Hindustan Lever Limited - December Quarter 2004 Results
11-02-2005 :
Hindustan Lever Limited (HLL) today announced its results for December Quarter 2004. Laundry category posted 8% value and volume growth backed by growth in all the brands ie Rin, Surf and Wheel. Laundry Market shares continues to grow. Skin achieved sustained growth (+8%) despite a high base and its market shares continued to improve. Shampoo volumes grew in high double digits (+28.8%) for the third consecutive quarter while the value growth lagged due to pricing action. Overall HPC volumes grew by 5% on the back of enhanced brand investments, and sales value grew 3.4%, mainly due to price reductions taken earlier. To build brand equities, advertising spends were stepped up in HPC by 25% compared to last year.
Brooke Bond, accounting for more than 90% of tea sales, grew by 15.5%. The overall Beverages sales growth was lower at 7% due to planned discontinuation of ‘A1’ brand. Brooke Bond has gained 4.5% value market share in the last one year. Bru instant coffee continues to grow well.
In Processed Foods Market shares were improved/held although primary sales declined by 42%. This decline and the consequential impact on results is due to phased trade stock reduction in salt and culinary products, de-focussing of atta in unviable geographies and withdrawal of innovations launched in 2003.
EBIT (profit before interest and income tax) at Rs.430 crores declined 32.0% due to strategic pricing in Laundry and Shampoo, enhanced brand investments and lower results in foods. PBT (Profit Before Tax) at Rs.446 crores and PAT (Profit After Tax) at Rs.357 crores declined by 31.0% and 36.4% respectively. Net Profit after accounting for exceptional items was Rs.334 crores.
Mr.M.S.Banga, Chairman, commented: “Despite continuing intense competition, we have strengthened our leadership position specially in Hair and Laundry. This has been achieved through strategic brand investments backed by innovation and activation. In Beverages our focus on Brooke Bond and Lipton has started delivering results. In Foods we have largely completed our restructuring and the portfolio is now focused for growth.
“FMCG markets have started to revive after two years of decline. This augurs well and in 2005 we will resolutely focus on growing our topline. The rising input costs are a cause for concern though, we are confident of mitigating its impact through aggressive cost savings and judicious price increases,” Mr. Banga added.
DIVIDEND
The Board of Directors at their meeting held on 11th February 2005 has proposed a final dividend of Rs. 2.50 per equity share of Re.1 each subject approval of the shareholders at the annual general meeting. This along with the interim dividend of Rs.2.50 per equity share amounts to a total dividend of Rs5.00 per equity share for the year 2004.
Hindustan Lever Limited (HLL) is India's largest Fast Moving Consumer Goods company, touching the lives of two out of three Indians. HLL’s mission is to “add vitality to life" through its presence in over 20 distinct categories in Home & Personal Care Products and Foods & Beverages. The company meets everyday needs for nutrition, hygiene, and personal care, with brands that help people feel good, look good and get more out of life.
