Hindustan Unilever (HINDUNILVR) Q4 2007 earnings summary

Executive summary

• FY2007 turnover grew 13.3%; Home & Personal Care rose 12.3% and Foods 20.2%, with operating margins improving despite elevated input costs.

• Profit after tax before exceptional items increased 14.9% to ₹1,769.06 crore; reported net profit rose 3.8% to ₹1,925.47 crore, reflecting lower net exceptional gains.

Financial highlights

• Net sales, net of excise, were ₹13,717.75 crore versus ₹12,103.39 crore; PBDIT was ₹2,110.52 crore and PBIT ₹1,972.16 crore.

• PBT before exceptional items rose to ₹2,184.53 crore from ₹1,861.68 crore; reported net profit was ₹1,925.47 crore versus ₹1,855.37 crore.

• EPS was ₹8.73 versus ₹8.41; total dividend was ₹9 per share, including interim and Platinum Jubilee dividends and the proposed final dividend.

• Operating cash flow was strong; capital expenditure was ₹372 crore versus ₹151 crore in 2006.

Outlook and guidance

• Plans assume continued Indian economic and market growth; domestic demand was expected to provide resilience despite global recession concerns.

• Cost management, savings and efficiency initiatives will continue, with price corrections considered when needed to protect margins.

• Pureit rollout to additional states was planned for completion in 2008; SAP supply-chain and finance processes were also scheduled for rollout by year-end 2008.

• The next three-year Project Shakti ambition was 500,000 villages and 100,000 entrepreneurs reaching over 600 million rural residents.