MUMBAI: The fast moving consumer goods (FMCG) giant, Hindustan Lever Ltd. (HLL), has reported double-digit growth in sales after a gap of six years. The 2005 annual results show a 11.4 per cent growth in total sales at Rs. 11,060.55 crore against Rs. 9,926.95 crore in 2004.

The improved showing has been attributed to broadbased growth across categories with both the home and personal care (HPC) and foods business growing 14 per cent and eight per cent, respectively.

The profit after tax was higher at Rs. 1,354.51 crore against Rs. 1,199.29 crore and the net profit, after exceptional items of Rs. 82 crore, was up at Rs. 1,408.10 crore (Rs. 1,197.36 crore).

Exceptional items comprise largely the profit on transfer of Doom Dooma and TEI plantation divisions to subsidiaries.

The company has proposed a final dividend of Rs. 2.50 per share of Re. 1 each, subject to approval of shareholders at the annual general meeting. This, along with the interim dividend of Rs. 2.50 per share, amounts to a total dividend of Rs. 5 per share for 2005.

Judicious price increases

During the year, there was a substantial increase in the advertising and promotions (A&P) expense at Rs. 985 crore (Rs. 823 crore).

Addressing the media here on Tuesday, Harish Manwani, Chairman, HLL, said, "judicious price increases coupled with robust cost saving initiatives partly neutralised the impact of both cost escalation, particularly in the laundry category, and higher investment behind brands."

"We have sustained the growth momentum in the December quarter and it continues to be broadbased across the HPC and foods categories, particularly in the competitive categories of laundry and shampoo. This was driven by higher investment behind our brands with exciting innovations, excellent activation, new initiatives in customer management and significantly higher level of A&P spends."

Further, according to the Chairman, "our strategic priority remains unchanged.

"We will continue to leverage our focused portfolio of powerful brands to sustain market leadership and grow our market position across strategic brands and categories.

Printer friendly page  
Send this article to Friends by E-Mail