GPCL Q1 net profit up 1.72 percent at Rs 132.71 crore

GCPL’s revenues stood at Rs 1,724.91 crore in the reported quarter,up 23.9 per cent from Rs 1,392.11 crore from Q1,FY’13.

“We have seen strong sales growth and margins have also grown well. Our focus on sustaining and extending leadership in core categories has enabled us to grow significantly ahead of the market,” GCPL Chairman Adi Godrej told PTI.

Both India business and international organic business at constant currency were up 19 per cent,he added. “The net profit was affected by higher advertising and publicity spend. Q1 spending is generally the highest in the fiscal and we expect the impact (of the promotional activities) will reflect in the quarters ahead,” GCPL Managing Director Vivek Gambhir said.

On a standalone basis,the company reported 16.46 per cent increase in net profit at Rs 107.08 crore in the first quarter ended June 30,2013 as against Rs 91.94 crore in the year-ago period.

The consolidated advertising and publicity expenses were up by 54 per cent to Rs 239.06 crore in Q1 FY’14 from Rs 155.22 crore in the April-June 2012 quarter.

“Over the last few months,we have launched several exciting innovations along with significant renovations in our portfolio. We are continuing to back these innovations with strong marketing investments,” Gambhir said.

He added that company is confident of getting profit growth in line with the sales growth as the new launches gain scale. GCPL has declared an interim dividend of Re 1 per share for the financial year 2013-14.

The total forex loss for the quarter,including mark to market impact,stood at Rs 15.4 crore on a consolidated level. “Of the 15.4 crore forex loss,Rs 5.4 crore loss is because of the oil buying from abroad. The remaining is a notional,mark to market loss,” Gambhir said.

Asked about the company’s hedging strategy,he said the company has a forex committee that monitors all the exposures and takes calls on it. During the quarter,household insecticides category saw sales growing at more than 24 per cent,while revenues from soaps and hair colours categories increased by 13 per cent and 32 per cent,respectively.

GCPL’s international business grew 30.5 per cent with growth across markets. Indonesia saw 17 per cent growth with sales at Rs 319 crore led by continuous marketing investments,new product launches and distribution expansion. Sales stood at Rs 214 crore in the African region,while for Latin America and Europe,it was at Rs 130 crore and Rs 115 crore,respectively.