Unilever Pakistan has managed to grow profits by 16% during January to March 2012, much higher than the growth in sales of 11%.
Net profit of the country’s largest consumer goods manufacturer stood Rs1.04 billion in the first the quarter of 2012 against Rs899 million in the same period a year ago, according to a notice sent to the Karachi Stock Exchange on Wednesday. Analysts had cited tough economic conditions along with acute energy shortages to cascade profits in their 2011 review, however, these did not seem to make an impact.
Gross margins improved as a result of cost absorption and well-timed price corrections to mitigate the impact of higher input costs, the company management said in a notice.
The maker of more than 50 brands from fair and lovely to Knorr soup, managed the stellar growth despite 14% increase in advertising and promotion expense to Rs429 million following introduction of nine new brands since the same period last year.
The company’s board of directors also declared the first interim dividend of Rs65 per ordinary share of Rs50. Stock price rose 0.7% to close at Rs5971.83 during trade at the Karachi Stock Exchange.
Growth of the tea business, which represents 30% of total Unilever sales, has been affected by smuggling in recent years as only half of the tea consumed in the country is officially imported. Two of the biggest tea brands in the country Lipton and Brooke Bond Supreme are made by Unilever.
Published in The Express Tribune, April 21st, 2012.