There was an increase in ad spends by 1.10% QoQ.
Hindustan Unilever (HUL) has announced results for the quarter ended June 30, 2023. It reported an 8% growth in net profit, at Rs 2,472 crore, with underlying sales growth (USG) of 7% and underlying volume growth (UVG) of 3%.
Rohit Jawa, CEO and managing director, HUL, comments, "FMCG markets are recovering gradually, though the operating environment remains challenging. In this context, we have delivered a resilient and competitive performance, whilst stepping up our EBITDA margin."
EBITDA for the quarter, at Rs 3,665 crore, grew by 8%. The EBITDA margin, at 24%, increased by 0.3%.
HUL remains focussed on building back its gross margin and investing competitively in advertising & promotions. The EBITDA margin was up by 0.4% YoY, at 23.6% of sales. PAT, at Rs 2,472 crore, was up 8% YoY.
Sequentially vs March Quarter 2023, the gross margin was up by 1.40%, and advertising & promotions was up by 1.10%.
There was a 13% YoY growth in advertising & promotion expenses, from Rs 1,334 crore in the quarter ended June 2022 to Rs 1,505 crore in the quarter ended June 2023 (first-quarter consolidated results).
Jawa adds, "In the near term, the FMCG industry will continue to witness rebalancing of price-volume growth equations and a gradual recovery in consumer demand. In this environment, we will continue to provide superior value to our consumers and invest behind our brands."
"We remain focussed on driving our long-term strategic priorities, including market development and building distinctive capabilities, for the future. I am confident of the medium to long-term prospects of the FMCG sector, and HUL’s ability to deliver a consistent, competitive, profitable and responsible growth."
Home care delivered another quarter of strong performance, with 10% revenue growth and mid-single digit UVG. Both fabric wash and household care grew in double digits, led by focussed market development actions and premiumisation.
Beauty & personal care delivered 4% revenue growth, with mid-single digit UVG. Skin care and colour cosmetics grew in double digits on the back of strong performance in the premium portfolio. Hair care delivered mid-single digit UVG, led by Tresemme, Indulekha and Clinic Plus.
Skin cleansing had a modest volume-led growth, with Lux and Hamam continuing to outperform. Oral care delivered strong double-digit growth, led by Closeup.
Foods & refreshment revenue grew 5%, with near flat UVG. Tea saw modest volume-led growth, as the category continued to witness consumers downgrading due to higher inflation in premium teas vis-à-vis loose tea.