Marico achieved a turnover of Rs 464 crore, an increase of 23% - Q2FY08

Company Brief

New Delhi, October 24, 2007

During Q2FY08, Marico achieved a turnover of Rs 464 crore, an increase of 23% over the corresponding quarter in the previous year. This comprised 16% organic growth accompanied by 7% inorganic growth. Healthy growth across all its businesses, those of consumer products in India, international business and Kaya skin solutions contributed to the overall growth. Together with this topline increase, the bottom­line also recorded a growth of 62 %. Profit After Tax (PAT) during the quarter was at Rs 42 crore as against Rs. 26 crore in Q2FY07. The Board of Marico Limited, at its meeting held on October 24, 2007, declared an interim dividend of 15% on its equity share capital of Rs. 60.9 Crore.

Consumer Products Business – Domestic:

Over the last few years, Marico has focussed on a consistent strategy of growing the coconut oil market by encouraging conversions from loose oil to branded oil. At the same time Parachute has also worked on increasing its market share in pockets where the scope to do so is higher than in its strongholds, through various micro­marketing initiatives. The brand’s market share in the 12 months to August ‘07 was about 48% in volume terms. Saffola continued to build its equity by taking a thought leadership stance through various on­ground activities and communication through multiple media channels during World Heart Day. This campaign won the bronze at this year’s Effie Awards. During Q2FY08, the Saffola franchise grew by 21% in volume over Q2FY07, led by higher growths in Saffola Gold. Mr. Saugata Gupta, CEO Consumer Products Business amplified, “The brand’s strength has also helped it leverage the changes in the environment in India”.

Marico’s hair oil portfolio grew by about 15% in volume terms. Marico has occupied a place in the newer age hair care formats popular amongst the youth through a portfolio of post­wash hair­grooming products. These include Marico’s Silk­n­Shine a post­wash conditioner, Parachute After Shower hair cream and hair gel. These are still nascent segments in the hair grooming category in India and the company intends to establish its presence in these segments that could see an inflection in usage in the future and to play its role in category creation.

International Business:

Marico’s international business turned in a strong performance during the quarter. Aided by Fiancee and HairCode, the brands acquired in Egypt last year, Marico’s International Consumer Products business grew by 73% during the quarter over Q2FY07.

The thrust on expanding the franchise of Parachute hair cream in the Middle East continues. Said Mr. Vijay Subramaniam, CEO – International Business,” The brand’s restage on the platform of nourishment plus protection from harsh water has been launched across the GCC countries. Locally tailored advertising, including an endorsement by regional celebrity, Zainab and other promotional efforts have taken Parachute cream to the leadership position in the UAE”.

Despite some disruption owing to the political uncertainty and floods in Bangladesh, the business performed well with a growth of over 20% as compared to Q2FY07. Parachute coconut oil has increased its market share to 67%. The restage of the soap brands have begun to show results with market share increasing by about 1%.

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