HUL Q3 net dips 22.42%

 FMCG major HUL reported a 22.42 per cent decline in net profit for the third quarter ended December 2015, at Rs 971.4 crore, compared with Rs 1,252.17 crore in the same quarter last fiscal.

Net sales for the company, however, registered a marginal uptick of 3.22 per cent during the quarter at 7,822.86 crore, compared with Rs 7,579.18 crore in the third quarter, last year. During the quarter, turnover grew at 3 per cent with 6 per cent underlying volume growth. The growth in the quarter continued to be impacted by the phasing out of excise duty incentives and price de-growth, as the benefit of lower commodity costs was passed on to consumers, HUL said.

Input costs were benign resulting in a 290 basis points reduction in cost of goods sold. Brand investments were sustained at competitive levels and overall advertising and promotion spend was up by 165 basis points (Rs 160 crore), the company added.

The company reported an exceptional loss of Rs 79.61 crore during the quarter compared with an exceptional profit of Rs 396.58 crore in the comparable period. This included profit on sale of surplus properties worth Rs 36.91 crore, and provision towards restructuring and select contested matters of Rs 116.52 crore. Other income for the quarter also stood higher at Rs 139.61 crore compared with Rs 120.07 crore in the third quarter, last year. The other income included interest income, dividend income and net gain on sale of other non-trade current investments aggregating to Rs 94.08 crore and dividend income from trade non-current investments of Rs 45.53 crore.

“We have stepped up investment behind our brands and delivered another quarter of profitable volume-led growth, consistent with our strategic intent. In an environment of moderating growth and benign input costs, we remain focused on innovation and market development to drive volumes competitively whilst improving operating margins,” HUL Chairman Harish Manwani said.