During the quarter, HUL said it saw inflation moderating, albeit remaining high YoY
Hindustan Unilever (HUL) on January 19 released its December quarter (Q3FY23) results wherein its standalone net profit increased by 12 percent to Rs 2,505 crore. The company had reported a profit of Rs 2,243 crore in the year-ago period.
The FMCG behemoth's standalone revenue from operations came in at Rs 15,228 crore, up 16 percent against Rs 13,092 crore logged in the corresponding quarter of the previous fiscal.
The numbers beat estimates as according to a poll of brokerages, standalone revenue was expected to come in at Rs 14,904 crore, up 13.8 percent YoY while profit after tax (PAT) was estimated to increase 8.3 percent YoY to Rs 2,481 crore.
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Underlying volume growth of 5 percent in the quarter was in-line with Street's estimate of 4-5 percent.
"Sustaining our strong momentum, we had yet another quarter of solid all-round performance delivering double-digit revenue and earnings growth. Our consistent performance is reflective of our strategic clarity, strength of our brands, excellence in execution, and dynamic financial management," Sanjiv Mehta, CEO and Managing Director, HUL said.
"I am excited about our foray into the fast-evolving ‘Health and Wellbeing’ category through our strategic partnerships with OZiva and Wellbeing Nutrition," Mehta added.
Along with the results, the Board of Directors approved the proposal to enter a new arrangement with Unilever group entities for the provision of technology and trademark licenses to HUL. In the new agreement, the royalty and central services fees will increase from 2.65 percent in FY22 to 3.45 percent of turnover.
"This increase will be effected in a staggered manner over a period of 3 years. This arrangement is subject to appropriate regulatory approvals," the press release added.
During the quarter, HUL said it saw inflation moderating, albeit remaining high YoY. EBITDA margin at 23.6 percent improved 30 basis points versus previous quarters and declined 180 bps YoY. HUL said it continues to manage its business dynamically by driving savings harder across all lines of profit and loss, ensuring the right price-value equation and investing competitively behind our brands.
Segment-wise, Home Care delivered 32 percent revenue growth and double-digit volume growth. Both Fabric Wash and Household Care grew in high double-digits with all parts of the portfolio performing very well.
Beauty & Personal Care grew 10 percent. Skin Cleansing delivered strong double-digit growth with volumes growing in the mid-single digits. Hair Care grew in high single-digit led by strong performance in Clinic Plus.
Foods & Refreshment segment delivered 7 percent growth led by robust performance in Foods, Coffee and Ice-cream.
"Looking forward, we are cautiously optimistic in the near term and believe that the worst of inflation is behind us," said Mehta. "This should aid in a gradual recovery of consumer demand. We remain focused on managing our business with agility, and continue growing our consumer franchise whilst maintaining margins in a healthy range."
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