Gillette India (507815) Q4 01/02 earnings summary

Executive summary

• 2002 marked a turnaround focused on financial restructuring, realignment of business activities and functional efficiency, with a return to profitability after a 2001 loss.

• Exiting Geep batteries and discontinuing Duracell exports reshaped the business; 2002 results are not directly comparable with 2001.

Financial highlights

• Net sales, excluding excise duty, were Rs 38,303.59 lakh vs Rs 45,259.97 lakh in 2001; Duracell export discontinuation and Geep divestment affected comparability.

• PBT before exceptional items was Rs 3,129.21 lakh vs Rs 1,870.06 lakh; PBT after Rs 1,384.18 lakh in exceptional expenses was Rs 1,745.03 lakh.

• Net income was Rs 645.71 lakh vs a net loss of Rs 2,778.88 lakh; EPS was Rs 1.98 vs loss per share of Rs 8.53.

• Total expenditure fell 16.7% to Rs 338.75 crore; advertising and sales promotion rose 11% and reached 9% of sales, up 2 percentage points.

Outlook and guidance

• 2003 priorities include profitable sales growth, consolidating 2002 gains and targeting the higher-value end of the double-edge segment to support consumer upgrades to twin-blade and systems products.

• The New Gillette Series premium range and expanded Duracell point-of-sale displays were introduced in early 2003 to support grooming and alkaline-battery growth.

• Directors expected 2003 to provide further impetus to growth, citing strong brands, market share, quality standards and marketing fundamentals.