Dabur Q2 net up 19% at Rs 341cr, input costs aid margins

Dabur has posted a steady September quarter with gross margins expanding on benign input costs. The FMCG major's net profit rose 18.8 percent to Rs 341 crore in July-September quarter from Rs 287 crore in corresponding quarter last fiscal. Revenue, during the period, jumped 8.6 percent to Rs 2096 crore from Rs 1930 crore on annual basis.

EBITDA in Q2 was up 15 percent to Rs 404 crore versus Rs 351 crore while EBITDA margins were at 19.3 percent from Rs 18.2 percent year-on-year.

According to a CNBC-TV18 poll, it was expected to report net profit at Rs 329 crore in Q2FY16, up 14.6 percent on a revenue of Rs 2105 crore.“In a low growth and challenging business environment where growth rates in most consumer products segments remained under pressure, Dabur remains committed to delivering profitable growth. Even in these uncertain times, we have continued to report good growth across key categories and grow ahead of the market. We  continue to invest behind our brands and are confident of our ability to report sustainable and profitable growth, going forward,” Sunil Duggal, CEO of the company says

During the period, its gross margins rose 190 basis points at 55.1 percent against 53.2 percent (year-on-year) while raw material costs slipped 5.3 percent at Rs 753 crore. Higher advertising spends partially mitigated margins as ad spends climbed 10 percent at Rs 278 crore (Y-o-Y).

Domestic FMCG volumes grew 5 percent in September quarter. Domestic revenues were up 8.8 percent at Rs 1320 crore while international revenues rose 8.8 percent at Rs 16.9 crore. Turkey and Nepal saw robust growth with good growth in Gulf.

Segment-wise, steady growth was seen in key consumer categories like toothpastes, hair oil and home care. Led by Meswak and Dabur Red, oral care business climbed 19 percent. Hair Oils business saw an over 14 percent growth and home care business grew 12 percent while over-the-counter and ethicals increased 11 percent.The company has declared an interim dividend of 125 percent for 2015-16. “Continuing with payout policy, the board has declared an interim dividend of Rs 1.25 per share, aggregating to a total payout of Rs 264.65 crore,” Anand Burman, Chairman adds.