Fast moving consumer goods major Hindustan Unilever Ltd. (HUL) on Tuesday reported a 47 per cent jump in its net profit for the fourth quarter of 2009-10 at Rs.581 crore (Rs.395 crore in the same quarter in the previous year) on the back of a one-time gain due to exceptional income amounting to Rs.143.40 crore.
Q4 profit up
The growth in Q4 net profit came in spite of a modest 8 per cent rise in net sales at Rs.4,316 crore (Rs.3,988 crore) during the quarter. The exceptional income includes sale of properties, sale of long-term trade investments and reduction in provision for retirement benefits arising out of change in actuarial assumptions. The operating profit at Rs.545.19 crore (Rs.555 crore) declined marginally by 1.8 per cent. HUL CFO R. Sridhar said the costs were driven down by improved savings, improved cash flow and better treasury management. New innovations, entry into new segments and competitive brand support led to advertising & promotion (A&P) expenditure increasing by 320 basis points to 14.5 per cent of sales.
During the quarter, the domestic FMCG business grew 8 per cent, driven by a volume growth of 11 per cent. The growth was broad-based across home and personal care (HPC) and foods. HPC business grew 5.5 per cent during the quarter, with strong volume growth in soaps, laundry powders and personal products. Amidst heightened competitive intensity in the laundry category, actions were implemented which helped deliver volume growth.
Personal products grew 19 per cent while the foods business grew 18 per cent largely driven by volume. Pure-it continued its growth and Pure-it Compact was launched at Rs.1,000.
HUL Chairman Harish Manwani said, “In an environment of heightened competitive intensity we have accelerated volume growth, ahead of market. Broad-based actions have been taken to enhance competitiveness of our brands, build new segments, expand offerings in foods and improve the overall quality of our innovations and speed to market. These initiatives have started to yield positive results. We remain committed to further strengthen our brands through bigger and better innovations and unblinking defense of our strong market leadership positions.”
For the full year, on a consolidated basis, the company reported a net profit of Rs.2,157 crore against Rs.2,505 crore in the previous 15 months ended March 31, 2009. Net sales stood at Rs.17,764 crore against Rs.20,501 crore in the previous 15 months. The numbers are not comparable as the previous accounting period related to 15 months ended March 31, 2009.
The board of directors proposed a final dividend of Rs.3.50 per share of Re. 1 each for 2009-10. Together with an interim dividend of Rs.3 per share the total dividend for the year amounts to Rs.6.50 per share.
