InvestorQ : How were the quarterly results of Godrej Consumer Products for Q3?
Dilmini Mercia made post

How were the quarterly results of Godrej Consumer Products for Q3?

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Dawn Cherian answered.
3 months ago
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Godrej Consumer Products witnessed solid top line growth in the quarter but operating profits came under pressure. That was obvious considering the impact of higher operating costs. FMCG companies in India have faced this challenge and Godrej Consumer was no exception. Net profits were higher on account of exceptional gains in the quarter. This is the financial summary of the Godrej Consumer Products numbers.

Godrej Consumer

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income (Rs cr)

₹ 3,302.58

₹ 3,055.42

8.09%

₹ 3,163.65

4.39%

Operating Profit (Rs cr)

₹ 636.22

₹ 659.39

-3.51%

₹ 631.35

0.77%

Net Profit (Rs cr)

₹ 527.60

₹ 502.08

5.08%

₹ 478.89

10.17%

Diluted EPS (Rs)

₹ 5.16

₹ 4.91

₹ 4.68

Operating Margins

19.26%

21.58%

19.96%

Net Margins

15.98%

16.43%

15.14%

First a look at the top line of GCPL. The company reported 8.1% growth in sales at Rs.3,303 crore compared to last year same quarter. There was 3% growth in the home care vertical and a more impressive 12% in the personal care segments. In terms of geographical spread, there was 8% growth in the India business, 12% improvement in the Africa and Middle East business as well as 19% growth in the lucrative Latin American and SAARC business. Pressure was visible in the Indonesia business which fell -2% in the quarter.

Now a look at the operating performance of Godrej Consumer. For Dec-21 quarter, operating profits were lower by -3.51% at Rs.636.22 crore. This was triggered by the consolidated EBITDA trending lower by 2% even as the EBITDA margins weakened by 210 basis points to 21.4% with pressure coming more from the international business EBITDA. Operating margins were lower due to high input and inventory costs as OPM tapered from 21.58% in Dec-20 quarter to 19.26% in Dec-21 quarter. OMP was 70 bps lower QOQ.

Finally, we come to the bottom line. Net profits for the Dec-21 quarter was up 5.08% at Rs.527.60 crore on the back of exceptional gains, despite operating pressures on the back of higher costs. The exceptional gains came from write-back of losses on the BBLUNT deal as well as gains from deferred taxes in the quarter. PAT margins tapered from 16.43% in the Dec-20 quarter to 15.98% in the Dec-21 quarter due to higher base. As of Dec-21, GCPL reported ROE of 18.1% and ROCE at a fairly impressive. 20.5%.

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