Hindustan Unilever quarterly profit rises 3.7 pct at Rs 7,570 cr

Written by Agencies | Mumbai | Updated: Jul 28 2014, 23:41pm hrs
Hindustan UnileverHindustan Unilever posted a net profit of Rs 1,019.25 crore for the quarter ended June 30.
FMCG major Hindustan Unilever Ltd today reported 3.68 per cent increase in standalone net profit at Rs 1,056.85 crore for the first quarter ended June 30, 2014-15.

It had posted net profit of Rs 1,019.25 crore in the April-June quarter of 2013-14 on account of exceptional gain of Rs 106.25 crore, the company said in a BSE filing.

HUL's net sales climbed to Rs 7,570.78 crore in Q1, 2014-15, from Rs 6687.49 crore a year ago, up 13.20 per cent.

HUL Chairman Harish Manwani said: "We continue to grow ahead of our markets and have delivered another quarter of strong top and bottom-line performance.

"While we are seeing headwinds on market growth, consumer spending and inflation, we remain focused on managing the business for long term competitive and profitable growth and implementing our strategy with even greater rigour."

Overall expenses in Q1 stood at Rs 6,466.52 crore, as against Rs 5,789.88 crore in the year-ago period.

Hindustan Unilever sees no demand recovery though sales improve

(Reuters) India's Hindustan Unilever Ltd (HUL) sees no immediate sign of recovery in demand for consumer goods after a transport strike last year helped sales volume in April-June outgrow estimates for the first time in eight quarters.

HUL has been selling Rin detergent, Fair & Lovely skin cream and Dove soap in an economy witnessing its longest period of sub-5 percent growth in 25 years. Household spending has suffered as high inflation eclipses city salary rises and a recent drought reduces rural income.

The consumer goods sector in Asia's third-largest economy is worth about $13 billion according to analysts, but consumers have been "pessimistic" for 33 months, showed a June survey by ZyFin Research.

"The environment continues to be tough and both volume and value growth metrics are not showing substantial signs of improvement," HUL Chief Financial Officer PB Balaji said in a conference call after the company reported quarterly earnings.

"Discretionary categories continue to be under pressure," he said.

Net profit rose 4 percent to 10.57 billion rupees ($175.9 million) in the fiscal first quarter ended June 30, HUL said in a statement. That compared with the 9.66 billion rupees mean estimate of 11 analysts according to Thomson Reuters StarMine.

Net sales rose 13 percent to 75.7 billion rupees versus the analyst average estimate of 74.3 billion, helped by product relaunches as well as soaps and detergents exceeding analyst forecasts.

Sales volume grew 6 percent from the same period last year when a general strike among transportation workers prevented some goods reaching shop shelves. Analysts had expected growth ranging from 4 percent to 5 percent.

Excluding the impact of the strike, sales volume grew 5 percent.

HUL therefore said sales volume grew on a par with analyst estimates, just days after Anglo-Dutch parent Unilever cited overall slowdown in Asia as a reason for missing second-quarter sales forecasts.

Shares of HUL, which have a market value of $23.9 billion, ended 3.5 percent higher after the earnings release, compared with a 0.5 percent decline in the benchmark index.

HUL shares trade at 34.7 times the company's 12-month forward earnings. That compared with 26.4 times for peer ITC Ltd, 37.1 times for Nestle India Ltd and 29.6 times for Godrej Consumer Products Ltd, showed data from Thomson Reuters.

($1=60.0900 Indian rupees)