Despite inflationary pressures, largely due to currency depreciation, fast moving consumer goods (FMCG) major Hindustan Unilever Limited (HUL) registered a rise of 18 per cent in its net profit for the quarter ended December 31, 2011, at Rs.754 crore (Rs.638 crore). Cost pressures were managed dynamically through aggressive savings programmes coupled with judicious pricing.
Net sales grew 16 per cent to Rs.5,853 crore (Rs.5,027 crore), buoyed by an underlying volume growth of 9 per cent and all segments delivered double digit growth. HUL's operating profit grew 37 per cent while operating profit margin grew by 230 basis points.
Harish Manwani, Chairman, said: “We have delivered another strong quarter of competitive growth with improvement in margins. The results, delivered against a backdrop of an uncertain economic environment, are reflective of the strength of our brands, consistency in our strategy and relentless focus on execution. We will continue to manage our business dynamically to deliver competitive, profitable and sustainable growth.”
While cost of goods sold rose 140 basis points, brand investment continued to be competitive with advertising and promotion spends at 11.8 per cent of turnover. Sales of the home and personal care segment grew 18 per cent, while foods business grew 12 per cent. Soaps and detergents grew 21 per cent while the Laundry segment grew in double digits across all brands. Skin cleansing saw strong double digit growth across segments.
The personal products segment saw broad based volume-led growth of 14 per cent with strong performance in skin and hair. In foods, tea growth was led by the premium portfolio with coffee too witnessing strong growth nationally while packaged foods grew 14 per cent.
“Inflationary pressures were managed through judicious pricing and aggressive drive on cost saving,” HUL Chief Financial Officer R Sridhar told reporters in a teleconference.
