As filed with the Securities and Exchange Commission on March 28, 2002

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	WASHINGTON, D.C. 20549
	FORM 20-F
(Mark One)
	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)
	OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
	OR
	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
	THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended 31 DECEMBER 2001
	OR
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
	THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ______________ to ______________
	Commission file number 1-4546
	UNILEVER PLC
	(Exact name of Registrant as specified in its charter)

Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
(Title of class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
(Title of class)

	The total number of outstanding shares of the Registrant’s capital at the close of the period covered by the Annual Report was 2 911 458 580
	Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
	Yes                       No
	Indicate by check mark which financial statement item the Registrant has elected to follow.
	Item 17                  Item 18

Cautionary Statement
This Annual Report & Accounts and Form 20-F 2001 contains forward-looking statements (within the meaning of the US Private Securities Litigation Reform Act 1995) based on our best current information and what we believe to be reasonable assumptions about anticipated developments. Words such as ‘expects’, ‘anticipates’, ‘intends’ and other similar expressions are intended to identify such forward-looking statements. Because of the risks and uncertainties that always exist in any operating environment or business, we cannot give any assurance that the expectations reflected in these statements will prove correct. Actual results and developments may differ materially depending upon, among other factors, currency values, competitive pricing, consumption levels, costs, environmental risks, physical risks, risks related to the integration of acquisitions, legislative, fiscal and regulatory developments and political and social conditions in the economies and environments where Unilever operates. You are cautioned not to place undue reliance on these forward-looking statements.

Risks and uncertainties that could cause actual results to vary from those described in our forward-looking statements include those given under the sections entitled ‘About Unilever’ on pages 7 to 10, ‘Operating Review’ on pages 11 to 27, ‘Financial Review’ on pages 28 to 33, and ‘Risk Factors’ on pages 32 and 33, to which you should refer.

Unilever Annual Report & Accounts and Form 20-F 2001

The Unilever Group
Unilever N.V. (NV) is a public limited company registered in the Netherlands, which has listings of shares or certificates (depositary receipts) of NV on the stock exchanges in Amsterdam, London and New York and in Belgium, France, Germany, Luxembourg and Switzerland.

Unilever PLC (PLC) is a public limited company registered in England which has shares listed on the London Stock Exchange and, as American Depositary Receipts, on the New York Stock Exchange.

The two parent companies NV and PLC, together with their group companies, operate as nearly as is practicable as a single entity (the Unilever Group, also referred to as Unilever or the Group). NV and PLC and their group companies constitute a single group under Netherlands and United Kingdom legislation for the purposes of presenting consolidated accounts. Accordingly, the accounts of the Unilever Group are presented by both NV and PLC as their respective consolidated accounts.

Publications
This publication is produced in both Dutch and English and comprises the full Annual Report and Accounts for 2001 of NV and PLC. This document complies with the Netherlands and the United Kingdom regulations. It also forms the NV and PLC Annual Reports on Form 20-F to the Securities and Exchange Commission in the United States for the year ended 31 December 2001, and cross references to Form 20-F are set out on page 117. It is made available to all shareholders who request or elect to receive it, and on the website at www.unilever.com .

The separate publication, ‘Unilever Annual Review 2001’, containing a Summary Financial Statement with figures expressed in euros, with translations into pounds sterling and US dollars, is also published in Dutch and English. It is a short form document that is prepared in accordance with the United Kingdom regulations for Summary Financial Statements. The Unilever Annual Review 2001 is mailed to all registered shareholders and to other shareholders who are either entitled or have asked to receive it, and is also made available on the website at www.unilever.com .

Accounting policies
Unilever’s principal accounting policies are described on pages 51 to 53. Unilever complies with United Kingdom Financial Reporting Standard 18, which requires that the most appropriate accounting policies are selected in all circumstances.

Reporting currency and exchange rates
From 1 January 2000, Unilever adopted the euro as its principal reporting currency. Details of the change are explained on page 11. The effect of exchange fluctuations means that the trends shown may differ significantly from those previously shown in sterling.

Details of key exchange rates used in preparation of these accounts are given on page 93, together with Noon Buying Rates in New York for the equivalent dates.

Unilever Annual Report & Accounts and Form 20-F 2001

Unilever Annual Report & Accounts and Form 20-F 2001

It is our pleasure to report to you on a year of substantial progress towards the goals set in our Path to Growth strategy announced in February 2000. Leading brands grew by 5.3% for the year and operating margin BEIA rose to 13.9% compared to 12.0% in 2000. We are on track to reach our 2004 goals of 5% to 6% overall growth and an operating margin of at least 16% of sales.

The past year has shown the great strength of our business and demonstrated our ability to execute substantial change. We have made excellent progress with the integration of Bestfoods, implemented our new divisional structure and dealt effectively with a more challenging business environment. Our performance is a testimony to the strength of our brands and particularly to the excellence of our people.

Our new divisional structure of Foods and Home & Personal Care is already accelerating the execution of our business plans. The integration of research into the divisions has strengthened our capability to deliver more and bigger innovations to fuel brand growth.

There was a strong focus on increased cash generation throughout the business. Cash from operations increased to € 7.5 billion compared with € 6.7 billion in 2000. The divestment programme generated a further € 3.6 billion in the year. Net debt was reduced by € 3.3 billion.

Earnings per share BEIA grew by 12.2%. On a one-year basis, our Total Shareholder Return (TSR) put us into the top third of our peer group of 21 companies. However, over a three-year period we were positioned 15th in this group. Our target remains a sustained top third TSR ranking.

Path to Growth progress
We can report good progress on all aspects of our Path to Growth strategy. We are focused increasingly on driving the growth of our leading brands and dealing with other brands in ways which will create value for shareholders. We are fi nding innovative ways of pleasing the consumer and stretching our leading brands into new categories to create space to grow them faster. Leading brands now account for 84% of total turnover and are expected to account for 95% by 2004.

In 2001, exceptional restructuring costs of € 1.6 billion have been charged. Further progress has been made in reshaping the supply chain to support our brands and increase margins. Since the inception of Path to Growth, 59 plants have been sold or closed and our global buying programme has produced incremental savings of € 1.2 billion.

A number of important divestments were completed in 2001, notably Elizabeth Arden, Bestfoods Baking Company, Unipath and the brands sold in connection with the acquisition of Bestfoods. The proposed divestment of DiverseyLever was announced in November 2001.

Unilever people
2000 and 2001 were years when we welcomed a large number of talented people into the business but had to part with many others. People across the business were engaged in reawakening the spirit of enterprise, in which trust and transparency form the foundation of team building. Throughout Unilever those teams were challenged to identify key areas where we must progress to successfully meet our targets. Remuneration systems were redesigned to reward exceptional achievement and delivery of shareholder value.

This was a year which made enormous demands on our people. They responded magni fi cently, remaining focused on markets and customers, and growing the business. Moreover, we integrated the businesses acquired in 2000 and coped with organisational change and restructuring programmes. This was an exceptional challenge to which our colleagues responded in an outstanding manner. Without exceptional team work, this could not have been achieved successfully and we thank everyone for showing a real spirit of enterprise.

Brands and regions
In Foods we have seen a marked increase in both growth and pro fi tability through the year. This has been broad-based across brands and geography, with notable performances coming from Europe and our global ice cream business. There were excellent contributions from the businesses acquired in 2000 and the integration of Bestfoods has proceeded well with the synergy bene fi ts being delivered ahead of plan.

In Home & Personal Care there was good progress in our mass businesses with particularly strong contributions from skin, hair and deodorants and a robust performance from laundry. These were partly offset by a decline in Prestige fragrances.

Unilever Annual Report & Accounts and Form 20-F 2001

Underlying sales grew by 4% in Europe. Growth was broad-based and included a strong contribution from Central and Eastern Europe. It was particularly pleasing to see sales of spreads and cooking products growing by 4.6% fuelled by the success of pro • activ , Bertolli and the roll-out of Culinesse .

In North America there were excellent performances from ice cream and Slim • Fast. Our Home and Personal Care brands across the skin, hair and deodorant categories all performed strongly.

In Asia and Paci fi c, sales grew by 6% with a strong performance in Japan, including the successful launch of Dove hair care. In India, the more focused brand portfolio delivered improved growth and pro fi tability.

In Africa, Middle East and Turkey and in Latin America, a key feature of the year has been our determination to move prices to recover devaluation-driven cost increases. Underlying sales grew by more than 5% in these regions.

Responsible corporate behaviour
In 2001, Unilever published its fi rst Social Review spelling out our approach to corporate social responsibility. We encourage all our people to play a positive part in the communities in which they live and work.

We updated Unilever ’ s Code of Business Principles because we believe that our reputation for high corporate standards is a key asset which needs to be fresh and living throughout our business. The Code is printed in full on the following page.

Our environmental strategy is publicly available and we are committed to tracking our performance against speci fi c targets. We made signi fi cant progress in developing guidelines for sustainable production of crops which are key to our foods business and are working towards the sourcing of all fi sh for our business from sustainable sources by 2005. The number of our local partnerships in the Global Nature Fund ’ s Living Lakes initiative grew to 11.

The way ahead
In 2001 a step-up in the growth of our leading brands, a record operating margin, strong cash fl ow and the continued reshaping of our portfolio all provide con fi dence about the strategy we have put in place and our ability to deliver – on time and in full. Our task in the year ahead is to maintain the momentum notwithstanding a weaker world economy. In 2002 we are planning to sustain the growth of the leading brands reinforced by those of Bestfoods and to again deliver low double-digit earnings growth. Our con fi dence comes from the momentum developed in 2001, and from the energy and enthusiasm which is alight in the Unilever team.

Antony Burgmans	Niall FitzGerald
Chairmen of Unilever

Unilever Annual Report & Accounts and Form 20-F 2001

Standard of Conduct
We conduct our operations with honesty, integrity and openness, and with respect for the human rights and interests of our employees. We shall similarly respect the legitimate interests of those with whom we have relationships.

Obeying the Law
Unilever companies and our employees are required to comply with the laws and regulations of the countries in which we operate.

Employees
Unilever is committed to diversity in a working environment where there is mutual trust and respect and where everyone feels responsible for the performance and reputation of our company.

We will recruit, employ and promote employees on the sole basis of the quali fi cations and abilities needed for the work to be performed. We are committed to safe and healthy working conditions for all employees. We will not use any form of forced, compulsory or child labour. We are committed to working with employees to develop and enhance each individual ’ s skills and capabilities. We respect the dignity of the individual and the right of employees to freedom of association. We will maintain good communications with employees through company-based information and consultation procedures.

Consumers
Unilever is committed to providing branded products and services which consistently offer value in terms of price and quality, and which are safe for their intended use. Products and services will be accurately and properly labelled, advertised and communicated.

Shareholders
Unilever will conduct its operations in accordance with internationally accepted principles of good corporate governance. We will provide timely, regular and reliable information on our activities, structure, fi nancial situation and performance to all shareholders.

Business Partners
Unilever is committed to establishing mutually bene fi cial relations with our suppliers, customers and business partners. In our business dealings we expect our business partners to adhere to business principles consistent with our own.

Community Involvement
Unilever strives to be a trusted corporate citizen and, as an integral part of society, to ful fi l our responsibilities to the societies and communities in which we operate.

Public Activities
Unilever companies are encouraged to promote and defend their legitimate business interests. Unilever will co-operate with governments and other organisations, both directly and through bodies such as trade associations, in the development of proposed legislation and other regulations which may affect legitimate business interests. Unilever neither supports political parties nor contributes to the funds of groups whose activities are calculated to promote party interests.

The Environment
Unilever is committed to making continuous improvements in the management of our environmental impact and to the longer-term goal of developing a sustainable business. Unilever will work in partnership with others to promote environmental care, increase understanding of environmental issues and disseminate good practice.

Innovation
In our scienti fi c innovation to meet consumer needs we will respect the concerns of our consumers and of society. We will work on the basis of sound science applying rigorous standards of product safety.

Competition
Unilever believes in vigorous yet fair competition and supports the development of appropriate competition laws. Unilever companies and employees will conduct their operations in accordance with the principles of fair competition and all applicable regulations.

Business Integrity
Unilever does not give or receive whether directly or indirectly bribes or other improper advantages for business or fi nancial gain. No employee may offer, give or receive any gift or payment which is, or may be construed as being, a bribe. Any demand for, or offer of, a bribe must be rejected immediately and reported to management.

Unilever accounting records and supporting documents must accurately describe and re fl ect the nature of the underlying transactions. No undisclosed or unrecorded account, fund or asset will be established or maintained.

Conflicts of Interests
All Unilever employees are expected to avoid personal activities and fi nancial interests which could con fl ict with their responsibilities to the Company. Unilever employees must not seek gain for themselves or others through misuse of their positions.

Compliance – Monitoring – Reporting
Compliance with these principles is an essential element in our business success. The Unilever Boards are responsible for ensuring these principles are communicated to, and understood and observed by, all employees.

Day-to-day responsibility is delegated to the senior management of the regions and operating companies. They are responsible for implementing these principles, if necessary through more detailed guidance tailored to local needs.

Assurance of compliance is given and monitored each year. Compliance with the Code is subject to review by the Boards supported by the Audit Committee of the Boards and the Corporate Risk Committee.

Any breaches of the Code must be reported in accordance with the procedures speci fi ed by the Joint Secretaries. The Boards of Unilever will not criticise management for any loss of business resulting from adherence to these principles and other mandatory policies and instructions.

The Boards of Unilever expect employees to bring to their attention, or to that of senior management, any breach or suspected breach of these principles.

Provision has been made for employees to be able to report in con fi dence and no employee will suffer as a consequence of doing so.

Unilever Annual Report & Accounts and Form 20-F 2001

Description of business
Unilever is one of the world ’ s leading suppliers of fast moving consumer goods in foods, household care and personal product categories.

Business structure
Since January 2001 our operations have been organised into two global divisions – Foods and Home & Personal Care (HPC) – headed by Division Directors. This structure allows improved focus on foods and home and personal care activities at both the regional and global levels. It allows for faster decision making and strengthens our capacity for innovation by more effectively integrating research into the divisional structure.

These global divisions ’ operations are organised into businesses on a regional basis, with the exception of DiverseyLever and Prestige within HPC and the global businesses of Ice Cream and Frozen Foods and Foodservice within the Foods Division. They are headed by Business Presidents who are responsible for the pro fi tability of their regional and global businesses. These businesses remain the driving force behind Unilever, comprising as they do the operating companies which provide the key interface with customers and consumers, allowing quick response to the needs of local markets.

Foods
Oil and dairy based foods and bakery
We are the category leader in margarine and related spreads in most countries in Europe and North America. We sell spreads, oils and cooking fats in more than 100 countries.

Important brands in these markets are Becel (the Netherlands), Flora (UK), Fruit d’Or (France), Rama (Germany) and Country Crock and Take Control (US). We are category leader in branded olive oil in many countries in Western Europe and North America, our most important international brand being Bertolli .

In July 2001 we sold the Bestfoods Baking Company to George Weston Ltd for a debt free price of € 1.9 billion.

Ice cream and beverages
We are the world ’ s leading producer of ice cream, with sales in more than 90 countries worldwide. Important household names are Algida, Langnese, Ola and Wall’s in Europe and Ben & Jerry’s , Good Humor and Breyers in the United States. Ice cream products such as Carte d’Or , Cornetto, Magnum, Solero, and Viennetta are brands sold internationally as part of local or international household brands.

We are the largest seller of packet tea in the world, with important positions in packet tea and tea-related drinks in many regions through our Lipton and Brooke Bond brands. Lipton is the world ’ s leading brand in tea and iced tea. Sales of ready-to-drink teas are growing throughout Europe, North America and East Asia. We have a joint venture with PepsiCo Inc., which markets ready-to-drink products in North America and Mexico.

Culinary and frozen foods
As a result of our acquisition of Bestfoods in October 2000 we are the global leader in the Culinary category. Knorr is now Unilever ’ s biggest brand, with well over € 2.3 billion of sales, in over 100 countries. Its product range covers soups, bouillons, sauces, snacks, noodles and complete meals. Hellmann’s is our third biggest foods brand and has market leadership in mayonnaise in Brazil, the United Kingdom, the United States and many other countries.

We have signi fi cant pasta sauce businesses in Mexico, North America and the United Kingdom under the Ragú brand. We also sell bouillons and other cooking aids in Europe, North America, Australasia, Egypt and sub-Saharan Africa. In the United Kingdom, Colman’s is a signi fi cant brand in meal sauces and condiments and Amora and Maille in France are important brands covering condiments, mayonnaise and vinegar-based products which also have sales in a number of European countries. Salad dressings, spices and seasonings are marketed in the United States under the Wishbone and Lawry’s brands.

In May 2001, following the approval of the European Commission, we completed the sale of our dry soup and sauces business in Europe to the Campbell Soup Company for a debt free price of € 1 billion. These included the Blå Band brand in Denmark, Finland and Sweden, the Batchelors brand in the United Kingdom, the McDonnels brand in Ireland, the Oxo brand in Belgium, Ireland and the United Kingdom, the Royco brand in Belgium, France and Portugal and Bestfoods ’ Lesieur range of mayonnaise products in France. The businesses were divested as a result of undertakings given to the European Commission in connection with the acquisition of Bestfoods in October 2000.

We are the leading producer of frozen foods in Europe, under the Findus brand in Italy, Birds Eye brand in the United Kingdom and Iglo brand in most other European countries. In October 2001 we completed the sale of our North American seafood business, which comprised the Gorton’ s business in the United States and the BlueWater business in Canada, to Nippon Suisan (USA), Inc. for $175 million ( € 198 million) in cash.

Home & Personal Care
Home care and professional cleaning
We are one of the global leaders in the domestic and professional home care markets. In the home care sector our products have been developed to meet the diverse requirements of consumers to clean and care for their homes and clothes. In laundry, they include tablets for convenience, traditional powders and liquids for soaking, washing by hand and by machine. In developing and emerging markets, soap bars are available for lower income consumers. In household care our products are designed to tackle most cleaning and hygiene needs around the home.

Our home care brands are available in over 100 countries, many of them holding leading market positions. Our home care brands include, internationally, Omo, Surf, Skip, all, Comfort, Wisk, Cif, Domestos and, in the UK, Persil .

Unilever Annual Report & Accounts and Form 20-F 2001

DiverseyLever provides professional cleaning and hygiene products and services to customers in over 60 countries. The business holds leading positions in major sectors such as hospitality, foodservice, health care and food and beverage production. On 20 November 2001 we announced a de fi nitive agreement to sell DiverseyLever to Johnson Wax Professional. The total value of the transaction to Unilever is $1.6 billion ( € 1.75 billion). Unilever will retain a one-third holding in the combined business for fi ve years. The transaction, which is subject to regulatory approval and normal consultative procedures, is expected to be completed in the fi rst half of 2002.

Personal care
We are the world leader in skin cleansing, deodorants and anti-perspirants. In skin cleansing our most international brands include Lux, Dove and Lifebuoy . Rexona, Impulse and Degree are the key brands in deodorants and anti-perspirants while Axe/Lynx is the leading international brand in the male personal care range.

We have important market shares in toothpastes, skin care and hair products in many countries. Toothpastes are sold widely under the Signal, Close-up and Mentadent brands. In skin care, products are sold internationally under the Pond’s, Vaseline and Fair and Lovely brands. Hair shampoos are available internationally under the Sunsilk, Seda, Organics and Timotei brands. We hold leading positions in North America where the key brands are Suave, ThermaSilk, Salon Selectives and Finesse .

Our Prestige fragrances business is one of the world ’ s largest. We sell a number of fragrances under the Calvin Klein name, including Obsession, Eternity and Escape. In addition, in recent years cK one and cK be have been introduced to appeal to the youth market. The designer fragrance brands Cerruti, Lagerfeld, Chloé and Valentino , together with Nautica, Vera Wang and BCBG fragrance, complete our extensive portfolio.

In December 2001 we sold Unipath Ltd, our women ’ s health diagnostics subsidiary, to Inverness Medical Innovations Inc. of Waltham, Massachusetts USA for £103 million ( € 166 million) in cash.

Other operations
To support our consumer brands, we own palm oil plantations in the Democratic Republic of Congo, C ô te d ’ Ivoire, Ghana and Malaysia and tea plantations in India, Kenya and Tanzania.

Technology and innovation
All Unilever research and development is now aligned with our leading brands. Our Path to Growth strategy requires us to exploit the potential of these brands to the full, so our investment is now aimed at fewer, larger projects.

In 2001 we spent € 1 178 million (2000: € 1 187 million; 1999: € 935 million) on research and development: 2.3% of our turnover. Examples of recent signi fi cant projects include the development of: Culinesse , a high-performance, easy-to-use liquid cooking product; a new spread made with fresh cheese launched as Rama Crême Bonjour in a number of Eastern European countries; new technology for Dove shampoo and new formats such as Domestos/Cif easy-to-use wipes. We fi led 450 new patent applications.

Information technology
In 2001, we simpli fi ed and harmonised our IT systems in support of the Path to Growth.

The opening of a new European IT centre in the UK marked the completion of our global infrastructure programme. The concentration of Unilever ’ s IT infrastructure into a network of fi ve centres around the world enables faster and more ef fi cient support to the business.

Common information systems are helping us towards our goal of a harmonised European business. During the year, we continued the integration of both our systems and business processes across national boundaries.

We remain committed to deploying internet technology in support of our strategy. We are using the internet to support the development of a world-class supply chain – a programme which has achieved buying savings of € 1.2 billion since its February 2000 launch. We are making purchasing and replenishment faster and easier through the development of vendor-managed inventory services, allowing suppliers to see into our systems and replenish stocks automatically.

We continued the roll-out of the Ariba on-line buying system, with launches in Europe and North America. The system will allow employees to purchase non-production items from selected suppliers at volume-negotiated prices.

During the year, we continued to develop our branded websites to help meet the needs of busy consumers.

In 2001, we were also heavily engaged in, and are now successfully completing, the integration of Bestfoods ’ IT systems into a single platform for each of our operating units.

Environmental responsibility
Natural resources are essential for the production and consumption of our products. We rely particularly on agriculture, fi sh and water: agriculture provides three quarters of our raw materials, fi sh products are leading product lines for our frozen food brands and water is essential for the manufacture and use of our products. Therefore, for the future of our supply chain – and the wider environment – we are committed to working towards sustainability in these three areas.

In 2001, we made considerable advances in our pioneering initiative to develop standards for sustainable agriculture. Following extensive international pilot projects, we drafted provisional guidelines for sustainable tea and palm oil production. We are now working on guidelines for peas, spinach and tomatoes.

During the year, we included sustainably sourced white fi sh in our frozen foods for the fi rst time. Products including this fi sh now carry the Marine Stewardship Council logo. This is

Unilever Annual Report & Accounts and Form 20-F 2001

another step towards our target of sourcing all fi sh from sustainable stocks by 2005.

In water care, we continued to work to secure safe, sustainable water resources. We published, and widely promoted, the SWIM (Sustainable Water and Integrated Catchment Management) guidelines. These provide a practical framework for working with partners on water stewardship schemes.

In 2000, which is the most recent year for which we have data, our targets on environmental management were largely achieved. We continued to reduce the environmental impact of all our key performance indicators, including water, energy and carbon dioxide. We met four of six challenging eco-ef fi ciency targets in our manufacturing operations. This was achieved with an increase in production tonnage. During 2001, we introduced new software tools to allow us to collect and publish environmental data more swiftly.

Operational responsibility for environmental issues rests with the operating companies and with individuals responsible for the particular Unilever facility. They are supported by our environmental decision-making committee, the Unilever Environment Group (UEG). This is Unilever ’ s leading body for making recommendations addressing environmental issues. It is chaired by the Corporate Development Director and made up of representatives from Business Groups and safety, health and environmental experts. Its role is to develop strategies to continuously improve Unilever ’ s environmental performance and to communicate its recommendations to Unilever facilities worldwide.

In pursuing our environmental strategy, we work closely with external interest groups. For example, our sustainable agriculture initiative is based on performance indicators devised following extensive stakeholder involvement and its progress is monitored by an independent board of experts. Our sustainable fi sh and water care initiatives are also rooted in partnerships.

For the third consecutive year we topped our industry sector in the Dow Jones Sustainability World Indexes.

Our Environment Report is available at www.unilever.com .

Responsible corporate behaviour
Responsible corporate behaviour is central to Unilever ’ s business management and is part of the remit of our Corporate Development Director.

In 2001, we made our approach to corporate social responsibility more explicit with the publication of our fi rst international Social Review, which can be viewed at www.unilever.com . The review maps out how we interact with society and the many different stakeholders with an interest in our business. Learning from this fi rst Review, and from the many reporting initiatives in this area, work is underway to update the information during 2002.

Unilever ’ s commitment to high standards of corporate behaviour is spelt out in our Code of Business Principles, which is set out on page 6. The Code sets the framework for our operational standards, covering issues such as employee health and safety, product quality, relations with governments, ethical behaviour and environmental impact. It is applicable worldwide and is designed to have practical value to our employees in the day-to-day management of our business: each employee must follow these principles in the spirit as well as the letter. In 2001, we updated the Code in line with the evolving standards expected of international companies. The new Code is being rolled out in 2002.

Debate about the appropriate extent of corporate social responsibility has continued. By meeting the needs of consumers worldwide, Unilever ’ s branded products and services help to raise living standards and improve quality of life. Our operations add value by ef fi ciently processing raw materials and effectively marketing and distributing our brands. This value is then shared among our many stakeholders worldwide including shareholders, employees, suppliers and governments. Communities also bene fi t through our voluntary contributions. In 2001, we spent approximately € 57 million on community programmes, focusing on projects that improve healthcare, raise levels of education and encourage local economic, environmental and cultural activity.

Competition
We have a wide and diverse set of competitors in our consumer goods businesses. Many of our competitors also operate on an international scale, but others have a narrower regional or local focus.

Competition is intense and challenging. We aim to compete and give value to our consumers and customers in three ways:

We support efforts to create a more open competitive environment through the liberalisation of international trade. We also support the fuller implementation of the Single European Market and inclusion of other European countries in the European Union.

Exports
We sell our products in nearly all countries throughout the world and manufacture in many of them. Inside the European Union we make many of our products in only a few countries, for sale in all of them.

We also export a wide range of products to countries where we do not make them. We often use this export trade to develop new markets before building local manufacturing facilities, usually through our facilities in neighbouring countries.

Unilever Annual Report & Accounts and Form 20-F 2001

Seasonality
Certain of our businesses, such as ice creams and prestige fragrances, are subject to signi fi cant seasonal fl uctuations in sales. However, Unilever operates globally in many different markets and product categories. No individual element of seasonality is likely to be material to the results of the Group as a whole.

We are committed to building an enterprise culture: one that acts as a springboard for individual and business success.

To help build this culture, in 2001, we ran a series of challenging international events for both rising and established managers. At these workshops, people worked on their collective behaviours against stretching business targets. Subsequently, local events were used to build this culture.

We reshaped our business, moving to a divisional structure and integrating the research and development functions into the divisions. In line with our strategy, these changes will allow us to direct our efforts more effectively behind our leading brands. The programme of disposals announced in 2000 as part of our brand focus, and the planned synergy savings from the Bestfoods integration, have both progressed well. These initiatives led to a reduction of some 30 000 staff over the year. We remain committed to dealing openly and fairly with all those affected.

Our leadership development focuses on building the skills required to achieve our business goals. In 2001, we extended the Leaders into Action pilot programme to a wider group of managers. The programme, which is part-residential and part-online, includes personal, business and community elements.

We also successfully launched ‘ open job posting ’ . By communicating management vacancies company-wide, this system ensures that selection is fair and transparent. It was rolled out globally early in 2002.

In 2001, we extended the Reward for Growth programme and as a result over 6 000 managers worldwide qualify for executive share options and a new global variable pay scheme linked to growth. It is planned to extend the variable pay scheme to a further 15 000 employees.

Related party transactions
Other than those disclosed in these accounts, there were no related party transactions that were material to the Group or to the related parties concerned that require to be reported in 2001 or the preceding two years. Transactions with related parties are conducted in accordance with the transfer pricing policies described on page 53 and consist primarily of sales to joint ventures. Information concerning guarantees given by the Group is stated in note 23 on page 75 and under ’ Mutual guarantee of borrowings ’ on page 109.

Intellectual property
We have a large portfolio of patents and trademarks, and we conduct some of our operations under our patents or under licences which are based on patents or trademarks owned or controlled by others. We are not dependent on any one patent or group of patents. We use our best efforts to protect our brands and technology.

Description of our properties
We have interests in properties in most of the countries where there are Unilever operations, however, none is material in the context of the Group as a whole. The properties are used predominantly to house production and distribution activities and as of fi ces. There is a mixture of leased and owned property throughout the Group. There are no environmental issues affecting the properties which would have a material impact upon the Group. The directors take the view that any difference between the market value of properties held by the Group and the amount at which they are included in the balance sheet is not signi fi cant. See the schedule of principal group companies and fi xed investments on page 97 and details of tangible fi xed assets in note 10 on page 65.

Legal and arbitration proceedings
We are not involved in any legal or arbitration proceedings and do not have any obligations under environmental legislation which we expect to lead to a loss material in the context of the Group results. None of our directors or of fi cers are involved in any such material legal proceedings against us.

Government regulation
Unilever businesses are governed, in particular, by national laws designed to ensure that their products may be safely used for their intended purpose and that their labelling and advertising complies in all respects with relevant regulations. The introduction of new products and ingredients and processes is, speci fi cally, subject to rigorous controls. Unilever businesses are further regulated by data protection and anti-trust legislation. Important regulatory bodies include the European Commission and the US Food and Drug Administration.

Unilever Annual Report & Accounts and Form 20-F 2001

Basis of reporting and discussion
The commentary throughout this operating review is, unless otherwise indicated, based on the results of the Group including acquisitions made each year, at constant rates of exchange and before exceptional items and amortisation of goodwill and intangibles (BEIA). It is also based on Total turnover and Total operating profit. The term ‘Total’ means Group turnover (and operating profit) plus Unilever’s share of the turnover (and operating profit) of joint ventures, net of Unilever’s share of any sales to those joint ventures already included in the Group figures.

Our accounting policies are based on United Kingdom generally accepted accounting principles (GAAP) and Netherlands GAAP which differ in certain respects from United States GAAP. The principal differences are described on page 95. We have shown reconciliations to net income and capital and reserves under US GAAP on pages 94 and 95.

Reporting currency and exchange rates
From 1 January 2000, Unilever adopted the euro as its principal reporting currency. For the years prior to the introduction of the euro on 1 January 1999, euro values have been derived by converting values previously reported in guilders using the official conversion rate announced on 31 December 1998 of € 1.00 = Fl. 2.20371. The effect of exchange fluctuations over time means that the trends shown may differ significantly from those previously shown in sterling and from those which would arise if these euro amounts had been translated from the historic sterling accounts.

Foreign currency amounts for results and cash flows are translated from underlying local currencies into euros using annual average exchange rates; balance sheet amounts are translated at year-end rates except for the ordinary capital of the two parent companies. These are translated at the rate prescribed by the Equalisation Agreement of £1 = Fl. 12, and thence to euros at the official rate of € 1.00 = Fl. 2.20371 (see Control of Unilever page 107).

To eliminate the effect of exchange rate fluctuations in the following discussion, we have expressed certain of our key year-on-year comparisons at constant rates of exchange. This means using the annual average rates for the prior year. For each two-year period, the year-on-year comparisons in euros are the same as those which would arise if the results were shown in sterling or US dollars at constant exchange rates.

For the reporting of 2000 at current exchange rates, the results of the Bestfoods business acquired on 4 October of that year were translated at the average rates of exchange for the last quarter of 2000. In the constant rate comparisons for 2001 included in the Operating Review on pages 14 to 27, the results for all parts of the Group have been translated at average rates of exchange for the full year to 31 December 2000. This means that the 2000 results in these comparative tables will differ in some cases from the values translated at current rates of exchange.

Details of exchange rates used in preparation of these accounts and of the noon buying rates against the US dollar are given on page 93.

2001 results compared with 2000
Total turnover increased by 11% to € 53 400 million. This increase was the result of an acquisition impact of 12%, a disposal impact of (5)% and underlying growth of 4%.

Total operating profit BEIA increased by 28% to € 7 416 million, and total operating margin BEIA rose to an historic high of 13.9% from 12.0% in 2000. The improvement in margin primarily reflects the ongoing contribution from Path to Growth restructuring and procurement savings and the successful integration of Bestfoods.

Total operating profit increased by 60% to € 5 360 million, being primarily the net impact of acquisitions and disposals offset by an increase in the amortisation charge.

Exceptional items
Exceptional items for the year were € 620 million, which includes € 1 564 million of restructuring investment and profits on disposals of € 944 million. Of the latter, € 828 million relates to the profit on the sale of the brands to secure regulatory approval for our acquisition of Bestfoods and € 116 million in respect of the sale of Unipath. Associated costs included in operating profit were € 393 million for the year.

The exceptional items incurred in the year primarily relate to the Path to Growth programme we announced on 22 February 2000 to accelerate growth and expand margins, and to restructuring arising from the integration of Bestfoods. The aggregate cost of these programmes is estimated to be € 6.2 billion, the majority of which is expected to be exceptional. The € 828 million profit on the sale of brands to secure regulatory approval for the acquisition of Bestfoods is not part of this amount.

Unilever Annual Report & Accounts and Form 20-F 2001

Details of movements in all restructuring provisions are given in note 18 on page 73.

Under US GAAP, certain of the restructuring charges in each year would not have been recognised until certain additional criteria had been met, and would then have been included as a charge in subsequent years. Details of the US GAAP adjustments relating to the restructuring charges are given on pages 94 and 95.

Amortisation of goodwill and intangibles
The amortisation charge was € 1 436 million compared with € 435 million in 2000. This includes € 1 186 million for Bestfoods. The increase arises because 2001 includes a full year charge for acquisitions made part way through 2000.

2000 results compared with 1999
Total turnover increased by 7% to € 44 224 million at constant 1999 exchange rates. Of the increase, 5% related to the net impact of acquisitions and disposals in the year, and there was underlying volume growth of 2%, double the rate of growth achieved in 1999.

Total operating profit BEIA increased by 16% for the year. Of this increase, 7% related to the impact of acquisitions and the remainder reflects benefits arising from restructuring.

Total operating margin BEIA was at an historic high of 12.1%.

Total operating profit decreased by 27% as a result of significant exceptional items and an increase in the amortisation charge of € 371 million as a result of acquisitions in the year.

Exceptional items
Included in operating profit in 2000 was a € 1.8 billion exceptional charge and € 100 million of associated costs in relation to the Path to Growth programme, € 1.1 billion relating to restructuring and € 0.7 billion for other items, principally business disposals. The key disposals were the European bakery business, which gave rise to a profit of € 149 million and the sale of Elizabeth Arden, completed in January 2001, which gave rise to the recognition of a loss of € 742 million after writing back goodwill which was charged direct to shareholders’ funds on the acquisition of the business in 1989. Exceptional items also include approximately € 100 million in relation to restructuring arising from the integration of Bestfoods.

Amortisation of goodwill and intangibles
The amortisation charge increased by € 371 million to € 394 million as a result of the significant acquisitions made during the year. Of the charge for the year, € 274 million related to Bestfoods.

Acquisitions and disposals
No significant acquisitions were made during 2001. In 2000 we made 20 acquisitions, of which the most important were:

In 2001 we disposed of 33 businesses for a total consideration of approximately € 1 653 million. In addition, the Bestfoods Baking Company and other Bestfoods businesses were disposed of for a consideration of € 1 968 million. The most significant disposals are detailed below.

For further information on the impact of acquisitions and disposals please refer also to the Cash Flow section of the Financial Review on page 30.

On 24 January 2001 we announced the completion of our sale of the Elizabeth Arden business for a consideration of approximately € 244 million. Sales turnover of this business was approximately € 600 million in 2000.

Following the approval of the European Commission, the sale of several of our European dry soups and sauces businesses to the Campbell Soup Company was completed on 4 May 2001, for a debt free price of € 1 billion. These businesses were sold as a result of undertakings given to the European Commission in connection with Unilever’s acquisition of Bestfoods in 2000. Annual sales of these businesses totalled approximately € 435 million, and sales for the period from 1 January 2001 to the date of disposal were approximately € 190 million.

On 2 October 2001 we announced the completion of the sale of our North American seafood business to Nippon Suisan (USA), Inc., a subsidiary of Nippon Suisan Kaisha Limited for $175 million. This business included the Gorton’s business in the United States and the BlueWater Seafoods business in Canada. Together the businesses had net sales of € 272 million in 2000, and sales for the period from 1   January 2001 to the date of disposal were approximately € 190 million.

Unilever Annual Report & Accounts and Form 20-F 2001

On 20 December 2001, we completed the sale of Unipath Limited, our women’s health diagnostics business, to Inverness Medical Innovations Inc. for £103 million ( € 166 million) in cash.

In addition to the above disposals, on 31 July 2001 we announced the completion of the sale of the Bestfoods Baking Company to George Weston Limited for $1.77 billion. The assets and liabilities of this business, after adjustment to their proceeds of sale, were included within the balance sheet at 31 December 2000 as acquired businesses held for resale. Therefore the results of this business were not consolidated in the Group results in 2001.

On 8 January 2002, we announced a definitive agreement for the sale of our Unimills refinery business at Zwijndrecht, the Netherlands, to Golden Hope Plantations Berhad of Malaysia, for approximately € 60 million in cash. This business has annual sales to third parties of approximately € 130 million.

In 2000 we disposed of 27 businesses for a total consideration of approximately € 642 million. Disposals included the European Bakery Supplies Business, Benedicta, a culinary business in France, and various other smaller businesses and brands.

We have also announced our intention to dispose of the following businesses:

On 31 May 2001, we announced plans to sell a number of North American food brands and related assets from the Bestfoods portfolio, primarily cooking oil products, corn starches, commodity oils and syrups. Also included in the planned sale were the Rit dye and Niagara starch fabric care brands. In total these brands have combined annual sales approaching $400 million.

On 20 November 2001, we announced an agreement to sell our DiverseyLever institutional and industrial cleaning business to Johnson Wax Professional. The total value of the transaction to Unilever is $1.6 billion ( € 1.75 billion). Unilever will retain a one-third holding in the combined business. Cash proceeds of the sale are expected to amount to $1 billion ( € 1.1 billion). Sales for the year to 31 December 2001, excluding sales of the consumer brands which Johnson Wax Professional will distribute for Unilever under a separate sales agency agreement, were approximately $1.5 billion ( € 1.7 billion).

Public takeover offers made by Unilever during 2001 and 2000 related to the following acquisitions:

On 14 March 2000, following a joint offer by Unilever and its subsidiary Hindustan Lever Limited (HLL) for the 34.97% of the shares in Rossell Industries Limited, India, not already owned by Unilever, Lipton India Exports Limited, a wholly owned subsidiary of HLL acquired 24.59% of the shares for a consideration of € 10.4 million.

On 15 May 2000, following an all cash public tender offer, Unilever, through its US subsidiary, Conopco, Inc., acquired Ben & Jerry’s Homemade, Inc. for an aggregate consideration of € 345 million.

On 4 October 2000, following an all cash public merger transaction, Unilever, through its subsidiary, Unilever United States, Inc., acquired Bestfoods for an aggregate consideration of € 26 083 million.

On 23 January 2001, following an offer, made in November 2000, through its subsidiary, Hindustan Lever Limited, for the 24.62% of the shares in International Bestfoods Limited India not already owned by Bestfoods, Unilever acquired 7.99% of the shares for a consideration of € 2 million.

On 31 January 2001, following an offer made in October 2000 by Unilever through its Tunisian subsidiary, Société de Cosmetiques Détergent et Parfumerie, for the 9.21% of the shares in Société de Produits Chimiques Détergents not already owned by Unilever, 8.1% of the shares were acquired for a consideration of € 4 million.

On 4 December 2001, following a further joint offer by Unilever and its subsidiary, Hindustan Lever Limited, for the remaining 10.38% of the shares in Rossell Industries Limited, India, not acquired in March 2000 (see above), Lipton India Exports Limited, a wholly owned subsidiary of HLL acquired a further 6.27% of the shares for a consideration of € 1.8 million, which brings the Group’s aggregate holding in Rossell Industries to 95.89%.

2001 results compared with 2000 at constant 2000 exchange rates

Sales were ahead in the year by 6% with an underlying sales growth of 4%. Growth was broad-based and included a strong contribution from Central and Eastern Europe.

Total operating margin BEIA increased to 14.7% in Europe due to restructuring, buying and marketing-support efficiencies, and portfolio improvement.

Western Europe
The success of pro • activ , Culinesse and Bertolli in spreads and cooking products, the 4 Salti in Padella range of high-quality frozen ready meals and the expansion of Slim • Fast , led to a step-up in the growth rate for Foods. Cornetto and Carte d’Or both grew strongly through innovation, whilst in culinary there was continued momentum in Amora Maille and we started to see the strength of the Knorr brand.

In personal care, the leading brands maintained their good rate of growth, led by range extensions in Dove and Signal and by Rexona . Dove shampoo was launched in eight countries by the end of the year and the initial response has been very positive. The success of the Vaporesse ironing aid in fabric conditioners together with a solid response to a more competitive environment in fabric wash helped laundry to grow. We continued to enjoy good rates of growth in Domestos and Cif through the success of easy-to-use wipes and the launch of Domestos Bi-Actif and Domestos WC Active Mousse.

Western Europe
In Western Europe, our Home and Personal Care business achieved sales growth of 3%.

Progress was led by our Dove brand which grew by 18%, boosted by new range extensions. Further impetus to growth came from a range of innovative launches, including colour laundry tablets, Domestos/Cif easy-to-use wipes, Easy Iron fabric conditioner and new variants of Axe/Lynx deodorant.

Foods in Western Europe had a mixed year as sales of ice cream and beverages suffered from a poor summer season. It was a more encouraging story in the other categories, leading to overall growth of 3%. In spreads and cooking products, volumes developed favourably with the introduction of Flora/Becel pro • activ cholesterol-lowering spread. Bertolli blended olive oil spreads added momentum in the second half of the year. The culinary products business performed well, led by the continuing growth of Sizzle & Stir cooking sauces and the sales of Amora Maille which were 7% ahead of last year. In frozen foods, our 4 Salti in Padella range of high-quality ready meals brought innovation and growth to the sector. Our planned exit from low margin commodity businesses reduced sales but improved margins. Our tea business grew with the roll-out of pyramid tea bags and Lipton Tchaé .

The overall sales level in Western Europe also reflected our disposal of under-performing businesses, including the sale of our European bakery operation.

Unilever Annual Report & Accounts and Form 20-F 2001

Central and Eastern Europe
There was a modest improvement in overall market conditions. Personal care achieved high single digit volume growth, driven by deodorants and hair products. Overall, lower prices held back sales growth, as we passed on lower edible oil input costs, repositioned our spread and tea brands in Russia and responded to competitive pressures in spreads and laundry in Poland.

2001 results compared with 2000 at constant 2000 exchange rates

Sales were ahead by 16% with an underlying growth of 2%. In our Home and Personal Care mass business underlying sales growth was 2.5%, skewed towards the fi rst half of the year, due to the phasing of innovation. There were good performances by our brands across the skin, hair and deodorant categories, notably Dove and Suave.

In Prestige fragrance our sales declined, re fl ecting both the sale of Elizabeth Arden and weaknesses in department stores and travel retail following the tragic events of 11 September. The decline in underlying sales reduced the overall North American growth rate by nearly 1%.

Our Foods business recorded an underlying sales growth of just over 3% for the year.

The integration of Ben & Jerry ’ s proceeded well and sales grew 8% in the year. This, together with strong sales of Breyers , Popsicle , Klondike and Good Humor , further strengthened our market leadership. Slim • Fast continued to expand and is now close to € 1 billion sales globally. Spreads grew with the introduction of calcium variants of the Shedd’s and I Can’t Believe It’s Not Butter! ranges. In culinary products, sales were fl at due to competitive activity and our focus on integration. In tea, sales declined as we focused on brand convergence and transition to our common global positioning.

Total operating margin BEIA of 14.2% re fl ects the bene fi ts of portfolio change, restructuring, global procurement and marketing-support ef fi ciencies.

2000 results compared with 1999

Sales rose by 13%, with a strong contribution from Bestfoods, Slim • Fast and Ben & Jerry ’ s. Operating margins showed a signi fi cant increase, as the bene fi ts of restructuring, portfolio improvement and procurement savings came through. Although Bestfoods ’ sales in the fourth quarter were around € 100 million short of our expectations, this was largely as a result of action taken to reduce trade inventories in the United States in both the retail and foodservice channels.

In Foods, our ice cream, tea and culinary products businesses achieved good sales growth. In ice cream, the most signi fi cant contributions came from the Breyers Parlor take home range and from new Popsicle and Klondike novelties. In culinary products, Lipton meal makers, driven by Sizzle & Stir, led the advance, while Lipton Cold Brew was a key player in tea ’ s success. In the US, we successfully launched a creamy fruit variant of Brummel & Brown spreads.

Unilever Annual Report & Accounts and Form 20-F 2001

In Home & Personal Care, volumes grew by 4% as a result of an active and strongly supported innovation programme.

Dove, Caress and Suav e led growth in personal care and in hair care we have relaunched Salon Selectives .

Our fabric care business maintained its overall market position, despite price competition, and the launch of laundry tablets began well.

In our Prestige fragrance business we sold much of the Elizabeth Arden business and launched Nautica and Calvin Klein Truth .

2001 results compared with 2000 at constant 2000 exchange rates

Sales grew by 10% with an underlying growth of 7%. Price increases have had priority to protect margins in countries where there has been devaluation, in particular South Africa and Turkey. Growth is broad-based across our brands, with the strongest country contributions coming from South Africa, Nigeria, Ghana and Morocco. There were good performances by Omo , relaunched with an improved formulation, Close-up in West Africa, where we continue to strengthen our position in oral care, and by Dove .

Total operating margin BEIA at 11.0% is ahead of last year, re fl ecting focused management in challenging economic conditions.

2000 results compared with 1999

In Africa, Middle East and Turkey, overall sales were up by 2%, with pro fi ts increasing by 13%.

The momentum in Africa was driven by progress across all our key categories, with particularly strong performances from laundry, oral care, deodorants and culinary products. We increased the direct coverage of outlets with the roll-out of a distribution model based on our experience in rural India.

In South Africa, we introduced laundry tablets, with other innovative launches including Omo liquid bleach, Flora pro • activ and Lipton Ice Tea .

Unilever consumer product businesses are being supplied with innovative tea products from our East African plantations.

In the Middle East, sales stagnated in adverse business conditions and we concentrated on maintaining market positions.

2001 results compared with 2000 at constant 2000 exchange rates

Total sales grew by 6% with underlying sales ahead by the same amount.

In South East Asia and Japan, sales growth exceeded 10%. Notable were: a strong performance in Japan with the successful launch of Dove shampoo; Lipton ready-to-drink tea through the alliance with Suntory; and our skin business through Dove . In South East Asia our personal care brands powered ahead in all countries led by new variants of Sunsilk , and in Indonesia there was increased market penetration for Rexona and excellent performances from Citra and Pepsodent following its relaunch.

In India, the more focused brand portfolio delivered improved growth and pro fi tability. There were particularly strong performances by Sunsilk and Clinic in hair, Rin and Wheel in laundry, and Fair and Lovely range extensions in skin care. In Foods, sales have been fl at as we have been aggressively improving margins and eliminating poor-performing brands.

In China, there was substantial progress towards pro fi tability.

Total operating margin BEIA for the year has advanced to 13.5% re fl ecting the bene fi ts of global procurement, improved Foods pro fi tability and a stronger mix through the growth in personal care.

2000 results compared with 1999

Sales in the year were 8% ahead of 1999, driven by excellent performances in South East Asia and Japan. Pro fi tability rose signi fi cantly across the region, while at the same time we maintained a high level of marketing support.

Our businesses in South East Asia and Japan generated double digit sales growth in each quarter. Progress was broad-based, in both category and geography.

In skin care and hair care, innovation and strong marketing support levels helped us to good results. Brand successes included the performance of Dove, Pond’s, mod’s hair and Lux in Japan and Vaseline shampoo in the Philippines. In Australasia, we achieved sales growth in ice cream and gained market share in laundry.

In China, a repositioned Omo and new variants of Zhonghua toothpaste helped both brands achieve volume growth above 20%. In Taiwan, Dove shampoo vied for the number one market position.

We made further progress in sales of consumer brands in India as our renewed focus on building mass market share began to have an impact. At the premium end of the laundry market, Surf continued to perform well. Overall sales revenues were affected by our exit from the imported fertiliser business and by the impact of lower edible oil prices.

2001 results compared with 2000 at constant 2000 exchange rates

Total sales moved ahead by 27% with an underlying sales growth of 5%.

A key feature of the year has been our determination to move prices to recover devaluation-driven cost increases and so protect our margin structure.

Mexico sustained strong growth throughout the year. The key drivers have been: Sedal , which reached an 8% share in the hair care market in its fi rst year since launch; further progress in spreads, deodorants and skin care; and a successful expansion of Holanda ice cream.

In Argentina, markets declined as consumer income reduced, however, our market shares remain strong. In Brazil, overall volumes were impacted by energy restrictions and devaluation-related price increases but continuing innovation in hair and deodorant delivered volume growth.

Total operating margin BEIA for the year at 13.0% is ahead of last year re fl ecting the bene fi ts of portfolio change, global procurement, savings from Bestfoods ’ integration and improved ice cream pro fi tability.

2000 results compared with 1999

Sales growth for the year of 14% re fl ected a signi fi cant contribution from Bestfoods and other acquisitions. There were encouraging signs of growth in Brazil, while Mexico continued to perform strongly. Recovery was slower in Argentina and North Latin America.

In laundry, volume growth progressed during the year with share gains in Brazil and Argentina. In personal care, brand focus continued to deliver very good progress in Brazil.

In Foods, growth was spurred by an excellent performance in our Mexican business in ice cream, spreads and culinary. We also saw the fi rst signs of recovery in our ice cream operations in Brazil.

Unilever Annual Report & Accounts and Form 20-F 2001

The Foods division was established in January 2001 and we have made excellent progress in building and transforming our Foods business.

We rapidly integrated Bestfoods, together with Slim • Fast, Ben & Jerry ’ s and Amora Maille. The integration achieved all the synergy targets, realising savings of over € 400 million, and we are on course to complete most of our operational integration by early 2002.

The new business delivered solid growth thanks to a more focused portfolio of leading brands and despite challenging economic conditions in many of our key markets. Overall sales grew by 20%, with a signi fi cant increase coming from the recent acquisitions of Bestfoods, Slim • Fast, Amora Maille and Ben & Jerry ’ s. Excluding the impact of acquisitions and disposals, underlying sales growth was 3%.

Total operating pro fi t BEIA rose by 49% and margins reached 14.3% re fl ecting the bene fi ts from the Path to Growth restructuring programme and Bestfoods synergy savings.

The culinary category, thanks to the acquisitions, grew to become Unilever ’ s biggest while pro fi t margins increased very signi fi cantly. In addition, Unilever ’ s spreads operations, which returned to sales growth after a period of decline, and our ice cream and frozen foods business, which increased its pro fi ts sharply following restructuring, performed particularly well. Our performance in the fast-growing foodservice arena and in developing and emerging markets demonstrate our increased potential in these sectors.

The greater size, scope and global reach of the new business enhances our ability to deliver bene fi ts of scale and to achieve our vision of becoming the world ’ s leading food company.

On pages 20 to 23 is a review of performance in each major product category. Included in the fi gures for each category are the results of two areas that are important to Unilever:

Health and wellness
Consumers are increasingly demanding healthy food products. In 2001, our brands grew by meeting such needs, in both industrialised and developing markets.

The US-based Slim • Fast range, which we market as a nutritionally responsible way to achieve and maintain a healthy weight, delivered excellent growth. We successfully extended the brand beyond its US heartland, with launches in Australia and the Netherlands and relaunches in Canada and the UK. We also extended the range into soups.

A pro fi table year for Annapurna in India and a successful African roll-out from Ghana to C ô te d ’ Ivoire shows how we meet a very different consumer need: for nutritionally-enhanced staples at an affordable price. Sales of AdeS soydrinks in Latin America were hit, however, by the economic dif fi culties in the region.

Foodservice
The integration of Bestfoods into Unilever created one of the world ’ s leading foodservice businesses, providing solutions for chefs, restaurateurs, caterers and fast food retailers. Unilever Bestfoods foodservice operates in more than 60 countries and is market leader in our target categories.

While sales performance rallied towards the end of 2001, there was a slight decrease in turnover in foodservice during the year, due to a complex integration challenge, adverse economic conditions, and setbacks in some larger countries, including France, Germany and the UK. However, we enjoyed double-digit growth in many smaller national markets and we improved pro fi t margin overall.

We are con fi dent that foodservice will ful fi l its potential as a major growth and innovation driver for the Foods division.

2001 results compared with 2000 at constant 2000 exchange rates

Unilever is the world ’ s leading supplier of branded margarine, spreads and olive oil.

In 2001, consumer-focused innovation made our spreads turnover grow again and our total market share improved by about 1%. Total operating pro fi t BEIA increased by 27%, with particularly good performances in Germany, the Netherlands and the UK.

Our ability to satisfy consumer demand for healthy foods was key to our success. Pro • activ , which includes ingredients that can help to reduce levels of ‘ bad ’ cholesterol, showed very impressive growth across Europe. Culinesse , a high-performance, easy-to-use, liquid cooking product, was successfully launched in 11 European countries.

In the US, an enterprising, cross-functional initiative that looked at all aspects of margarine marketing captured the imagination of consumers and boosted sales. I Can’t Believe It’s Not Butter! grew particularly strongly.

Our European dairy spreads, marketed under Brunch , Boursin and Crême Bonjour , continued to grow. Spreads in most Eastern European countries recovered well, although the Russian market remained dif fi cult.

Overall sales in olive oil declined mainly due to the disposal of the unpro fi table La Masia business in Spain but pro fi tability increased signi fi cantly. This was mainly driven by the continued success of Bertolli , which again enjoyed good volume growth, especially in Western Europe. Recognising the consumer appeal of healthy Mediterranean-style food, we introduced Bertolli dressings in the Netherlands and brought Five Brothers pasta sauce in the UK and US, and Olivio spreads in the UK, under the Bertolli umbrella.

We sold the Bestfoods Baking Company in July 2001. As a result of this and the divestment of European Bakery Supplies in 2000, Unilever has now disposed of the majority of its bakery business.

2000 results compared with 1999

Margins improved, re fl ecting lower raw material costs and the continued bene fi ts from supply chain improvements.

In many countries, we increased our share in margarine and related cooking products. Against the background of a declining market, our volumes were on par with last year. Our cholesterol-lowering spreads Flora/Becel pro • activ were launched with great success in ten European countries, following clearance from the European Union. By the end of the year, the spreads were available in 16 countries around the world.

In margarines, consumers responded positively to the addition of micro-nutrients and calcium to some of our main brands, including Blue Band and Country Crock .

Unilever Annual Report & Accounts and Form 20-F 2001

The dairy spread and olive oil categories are growing at an annual rate of 4%. We are developing these categories as part of our strategy to stimulate growth. In 2000, new range extensions increased sales of our Brunch and Crême Bonjour dairy spreads. In the United States, Brummel & Brown yoghurt-based spreads achieved double-digit growth, following the launch of creamy fruit variants.

Bertolli – the world ’ s leading olive oil – grew in all markets and was launched in fi ve new Northern European countries. It is being extended actively into spreads, cooking products and dressings.

In October 2000, we sold our European Bakery Supplies business. This followed a strategic review of the business, fi rst announced as part of our Path to Growth strategy. The review concluded that the interests of the business, and its employees, would be better served by joining a group with a core interest in bakery.

Ice cream and beverages

2001 results compared with 2000 at current exchange rates

2001 results compared with 2000 at constant 2000 exchange rates