• briefing asia infrastructure aug 15, 2006 • briefing asia energy aug 15, 2006

investment plan to nurture brands.
10. GlaxoSmithKline
United Kingdom
www.gsk.com
Sales: $1.7 billion
Sales: $1.7 billion for oral care products. Corporate sales: $39.3 billion. Net income: $8.7 billion.
Key Personnel: Jean-Pierre Gamier, chief executive officer and John Clarke, president, consumer healthcare.
Major Products: Toothpaste and mouthwash--Aquafresh, Dr. Best, Macleans, Odol, Odol Med 3, Polident, Polygrip, Sensodyne; Denture care--Polident, Polygrip and Corega.
Comments: Sales of oral care products rose 2% last year. Sales of Sensodyne were up 12%, while sales of denture care brands Polident, Poligrip and Corega, rose 6%. These gains helped offset lower sales of other toothpaste products.
For the first quarter of 2006, oral care sales rose 7% to $424 million with growth in all regions. Sales of Sensodyne jumped 21%, while sales of Aquafresh, GSK's largest oral care brand, were flat at $128 million.
11. Yves Rocher
France
www.yvesrocher.com
Sales: $1.6 billion
Sales: $1.6 billion for cosmetics and toiletries. Corporate sales: $1.9 billion.
Key Personnel: Yves Rocher, founder and chairman; Bris Rocher, owner and managing director; Jacques Rocher, owner and managing director; Frank Botti, chief executive officer, Yves Rocher North America.
Marketing Director: Anne Kayser.
Major Products: Skin care, cosmetics and fine fragance.
New Products: Serum Vegetal Corrective Intervention, Bronze Nature, Aloe Vera Essential and Spa Energie Vegetale with oligo elements. To be launched: Secrets d'Essences Voile d'Ambee (September) and Ginseg Actif (October).
Comments: Corporate sales rose about 5% last year.
12. Kose
Japan
www.kose.co.jp
Sales: $1.5 billion
Sales: $1.5 billion. Net income: $88 million for the year ended March 31, 2006.
Key Personnel: Reijiro Kobayashi, chairman; Yasukiyo Kobayashi, president; Kazutoshi Kobayashi, executive vice president; Shinji Nishina, executive director.
Major Products: Skin care, cosmetics and toiletries.
New Products: Cosmetics--Cosme Decorte White Science, Predia Spa des Grands, Beaute de Kose Classure and Astalution. Cosmetaries--Fasio mascara, Softymo cleansing series, Salon Style hair care and Coen Rich Q10 hand cream.
Comments: Sales rose 4.6% and net income was up 6.1%. By product category, cosmetics accounted for 73.6% of sales, followed by cosmetaries, 24.3% and other, 2.1%. Sales of high-value-added brands were strong. Also contributing to sales growth were strong performances by Infinity, a drugstore brand, and Albion skin care products, which are sold in department stores. As a result, cosmetics sales exceeded the company's plan for the fiscal year. International sales soared 17.8%, due to a successful advertising campaign featuring a local popular actress in China, Hong Kong and Taiwan, and the introduction of Beaute de Kose, a high-prestige brand sold through leading department stores. Looking ahead, Kose executives predict that Japan's economic recovery will continue and demand for cosmetics will continue to stage a recovery. However, the company foresees new challenges posed by factors such as the instability of the cost of crude oil and increasing global competition among companies. To meet these challenges, the company is strengthening its marketing activities, entering new sales channels and expanding into new business segments. For example, in the cosmetics business, a business unit has been established for the core Cosme Decorte brand. In the cosmetaries business, Kose plans to start a new business by using products bearing brands licensed from overseas companies. Outside Japan, Kose will continue to work on raising sales by positioning China, Taiwan and Korea as the core markets. Helped along by reforms in supply chain management, Kose expects sales to rise 4.5% during the year ending March 31, 2007.
13. Amore Pacific
Korea
www.amore.co.kr
Sales: $1.3 billion
Sales: $1.3 billion. Net income: $162 million.
Key Personnel: Kyung-Bae Suh, president and chief executive officer.
Major Products: Skin care and make-up--Laneige, Iope, Mamonde, Innisfree, Hera, Lirikos. Fragrances--Lolita Lempika, Castel Bajac, Espoir.
New Products: Laneige Sliding Pact makeup, Heratlier makeup, Mamonde
Total Solution and Cover Solution skin care, Iope Magic Effecter skin whitener.
Comments: Cosmetic sales rose 6% last year as the company successfully rolled out enhanced product lines in the premium sector and revamped its distribution network. International sales jumped more than 15% and the company now operates more than 200 sales counters around the world. The mass beauty division reported an 8.5% gain in sales, primarily the result of brand consolidation. These gains came during a year when the Korean cosmetics market was beginning to reawaken after slumping since 2002. While sales in specialty stores continued to decline in 2005, the market received a big boost from department stores and door-to-door sales.
In December, AmorePacific launched the Innisfree Herb Station, its first stand-alone beauty store. It represents the brand's unique "naturalism lifestyle," and stocks more than 650 various products employing herbal ingredients from Provence, from skin care products to makeup, body care, hair care and men's grooming. The company has high hopes for the beauty store concept--hoping to add 100 stores by the end of 2006.
According to AmorePacific, Innisfree has been gaining in popularity since its launch in January 2000 as Korea's first natural cosmetics brand. It is based on natural herbal ingredients and features environmentally-friendly packaging.
This year, AmorePacific management is focused on several initiatives. They include:
* Accelerate global expansion, especially in Asia;
* Create customer value by responding to the consumer's needs faster than ever;
* Reduce costs to improve profitability in every channel; and
* Expand Six Sigma activities into regional headquarters and subsidiaries.
This year, AmorePacific executives expect the market to continue growing in both the premium and mass sectors. The premium sectors will get a boost from the macro economic recovery as well as the growing demand for highly-functional products. In the mass sector, the specialty channel, which has been declining for the past few years, is expected to turn around and stabilize.
14. Chanel
France
www.chanel.com
Sales: $1.2 billion
Sales: $1.2 billion (estimated) for cosmetics, toiletries and fragrances.
Key Personnel: Alain Wertheimer, chairman; Francoise Montenay, chief executive officer; Maureen Chiquet, president and chief operating officer; Christine Dagousset, executive vice president, fragrance and beaute.
Major Products: Skin care, color cosmetics and fragrances for men and women.
New Products: Purete Ideale skin care, Sublimage Essential Regenerating cream, Pink Lame eyeshadow, Inimitable mascara.
Comments: While things have been relatively quiet for Chanel during the past year, industry sources note that the company's small mass market division, Bourjois, has been struggling in the fiercely competitive European color cosmetics sector.
In June, Francoise Montenay was elected president of Comite Colbert, the French luxury goods trade association. Ms. Montenay's mission is to promote French ideas of luxury in emerging markets such as China and India.
Next spring, actress Keira Knightley will become the new face for the Coco Mademoiselle scent. She will replace Kate Moss, who had been the spokesmodel for Coco Mademoiselle since its debut in 2001.
14. Clarins
France
www.clarins.com
Sales: $1.2 billion
Sales: $1.2 billion. Net income: $120 million.
Key Personnel: Jacques Courtin-Clarins, chairman of the supervisory board; Christian Courtin-Clarins, chairman of the management board; Lionel de Benetti, chief industrial officer; Gerard Delcour, president, Azzaro; Patrick Bizot, president, Clarins; Vera Strubi, president, Thierry Mugler Parfums and Stella Cardente Parfums; Dr. Olivier Courtin-Clarins, managing director, research and development.
Major Products: Skin care, fine fragrance, color cosmetics and sun care products sold under such brand names as Clarins, Thierry Mugler, Azzaro and Stella Cadente.
New Products: Skin Care--Total Body Lift Stubborn Cellulite Control, Extra Firming Day Cream and Extra Firming Night Cream, Liquid Bronze Self-Tanning; Perfumes--Silver Black, par Amour et par Amour toujours, Garden of Stars, Alien, Miss Me; Makeup--In the Mood for Love, True Comfort Foundation SPF 15, Good Vibrations, Mascara Wonder Volume.
Comments: Sales rose about 7% and net income was up more than 11%. By product category, skin care accounted for 50.6% of sales, followed by perfumes, 40.9% and makeup 8.5%. Clarins estimates the global cosmetics market reached $116 billion in 2005, with the selective distribution segment accounting for about 22% of the market. For its part, Clarins estimates its worldwide share of selective markets to be 5.6%, nearly even with its 5.5% share in 2004. Even so, Clarins remains the No. 1 prestige skin care brand in Europe with a 16% share. In the U.S., Clarins is No. 4 in skin care with a 5.1% share. In Asia, Clarins has 6% share.
Last year, beauty sales were essentially flat. But Clarins executives blamed the sluggish performance on destocking by some European retailers. Still, some products turned in good results. For example, the reformulated Extra Firming line was well-received by women over 40. ClarinsMen also reported good sales gains and the line continued to expand. Makeup sales were up 2.7%, driven by sales of foundations.
But the clear winner in the Clarins' stable was fragrance, where sales soared more than 18% last year. The company credited the addition of two new perfume brands--Clarins and Stella Cadente--as well as the launch of Alien and Silver Black.
By region, Europe represented 59.1% of sales, followed by North America, 25%; Asia, 9.6% and the rest of the world, 6.3%.
Sales in Europe rose just 1.9% due to continued weakness in consumer spending. Among the Big 5, only the UK posted a gain in sales. Good news came out of North America where, despite continued department store consolidation, sales still posted a gain of 10.6%. Growth was strong throughout Asia, where sales were up 21.7%. Sales in the rest of the world rose 19.4%, driven by sustained sales in the Middle East and Latin America.
14. Puig
Spain
www.puig.com
Sales: $1.2 billion
Sales: $1.2 billion.
Key Personnel: Marc Puig, chief executive officer; Manuel Puig, chief development officer; Joan Albiol, president, Puig Beauty; Pilar Trabal, general manager beauty global brands; Maria Lopez Fernandez, marketing director, beauty global brands.
Major Products and Product Managers: Antonio Banderas Seductive Fragrances--Caroline Bourgeois; Mango-Corinne Labadans; Heno de Pravia; Maja: Anna Mancanet; Adolfo Dominguez: Olga Gomez.
New Products: Antonio, Antonio Banderas; Adorably, Mango; Sportman Pro.
Comments: Sales rose a bit in 2005, thanks to the success of the Banderas fragrance franchise. Now the scent is getting even more press with the launch of Antonio, Antonio Banderas, which is described as a musky vanilla fragrance. A portion of the proceeds from the scent goes to Broadway Cares/Equity Fights AIDS, an organization that is close to the heart of actress Melanie Griffith, who happens to be Mr. Banderas' wife as well. The fragrance has already won a couple of Fifi Awards in Spain.
17. LG Household & Healthcare
Korea
www.lgcare.com
Sales: $948 million
Sales: $948 million. Net income: $70 million.
Key Personnel: Suk Cha, chief executive officer.
Major Products: Household--laundry and dishwash detergent, fabric softener, kitchen cleaners. Personal care--toothpaste, shampoo, soap, baby care, color cosmetics and men's toiletries.
New Products: Prestance fragrance, Brestle fabric deodorizer, Bamboo Salt Wonsaengbaek toothpaste.
Comments: Sales were relatively flat last year, but net income soared 97%. A year after being named chief executive officer, Procter & Gamble alum Suk Cha has LG thinking like P&G. For example, last year, LG entered into a joint venture with Unicharm to manufacture and market paper products, including diapers and sanitary napkins, in Korea. More recently, the company rolled out Brestle, a fabric deodorizer. Sounds as if Mr. Cha is trying to bring a bit of Cincinnati to Seoul.
In February, LG opened Scent Berry House, a fragrance R&D center located within Seoul National University. Company executives expect to develop it into a world-class center with 30-50 researchers and a library of about 20,000 different scents by 2010. The center is committed to developing functional scents that connect with the consumer in an emotional way.
In March, the company opened Whoo Spa Palace, a premium skin care boutique named after Whoo, a royal court Oriental medicine-based brand sold at department stores and through direct sales. At Whoo Spa Palace, the company plans to use Whoo and Ohui products and provide unique royal court Asian medicine-based premium skin care services.
This year, LG is determined to increase its sales by 10% and increase its operating margin from 7% to 8%. Within the next year or so, company executives expect operating margin to exceed 10%.
18. Natura
Brazil
www.natura.net
Sales: $942 million
Sales: $942 million. Net income: $164 million.
Key Personnel: Antonio Luiz da Cunha Seabra, co-chairman and founder; Guilherme Peirao Leal, co-chairman; Pedro Luiz Barreiros Passos, co-chairman; Alessandro Carlucci, chief executive officer.
Marketing Director: Eduardo Luppi, executive vice president, innovation.
Major Products and Product Managers: Face, Fragrances and Kids--Renata Eduardo; Body, Shower and Hair Felipe Braz; Makeup and Strategies--Julia Caminhoto.
New Products: Natura Humor, Ekos Rosto, Chronos Spilol. To be launched: Natura Unica (makeup), Kaiak Aventura Feminino (fragrance line), Seve Alecrim (body oil).
Comments: Sales rose nearly 30% last year. Although it is the leading player in the Brazilian cosmetics and toiletries market, Natura has set its sights beyond its borders. Last year, the company started operations in Mexico and plans to set up shop in Venezuela this year. If plans hold, the company will continue with a Colombia launch in 2007, according to Mauricio Bellora, the vice president of Latin American operations for the company, in Sao Paulo.
Natura is already well entrenched in the Southern Cone of South America, with operations in Argentina, Bolivia, Chile and Peru. Within this region it had 36,000 direct sales representatives at the end of 2005, compared with 483,000 in Brazil alone; the total number of sales consultants rose by almost 20% in 2005. Non-Brazilian sales for the company in Latin America were up nearly 39% in 2005, to $38 million. Natura, which commands about 20% of the total Brazilian cosmetics market, invested $13 million for globalization in 2005.
This year, a host of direct sales consultants are expected to be added in Mexico, a key country in Natura's global push. While the company opened what it calls a flagship store in Paris in April 2005, it has not initiated direct sales in France yet. Sales in Mexico, however, are expected to increase quickly thanks to the August 2005 opening of the company's Casa Natura exhibition house in Mexico City's swank Polanco neighborhood, the first of its kind in Latin America outside of Brazil.
"At the Casa Natura, our objective is not sales. Rather, our consultants and consumers can have a Natura experience, drinking a coffee, chatting and building networks, and perhaps having a massage with some of our free samples," Mr. Bellora told industry consultant and HAPPI columnist Charles Thurston. "The Distrito Federal (the capital city) is a large area, and we want to expand step by step; we have plans to be present throughout Mexico."
As it expands into new countries, Natura may rework its product mix.
"Today, all the 400 or so products sold throughout Latin America are the same in every country, but in the future there may be some unique products in some countries," Mr. Bellora said. "Colors in makeup, for example, may be different in Mexico than in Argentina or Brazil; fragrances are another window of opportunity for tailoring products to a specific country market."
During the past year, Natura introduced more than 150 new products, among which the company highlights Chronos Spilol, an anti-aging cream based on the native Brazilian jambu plant. Improvements to Natura's soap lines during 2005 included a 100% switch to palm oil from animal oils.
During 2005, Natura sold seven million units, compared with 4.7 million in 2004, through its direct sales network.
19. Pola
Japan
www.pola.co.jp
Sales: $941 million
Sales: $941 million.
Key Personnel: Satoshi Suzuki, president and chief executive officer; Toshihiro Haruna, executive vice president.
Major Products: Skin Care--Apex-i, Creatage Excellen, B.A, Wrinkle Shot, White Shot W, Polissima, Estina Alvita, Kisui, Whitissimo, Day+Day Vitax, Signs Solution. Makeup--B.A., Augha, Southern Call; Body Care--Bodiest, Feel & Heal; Hair Care--Idea Style; Color Cosmetics--Aniak, Order Color Marlet.
New Products: The Make B.A. Summer prestige makeup, Vivoke makeup, Assist One skin care. To be launched: The B.A. Grandluxe anti-aging serum (December).
Comments: Last year, company executives said they were determined to make Pola one of the premier cosmetics brands in the world. One way to reach that lofty goal is through China and Pola has plans to launch 200 stores across China by 2010.
The Pola salons are premium esthetic spas that "represent the best our company has to offer," according to company officials. The first salon opened in June 2005 in Shanghai, and new stores will be launched elsewhere in China, followed by openings in other Asian markets and North America. The company is also getting set to relaunch its English language website later this year
20. PZ Cussons
United Kingdom
www.cussons.com
Sales: $896 million
Sales: $896 million for the year ended May 31, 2005.
Key Personnel: Anthony J. Green, chairman; Archibald Graham Calder, deputy chairman; Alex Kanellis, chief executive officer; Chris Davis, director, Africa designate; Richard Shepherd, managing director, Cameroon; Gordon Robinson, managing director, China; Panos Varelas, chief executive, Nigeria; Panos Mouchteros, managing director, Ghana; George Sotiropoulos, managing director, Indonesia; Dimitri Papadimitriou, managing director, Kenya; Stephen Murphy, managing director, Poland; Huw Morris, managing director, Middle East and South Asia; Ilias Grigoris, managing director, Thailand; John Hunt, managing director, Malaysia; Costas Theodorakopoulos, managing director, Nigeria; George Kostianis, managing director, Greece.
Major Products: Personal Care--Imperial Leather, Joy, Foamburst, Carex and Juksja soaps; Cussons Kids toiletries; Sweet Seventeen teen products; Venus creme relaxers; Flourish toothpaste, Robb mentholated rub. Home Care--Morning Fresh liquid dishwash, Elephant, E, Radiant, Tugaris detergents, Duck laundry soap.
Comments: Sales rose more than 5% last year. PZ Cussons has made several significant investments during the past year. In Nigeria, the detergent factory at Ikorodu was expanded by 15% and the soap factory in Aba by 30%. Similarly, the company is expanding production in Indonesia to meet growing demands for baby care products.
On May 31, 2005, Nigel Green retired as chief executive officer. During his 10-year term, Mr. Green led the company through notable growth and significant change.
For the six months ended November 30, 2005, sales increased 11%. In the UK, the relaunch of the Imperial Leather shower range was well-received and the Charles Worthington hair care brand, purchased in 2004, has been expanded with Results for Men and Dream Hair.
During the first half of the year, the company successfully restructured its business in Poland. Sales in Greece were flat. In Africa, sales rose due to the launch of several new products and in Australia, sales were ahead of the previous year due to sales of Trix laundry detergent, which was acquired in mid-2005. Most recently, the company sold the North American rights of Charles Worthington to Beautology.
21. Body Shop
United Kingdom
www.thebodyshop.com
Sales: $874 million
Sales: $874 million for the year ended Feb. 28, 2006.
Key Personnel: Adrian Bellamy, executive chairman; Peter Saunders, chief executive officer.
Major Products: Hair and skin care products, fragrances and color cosmetics sold under The Body Shop brand.
Comments: The sale of The Body Shop to L'Oreal earlier this year marks the end of an era in cosmetic retailing. Thirty years ago company founder Anita Roddick thumbed her nose at the corporate world to create her vision of a green business. But now, Mrs. Roddick finds herself a cog in the corporate wheel after selling The Body Shop for more than $1 billion.
The sale came at a time when The Body Shop was beginning to turn things around after several lackluster years. Sales rose 16% last year. By region, sales in the Americas rose 13% to nearly $290 million. Sales got a boost from The Body Shop at Home and e-commerce. At the close of the year, the Americas had 444 company shops--322 of them located in the U.S.
Sales in Asia Pacific surged 34% to nearly $155 million. The good results were attributed to a combination of strong brand positioning, good in-store execution and improving economies in the region. Good performances were reported in Malaysia, Indonesia, Taiwan, Singapore, Japan and Hong Kong. There were 605 retail stores in the region at the end of the fiscal year.
Europe, the Middle East and Africa reported a 27% gain in sales to nearly $170
million. Sales in the Middle East jumped 11% and sales in the Nordic region were up 12%. France, too, posted double-digit gains (11%).
In the UK and Republic of Ireland, sales rose 5% to $260 million. Sales were helped along by a 15% gain posted by The Body Shop at Home. There were 305 retail stores in the region at the close of fiscal 2005.
22. Oriflame
Belgium
www.oriflame.com
Sales: $858 million
Sales: $858 million for cosmetics, toiletries, skin care and fragrances. Corporate sales: $953 million. Net income: $112 million.
Key Personnel: Robert af Jochnick, chairman; Magnus Brannstrom, chief executive officer; Jesper Martinsson, chief operating officer; Kevin Kenny, chief financial officer; Marco Greidinger, global supply director; Inge Heinsius, global marketing director.
Major Products: Cosmetics, fragrances, skin care and toiletries.
New Products: Optimals skin care line, Time Reversing skin care line, Colour Matt Glam lipstick, S8 men's fragrance and men's grooming range, and Saga and Lucia women's fragrances.
Comments: Corporate sales rose more than 14% last year. By product sector, color cosmetics accounted for 28% of sales, followed by fragrances (23%), skin care and toiletries (19%, each) and accessories (10%).
In December, Oriflame sold its UK and Ireland operations to Premier Direct Group, which will continue Oriflame sales operations in these countries. When making the announcement, Oriflame executives noted that the unit had been losing money for years.
For the first quarter of 2006, sales jumped 29% to $281 million. The sales force increased 10% to nearly 1.8 million consultants. The company credited the sales gain to more consultants as well as productivity improvements. During the quarter, the company's factory in China began production. Later this year, Oriflame, together with Weckerle Group, will begin manufacturing lipsticks in Russia.
23. Pierre Fabre
France
www.pierre-fabre.com
Sales: $815 million
Sales: $815 for cosmetics. Corporate sales: $1.8 billion.
Major Products: Skin care and hair care products marketed under such brand names as Avene, Ducray, Pierre Fabre Dermatologie, Klorane, Galenic and Rene Furterer.
New Products: Elgydium whitening toothpaste.
Comments: Corporate sales rose less than 1% last year.
Cosmetics account for 45% of the group sales. The company is already well-established in skin care, and now is expanding its presence in oral care with the April launch of two teeth whitening products. Elgydium iWhite combines a whitening active ingredient to an electroluminescent tray, a source of energy thanks to light. The Metatray focuses a concentrated active, light and heat for an even more visible whitening effect, according to the company.
24. YSL Beaute
The Netherlands
www.guccigroup.com
Sales: $763 million
Sales: $763 million.
Key Personnel: Francois-Henri Pinault, chairman.
Major Products: Fragrances, cosmetics and skin care products. Brands include Yves Saint Laurent, Roger&Gallet, Stella McCartney, Alexander McQueen, Boucheron, Ermenegildo Zegna, Van Cleef & Arpels and Oscar de la Renta.
New Products: My Queen and Z Zegna fragrances.
Comments: Fragrances accounted for 67.1% of sales, cosmetics, 25.9%; skin care products, 6.6% and other, .4%. By region, Europe represented 68.5% of sales, followed by North America, 14.8%; Asia (excluding Japan), 6.2%; Japan, 5.3% and rest of the world, 5.2%.
Cinema, YSL's women's fragrance which debuted in late 2004, continued to set sales records in 2005. In fact, the scent has become one of YSL's best-sellers behind Opium and Paris. However, sales of Oscar de la Renta and Van Cleef & Arpels suffered as a result of distribution problems.
The new year got off to a rocky start, with YSL Beaute sales rising less than 1%. As a result, the company announced a relaunch plan that is designed to improve competitiveness.
25. Colomer
Spain
www.thecolomerroomgroup.com
Sales: $600 million
Sales: $600 million (estimated).
Key Personnel: Carlos Colomer Casellas, chairman; Michael Powell, president, Colomer USA.
Major Products: Professional--Revlon Professional, Intercosmo, MOP, American Crew, D:FI, Creative Nail; Consumer--Natural Honey, Longueras, Fermodyl, Geniol, Lanofil, Fixpray, ZP11; Cosmetics--BioPoint, Burberry (license), ST DuPont (license), Ultima II (license), Gatineau (license), Revlon (license); Multicultural African Pride, Revlon Realistics, Creme of Nature, Fabu-Laxer, Arosci.
Comments: Colomer is owned by CVC Capital Partners, one of the largest private equity groups in the world. Colomer has a widespread portfolio, with approximately 66% in professional hair care, 15% in ethnic hair care and 10% in professional hair care. Sales are spread across western Europe, the U.S. and Latin America.
26. The Bolton Group
The Netherlands
www.boltongroup.com
Sales: $585 million
Sales: $585 million (estimated) for household and personal products. Corporate sales: $1.2 billion.
Key Personnel: Jo Nissim, president; Freddie Martell, group director; Luigi Castria, group business development manager.
Major Products: Household cleaners, personal care and cosmetics.
Comments: According to industry sources, The Bolton Group has sales of nearly $600 million in HAPPI'S area of interest. However, nearly half of corporate sales (46%) come from food. Established in 1949, The Bolton Group has operations in Europe, the Middle East, the Americas and Australia.
The company's Manitoba unit, which includes brands such as Brill and Solitaire, has sales of about $300 million. Manetti-Roberts, a leader in toiletries, has sales of $200 million. Collistar, Bolton's prestige color cosmetics division, has sales of about $70 million. Finally, Triplex, The Bolton Group's unit in Greece, is active in household, personal care and food. Italy accounts for 49% of sales, followed by France, 19% and the rest of the world, 9%.
With a large production facility in Firenza, Manetti have strong positions in the mass market in Italy with its Neutro Roberts brand, which holds the No.2 position in the deodorants segment, and has good shares in personal washing (bath, shower, soap, etc), as well. But because so many of Manetti's products are medium-priced, margin is a problem, as its brands are left to fight it out in the middle of the mass market, with little or no premium positioning.
In January, Bolton's Manetti & Roberts unit acquired Sanogyl from Unilever. The toothpaste brand is sold in France, in both the mass market and pharmacy channels. According to company executives, this acquisition provides an opportunity for Bolton Solitaire and Roge Cavailles to grow in this new market through their respective channels.
Also in January, the Bolton Group opened a new distribution in Zagreb, called Bolton Croatia.
27. Sunstar
Japan
www.sunstar.com
Sales: $575 million
Sales: $575 million (estimated) for the year ended March 31, 2006.
Key Personnel: Hiroo Kaneda, chief executive officer.
Major Products: Oral Care--GUM, Ora2 and Butler brands. Personal care--Tonic body and skin care; Household--Dry Up laundry detergent.
Comments: At press time, Sunstar had still not released sales for the year ended March 31, 2006. The company had been projecting gains of 7%, but if recent history is any indication, the rise in sales will be closer to 3%.
28. Menard
Japan
www.menard.co.jp
Sales: $548 million
Sales: $548 million (estimated) for the year ended March 31, 2006.
Key Personnel: Daisuke Nonogawa, chairman; Junichi Nonogawa, president.
Major Products: Skin care, cosmetics and fragrances.
Comments: With the bulk of its sales coming from Japan, Menard's sales have been declining a couple of percentage points every year for the past several years. Still, the company ranks among the leading players in the Japanese personal care industry.
29. Mandom
Japan
www.mandom.co.jp
Sales: $424 million
Sales: $424 million for the year ended March 31, 2006.
Key Personnel: Motonobu Nishimura, president and chief executive officer.
Major Products: Men's toiletries, including brands such as Gatsby and Lucido. Women's toiletries, including brands such as Lucido-L and Simplity.
New Products: Gatsby--Styling Wax, Ice Deodorant Shower Lotion, Facial Paper, Shower Fresh, Deodorant Powder Spray, W-System Foot Deodorant Spray, Nose Pore Clear Pack; Lucido---Natural Color for Gray Hair; Mandom-Grapefruit Facial Wash/Grapefruit Face Lotion; Lucido-L-Fiber in Clay; Simplity--Deodorant foot spray.
Comments: Mandom is the leading player in the Japanese men's grooming category. The company is somewhat of a pioneer, too. Back in 1958, it became the first Japanese cosmetic company to establish a plant outside Japan when it opened a facility in Manila. This year marks the 10th anniversary of the opening of its production plant in Zhongshan City, Guangdong Province, China.
30. Noevir
Japan
www.noevir.co.jp
Sales: $325 million
Sales: $325 million for cosmetics. Corporate sales: $527 million. Net income: $12.4 million, for the year ended Sept. 20, 2005.
Key Personnel: Hiroshi Okura, chief executive officer; Takashi Okura, chief operating officer; Hisashi Okura, vice president.
Marketing Director: Minoru Ito.
Major Products: Skin Care--Noevir 99, Noevir 505, Nov. III, Sana Nameraka Honpo. Color cosmetics--Noevir 5.
New Products: Moisture Repair beauty treatment, Excellent Day Emulsion foundation, Sana Pore Putty makeup base, Blancnew Reset W whitening treatment, Noevir 5 Treatment Emulsion Foundation.
Comments: Cosmetics and toiletries account for slightly more than 60% of Noevir's annual sales. The company also has a strong presence in nutritional and pharmaceutical products. Among the new products from Noevir is Moisture Repair beauty treatment, which contains rice extract and ceramides to help plump and moisturize the skin. New Excellent Day Emulsion foundation, is billed as a luxurious cream foundation that uses a unique nano-emulsion formula to help hydrate and pamper the skin. Finally, Sana Pore Putty makeup base promises to virtually erases pores, for flawless and longer-lasting makeup application, according to the company.
COPYRIGHT 2006 Rodman Publishing
Document HPPI000020060908e2810001e

PCs for the Poor - As Good As Their Hype?
by Waleed Al-Shobakky

2,242 words

31 July 2006

02:55 PM

All Africa

AFNWS

English

(c) 2006 AllAfrica, All Rights Reserved
Jul 31, 2006 (SciDev.Net/All Africa Global Media via COMTEX) --
Technologists are at odds over how to bridge the digital divide. What one group calls the ultimate solution, another dismisses as "the scam of the century", reports Waleed al-Shobakky.
At the 2005 World Economic Forum in Switzerland a soft-spoken academic made an announcement that sent seismic waves across the computer industry. Nicholas Negroponte, then director of the Massachusetts Institute of Technology's Media Lab, spoke of making laptops available at US$100 for schoolchildren in developing nations.
The price was not the only big news. Negroponte named companies that had agreed to collaborate on what would become the One Laptop Per Child (OLPC) project.
Notably, the list did not include Microsoft and Intel, the world's largest software and microchip manufacturers, respectively. Instead, the laptop would use a processor from Advanced Micro Devices and an operating system based on Linux, whose code is freely available for anyone to modify and distribute.
The technology race
A cascade of announcements followed. In November 2005, Negroponte demonstrated the first prototype at the UN's World Summit on the Information Society in Tunisia.
Microsoft soon responded. At the January 2006 Consumer Electronics Show in Las Vegas, United States, Bill Gates unveiled his company's answer: a prototype cellphone that could be turned into a computer by connecting it to a TV and keyboard.
Microsoft touted its Cellular PC as a cheaper and more practical alternative, since it relied on components already in use. Craig Mundie, Microsoft's chief research and strategy officer told The New York Times, "everyone is going to have a cellphone ... in places where TVs are already common, turning a phone into a computer could simply require adding a cheap adaptor and keyboard."
In February, leading Taiwanese microchip manufacturer Via showed off prototypes it has developed for its PC-1 initiative, which aims to enable a billion people to connect to the Internet using cheap and energy-efficient notebook and desktop computers.
Then in May, Intel's chief executive officer Paul Otellini launched his company's foray into the low-cost computing arena with EduWise, a US$330-400 'education notebook PC' aimed at developing nations.
Intel spokesperson Mike Green says EduWise has an advantage over the OLPC laptop in that it can accommodate more standard software and tools. Its hardware will be almost identical to that of regular computers. Moreover, it will use Microsoft's Windows operating system, which runs about 90 per cent of the world's personal computers and is compatible with more software applications than most other operating systems.
Negroponte's US$100 laptop, with its trimmed-down hardware, has drawn criticism from Otellini. "We do not think you [can] cross the digital divide with old technology," he told The New York Times in May. "[EduWise] doesn't need exotic technology and it runs real applications."
These are not the first attempts to provide affordable computing for the poor. Back in 2003, Advanced Micro Devices introduced its Personal Internet Communicator, a relatively cheap box that could be used to access the Internet when it was connected to a screen and a keyboard. But it couldn't be used as a word processor, and it cost US$400 -- both major weaknesses. The company ended up pulling the plug and partnering with Negroponte instead.
Starting simple
Prior to all these initiatives was the Simputer -- a simple, inexpensive, multilingual people's computer, probably the first serious effort to develop an affordable computer.
The first prototype, launched in mid-2001, was a handheld device close in size to today's PDAs (personal digital assistants). It was the product of a collaboration between Indian entrepreneur Vinay Deshpande and scientists at the Indian Institute of Science, including Swami Manohar, who came up with the device's name.
Simputer's pioneers believe that the current excitement over low-cost computing initiatives is largely due to their project. But they accept that, for several reasons, their device was not widely adopted. "Perhaps we were somewhat naive back in 2001 when we announced the Simputer without having ready-made applications for it," says Deshpande.
Moreover, he says, because it looked like a PDA, people expected it to function like one, and were frustrated that it did not have the regular applications.
Manohar says that the Simputer concept needed redefining. What he learned from the initial Simputer launches is that "the under-privileged want to have the same technologies the privileged have, not some cheap stuff that do-gooders provide for them".
The first Simputer was, for power and cost reasons, a monochrome handheld device. "When we launched it everybody was asking why it did not have colours in the era of colour television," he says. "That is when we redefined the [Simputer] to be a world-class product that can serve everyone," says Manohar.
Deshpande and Manohar are now the chief executive officers of Encore and PicoPeta, the two companies that have licensed the Simputer platform.
They say that the evolutionary routes that Simputer took after its initial launch were in response to market realities.
PicoPeta advanced the original Simputer platform into a handheld with features comparable to those in regular PDAs. Meanwhile, Encore retained a version of the Simputer similar to the original one and used it as a basis for more machines, including Mobilis, a tablet-PC-like handheld with a seven-inch display and support for applications such as word processing and spreadsheets.
Media blessings and curses
After Simputer failed to live up to expectations, Negroponte's US$100 laptop rapidly became an international media darling, portrayed by most as the final word on how to bridge the digital divide.
And it is probably thanks, at least in part, to this favourable coverage that six countries -- Argentina, Brazil, China, Egypt, Nigeria and Thailand -- have each pledged to buy one million units, even before putting their hands on the final product or knowing its exact specifications.
India had also shown interest but this month pulled out. Education secretary Sudeep Banerjee said the laptops could be "detrimental to the growth of creative and analytical abilities of the child" and that the money would be better spent on more classrooms and teachers.
The OLPC project is no stranger to criticism. The huge visibility of the Negroponte's machine brought it under fire from IT and economic development experts who believe its potential -- and that of any other low-cost computing device -- may have been overestimated.
"Since the field is so new, nobody really knows an answer to the question 'What is the role that technology will play in developing communities?'," says Mary Bernardine Dias, director of TechBridgeWorld, a programme initiated at Carnegie Mellon University, United States, that aims to put advanced technologies to the service of poor communities.
Dias believes that the excitement over the latest initiatives does more harm than good. "Hype builds expectations, and in many ways fixes the expected outcome of a project before it is launched," she says. "We all need to be flexible when we launch these projects and [should] expect the unexpected."
"I have not seen any of the current projects addressing all of the lessons learned through the past endeavours," says Dias. "Technologies such as the Simputer that were launched as computing for the poor did not live up to their hype."
Najat Rochdi, coordinator of Information and Communication Technologies for Development in the Arab Region, a UN Development Programme initiative, believes one lesson learned is that new solutions are not necessarily better.
She cites the 'PC for Every Household' programme adopted in Egypt since 2002. It was a collaboration between the Egyptian government, local banks, local and multinational computer retailers and software manufacturers to provide computers for low-income families at affordable monthly payments.
"I consider this programme a success," says Rochdi, noting that it widened the base of computer ownership without compromising on quality.
Another criticism is that the latest initiatives focus too much on low cost instead of the technology's appropriateness. "Focusing on price alone is a distraction from the essential goal, which should be technologies that meet the actual needs of people in local communities," says Rochdi.
Several initiatives in the past decade introduced computers to schools and public offices with negligible gains in productivity, meaning "you end up paying much more than you saved on the technology," she adds.
She is also concerned about the little attention paid to local languages.
Rochdi believes that affordable computers are necessary, but "content is more important. It takes a generation of children to build content that really helps empower and advance a new kind of citizenship [for generations to come]".
A final reservation against the latest entry-level computing initiatives is that they have anchored the word 'computer' in people's minds to be synonymous with 'technology'.
Rochdi points to the utility of using radio, TV and personal digital audio (MP3) players to share information and educate people. She says policymakers and the public are fixated with the belief that computers and computer-related inventions, like the Internet, are the only drivers of development.
Education first
Naturally, the proponents of the latest inexpensive computing devices rebuff these criticisms. The OPLC project's director for the Middle East and Africa, Khaled Hassounah says, "Knowledge generally and education specifically have always been key factors in empowering people. Computers could act as great agents for learning, enabling children to interact with concepts in ways that their environment and traditional educational tools did not allow them before."
On the issue of cost versus appropriateness, Hassounah says OLPC is about "education first and technology second", stressing that the aim is not to build a cheap laptop, but one suitable for children to learn with in an environment that traditional computers were not designed for.
"If any manufacturer starts offering a laptop at continually declining prices and with features that solve rural and school-environment use challenges, we will switch to their laptops," he says.
Intel also underlines the educational quality of its products. "The objective is to provide affordable, collaborative learning environments for teachers and young students," says spokesperson Mike Green.
The upgrade cycle
While the debate over the relevance of low-cost computing for the poor goes on, the producers of the different models remain at odds over the relative merits of their machines.
The strongest criticism of the OLPC comes from Manohar of PicoPeta who says: "marketing is far ahead of the product. I will even classify this as a scam".
Manohar used his blog site to outline what he considers the project's blind spots, describing Negroponte as a "marketing juggernaut" and the countries that have promised to buy the one-million laptop batches as "gullible".
Hassounah counters that, saying, "it is always easier to attack the messenger than to actually listen to the message". He says Manohar's criticisms are "wrong or inaccurate at best".
But on one point the two agree. The Simputer inventors tried to address a dominant phenomenon in the PC industry -- Wintel architecture. Wintel is short for Windows-Intel, a reference to machines or systems that use Microsoft's operating system along with Intel's processors.
"With the exception of the OLPC, all the latest initiatives are based on the Wintel architecture, which is not designed to work in developing economies," says Deshpande.
Microsoft's software, he explains, needs frequent upgrades. The newer versions may not run on old processors, so you have to upgrade the computer's hardware all the time. Eventually, he says, you will be forced to replace your PC even if it is still good enough because there is no technical support or spare parts available for older models.
The upgrade cycle is not the Simputer inventors' only criticism of Wintel architecture.
"It is a power guzzler," says Deshpande, pointing out that in most of the developing world, where power is either unavailable or unreliable, the Wintel-based machines will not operate effectively. "Today, a four GHz Wintel-based machine consumes anywhere between 200 to 400 watts, whereas a Simputer needs only eight watts or less."
He argues that the high power consumption and frequent upgrades mean that Wintel-based systems are too expensive for developing nations, even if the computers are provided free through foreign aid. "If you really want to bring costs down you need to take a fresh approach," he says.
In April, eWEEK website reported that Negroponte voiced a similar opinion. "I have come to a conclusion that every new release of software is distinctly worse than the other ... there's a natural tendency to add stuff."
However, Deshpande acknowledges that the microchip industry is now addressing the earlier shortcomings by minimising the processor's power consumption and integrating many functions -- like data processing and connectivity -- into one chip. Which means Simputer's advantages in terms of cost and power could soon disappear.
"We are not dogmatic," Deshpande says. "One to two years down the line, the world will be different, and so will we. We will stick to the concept, not the hardware specifications."
As the debate continues to rage, and companies continue to launch new 'ultimate solutions', Simputer's inventors draw satisfaction from seeing what they have started. "This is a vindication of the Simputer philosophy; that is, you need low-cost information technology for the masses," says Deshpande.:
Document AFNWS00020060731e27v00155
This Day (Nigeria) - AAGM: ZTE Phones, Gateway to Technology Transfer.
Onwuka Nzeshi

547 words

27 July 2006

This Day (Nigeria)

AIWTHD

English

The Financial Times Limited. Asia Africa Intelligence Wire. All material subject to copyright. This Day (Nigeria) (c) 2006 All rights reserved
Leading global provider of network solutions and telecommunications equipment, ZTE Corporation of China says its handset manufacturing plant in Abuja is a demonstration of its commitment towards the production of phone handsets and accessories in Nigeria and a vehicle of technology acquisition and transfer of expertise to Nigerians.
It's local subsidiary, ZTE Nigeria Limited has in the last one year, employed over 100 Nigerians, ranging from telecom engineers, administrative and financial staff as well as establishing territorial offices in Lagos, Ibadan, Port Harcourt, Kaduna, Bauchi, Jos, and Maiduguri.
The multi-million-dollar factory was established shortly after President Olusegun Obasanjo and the Minister of Communications, Chief Cornelius Adebayo visited The Peoples Republic of China, the home base of ZTE Corporation. During the visit, Obasanjo was said to have made a strong case for the Chinese firm not to keep Nigeria as a mere trading partner and consumer of its products, but a land where it could make some capital investments that will be mutually beneficial to both countries. The establishment of the factory has been hailed as a giant stride in the quest by Nigeria to evolve a truly made in Nigeria phone handset.
Marketing Manager, ZTE Nigeria Limited, Mr. Qian Yefa disclosed that the hand set manufacturing factory currently produces 1,000 handsets daily and has about 50 Nigerians in its employ, a situation that will likely improve in due course. He debunked allegations that the company's products made in Nigeria were of lower quality than those made by ZTE in China. Qian also dissociated the firm from any act of dishonesty in its dealings with its Nigerian employees, local contractors and the government, adding that its operations were guided by the principles of transparency and utmost good faith. He dismissed the alleged breach of contract leveled against ZTE by a local contracting firm as an outright falsehood and misrepresentation of facts, stressing those campaigns of calumny cannot stand against a leading world-class enterprise.
"This is a good start on the race to technology acquisition for Nigerian. ZTE will and has created job opportunities to boost the country's chances of acquiring the high technology involved in the manufacture of various telecommunication hardware and accessories partly to be sourced locally.
We are the pioneer of China's telecommunications equipment manufacturing industry, and a comprehensive provider of telecommunications equipment, mobile terminals and services.
"Mobile phones are the extension of our operations. As at the moment, we are the only Chinese mobile phone manufacturer that provides products of the three systems, namely GSM, CDMA and PHS and ZTE has independent intellectual properties to all the core software, hardware circuits, core chips and overall design and integration," he said.
With its range of products like WCDMA, CDMA, NGN, GSM, switching, access, and optical transmission maintaining presence in over 100 countries and regions, the global market is becoming ZTE's most important strategic market. It is China's largest listed telecom equipment manufacturer with shares publicly traded on both Hong Kong Stock Exchange and Shenzhen Stock Exchange. It was the only Chinese IT and telecom manufacturer listed in Business Week's 2005 Top 100 Information Technology Companies.
Distributed by AllAfrica Global Media. (allafrica.com)
FTDL50439400
Document AIWTHD0020060728e27r0000i

ZTE Phones, Gateway to Technology Transfer
by Onwuka Nzeshi

548 words

27 July 2006

07:26 AM

All Africa

AFNWS

English

(c) 2006 AllAfrica, All Rights Reserved
Abuja, Jul 27, 2006 (This Day/All Africa Global Media via COMTEX) --
Leading global provider of network solutions and telecommunications equipment, ZTE Corporation of China says its handset manufacturing plant in Abuja is a demonstration of its commitment towards the production of phone handsets and accessories in Nigeria and a vehicle of technology acquisition and transfer of expertise to Nigerians.
It's local subsidiary, ZTE Nigeria Limited has in the last one year, employed over 100 Nigerians, ranging from telecom engineers, administrative and financial staff as well as establishing territorial offices in Lagos, Ibadan, Port Harcourt, Kaduna, Bauchi, Jos, and Maiduguri.
The multi-million-dollar factory was established shortly after President Olusegun Obasanjo and the Minister of Communications, Chief Cornelius Adebayo visited The Peoples Republic of China, the home base of ZTE Corporation. During the visit, Obasanjo was said to have made a strong case for the Chinese firm not to keep Nigeria as a mere trading partner and consumer of its products, but a land where it could make some capital investments that will be mutually beneficial to both countries. The establishment of the factory has been hailed as a giant stride in the quest by Nigeria to evolve a truly made in Nigeria phone handset.
Marketing Manager, ZTE Nigeria Limited, Mr. Qian Yefa disclosed that the hand set manufacturing factory currently produces 1,000 handsets daily and has about 50 Nigerians in its employ, a situation that will likely improve in due course. He debunked allegations that the company's products made in Nigeria were of lower quality than those made by ZTE in China. Qian also dissociated the firm from any act of dishonesty in its dealings with its Nigerian employees, local contractors and the government, adding that its operations were guided by the principles of transparency and utmost good faith. He dismissed the alleged breach of contract leveled against ZTE by a local contracting firm as an outright falsehood and misrepresentation of facts, stressing those campaigns of calumny cannot stand against a leading world-class enterprise.
"This is a good start on the race to technology acquisition for Nigerian. ZTE will and has created job opportunities to boost the country's chances of acquiring the high technology involved in the manufacture of various telecommunication hardware and accessories partly to be sourced locally.
We are the pioneer of China's telecommunications equipment manufacturing industry, and a comprehensive provider of telecommunications equipment, mobile terminals and services.
"Mobile phones are the extension of our operations. As at the moment, we are the only Chinese mobile phone manufacturer that provides products of the three systems, namely GSM, CDMA and PHS and ZTE has independent intellectual properties to all the core software, hardware circuits, core chips and overall design and integration," he said.
With its range of products like WCDMA, CDMA, NGN, GSM, switching, access, and optical transmission maintaining presence in over 100 countries and regions, the global market is becoming ZTE's most important strategic market. It is China's largest listed telecom equipment manufacturer with shares publicly traded on both Hong Kong Stock Exchange and Shenzhen Stock Exchange. It was the only Chinese IT and telecom manufacturer listed in Business Week's 2005 Top 100 Information Technology Companies.
Document AFNWS00020060727e27r000ah
BG GROUP plc - Q2 2006 Results
11,063 words

24 July 2006

02:00 AM

Regulatory News Service

RNS

English

(c) 2006
RNS Number:5992G BG GROUP plc 24 July 2006
BG GROUP PLC
2006 SECOND QUARTER AND HALF YEAR RESULTS --------------------------------------------------------------------------------
BG Group's Chief Executive, Frank Chapman said:
"BG Group has delivered another strong performance. Operating profit for the half year is up 75%, driven by outstanding growth in E&P volumes and contracted LNG supply, together with higher realisations. We continued to add to our exploration portfolio, and made good progress on key projects keeping our growth programme on track."
HIGHLIGHTS

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

Second Quarter Half Year

2006 2005(i) Business Performance(ii) 2006 2005(i)

?m ?m ?m ?m

1 754 1 133 +55% Revenue and other operating 3 726 2 227 +67%

income

752 493 +53% Total operating profit including 1 710 978 +75%

share of pre-tax operating

results from joint ventures and

associates

401 275 +46% Earnings for the period 926 544 +70%

(76) - - Prior period taxation(iii) (38) - -

325 275 +18% Earnings after prior period 888 544 +63%

taxation

9.3p 7.8p +19% Earnings per share 25.3p 15.4p +64%

3.00p 1.91p +57% Interim dividend per share 3.00p 1.91p +57%

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

Total results for the period

(including disposals and

re-measurements)

1 839 1 013 +82% Revenue and other operating 3 835 2 069 +85%

income

773 733 +5% Operating profit before share of 1 685 1 141 +48%

results from joint ventures and

associates

829 789 +5% Total operating profit including 1 811 1 249 +45%

share of pre-tax operating

results from joint ventures and

associates

435 484 -10% Earnings for the period 973 743 +31%

(17) - - Prior period taxation(iv) 23 - -

418 484 -14% Earnings after prior period 996 743 +34%

taxation

12.0p 13.7p -12% Earnings per share 28.4p 21.0p +35%

-----------------------------------------------------------------------------------
For notes i) to iv) see footnotes on page 2

BG Group plc 1

PERFORMANCE HIGHLIGHTS
?Total operating profit for the second quarter increased 53% to ?752

million. This excludes an additional ?30 million operating profit that has

been secured by selling forward LNG held in inventory for delivery in the

winter.

?Operating profit for the half year rose 75%.

?At constant US$/UK? exchange rates and upstream prices, total operating

profit for the quarter increased by 14%.

?The second quarter included a prior period tax charge of ?76 million

relating to the increase in North Sea taxation.

?Excluding the prior period tax charge, second quarter earnings increased

by 46% to ?126 million.

?The Group has stepped up investment in its exploration programme and this

is reflected in the ?55 million exploration charge for the quarter.

?Dividend increased by 57% to 3p.

?Atlantic/Cromarty (UK) and Dolphin Deep (Trinidad) came onstream.

?Lake Charles second expansion completed.

?In the North Sea, Buzzard platform top sides installed and on schedule to

start production in fourth quarter 2006.

?In Kazakhstan, progress has been made to sanction both the fourth liquids

stabilisation train and the major Phase III development at Karachaganak.

?In Egypt, Rosetta Phase III and West Delta Deep Marine Phase IV were

sanctioned.

?Exploration acreage acquired in Alaska, China, Madagascar and Nigeria.

?Further exploration success in Egypt and the UK.
i) 2005 comparatives have been restated on the application of IFRIC 4

and amendments to IAS 39. See Note 1, page 22.

ii) 'Business Performance' excludes disposals and certain re-measurements


as exclusion of these items provides a clear and consistent presentation of the underlying operating performance of the Group's ongoing business. For further explanation of Business Performance and the presentation of results from joint ventures and associates, see Presentation of Non-GAAP measures, page 12 and Results Presentation, page 3. Unless otherwise stated, the results discussed in this release relate to BG Group's Business Performance.
iii) Prior period taxation is as a result of the increase in North Sea taxation and includes a
?38 million charge to increase the effective tax rate for the first quarter to 44%, and an additional charge of ?38 million in respect of the restatement of deferred tax balances at 1January 2006.
iv) In addition to (iii) above, prior period taxation includes a ?59 million credit relating to the impact of the increase in North Sea taxation on re-measurement balances.
BG Group plc 2
RESULTS PRESENTATION
The presentation of BG Group's results under IFRS separately identifies the effect of:
? The re-measurement of certain financial instruments. ? Profits and losses on the disposal and associated impairment of non-current assets and businesses.
These items are excluded from Business Performance in order to provide readers with a clear and consistent presentation of the underlying operating performance of the Group's ongoing businesses.
Under IFRS the results of joint ventures and associates are presented net of finance costs and tax (see pages 14 and 15). Given the relevance of these businesses within BG Group, the results of joint ventures and associates are presented both before interest and tax, and after tax. The pre-interest and tax result is included in Business Performance discussed on pages 4 to 11. The table below sets out the amounts related to joint ventures and associates, re-measurements under IAS 39 and profits on disposal and impairment of non-current assets and businesses.
--------------------------------------------------------------------------------

Second Quarter Business Disposals and Total

Performance re-measurements Result

(i)

2006 2005 2006 2005 2006 2005

?m ?m ?m ?m ?m ?m

Operating profit 696 437 85 (120) 781 317

before

disposal of

non-current assets

Profits and losses on - - (8) 416 (8) 416

disposal

of non-current assets

(ii)

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

Operating profit 696 437 77 296 773 733

before share

of results from joint

ventures

and associates

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

Pre-tax share of 56 56 - - 56 56

operating

results of joint

ventures and

associates

Total operating profit 752 493 77 296 829 789

Net finance costs