P&G second quarter net drops 40%

Procter & Gamble Hygiene and Health Care (PGHHCL), the maker of Vicks and Whisper, today said its December quarter net profit fell 40 per cent to Rs 45 crore from Rs 75 crore in the year-ago quarter.

Net sales for the second quarter grew by nine per cent to Rs 298.6 crore from Rs 274.6 crore. The company follows a July-June financial year.

Subsidiary Gillette India was no exception, as net profit slid 46 per cent to Rs 20 crore from Rs 37.5 crore. Net sales rose 26 per cent to Rs 254.5 from Rs 201.7 crore.

Gillette said the fall in net profit was driven by the doubling of advertising and promotion expenditure behind strategic new innovations, which would enable it to continue its future growth.

In PGHHCL’s case, advertising & sales promotion expenditure rose to Rs 57.8 crore from Rs 36.8 crore. Royalty expenditure jumped to Rs 17.3 crore from Rs 15.9 crore, while allied expenditure rose to Rs 42.8 crore from Rs 27.7 crore.

While Gillette shares were down by 1 per cent at Rs 1,741.75, PGHHCL shares fell 0.3 per cent to Rs 1,649.7 on the Bombay Stock Exchange.