Procter & Gamble Hygiene and Health Care Limited (PGHH) performs exceptionally well sequentially but lagged up on a YoY basis | Q2 FY22 Quarterly Result Analysis

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Procter & Gamble Hygiene and Health Care Ltd. (PGHHCL), one of India’s fastest growing FMCG companies that have in its portfolio Whisper– India’s leading Feminine Hygiene brand, and Vicks – India’s No. 1 Health Care brand, and Old Spice has announced its Quarterly Results for the quarter ended 30th September 2021. The company that follows the financial year from 1st July to 30th June has reported revenue growth of 4.8%, but bottom-line i.e., Net Profit has gone down by 14% YoY to Rs. 218.3 Cr. in the September Quarter. Let’s discuss more about the performance of the company in this quarter, as we move ahead in this article,

Quarterly Result:

PGHH- Quarterly Result
PGHH- Quarterly Result
  • PGHH has posted a good result on a sequential basis but has disappointed on a YoY basis, where the company’s net profit has gone down by 14% YoY.
  • The revenue from operations of the company has increased by 4.8% YoY and 34.5% QoQ from Rs. 1,009.5 Cr. in September 2020 Quarter and Rs. 787 Cr. in June 2021 quarter to Rs. 1,058 Cr. in the quarter ended 30th September 2021.
  • The Earnings before Interest, Taxes, and Depreciation & Amortisation (EBITDA) of the company has come down by 10.9% YoY from Rs. 338 Cr. in the quarter ended 30th September 2020 to Rs. 301 Cr. in the quarter ended 30th September 2021. Quarter-on-quarter, the EBITDA has increased significantly by 302.4% from Rs. 75 Cr. in the quarter ended 30th June 2021.
  • The EBITDA margin stood at 28.5% for the September 2021 quarter, expanding by 1,900 bps QoQ and contracting by 500 bps YoY.
  • The company has registered a Net Profit of Rs. 218.3 Cr. for the quarter ended 30th September 2021 against Rs. 254 Cr. in the quarter ended 30th September 2020 down by 14% YoY but has gone up by remarkable 345.9% QoQ from Rs 49 Cr. in the quarter ended 30th June 2021.

Business Highlights:

  • The Revenue growth was driven by superiority strategy, robust product portfolio, and strong retail execution.
  • Net Profit went down by 14% YoY due to commodity cost inflation and lower marketing investments.
  • For the quarter, both Feminine Care and Health Care businesses grew ahead of their categories.

Management Comments:

Madhusudan Gopalan, Managing Director, PGHH:

“Despite a challenging market environment and a higher base period, we delivered strong growth in the first quarter driven by the strength of our trusted product portfolio and strong retail execution. We continue to remain focused on our strategy of driving superiority, improving productivity, leading constructive disruption, and strengthening our organization and culture. As the industry faces commodity inflation, we have doubled down our focus on driving productivity and innovation to drive balanced top and bottom-line growth.”

What Should Shareholders Do?

PGHH reported a strong sequential growth but lagged in terms of yearly basis. The company’s profit stands at Rs. 218.3 Cr. up by around 346% QoQ, but has fallen by 14% YoY. PGHH stock can be a good pick for conservative to moderate investors, but do not consider this as direct investment advice and do proper research and study before making any investment decisions.

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