Colgate-Palmolive Q1 net profit up 58% on exceptional gain
Colgate had one-time gain of Rs 71 crore in April-June, which included sale of its Global Shared Services Organisation. Its volumes in the quarter rose 9 percent, with 11 percent growth in toothpastes.
July 29, 2013 / 18:35 IST
Moneycontrol Bureau
Toothpaste maker Colgate-Palmolive (India) reported a 58 percent year-on-year jump in first quarter net profit at Rs 185 crore, helped by exceptional gains.The company had a one-time gain of Rs 71 crore in the April-June quarter, which included sale of its Global Shared Services Organisation to Colgate Global Business Services, a subsidiary of Colgate-Palmolive Co, USA.Colgate's net sales for the quarter were up 15 percent from a year ago to Rs 845 crore.Analysts on average had expected the company to report a net profit of Rs 133 crore, on revenue of Rs 864 crore, according to a CNBC-TV18 poll. Also Read: Wipro jumps on strong Q2 outlook, analysts say 'buy'The company said volumes grew 9 percent, led by 11 percent growth in toothpastes.The maker of Colgate Max Fresh, Total and Sensitive toothpaste remains the market leader in toothpastes, with a near 56 percent volume market share in Jan-June, up from 54.7 percent in the year ago period.But the higher market share has come at the cost of margins. Its first quarter EBITDA margin came in at 19.2 percent, versus 22.1 percent a year ago.The company is facing tough competition from existing and new players. Hindustan Unilever has become very aggressive in this segment with its Close-Up and Pepsodent brands. Other companies like GlaxoSmithKline too have stepped up their marketing with Sensodyne toothpaste and US-based FMCG giant Procter & Gamble recently launched its Oral-B toothpaste.Colgate too launched the Visible White toothpaste during the quarter.The company has increased its ad-spends to stay ahead of the competition. Its marketing expenses rose 21 percent to Rs 101 crore in April-June. Its total expenses were up 17 percent to Rs 706 crore.Colgate shares closed down 2.5 percent at Rs 1,407.85 on NSE in afternoon trade on Monday. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
