India’s Godrej Consumer Profits do not see Indonesia’s weak market | So Good News
BENGALURU, Nov 8 (Reuters) – India’s Godrej Consumer Products ( GOCP.NS ) on Tuesday reported a bigger-than-expected drop in second-quarter profit, as revenue rose, while sales in Indonesia slowed.
Profit for the three months ended Sept. 30 was 3.59 billion Indian rupees ($44.01 million), compared to 4.79 billion a year ago, the company said in the exchange.
Analysts on average expected a profit of 4.11 billion rupees, according to IBES research from Refinitiv.
Consumer goods manufacturers around the world have been grappling with rising prices due to a glut of goods led by the pandemic, while rising commodity prices triggered by Russia’s invasion of Ukraine have added to their woes.
Godrej Consumer’s net income rose 14.4% to Rs 29.51 billion, while earnings before interest, taxes, depreciation and amortization fell 15%.
The decline was due to higher trading costs, higher costs and weaker demand in Indonesia, Latin America and several South Asian countries, Managing Director Sudhir Sitapati said in a statement.
The maker of Cinthol soap and Goodknight mosquito repellent has struggled in Indonesia, a key market, in the past few quarters amid economic problems exacerbated by high prices and intense competition.
Hygiene products took a nosedive in Indonesia as pandemic-induced demand slowed, leading to an 11% drop in recurring revenue.
Meanwhile, sales in India grew by 8%, driven by higher prices that led to a 5% decline.
“With inflationary pressures easing,” Sitapati said he now expects volumes to return to growth in the short term.
Net income from operations rose 7.2% to 33.92 billion.
Recurring revenue to Africa, the United States and the Middle East grew by 13% on the back of growth in the retail business.
The company’s shares closed flat on Monday. Indian markets were closed for a holiday on Tuesday.
($1 = 81.5690 Indian rupees)
Akansha Victor reports in Bengaluru; Edited by Dhanya Ann Thoppil
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