Jyothy Lab Q1 net dips 45% at Rs 14 cr

FMCG firm Jyothy Laboratories (JLL) today posted a 45.2% decline in its net profit of Rs 14.02 crore for the quarter ended June 30.

The company said the dip in its net profit was due to restructuring of its distribution channel to align with that of its recently acquired FMCG firm Henkel India.

During the quarter under the review, the company had a net sales of Rs 122.99 crore, which is 18.71% down from Rs 151.31 crore sales in the corresponding quarter last fiscal.

"The performance during the quarter has been impacted on account of restructuring of our distribution system from three-level to two-level. The change will have a one-time impact on both the sales and net profit," Jyothy Laboratories Chairman & Managing Director MP Ramachandran said.

"But going forward we expect earnings to improve on account of savings in the channel margin and lift our operating margins by 300 basis points," he said.

At present, JLL holds 72% in Henkel India and is undertaking mandatory open offer for additional 20% shares of Henkel India.

Post-acquisition of Henkel India, JLL now has 10 brands; Ujala, Maxo, Exo, Henko, Mr. White, Chek, Pril, Margo, Fa and Neem.

Shares of Jyothy Lab closed at Rs 197.50 on the BSE, down 4.87% from its previous close.