The Hindu Business Line : Colgate Palmolive net more than doubles

Mumbai, Oct. 26 Colgate Palmolive has recorded a net profit of Rs 54.7 crore (Rs 23.18 crore) during the second quarter, registering an increase of 136 per cent over the same quarter of the previous year. Its net sales grew at 14 per cent to Rs 363.9 crore during the quarter.

Driving Growth

In line with the market conditions during the half year, the company achieved an overall volume growth of 7 per cent led by a 9 per cent increase in its core toothpaste category, resulting in a market share increase to 49.1 per cent during the January-August period. All major brands — Colgate Dental Cream, Active Salt, Max Fresh and Cibaca — continued to contribute to the strong volume growth.

The toothbrush category also witnessed a steady volume growth in the current half year, increasing its market share to 35.1 per cent.

The company continues to invest in its equity and brand-building activities with the advertising and sales promotion expenditure at Rs 118.8 crore for the half year, an increase of 21 per cent over the same period last year.

The benefits and incentives available from higher production at the toothpaste plant at Baddi has further reduced the effective income tax rate and contributed to the higher Earnings Per Share of Rs 8.50 and net profit from operations for the half year of Rs 116.3 crore, an increase of 34 per cent over the prior year same period.

Dividend

During the quarter, the company paid a special dividend of Rs 2 per share, in commemoration of its completing 70 years. The dividend was declared out of the profits for the year ended March 31.

Reduction of Capital

The company’s proposal for reduction in the face value of the shares from Rs 10 per share to Re 1 per share by payment of the Rs 9 per share uniformly to all shareholders has received confirmation from the Bombay High Court. The proposal had been earlier approved by an overwhelming majority of the shareholders at the Annual General Meeting on July 27. The company intends to implement the proposal and payment to shareholders in December.

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