HUL Q1 net profit rises 5.7 pc to Rs 1,897 crore; sales up 3.65 pc

With consumer preference constantly changing in the wake of coronavirus pandemic, FMCG major HUL is focusing on e-commerce and modern trade channels,
FMCG major

New Delhi, Jul 21 (PTI)
 FMCG major Hindustan Unilever on Friday reported 5.68 per cent increase in consolidated net profit to Rs 1,897 crore for the first quarter ended June 30.

The company, which had posted a net profit of Rs 1,795 crore in the April-June quarter of the previous fiscal, said three of its manufacturing units in different parts of India are currently shut as some of its workers in these units have tested positive for COVID-19.

Consolidated sales during the quarter under review rises 3.65 per cent to Rs 10,570 crore, as against Rs 10,197 crore in the corresponding period a year ago, Hindustan Unilever Ltd (HUL) said in a regulatory filing.

“In a challenging context of COVID-19 disrupting markets and operations, HUL delivered a resilient performance with reported turnover growth of 4 per cent and Profit after tax and before exceptional items growing by 7 per cent,” the company said in a statement.

The result includes the business of GSKCH India, which was merged into the company on April 1, 2020.

“Domestic consumer growth (excluding impact of merger with GSKCH India) stood at -7 per cent,” HUL said.

HUL’s total expenses rose 5.42 per cent to Rs 8,324 crore in Q1 FY2020-21 as against Rs 7,896 crore.

“Heath, Hygiene and Nutrition constituting 80 per cent of our portfolio delivered healthy mid-single digit domestic consumer growth. The integration of GSK-CH’s nutrition business with us was done seamlessly with good performance on both growth and margins,” it said.

HUL CMD Sanjiv Mehta said, “Our performance in the quarter has been resilient and reflective of the intrinsic strength of our portfolio, agility in operations, excellence in execution, purpose-driven leadership and our strong balance sheet”.

Its revenue from the home care segment during the quarter under review stood at Rs 3,392 crore, down 2.07 per cent. It was Rs 3,464 crore in the year-ago period.

The company’s beauty and personal care segment was down 12.60 per cent to Rs 4,043 crore during April-June period compared to Rs 4,626 crore.

“Performance of skin (care products), color cosmetics and deos being relatively discretionary in nature was impacted severely on account of supply led issues and closure of some of the channels that are extremely relevant for the categories,” the FMCG major said.

However, skin cleansing led by Lifebuoy delivered strong double-digit growth across formats, the company added.

“We have significantly stepped up capacities in both hand wash and hand sanitisers to meet the consumer needs. Lifebuoy is making the ‘good habit of handwashing’ viral with campaigns across platforms,” it said.

Contribution from foods and refreshment segment was up 33.23 per cent at Rs 2,598 crore. It was Rs 1,950 crore in the corresponding quarter last year.

“Riding on the ‘In-home, wellness and immunity’ trends, Foods, Tea and Coffee delivered strong performance with double digit growths,” it added.

Domestic nutrition business performed well, immunity boosting Horlicks with added Zinc was launched in the quarter.

However, “ice creams, foods solutions and our vending businesses which are driven primarily by out of home consumption were massively impacted by the lockdown and closure of restaurants / eateries”, the company noted.

Revenue from ‘other’ segment, which includes exports, infant and feminine care was up 4.32 per cent to Rs 338 crore, compared to Rs 324 crore in the corresponding quarter a year ago.

“While constraints continue due to restrictions in several parts of the country and the near-term demand outlook remains uncertain, we remain well positioned to drive competitive, profitable, and responsible growth. The long-term structural opportunity of FMCG in India also remains intact,” Mehta said the company’s outlook.

Meanwhile, the FMCG firm in a separate filing informed the BSE that its board in a meeting held on Tuesday has declared an interim (special) dividend of Rs. 9.50 per equity share of face value of Re 1 each for the financial year ending March 31, 2021.

The dividend has been declared in pursuance of the order of the NCLT, which had approved the Scheme of Arrangement for transfer of the balance of Rs 2,187.33 crores standing to the credit of General Reserve to the Profit and Loss Account.

Shares of HUL on Tuesday settled at Rs 2,319.10 on the BSE, down 0.48 per cent from previous close.

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