Leading FMCG player Dabur India has reported first quarter results, which are in line with market expectations. Top line growth remained strong during the quarter while the improvement in operating margins was better than expected. Dabur said it has completed operational integration of the acquired Balsara businesses.
Consolidated net profits for the quarter ended 30th June 2006 has increased 38.29 per cent to Rs 48.22 crore from Rs 34.87 crore for the previous year quarter. Consolidated net sales for the quarter increased 14.66 per cent to Rs 475.51 crore from Rs 414.7 crore.
Operating profits increased 35.65 per cent toRs 69.21 crore from Rs 51.02 crore for the prior year quarter. Operating margins as a percentage of net sales improved considerably by 225 basis points to 14.55 per cent from 12.3 per cent during the previous year quarter.
The improvement in margins was mostly on account of better control on input costs. Material costs and other inputs increased by 8.83 per cent during the quarter, lower than the growth in sales.
Advertising and marketing costs increased by 24.49 per cent over the previous year quarter while staff costs went up by 18.75 per cent. Other expenses were higher by 11.29 per cent.
Interest costs for the quarter remained almost unchanged while depreciation an amortisation charged went up by 28.1 per cent. The company benefited from a substantial increase in other income to Rs 5.28 crore from Rs 1.81 crore for the previous year quarter.
Contribution of various business segments to total revenues remained more or less at the same levels during the quarter. FMCG business contributed 86.7 per cent of revenues as compared to 86.15 per cent a year ago while foods business contributed 11.59 per cent as against 12.07 per cent.
92.61 per cent of profits before tax during the quarter came from the FMCG business. Foods contributed a marginal 1.5 per cent of PBT while other businesses contributed 5.89 per cent.
Consolidated results include the financial performance of the Balasara group of companies (Balsara Hygiene Products Limited, Balsara Home Products Limited and Besta Cosmetics Limited) which were acquired by Dabur. These companies will be merged with Dabur with retrospective effect from 01 April 2006 after getting all approvals.