Hindustan Unilever records 19% increase in profits to beat estimates

INDIA – Mumbai based consumer goods company, Hindustan Unilever Ltd (HUL) has reported 19.17% increase in profit to US$222.9 million in its first quarter ended 30 June 2018, beating estimates.

According to ET Retail, HUL’s EBITDA for the quarter stood at US$328.29m, beating US$319.68 million estimated by ET Now poll, also as compared to US$272.14 million EBITDA in the corresponding quarter last year.

Revenue from operations of the company increased 2.88% YoY to US$1.36 billion in the first quarter FY19 over US$1.32 billion in FY18 during the same time while volume for the quarter rose 12% on year-on-year basis, which was in line with expectations.

The company expects gradual improvement in demand in the near term, Hindustan Unilever said, adding crude oil volatility and currency led inflation are the key risks in the coming months.

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In the quarter, cost of materials was up 16% even though overall expenses dropped slightly from the year-earlier quarter, when the company recorded an excise duty payment of US$100.96 million.

Home and care segment including Surf Excel and Vim brands recorded 3.2% increase in revenue to US$458.36 million.

The company said comparable domestic consumer growth, reflecting accounting impact of GST (excise duty and net input taxes adjusted from sales of base quarter, and GST refunds to the reported sales of current quarter), was 16% during the quarter.

“In the near term, we see gradual improvement in demand and our focus will continue to be on innovations and market development,” said HUL Chairman and Managing Director, Sanjiv Mehta.

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“Crude volatility and currency-led inflation are key risks going ahead and we will continue to manage our business dynamically while driving operational efficiencies.”

He added that the company’s strategic agenda remains one of delivering consistent, competitive, profitable and responsible growth.

During the quarter, HUL combined its foods and refreshments businesses to align with global restructuring of the parent company, Unilever N.V.

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