HUL revenue, profit dip sequentially in June quarter
India’s largest FMCG company Hindustan Unilever (HUL) reported profit of Rs 2,100 crore in the first quarter of FY 2022, a sequential dip of over 4 percent compared to Rs 2,191 crore in March 2021, according to its stock exchange filing.
The company’s revenue for the quarter ended June fell over 2 percent sequentially to Rs 12,260 crore.
Even with major cities witnessing the second COVID-19 wave in India, the FMCG major recorded a domestic consumer growth of 12 percent from the June quarter last year. This was led by rural demand, the company said in its investor presentation.
The company's revenue was impacted in the first quarter of FY 2022, as the country touched the peak of COVID-19 infections. During the first wave last year, domestic consumer growth had contracted by 7 percent.
Compared to last year when sales were down, the company’s profit in the June 2021 quarter was up 10.7 percent. Its revenue jumped over 12.6 percent over last year owing to the low-base effect.
“All three divisions—home care, beauty and personal care, foods and refreshment—grew competitively and in double-digits,” stated the company in an investor presentation.
“Looking forward, we remain cautiously optimistic about the demand recovery. Our focus firmly remains behind delivering volume-led competitive growth and margins in a healthy range,” said Sanjiv Mehta, Chairman and Managing Director, HUL.
Its sales volume grew 9 percent over the same quarter last year.
The company’s margin shrunk over 180 basis points to 24.36 percent, due to inflationary pressures of rising input costs of crude oil, palm oil and tea. As a result, HUL had raised the prices across fabric wash and household care portfolio during the quarter. Its homecare segment grew by 12 percent compared to the June quarter in FY2021.
Sales across the beauty and personal care segment grew 13 percent, and food and refreshment grew 13 percent over last year.
The consumer goods company is considered a reflection of retail sentiment. While the company has registered stronger growth in the past year, not all segments have recovered to pre-pandemic growth.
For example, HUL's discretionary spending category (skin care, colour cosmetics, and does) was up 39 percent over the quarter ended June 2020, but still 24 percent below the same quarter in June 2019.