HUL cuts advertising spend, reports slight profit dip in Q2 FY25

FMCG major Hindustan Unilever (HUL) has reduced its advertisement and promotion expenses by 13.8 percent in the second quarter of the current fiscal year (FY2025).

The maker of brands like Dove, Pond's, and Horlicks has spent Rs 1,501 crore on a consolidated basis between July and September 2024 compared to Rs 1,742 crore in the corresponding quarter last year.

On a standalone basis, HUL splashed out Rs 1,464 crore on ads and promotion in the second quarter of FY25 from Rs 1,720 crore in the same period last fiscal year.

The company has also posted a marginal decline (at 4 percent) in profit to Rs 2,612 crore in Q2 FY25 from Rs 2,717 crore on a standalone basis.

On a consolidated basis, the profit after tax (PAT) for the quarter was recorded at Rs 2,595 crore from Rs 2,657 crore in Q2 FY2024--declined by 2 percent.

The total sales were Rs 15,729 crores grew by 2% during the quarter.

HUL's Earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter were marginally lower at Rs 3,793 crore compared to Rs 3,797 crore in the same period last year.

HUL's total standalone income in the second quarter stood at Rs 15,817, while the consolidated income was recorded at Rs 16,145 in the same period.

"In September quarter, FMCG demand witnessed moderating growth in Urban markets while Rural continued to recover gradually. In this context, we delivered a competitive and profitable performance. We continued to execute on our strategic priorities of transforming our portfolio whilst generating healthy EBITDA margin and cash flows, providing attractive returns to our shareholders," Rohit Jawa, CEO and Managing Director of HUL said.

The home care segment of HUL registered a revenue of Rs 5,731 crore in the second quarter of FY25, followed by food and refreshment at Rs 3,803 crore, beauty and wellbeing at Rs 3,421 crore, and personal care at Rs 2,411 crore, respectively.

In a BSE filing, HUL said that the 'Home Care' grew 8 percent with high-single digit UVG (underlying volume growth) in the September quarter. "The growth was broad based with both Fabric Wash and Household care growing volumes in high-single digit. Liquids portfolio, with a strong double-digit volume growth, continues to outperform. We continued to strengthen our liquids segment with the expansion of Rin liquid and forayed into the floor cleaner market with a superior product under the Vim brand," the FMCG brand said.

HUL's Personal Care segment declined 5 percent with negative pricing and low-single digit volume decline.

"Skin cleansing declined primarily on account of pricing actions taken during the year. Premium portfolio grew ahead of the segment and within that bodywash continued to strengthen its market leadership with high double-digit growth," HUL added.

Following the quarterly earnings, HUL stated it will focus on driving competitive volume-led growth, continue investment behind brands, and maintain cost savings and discipline through a net productivity programme in the future.

"We remain watchful of gradual recovery in consumer demand while creating a sustained competitive advantage through our business fundamentals: investing behind our aspirational brands, scaling market-making innovations and maintaining operational rigor," Java said.