Univar N'V' 2003 Financial Results

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Univar N.V. 2003 Financial Results

• March 12, 2004 Amsterdam, The Netherlands

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Key Results 2003

• EBITA increased to USD 117.0 million from USD
  106.9 in 2002, up 9.3.
• EBITA improvement essentially due to reductions
  in operating expenses, record performance in
  Canada and foreign currency movements.
• Sales were essentially flat in the US and
  actually declined (in local currency) in Europe.
  Some 4th quarter growth momentum was notable in
  the US.
• Underlying profitability was sufficient to absorb
  increased pension and insurance costs and
  strike-related costs all totaling USD 30.8
  million

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Key Results 2003 (contd)

• Operating expenses were reduced to 13.8 of sales
  from 14.1 in 2002. Expense reductions largely
  in the US and Europe.
• Net income increased significantly to USD 42.2
  million (USD 1.45 per share) from USD 24.2
  million (USD 0.83 per share) in 2002.
• Net income improvement due to increase in EBITA
  and a much lower effective income tax rate.
• EPS excluding goodwill amortization increased by
  44 to USD 2.08 from USD 1.44 in 2002.

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Key Results 2003 (contd)

• Full-year guidance was exceeded
• Second half EBITA of USD 58.9 million exceeded
  expectations significantly, comparing against an
  unusually high year-ago figure (USD 60.3
  million), and also considering that USD 5.9
  million in strike-related costs fell entirely
  into the 2nd half.

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Reduction in effective income tax rate

• Overall income tax rate for 2003 was reduced to
  33.6 from 56 in 2002.
• High rate in 2002 largely due to non-deductible
  goodwill amortization. Tax rates will decline as
  operating income increases.
• 2003 tax events
• Internal corporate restructuring completed at
  year-end.
• Available loss carryforward used to offset tax on
  USD 3.2 million gain on sale of UK facility.
• Estimated 2004 tax rate is in the range of 40 to
  44. Somewhat dependent on increase in operating
  income.

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Univar NV
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Univar USA
Sales flat due to weak manufacturing sector until
4th quarter. Significant expense reductions
achieved despite USD 18.8 million increase in
pensions, insurance and strike-related costs.
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Univar Europe
Sales increase and nearly flat operating income
largely due to strengthened Euro.
Currency-neutral sales and operating income
decreases due to very weak manufacturing sector.
Significant success in operating expense
reductions despite higher pension and insurance
costs.
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Univar Canada
Solid growth once again. Very strong in
resource-based western provinces. Canadian
management very proud of their first CAN 1
billion sales year.
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Univar was neither well served by the world
economy in 2003, nor were we stymied by it.

• In relative terms, we are quite pleased with our
  performance for the year.
• Despite problems associated with the Iraq war,
  continuing economic stagnation in the industrial
  markets we serve, volatility in chemical and
  energy pricing, and significant increases in
  uncontrollable costs, Univar was able to achieve
  year-over-year improvement in operating profit.
• We met our economic commitment to the marketplace
  by delivering EBITA that not only equaled but
  exceeded 2002s result.

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In looking at our results, it is easy to lose
sight of the real accomplishments of 2003.

• Its hard not to notice the 74 year-over-year
  increase in net income driven by the reduction in
  our effective tax rate.
• One could interpret a positive surprise in 2nd
  halfand especially 4th quarterresults as an
  indication of recovery in our underlying markets.
• But the real story of 2003 is what we have done
  to change the underlying cost of doing business
  at Univar.

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Underlying profitability improved sufficiently to
absorb uncontrollable cost increases totaling USD
30.8 million.

• Operating expenses (currency-neutral) actually
  decreased year-over-year despite the large
  increases for pension and insurance expenses and
  strike-related costs from a labor dispute in the
  US.
• This structural operating benefit was
  accomplished through continuous improvement
  activities throughout our organization designed
  to enhance efficiency and productivity in the
  network across multiple operating dimensions.
• 2003 expense decreases followed on cost
  reductions of USD 32.2 million in 2002.

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The improvement in the cost structure at Univar
is sustainable and can be further optimized.

• While we cannot assure future cost reduction
  benefits at the level achieved over the past two
  years, we can promise to remain on the casenot
  just this yearbut every year.
• Our challenge in 2004 is to grow market share.
• Univar has yet to experience the full effect of a
  robust economic recovery. Our hope and
  expectation in the months ahead is to do so, and
  in the process, to kick our sales machine into
  gear.

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Outlook for 2004

• We are well positioned to improve our performance
  in 2004, dependent upon a variety of mostly
  external factors, especially the health of the
  manufacturing sector of the economy.
• We will continue to focus on our longer-term
  goals presented last year
• To strengthen Univars market position over time
• To provide sustainable revenue and earnings
  growth while maintaining a sound balance sheet
• To achieve average annual growth in net sales
  over the next 2 years of between 1 - 2 in
  excess of growth in local GDP
• To improve EBITA margin to 3.5 or more within
  2-4 years
• To attain a net debt-to-EBITDA ratio of 2.51
  with an interest coverage ratio of at least 5
  times

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