Godrej Consumer Products Q1 Results FY2023, Net profit at Rs. 345.1 crores

On 3rd August 2022, Godrej Consumer Products announced its quarterly results for the first quarter of FY2023.

Q1FY23 Key Highlights:

- The Consolidated revenue for the quarter was Rs. 3,124.9 Crores, up by 7.96% YoY. 

-  PBT was at Rs. 454.37 Crores, dropped by 16% YoY 

- The net profit for the quarter was Rs. 345.1 Crores, down by 16.59 % YoY

Business Highlights:

- Home Care declined by 4% with a 2-year CAGR of 8%. While Godrej Consumer delivered a soft performance in Household Insecticides, on the back of a high base and relatively muted season, the company continued to deepen penetration and gain market share on a MAT basis. Air Fresheners witnessed a strong performance, led by an uptick in the category.

- Personal Care grew by 25% with a 2-year CAGR of 21%. Personal Wash & Hygiene maintained its growth momentum, delivering double-digit sales growth and a 2-year CAGR in double digits. Hair Colour witnessed strong growth driven by category uptick with a 2-year CAGR in double digits. 

-  Indonesia business delivered a weak performance with a sales decline of 12% in constant currency terms. Sales excluding Hygiene (Saniter) saw a decline of 4% in constant currency terms. 

- In Africa, the USA and Middle East cluster delivered double-digit sales growth of 12% in constant currency terms (3-year CAGR of 11%). The company’s strong sales growth momentum continues in Southern Africa. Its Dry Hair category grew in mid-single digit, while the FMCG category grew in double-digits.

Commenting on the results, Sudhir Sitapati, Managing Director and CEO, GCPL, said: “We delivered a steady performance in 1Q FY 2023. Overall sales grew by 8% with 3-year CAGR in double digits. However, this growth was driven by pricing. We continue to believe that with the relatively non-discretionary, mass pricing of our portfolio and very good performance on market shares, volume growth will return in the medium term. Our overall EBITDA declined by 13% (without one-offs) driven by unprecedented global commodity inflation, upfront marketing investments and a weak performance in our Indonesia and Latin America & SAARC businesses. PAT without exceptional items and one-offs declined by 16%. From a geography perspective, India grew steady at 12%. Our Africa, USA and Middle East business continued its robust growth trajectory, growing at 12% in INR and in constant currency terms. Performance in our Indonesian business was weak, declining by 9% in INR and 12% in constant currency terms. 

From a category perspective, in India, we saw continued momentum in Personal Care, which grew by 25%. Home Care delivered a soft performance and declined by 4%. 

With inflationary pressures abating, we expect 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.

We remain committed to our purpose of bringing the goodness of health and beauty to consumers in emerging markets.”