Hindustan Unilever’s net profit during the March quarter grew to Rs872.13 crore on low input costs and growth in domestic business

Hindustan Unilever Ltd (HUL), the fast moving consumer goods (FMCG), company reported a 11% higher fourth quarter net profit on lower input costs and growth in its domestic consumer business.

For the quarter to end-March, the FMCG company, a unit of Unilever, said its standalone net profit rose 11% to Rs872.13 crore from Rs787.20 crore, while total revenues, including sales, increased 10% to Rs7,094.10 crore from Rs6,465.81 crore, same period last year.

“Against the backdrop of a challenging environment, we have delivered another year of competitive and profitable growth. We stepped up investment behind our brands and innovations, whilst driving cost savings and operational efficiencies with even greater rigor. Looking ahead, we are confident that our strategy is on track to deliver sustainable long term growth and margin improvement,” Harish Manwani, chairman of HUL said in a statement.

The company said during the quarter, its domestic consumer business grew at 9% with 3% underlying volume growth. “The operating context during the quarter remained challenging with slowing market growth and high competitive intensity. Firm input costs were managed through a mix of judicious pricing and cost savings. Brand investments were sustained at competitive levels with higher advertising spend being offset by lower promotional activities,” HUL added.

Soaps and detergents segment

Skin Cleansing delivered double digit growth, aided by a step up in price growth as judicious pricing actions were taken to manage input cost inflation. Growth was broad based across brands with the liquids portfolio seeing accelerated growth.

In Laundry, growth was led by the premium segment with Surf maintaining its double digit growth momentum and Rin delivering good growth on the bars portfolio. Wheel growth stepped up on the back of its re-launch in the last quarter. Comfort Fabric Conditioners continue to lead market development with sustained high growth. Vim led the performance in Household Care.

Personal products

Skin Care grew well in a soft market. The re-launch of Fair & Lovely, with the new ‘Best Ever Formula’ and supported by a focused activation plan, is yielding positive results. Ponds had a good quarter at the premium end while Lakme and Dove sustained their robust performance. The Facial Cleansing portfolio registered broad based growth driven by innovations launched in previous quarters.

Hair Care sustained volume led double digit growth with Dove delivering another strong performance and Clinic Plus doing well. TRESemmé, which saw the addition of a new Split Remedy variant, continued to make very good progress.

In Oral Care, significant investments were made to sustain our competitiveness in the category. While Close Up grew in the quarter, Pepsodent was impacted by the high promotional intensity in the market. Actions are underway to step up performance.
Colour Cosmetics maintained its strong innovation led growth momentum across both Lakme and Elle 18. Lakme continues to strengthen its position in premium make up driven by a range of exciting and contemporary offerings.

Beverages segment

Tea sustained double digit growth on the back of stepped up volumes. Taj Mahal, Red Label and 3 Roses grew in double digits, driven by a strengthened mix and focused in-market activities. The thrust on leading market development for tea bags saw flavoured and green tea bags more than double sales in the quarter. In Coffee, Bru Gold continued to perform well.

Packaged foods segment

Kissan registered another robust quarter with growth accelerating on both Ketchups and Jams, driven by impactful activation while Knorr growth continued to be led by Instant Soups which more than doubled volumes. Ice Creams saw strong growth arising from the selling in of Magnum which was extended to 4 other cities, and sharper in-market execution on Kwality Walls, ahead of the season.

For the 12 month to end-March, HUL said its net profit increased 1.87% to Rs3,867.49  crore from Rs3,796.67 crore, its total revenues grew 8.56% to Rs28,019.13 crore from Rs25,810.21 crore a year ago period.

HUL has declared a full year final dividend of Rs7.50 per share.

HUL closed Monday flat at Rs580.60 on the BSE, while the 30-share benchmark too ended the day flat at 22,631.

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