Hindustan Unilever Ltd. - Quarterly/Annual Result Disclosures and Notes dated 31 Dec 2018

Auditor and Management Disclosures and Notes for the quarterly results dated 31 Dec 2018

1. Sales grew by 12% during the quarter, Domestic Consumer sales grew by 13% during the quarter.

2. The amount of budgetary support under GST (Goods and Service Tax) in relation to the existing eligible units under the different Industrial Promotion Schemes was recognized as "Other Operating Revenue" in JQ-18. In SQ-18, such amounts were recognized as "Other Income". The cumulative amount of budgetary support has now been reclassified as "Other Operating Revenue" in the quarter and for nine months ended December 31, 2018. This has no impact on reported Profit Before Tax (PBT).

3. Earnings before interest, tax, depreciation and amortization (EBITDA) for the quarter at Rs. 2,0466 crores (DQ 17: Rs.1,680 crores) grew by 22%. EBITDA margin improvement is 170 bps vs DQ 17.

4. Profit After Tax before Exceptional Items for the quarter at Rs. 1,401 crores (DQ 17: Rs 1,198 crores) grew by 17%.

5. Exceptional items, net charge in DQ 18 includes restructuring expenses Rs. 46 crores (DQ 17: Rs. 27 crores), acquisition and disposal related cost Rs. 16 crores (DQ 17: Rs. Nil) and profit on sale of surplus properties Rs. Nil (DQ 17: Rs. 6 crores).

6. Tax Expenses for the quarter includes adjustments of previous years amounting to a credit of Rs. 83 crores (DQ 17: Rs. 142 crores).

7. Profit After Tax for the quarter at Rs. 1,444 crores (DQ 17: Rs.1,326 crores) grew by 9 %.

8. On 3rd December 2018, the Board of Directors of Hindustan Unilever Limited (HUL) approved a Scheme of Amalgamation between the Company and GlaxoSmithKline Consumer Healthcare Limited (GSK CH India) subject to obtaining requisite approvals from statutory authorities and shareholders. The proposed Scheme provides that on the Scheme coming into effect 4.39 shares of HUL of face value of Re. 1 each will be allotted for every 1 share of GSK CH India of face value of Rs. 10 each. The Company is in the process of seeking requisite approvals / no objections from Stock Exchanges and Competition Commission of India (CCI) in this regard.

9. Pursuant to the order dated 30th August, 2018 the Hon'ble National Company Law Tribunal, Mumbai Bench, approved the Scheme of Arrangement for transfer of the balance of Rs. 2,187 crores standing to the credit of the General Reserves to the Profit and Loss Account. The Company filed the Order and the Scheme with the Registrar of Companies (ROC) on 5th October, 2018 and has subsequently reclassified the amount standing to the credit of the General Reserves to the Retained Earnings.

10. Previous period figures have been re-grouped / re-classified wherever necessary.

11. The above results have been reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on 17th January, 2019.

Sanju Mehta
Chairman & Managing Director