Hindustan Unilever (HUL) has missed Street estimates for the quarter ended June 30, 2021 as rising raw material costs hit margins.
The FMCG giant posted a standalone net profit of Rs 2,061 crore against Rs 1,881 crore a year ago — a rise of 9.56 per cent. Analysts were expecting HUL to post a net profit of around Rs 2,200 crore.
During the period, the company reported an underlying volume growth of 9 per cent, which was lower than the 16 per cent growth seen in the preceding three months. In the year-ago period, it had seen a contraction of 7 per cent.
The quarter saw sales coming in at Rs 11,730 crore compared with Rs 10,406 crore in the corresponding previous period — a rise of 12.72 per cent.
However, the company faced inflationary pressures that saw palm oil rates rising to record levels even as tea and crude prices remained firm. This saw its EBITDA (earnings before interest, tax, depreciation and amortisation) falling by 110 basis points to 24 per cent during the quarter.
“The second wave of Covid-19 brought upon us a severe humanitarian crisis… Looking forward, we remain cautiously optimistic about the demand recovery. Our focus firmly remains behind delivering volume led competitive growth and margins in a healthy range,’’ said Sanjiv Mehta, chairman and managing director, HUL.
Unilever view
Unilever on Thursday said the second wave of the pandemic and subsequent restrictions in India impacted its sales in the country.
The operating environment across its markets in H1 (January-June) has seen some improvements, but broadly it remains “volatile”, the company said in its post earning statement for the first half.