HUL Second Quarter Results: Net Profit Increases 9% YoY, Estimate is Wrong; co to pay Rs 15 dividend

MUMBAI: Major FMCG Hindustan Unilever () today announced a 9% increase in year-on-year net profit to Rs 2,187 crore, which was slightly lower than analysts’ expectations of Rs 2,217 crore.

The shampoo soap maker reported 11.2% year-on-year growth in operating revenue to Rs 12,724 crore for the reported quarter, which was in line with Street’s expectations.

The company’s board of directors also approved an interim dividend of Rs 15 per share following its board meeting today.

HUL’s home consumption growth in the quarter was 11% year-on-year. Performance was diversified, with all three divisions experiencing competitive growth. The company’s fundamentals have remained strong, with more than three-quarters of the company gaining market share and penetration, HUL said in a press release.

“The September quarter was marked by a sequential improvement in trading conditions, although it remained difficult with unprecedented levels of input cost inflation and subdued consumer sentiment,” said Sanjiv Mehta, president and chief executive officer. general of HUL.

High input prices took a heavy toll on the operating performance of the fast-moving consumer goods company in the quarter, as operating margins fell 50 basis points year-on-year to 24.6% . However, operating profit in the quarter managed to grow 9.2% year-on-year to Rs 3,132 crore.

“Our focused actions on managing net income and savings have enabled us to manage inflationary pressures and deliver healthy bottom lines,” HUL said.

HUL’s three product segments have been successful in driving year-over-year growth. The beauty and personal care segment grew 10%, led by skin care, cosmetics and hair care. The soap division managed to grow on a high basis, however, hand hygiene sales fell as the reduction in COVID-19 cases led to a drop in demand for hand sanitizer and hand washing.

Tea has grown on a very solid basis and further strengthened its market leadership, and helped the food segment grow 7% year-on-year, HUL said.

“Looking ahead, we remain cautiously optimistic about the recovery in demand. In these times of uncertainty and unprecedented inflation in input costs, we continue to focus firmly on consistent, competitive, profitable and responsible growth, ”said Mehta.

Shares of Hindustan Unilever rose 2.2% to Rs. 2,710.95 on the National Stock Exchange.

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