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HLL's profit after tax jumps 40%; Rs 7.50 interim dividend

Hindustan Lever Limited, the country's premier consumer products company, has reported impressive results for the half-year ended June 30, 1997. The HLL board, which met in Bangalore on Tuesday, announced an interim dividend of Rs 7.50 per share, which represents a 25 per cent growth over the interim of Rs 6 per share declared in 1996.

According to a company release, net sales have grown by 19 per cent to Rs 38.91 billion, compared to Rs 32.76 billion during the corresponding period last year. Profit before taxation stood at Rs 3.727 billion, while profit after taxation, at Rs 2.5628 billion, has jumped by 40 per cent over last year's Rs 1.8335 billion.

Exports of HLL and its wholly-owned subsidiaries crossed the Rs 5 billion mark, led by the growth in value-added products like personal care items, soaps, detergents, and packet tea.

The company release further stated that excellent financial management resulted in a sharp 35 per cent drop in interest cost from Rs 284.8 million in the first half of 1996 to Rs 184 million.

The pace of rapid growth in all business categories of HLL has been sustained in the first half of 1997 through several product innovations, the company release claimed.

The release further stated that when the erstwhile Tata Oil Mills Co Ltd was being amalgamated in 1994, in terms of an interim order issued by the Bombay high court in November 1994, an amount of Rs 1.7757 billion, brought in by Unilever PLC, was held in an escrow account pending the final disposal of a writ petition filed by the company. This writ petition was related to pricing of the preferential allotments of shares of Unilever PLC.

In June 1997, HLL and the Reserve Bank of India arrived at a settlement, in terms of which the price for the preferential allotment was agreed at Rs 357 per share (representing the 6-month average market price prior to March 1993) as against the price of Rs 105 approved by the shareholders.

Accordingly, an amount of Rs 752.1 million, being the difference at Rs 252 per share on 2.984 million shares, has been appropriated by the company to its share premium account in June 1997. The income derived on investment of the aforesaid Rs 752.1 million, while it formed part of the escrow account, aggregating to Rs 255.8 million, has also accrued to the company and his has been included under other income.

The interim dividend will be paid to shareholders whose names appear on the register of members at the close of business on October 10, 1997, which has been fixed as the record date for the purpose.

HLL denies SEBI charge