MARKETING REPORT:

PRESENTED BY:

M.SAAD.KHAN

(STUDENT OF MBA IN FEDERAL URDU UNIVERSITY)

SUBMIITED TO:

SOHAIL PASHA

DEDICATE OF THIS REPORT:

1. THIS REPORT IS DEDICATED TO MY ALLAHA AFTER THE DEDICATION TO MY ALLAHA.

2. THIS REPORT IS DEDICATED TO THE HOLY PROPHET “HAZRAT MUHAMMED [P.B.U.H]”. HE IS GREAT PHILOSPHER AND LEADER HAVE NEVER CAN SEE TO THE WOLRD

3. ALSO DEDICATED TO MY PARENTS, ALL TEACHER & ALL MY FRIENDS.

4. AND ALSO DEDICATED TO “DOCTOR ABDUL QADIR KHAN”. HE IS GREAT SCIENTIST HEVER PRODUCE TO PAKISTAN.

ACKNOWLEDGEMENT:

HELP ME TO MAKE THIS REPORT TO DIFFERENT ASPECTS.THIS DIFFERENT ASPECTS ARE FOLLOWING BELOW:

1. www.wikipedia.com 2. www.RAFAHAAN FOOD.com 3. www.solidpaper.com 4. www.bussinessweak.com 5. www.reportlinker.com

EXECUTIVE SUMMARY

This report is “RAFAHAN FOOD” which is one of the largest company in the PAKISTAN .

IMPORTANCE:

IN this report me as a researcher .I try to find the what is the key which have selected to coca cola company and the success has fell in his feet. I thing as a researcher I guess the coca cola company have work this 6 question. These questions is defined as given world:

1. What is plan have choose the rafhan food company ? 2. Which is method to choose to achieving the plan? 3. Where is the marketing activity now days of rafhan food? 4. Who is monitoring of financial aspects of rafhan food? 5. When at the present time the goodwill of rafhan food? 6. How the grow the market share of company?

TABLE OF CONTENT:

NO

NAME OF TOPIC: PG NO

1 INTRODUCTION OF COMPANY

2 MISSION STATEMENT

3 VISION STATEMENT

4 MANGERIAL LEVEL

5 SWOT ANALYSIS

6 DEMOGRAPHICAL ENVIROMENT

7 FINANCIAL CONDITION

8 PRODUCT AND SERVICE

9 PRODUCT PORT FOLIO

10 CATER PLAN

11 IMPORTANCE OF DEPARTMENT

12 PRODUCTS

13 OFFERD BY RBFL

14 PRODUCT LAUNCHING

15 MARKET SHARE

16 CONCULSION&RECOMMANDATION

REPORT:

IINNTTRROODDUUCCTTIIOONN OOFF OORRGGAANNIIZZAATTIIOONN

TThhee ccoommppaannyy wwaass eessttaabblliisshheedd iinn eeaarrllyy 5500’’ss bbyy MMuunnnnoo FFaammiillyy.. RRAAFFHHAANN wwaass nnaammeedd ffrroomm tthhee ccoommbbiinnaattiioonn ooff tthheeiirr ttwwoo ssoonnss,, RRaaffiiqq && FFaarrhhaann.. AAtt tthhaatt ttiimmee

tthhee ccoommppaannyy uusseedd ttoo ddeeaall bbootthh wwiitthh iinndduussttrriiaall ggooooddss && ccoonnssuummeerrss ggooooddss.. IInn 9900’’ss aa mmuullttiinnaattiioonnaall ccoommppaannyy CCPPCC ppuurrcchhaasseedd iitt ffrroomm MMuunnnnoo FFaammiillyy && nnaammeedd iitt CCPPCC RRaaffhhaann.. TThheenn tthheerree ccaammee aa cchhaannggee && CCPPCC ddiivviiddeedd iinnttoo ttwwoo ppaarrttss,, ii..ee..::

IInndduussttrriiaall GGooooddss

CCoonnssuummeerr GGooooddss

TThhee sseeccttoorr tthhaatt pprroodduucceedd iinndduussttrriiaall ggooooddss wwaass nnaammeedd aass RRaaffhhaann NNaaiizzee PPrroodduuccttss && tthhee sseeccttoorr tthhaatt pprroodduucceedd ccoonnssuummeerr ggooooddss wwaass nnaammeedd aass RRaaffhhaann BBeesstt FFooooddss..

MMIISSSSIIOONN SSTTAATTEEMMEENNTT::

IInn OOccttoobbeerr,, 22000000,, BBeesstt FFooooddss wwaass ppuurrcchhaasseedd bbyy LLeevveerr BBrrootthheerrss //UUnniilleevveerr aallll oovveerr tthhee wwoorrlldd.. TThhee ddeeaall wwiillll bbee tthhee llaatteesstt iinn aa sseerriieess ooff aaccqquuiissiittiioonnss ffoorr UUnniilleevveerr,, wwhhiicchh hhaass ppuurrssuueedd BBeesstt FFooooddss iinn oorrddeerr ttoo ccaappttuurree mmoorree ttoopp--nnaammee bbrraannddss aanndd bboooosstt rreevveennuuee ggrroowwtthh.. IItt ccoommeess aatt aa ttiimmee wwhheenn UUnniilleevveerr iiss ssttrreeaammlliinniinngg iittss mmaassssiivvee ffoooodd,, ddeetteerrggeennttss aanndd ppeerrssoonnaall pprroodduuccttss bbuussiinneessss.. TThhee ffiivvee--yyeeaarr ppllaann ccaallllss ffoorr iinnccrreeaasseedd ooppeerraattiinngg mmaarrggiinnss,, jjoobb ccuuttss aanndd rreevveennuuee eennhhaanncceemmeennttss..

NNiiaallll FFiittzzGGeerraalldd,, UUnniilleevveerr cchhaaiirrmmaann,, ssaaiidd,, ""WWee aarree vveerryy eexxcciitteedd aabboouutt tthhee ccoommbbiinnaattiioonn ooff UUnniilleevveerr aanndd BBeesstt--ffooooddss.. TThhiiss ttrraannssaaccttiioonn ccrreeaatteess tthhee pprree--eemmiinneenntt gglloobbaall ffoooodd aanndd CCoonnssuummeerr GGooooddss CCoommppaannyy.. TTooggeetthheerr wwee wwiillll hhaavvee aa ppoorrttffoolliioo ooff ppoowweerrffuull wwoorrllddwwiiddee aanndd rreeggiioonnaall bbrraannddss,, wwiitthh ssttrroonngg ggrroowwtthh pprroossppeeccttss..""

VVIISSIIOONN SSTTAATTEEMMEENNTT::

UUnniilleevveerr ssaaiidd tthhee BBeesstt FFooooddss mmaannaaggeemmeenntt tteeaamm wwoouulldd ppllaayy aann ""iimmppoorrttaanntt rroollee"" iinn tthhee ccoommbbiinneedd ccoommppaannyy bbuutt ggaavvee nnoo ssppeecciiffiiccss..

""IInn aaddddiittiioonn ttoo ccrreeaattiinngg aa pprreemmiieerr ppoorrttffoolliioo ooff ffooooddss bbrraannddss,, tthhee ccoommbbiinnaattiioonn wwiillll bbrriinngg ttooggeetthheerr ttwwoo ooff tthhee wwoorrlldd''ss ttoopp mmaannaaggeemmeenntt tteeaammss,, ccrreeaattiinngg oonnee

wwhhiicchh iiss ccaappaabbllee ooff rreeaalliizziinngg tthhee ggrroowwtthh aanndd ssyynneerrggyy ooppppoorrttuunniittyy aanndd lleeaaddiinngg tthhee ccaatteeggoorryy aaggeennddaa,,"" FFiittzzGGeerraalldd ssaaiidd..

AAllrreeaaddyy rraannkkeedd NNoo.. 33 aammoonngg wwoorrlldd ffoooodd ccoommppaanniieess,, UUnniilleevveerr wwiillll nnooww jjuummpp aahheeaadd ooff PPhhiilliipp MMoorrrriiss KKrraafftt FFooooddss aanndd cchhaalllleennggee NNeessttllee AAGG ffoorr tthhee ttoopp ssppoott.. UUnniilleevveerr''ss ssttaabbllee ooff bbrraannddss iinncclluuddeess LLiippttoonn tteeaass,, CClloossee UUpp ttooootthhppaassttee aanndd CCaallvviinn KKlleeiinn ffrraaggrraanncceess..

TThhee ttrraannssaaccttiioonn iiss eexxppeecctteedd ttoo bbee ccoommpplleetteedd iinn tthhee ffoouurrtthh qquuaarrtteerr ooff ffiissccaall 22000000.. IItt wwaass aallssoo rreeppoorrtteedd iinn JJuunnee tthhaatt BBeesstt FFooooddss wwaass aasssseessssiinngg aa ppootteennttiiaall aaccqquuiissiittiioonn ooff CCaammppbbeellll SSoouupp CCoommppaannyy..

PPllaanntt CCaappaacciittyy aanndd UUttiilliizzaattiioonn

TThhee ccoommppaannyy''ss oouuttppuutt iinn EEnneerrggiillee//GGlluuccoossee//GGllaaxxoossee DD ddiivviissiioonn wwaass 55,,111199 mmeettrriicc ttoonnss aass ccoommppaarreedd ttoo llaasstt yyeeaarr''ss pprroodduuccttiioonn ooff 22,,552299 TToonnss.. IInn tthhee ootthheerr pprroodduuccttss ddiivviissiioonn,, tthhee ccoommppaannyy pprroodduucceedd 44,,004488 mmeettrriicc ttoonnss aass aaggaaiinnsstt 33,,779933 mmeettrriicc ttoonnss llaasstt yyeeaarr.. TThhee iinnssttaalllleedd ccaappaacciittyy ooff tthhee ppllaanntt ppeerr88 hhoouurr sshhiifftt ssttaannddss aatt 1155 mmeettrriicc ttoonn..

OORRGGAANNIIZZAATTIIOONNAALL SSTTRRUUCCTTUURREE RRaaffhhaann BBeesstt FFooooddss LLiimmiitteedd iiss aa mmuullttiinnaattiioonnaall ccoommppaannyy hheeaaddeedd bbyy 1111 BBooaarrddss ooff DDiirreeccttoorrss.. TThhee BBooaarrdd ooff DDiirreeccttoorrss hhaass aappppooiinntteedd aa ffuullll ttiimmee ggeenneerraall mmaannaaggeerr ooff aallll tthhee ddeeppaarrttmmeennttss ooff tthhee oorrggaanniizzaattiioonn..

DDEEPPAARRTTMMEENNTTSS OOFF OORRGGAANNIIZZAATTIIOONN

FFoolllloowwiinnggss aarree tthhee ddeeppaarrttmmeennttss wwoorrkkiinngg iinn tthhee oorrggaanniizzaattiioonn..

PPrroodduuccttiioonn DDeeppaarrttmmeenntt

HHuummaann RReessoouurrccee DDeeppaarrttmmeenntt

SSaalleess DDeeppaarrttmmeenntt

RR && DD ((RReesseeaarrcchh && DDeevveellooppmmeenntt)) DDeeppaarrttmmeenntt

SSuuppppllyy CChhaaiinn

MMaarrkkeettiinngg DDeeppaarrttmmeenntt

SSIISS ((SSaalleess IInnffoorrmmaattiioonn SSyysstteemm)) DDeeppaarrttmmeenntt

FFoooodd SSoolluuttiioonn//CCaatteerr PPllaann DDeeppaarrttmmeenntt

AAllll tthhee GGeenneerraall MMaannaaggeerrss ooff tthheessee ddeeppaarrttmmeennttss aarree aannsswweerraabbllee ttoo tthhee bbooaarrdd ooff ddiirreeccttoorrss..

PPRROODDUUCCTT PPOORRTTFFOOLLIIOO

RRBBLL''ss ddiivveerrssiiffiieedd ppoorrttffoolliioo iinncclluuddeess ffuullll pprroodduucctt lliinneess ooff KKnnoorrrr,, ddeesssseerrttss,, ddeexxttrroossee aanndd ddrreessssiinnggss.. DDuurriinngg tthhee yyeeaarr uunnddeerr rreevviieeww,, tthhee ccoommppaannyy ccoonnttiinnuueedd iittss ggrroowwtthh mmoommeennttuumm iinn tthhee KKnnoorrrr rraannggee.. TThhrreeee nneeww vvaarriiaannttss iinn ''YYaakkhhnnii'' aanndd ttwwoo ssppiiccyy vvaarriiaannttss iinn nnooooddlleess wweerree iinnttrroodduucceedd ttoo eexxppaanndd ccuussttoommeerr bbaassee.. AAddddiittiioonnaallllyy,, bbyy iinnttrroodduucciinngg tthhee ""CChhiillii--GGaarrlliicc SSaauuccee"",, ccoommppaannyy eexxppaannddeedd iittss ssaauuccee rraannggee.. AA mmaajjoorr ppoorrttiioonn ooff tthhee ddeesssseerrtt bbuussiinneessss wwaass lloosstt oowwiinngg ttoo ggoovveerrnnmmeenntt rreessttrriiccttiioonnss oonn mmaarrrriiaaggee ppaarrttiieess.. HHoowweevveerr,, tthhiiss ddeecclliinniinngg eeffffeecctt wwaass rreevveerrsseedd bbyy iinnttrroodduuccttiioonn ooff tthhee nneeww pprroodduuccttss,, ffllaavvoorrss aanndd ssmmaalllleerr ppaacckk ssiizzeess.. TToo iinnccrreeaassee pprroodduucctt ppeenneettrraattiioonn,, RRaaffhhaann CCuussttaarrdd wwaass iinnttrroodduucceedd iinn ssaacchheett ppaacckkss.. VVaarriiaannttss wweerree llaauunncchheedd iinn ppuuddddiinngg aanndd ccuussttaarrdd rraannggee ttoo ccaatteerr ggrroowwiinngg ppooppuullaarriittyy ooff cchhooccoollaattee aanndd ssttrraawwbbeerrrryy ffllaavvoorrss.. AAmmoonngg ddrreessssiinnggss,, nneeww ffllaavvoorrss ooff cchhiicckkeenn,, vveeggeettaabbllee aanndd cchhiillii ggaarrlliicc ssaannddwwiicchh sspprreeaaddss wweerree iinnttrroodduucceedd..

CCAATTEERR PPLLAANN

CCaatteerr ppllaann wwaass llaauunncchheedd iinn bbyy RRaaffhhaann iinn 11999933 iinn PPaakkiissttaann wwhhiicchh iiss eennttiirreellyy ffoorr iinnssttiittuuttiioonnss iinn ccoommmmeerrcciiaall aanndd ssoocciiaall sseeccttoorr.. CCaatteerr ppllaann ooffffeerrss aa ssppeecciiaall rraannggee ooff pprroodduuccttss iinncclluuddiinngg mmaayyoonnnnaaiissee,, ttoommaattoo kkeettcchhuupp,, ssaallaadd ddrreessssiinnggss,, ssoouuppss,, ccooookkiinngg aaiiddss,, ooiillss aanndd ddeesssseerrttss.. TThhee mmaaiinn rreeaassoonn bbeehhiinndd tthhee hheeaalltthhyy ggrroowwtthh ooff CCaatteerr ppllaann dduurriinngg tthhiiss yyeeaarr wwaass tthhee iinnccrreeaassee iinn ""eeaattiinngg oouutt"" ttrreenndd iinn tthhee ccoouunnttrryy aanndd tthhee eemmeerrggeennccee ooff iinntteerrnnaattiioonnaall ffaasstt ffoooodd cchhaaiinnss lliikkee PPiizzzzaa HHuutt,, MMccDDoonnaallddss,, TTGGIIFF,, SSuubbwwaayy,, KKFFCC aanndd DDuunnkkiinn DDoonnuuttss eettcc..

IIMMPPOORRTTAANNCCEE OOFF MMAARRKKEETTIINNGG DDEEPPAARRTTMMEENNTT

BBeesstt FFooooddss aass ccoommppaarreedd ttoo ootthheerr MMuullttiinnaattiioonnaall CCoommppaanniieess iiss aa ssmmaalllleerr oonnee.. TThheeiirr mmaaiinn ffooccuuss iiss ttoowwaarrdd ggrroowwtthh oorriieennttaattiioonn ooff NNoovveell PPrroodduuccttss.. MMaarrkkeettiinngg ppllaayyss aann iimmppoorrttaanntt rroollee iinn tthhee pprroossppeerriittyy ooff tthhee oorrggaanniizzaattiioonn.. BBuutt uunnffoorrttuunnaatteellyy ffoorr tthhee llaasstt ttwwoo ttoo tthhrreeee yyeeaarrss,, mmaarrkkeettiinngg ddeeppaarrttmmeenntt ddiidd nnoott ppllaayy aannyy mmaajjoorr ppaarrtt iinn BBeesstt FFooooddss.. FFrroomm tthhiiss yyeeaarr mmaannaaggeemmeenntt iiss ffooccuussiinngg mmoorree oonn tthhee mmaarrkkeettiinngg aaccttiivviittiieess,, wwhhiicchh iinnccrreeaassee tthhee eexxiisstteennccee ooff mmaarrkkeettiinngg ddeeppaarrttmmeenntt iinn tthhee oorrggaanniizzaattiioonn..

MMAARRKKEETTIINNGG RREESSEEAARRCCHH

CCoommppaannyy iittsseellff iiss nnoott eennggaaggeedd iinn tthhee mmaarrkkeettiinngg rreesseeaarrcchh.. FFoorr mmaarrkkeettiinngg rreesseeaarrcchh tthhee ccoommppaannyy hhiirreedd tthhee sseerrvviicceess ooff ddiiffffeerreenntt aaggeenncciieess aanndd tthheeyy ddoo tthhee rreesseeaarrcchh wwoorrkk ffoorr tthhee ccoommppaannyy.. TThheeyy uusseedd FFooccuusseedd--bbaasseedd RReesseeaarrcchh GGrroouupp mmeetthhoodd ffoorr mmaarrkkeettiinngg rreesseeaarrcchh.. IInn tthhiiss mmeetthhoodd tthhee aaggeennccyy’’ss eemmppllooyyeeeess aarree rreeqquuiirreedd ttoo ggoo ttoo eeaacchh aanndd eevveerryy hhoouussee ooff tthheeiirr ttaarrggeett aarreeaa aanndd eexxaammiinnee tthhee uussaaggee oorr tthhee rreeqquuiirreemmeenntt ooff tthheeiirr ccuussttoommeerr aanndd rreeppoorrtteedd ttoo tthhee ccoommppaannyy.. TThhee ccoommppaannyy tthheenn mmaakkeess tthheeiirr ssttrraatteeggyy aaccccoorrddiinngg ttoo tthhee ddaattaa pprroovviiddeedd bbyy tthhaatt aaggeennccyy..

TTAARRGGEETT MMAARRKKEETT

TTaarrggeett mmaarrkkeett ddeeffiinneedd bbyy tthhee ccoommppaannyy iiss bbaasseedd oonn iinnccoommee lleevveell,, aaggee aanndd bbeehhaavviioorr ooff tthhee ppeeooppllee.. TThhee ttaarrggeett mmaarrkkeett iiss ddiiffffeerreenntt ffoorr ddiiffffeerreenntt pprroodduuccttss.. FFoorr eexxaammppllee,, ffoorr ccoorrnn--ooiill tthhee ttaarrggeett mmaarrkkeett iiss uuppppeerr aanndd mmiiddddllee ccllaassss.. TThhee ttaarrggeett mmaarrkkeett ffoorr tthhee KKnnoorrrr ccuubbeess iiss lloowweerr ccllaassss..

PPRROODDUUCCTTSS OOFFFFEERREEDD BBYY RRBBFFLL

TThheerree aarree ssiixx mmaajjoorr pprroodduuccttss ooffffeerreedd bbyy BBeesstt FFooooddss.. TThheessee aarree::

11.. RRaaffhhaann

22.. KKnnoorrrr

33.. EEnneerrggiillee

44.. GGllaaxxoo--DD

55.. AAggrroo ((LLaauunnddrryy SSttaarrcchh))

66.. SShhaahhii ((LLaauunnddrryy SSooaapp))

11.. RRAAFFHHAANN

TThhee pprroodduuccttss uunnddeerr tthhiiss bbrraanndd nnaammee aarree::

RRaaffhhaann CCoorrnn OOiill

RRaaffhhaann CCaannnnoollaa OOiill

RRaaffhhaann CCaarrnnoollaa OOiill

RRaaffhhaann CCuussttaarrdd

RRaaffhhaann JJeellllyy

RRaaffhhaann PPuuddddiinngg

RRaaffhhaann IIccee ccrreeaamm

RRaaffhhaann pprroodduuccttss aarree oonnee ooff tthhee mmaajjoorr ccoonnssuummeerr pprroodduuccttss ooffffeerreedd bbyy BBeesstt FFooooddss iinn tthhee mmaarrkkeett.. TThheeyy aarree tthhee oonnllyy pprroodduucceerr aass wweellll aass tthhee mmaarrkkeett lleeaaddeerr ooff tthheessee pprroodduuccttss.. TThhee ccoommppaanniieess ssuucchh aass KKiinnzzaa,, wwhhiicchh pprroodduucceess KKeettcchhuuppss,, FFaauujjii,, wwhhiicchh pprroodduucceess ccuussttaarrdd aanndd jjeelllliieess,, aarree nnoott ccoonnssiiddeerreedd aass tthheeiirr ccoommppeettiittoorrss dduuee ttoo tthheeiirr llooww mmaarrkkeett sshhaarreess.. TThheessee pprroodduuccttss aarree bbaassiiccaallllyy ffoorr uuppppeerr ccllaassss..

22.. KKNNOORRRR

TThhee pprroodduuccttss uunnddeerr tthhiiss bbrraanndd nnaammee aarree::

KKnnoorrrr CChhiicckkeenn CCuubbeess

KKnnoorrrr PPuullaaoo CCuubbeess

KKnnoorrrr NNooooddlleess

KKnnoorrrr SSoouuppss

KKnnoorrrr KKeettcchhuupp

KKnnoorrrr SSpprreeaaddss

BBeesstt FFooooddss aarree tthhee oonnllyy pprroodduucceerrss ooff KKnnoorrrr pprroodduuccttss iinn tthhee mmaarrkkeett.. TThheerree iiss nnoo ccoommppeettiittoorr ooff tthhee BBeesstt FFooooddss iinn tthhee KKnnoorrrr pprroodduuccttss.. TThheessee pprroodduuccttss aarree bbaassiiccaallllyy ffoorr tthhee mmiiddddllee ccllaassss..

33.. EENNEERRGGIILLEE

TThhee pprroodduuccttss uunnddeerr tthhiiss bbrraanndd nnaammee aarree::

EEnneerrggiillee

RRaassbbhhaarree

SSppoorrttyy

RRoooohh--ee--SSuummmmeerr

EEnneerrggiillee iiss oonnee ooff tthhee mmaajjoorr bbrraannddss ooff BBeesstt FFooooddss.. TThheessee aarree bbaassiiccaallllyy ffoorr tthhee ssppoorrttssmmaann.. TTaanngg iiss tthhee oonnllyy ccoommppeettiittoorrss ooff tthhiiss bbrraanndd bbuutt dduuee tthhee llooww mmaarrkkeett sshhaarree tthheeyy aarree nnoott ccoonnssiiddeerr aass aa mmaajjoorr ccoommppeettiittoorr..

44.. GGLLAAXXOOSSEE--DD

TThhee pprroodduuccttss uunnddeerr tthhiiss bbrraanndd nnaammee aarree::

GGllaaxxoossee--DD

GGllaaxxoossee--DD MMuullttii vviittaammiinn

GGlluuccoossee

BBeesstt FFooooddss ppuurrcchhaassee tthhiiss bbrraanndd ffrroomm GGllaaxxoo--WWeellllccoommee CCoommppaannyy.. TThheessee aarree mmaaiinnllyy ffoorr ppaattiieennttss wwhhoo uussee gglluuccoossee ffoorr rreeccoovveerriinngg tthheeiirr eenneerrggyy aafftteerr ddooiinngg ssoommee hhaarrdd wwoorrkk.. TThheerree iiss nnoo ccoommppeettiittoorr ooff tthhiiss bbrraanndd iinn tthhee mmaarrkkeett..

55.. AAGGRROO && SSHHAAHHII

TThhee ccoommppaannyy hhaass ttwwoo ssmmaallll bbrraannddss aass wweellll.. TThheeyy aarree AAggrroo && SShhaahhii.. TThheessee aarree uusseedd ffoorr llaauunnddrryy ppuurrppoossee.. TThheessee pprroodduuccttss aarree nnoott vveerryy mmuucchh rreennoowwnneedd dduuee ttoo lleessss oorr nnoo pprroommoottiioonn ooff tthheessee pprroodduuccttss.. TThheessee pprroodduuccttss aarree bbaassiiccaallllyy ffoorr mmiiddddllee && lloowweerr ccllaassss..

PPRRIICCIINNGG SSTTRRAATTEEGGYY

TThhee pprriicciinngg ooff tthhee pprroodduucctt iiss mmaaddee oonn tthhee bbaassiiss ooff GG..PP MMaarrggiinn,, ccoommppaarraattiivvee mmaarrkkeett pprriicceess aanndd mmaarrkkeett sshhaarreess aatt ddiiffffeerreenntt pprriiccee lleevveellss

PPLLAACCEEMMEENNTT

WWhhiillee ppllaacciinngg tthheeiirr pprroodduuccttss tthhee ccoommppaannyy’’ss mmaaiinn ffooccuuss iiss oonn rreettaaiill nnoott oonn wwhhoollee ssaallee.. TThhee 7700%% ddiissttrriibbuuttiioonn ooff EEnneerrggiillee aanndd GGllaaxxoossee--DD iiss oonn wwhhoollee ssaallee wwhhiillee 3300%% iiss oonn rreettaaiill.. FFoorr ggeettttiinngg mmoorree ssuucccceessss iitt iiss nneecceessssaarryy ttoo ddiissttrriibbuuttee 8800%% oonn wwhhoollee ssaallee aanndd 2200%% oonn rreettaaiill.. BBuutt tthhee ssiittuuaattiioonn iinn iinnvveerrssee iinn tthhee ccoommppaannyy’’ss pprroossppeeccttiivvee..

PPRROOMMOOTTIIOONN

TThheerree aarree ttwwoo mmeetthhooddss ffrroomm wwhhiicchh aa ccoommppaannyy ccaann pprroommoottee iittss pprroodduuccttss.. TThheessee aarree::

AATTLL ((AAbboovvee tthhee LLiinnee))

BBTTLL ((BBeellooww tthhee LLiinnee))

AATTLL iinncclluuddeess pprroommoottiioonn tthhrroouugghh mmeeddiiaa.. MMeeddiiaa ccaann bbee ooff aannyy kkiinndd ii..ee.. TT..VV.. RRaaddiioo,, NNeewwss ppaappeerrss eettcc.. BBTTLL iinncclluuddeess pprroommoottiioonn tthhrroouugghh ssaalleess lleevveell aaccttiivviittiieess.. TThheeyy eemmpphhaassiiss mmaaiinnllyy oonn BBTTLL pprroommoottiioonn ffrroomm tthhee ppaasstt ffeeww yyeeaarrss.. BBuutt ffrroomm tthhee rreecceenntt yyeeaarr tthheeyy aarree mmoorree ccoonncceerrnneedd wwiitthh AATTLL pprroommoottiioonn.. RRBBLL eennhhaanncceedd mmaarrkkeettiinngg iinnvveessttmmeenntt ttoo ffuurrtthheerr ssttrreennggtthheenn iittss bbrraannddss aanndd iinnccrreeaassee ccoonnssuummeerr ppuullll ffoorr pprroodduuccttss.. TThhee ffooccuuss wwaass ccoonnttiinnuueedd oonn tthhee rreecciippee oorriieenntteedd eedduuccaattiioonnaall ccooookkiinngg pprrooggrraamm ""KKnnoorrrr kkaayy zzaaiiqqaayy"" wwhhiicchh hheellppeedd tthhee ccoommppaannyy ttoo eedduuccaattee tthhee ccoonnssuummeerrss oonn mmuullttiippllee pprroodduucctt uussaaggee.. TThhee eeffffeeccttiivvee ccoonnssuummeerr pprroommoottiioonnss aallssoo hheellppeedd ttoo aacchhiieevvee ddoouubbllee--ddiiggiitt vvoolluummee ggrroowwtthh iinn ddeesssseerrtt

bbuussiinneessss dduurriinngg tthhee yyeeaarr uunnddeerr rreevviieeww.. AAnn eeffffeeccttiivvee ""vviillllaaggee mmaarrkkeettiinngg"" pprrooggrraamm wwaass iinniittiiaatteedd ttoo ggeenneerraattee hheeaalltthhyy ssaalleess ooff ddeexxttrroossee.. TTrraaddee ddiissccoouunnttss aarree aallssoo ooffffeerreedd iinn tthhee nneeaarrbbyy ffuuttuurree oonn mmaannyy ooff tthheeiirr pprroodduuccttss ttoo aattttrraacctt tthhee ccuussttoommeerrss.. FFuurrtthheerr eemmpphhaassiizzee iiss oonn ppuullll nnoott oonn ppuusshh..

PPRROODDUUCCTT LLAAUUNNCCHHIINNGG

TThhee ccoommppaannyy iiss nnoott eemmpphhaassiizziinngg oonn pprrooppeerr llaauunncchhiinngg ooff pprroodduucctt.. TThheeiirr ssttrraatteeggyy iiss jjuusstt ttoo tthhrrooww tthhee pprroodduucctt iinn tthhee mmaarrkkeett aanndd iitt wwiillll bbee ssoolldd oonn iittss oowwnn.. TThhiiss ccaauussee ffaaiilluurree ooff tthhee pprroodduucctt..

FFoorr eexxaammppllee,, RRoooohh--ee--SSuummmmeerr iiss tthhee pprroodduucctt ooff ssuummmmeerr sseeaassoonn aanndd iitt sshhoouulldd bbee llaauunncchheedd iinn MMaarrcchh--AApprriill ffoorr bbeetttteerr rreessuullttss.. BBuutt tthhee ccoommppaannyy llaauunncchheess tthhaatt pprroodduucctt iinn tthhee rraaiinnyy sseeaassoonn iinn wwhhiicchh ppeeooppllee ddoo nnoott lliikkee oorr tthheeyy ddoo nnoott ggoo ffoorr LLaall SShhaarrbbaatt..

SSiimmiillaarrllyy,, SSppoorrttyy iiss aa ddrriinnkk wwhhiicchh iiss gglluuccoossee bbaasseedd aanndd ssuuggaarr ffrreeee.. IItt iiss eessppeecciiaallllyy ffoorr tthhee ssppoorrttssmmaann aanndd iitt bbee llaauunncchheedd wwhheenn tthheerree iiss mmoorree ssppoorrttss aaccttiivviittiieess.. BBuutt tthhee ccoommppaannyy llaauunncchheedd tthhaatt pprroodduucctt iinn tthhee mmoonntthh ooff RRaammaaddaann wwhheenn tthheerree iiss uusseedd ttoo lleessss ssppoottss aaccttiivviittiieess.. IInn ssuucchh kkiinndd ooff ccoommppeettiittiivvee nnoo ccoommppaannyy uussee ttoo ggoo ffoorr llaauunncchhiinngg tthheeiirr tthhrreeee pprroodduuccttss aatt tthhee ssaammee ttiimmee.. BBuutt tthheeyy llaauunncchheedd tthheerree tthhrreeee pprroodduuccttss,, RRaassbbhhaarree,, SShhaahhii aanndd AAggrroo aatt tthhee ssaammee ttiimmee.. TThhiiss ccaauussee tthhee ffaaiilluurree iiff tthhee pprroodduucctt bbeeccaauussee tthhee ccoommppaannyy ccaann nnoott pprrooppeerrllyy ccoonncceennttrraattee oonn oonnee ppaarrttiiccuullaarr pprroodduucctt.. NNooww tthhee ccoommppaannyy hhaass cchhaannggeedd iittss ssttrraatteeggyy.. AAllll tthheessee pprroodduuccttss aarree rreellaauunncchheedd wwiitthh aa pprrooppeerr ppllaann iinn tthhee ccoommiinngg ffuuttuurree..

SSWWOOTT AANNAALLYYSSIISS SSTTRREENNGGTTHH

11.. IINNNNOOVVAATTIIVVEE::

TThhee ssttrroonngg ppooiinntt ooff tthhee ccoommppaannyy iiss tthheeyy hhaavvee mmaannyy iinnnnoovvaattiivvee iiddeeaass wwhhiicchh mmaakkee tthheemm tthhee mmaarrkkeett lleeaaddeerr ooff tthhee ffoooodd iinndduussttrryy.. TThhiiss iiss tthhee mmaaiinn ssttrreennggtthh ooff tthhee ccoommppaannyy tthhaatt tthheeyy aallwwaayyss pprreesseenntteedd tthhee tthhiinnggss wwiitthh nneeww iiddeeaass..

22.. EENNTTEERRPPRREENNEEUURRAALL CCUULLTTUURREE::

TThhee ccoommppaannyy hhaass eenntteerrpprreenneeuurraall ccuullttuurree.. IItt hheellppss tthhee ccoommppaannyy ttoo ttaakkee tthhee ddeecciissiioonn oonn tthhee ssppoott.. LLeessss ttiimmee iiss uusseedd ffoorr tthhee iinnnnoovvaattiioonn ooff pprroodduuccttss..

33.. FFLLEEXXIIBBIILLIITTYY::

TThhee ccoommppaannyy hhaass vveerryy mmuucchh fflleexxiibbiilliittyy.. IItt hhaass tthhee tteennddeennccyy ttoo aaddoopptt tthhee cchhaannggeess qquuiicckkllyy.. SSoo tthhee ccoommppaannyy mmoollddss aaccccoorrddiinngg ttoo tthhee cciirrccuummssttaanncceess..

44.. NNOO CCOOMMPPEETTIITTIIOONN::

TThhee ccoommppaannyy hhaass nnoo ccoommppeettiittiioonn iinn ssoommee ooff iittss pprroodduuccttss.. FFoorr eexxaammppllee,, iinn GGllaaxxoossee--DD,, CCuussttaarrdd,, JJeellllyy,, PPuuddddiinngg,, CCoorrnn ooiill aanndd CCuubbeess.. TThhee ccoommppaannyy eeaarrnnss mmuucchh mmoorree ffrroomm tthheessee pprroodduuccttss..

WWEEAAKKNNEESSSSEESS

11.. PPRROOMMOOTTIIOONN::

TThhee ccoommppaannyy hhaass nnoott pprrooppeerrllyy eemmpphhaassiizzeedd oonn tthhee pprroommoottiioonnaall aaccttiivviittiieess.. AATTLL aaccttiivviittiieess aarree vveerryy llooww..

22.. NNOO EEQQUUAALL EEMMPPHHAASSIISS::

TThhee ccoommppaannyy hhaass nnoott eeqquuaall eemmpphhaassiiss oonn aallll tthhee pprroodduuccttss.. SSeevveennttyy ttoo eeiigghhttyy ppeerrcceenntt ooff tthhee ccoommppaannyy rreevveennuuee ddeeppeennddss oonn tthhrreeee pprroodduuccttss.. TThheessee tthhrreeee

pprroodduuccttss aarree EEnneerrggiillee,, GGllaaxxoossee--DD aanndd RRaaffhhaann ccoorrnn ooiill.. TThhee ccoommppaannyy ccaann ggeenneerraattee mmoorree pprrooffiitt iiff iitt eemmpphhaassiizzeess mmoorree oonn ootthheerr pprroodduuccttss..

33.. SSAALLEESS OORRIIEENNTTEEDD::

TThhee ccoommppaannyy iiss mmoorree ssaalleess oorriieenntteedd.. BBuutt tthhiiss eerraa iiss nnoott ffiitt ffoorr ssaalleess oorriieenntteedd.. AAllll tthhee ccoommppaanniieess ggoo ffoorr mmaarrkkeettiinngg aaccttiivviittiieess bbuutt tthheeyy aarree eemmpphhaassiizzeedd mmoorree oonn ssaalleess oorriieenntteedd..

44.. WWEEAAKK IINN CCOOMMPPEETTIITTIIOONN::

TThhee ccoommppaannyy iiss vveerryy wweeaakk iinn ccoommppeettiittiioonn.. TThhee ccoommppaannyy iiss ppeerrffoorrmmiinngg vveerryy wweellll iinn tthhee aarreeaass ooff mmoonnooppoollyy,, bbuutt wwhheerree tthheerree iiss ccoommppeettiittiioonn ccoommppaannyy iiss nnoott uupp ttoo tthhee mmaarrkk..

OOPPPPEERRTTUUNNIITTIIEESS

11.. GGRROOWWTTHH::

TTwweennttyy ppeerrcceenntt ooff ccoommppaannyy’’ss ggooooddss hhaavvee tthhee ooppppoorrttuunniittiieess iinn ggrroowwtthh.. TThheerree iiss nnoott mmuucchh ggrroowwtthh iinn tthheessee ttwweennttyy ppeerrcceenntt pprroodduuccttss.. TThhee ccoommppaannyy ccaann eeaarrnn mmoorree iiff tthhee ggrroowwtthh ooff tthheessee ttwweennttyy ppeerrcceenntt iiss iinnccrreeaasseedd..

22.. LLEEVVEERR BBRROOTTHHEERR’’SS PPRRAACCTTIICCEESS::

LLeevveerr BBrrootthheerrss iiss aa vveerryy llaarrggee ccoonnssuummeerr ggooooddss pprroodduucciinngg ccoommppaannyy.. IIttss bbeesstt pprraaccttiicceess mmuusstt bbee uusseedd ttoo ttaakkee tthhee aaddvvaannttaaggee aanndd ttoo hhaavvee ccoommppeettiittiivvee eeddggee oonn tthhee ccoommppaannyy’’ss ccoommppeettiittoorrss..

TTHHRREEAATTSS

11.. CCOOMMPPEETTIITTIIOONN::

TThhee ccoommppaannyy’’ss bbiiggggeesstt tthhrreeaatt iiss tthhee ccoommppeettiittoorrss iinn ssoommee ooff iittss pprroodduucctt.. TThhee ccoommppaannyy eemmpphhaassiizzeess mmoorree oonn tthhoossee pprroodduuccttss iinn wwhhiicchh tthheeyy aarree tthhee mmaarrkkeett

lleeaaddeerrss bbuutt tthheeyy aarree nnoott eemmpphhaassiizziinngg mmoorree oonn tthhoossee pprroodduuccttss iinn wwhhiicchh tthheeyy aarree ffaacciinngg aa ssttrroonngg ccoommppeettiittiioonn..

22.. CCUUTT RRAATTEESS::

CCoommppaannyy iiss aa tthhrreeaatt ffoorr iittsseellff.. IItt ccaann nnoott pprrooppeerrllyy pprroommoottee aanndd ppllaaccee iittss pprroodduuccttss iinn tthhee mmaarrkkeett.. TThheeyy aarree jjuusstt tthhrroowwiinngg tthheeiirr pprroodduuccttss wwhhiicchh ccaauussee aabbuunnddaannccee ooff tthhee pprroodduucctt aanndd uullttiimmaatteellyy tthhee pprriicceess ooff tthhee pprroodduucctt ggoo ddoowwnn dduuee ttoo eexxcceessss ooff ssuuppppllyy.. TThhiiss ccaauussee tthhee ccoommppaannyy ttoo ccuutt bbaacckk iittss pprriicceess wwhhiicchh iiss nnoott aacccceeppttaabbllee bbyy ddiissttrriibbuuttoorrss..

FFIINNAANNCCIIAALL CCOONNDDIITTIIOONN:: OVERVIEW (December 24 2009): Unilever Pakistan Foods Limited, formerly known as Rafhan Best Foods Limited (RBL) has been one of the leading producers of consumer food products in the country. The spectrum of RBL s product range contains some of the leading brands like Rafhan, Knorr, Energile, Glaxose-D, Bestfoods etc. The majority of RBL s shares are held by Bestfoods, USA, which is engaged in producing a vast range of food products in 63 countries across 5 continents. RBL was incorporated in Pakistan 1997 and is listed on Karachi and Lahore stock exchanges in Food and Allied sector. On 24th April, 2007 Rafan Best Foods Limited was renamed Unilever Pakistan Foods Limited, after Unilever s acquisition of Bestfoods. In Pakistan, Unilever made its debut in 1948 and now, it is one of the most prominent multinationals in the country operating by two affiliated companies, viz. Unilever Pakistan and Unilever Pakistan Foods. The two public listed limited companies have 5 wholly-owned and 7 third party manufacturing sites across Pakistan with 1,500 employees on their payroll and many thousands indirectly. Currently, Unilever Foods Pakistan has 5 major brands: Knorr, Rafhan, Energile, Glaxose-D and Unilever Food Solutions. RECENT RESULTS 1H09 The company delivered a sales growth of 7.4% during the period under review on account of aggressive price growth. Despite this, Sharp increase in raw material prices has led to a 3% decline in gross margins over last year. There was a 33%

increase in advertising expense due to heavy investment in launching new categories. Net sales were recorded at Rs 1808 million. PAT was recorded at Rs 124 million, a decline of 39.2% due to the above mentioned reasons. EPS was recorded at Rs 20.2 as compared to Rs 33.14 in the same period last year. Economic slowdown has also hurt the demand for Unilever Pakistan Foods products and the coming times pose more difficulty for the organization. FINANCIAL PERFORMANCE (DEC 03-DEC 08) The company sales continue to grow consecutively for the 5th year, registering a growth of 29.5% in FY08, compared to 22.53% in FY07 as the company continues to built on the growth momentum starting in 2004 after the loss occurred in 2003. Since 2004 the company grew at a rate of 24.97% CAGR. Good marketing strategies and the company s bold venture into new products like Knorr meal maker, Rafhan Magic Jelly and Energile ready to drink yielded positive results. Furthermore, two new variants of Knorr noodles were introduced and the Energile range was re launched; both ventures proved successful and significant value was generated. The export business, aimed at traditional taste and halal markets mainly in Asia and Europe region registered inspirational growth, with revenues from exports for the FY08 increased more than twice from those in FY07. Significant investment in Pakistani factory to overcome capacity constraints has also been made. The impressive growth in sales was however mitigated by rising COGS, on the back of the peaking food inflation, energy crisis and other situational externalities in the country coupled with competitive pricing, thereby maintaining pressure on the gross margins. The COGS for FY08 showed almost a proportionate increase of 29% from the FY07. Operating Profit growth was around 56% compared to FY07. Gross Profit Margin showed more of a steady stage since FY05. The company showed a loss in 2003 but was able to recover till recent times with a CAGR of 89.75%. The profit margin growth was 11.31% in FY08 (2007: 37.38%). ROA showed an incline as the growth in profits (56% in FY 08) was much higher than the growth in assets. In FY08 equity shows a recovery from the big drop in FY07 as the company had dividends of Rs 75 and Rs 25 per share, causing a big drop in reserves, and spiking the FY07 s ROE. The liquidity ratios of the company had shown a decline since FY05, due to massive amount of short-term borrowings taken by the company in 2006 and 2007.

In FY08 the liquidity ratios project a stable pattern, showing no significant change. The finance cost showed a sharp rise in FY08 of 227% changed during the year (2007 growth rate being 56%). These short term borrowings are causing the company s current liabilities to surge and the laggard growth in current assets have caused a decline in Company s ability to pay off its short-term obligations, as shown in the accounts of 2007. The quick ratio, a better measure of liquidity showed a steady trend from FY03 to FY06 and then plunged downward, depicting that like the Current Assets, Quick Assets growth also lagged behind that of current liabilities. Inventory Turnover (ITO) ratio depicts how quickly the company is able to sell off its inventory. Unilever s inventory turnover was slightly lowered in 2005 but since then has been on the rise. This shows that Unilever s efficiency in turning its inventory to sales is on the decline, but still it is in reasonable trend. The prime reason is due to the growth in sales being more than the growth in inventories (which actually showed a decline in FY08) Day s sales outstanding (DSO) shows how quickly the company is able to collect the dues from its debtors. It should be enough for the company to avoid risks of bad debts. DSO for Unilever has been on the decline since 2003. It has shown a reduction from 36 days to 12 days in 2007 and in 2008, it further declined to 8 days. This shows that Unilever has a firm policy for debtors, but it should also be considered that the policy has not yet affected the sales of the company, which continue to grow. It is interesting to note that the Unilever food s inventories showed a decline of 6.77% in FY08. The operating cycle of the company is seen following a similar trend to that of the inventory turnover days, with the FY08 rate being 69 days as compared to 81 days in FY07. TATO of Unilever Foods have been on a steady inclining trend over the years, reflecting that the assets and sales are growing at a steady rate and the growth of sales is higher than the growth of assets. This trend continues in FY08. This shows that the company is responding well with the sales in terms of asset management. Sales/equity had declined during 2004 due to low sales but since then has been on a steady rise and managed accordingly in 2008, the sales/equity stood at 10.23. The decline in FY08 as compared to FY07 has been due to the sharp growth in equity of about 56%. Regarding debt management, both debt to equity and debt to assets ratios are following similar trend. From 2003 to 2005 they were showing a declining trend, whereas since 2005 to 2007, they were showing more of a rising trend. In FY08,

the D/E shows a decline mainly due to a sharp rise in equity and a comparatively modest rise in liabilities. The company managed to keep the liabilities down till 2005. However, thereafter the liabilities show a consecutive rise for 3 years until 2008 mainly on back of rising finance charges. The increase in liabilities in FY08 is caused by a growth of 202% in the non-current liabilities whereas the current liabilities show a decline of 8% from the previous year because of the finance cost incurred during the current year. Long-term debt/equity ratio had been almost near bottom at a very steady rate for the past few years, this year ie FY08, the Long term debt to Equity ratio stood higher (0.14) from previous year s low (of 0.07). Again, this can be attributed to the steep rise in non-current liabilities for FY08. The TIE ratio for Unilever Foods that showed a rising trend from 2003 with a spike in 2006, nose-dived in 2007 and continued to plunge in FY08, standing 24.85 this year. Looking at this, it can be inferred that Unilever Foods is being adversely affected due to higher markups and finance costs. The EPS of Unilever Foods has been on an upward march since 2003. After the loss faced by the company in 2003, it has not lowered its EPS yet and the FY08 s figure stands at Rs 56.60. Any change in EPS is caused by the profits earned by the company, as number of shares has been the same for the five years. The increase in FY08 was more than the previous years because of the increase in profits. The (P/E) ratio shows, how much investors are willing to pay per rupee of the reported profits, depends on the company s price per share and its earnings per share (EPS). The P/E for Unilever Foods have been on the downslide from 2004 to 2006 as the growth in EPS has been much higher than the share price. The yearend market prices have been on the increase over the five-year period, with 2007 showing major increases. In 2007 it was observed that the yearend market price of the company s share had been much higher than previous years (2006: Rs 414 to 2007: Rs 921), causing an increase in P/E multiple to 36.5x. In 2008, the P/E ratio again declined to stand at 29.31. This decline is mainly due to an increase of 25% in year-end price of the share whereas the earnings grew by 55%, the net effect being decrease due to the disproportionate nature of the growth. Since 2003 to 2006, the company s book value has been almost steady, declining slightly in 2004 and then rising till 2006. The changes in book value are caused by the changes in equity of the company, as number of shares outstanding is the same throughout. The nosedive in 2007 was caused by decrease in equity on the

back of decrease in reserves of the company. In 2008, the book value again showed signs of recovery and stood at 48.92 (FY07 Rs 32.31). The main reason for this is the FY08 growth in total equity of about 58.3% from FY07. The dividend payout has also shown a steady rising trend from 2004 to 2006 (dividend were not given in 2003 due to losses), followed by an extremely healthy dividend Payout of Rs 93/share in FY07, and in FY08, the Dividend Payout stood at Rs 36/share. The major beneficiary of which would be its associated companies and undertakings followed by the individual shareholders of the company. FUTURE OUTLOOK The global recession has set in with global decline in consumer spending and weak demand for consumer goods due to reduced buying power and inflation, which has plagued almost all major economies of the world. The full impact of the global downturn is slowly impacting Pakistan and consumers are now more discerning in making buying decisions and are spending more prudently. Despite a challenging environment, Unilever Foods have managed to remain profitable and maintain a positive outlook, which is an essential thing for any company under the current situation. The pressure on the company s margins is expected to continue and the company remains unfazed and committed to face competition and deliver better quality at cheaper prices. Another major concern to Unilever Foods is of increasing markup rates that it is currently facing for past two years as they are causing some troubles in managing. The company needs to effectively manage its short term borrowings at its earliest. Keeping in view, Unilever s strong competitive edge of continuous innovation, delivering cost advantages and deep local roots, the company has the potential to steer out of these troubled waters and outperform the competition.

Balance sheet 2003 2004 2005 2006 2007 2008

====================================================================================

In PK 000 s

=====================================================================================

Property, plant and equipment 152,516 117,971 103,067 102,310 196,350 307,707

Other non-current assets 204,809 216,737 212,874 187,126 197,780 191,469

Inventories - - - 279,859 378,002 352,394

Trade debts - - - 64,279 88,101 49,976

Cash and cash equivalents

at the end of the year (148,941) 83,931 100,834 172,096 (346,216) (234,569)

Current assets 641,991 400,560 426,277 597,016 552,418 516,437

Quick Assets - - - 317,157 174,416 164,043

Total assets 999,316 735,268 742,218 886,452 946,548 1,015,613

Ordinary share capital 61,576 61,576 61,576 61,576 61,576 61,576

Preference share capital - - - - - -

Reserves 442,470 433,213 463,849 497,888 137,406 239,647

Total equity 504,046 494,789 525,425 559,464 198,982 301,223

Surplus on revaluation

of fixed assets - - - - - -

Non-current liabilities 14,984 8,124 8,248 12,606 13,926 42,079

Current liabilities 480,286 232,355 208,545 314,382 733,640 672,311

Total liabilities 495,270 240,479 216,793 326,988 747,566 714,390

Total equity and liabilities 999,316 735,268 742,218 886,452 946,548 1,015,613

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Profit and loss 2003 2004 2005 2006 2007 2008

-------------------------------------------------------------------------------------

in PKR 000 s

-------------------------------------------------------------------------------------

Net sales 1,556,623 1,217,507 1,489,952 1,939,515 2,376,408 3,081,879

COGS 1,127,273 874,068 964,296 1,208,264 1,488,073 1,924,766

Gross profit 429,350 343,439 525,656 731,251 888,335 1,157,113

Operating profit / EBIT -5,290 42,540 167,017 294,461 352,872 552,544

Finance Cost 16,278 5,794 6,111 4,345 6,798 22,233

Profit before tax -21,568 36,746 160,906 290,116 346,074 530,311

Taxation -4,250 15,215 62,536 102,137 121,582 181,765

Profit after tax -17,318 21,531 98,370 187,979 224,492 348,546

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2003 2004 2005 2006 2007 2008

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PROFITABILITY RATIOS

--------------------------------------------------------------------------------------

Profit Margin -1.11% 1.77% 6.60% 9.69% 9.45% 11.31%

Gross profit margin 27.58% 28.21% 35.28% 37.70% 37.38% 37.55%

Return on Assets -1.73% 2.93% 13.25% 21.21% 23.72% 34.32%

Return on Equity -3.44% 4.35% 18.72% 33.60% 112.82% 115.71%

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LIQUIDITY RATIOS

-------------------------------------------------------------------------------------

Quick Ratio 1.00 1.00 1.00 1.01 0.24 0.24

Current Ratio 1.34 1.72 2.04 1.90 0.75 0.77

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ASSET MANAGEMENT RATIOS

-------------------------------------------------------------------------------------

Inventory Turnover(Days) 67.00 86.00 60.00 65.00 81.00 69.00

Day Sales Outstanding (Days) 36.00 27.00 17.00 13.00 12.00 8.00

Operating cycle (Days) 103.00 113.00 77.00 78.00 93.00 77.00

Total Asset Turnover 1.56 1.66 2.01 2.19 2.51 3.03

Sales/Equity 3.09 2.46 2.84 3.47 11.94 10.23

-------------------------------------------------------------------------------------

DEBT MANAGEMENT RATIOS

-------------------------------------------------------------------------------------

Debt to Asset 0.50 0.33 0.29 0.37 0.79 0.70

Debt to Equity Ratio 0.98 0.49 0.41 0.58 3.76 2.37

Long Term Debt to Equity 0.03 0.02 0.02 0.02 0.07 0.14

Times Interest Earned -0.32 7.34 27.33 67.77 51.91 24.85

-------------------------------------------------------------------------------------

MARKET RATIOS

-------------------------------------------------------------------------------------

Earnings per share (2.81) 3.50 15.97 30.53 36.46 56.60

Price/Earnings Ratio (87.12) 82.94 21.91 16.18 36.35 29.31

Dividend per share - 10.00 11.00 25.00 94.88 39.99

Book value per share 81.85 80.35 85.32 90.85 32.31 48.92

No of Shares issued 6,158,000 6,158,000 6,158,000 6,158,000 6,158,000 6,158,000

Market prices(Year end) 245.00 290.00 350.00 494.00 1325.00 1659.00

======================================================================================

MMaarrkkeett sshhaarree::

OVERVIEW : This subsidiary of US multinational has maintained impressive growth in sales, which registered 22% growth. Gross margin improved by 7 percentage points to 35.3% from 28.3%.

Gross margin improved due to volume growth in higher margin products, reduction in trade discounts, de-listing of low margin bakery business in Food solutions and improved pricing in exports.

Higher gross profit provided funds to invest in the key brands-Knorr and Rafhan. Advertising and promotion budget increased to build brands through TV media, brand activation and consumer promotions.

The company's innovative "Knorr Magic Chef" TV programme was extremely positive in building Knorr as informed by directors.

During the year the company's Earnings Per Share (EPS) improved substantially from Rs 3.50 in the preceding years to EPS at Rs 15.97 for the year under review. The company invariably declares high cash dividends and for the year 2005 cash dividend was announced at Rs 16 per share.

Its shares are blue chips and at current market price of Rs 336 per 10-rupee share the PER (Price Earning Ratio) is 21 times of EPS signifying confidence of the stakeholders in the enterprise.

Rafhan Best Foods Limited is a public limited company incorporated in the province of Punjab having its registered office situated at 52 km, Multan Road, Peshawar, Bhai Pheru, Distt Kasur. The shares in the company are quoted on the Karachi and Lahore stock exchanges. Its principal office is in the province of Sindh at Avari Plaza, Fatima Jinnah Road Karachi.

The company was listed on the Karachi stock exchange in 1998. During the last 52 weeks, the market value of the share shot up to Rs 368 per share from Rs 285 per share. The latest market price of the share was quoted at Rs 336 on May 8 2006.

The paid up capital of the company is relatively small and has not changed since the year 2000. While the paid up capital is Rs 61.58 million but the present market capitalisation works out to 2,069 billion.

The company is subsidiary of Conopco Inc USA who owns 74% shares of the company but its ultimate parent company is Unilever N.V. Holland. The company directors, their spouse and children's aggregate holdings are 11% of its total 6.158 million shares. Its 719 individual shareholders own 14.99% its stock.

As regards profit distribution record, it can be seen from the six years statistics published in the Annual Report, that except for 2003, when its bottom line was in the red, the company regularly declared dividends. During the last six years the dividend payouts were highly attractive which ranged between 91% and 190%. The highest dividend of 190% was declared in 2001. For the year under review, cash dividend payout was announced at 160 percent as compared to 100 percent in the previous year.

Rafhan Best Foods Limited manufactures and sells consumer and commercial food products under brand names of Rafhan, Energile, Glaxose-D and Food solutions.

Rafhan is one of the oldest and trusted brands in the country. Today Rafhan brand is 4 decades old and household name, signifying healthy corn oil and complete desert range.

Knorr came to Pakistan in 1992 with the launch of Knorr Chicken Cubes. Glaxose-D is a fifty year old brand which was acquired by the company from GlaxoWellcome in January 1999.

Energile is another popular brand of the company. This drink is available in flavours of mixed fruit, orange, pineapple, peach, mango and lemon flavours. During the year under review, Energile was relaunched with improved product and packaging.

It is interesting to visualise the company's directors perception about their customers and food solutions. It has been stated that their consumers are chefs and their customers range from caterers, restaurants fast food chains to five-star hotels. It has been also emphasized that the company works with them to create food solutions that help growth business. Their solutions vary as widely as their customers - products that add the right seasoning, flavour or texture, prepared ingredients that save time in a busy kitchen and new ways of serving food on a large scale at constant quality are just some examples.

During the year under review, the company posted sales in the sum of Rs 1.490 billion (Rs 1.218 billion in 2004) and gross profit at Rs 525.66 million (Rs 344.12 million 2004) registering impressive growth of 22.4% and 52.8% respectively over preceding year's. Key drivers to the commendable sale growth were focus on retail trade to increase coverage, aggressive, on ground activities, effective communication and above all consumer-led focused promotions.

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Unilever understands the importance of diversity and that's why it is a critical component of our business strategy and an integral part of everything we value and do.

At Unilever, we have a diverse consumer base with a diverse array of needs. By mirroring that diversity within our own organization, we can develop powerful consumer insight and incorporate it throughout our business. We

seek and welcome unique talents and perspectives at Unilever, because they strengthen us as a company and help us on our journey to add vitality to life in a variety of ways.

Unilever has created many avenues to enhance and expand the diversity of the company. Led by senior management, our diversity councils help shape the diversity and inclusion philosophy we deliver to employees. Through training and awareness efforts, employees appreciate the power of diversity and the need to leverage the unique ideas, experiences and abilities we all possess to build our business.

Our recruitment strategy continues to evolve to ensure that our workforce reflects the demographics of our consumer base and fulfills the talent needs that will keep Unilever competitive and successful now and in the future.

Diversity for growth

Unilever believes that working in an environment of openness and respect helps employees perform at their very best and ultimately succeed.

When employees express their own thoughts and ideas - and encourage others to do so - it contributes to a diverse marketplace of ideas that helps make Unilever a more robust organization with a better understanding of its markets. Because Unilever's diverse employee base reflects the broad backgrounds of our consumers, we're able to anticipate and respond to what they want more quickly.

Our employees express pride and satisfaction when we're first to market innovative products that meet consumers' evolving needs. The individual uniqueness of each and every employee, and our commitment to growing diversity, make that possible.

Diversity at Unilever

Unilever recognizes the strength of inclusion and diversity. Understanding, respecting and valuing our similarities and our differences are powerful and compelling concepts for today's business environment. They are also the tenets by which we have outlined a fundamental business strategy to assist in reaching our goals.

1. Recruit

Recruit a diverse workforce that appropriately reflects the demographics of our consumer base and fulfills the talent needs that will keep Unilever competitive and successful. Diversity furthers our understanding of the marketplace by valuing the ideas and thoughts of all employees and other stakeholders in the business.

2. Retain

Retain employees by fostering an environment in which all employees understand and value each other - and our differences. We recognize that all businesses change over time. For our business to grow, we need employees who possess an in-depth understanding of the business and the flexibility to anticipate and respond to changes in the marketplace.

We can develop and retain employees by providing equitable opportunities, together with a challenging environment that rewards new approaches, risk-taking and novel points of view, thereby creating a culture that values diversity.

3. Grow the business & innovate

Continually grow our business and innovate by embracing diversity of thoughts and ideas. Create a work environment that fosters and supports enthusiasm, business risk and new ideas. Innovation is key to driving our business forward both now and over the long term and it hinges on a multiplicity of ideas and ways of approaching a problem. By building a diverse employee population that brings many different life experiences to the table, we vastly improve our prospects for innovation and growth.

4. Develop

Develop employees to help them reach their professional potential. As our customers and distribution channels continue to evolve, so too must our employee base. Investing in the development of employees is essential to our growth.

5. Hold accountable

Establish accountability. All employees are responsible for proactively supporting Unilever's goals, and they are evaluated accordingly. Specific

behaviors and actions that promote an understanding and appreciation of diversity are incorporated into individual performance plans.

Diversity is one of the thrusts of Strategy Into Action, the plan that drives all aspects of our business. Employees are expected to contribute to the success of diversity goals just as they are expected to contribute to other priorities of the business

By focusing on our goals for diversity as part of our overall business strategy, we recognize that they are intertwined. Indeed, our success and prosperity are inextricably linked to our ability to embrace diversity in every part of the organization. Valuing diversity is the job of everyone - our employees, contractors, and vendors. It is the way we work and the way we do business, day in and day out.

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