onwards AGMs. These are Charles Golden, Executive the new post of Chief Marketing Officer,
retire at an age between 60 and 65, as Vice President and CFO of Eli Lilly and we have developed Group-wide programmes
decided by either them or Unilever. Company, Byron Grote, CFO of BP p.l.c., to improve our skills, tools and career paths,
Jean-Cyril Spinetta, Chairman/CEO of Air with an unprecedented focus on brand
Compliance France-KLM S.A. and Kornelis (Kees) Storm, building and development to support our
Unilever is subject to the corporate former Chairman of the Executive Board of new structure. Via our Marketing Academy,
governance requirements in the Netherlands, AEGON N.V. Biographical details for the we have also adopted a more applied,
the UK and, as a foreign private issuer in existing Non-Executive Directors are found business-led approach to training,
the US. All of these requirements were on pages 26 and 27. Those for the new underpinned by common toolsets
taken into account when structuring our Non-Executive Directors are contained in and data.
Board arrangements, details of which are the 2006 AGM Notices and on our website
set out in the Governance of Unilever. at www.unilever.com/investorcentre.
 Board of Directors

1 2 3 4 5 6 7

1. Oscar Fanjul 7 3. Ralph Kugler* 6. Jeroen van der Veer 1,9

Non-Executive Director President Home and personal care Non-Executive Director
Nationality: Spanish. Aged 56. Appointed 1996. Nationality: British. Aged 50. President Home and Nationality: Dutch. Aged 58. Appointed 2002.
Vice-Chairman, Omega Capital. Director, Marsh & personal care since 1 April 2005. Joined Unilever Chief Executive Royal Dutch Shell plc. Former Member,
McLennan Companies, the London Stock Exchange 1979. Appointed Director 11 May 2005. Previous Supervisory Board of De Nederlandsche Bank 2000-2004.
and Acerinox S.A. Non-Executive Director, Lafarge. posts include: President Home and personal care
Member, Advisory Board of Sviluppo Italia S.p.A. and Europe 2001. Business Group President, Latin 7. Antony Burgmans1,2
Senior Advisor of the Carlyle Group. International America 1999. Chairman, Unilever Thai Holdings Chairman
Advisor to Goldman Sachs and Trustee of the 1995. Chairman, Unilever Malaysia 1992. External Nationality: Dutch. Aged 59. Appointed 2005.
International Accounting Standards Committee appointments include: Non-Executive Director, Joined Unilever 1972. Appointed Director 8 May 1991.
Foundation. Chairman and CEO, Repsol 1986-1996. InterContinental Hotels Group PLC. Previous posts include: Chairman, Unilever N.V.
and Vice-Chairman, Unilever PLC 1999-2005.
2. Bertrand Collomb4,5,6 4. Hilmar Kopper 8 Vice-Chairman, Unilever N.V. 1998. Business Group
Non-Executive Vice-Chairman Non-Executive Director President, Ice Cream and Frozen Foods – Europe and
Nationality: French. Aged 63. Appointed 1994. Nationality: German. Aged 70. Appointed 1998. Chairman, Unilever Europe Committee 1996-1998.
Chairman, Lafarge S.A. Director, Total S.A. and Atco. Chairman, Supervisory Board of DaimlerChrysler AG. Responsible for South European Foods business
Member, Advisory Board of Banque de France. Non-Executive Director, Xerox Corp. Chairman, 1994-1996. Personal Products Co-ordinator 1991-1994.
German Advisory Board of Spencer Stuart. Member, External appointments include: Member, Supervisory
Advisory Board of Sviluppo Italia S.p.A. Former CEO Board of ABN AMRO Holding N.V., Non-Executive
and former Chairman, Supervisory Board of Deutsche Director, BP p.l.c. and Member, International Advisory
Bank AG. Board of Allianz AG.

5. Rudy Markham*
Chief Financial Officer
Nationality: British. Aged 59. Chief Financial Officer
since April 2005. Joined Unilever 1968. Appointed
Director 6 May 1998. Previous posts include: Financial
Director 2000. Strategy & Technology Director 1998.
Business Group President, North East Asia 1996-1998.
Chairman, Nippon Lever Japan 1992-1996. Chairman,
Unilever Australasia 1989-1992. Group Treasurer
1986-1989. External appointments include:
Non-Executive Director, Standard Chartered PLC,
Member, EAN International Management Board.

*1 Member Unilever Executive (UEx)

Member Nomination Committee
2 Member External Affairs and Corporate Relations Committee
3 Chairman External Affairs and Corporate Relations Committee
4 Chairman Nomination Committee
5 Chairman Remuneration Committee
6 Senior Independent Director
7 Member Audit Committee
8 Chairman Audit Committee
9 Member Remuneration Committee

26 | 27 Unilever Annual Review and Summary Financial Statement 2005

 8 9 10 11 12 13

8. Professor Wim Dik 2,7 10. The Rt Hon The Baroness Chalker of Wallasey 3 12. Kees van der Graaf *
Non-Executive Director Non-Executive Director President Europe
Nationality: Dutch. Aged 67. Appointed 2001. Nationality: British. Aged 63. Appointed 1998. Nationality: Dutch. Aged 55. President Europe since
Professor at Delft University of Technology. Chairman, Non-Executive Director, Freeplay Energy Group, April 2005. Joined Unilever 1976. Appointed Director
Supervisory Boards of Tele Atlas N.V. and N.V. Casema. Group 5 (Pty) Ltd and Equator Energy Limited. Member, 12 May 2004. Previous posts include: Foods Director
Non-Executive Director, Aviva plc and LogicaCMG plc. International Advisory Board of Lafarge S.A. and 2004, Business Group President, Ice Cream and
Chairman and CEO, Koninklijke PTT Nederland (KPN) Merchant Bridge & Co. Ltd. UK Minister of State at Frozen Foods 2001. Executive Vice-President, Foods
1988-1998 and Koninklijke KPN N.V. (Royal Dutch the Foreign and Commonwealth Office 1986-1997. and Beverages Europe 1998. Senior Vice-President,
Telecom) 1998-2000. Minister for Foreign Trade, Global Ice Cream category 1995. External appointments
Netherlands 1981-1982. 11. The Rt Hon The Lord Brittan of Spennithorne include: Board member, ECR (Efficient Consumer
QC, DL2 Response) and Member, IAB (International Advisory
9. Patrick Cescau* Non-Executive Director Board of the City of Rotterdam).
Group Chief Executive Nationality: British. Aged 66. Appointed 2000.
Nationality: French. Aged 57. Group Chief Executive Vice-Chairman, UBS Investment Bank and Chairman, 13. The Lord Simon of Highbury CBE 1,9
since April 2005. Joined Unilever 1973. Appointed UBS Limited. Member, International Advisory Non-Executive Director
Director 4 May 1999. Previous posts include: Chairman, Committee of Total. Member, European Commission Nationality: British. Aged 66. Appointed 2000.
Unilever PLC and Vice-Chairman, Unilever N.V. 2004- and Vice-President 1989-1999. Member, UK Non-Executive Director, Suez Group. Senior Advisor,
2005. Foods Director 2001. Financial Director 1999. Government 1979-1986. Home Secretary 1983-1985 Morgan Stanley International. UK Government
Controller and Deputy Financial Director 1998-1999. and Secretary of State for Trade and Industry 1985-1986. Minister 1997-1999. Group Chief Executive, BP p.l.c.
President, Lipton USA 1997-1998. President and CEO, 1992-1995 and Chairman 1995-1997.
Van den Bergh Foods USA 1995-1997. Chairman,
Indonesia 1991-1995. External appointments include:
Non-Executive Director, Pearson plc and Conseiller du
Commerce Extérieur de la France in the Netherlands.
Summary financial statement

This summary financial statement Opinion

In our opinion the Summary Financial Statement is consistent with
is a summary of information contained the full annual accounts, the Report of the Directors and the Report
in Unilever’s financial statements, of the Remuneration Committee of the Unilever Group for the year
ended 31 December 2005 and complies with the applicable
Report of the Directors and the Report requirements of Section 251 of the United Kingdom Companies Act
of the Remuneration Committee as 1985 and the regulations made thereunder.
set out in the Unilever Annual Report PricewaterhouseCoopers PricewaterhouseCoopers LLP
and Accounts 2005. Accountants N.V. Chartered Accountants
Rotterdam, and Registered Auditors
This statement does not contain sufficient information to allow as full The Netherlands London, United Kingdom
an understanding of the results and state of affairs of Unilever, and As auditors of Unilever N.V. As auditors of Unilever PLC
of its policies and arrangements concerning Directors’ remuneration,
as would be provided by the full Annual Report and Accounts. 28 February 2006

Copies of the Unilever Annual Report and Accounts 2005, Unilever website
which are produced in both English and Dutch, can be accessed The maintenance and integrity of the Unilever website are the
directly or ordered through www.unilever.com/investorcentre responsibility of the Directors; the work carried out by the auditors
Shareholders may also elect to receive the Annual Report and does not involve consideration of these matters and, accordingly,
Accounts for all future years by request to the appropriate share the auditors accept no responsibility for any changes that may
registrars. Further details are provided on page 37. have occurred to the financial statements since they were initially
presented on the website.
The auditors have issued unqualified audit reports on the full
accounts and the auditable part of the Report of the Remuneration Legislation in the Netherlands and the UK governing the
Committee. The United Kingdom Companies Act 1985 requires preparation and dissemination of financial statements may differ
the auditors to report if the accounting records are not properly from legislation in other jurisdictions.
kept, if the required information and explanations are not received, or
if the Directors’ Report is inconsistent with the audited consolidated Reporting currency and exchange rates
accounts. Their reports on the full financial statements and the The sterling and US dollar figures shown on pages 16, 18, 20 and 36
auditable part of the Report of the Remuneration Committee have been provided for the convenience of users and do not form
contain no such statements. part of the audited accounts of the Unilever Group. These figures
have been translated from euros using the following rates of exchange:
The following Summary Financial Statement should be read together
with the narrative set out earlier in this Annual Review which Annual average rates Year-end rates
includes, to the extent applicable, any important future developments 2005 2004 2003 2005 2004 2003
or post-balance sheet events.
€1 = £ 0.6837 0.6781 0.6912 0.6864 0.7069 0.7077
€1 = $ 1.2440 1.2380 1.1260 1.1840 1.3660 1.2610
Auditors’ statement to the shareholders of Unilever N.V. and
Unilever PLC The balance sheet is translated at year-end rates and the income statement and cash
flow statement are translated at annual average rates.
We have examined the Summary Financial Statement in euros
set out on pages 30 to 31.
Accounting policies
Respective responsibilities of Directors and Auditors The accounts have been prepared in accordance with International
The Directors are responsible for preparing the Annual Review and Financial Reporting Standards as adopted by the EU, including
Summary Financial Statement 2005 in accordance with applicable interpretations from the International Financial Reporting Interpretations
law. Our responsibility is to report to you our opinion on the Committee and the Standing Interpretations Committee and with
consistency of the Summary Financial Statement within the Annual Book 2 of the Civil Code in the Netherlands and the United Kingdom
Review with the full annual accounts, the Report of the Directors Companies Act 1985.
and the Report of the Remuneration Committee, and its
compliance with the relevant requirements of Section 251 of the The accounts are prepared under the historical cost convention as
United Kingdom Companies Act 1985 and the regulations made modified by the revaluation of biological assets, financial assets
thereunder. We also read the other information contained in the classified as ‘available-for-sale investments’ and ‘at fair value through
Annual Review and consider the implications for our report if we profit or loss’, and derivatives.
become aware of any apparent misstatements or material
inconsistencies within the Summary Financial Statement. As a result of the operational and contractual arrangements in
place between NV and PLC, they form a single reporting entity for
Basis of opinion the purposes of preparing consolidated accounts. Accordingly, the
We conducted our work in accordance with Bulletin 1999/6 ‘The accounts of the Unilever Group are presented by both NV and PLC as
Auditors’ Statement on the Summary Financial Statement’ issued their respective consolidated accounts.
by the Auditing Practices Board for use in the United Kingdom.

28 | 29 Unilever Annual Review and Summary Financial Statement 2005

International Financial Reporting Standards Dividends
Unilever has adopted International Financial Reporting Standards The Boards have resolved to recommend to the Annual General
as adopted by the EU with effect from 1 January 2005, with a Meetings on 8 and 9 May 2006 the declaration of final dividends
transition date of 1 January 2004. on the ordinary capital of NV and of PLC respectively in respect
of 2005 at the rates shown in the tables below.
The most important changes to our accounting policies are listed
below. These changes also affect the 2004 comparative information As noted above, IAS 10 requires that dividends approved after the
in the 2005 consolidated financial statements with the exception balance sheet date are not reflected in the financial statements for
of the changes in accounting for financial instruments and the the current reporting period. As a result, the final 2004 dividends
presentation of assets held for sale, which have been applied are reflected in the financial statements for 2005, and the final
prospectively from 1 January 2005. 2005 dividends, if approved by shareholders at the AGMs, will be
reflected in the financial statements for 2006.
Under IAS 36 we no longer apply systematic amortisation to
goodwill and intangible assets with an indefinite life, but instead The dividends will be paid in accordance with the timetable set out
test these assets for impairment on at least an annual basis. on page 37.

Under IAS 10 we no longer recognise a liability in any period for NV 2005 2004
dividends which have been proposed but will not be approved Per €0.51 of ordinary capital
until after the balance sheet date. Interim €0.66 €0.63
Final €1.32 €1.26
Under IAS 12 we recognise certain additional deferred tax balances Total €1.98 €1.89
arising on temporary differences between the tax base and the
accounting base of balance sheet items. The most significant of PLC 2005 2004
these relates to intangible assets which were identified at the time
of the Bestfoods acquisition, on which a deferred tax liability has Per 1.4p of ordinary capital
Interim 6.77p 6.33p
been established via reserves. Final 13.54p 12.82p

Deferred tax balances arising in respect of pension assets and Total 20.31p 19.15p
liabilities are no longer netted off against pensions balances.
This has led to an overall reclassification of deferred tax balances Dividends for US shareholders
in the balance sheet.
Per €0.51 of NV Per 5.6p of PLC
ordinary capital ordinary capital
Under IAS 38 we capitalise and amortise purchased and internally
2005 2004 2005 2004
developed software where the appropriate criteria are met.
Interim $0.79 $0.80 $0.48 $0.47
From 1 January 2005 onwards, we present NV preference share Final $1.58* $1.62 $0.94* $0.96
capital as a liability rather than as part of equity, in accordance Total $2.37 $2.42 $1.42 $1.43
with IAS 32. Also from this date we have recognised all derivative *
Proposed final dividends translated into US dollars at the rate of exchange ruling on
financial instruments on the balance sheet at fair value. We 8 February 2006 (€1 = $1.19, £1 = $1.74 (rounded to two decimal places)). These
measure certain non-derivative financial assets at fair value and dividends will be paid using the exchange rates ruling on 8 May 2006 for NV and
apply hedge accounting methodology to all significant qualifying 9 May 2006 for PLC.
hedging relationships.
Summary information under US GAAP in US$ (unaudited)
In the case of retirement benefits, the amendments to IAS 19 Total operations: 2005 2004 2003
mean that the impact on Unilever has been restricted to certain
valuation differences which did not have a significant impact Net income attributable to shareholders (million) 3 292 3 325 4 287
Combined net income per share
on our reported numbers. Per €0.51 of ordinary capital 3.38 3.42 4.39
Per 1.4p of ordinary capital 0.51 0.51 0.66
For further details of these and other reporting changes
Combined diluted net income per share
which have applied for 2005, please refer to our website at Per €0.51 of ordinary capital 3.27 3.28 4.27
www.unilever.com/investorcentre Per 1.4p of ordinary capital 0.49 0.49 0.64
Shareholders’ equity (million) 17 751 19 141 16 834
Turnover definition
Until 31 December 2004 promotional couponing and trade
communication costs were included in the cost of advertising The Summary Financial Statement of Unilever has been prepared
and promotions. From 1 January 2005 these costs are deducted under accounting principles which differ in certain respects from
from turnover and treated as part of the price element in the those generally accepted in the US.
variance analysis of sales growth, together with other trade
promotion costs which are already deducted from turnover. Key differences arise from the treatment of goodwill and certain
Comparatives have been restated to reflect this change. intangible assets in prior years, derivative financial instruments,
pensions and the recognition of certain restructuring costs and
impairments. Further details of significant differences are given in
the Unilever Annual Report and Accounts 2005.
Summary financial statement continued

Consolidated summary income statement for the year ended 31 December

€ million £ million $ million

2005 2004 2005 2004 2005 2004

Continuing operations
Turnover 39 672 38 566 27 124 26 151 49 352 47 744

Operating profit 5 314 4 239 3 633 2 876 6 611 5 249

Net finance costs (618) (630) (423) (428) (769) (780)

Share of net profit/(loss) of joint ventures 47 39 32 26 59 48
Share of net profit/(loss) of associates (25) 2 (17) 1 (32) 2
Other income from non-current investments 33 54 23 37 41 67
Profit before taxation 4 751 3 704 3 248 2 512 5 910 4 586

Taxation (1 249) (810) (854) (549) (1 554) (1 003)

Net profit from continuing operations 3 502 2 894 2 394 1 963 4 356 3 583
Net profit from discontinued operations 473 47 324 31 589 58
Net profit 3 975 2 941 2 718 1 994 4 945 3 641

Attributable to:
Minority interest 209 186 143 126 260 230
Shareholders’ equity 3 766 2 755 2 575 1 868 4 685 3 411

Combined earnings per share

From total operations

Basic earnings per share:
Per €0.51 of ordinary capital €3.88 €2.83 $4.82 $3.50
Per 1.4p of ordinary capital €0.58 €0.42 39.77p 28.79p $0.72 $0.53

On a diluted basis the figures would be:

Per €0.51 of ordinary capital €3.76 €2.72 $4.68 $3.37
Per 1.4p of ordinary capital €0.56 €0.41 38.56p 27.65p $0.70 $0.51

From continuing operations

Basic earnings per share:
Per €0.51 of ordinary capital €3.39 €2.78 $4.22 $3.44
Per 1.4p of ordinary capital €0.51 €0.42 34.78p 28.29p $0.63 $0.52

On a diluted basis the figures would be:

Per €0.51 of ordinary capital €3.29 €2.67 $4.09 $3.31
Per 1.4p of ordinary capital €0.49 €0.40 33.72p 27.18p $0.61 $0.50

Consolidated summary statement of recognised income and expense for the year ended 31 December
€ million £ million $ million

2005 2004 2005 2004 2005 2004

Fair value gains/(losses) on financial instruments and

cash flow hedges net of tax 346 n/a 238 n/a 411 n/a
Actuarial gains/(losses) on pension schemes net of tax (49) (480) (34) (325) (61) (594)
Currency retranslation gains/(losses) net of tax 181 80 22 64 (877) 669
Net income/(expense) recognised directly in equity 478 (400) 226 (261) (527) 75

Net profit 3 975 2 941 2 718 1 994 4 945 3 641

Total recognised income and expense 4 453 2 541 2 944 1 733 4 418 3 716

Attributable to:
Minority interests 249 167 165 112 263 230
Shareholders’ equity 4 204 2 374 2 779 1 621 4 155 3 486

30 | 31 Unilever Annual Review and Summary Financial Statement 2005

Consolidated summary balance sheet as at 31 December
€ million £ million $ million

2005 2004 2005 2004 2005 2004

Goodwill and intangible assets 18 055 17 007 12 393 12 022 21 376 23 231
Property, plant and equipment 6 492 6 181 4 456 4 369 7 686 8 443
Pension asset for funded schemes in surplus 1 036 625 711 442 1 226 854
Deferred tax assets 1 703 1 491 1 169 1 054 2 017 2 037
Other non-current assets 1 072 1 064 735 752 1 269 1 453
Total non-current assets 28 358 26 368 19 464 18 639 33 574 36 018

Assets held for sale 217 n/a 149 n/a 258 n/a

Inventories 4 107 3 756 2 819 2 655 4 863 5 130

Trade and other current receivables 4 830 4 131 3 315 2 920 5 719 5 643
Other financial assets 335 1 013 230 716 396 1 384
Cash and cash equivalents 1 529 1 590 1 050 1 124 1 811 2 172
Total current assets 10 801 10 490 7 414 7 415 12 789 14 329

Borrowings due within one year (5 942) (5 155) (4 079) (3 644) (7 036) (7 042)
Trade payables and other current liabilities (incl. taxation) (8 658) (8 232) (5 942) (5 819) (10 251) (11 244)
Restructuring and other provisions (644) (799) (442) (565) (762) (1 091)
Total current liabilities (15 244) (14 186) (10 463) (10 028) (18 049) (19 377)
Net current assets/(liabilities) (4 443) (3 696) (3 049) (2 613) (5 260) (5 048)
Total assets less current liabilities 24 132 22 672 16 564 16 026 28 572 30 970
Borrowings due after more than one year 6 457 6 893 4 432 4 873 7 645 9 415
Pension liability for funded schemes in deficit 2 415 2 339 1 658 1 654 2 859 3 196
Pension liability for unfunded schemes 4 202 3 740 2 884 2 643 4 975 5 108
Restructuring and other provisions 732 565 502 399 866 772
Deferred tax liabilities 933 789 641 557 1 105 1 077
Other non-current liabilities (incl. taxation) 602 717 413 507 713 980
Total non-current liabilities 15 341 15 043 10 530 10 633 18 163 20 548

Liabilities held for sale 26 n/a 18 n/a 31 n/a

Shareholders’ equity 8 361 7 264 5 739 5 135 9 900 9 923

Minority interests 404 365 277 258 478 499

Total equity 8 765 7 629 6 016 5 393 10 378 10 422
Total capital employed 24 132 22 672 16 564 16 026 28 572 30 970

Consolidated summary cash flow statement for the year ended 31 December
€ million £ million $ million

2005 2004 2005 2004 2005 2004

Cash flow from operating activities 5 924 6 925 4 051 4 696 7 370 8 573
Income tax paid (1 571) (1 378) (1 074) (934) (1 954) (1 706)
Net cash flow from operating activities 4 353 5 547 2 977 3 762 5 416 6 867

Interest received 130 168 89 114 162 209

Net capital expenditure (813) (869) (556) (589) (1 011) (1 076)
Acquisitions and disposals 784 316 536 214 975 390
Other investing activities 414 265 283 179 515 328
Net cash flow from/(used in) investing activities 515 (120) 352 (82) 641 (149)

Dividends paid on ordinary share capital (1 804) (1 720) (1 233) (1 166) (2 244) (2 129)
Interest and preference dividends paid (643) (787) (440) (534) (800) (974)
Change in borrowings and finance leases (880) (2 890) (602) (1 959) (1 095) (3 577)
Purchase of treasury stock (1 276) (332) (873) (225) (1 588) (411)
Other financing activities (218) (209) (149) (142) (271) (260)
Net cash flow from/(used in) financing activities (4 821) (5 938) (3 297) (4 026) (5 998) (7 351)
Net increase/(decrease) in cash and cash equivalents 47 (511) 32 (346) 59 (633)

Cash and cash equivalents at the beginning of the year 1 406 1 428 994 1 011 1 921 1 801

Effect of foreign exchange rate changes (188) 489 (158) 329 (482) 753
Cash and cash equivalents at the end of the year 1 265 1 406 868 994 1 498 1 921
Summary financial statement continued

Summary remuneration report Reward policy 2006 and beyond – Executive Directors

2005 was a year of far-reaching and important changes to the way Main principles
Unilever is run. These changes have had an important impact on It is the objective of Unilever’s remuneration policy for Executive
the work of the Remuneration Committee. Directors to drive performance and to set reward in support of
achievement of its goals. Therefore it is important to recruit key
The most significant change was the ending of the dual executives who can drive the business forward and achieve the
chairmanship and the creation of the single chief executive role. highest results for shareholders. This is essential to the successful
At the AGMs in May 2005 Antony Burgmans was appointed to leadership and effective management of Unilever as a major global
the new role of non-executive Chairman and Patrick Cescau took company. To meet this objective the Remuneration Committee
on the new role of Group Chief Executive. This change improved follows three key principles, supported by shareholders:
our governance and organisational effectiveness.
• A significant proportion of the Executive Directors’ total reward
At the AGMs in May 2005 three Executive Directors retired is linked to a number of key measures of company performance
after long and distinguished careers with Unilever. Clive Butler, to create alignment with the strategy and business priorities;
Keki Dadiseth and André van Heemstra all agreed to retire to
• The reward policy is benchmarked regularly against arrangements
allow the creation of a new executive team. Each agreed to retire
of other global companies based in Europe. This ensures that
at the age of 60. Unilever continued to pay their base salary and
Executive Directors’ reward levels remain competitive; and
benefits, in lieu of notice, for a maximum of one year, fulfilling
its contractual obligations.
• An internal comparison is made with the reward arrangements
for other senior executives within Unilever to support consistent
Anthony Burgmans stepped down as Executive Director at the
application of Unilever’s executive reward policies.
2005 AGMs and assumed the new role of Non-Executive Chairman.
In fulfilment of contractual obligations he continues to receive his
Each element of the Executive Directors’ reward package focuses on
salary and benefits until June 2006. However, he is no longer
supporting different business objectives. The Unilever reward policy
entitled to any annual or long-term incentives. After June 2006,
table on page 33 provides an overview of all the elements of reward
he will receive a fee for his services as Chairman.
(excluding pension), the key drivers, the resulting performance
measures and indicative levels. In setting targets for the performance
Given the new Board structure and Unilever’s longer-term strategy,
measures, the Committee is guided by what needs to happen to
the Committee reviewed the existing reward packages for each of
drive underlying performance and this is reflected in the short-and
the current Executive Directors during the year. Base salaries have
long-term performance targets.
been adjusted to reflect the new roles and responsibilities in line
with the market. The revised salary levels are set out on page 34.
Depending on the level of performance, the variable component
could vary between 0 and around 80% of the total reward
Annual incentives criteria for 2005 were underlying sales growth,
package (excluding pensions).
trading contribution (Unilever’s version of economic value added)
and individual performance targets. Taking into account the
Some of the Executive Directors serve as non-executive directors
actual delivery of sales growth and trading contribution in 2005,
on the Boards of other companies. Unilever requires that all
the annual incentive Executive Directors earned for 2005 were
remuneration and fees earned from outside directorships
roughly half maximum levels.
are paid directly to Unilever.
No awards vested in 2005 for Executive Directors under the TSR
Base salary
plan as Unilever’s TSR performance over the period 2002-2004
The Remuneration Committee reviews base salary levels annually,
fell short of requirements.
taking into account external benchmarks in the context of company
and individual performance.
Following shareholder approval, we operated the Global Performance
Share Plan for the first time. Its clearly defined performance criteria
focus management on top-line growth and cash flow generation.
For 2006, we retained the same criteria as in 2005 for annual
incentive, and we reviewed individual performance targets to ensure
these reflect, next to corporate performance, each Executive
Director’s responsibility for delivering specific growth objectives.

All this was done to create the greatest possible alignment between
the various elements of the remuneration package and Unilever’s
longer-term strategy.

Finally, we have revised the Report of Remuneration Committee

to improve its transparency in respect of the arrangements.

Bertrand Collomb Chairman of the Remuneration Committee

David Simon
Jeroen van der Veer

32 | 33 Unilever Annual Review and Summary Financial Statement 2005

Unilever reward policy table

Element Payment Indicative Levels at face Plan Objectives/Key Drivers Performance Measures
Method value – as % of base pay
Base Salary Cash Market Competitive Attraction and retention Individual performance
Short-term (one year)

of key executives
Annual Incentive Cash (75%) ED: 60% on target • Delivery of trading contribution (Unilever’s • Trading contribution (ED: 40%, GCE: 50%)
Shares (25%) (range of 0 – 100%) primary internal measure of an added
economic value) and top-line growth targets • Underlying sales growth (ED: 40%, GCE: 50%)
GCE: 90% on target
(range of 0 – 150%) • Individual responsibility for key Unilever • Individual contribution to Unilever business
business objectives strategy (ED: 20%, GCE: 50%)
Global Shares Grant level: c. 25% • Ungeared free cash flow as the basic driver • Ungeared free cash flow (50%)
Performance of Unilever shareholder returns
Share Plan Vesting level: 0 – 200% • Underlying sales growth (50%)
Long-term (three years)

of grant • Top-line growth as essential to Unilever’s

long-term value creation
Total Shareholder Shares Grant level: c. 60% Total Shareholder Return at upper half of peer Relative Total Shareholder Return
Return group with 20 other companies
Vesting level: 0 – 200%
of grant
Share Matching Shares 25% of annual incentive Alignment with shareholders’ interests
Plan paid

GCE = Group Chief Executive ED = Executive Director

Annual incentive Long-term incentives

The annual incentive arrangement, rewards Executive Directors In 2005 shareholders also approved the replacement of the
for the delivery of trading contribution (Unilever’s primary Executive Option Plan with the Unilever Global Performance Share
internal measure of added economic value) and top-line growth Plan. The long-term incentives for Executive Directors now consist
targets, as well as for their individual contribution to Unilever’s of three elements, all of which are delivered in shares:
business strategy.
• Global Performance Share Plan
In 2005, shareholders approved changes to the corporate • Total Shareholder Return (TSR) Long-Term Incentive Plan
performance criteria for the annual incentive arrangement, to
• Share Matching Plan (linked to the annual incentive)
ensure continuing alignment with business priorities, and a
maximum opportunity for the Group Chief Executive to 150%
Executive Directors are required to demonstrate a significant
of base salary. The maximum level is only payable in the case of
personal shareholding commitment to Unilever. Within five years
exceptional performance. The annual incentive opportunity for
of appointment, they are expected to hold shares worth 150% of
other Executive Directors remains between 0 and 100%.
their annual base salary. This reinforces the link between the
Executive Directors and other shareholders.
The performance criteria for the annual incentive are now:
• Trading contribution (maximum 40%, for Group Chief Executive Global Performance Share Plan (GPSP)
maximum 50%, of base salary). This is Unilever’s primary internal Under the GPSP, conditional rights over shares in NV or PLC are
measure of added economic value. Increases reflect the combined awarded annually to Executive Directors. For Executive Directors
impact of top-line growth, margin improvement and capital the value of the grant of conditional shares will not exceed 50%
efficiency gains. It is well aligned with our objective of a of base salary. The number of shares actually received at the end
progressive improvement in return on invested capital and of the performance period of three years depends on the
with shareholder value creation. satisfaction of the performance targets.
• Underlying sales growth (maximum 40%, for Group Chief
The performance measures for vesting are underlying sales growth
Executive maximum 50%, of base salary). This focuses on the
(for 50% of the award) and ungeared free cash flow (for 50%
organic growth of Unilever’s turnover.
of the award). These are key performance measures in Unilever’s
• Individual business targets (maximum 20%, for Group Chief external reporting. Underlying sales growth focuses on the organic
Executive 50%, of base salary). The individual performance growth of Unilever’s turnover. Ungeared free cash flow expresses
targets are tailored to each individual’s responsibilities to deliver the translation of profit into cash and thus longer-term
certain business objectives supporting the strategy. Individual economic value.
contributions are subject to robust measures and targets to
ensure objectivity of achievement. In respect of performance targets, there is a minimum and a
maximum performance range for each of the two measures and
The annual incentive is calculated at the end of each financial year associated vesting levels. Each year, the Remuneration Committee
and payable in the following March. Part of the annual incentive reviews the performance targets by taking account of market
(25%) is delivered to the Executive Directors in the form of shares in conditions and internal financial planning. The Remuneration
NV and PLC which are matched by a conditional award of ‘matching Committee conducted a review of these targets at the start of
shares’, as further described under long-term incentives below. 2006 to ensure that those attaching to awards to be made in
2006 were appropriate and challenging.
Summary financial statement continued

TSR Long-Term Incentive Plan Arrangements for current Executive Directors in 2005
The TSR plan rewards Executive Directors for creating more value
for Unilever’s shareholders when compared with the investment Base salary
returns generated by competitors. Following the AGMs in May 2005, the number of Executive Directors
and their responsibilities changed substantially. The Committee
Under this plan conditional rights over shares in NV and PLC are therefore reviewed base salary levels in light of these changes. The
awarded annually to Executive Directors. salary levels were benchmarked against those paid in other major
global companies based in Europe, excluding companies in the
The current level of conditional annual awards is as follows: financial sector. The increases for 2005 reflect the change in the
composition and the responsibilities of the Executive Directors,
• Group Chief Executive: Shares in NV and PLC to the combined
market levels as well as individual and company performance. The
value of €800 000; and
total salary figure compared with that for last year has reduced
• Other Executive Directors: Shares in NV and PLC to the significantly as a consequence of the reduction in the number of
combined value of €500 000. Executive Directors. The current annual base salary levels for the
Executive Directors are set out below:
Vesting is subject to Unilever’s relative TSR performance. TSR
measures the returns received by a shareholder, capturing both Executive Director Current Annual Base Salary Levels
the increase in share price and the value of dividend income Based in the UK
(assuming dividends are re-invested). Unilever’s TSR performance P J Cescau £935 000
is compared with a peer group of competitors over a three-year R D Kugler £570 000
performance period. The TSR results are compared on a single
R H P Markham £645 000
reference currency basis.
Based in the Netherlands
No shares will vest if Unilever is ranked below position 11 of the C J van der Graaf €760 000
TSR ranking table over the three-year period. Between 25% and
200% of the shares will vest if Unilever is ranked in the top half Annual incentive
of the table. The annual incentive awards for 2005 were subject to achievement
of Underlying Sales Growth and Trading Contribution targets
Share Matching Plan (linked to the annual incentive) in combination with individual key strategic business targets.
The Share Matching Plan enhances the alignment with shareholders The Committee measured the results against the targets and
interests and supports the retention of key executives. In addition, determined the annual incentive amounts for 2005.
the necessity to hold the shares for a minimum period of three
years supports the shareholding requirements set out on page 33. Long-term incentives
• Global Performance Share Plan
As mentioned earlier, the Executive Directors receive 25% of the The first award under this new plan was made to Executive
annual incentive in the form of NV and PLC shares. These are Directors in 2005. The performance period of this award
matched with an equivalent number of matching shares. The is 1 January 2005 to 31 December 2007 and therefore no
matching shares will vest after three years provided that the award vested in 2005.
underlying shares have been retained during this period and the
Executive Director has not resigned or been dismissed. • TSR Plan
Vesting of the conditional award made in 2002 was based
The Remuneration Committee considers that there is no need for on the TSR performance of Unilever (when ranked against
further performance conditions on the vesting of the matching its defined peer group with competitors) over the three-year
shares because the number of shares is directly linked to the performance period ended 31 December 2004. For this period,
annual incentive (which is itself subject to demanding performance Unilever was ranked number 13 in the peer group and therefore
conditions). In addition, during the three-year vesting period the no vesting occurred for this award in March 2005. Therefore
share price of NV and PLC will be influenced by the performance these shares lapsed.
of Unilever which, in turn, will affect the ultimate value of the
matching shares on vesting. • Share Matching Plan
The matching shares originally granted in 2000 and 2002 on a
Executive Directors’ pensions conditional basis, vested in 2005 subject to fulfillment of the
Executive Directors are provided with a defined benefit final salary retention conditions.
pension, which is consistent with the pension provision for other
Unilever Netherlands and UK employees. The Executive Directors’ • Executive Options
arrangement provides a pension of a maximum of two-thirds of The grants of executive share options made in 2002 became
final pensionable pay if they retire at age 60 or later. exercisable as from 2005. As the size of the 2002 grants was
based on Unilever’s EPS performance, the options at vesting
As stated in last year’s report, the Remuneration Committee decided were subject to no further conditions.
that annual incentive would no longer be part of pensionable pay
for new Executive Directors appointed as from 2005. For Executive
Directors appointed prior to 2005, annual incentive is pensionable
up to a maximum of 20% of base salary.

34 | 35 Unilever Annual Review and Summary Financial Statement 2005

Pensions Five-Year Historical TSR Performance
In response to changes in the pension tax regimes in both the Growth in the Value of a Hypothetical £100 Holding Over Five Years
Netherlands and the UK: FTSE 100 Comparison Based on 30 Trading Day Average Values
Unilever
FTSE 100
• The projected value of the Netherlands-based Executive Director’s Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005
final benefit has been converted from a reasonable expectation 130
to a vested benefit, consistent with the treatment adopted for 120
other Netherlands senior executives with similar expectations. 110

100
• UK-based Executive Directors and other potentially affected 90
employees have been informed that the company will offer
80
them the option of capping their benefit provided by the Unilever
70
UK Pension Fund at their personal Lifetime Allowance and
60
receiving the balance of their benefit directly from the company.
50

For Executive Directors appointed since 2005 the annual incentive

no longer forms part of the pensionable salary. Growth in the Value of a Hypothetical Investment Over Five Years
AEX Comparison Based on 30 Day Average Values
Unilever
Arrangements for former Executive Directors in 2005 AEX Index
At the AGMs in May 2005, Antony Burgmans stepped down Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005
as Executive Director of the Boards of Unilever N.V. and PLC and 130

was appointed in a new role as Non-Executive Chairman of both 120

Boards. In line with the contract’s provisions, Mr Burgmans is 110
receiving salary and benefits until June 2006. From June 2006 100
he will start to receive a Chairman’s fee. While he has received 90
a pro-rated annual incentive payment for his service to the 2005 80
AGMs, he has no further annual incentive entitlements. Equally, 70
he received no long-term incentive awards after the AGMs in 60
May 2005 and will receive no further new awards. His existing
50
long-term incentives are subject to relevant provisions in the
plan rules. Mr Burgmans’ retirement date will be June 2006,
then being 59, and from this date he will receive a full pension Non-Executive Directors
as if he had retired at 60. The Non-Executive Directors receive fees and (where appropriate)
an attendance allowance from both NV and PLC. The current
Messrs Butler, Dadiseth and Van Heemstra retired as Executive members receive no other remuneration in respect of their
Directors at the AGMs in May 2005. Each has received a pro-rated Non-Executive duties from either NV or PLC such as incentives
annual incentive payment for service to the 2005 AGMs. None or pension benefits.
received any new long-term incentive awards in 2005 and their
existing long-term incentives are subject to relevant provisions in The level of their fees reflects their commitment and contribution
the plan rules. Unilever is respecting its contractual obligations to the companies. The levels were last reviewed in 2004 against fees
and has provided for each director to be paid their base salary payable by comparable companies in the UK and continental Europe,
and benefits for the maximum period of up to one year. Mr Butler to ensure Unilever’s levels reflected current market practice and their
and Mr Dadiseth have received their payments as lump sums. increased responsibilities as Directors. The current fee levels are set
Mr Van Heemstra is receiving his payments on a monthly basis. out below:
They receive their full pension benefits at 60 as if they had retired
on this date. Fees payable Fees payable
Non-Executive Role by NV by PLC
Other items Senior Independent Director €48 000 £36 000
Unilever’s share performance relative to broad-based Committee Chairman €38 000 £29 000
equity indices
The UK Companies Act (Schedule 7A) requires us to show Other Non-Executive Directors €32 000 £24 000

Unilever’s relative share performance, based on TSR, against a

holding of shares in a broad-based equity index for the last five
years. The Remuneration Committee has decided to show
Unilever’s performance against two indices, namely the FTSE 100
Index London and the Euronext AEX index Amsterdam, as these
are the most generally used indices in the Netherlands and the
UK, where we have our principal listings.
Summary financial statement continued

Remuneration for individual Executive Directors – 2005

Executive Directors’ total remuneration for the year ended 31 December 2005 including other income arising from long-term incentives
were €12 235 000 (2004: €21 329 000). The equivalent totals in pounds sterling were £8 365 000 (2004: £14 463 000). The details for
each Executive Director for 2005 are set out in the table below. For convenience the amounts are shown both in euros and [in brackets]
in pounds sterling.
Other income(2) arising from Total of Total of
Annual Emoluments 2005(1) long-term incentives in 2005 annual annual
emoluments emoluments
Vesting and other and other
Gains on Value of of TSR/LTIP income income
Total Total exercise vesting of in 2005 arising from arising from
Allowances Value of annual annual of share matching (performance long-term long-term
Base and other benefits Annual emoluments emoluments options shares period incentives incentives
salary payments(3) in kind(4) incentive(5) 2005 2004 in 2005 in 2005 2002/2004) in 2005 in 2004
Name and Base Country ’000 ’000 ’000 ’000 ’000 ’000 ’000 ’000 ’000 ’000 ’000

Current Executive Directors

Patrick Cescau(6) (UK) €1 336 €94 €98 €1 016 €2 544 €1 779 – €198 – €2 742 €3 897
[£914] [£65] [£66] [£694] [£1 738] [£1 207] – [£135] – [£1 873] [£2 643]
Kees van der Graaf (NL) €751 €7 €23 €338 €1 119 €600 – €54 – €1 173 €600
[£514] [£5] [£16] [£231] [£765] [£408] – [£37] – [£802] [£408]
Ralph Kugler(7) (UK) €556 €15 €7 €239 €817 – €10 – – €827 –
[£380] [£10] [£5] [£163] [£559] – [£5] – – [£563] –
Rudy Markham (UK) €943 €22 €35 €425 €1 425 €1 091 – €185 – €1 610 €1 644
[£645] [£15] [£24] [£290] [£975] [£740] – [£126] – [£1 101] [£1 115]
Former Executive Directors (position changed in 2005)
Antony Burgmans(8) (NL) €592 €913 €31 €266 1 802 €1 732 – €241 – €2 043 €2 573
[£404] [£624] [£21] [£182] [£1 232] [£1 175] – [£164] – [£1 397] [£1 745]
Former Executive Directors (retired in 2005)
Clive Butler(9) (UK) €323 €776 €20 €145 €1 264 €860 – €172 – €1 436 €1 484
[£221] [£531] [£14] [£99] [£864] [£583] – [£118] – [£981] [£1 005]
Keki Dadiseth(10) (UK) €414 €583 €38 €186 €1 221 €1 144 – €137 – €1 358 €1 659
[£283] [£398] [£26] [£128] [£835] [£775] – [£94] – [£928] [£1 124]
André van Heemstra(11) (NL) €304 €431 €12 €137 €884 €851 – €162 – €1 046 €1 645
[£208] [£295] [£8] [£94] [£604] [£577] – [£111] – [£715] [£1 115]
(1)
Annual emoluments includes base salary, allowances and other payments (see footnote 3) and the value of benefits in kind earned in respect of 2005. It also includes the
annual incentive (both the cash element and the element paid in shares) payable in March 2006 relating to the performance year 2005. The value of the matching shares
conditionally awarded in 2006 in respect of the performance year 2005 is not included as these form part of the long-term incentives and the value will be reported when
they vest in 2009.
(2)
Other income includes the gains realised in 2005 following the exercise of share options granted in earlier years. It also includes the value of the matching shares vested in
2005, which were originally granted in 2000 and 2002. No vesting occurred in 2005 with respect to the TSR LTIP shares granted in 2002 (performance period 2002 to
2004) as Unilever was ranked 13 in the peer group and therefore no value is reported here.
(3)
Allowances include the following payments: allowances in lieu of company car, entertaining allowance, blind trust fees and allowance to compensate for loss of net income
suffered because part of their income was paid in NL. All allowances are taxable in the country of residence of the Executive Director concerned apart from the entertaining
allowance which is currently tax free in NL.
For the former Executive Directors who stepped down at the AGMs in 2005 the allowance figures includes the contractual entitlements.
(4)
Includes the value of the following benefits in kind: benefits for company car, housing, medical insurance benefit and private use chauffeur driven cars.
Included are the taxable benefits which are taxable in the country of residence of the Executive Director
(5)
Part of the annual incentive is paid in the form of shares in NV and PLC. The value of these shares is included in the figures of the annual incentive shown above. In addition
to these shares, each Executive Director is awarded, on a conditional basis an equivalent number of matching shares which are not included above. The value of these
matching shares, will be reported when they vest in 2009.
(6)
Group Chief Executive from AGMs 2005.
(7)
Appointed as an Executive Director on 11 May 2005. Remuneration shown above covers the period from date of appointment.
(8)
Executive Director until May 11 2005. Base salary reflects payments up until May 2005. Under Allowance and other payments, following contractual provisions, received
base salary between June-December 2005 (€828 000); June to December benefits (€18 000); allowances (€16 000). From June 2006, will receive a Chairmanship fee.
(9)
Executive Director until May 11 2005. Base salary reflects payments up until May 2005. Under Allowance and other payments, the total amount received as a lump sum
payment of €775 000 (comprising period June 2005 – June 2006) in accordance with contractual provisions.
(10)
Executive Director until May 11 2005. Base salary reflects payments up until May 2005. Under Allowance and other payments, the total amount received as a lump sum
payment of €557 000 (comprising period June 2005 – December 2005) in accordance with contractual provisions.
(11)
Executive Director until May 11 2005. Base salary reflects payments up until May 2005. Under Allowance and other payments, the total amount received as monthly
payments was €426 000 comprising salary June 2005 – December 2005, also for June 2005 – December 2005 €7 000 benefits and allowances €3 000 in accordance with
contractual provisions.
Figures have been translated into euros using the following exchange rate: €1 = £0.6837.

The Summary Financial Statement was approved by the Boards of Directors on 28 February 2006.

A Burgmans P Cescau
Chairman Group Chief Executive

36 | 37 Unilever Annual Review and Summary Financial Statement 2005

Shareholder information

Financial calendar Quarterly results announcements

These are available on our website at www.unilever.com/investorcentre
Annual General Meetings in English, with figures in euros, sterling or US dollars. In Dutch they
NV 9.30 am Monday 8 May 2006 Rotterdam are available at www.unilever.nl/onsbedrijf/beleggers
PLC 11.00 am Tuesday 9 May 2006 London
UK capital gains tax
Announcements of results The market value of PLC 1.4p ordinary shares at 31 March 1982
First Quarter 4 May 2006 would have been 34.58p per share. Since 1982, PLC ordinary shares
First Half Year 3 August 2006 have been sub-divided on two occasions and consolidated once.
Third Quarter 2 November 2006 Firstly, with effect on 26 June 1987, the 25p shares were split into
Final for Year (provisional) 8 February 2007 five shares of 5p each. Secondly, with effect on 13 October 1997,
the 5p shares were split into four shares of 1.25p each. Lastly, with
Dividends on ordinary capital effect on 10 May 1999, the shares were consolidated by replacing
Final for 2005 – announced 9 February 2006 and to be declared every 112 shares of 1.25p each with 100 shares of 1.4p each.
8 May 2006 for NV and 9 May 2006 for PLC
Listing details
Ex-Dividend Record Payment NV The shares or certificates (depositary receipts) of NV are listed on
Date Date Date
the stock exchanges in Amsterdam, New York, Frankfurt and Zürich.
NV 10 May 2006 09 May 2006 12 June 2006
PLC 17 May 2006 19 May 2006 12 June 2006 PLC The shares of PLC are listed on the London Stock Exchange
NV – New York Shares 10 May 2006 12 May 2006 12 June 2006
PLC – ADRs 17 May 2006 19 May 2006 12 June 2006 and, as American Depositary Receipts (each evidencing four ordinary
shares of 1.4p each), in New York.
Interim for 2006 – to be announced 2 November 2006

Ex-Dividend Record Payment Share registration

Date Date Date Netherlands
N.V. Algemeen Nederlands
NV 03 Nov 2006 02 Nov 2006 04 Dec 2006
PLC 08 Nov 2006 10 Nov 2006 04 Dec 2006 Trustkantoor ANT
NV – New York Shares 03 Nov 2006 07 Nov 2006 04 Dec 2006 PO Box 11063
PLC – ADRs 08 Nov 2006 10 Nov 2006 04 Dec 2006 1001 GB Amsterdam

Cumulative preference shares NV Telephone +31 (0)20 522 2555

Telefax +31 (0)20 522 2500
Announced Ex-Dividend Record Payment Email registers@ant-trust.nl
Date Date Date Date
4% 08 Dec 2006 11 Dec 2006 08 Dec 2006 02 Jan 2007
UK
6% and 7% 08 Sep 2006 11 Sep 2006 08 Sep 2006 02 Oct 2006 Computershare Investor Services PLC
PO Box 82
The Pavilions
Unilever website Bridgwater Road
Shareholders are encouraged to visit our website, www.unilever.com Bristol BS99 7NH
which has a wealth of information about the Unilever Group.
There is a section designed specifically for investors at Telephone +44 (0)870 600 3977
www.unilever.com/investorcentre Telefax +44 (0)870 703 6119
Website www.unilever.com/shareholderservices
Electronic communications
Shareholders of Unilever PLC can elect not to receive paper copies of USA
the Annual Review and other shareholder documents by registering Citibank Shareholder Services
at www.unilever.com/shareholderservices Shareholders will then PO Box 43077
be alerted by email to view these documents on our website. Providence RI 02940-3077

NV shareholders participating in the Shareholders Communication Toll free phone (inside US) 888 502 6356
Channel will be able to appoint a proxy electronically to vote on Toll phone (outside US) +1 816 843 4281
their behalf at the AGM in 2006. Website www.citibank.com/adr

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Unilever N.V.
Weena 455, PO Box 760
3000 DK Rotterdam
The Netherlands
T +31 (0)10 217 4000
F +31 (0)10 217 4798

Unilever PLC
PO Box 68, Unilever House
Blackfriars, London EC4P 4BQ
United Kingdom
T +44 (0)20 7822 5252
F +44 (0)20 7822 5951

Unilever PLC registered office

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