Monday, October 29, 2012

HINDUSTAN UNILEVER LTD - (HUL) - NET PROFIT UP 17%; NET SALES UP 12%



HINDUSTAN UNILEVER LTD
Harish Manwani, Chairman & Nitin Paranjpe, MD & CEO

September Quarter 2012
Financial Results

16% Domestic Consumer Sales Growth; PAT (bei) up 23% in  Sep. Quarter 2012.

Hindustan Unilever Limited announced its results for the quarter ending 30th September 2012.
During the quarter, the Domestic Consumer business sustained its robust performance growing at 16% with underlying volume growth of 7%. Overall growth in the quarter was impacted by the budget rationalization in the Canteen Stores Department (CSD).

Soaps & Detergents grew 22%; double digit growth across all segments

Laundry delivered another quarter of strong performance with all brands and formats growing in double digits. The focus on driving upgradation saw both Surf and Rin register double digit volume growth. Comfort fabric conditioners continued to lead market development; the portfolio was expanded with the launch of the One Rinse variant. Household Care also registered double digit growth.
Skin Cleansing sustained its broad based growth momentum. While Dove and Pears are driving category premiumization, Lifebuoy recorded one of its highest growth rates. The liquids portfolio saw accelerated growth led by Lifebuoy Handwash and Lux Bodywash.

Personal Products grew 12%; growth stepped up in Hair & Oral

Hair delivered a strong quarter with broad based growth. During the quarter, the TRESemm√© brand was launched in India with an exciting proposition of ‘salon style hair at home everyday’. The portfolio was further strengthened with the relaunch of Clinic Plus and a new Hair Fall Rescue range under Dove.
Oral Care registered volume led double digit growth with Close Up buoyed by its re-launch in the quarter and Pepsodent driven by the premium range.
In Skin Care, growth was led by Ponds, Vaseline and Dove. The re-launch of Fair & Lovely (FAL) in the previous quarter has been well received.

Beverages grew 10%; led by premium Tea & Coffee

Tea growth was led by the top end while growth in the mass end was revived with the re-launch of Taaza. In Coffee, Bru sustained its growth momentum across both Instant and Roast & Ground (R&G) formats and the premium range was expanded with a new offering – Bru Exotica Guatemala.
Packaged Foods grew 10%; driven by key brands

Knorr soups grew in double digits through focused in-market activation and actions are in place to step up growth in the rest of the portfolio. Kissan Ketchups sustained growth in non-CSD channels andKwality Walls maintained its double digit growth trajectory.
Volatile cost environment; competitive intensity heightens

The operating context remained challenging during the quarter with a volatile cost environment and heightened competitive intensity. Overall industry media spend was up significantly to its highest levels in over 15 quarters. A&P was stepped up and maintained at competitive levels, higher by 118 Crores (+70 bps) in the quarter.
Net Profit After Tax (bei) up 17%

Profit before interest and tax (PBIT) grew by 19% with PBIT margin improving 100 bps. Profit after tax but before exceptional items, PAT (bei), grew to Rs. 806 Crores during the quarter. Net Profit at Rs.807 Crores grew 17%.
The Board of Directors have declared an interim dividend of Rs 4.5 per equity share of face value Re. 1 each, for the year ending 31st March 2013. In addition, an amount of Rs 8 per share has been declared as a Special Dividend to be paid out of the accumulated P&L balance and exceptional income generated in the first half of FY 2012-13 and will be funded from the current cash balances.

Harish Manwani, Chairman commented: “In a volatile and uncertain environment, we continue to sustain our growth momentum while steadily improving our margins. Our consistent performance is being driven by a relentless focus on brand building, bigger and better innovations and disciplined execution in the marketplace.
RESULTS TABLE

Q2FY13
%DIF YoY
Q2 FY12
%Dif QoQ
Q1 FY13
FY 12
  615,541
          12
  551,600
           (2)
  625,015
 2,173,560
1.a. Net Sales
  481,313
          18
  409,267
           (2)
  492,564
 1,697,483
i)  Domestic FMCG - HPC
  106,264
            9
    97,347
           (1)
  106,997
    391,897
ii) Domestic FMCG - Foods
  587,577
          16
  506,614
           (2)
  599,561
 2,089,380
Domestic FMCG - Total (i+ii)
    27,964
         (38)
    44,986
          10
    25,454
      84,180
iii) Others
     15,540
          65
     9,412
          21
    12,862
      38,077
1.b. Other Operating Income
  631,081
         12
  561,012
           (1)
  637,877
 2,211,637
1. Total Income (net) [1.a. + 1.b.]
  539,176
          11
  484,054
           (1)
  546,995
 1,904,328
2. Expenses [sum of (a) to (g)]
  270,084
          18
  229,829
            8
  250,286
    858,489
a) Cost of materials consumed
    82,603
            8
    76,311
            4
    79,713
    302,414
b) Purchases of stock-in-trade
   (25,742)
        389
    (5,263)
       (480)
     6,775
      12,873
c) Changes in inventories of FG, SIT, WIP
    33,049
          15
    28,731
           (1)
    33,286
    110,728
d) Employee benefits expense
     5,769
            1
     5,710
            0
     5,763
      21,825
e) Depreciation
    76,898
          18
    65,137
           (6)
    81,961
    263,478
f)  Advertising & Promotions
    96,515
          15
    83,599
            8
    89,211
    334,521
g) Other expenses
    91,905
          19
    76,958
            1
    90,882
    307,309
3. Profit from operations
      14,875
          83
     8,111
         (32)
    21,861
      27,831
4. Other Income
  106,780
          26
    85,069
           (5)
  112,743
    335,140
5. Profit Before finance costs(3+4)
        633
     1,073
          54
          20
        528
          124
6. Finance costs
  106,147
          25
    85,015
           (5)
  112,215
    335,016
7. Profit after finance costs (5-6)
        158
         (96)
     4,442
       (100)
    60,469
      11,887
8. Exceptional Items - credit (net)
  106,305
          19
    89,457
         (38)
  172,684
    346,903
9. Profit Before Tax (7+8)
   (25,613)
          25
   (20,565)
         (35)
   (39,565)
     (77,763)
10. Tax expense
    80,692
          17
    68,892
         (39)
  133,119
    269,140
11. Net Profit After Tax [9+10]
          -  
          -  
          -  
            -  
12. Extraordinary Items
    80,692
          17
    68,892
         (39)
  133,119
    269,140
13. Net Profit (11+12)


Basic EPS on a Face Value of Rs.1 for Q2 FY 13 stands at Rs.3.73; compared to Rs.3.19 in Q2 FY 12; and Rs. 6.16 in Q1 FY 13. The EOS for FY 12 total was Rs.12.46.

The EPS for the Half Year ended sep,2012 is Rs.9.89 against Rs. 6.09 for the HY ended Sep,2011.

Overall, the performance of HUL for the second quarter ended Serp,2012 is good. While competition is quite intense in all product lines, HUL has been able to improve its sales in all product lines with mostly double digit growth in all of them.

Thus, future also is expected to be quite promising.


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