Godrej Consumer’s Second Quarter Profit Grows 44% In-Line With Estimates

Godrej Consumer Products Ltd.’s profit in the July-September quarter grew 44 percent compared to the same period last year.

Net profit increased to Rs 318 crore in the second quarter of financial year 2016-17 from Rs 221.43 crore in the corresponding quarter last year, it said in a filing to the Bombay Stock Exchange. The Bloomberg consensus estimate stood at Rs 333 crore.

Total income for the quarter grew 11 percent to Rs 2,439 crore from Rs 2,197 crore in the same quarter last year. This figure is slightly below the Bloomberg consensus estimate of Rs 2,462 crore.

Earnings before interest, taxes, depreciation and amortization (EBITDA) increased 13.9 percent to Rs 466.48 crore versus Rs 409.71 crore year-on-year. As a result, the EBITDA margin expanded 50 basis points to 19.1 percent from 18.6 percent.

Raw material costs increased by 7.5 percent in the quarter gone by, but its ratio to revenue declined by close to a percent to come in at 36.3 percent year-on-year, aiding the gross revenue margin which expanded by 100 basis point.

Other Key Highlights

• Household insecticides business grew 18 percent to Rs 696 crore.
• Soaps business saw a decline of 10 percent to Rs 377 crore.
• Hair colour business was flat at Rs 177 crore.

Segmental Performance

• The company’s Africa business grew 60 percent to Rs 515 crore.
• Europe business fell 15 percent to Rs 104 crore.
• Latin America business declined 12 percent to Rs 131 crore.
• Overall global sales grew 16 percent to Rs 1,152 crore.

The company expects consumer demand to improve going ahead, Adi Godrej, the chairman of the Godrej Group said in the filing to the exchanges.

Shares of Godrej Consumer Products, fluctuated between gains and losses post the announcement and was trading lower by 0.45 percent at Rs 1,519 as of 12:15 p.m.