Hindustan Unilever Cuts Ad Spend By 13.8% In Q2FY25

Hindustan Unilever (HUL) has reported a 13.8 per cent decrease in advertisement and promotion expenses for the second quarter of the current fiscal year (FY2025).

The company, known for brands like Dove, Pond's, and Horlicks spent Rs 1,501 crore on a consolidated basis from July to September 2024, down from Rs 1,742 crore during the same period last year. On a standalone basis, HUL’s advertising and promotion expenditure fell to Rs 1,464 crore in Q2 FY25 from Rs 1,720 crore in the previous fiscal year.

Additionally, HUL experienced a slight decline of 4 per cent in standalone profit, reporting Rs 2,612 crore for Q2 FY25 compared to Rs 2,717 crore in the same quarter last year. On a consolidated basis, profit after tax (PAT) was Rs 2,595 crore, a 2 per cent drop from Rs 2,657 crore in Q2 FY2024.

Total sales for the quarter reached Rs 15,729 crore, reflecting a 2 per cent growth. HUL's Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) slightly decreased to Rs 3,793 crore from rs 3,797 crore in the same period last year. The company’s total standalone income for the second quarter was Rs 15,817 crore while consolidated income was reported at Rs 16,145 crore for the same timeframe.

Rohit Jawa, CEO and Managing Director of HUL commented, “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.”

HUL's home care segment reported revenues of Rs 5,731 crore in the second quarter of FY25, making it the top performer. This was followed by the food and refreshment segment which generated Rs 3,803 crore, the beauty and wellbeing segment at Rs 3,421 crore and personal care at Rs 2,411 crore.

In a filing with the BSE, HUL noted that the home care segment grew by 8 per cent in the September quarter, driven by high single-digit underlying volume growth (UVG). "The growth was broad-based with both Fabric Wash and Household care growing volumes in the 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 experienced a 5 per cent decline, attributed to negative pricing and a low single-digit drop in volume.

"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.

Post its quarterly earnings, HUL indicated that it will prioritise competitive volume-led growth, continue investing in its brands and uphold cost savings and discipline through a net productivity program moving forward.

"We remain watchful of a 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 rigour," Java said.