GCPL Q2 net down 28.36 pc at Rs 413.88 crore

Godrej Consumer Products Ltd (GCPL) on Wednesday reported a 28.36 percent decline in consolidated profit after tax at Rs 413.88 crore for the second quarter ended September 30. The company had posted consolidated profit after tax of Rs 577.73 crore in the same quarter last fiscal, GCPL said in a regulatory filing.

Consolidated sales during the period under review stood at Rs 2,608.15 crore as against Rs 2,643.26 crore in the year-ago period, a decline of 1.33 percent, it added. During the period ended September 30, there has been the sale of certain brands within its entities that will derive benefits of future tax deductions for the group. Consequently, a deferred tax asset amounting to Rs 111.05 crore has been recognized in the consolidated financial results, GCPL said.

Commenting on the performance, GCPL Executive Chairperson Nisaba Godrej said, "We delivered a steady performance in the second quarter of the fiscal year 2020. Our India business delivered robust volume growth of 7 percent, broad-based across categories, amidst a general slowdown in staples consumption".

She further said, "We expect a gradual recovery in the coming quarters for the FMCG industry and also for our business". In value terms, the company said its sales in India grew by 1 percent to Rs 1,490 crore, while volume growth was 7 percent led by new product launches, effective marketing campaigns, and consumer offers.

Household insecticides revenue in India was at Rs 683 crore, soaps at Rs 491 crore, hair color at Rs 160 crore, while other categories stood at Rs 179 crore, it added. "In the fiscal year 2020 we expect steady volume growth in India, supported by our continued focus on innovations and enhancements to our go-to-market model," Godrej said.

GCPL said its international business clocked net sales of Rs 1,144 crore, up 4 percent. "In our international businesses, Indonesia continued its strong performance with double-digit profitable sales growth driven by consistent performance across categories and several go-to-market initiatives," Godrej said.

Africa had a mixed performance with weak sales growth and strong operating profits expansion. Growth was impacted by adverse macroeconomic conditions in West Africa, she added. "We will continue to drive profitable sales growth in Indonesia while focusing on profitability in Africa, and ensuring a meaningful turnaround in our Latin American business," she said.

The company also said its board has declared an interim dividend of Rs 2 per share, 200 percent on shares of the face value of Re 1 each, for the financial year 2019-20.

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