Hindustan Unilever Limited · NSE:HINDUNILVR
Hindustan Unilever — FY2022 Earnings Presentation
40 slides from Hindustan Unilever's earnings presentation, Apr 27, 2022
Slide 1: Exchange cover letter for investor presentation
27th April, 2022 Stock Code BSE: 500696 NSE: HINDUNILVR ISIN: INE030A01027 BSE Limited, National Stock Exchange of India Ltd Corporate Relationship Department, Exchange Plaza, 5th Floor, 2nd Floor, New Trading Wing, Plot No. C/1, G Block, Rotunda Building, P.J. Towers, Bandra – Kurla Complex, Dalal
Slide 2: Hindustan Unilever Limited MQ'22 Results
Hindustan Unilever Limited MQ’22 Results : 27th April 2022 Sensitivity: Public
Slide 3: Safe harbour statement
Safe harbour 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
Slide 4: Sanjiv Mehta, CEO and Managing Director
Sanjiv Mehta Chief Executive Officer and Managing Director Sensitivity: Public
Slide 5: FY'22: Solid all-round performance in a challenging environment
FY’22 : Solid all-round performance in a challenging environment Turnover Turnover Growth YoY 50,336 cr. 11% Earnings Per Share Market Share Sustainability 11% >75% 116K tonnes YoY Growth Business winning shares Plastic waste collected and disposed Plastic Neutral in 2021 Business Winning Shares : A
Slide 6: We are building a stronger business
We are building a stronger business 1 2 3 4 5 WINNING WITH EXCELLENT STRENGTHENING DIGITAL LEADING OUR PORTFOLIO EXECUTION COMPETITIVENESS TRANSFORMATION SUSTAINABILITY Sensitivity: Public 5
Slide 7: Winning with our portfolio
We are building a stronger business 1 WINNING WITH OUR PORTFOLIO Sensitivity: Public 6
Slide 8: Winning with our portfolio
Winning with our portfolio Wide and resilient portfolio of Straddling Straddling price-benefit price-benefit Playing in new demand purposeful brands pyramid pyramid across across categories categories spaces Super Foods & Premium Refreshment Beauty & 29% Personal Care 39% Premium Home Care Popular 3
Slide 9: Our brands are getting bigger
Our brands are getting bigger… ₹ 50 Bn+ ₹ 20 Bn+ ₹ 10 Bn+ ₹50bn ₹9bn 3 Turnover added in FY’22 Turnover from innovations New ₹20 bn Brands Sensitivity: Public 8
Slide 10: … and stronger
… and stronger Product Superiority Product Superiority Award winning marketing campaigns Delivering hygiene one meal at a time 2X more superior products vs 2019 Won Most awarded 3 of world’s most Won 7 Silver award advertiser awarded campaigns awards Turnover added in FY’22 Sensitivity: Public 9
Slide 11: Excellent execution
We are building a stronger business 2 EXCELLENT EXECUTION Sensitivity: Public 10
Slide 12: Excellent execution
Excellent execution Agile and resilient supply Expanding our reach Perfect stores chain Effective Coverage* 1.15X 1.10X 8% YoY reduction in X distance travelled Production run every Pre-COVID MQ'21 MQ'22 3 days for 80% SKUs 1.15Y Assortment 1.10Y Y >99% of turnover produced locally Pre-COVID MQ'21 M
Slide 13: Strengthening competitiveness
We are building a stronger business 3 STRENGTHENING COMPETITIVENESS Sensitivity: Public 12
Slide 14: Growing consumer franchise, protecting our business model
Growing consumer franchise, protecting our business model Net Material Inflation* Savings Premiumisation 4.5X Highest market 7% 2X share gains Gross Savings % TO Premium growth vs rest In the last decade (FY’22) of the portfolio (FY’22) X Stepped-up Pricing Investing in Brands JQ'20 SQ'20 DQ'20 MQ'2
Slide 15: Digital transformation
We are building a stronger business 4 DIGITAL TRANSFORMATION Sensitivity: Public 14
Slide 16: Digital-first Lakme
Digital-first Lakme Hyper-connected Building brand across Superior consumer Scaling content and consumer journey multiple touch-points experience led by technology commerce 2.3 mn +160 mn +2 mn 30% Instagram followers LFW impressions Beauty tech triers Online sales Sensitivity: Public 15
Slide 17: Digitised demand capture now >20%
Digitised demand capture now >20% >800K Shikhar outlets Accelerating eCommerce Direct to Consumer Sensitivity: Public 16
Slide 18: Digital operations
Digital operations India’s 1st FMCG Lighthouse Nano Factories: Samadhan : Automated Factory (World Economic Forum) Supply chain for smalls Warehouse HUL’s Dapada Home Care 3 Nano factories – Advanced fulfilment centre Factory manufacturing +100 SKUs for N+1 delivery Sensitivity: Public 17
Slide 19: Leading sustainability
We are building a stronger business 5 LEADING SUSTAINABILITY Sensitivity: Public 18
Slide 20: Responsible growth: Doing well by doing good
Responsible growth : Doing well by doing good 94% 1.9 trillion litres 7 th >160K in 10K villages Reduction in CO2 emissions Cumulative water potential Suvidha centre in Mumbai Total Shakti entrepreneurs (kg/ tonne of production) against 2008 baseline created by HUF and its partners (since 2010) Sens
Slide 21: Ritesh Tiwari, Chief Financial Officer
Ritesh Tiwari Chief Financial Officer Sensitivity: Public
Slide 22: MQ'22: Strong close to the year
MQ’22 : Strong close to the year Turnover Growth EBITDA PAT (bei) Net Profit Growth Margin INR INR 10% 24.6% 2,283 cr. 2,327 cr. Flat -20 bps 9% 9% Underlying Volume Growth Change YoY Growth YoY EPS Growth YoY 21 Sensitivity: Public
Slide 23: MQ'22: Segmental performance
MQ’22 : Segmental performance BEAUTY & PERSONAL FOODS & HOME CARE CARE REFRESHMENT 31% 39% 29% INR 4,750 cr. INR 4,712 cr. INR 3,698 cr. Segmental Revenue Growth 24% 4% 5% Segmental Margins 20% 26% 19% Segment Revenue Growth = Segment Turnover growth + Other Operating Income, Segment Margins (EBIT)
Slide 24: MQ'22: Innovations
MQ’22 : Innovations Sensitivity: Public 23
Slide 25: MQ'22: Activations and communications
MQ’22 : Activations and communications Sensitivity: Public 24
Slide 26: Home Care: Stellar performance continues
Home Care : Stellar performance continues Fabric Wash: High double-digit growth driven by robust performance across the portfolio; volumes grew mid single-digit Liquids continue to outperform led by market development actions Household Care: High double-digit growth with both dishwash and surf
Slide 27: BPC: Steady performance, growing ahead of the market
BPC : Steady performance, growing ahead of the market Skin Cleansing: Strong quarter with double-digit growth driven by pricing. Beauty and premium soaps continue to perform well Hair Care: Strong competitive performance; all our brands continue to gain shares Skin Care: Double-digit growth in
Slide 28: F&R: Strong performance on a high-base comparator
F&R : Strong performance on a high-base comparator Beverages: Tea continued its strong outperformance growing on an exceptionally high base. Coffee delivered double-digit growth Health Food Drinks: Market share and penetration gains continue on the back of focused market development actions and
Slide 29: MQ'22: Results summary
MQ’22 : Results summary Rs. Crores Particulars MQ’22 MQ’21 Growth Sales 13,190 11,947 10% EBITDA 3,245 2,957 10% EBITDA Margin 24.6% 24.8% -20 bps Other Income (Net) 86 100 Exceptional Items – Credit / (Charge) 58 14 PBT 3,128 2,822 11% Tax 801 679 PAT bei 2,283 2,103 9% Net Profit 2,327 2,143 9% 28
Slide 30: FY'22: Solid all-round performance
FY’22 : Solid all-round performance Cash from Turnover Growth EBITDA Net Profit Operations Growth Margin INR INR 11% 24.8% 8,818 cr. 11,684 cr. 3% -20 bps 11% Underlying Volume Growth Change YoY EPS Growth (YoY) 29 Sensitivity: Public
Slide 31: FY'22: Segmental performance
FY’22 : Segmental performance BEAUTY & PERSONAL FOODS & HOME CARE CARE REFRESHMENT 31% 39% 29% INR 16,578 cr. INR 19,460 cr. INR 14,105 cr. Segmental Revenue Growth 19% 8% 7% Segmental Margins 19% 28% 19% Segment Revenue Growth = Segment Turnover growth + Other Operating Income, Segment Margins (EBI
Slide 32: FY'22: Proposed Final Dividend
FY’22 : Proposed Final Dividend Particulars FY’22 FY’21 Dividend per share 34 40.5 Special - 9.5 Interim 15 14 Final* 19 17 Total Dividend (Rs. Crores) 7,989 9,516 *Final Dividend number for FY 2021-22 is subject to approval by shareholders at the AGM 31 Sensitivity: Public
Slide 33: In summary
In summary FY’22 : Robust all-round performance in very challenging circumstances ₹50,336 cr. turnover, double digit topline growth - ahead of the market EBITDA margin at 24.8% remains healthy; 11% EPS growth Strengthened our market leadership position Highest market share gains in a decad
Slide 34: Outlook
Outlook Sensitivity: Public
Slide 35: Operating environment remains challenging
Operating environment remains challenging Significant increase in input CPI above RBI’s threshold Households anticipating costs higher inflation Consumer Price Index RBI’s Inflation expectation survey Ocean Freight 71% CPI above RBI’s threshold1.8X CPI above RBI’s threshold168 Palm (CPO) 59% 68% 1.6
Slide 36: Slowdown in FMCG market growth
Slowdown in FMCG market growth FMCG market volumes Discretionary categories more declining, flat value growth Rural slowdown continues impacted Nielsen FMCG Growth (Urban + Rural) Nielsen FMCG Growth (Rural) 15% Nielsen FMCG Value Growth (Urban + Rural) 15% 15% 10% 10% 10% L12M L12M L6M L6M 5% 5% 5%
Slide 37: Dynamic financial management
Dynamic financial management Productivity improvement Sequentially more inflation expected in JQ and SQ 2022 Buying efficiencies Sharper choice on investments 10% 8% Sweating our assets more 7% Operating leverage 1% 4.5X Design to value UPG Calibrated pricing actions NMI* X Bridge pa
Slide 38: Looking ahead: Near-term
Looking ahead: Near-term Challenging operating environment Inflation impacting volumes; growth predominantly to be price-led Expect more inflation sequentially Savings and calibrated pricing actions to continue Consumer franchise to be protected and strengthened Margins to decline in nea
Slide 39: Looking ahead: Mid-long term
Looking ahead: Mid-long term Indian FMCG sector continues to remain very attractive Favorable demographics and rising affluence Low per capita FMCG consumption and penetration Our drivers of value creation Topline growth driven by growing the core ahead of market, premiumisation and market
Slide 40: For more information and updates
For more information and updates Visit our IR website Awards & Felicitations Outstanding company of Sustainable factory of the People first HR No. 1 Dream company to the year by CNBC year award by Frost & Sullivan Excellence award work for - 2021 Sensitivity: Public