Decline in HUL’s profit by 2% to 638 crore

Decline in HUL’s profit by 2% to 638 croreThere has been a decline in the net profit of Hindustan Unilever (HUL). It has declined by about 2 percent to Rs 637.51 crore in the third quarter ended December 31, 2010.

Last year during the same period it was Rs 649.11 crore. This decline was the result of the high input cost inflation and a superior brand investment. On the other hand there was rise in the sales by 12 percent to Rs 5,027 crore during the quarter as compared Rs 4,504 crore last year in the same quarter.

During this quarter, the outlay of HUL was more as compared to the previous year, Rs 632.88 crore. It has spent Rs 743.26 crore on advertising and sales promotion-14.8% of its net sales.

As a result there has been an increase of 17% in the conditions of sharp competitive intensity.

There was a rise in the service costs and crude, along with the company's cost on expenditure of raw material and wrapping material. It has increased to 19% to Rs 1,942 crore. There is a decline in HUL's operating margins by 320 basis points.