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GCPL Q2 net profit falls 25% to Rs 359 crore, Retail News, ET Retail

 Sudhir Sitapati, MD & CEO, GCPL
Sudhir Sitapati, MD & CEO, GCPL

FMCG major Godrej Consumer Products Ltd (GCPL) on Tuesday reported a decline of 25.06 per cent in its consolidated net profit at Rs 358.86 crore for the second quarter ended September. It had posted a net profit of Rs 478.89 crore in the July-September quarter a year ago, GCPL said in a regulatory filing.

The revenue from the sale of products of the Godrej group’s FMCG arm was up 7 per cent at Rs 3,364.45 crore during the quarter under review, as against Rs 3,143.61 crore in the corresponding period last fiscal.

GCPL’s total expenses were 14.41 per cent up at Rs 2,951.38 crore in the September quarter. It was reported at Rs 2,579.45 crore last year.

“Our overall EBITDA declined by 15 per cent driven by consumption of high cost inventory, upfront marketing investments and a weak performance in our Indonesia and Latin America & SAARC businesses. PAT without exceptional items and one-offs declined by 21 per cent,” GCPL Managing Director and CEO Sudhir Sitapati said.

The company’s India revenue was up 8 per cent to Rs 1,985.03 crore in the September quarter from Rs 1,838.14 crore in the preceding year.

“From a category perspective, in India, we saw continued momentum in Personal Care, which grew by 18 per cent. Home Care grew by 2 per cent,” he said.

Revenue from the Indonesian market was down 8.15 per cent to Rs 408.66 crore, as compared to Rs 444.93 crore in the previous year.

Its revenue from Africa (including Strength of Nature) market was up 15 per cent at Rs 858.66 crore over Rs 748.54 crore.

While, revenue from other markets was up marginally to Rs 174.40 crore in the second quarter of FY 2022-23, as against Rs 172.72 crore earlier.

“Our Africa, the USA and Middle East business continued its robust growth trajectory, growing at 15 per cent in INR and 13 per cent in constant currency terms. Performance in our Indonesian business was weak, declining by 8 per cent in INR and 11 per cent in constant currency terms,” Sitapati said.

With inflationary pressures abating, Sitapati said he expects a recovery in consumption and gross margins alongside continued higher marketing investments with a significant focus on reducing controllable costs.

“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,” he said

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