Unilever Pakistan delivers stellar 1HCY23 performance, Profits surge to Rs5.2bn

August 25, 2023 (MLN): Unilever Pakistan Foods Limited (PSX: UPFL) profitability jumped by 55.22% YoY to clock in at Rs5.2 billion [EPS: Rs814.67] in 1HCY23 against the profits of Rs3.34bn [EPS: Rs524.86] reported in the same period last year (SPLY), company's filing on PSX revealed today. 

In view of the financial results for the three months ended June 30, 2023, the Directors have recommended an Interim Cash dividend of Rs72 i.e. (720%) per ordinary share of Rs10 each.

Going by the results, the business delivered sales growth of 44.6% to Rs18.73bn, led by pricing.

Volumes came under pressure as a result of sustained double-digit inflation and consequential erosion of consumer purchasing power, the company said in a financial statement issued to PSX.

On the expense side, distribution, admin, and other expenses rose by 59.2% YoY to Rs3.78bn in 1HCY23.

On the other hand, the other income of the company rose 4x YoY and stood at Rs1.17bn in 1HCY23.

On the taxation front, the company paid 99% YoY higher taxes worth Rs400m as tax payments against Rs201m paid in the corresponding period of last year.

Future Outlook:

Pakistan's economic and operating environment remains challenging. The recent IMF standby arrangement has provided temporary relief to the operating environment, however structural challenges remain to be addressed.

 Moreover, sustained inflation continues to impact consumer purchasing power, leading to more cautious spending habits including down trading and down grading, particularly for discretionary categories.

In light of the above, the company expects to face headwinds in respect of consumer demand.

“However, the management remains committed to creating long-term value for all stakeholders by leveraging global expertise and staying relevant to the consumers through sound understanding of their needs, innovations and new pack price architecture,” the statement reads.

“Our recent innovations including spicy tikka and iron-fortified noodles are a testament to our innovative mindset,” it added.

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