Hindustan Unilever (HINDUNILVR) Q4 1999 earnings summary

Executive summary

• FY1999 net sales rose 7.0% to Rs. 10,142.49 lakh; profit before tax rose 22.8% to Rs. 1,387.94 lakh and net profit after tax rose 32.8% to Rs. 1,069.94 lakh.

• Performance reflected volume-led gains in several consumer businesses, exports growth and strong cash generation, against flat urban markets and intensified competition.

Financial highlights

• Gross turnover increased 6.9% to Rs. 10,917.69 lakh; net turnover increased 7.0% to Rs. 10,142.49 lakh.

• Profit before tax and exceptional items rose 22.8% to Rs. 1,387.94 lakh; profit after tax before exceptional items rose 27.8% to Rs. 1,069.94 lakh.

• Net profit after tax and exceptional items was Rs. 1,069.94 lakh, up 32.8%; 1998 net profit was Rs. 805.71 lakh after exceptional items.

• Exports grew 20%; foreign-exchange surplus for the business and subsidiaries rose 13% to Rs. 936 crore.

Outlook and guidance

• Packet tea growth plans centered on product innovation, aggressive marketing and rural distribution; out-of-home channels were identified as a growth opportunity.

• Ice cream strategy focused on affordable impulse products, sharper brand focus and expanded distribution, supporting expectations of stronger performance in coming years.

• Staple foods priorities included building on rapid gains and upgrading consumers to relevant Kissan Annapurna products; the business was positioned for significant future growth.

• Modern Food operations were to be revamped following acquisition; the acquisition was intended to link bread manufacturing with the wheat-flour business.