Hindustan Unilever Limited · NSE:HINDUNILVR
Hindustan Unilever — Q2 2004 Earnings Presentation
21 slides from Hindustan Unilever's earnings presentation, Jul 29, 2004
Slide 1: JQ'04 Results Highlights
Analysts & Press Meet 29th July 2004 29th July, 2004 JQ’04 Results Highlights 29th July, 2004 1
Slide 2: JQ 2004 Highlights and HPC Market Shares
JQ 2004 Highlights ∙ HPC grows 5% in Volumes - Volume market shares held in Laundry and hair ∙ Foods decline by 9% in Volume impacted largely by planned discontinuation and one-offs ∙ Continuing Sales decline by 2% ∙ Interim dividend maintained at Rs.2.50 per share 29th July, 2004 Market Shares-Valu
Slide 3: Foods Market Shares and EBIT Highlights
Market Shares - Value Foods MQ'04 JQ'04 Pac ket Tea 28.6 28.9 Ins tant Coffee 36.7 40.7 Branded Salt 15.4 15.5 Jams 79.0 79.8 Ketchup 30.7 29.7 29th July, 2004 JQ 2004 Highlights Rs Crores ∙ EBIT decline Rs 175 - One off in JQ’03 26 - Exceptional Items in Foods 15 ∙ Underlying EBIT decline 134 ∙ Mai
Slide 4: Higher Levels of Media Spends essentially in HPC
A&P Increased Brand Building Spends Rs Crores FMCG A&P Spends JQ'04 254 Inc Over JQ'03 60 Growth% 31.8% % Sales 11.6% % Sales Bps 300 Change vs 03 Higher Levels of Media Spends essentially in HPC 29th July, 2004 JQ 2004 Topline Reported Sales (-4.8%) Continuing Discontinued (-1.9%) (-2.9%) FMCG Expo
Slide 5: JQ 2004 Topline
JQ 2004 Topline FMCG Sales (-2.3%) HPC Foods (-0.5%) (-10.0%) 29th July, 2004 JQ 2004 HPC Sales HPC (-0.5%) Soaps & Detergents Personal Products (-3.0%) (+4.7%) 29th July, 2004 5
Slide 6: HPC Topline Highlights
JQ 2004 HPC Topline Highlights Growth Volume Value Personal Wash Laundry Dishwash = Skin Shampoos Toothpaste = Colour Cosmetics 29th July, 2004 JQ 2004 Segment Results Rs Crores Margin JQ'04 JQ '03 BPS Chg Soaps & Detergents 171.2 267.6* (793) • Competitive Pricing actions in laundry •PW Gross Profi
Slide 7: Laundry
Laundry • Volume market shares held despite competitive attack • Q1’04 = 24.5%; Q2’04 = 24.7% • Volume growth 6% ; Sales Decline 5.0% • Actions taken • Price reduction • Additional investment in quality • Higher A & P spends • Brand repositioning • Surf Excel grows volumes • Rin Supreme volume accel
Slide 8: Personal Wash
Personal Wash • Sales grow by 1%+* • Lifebuoy and Lux grow • Pears & Dove grow strongly • Liril & Breeze decline • Portfolio gross profit held * Net of one time credit of Rs 21.3 crs in JQ’03 29th July, 2004 JQ 2004 Segment Results Rs Crores Margin JQ'04 JQ '03 BPS Chg Personal Products 204.6 215.7
Slide 9: Shampoo and Toothpaste
Shampoo • High double digit volume growth 40%+ • Volume market shares held • Q1 = 48.7%; Q2 = 48.6% • Strategic actions to drive growth • Bottle Price Reduction • Value improvement on sachets • Innovative proposition - Clinic Plus “5 in 1” • Driving new price point - Rs 5 bottle • Sales value growth
Slide 10: Skin and Colour Cosmetics
Skin • Sales grow by 11%; Volume Led • FAL continues excellent performance • Innovations launched - FAL Oil Control Gel - FAL Perfect Radiance - Lakme Range 29th July, 2004 Colour Cosmetics •Sustained high performance (+35%) •Innovations in Lakme •Dual Lipstick Lip Liner •Summer Collection Fruit Sho
Slide 11: Foods Sales
JQ 2004 Foods Sales Foods (-10.0%) Beverages Proc Foods Ice Creams (-6.2%) (-15.1%) (-3.2%) 29th July, 2004 JQ 2004 Foods Topline Highlights Growth Volume Value Tea - Brooke Bond/Lipton - Others Coffee = Processed Foods Ice-cream = 29th July, 2004 11
Slide 12: Beverages Segment Results and Tea
JQ 2004 Segment Results Rs Crores Margin JQ'04 JQ '03 BPS Chg Beverages 50.7 54.6 (22) 29th July, 2004 Tea • Brooke Bond grows 2%+ • Lipton doubles led by Out of Home • Planned Discontinuation of ‘A1’ 29th July, 2004 12
Slide 13: Coffee
Coffee • Sales flat • Instant Coffee grows strongly • Bru re-launched • Deluxe Green Label declines; Re-launched as Bru Roast & Ground 29th July, 2004 JQ 2004 Segment Results Rs Crores JQ'04 JQ'03 Processed Foods (27.4) 0.89* * Excluding profit on brand disposal 29th July, 2004 13
Slide 14: Processed Foods
Processed Foods • Sales Decline 15% • Growth in Jams, Ketchups and Soups by 9% offset by – Short season for squashes – De-focus in non-profitable geographies in Atta – Unusually high levels of trade stock returns 29th July, 2004 Processed Foods Results • Impact of lower sales and higher promotional
Slide 15: Ice-cream and Exports Sales
Ice- cream •Volumes maintained through new affordable price points •Sales value decline by 3% •Profit performance sustained 29th July, 2004 JQ 2004 Exports Sales Exports (+3.8%) FMCG Non-FMCG (-5.3%) (+16.1%) 29th July, 2004 15
Slide 16: Exports Results and Results Highlights
JQ 2004 Segment Results Rs Crores JQ'04 JQ'03 Exports 8.9 14.7 • Impact of Rupee movement • Adverse Mix impact 29th July, 2004 JQ 2004 Results Highlights Rs Crores JQ'04 JQ'03 Growth% Sales (Continuing) 2572 2621 (2) PBIT 331 506 (35) Financial Income (Net) 29 68 (57) Int on Bonus Debentures (30) PB
Slide 17: Cash Generation and Dividends
Cash Generation Rs Crores JQ04 JQ03 Business Operation 352 539 WC Reduction 542 349 Treasury income 28 69 Total Cash Generated 922 956 Capex 63 44 Tax paid 72 8 Total Cash Deployed 135 52 Net Cash Generated 787 904 29th July, 2004 Dividends Dividend per share of Re 1 2003 2004 Interim 2.500 2.500 Di
Slide 18: Summary
Summary • Value market shares held/improved in most categories 29th July, 2004 Summary • Value market shares held/improved in most categories • Held Volume market shares in laundry and shampoos albeit at reduced profitability 29th July, 2004 18
Slide 19: Summary
Summary • Value market shares held/improved in most categories • Held Volume market shares in laundry and shampoos albeit at reduced profitability • Underlying EBIT primarily impacted by 8% drop in Soaps & Detergents segment margin 29th July, 2004 Summary • Value market shares held/improved in most
Slide 20: Summary
Summary • Value market shares held/improved in most categories • Held Volume market shares in laundry and shampoos albeit at reduced profitability • Underlying EBIT primarily impacted by 8% drop in Soaps & Detergents segment margin • Normalised margin in laundry to restore over time • Investments ma
Slide 21: Thank You
Thank You 29th July, 2004 21