Hindustan Lever Q4 profits jump 47 per cent
26 May 2010
Hindustan Unilever Ltd, India's largest household products maker, reported a higher than expected 47 per cent rise in quarterly profit, but warned of a short-term impact on profitability due to lower prices.
The company undertook price cuts of 2.5-3 per cent across its product categories due to rising competition and trading down to cheaper products by consumers in January through March.
The unit of Anglo-Dutch Unilever reported net profit of Rs581 crore in its fourth quarter ended 31 March, up from Rs3.95 crore a year earlier. Net sales rose to Rs4,316 crore from Rs3,989 crore.
"Reported earnings have gone up mainly because of high extraordinary gains they had registered in the quarter," Anand Shah, analysts at Angel Broking, told CNBC-TV18.
The group made a one-time gain of Rs91.1 crore on the sale of investments. It also recorded gains of Rs5.47 crore from the sale of properties and Rs5.336 crore through a reduction in provision for retirement benefits.
Hindustan Unilever, whose brands in India include Dove soap, Clinic shampoo, Closeup toothpaste, Surf detergent and Bru coffee, competes with the likes of Procter & Gamble Hygiene & Health Care Ltd and Colgate Palmolive (India) Ltd.
Hindustan Unilever's personal care segment saw 19 per cent growth in the quarter from a year ago due to the launch of new products such as Vaseline Menz in the male grooming market.