P&G Hygiene and Health Care shares slip 5% after Q1 profit drops 34%, margin contracts

Shares of Procter & Gamble Hygiene and Health Care fell as much as 5.5% on Wednesday, July 29, as the company reported weak earnings for the June quarter, with profit and revenue declining due to higher commodity costs and increased investments in advertising.

The company's net profit fell 34.3% to ₹126.3 crore during the quarter from ₹192.1 crore a year earlier. Revenue from operations declined 4.9% to ₹891.5 crore from ₹937 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 36.1% to ₹170.1 crore from ₹266.2 crore. EBITDA margin contracted to 19.1% from 28.4% in the corresponding quarter last year.

The company said sales for the quarter stood at ₹901 crore, down 5% from a year ago, while profit after tax was impacted by commodity cost fluctuations arising from geopolitical uncertainties. It added that it continued to invest significantly in innovation as well as higher advertising and promotional spending during the quarter to support long-term competitiveness and value creation.

"We continue to invest strategically behind our brands, innovation and market capabilities, even as the geopolitical environment remains challenging," Managing Director Kumar Venkatasubramanian said.

He added that the company remains confident in its Integrated Growth Strategy, which focuses on a portfolio of daily-use categories where performance drives brand choice, alongside product and packaging superiority, productivity, constructive disruption, and an agile organisation.

"We believe the continued execution of this strategy will strengthen our business, unlock future growth opportunities and build an even stronger company for the future," he said.

Procter & Gamble Hygiene and Health Care markets brands including Whisper, Vicks and Old Spice in India. The company said it remains focused on strengthening its portfolio of daily-use health and hygiene products through continued investments in innovation and brand building.

Shares of the company fell as much as 5.5% to an intraday low of ₹8,481 following the June quarter results announcement on Wednesday. The stock was trading 3.6% lower at ₹8,647 as of 1.31 pm. It has declined more than 33% so far in this calendar year.

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