Colgate Palmolive Share Q3 Results

Colgate Palmolive Ltd

by 5paisa Research Team Last Updated: Dec 11, 2022 - 06:51 am 39.1k Views
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Most FMCG companies have been under pressure due to the spike in raw material and input costs. Some like Colgate have managed it with much better tweaking of costs in the quarter. Here is a classic example. To combat the sharp spike in input cost, inventory cost and manpower cost, Colgate has reduced the advertising and publicity spend in the quarter, which has helped them to hold margins. New product launches helped.
 

Colgate Palmolive Quarterly Results
 

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income (Rs cr)

₹ 1,280.12

₹ 1,231.93

3.91%

₹ 1,352.42

-5.35%

EBITDA (Rs cr)

₹ 336.63

₹ 325.05

3.56%

₹ 355.87

-5.41%

Net Profit (Rs cr)

₹ 252.33

₹ 248.36

1.60%

₹ 269.17

-6.26%

Diluted EPS (Rs)

₹ 9.28

₹ 9.13

 

₹ 9.90

 

EBITDA Margin

26.30%

26.39%

 

26.31%

 

Net Margins

19.71%

20.16%

 

19.90%

 

 

Let us look at the Colgate top line first. Colgate Palmolive reported 3.91% YoY growth in total sales revenues for the Dec-21 quarter at Rs.1,280.12 crore. On a sequential basis, revenues were down by -5.35%. In the Dec-21 quarter, Colgate Palmolive reported stable performance in its core personal care and oral care verticals. The Palmolive face cream brand also marked its entry into the Indian markets.

Even as Colgate has been trying to draw the right balance between volumes and growth the operating performance was managed well in a tough Dec-21 quarter. The operating profits were up  3.56% at Rs.336.63 crore on a YoY basis. Of course, there was a sharp spike in cost of raw materials, inventory costs and employee benefits. This was strategically offset by reducing the advertising and publicity cost in the quarter by 25% YoY.

Let us now turn to the bottom line. Net Profit for the Dec-21 quarter was up just about 1.60% YoY at Rs.252.33 crore, but this was appreciable in a tough year. Innovation and product launches helped. The operating performance got transmitted to the bottom line. The net profit growth did get impacted by lower other income in the Q3. Colgate launched Colgate Gum Expert with Curcumin extracts in the quarter to expand its portfolio offering.

Let us finally turn to the margin story of Colgate Palmolive India. Operating margins fell marginally from 26.39% in Dec-20 quarter to 26.30% in the Dec-21 quarter and it was flat on a sequential basis. It is always encouraging to maintain margins in a tough quarter, especially when input costs, inventory costs and manpower costs are putting pressure.

PAT margins, however, fell from 20.16% in the Dec-20 quarter to 19.71% in the Dec-21 quarter and this can be largely attributed to lower other income in the December 2021 quarter. The PAT margins were just marginally lower on a sequential basis too.

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