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HUL says rural demand at par with urban: Key Q4 takeaways

Volumes for the quarter grew 7 per cent. The figure stood at 10 per cent in preceding quarter.

, ETMarkets.com|
May 03, 2019, 06.32 PM IST
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HUL's domestic consumer growth stood at 9 per cent, the company said in a BSE filing.
FMCG major HUL on Friday reported its lowest volume growth in six quarters for the January-March period. The company believes market growth has moderated in the near term given the macroeconomic indicators, while medium-term outlook remains positive.

Net profit increased 13.84 per cent year-on-year during the quarter to Rs 1,538 crore from Rs 1351 crore reported for the same quarter last year.

Revenues grew 8.94 per cent YoY to Rs 9,808 crore from Rs 9,003 crore.

“We have delivered a strong performance for the quarter despite some moderation in rural market growth. Our focus on strengthening the core and leading market development has been consistently delivering good results. We have now grown top line and bottom line for the eighth consecutive year and our 2019 results are a testament to both our strategy and execution. Given the macro-economic indicators, near-term market growth has moderated. However, medium-term outlook stays positive,” said Sanjiv Mehta, Chairman and Managing Director, HUL.

Below are five key takeaways from HUL’s Q4 results:

Volume growth in line
Volumes for the quarter grew 7 per cent, in line with estimates. The figure stood at 10 per cent in the preceding quarter. Domestic consumer growth stood at 9 per cent, the company said in a BSE filing.

Management commentary
Consumer demand is looking intact amid rural demand is now at par with urban, according to HUL. The company said colour cosmetics witnessed a good quarter and Lakme continued to focus on emerging trends. HUL also introduced new formats in the frozen dessert segment ahead of summer. Growth in food and beverages businesses continued in March quarter. The FMCG major witnessed steady progress in redesigning the water purifier segment. Growth was broad-based across all segments. Skin care saw steady progress, the company said.

Dividend for the year
The board recommended a final dividend of Rs 13 for the financial year ended March 31. HUL had earlier paid an interim dividend of Rs 9 per share on November 1 last year. The total dividend for the said period amounts to Rs 22 per equity share.

EBITDA margin improves
Operating profit jumped 13 per cent YoY to Rs 2,321 crore in Q4FY19 from Rs 2,048 crore in the same period last year. Ebitda margin improved by 90 basis points YoY.

FY19 report card
PAT of the company jumped to Rs 6,036 crore in FY19 from Rs 5,237 crore last year. The company’s turnover for FY19 stood at Rs 37,660 crore against Rs 34,619 crore in FY18.
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