Hindustan Unilever Q3FY18 net profit rises 28% at Rs 1,326 crore

FMCG-giant Hindustan Unilever Limited (HUL) surpassed analysts' estimate by reporting a whopping 28% rise in standalone net profit for quarter ended December 31, 2017 (Q3FY18).
 
HUL posted a net profit of Rs 1,326 crore in Q3, rising by 27.74% from Rs 1,038 crore, in the corresponding period of the previous year. Q3FY18 net profit also grew by 3.91% as against Rs 1,276 crore in the preceding quarter.
 
A Bloomberg poll of experts projected net profit of Rs 1,170 crore for HUL in Q3FY18.
 
Standalone total income stood at Rs 8,742 crore in Q3, witnessing growth of 4.07% year-on-year (YoY) and 2.69% on quarter-on-quarter (QoQ) basis.
 
Harish Manwani, Chairman of HUL, commented, “We have delivered another strong performance in the quarter, with broad based growth across categories and further improvement in margins."
 
On segment-wise performance in revenue, the home care business contributed 1.93% growth in Q3FY18 to Rs 2,741 crore from Rs 2,689 crore in Q3FY17.
 
On home care, HUL stated that this segment witnessed double digit growth across categories. The laundry saw robust double-digit growth across key brands. Growth in Household Care was led by a strong performance in Vim. The purifiers business saw the launch of air purifiers under the Pureit brand.
 
Meanwhile, personal care business rose by 2.76% to Rs 4,090 crore in Q3FY18, as against Rs 3,980 crore in Q3FY17.
 
Personal wash witnessed robust growth across key brands led by Dove and Pears. Growth in Skin Care was driven by the strong performance of Fair & Lovely, said HUL.
 
Hair Care also witnessed broad based volume led growth. Indulekha brand has now been extended to include Indulekha Bringha shampoo, an ‘Ayurvedic Medicine for Hairfall’. Colour cosmetics delivered yet another quarter of strong growth.
 
On the other hand, refreshment and food business witnessed increase of 7.21% and 7.52% to Rs 1,248 crore and Rs 300 crore in Q3FY18, compared to Rs 1,164 crore and Rs 279 crore a year ago the same period.
 
HUL for food category stated that the Kissan delivered broad based growth across Ketchups & Jams. Knorr growth was led by a strong performance in Soups.
 
As for refreshments, HUL says, "tea continues to deliver double-digit growth. Coffee witnessed a strong performance and the growth momentum continued in Ice Cream and Frozen Desserts."
 
Domestic Consumer Growth was 17% and underlying volume growth was 11% in Q3FY18.
 
While EBITDA (earning before interest tax depreciation and amortisation) margin was up 110 basis points on yearly basis in Q3FY18.
 
Talking on the anti-profiteering news, HUL said, "While the implementation of this change was initiated immediately, it was not possible to pass on the entire benefit of this rate reduction on some of the pipeline stocks during the transition."
 
HUL added, "An estimated value of Rs 119 crores was proactively disclosed to the CBEC on this count and we have offered to pay this amount suo motu to the government. This amount is not recognized as revenue and is accounted as a liability as on 31st December 17."
 
For future growth, Manwani said, "We remain positive about the mid-term outlook of the industry and will continue to invest strongly in our core brands and developing categories of the future. There are early signs of commodity cost inflation and we will further sharpen our focus on cost effectiveness programs and manage our business dynamically for competitiveness and sustained profitability.”
 
On Tuesday, HUL touched a 52-week high of Rs 1,390 per piece on the BSE, however, it ended on a negative note to Rs 1371.85 per piece on the index down Rs 9.45 or 0.68%.