Marico, the fast moving consumer goods (FMCG) major, reported a 19 per cent rise in its consolidated net profit at Rs.185 crore for the quarter ended June 2014. Income from operations rose 25 per cent to Rs.1,623.1 crore.
Marico’s consolidated operating profit grew 20 per cent to Rs.267 crore, operating margin was at 16.4 per cent and there was an underlying volume growth of 5 per cent in its business. Its domestic business grew 28 per cent while international business grew 16 per cent during the quarter.
While Marico’s domestic business saw operating margin of 18.8 per cent, a statement from Marico said it believed “an operating margin for the domestic business in the band of 17-18 per cent is sustainable in the medium-term.” It registered market share gains in more than 80 per cent of its portfolio although gross margins contracted due to sharp rise in raw material prices. The company said the average market prices of copra (a key input for its leading brand Parachute oil) during the quarter were up 131 per cent. “Copra being in off-season from now onwards, prices are likely to be range bound for the next quarter,” it said.
In its international business, most core markets registered gains with Bangladesh growing 14 per cent, Middle East North Africa (MENA) growing 18 per cent, South Africa 9 per cent though Vietnam remained flat.
In a presentation, Marico said that over the medium-term, it planned to double its top-line in four years and gain a leadership position in terms of market share. Its portfolio in emerging markets of Asia and Africa would focus on hair and skin nourishment and male grooming.
In terms of regional play, it said in India and Vietnam, the focus would be on food and wellness and in sub-Saharan and South Africa on ethnic hair care. On the Bombay Stock Exchange, Marico stock moved down by 1.7 per cent to close at Rs.256.6 on Monday.
