The company has had to contend with higher expenditure that grew considerably. Raw material expenses (net of stocks) jumped 60 per cent to Rs 59 crore while staff costs increased at a relatively slower pace at 15 per cent to Rs 23.5 crore.
This rise in expenses was cushioned by 11 per cent fall in advertising and publicity expenses to Rs 36.9 crore and nearly a seven per cent fall in purchase of finished goods to Rs 91.6 crore.
Yet, the company was able to show a 25 per cent growth in profit after tax at Rs 37.8 crore. The results for the six-month period ended September 2003 are also in line with those of the latest quarter.
The company announced an interim dividend of 60 per cent for 2003-04 and also an additional share of Dabur Pharma for every two shares of Dabur India, following the approval (on October 17, 2003) to the demerger of the pharma business. The FMCG business, largely comprising of personal care and healthcare products in the hair care, oral care, tonics, digestives and childcare categories, registered a 33.49 per cent growth in net profit which surged to Rs 44.80 crore.
The revenue, during the same period, has grown by 6.35 per cent to Rs 524.12 crore. During the September quarter, the profit for this business grew by 25 per cent to Rs 37.4 crore and accounts for 88.6 per cent of the total. Though the revenue grew at a bit modest rate in the segment to two per cent at Rs 276.6 crore, it accounts for 82.2 per cent of the total.
The pharma business, comprising of allopathic drugs, oncology formulations and bulk drugs, recorded a growth of 21.6 per cent in revenue over the six months to Rs 113 crore, while the net profit grew by 5 per cent to Rs 8.66 crore.
The global growth in oncology segment impacted the topline in pharma business. During the September quarter, this business posted a profit growth of 7.4 per cent to Rs 4.8 crore, while the revenue grew by 23.9 per cent to Rs 60 crore.
The company considers Amla hair oil, Vatika hair oil, Lal Dant Manjan, and Dabur Honey to be the main drivers. The new Red Toothpaste is said to have done well. The company claims to have achieved better cost management resulting in increased operating margins.
The company has also been in expansion mode. It acquired the entire equity holding of Redrock in September 2003, making it a wholly-owned subsidiary of the company. Redrock in turn holds majority stake in Asian Consumercare Pvt Ltd, Bangladesh and controls the composition of board Weikfield International, UAE, making these companies indirect subsidiaries of Dabur India.
The company already has subsidiaries like Dabur Nepal, Dabur Foods, Dabur Egypt, Dabur Overseas and Dabur Finance.