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HUL March Quarter 2010 Financial Results

Double-digit volume growth drives 8% turnover growth in MQ 2010.

  • Double-digit volume growth drives 8% turnover growth in MQ’2010
  • MQ’2010 Net Profit grows 47 % due to exceptional gains; PBT (bei) maintained
  • Full Year Domestic Consumer business grows 9%; Operating Margin up 10 bps; Net Profit up 4% Final Dividend recommended Rs 3.50 per share; full year dividend Rs 6.50,up from Rs 6.00 per share for previous 12 months.

Hindustan Unilever Limited (HUL) announced its results for March Quarter 2010 and financial year ending on 31st March 2010. In the quarter, Domestic Consumer and FMCG business grew 8%, driven by strong 11% volume growth. Growth was broad based across Home and Personal Care (HPC) and Foods and in aggregate, ahead of reported market growth.

HPC business grew 5.5% during the quarter, with strong volume growth in Soaps, Laundry Powders and Personal Products. Amidst heightened competitive intensity in the Laundry category, proactive and decisive actions were implemented and these helped deliver double digit volume growth in both Rin and Wheel powder. Portfolio rejuvenation in Personal Wash category has yielded positive results with robust volume growth in the premium and popular segment.

Personal Products grew 19%,delivering strong volume growth for the fourth successive quarter. All segments including Hair, Oral and Skin care registered robust volume growth. Leadership in Shampoo segment was further strengthened, driven by innovations behind Dove and Clinic Plus; Dove Dandruff therapy was launched.

In Oral, toothpaste growth was ahead of market, with both Pepsodent and Close-up growing double digit. In Skin care, sales growth was well ahead of market with continued focus on market development and expansion into new segments of the future. A significant entry into the male grooming segment was made through the launch of Vaseline Menz. The Facial cleansing portfolio was expanded, driven by multiple variants under Dove, Ponds, Pears and Lakme. Market share improved in the fast growing premium fairness and anti ageing segment.

Foods business grew at 18% largely driven by volume. All segments in Foods viz Tea, Coffee, Processed Foods and Ice creams have grown in double digit. The Tea portfolio now straddles the consumer pyramid with the launch of nutritional tea – Brooke Bond Sehatmand in the mass segment.

Knorr soupy noodles heralded our entry into the attractive noodles market, with a unique offering combining the taste of noodles with the health of soup. Kissan and Annapurna brands continued their strong growth. Ice-cream grew 22% led by strong innovations for the summer season. Swirl’s parlours continue to offer a unique Ice Cream consumption experience with 100 parlours now in operation nationally.

Pure-it continued its strong growth momentum. During the quarter, Pure-it Compact was launched at an attractive price of Rs 1000. This innovation makes Pure-it accessible to a larger group of consumers without any compromise to the standard of water purity.

Superior cost management reduced cost of goods sold by 80 bps, driven by cost savings and buying efficiencies. New innovations, entry into new segments and competitive brand support led to A&P expenditure increasing by 320 bps to 14.5% of sales. PBIT was broadly maintained while PBIT margin was lower. PAT (bei) declined by 7.6% due to higher tax. Net Profits improved by 47.1% due to exceptional gains during the quarter.

In FY 2010, Domestic Consumer business grew 8.6%. PBIT margins have improved by 10 bps, despite A&P investment increasing by 330 bps to 13.6%. Underlying PAT (bei) was up by 3% and Net Profit up by 4.1%.

The Board proposed a final dividend of Rs 3.50 per share for the financial year ending March 31, 2010, subject to approval of the shareholders at the Annual General Meeting. Together with interim dividend of Rs 3.00 per share the total dividend for the financial year ending March 31, 2010 amounts to Rs 6.50 per share compared to Rs 6.00 per share in the previous year, for corresponding 12 months.

Harish Manwani, Chairman commented: "In an environment of heightened competitive intensity we have accelerated volume growth, ahead of market. Broad based actions have been taken to enhance competitiveness of our brands, build new segments, expand offerings in Foods and improve the overall quality of our innovations and speed to market. These initiatives have started to yield positive results.

We remain committed to further strengthen our brands through bigger and better innovations and unblinking defense of our strong market leadership positions."

About Hindustan Unilever Limited

HUL is India's largest Fast Moving Consumer Goods Company, touching the lives of two out of three Indians. HUL’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.

India

Hindustan Unilever Limited
Unilever House,
B. D. Sawant Marg,
Chakala, Andheri (E),
Mumbai - 400 099.
F: +91-22-22871970

T: +91-22-39830000

mediacentre.hul@unilever.com

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