HUL net jumps 47% on one-time gains

FMCG major Hindustan Unilever Ltd (HUL) today reported a 47.14 per cent rise in March quarter net profit at Rs 581.20 crore, as against Rs 394.99 crore a year earlier, helped by extraordinary income of Rs 52.11 crore.

Net sales rose 8.2 per cent to Rs 4,315.75 crore from Rs 3,988.33 crore in the year-ago period. The figures were in line with street expectations. One-time gains, including the sale of long-term investments and smaller provisions for retirement benefits, added Rs 143 crore to HUL’s net profit before tax.

Operating profit, meanwhile, declined 1.8 per cent to Rs 545.19 crore from Rs 555.07 crore, due to higher advertising & sales promotion (A&SP) expenditure. A&SP expenditure during the quarter grew 39.05 per cent, still lower than the growth (66 per cent) recorded in the December quarter.

The domestic consumer and FMCG business grew eight per cent, driven by strong volume growth of 11 per cent. Growth in home and personal care and foods was 5.5 per cent and 17 per cent, respectively.

For 2009-10, the domestic consumer business grew 8.6 per cent, while net profit was up 4.1 per cent.

The company’s board proposed a final dividend of Rs 3.50 a share for the year ended March 31, subject to the approval of shareholders. Together with interim dividend of Rs 3 per share, the total dividend for 2009-10 amounts to Rs 6.50 per share, compared to Rs 6 per share in the previous year.

Harish Manwani, chairman of HUL, said: “In an environment of heightened competitive intensity, we have accelerated volume growth, ahead of market. Broad-based actions have been taken to enhance competitiveness of our brands, build new segments, expand offerings in foods and improve the overall quality of our innovations and speed to market. These initiatives have started to yield positive results.”

“We remain committed to further strengthen our brands through bigger and better innovations and unblinking defense of our strong market leadership positions will continue.”

HUL shares today declined 0.6 per cent to close at Rs 230.10 on the Bombay Stock Exchange.