Dabur India PBT down 2.5%

Continued slowdown in consumption in the local market has hit Dabur India’s profitability. The fast-moving consumer goods major on Tuesday declared 2.5 per cent drop in its profit before tax (PBT) for the July-september quarter.

The firm’s PBT declined from ~473.7 crore last year to ~461.8 crore. Apart from poor uptake, its bottom line was impacted by a one-time impairment in value of investments to the tune of ~40 crore.

During the quarter, the company clocked 4.1 per cent year-on-year (YOY) growth in consolidated revenue from operations, from ~2,125 crore to ~2,212 crore.

While the India business — forming 69 per cent of its total sales — rose 4.9 per cent, led by 4.8 per cent volume growth. Its international business, however, grew by 3.2 per cent — bringing down its overall volume uptake further.

A 35 per cent decline in its business in Nepal dragged down its overseas business growth. “The domestic business continues to face heavy headwinds in the form of a sustained slowdown in demand, aggravated by the liquidity crunch in the market,” said Mohit Malhotra, chief executive officer, Dabur India.

Benign raw material prices helped Dabur expand its operating revenue.

Its total cost of materials decreased by 142 basis points (bps) to touch 49.2 per cent in the quarter. Resultantly, operating margin improved by 91 bps to touch 22.1 per cent. Expenditures related to media and promotions, however, increased marginally.