Hindustan Unilever Q2 profit rises 20% to Rs 2,616 crore, volume grows 4%

HUL’s net material inflation (NMI) in the June quarter stood at 20 percent, while it climbed to 22 percent in the September quarter.

FMCG major Hindustan Unilever Ltd (HUL) on October 21 declared a 20 percent year-on-year rise in standalone profit after tax (PAT) at Rs 2,616 crore for the September quarter (Q2FY23). In the corresponding quarter of the previous fiscal, net profit stood at Rs 2,187 crore.

Sequentially, net profit grew 14 percent from Rs 2,289 crore in the June quarter.

Standalone revenue from operations came in at Rs 14,751 crore, an increase of 16 percent from the year-ago period. Earnings before interest, tax, depreciation and amortisation (EBITDA) for the quarter stood at Rs 3,377 crore, growing 8 percent from Rs 3,132 crore in the same quarter last year.

EBITDA margin declined 170 basis points YoY to 22.9 percent. While revenue and profit beat Street estimates, the EBITDA margin was sharply below.

"In H1 2022-23 we have added an incremental turnover of more than Rs 4,000 crore," Sanjiv Mehta, CEO and Managing Director said.

Along with Q2FY23 numbers, HUL's board also declared an interim dividend of Rs 17 per equity share of the face value of Re1 each for the financial year ending 31 March, 2023.

The company reported underlying volume growth of 4 percent, lower than Street's expectation of 5 percent.

"Demand environment remains challenging with inflation impacting consumption. However, with softening in some commodities and monetary/ fiscal measures taken by the government, we are cautiously optimistic in the near term. In this scenario, we will manage our business with agility, and continue to grow our consumer franchise whilst maintaining our margins in a healthy range," Mehta added.

Home Care

Revenue grew 34 percent YoY to Rs 5,143 crore with volumes growing in double-digits. "Both Fabric Wash and Household Care grew in high double-digits with all parts of the portfolio performing well," said the company.

The FMCG major took calibrated price increases across fabric wash and household care portfolios as input costs remain inflated at significantly high levels.

Beauty & Personal Care

Segment revenue grew 11 percent YoY to Rs 5,561 crore driven by outperformance in the premium portfolio. Skin cleansing delivered strong double-digit growth led by Lux, Dove and Pears, the company said.

In Skin Care and Color Cosmetics, the premium portfolio outperformed delivering double-digit growth, and Hair Care further strengthened its market leadership, informed HUL.

Foods & Refreshment

Segment revenue grew 4 percent YoY to Rs 3,755 crore driven by good performance in Foods, Coffee and Ice-cream.

"Ice Cream had another strong quarter with double-digit growth on a very high base led by robust performance across brands and formats. Tea cemented its market leadership and grew volumes in mid-single digits while turnover declined marginally due to price cuts," the company said.