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FMCG major Godrej Consumer Products Ltd (GCPL) on Wednesday reported a 16.56 per cent decline in its consolidated net profit at ₹345.12 crore for the first quarter ended June 30, 2022, on account of commodity inflation and upfront marketing investments.
It had posted a net profit of ₹413.66 crore in the April-June quarter a year ago, GCPL said in a regulatory filing.
Sales volume and revenues
The revenue from the sale of products of the Godrej group's FMCG arm was up 8.08 per cent at ₹3,094.31 crore during the quarter, as against ₹2,862.83 crore in the corresponding period last fiscal.
GCPL's total expenses were at ₹2,696.29 crore in Q1/FY 2022-23, up 13.64 per cent from ₹2,372.65 crore in the corresponding quarter a year ago.
"Our overall EBITDA declined by 13 per cent driven by unprecedented global commodity inflation, upfront marketing investments and a weak performance in our Indonesia and Latin America & SAARC businesses," GCPL Managing Director and CEO Sudhir Sitapati said.
GCPL's India revenue was up 11.36 per cent to ₹1,849.41 crore in the April-June quarter, as against ₹1,660.65 crore in the corresponding quarter a year ago.
However, in Q1/2022-23 GCPL's domestic "volume declined by 6 per cent," said an earning statement from GCPL.
Revenue from the Indonesian market was down 8.49 per cent to ₹376.51 crore (₹411.47 crore).
GCPL's revenue from Africa (including Strength of Nature) market was up 12.19 per cent at ₹778.87 crore, as against ₹694.23 crore a year ago.
While, revenue from other markets was down 3.54 per cent to ₹154.05 crore in Q1/FY 2022-23, as against ₹159.72 crore a year ago.
"Our Africa, USA and Middle East business continued its robust growth trajectory, growing at 12 per cent in INR and in constant currency terms. Performance in our Indonesian business was weak, declining by 9 per cent in INR and 12 per cent in constant currency terms," said Sitapati.
Outlook
On outlook, he said with inflationary pressures abating, the company expects a "recovery in consumption and gross margins" alongside continued higher marketing investments.
"We continue to have a healthy balance sheet and our net-debt-to-equity ratio continues to drop. We are on a journey to reduce inventory and wasted cost and are deploying this to drive profitable and sustainable volume growth across our portfolio through category development," said Sitapati.
Shares of Godrej Consumer Products Ltd on Wednesday afternoon were trading at ₹860.80 on BSE, down 0.50 per cent from the previous close.
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