Hindustan Unilever Limited · NSE:HINDUNILVR
Hindustan Unilever — Q3 FY2017-18 Earnings Presentation
29 slides from Hindustan Unilever's earnings presentation, Jan 17, 2018
Slide 1: Cover letter to stock exchanges: Investor Presentation
17th January, 2018 Stock Code BSE: 500696 NSE: HINDUNILVR ISIN: INEQ30A01027 BSE Limited, Corporate Relationship Department, 2nd Floor, New Trading Wing, Rotunda Building, P.J. Towers, Dalal Street, Mumbai - 400 001 Dear Sir, Sub: Investor Presentation Hindustan Unilever Limited Unilever House B D S
Slide 2: DQ '17 Results Presentation: 17th January 2018
Hindustan Unilever Limited DQ ‘17 Results Presentation : 17th January 2018 1
Slide 3: Safe Harbor Statement
Safe Harbor Statement This Release / Communication, except for the historical information, may contain statements, including the words or phrases such as ‘expects, anticipates, intends, will, would, undertakes, aims, estimates, contemplates, seeks to, objective, goal, projects, should’ and similar e
Slide 4: Agenda
Agenda 1 Strategy 2 Business Context 3 Current Quarter Performance 4 Nine months results 5 Looking Ahead 3
Slide 5: Clear and compelling strategy
Clear and compelling strategy Strategic Framework Sustainable Living Plan Goals Consistent Growth Competitive Growth Profitable Growth Responsible Growth 4
Slide 6: DQ'17: Market context
DQ’17: Market context Trade conditions are normalizing Gradual improvement in demand Input costs continue to inflate 5
Slide 7: DQ'17: Strong volume-led growth delivered
DQ’17: Strong volume-led growth delivered Comparable* Domestic Consumer Growth 17%; Underlying Volume Growth 11% ▪ Base quarter (DQ’16) impacted by demonetization EBITDA at Rs. 1680 Crores up 24%; Comparable* margin up 110 bps ▪ Strong savings program sustained; Supports reduction of COGS* ▪ A&P
Slide 8: 'Accounting' impact of GST on HUL results
‘Accounting’ impact of GST on HUL results With effect from 1st July’17 With effect from 1st Oct’17 Net Excise Duty Net Input taxes Fiscal exemption/ refund Excise a cost; Turnover gross of Input tax credit availed partially. Benefit of Indirect tax fiscal exemption PRE GST excise Balance accounted i
Slide 9: 'Accounting' impact of GST on Growth
‘Accounting’ impact of GST on Growth HUL as consolidated in Unilever ^2% includes impact of 6 months *Exports + KCLL Traded Turnover 8
Slide 10: 'Accounting' impact of GST on margins; No impact on absolute EBITDA
‘Accounting’ impact of GST on margins; No impact on absolute EBITDA 350 bps -135 bps -35 bps -70 bps 110 bps Reported Margin Net Excise Duty Fiscal exemption/refund Net Input Taxes Comparable Margin improvement improvement 9
Slide 11: GST 15th November Changes
GST 15™ NOVEMBER CHANGES Hindustan Unilever Limited, 10
Slide 12: Immediate steps taken
Immediate steps taken Objective: Ensure end consumer gets entire benefit from GST rate reduction with least disruption in trade Trade actions and communication New networks Extensive visibility • Modern Trade advised to pass on • MRP reductions/ increase in • In papers and in more than 10 benefits t
Slide 13: GST price reductions taken to pass on benefits
GST price reductions taken to pass on benefits List of key SKUs with MRP reductions/ increase in grammage – published on HUL website Link to the document 12
Slide 14: Transition impact
Transition impact As mentioned, implementation of this change was initiated immediately Due to paucity of time, entire benefit of the 15th November GST rate reductions on some of the pipeline stocks could not be passed on to the end consumers Therefore, an estimated value of Rs. 119 cr. was pr
Slide 15: Broad based volume led growth across segments
Broad based volume led growth across segments ▪ Home Care: Double digit volume growth across categories ▪ Personal Care: Broad based growth across Personal Products and Personal Wash ▪ Refreshment: Sustained robust performance ▪ Foods: Strong growth led by Kissan *Reported Sales growth = Segment Tur
Slide 16: Continued focus on innovations and activations
Continued focus on innovations and activations 15
Slide 17: Progressively building the naturals portfolio
Progressively building the naturals portfolio Within the existing portfolio Building a master brand Building specialist brands 16
Slide 18: Home Care
Home Care Double digit volume growth across categories Fabric Wash: Robust double digit growth across key brands Household Care: Growth led by strong performance in Vim Purifiers: Pureit launches a range of Air purifiers 17
Slide 19: Personal Care
Personal Care Broad based growth across Personal Products & Personal Wash Personal Wash: Robust growth across key brands ▪ Dove & Pears lead category growth Skin Care: Growth driven by strong performance of Fair & Lovely Hair Care: Broad based volume led growth 18
Slide 20: Personal Care: Contd.
Personal Care : Contd. Broad based growth across Personal Products & Personal Wash Colour Cosmetics: Strong growth sustained Oral Care: Activations aid growth Deodorants: Performance led by Axe 19
Slide 21: Refreshment
Refreshment Sustained robust performance Tea: Tea continues to deliver double- digit growth through our WiMI strategy and market development Coffee: Strong performance delivered Ice Cream & Frozen Desserts: Growth momentum continues 20
Slide 22: Foods
Foods Strong growth led by Kissan Kissan: Broad based growth across Ketchups and Jam Knorr: Growth was led by a strong performance in Soups 21
Slide 23: A&P Strategy: Focused and more effective
A&P Strategy: Focused and more effective Content Data & Profiling Brand experiences Strong data repository 22
Slide 24: Strong savings agenda aids YTD margins; Inflationary pressures building up
Strong savings agenda aids YTD margins; Inflationary pressures building up Our Program Integrated in our culture End to end program Enhancing competitiveness Crude Ownership mindset Zero Based Approach Market competitive business model Organisation wide initiative Blue sky thinking Cutting complexit
Slide 25: DQ'17: Results Summary
DQ’17: Results Summary Rs. Crores ▪ Comparable* Domestic Consumer Growth at 17%^ ▪ Other Income up due to dividend income from subsidiary ▪ Exceptional income includes profit on sale of properties in base (Rs. 159 Crores) ▪ Tax amount low due to reversal of tax provisions of previous year *Comparabl
Slide 26: Nine Months Ending 31st December 2017
NINE MONTHS ENDING 31st DECEMBER 2017 25
Slide 27: Nine Months 2017-18: Results Summary
Nine Months 2017-18 : Results Summary Rs. Crores ▪ Comparable* Domestic Consumer Growth at 11%^ ▪ Comparable* EBITDA margin improvement at 150 bps *Comparable basis – Adjusted for accounting impact of GST; See slides 8 and 9 26
Slide 28: Looking ahead
Looking ahead Near term expectations Gradual improvement in demand to sustain Further inflation in input costs Our strategy Continue to remain agile in the face of uncertainty Focus on volume driven growth and improvement in operating margin Consistent, Competitive, Profitable, Responsible
Slide 29: For more information and updates
For more information and updates Visit our website HUL Investor App 28
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