Hindustan Unilever Limited (HUL) announced its results for the quarter ended 30th June 2024.
June Quarter 2024 Results
HUL delivered a robust performance in JQ’24 with an Underlying Volume Growth[a] (UVG) of 4%. Underlying Sales Growth[b] (USG) was 2% due to the impact of price reductions taken during the year as we passed on benefits of lower commodity prices to consumers. EBITDA margin at 23.8% was up 20 bps YoY. Profit After Tax before exceptional items (PAT bei) and Profit After Tax (PAT) both grew 3% YoY.
Home Care: Strong volume led performance across formats and segments
Home Care delivered a strong performance with 4% USG and high-single digit UVG. Fabric Wash grew volumes in high-single digit led by structural actions taken across the portfolio, in both mass and premium segments. Household Care grew volumes in mid-single digit driven by strong performance in premium dishwash portfolio. We continued to strengthen our core dishwash portfolio by re-launching Vim bar with a superior formulation. Premiumisation journey in fabric wash liquids was further bolstered by the expansion of Rin liquids.
Beauty & Wellbeing: Mid-single digit volume growth led by Hair
Beauty & Wellbeing delivered 3% USG with mid-single digit UVG. Hair Care grew volumes in double-digit driven by a strong performance in Sunsilk, Clinic Plus and Dove. Skin care and Colour cosmetics had a muted volume performance in the quarter driven by decline in mass portfolio. Investments in channels as well as formats of the future and premium portfolio continued to yield healthy results. During the quarter, Dove glycolic hydration range, Vaseline gluta-hya overnight lotion and a range of innovations under Lakme skin and cosmetics capturing new trends were launched.
Personal Care: Resilient performance in Skin Cleansing
Personal Care delivered low-single digit UVG while USG declined by 5%. Skin Cleansing had a low-single digit volume growth but revenue declined on account of pricing actions taken. Bodywash continues to strengthen market leadership. Oral Care delivered mid-single digit growth driven by pricing. During the quarter, Lux and Lifebuoy were re-launched with a superior product formulation.
Foods & Refreshment: Stable performance
Foods & Refreshment had a USG of 1% with volumes remaining stable. The category was impacted by a harsh summer season. Nutrition Drinks (Horlicks & Boost) had subdued performance in the quarter albeit continuing to win competitively. Adult nutrition range performed well. Tea continued to cement its market leadership through value and volume share gains. Coffee delivered double digit growth driven by pricing. Foods grew volumes in low-single digit led by outperformance in Food Solutions, Mayonnaise, Peanut Butter, and International sauces. Ice-cream delivered double-digit volume growth aided by strong launches during the summer season. Bru’s specialty coffee range ‘Southern Trails’, Kwality Walls’ Strawberry Sundae, and Hellman’s 5 in 1 mayonnaise seasoning mix were launched in the quarter.
Stepping up Gross Margins and Investments
EBITDA margin at 23.8% was up by 20 bps versus JQ’23. Gross Margin improved 170 bps and A&P investments increased 90 bps. We continue to focus on building back gross margin through improved price coverage and net productivity measures while stepping up investments behind our brands and future-fit capabilities to win competitively.
Rohit Jawa, CEO and Managing Director commented: ‘HUL’s first quarter performance reflects our decisive actions of transforming our portfolio in high growth spaces aided by gradual recovery of rural markets. Our commitment to unlocking access to aspiration, market making & premiumization supported by our distinctive capabilities is a key driver of our competitive edge.
We continue to focus on driving competitive volume growth, generating fuel to invest behind our brands and making our business future fit. We remain confident of the medium to long term potential of Indian FMCG sector. With our strong brands, execution prowess and distribution might, HUL is well positioned to leverage this growth opportunity as we continue transforming our business to outperform.’