GST impacts Colgate's Q3FY18 net sales; PAT grows by 34% yoy
Colgate recorded PAT of Rs 170.65 crore in Q3FY18, rising by 33.50% from Rs 127.82 crore in the corresponding period of the previous year.
FMCG-major Colgate Palmolive (India) Limited surpassed analysts' estimate by witnessing a whopping 34% year-on-year (YoY) increase in profit after tax (PAT) for third quarter ended December 2017 (Q3FY18) period.
Colgate recorded PAT of Rs 170.65 crore in Q3FY18, rising by 33.50% from Rs 127.82 crore in the corresponding period of the previous year.
However, Q3FY18 net profit tumbled by 3.89% compared to net profit of Rs 177.57 crore in the preceding quarter.
Excluding the impact of tax reversal in both periods, net profit of Colgate would have increased by 30% of the previous year, mentioned Colgate.
Net sales of Colgate came in at Rs 1,026.97 crore, which was up by 4.61% from Rs 981.62 crore in Q3FY17, but was down by 4.73% as against Rs 1,077.98 crore in Q2FY18.
A Bloomberg poll of economists expected Colgate net profit and net sales during Q3FY18 at Rs 156 crore and Rs 1,010 crore respectively.
Colgate's sales for the quarter ended December 31, 2017 and September 30, 2017 are net of Goods and Services Tax (GST), however, sales for the quarter ended December 31,2016 and nine months ending December 31, 2016 are gross of excise duty.
In its financial audit, Colgate stated that, excluding the accounting impact of GST implementation, net sales increased by 19% over the previous year.
Issam Bachaalani, Managing Director at Colgate-Palmolive (India) Ltd said, "As the operating environment stabilizes post the implementation of GST, we are pleased to report overall strong results."
EBITDA (operating profit) grew by 32% during the quarter, while gross margin expanded by 150 basis points on adjusted basis.
"Colgate's core competency of delivering innovations based on consumer insights has helped to strengthen naturals portfolio in India with the addition of Colgate Swarna Vedshakti. We have see a strong consumer response to the toothpaste in the geographies where it has been launched," Bachaalani added.
Colgate continues to maintain its leadership position in both the toothpaste and toothbrush categories during Q3FY18, with volume market share at 53.7% and 45.1% respectively.
Overall volume has increased by 12% on yearly basis.
Post Q3FY18 announcement, the share price of the company surged over 1%, and on the BSE, it finished at Rs 1122.80 per piece above Rs 7.80 or 0.70%.
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