Marico q-o-q marketing costs down 10.4% in Q4-2015, but up 15.8% in FY-2015

BENGALURU: Indian consumer products in beauty and wellness space company Marico Limited spent 10.4 per cent less towards advertisement and sales promotion (ASP, marketing) in the fourth quarter ended 31 March, 2015 (Q4-2015, current quarter) at Rs 137.15 crore (11.2 per cent of net Total Income from Operations or TIO) as compared to the Rs 153.02 crore (10.5 per cent of TIO) in the immediate trailing quarter, but 12.5 per cent more as compared to the Rs 121.91 crore (11.4 per cent of TIO) corresponding year ago quarter (Q4-2014). During FY-2015, the company’s ASP at Rs 649.82 crore(11.3 per cent of TIO) was 15.8 per cent more than the Rs 561.17 crore (12 per cent of TIO) in FY-2014.

Notes: 100,00,000=100 Lakhs = 1 crore = 10 million

During the 13 quarter period starting Q4-2014 until the current quarter, the highest amount spent by the company towards ASP was in Q1-2015 at Rs 192.18 crore (11.8 per cent of TIO). The company’s highest ASP spend in terms of per centage of TIO was in Q3-2013 at 14.1 per cent (Rs 152.82 crore). While in absolute rupees, ASP shows a linearly increasing trend during the 13 quarters under consideration, in terms of per centage TIO, the trend declines linearly during the same period. Please refer to Figs. A and A-1 below.

Marico’s TIO in Q4-2015 at Rs 1226,25 crore was 15.6 per cent less than the Q3-2015 TIO of Rs 1452.23 crore but was 14.4 per cent higher than the Rs 1072.76 crore in the year ago quarter. The highest TIO reported by the company during the 13 quarters under consideration was in Q1-2015 at Rs 1623.13 crore. TIO shows an increasing linear trend during this period. Please refer to Fig B below.

For FY-2015, Marico reported 22.3 per cent growth in TIO at Rs 5732.98 crore as compared to the Rs 4686.52 crore in the previous year – refer Fig A-1 above.

PAT in FY-2015 at Rs 573.46 crore (10 per cent TIO) was 18.1 per cent more than the Rs 485.38 crore (10.4 per cent of TIO) in FY-2014.

PAT in Q4-2014 at Rs 110.04 crore (nine per cent of TIO) was 31.2 per cent lower than the Rs 159.88 crore (11 per cent of TIO) and was 24 per cent more than the Rs 88.77 crore (8.3 per cent of TIO) in Q4-2014. During the 13 quarters under consideration, PAT shows an increasing linear trend both in terms of absolute rupees and in terms of per centage of TIO. Please refer to Fig B below:

Marico claims that it touches the lives of one out of every three Indians, through its portfolio of brands such as Parachute, Parachute Advansed, Saffola, Hair and Care, Nihar, Nina-r Naturals, Livon, Set Wet, Zatak, Mediker, Revive and Manjal. The company says that its international consumer products portfolio contributes to about 25 per cent of the group's revenue, with brands like Parachute, HairCode, Fiancée, Caivil, Hercules, Black Chic, Code 10, Ingwe, X-Men, L‘Ovite and Thuan Phat.

Marico MD and CEO Saugata Gupta said, “We continued our journey of delivering sustainable profitable growth this quarter. Simultaneously we are taking definitive long term steps in creating the organization of the future especially in our identified areas of transformation. We are confident of a gradual improvement of the sector growth in the coming quarters especially in the urban markets while the rural consumption trends will depend a bit on the performance of the monsoon.”

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