Results for the Quarter ending 31st December 2020

Reported Turnover up 20% and PAT up 19%

A collage of Hindustan Unilever brands such as Horlicks, Vim, Domex, Knorr, Glow & Lovely, Pepsodent, Lifebuoy, Vaseline, Surf excel, Bru, Lakme, Clinic Plus, Sunlight

Hindustan Unilever Limited (HUL) announced its results for the quarter ending 31st December 2020.

Growth in the quarter was competitive and profitable with Reported Turnover Growth of 20% and Profit after tax growth of 19%.

Domestic Consumer Growth (excluding the impact of merger of GSK CH and acquisition of ‘VWash’) grew at 7%. Higher mobility, consumer relevant innovations and investments behind market development are driving business momentum. Our business fundamentals remain strong with 86% of our business gaining penetration. Health, hygiene and nutrition forming c.80% of our portfolio continues to grow in double digits and we have seen significant improvement in discretionary categories.

Home Care:

With increased mobility, Fabric Wash performance in the quarter improved sequentially. Our focus on driving market development has enabled us to grow Liquids and Fabric Sensations segments strongly. Household Care continued its strong performance across segments delivering double-digit growth. We continue to step up innovations and have launched ‘Nature Protect’ a range of multi category hygiene mix powered by plant-based actives. We also entered new demand spaces with launch of ‘Vim Matic Dishwash’, ‘Surf Excel Smart Spray’ and ‘Surf Excel Active Hygiene’ to cater to our consumer’s needs.

Beauty & Personal Care:

Beauty & Personal Care grew 9% with robust performance across categories and strong double-digit growths in Skin Cleansing, Hair Care and Oral Care. Skin Cleansing performance was led by ‘Lifebuoy’ and double-digit growth in the premium segment. Skin Care portfolio growths were led by good demand pick-up in the winter portfolio. Our consumer-focused portfolio interventions in Hair Care are yielding strong results. ‘Close Up’ and ‘Pepsodent’ accelerated as contextual communications drove brand salience. Color Cosmetics performance is improving sequentially. During this quarter, we launched ‘Vaseline Anti-Bacterial Hand Cream’ and a new range of ‘Dove’ body lotions.

Foods & Refreshment:

Foods & Refreshment sustained the high growth momentum growing at 19%. In Tea, all our brands continue to grow in high double-digits and well ahead of the market. Coffee saw launch of ‘Bru Veda’, a new variant, with infusion of ayurvedic ingredients. In Foods, Ketchups and Soups performed strongly growing high double-digits. Our Nutrition business too grew in double-digits^ as business returned to normalcy post restoration of disrupted supply lines. With relaunch as ‘Plus’ range from the house of ‘Horlicks’, we made strategic intervention into the high sciences space of adult nutrition. Ice Creams, Foods Solutions and Vending businesses are improving progressively as out-of-home consumption occasions increase.

Operating margins:

EBITDA margins at 24% remain healthy. Profit after tax at Rs. 1,921 Crores increased by 19%, Profit after tax (bei**) at Rs. 1,951 Crores was up 15%. We have significantly dialed up investments behind our portfolio and in building future-fit capabilities. Net revenue management and savings agenda has enabled us drive healthy bottom line.

Sanjiv Mehta, Chairman and Managing Director commented: “With COVID cases coming down sharply and increasing mobility, economic activity in the country continues to improve. The rapid rollout of vaccines will give further impetus to economic growth. Our consumer relevant innovations, market development and execution excellence have enabled us to drive broad based growth across our categories in the December quarter. I am particularly pleased with the performance of our Nutrition business and with the recovery in the discretionary segments of our portfolio; these are structurally attractive and offer immense growth potential. The near-term demand outlook is improving, and we expect to see revival in urban while rural should continue to do well. Inflationary pressures are building up in select commodities and we will manage them judiciously. I am confident that we are very well positioned to capture the growth opportunities and accelerate momentum. “

*As per Kantar Worldpanel for L3M November’20, penetration gains are on relative basis. ^ For domestic business on sales reported by GSK CH for DQ’19. **Before exceptional items

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