Britannia Q1 pre-tax profit jumps 88% to Rs 737 cr, revenue rises 26%
Britannia, the food company, reported a stellar quarterly growth on Friday posting a profit before tax of Rs 737 crore for Q1FY20. A rise of 88 percent when compared to the corresponding period of the previous fiscal is also seen.
The net profit for the company grew 117 percent to Rs 546 crore on YoY basis. The consolidated revenue of the firm witnessed a strong growth of 26 percent on a YoY basis at Rs 3,384 crore, ahead of expectations.
The company’s volume growth for the period under review stood at 22 percent which is higher than analysts’ expectations of 17-20 percent.
According to Varun Berry, Managing Director of Britannia Industries, “What we have seen in the past is once you build a base, you find ways of growing beyond that so you might not see similar growth as we go forward but we would stride to grow over that base as we go forward”.
“As soon as the lockdown was eased, we focussed on getting our distribution back to the pre-COVID levels and increasing our rural and hinterland reach. During this period, we also launched ‘Winkin Cow Lassi’ and a Rs 5 layer cake pack to expand our reach. All the adjacent businesses too delivered a healthy profitable growth,” he added.
“Given the dynamic nature of the pandemic and associated uncertainty, we were quick to resort to cost efficiencies through the extraction of supply chain efficiencies, reduction in wastage, and fixed cost leverage. We also rationalized the media spends considering the constraints of inventories due to higher market demand. These measures helped us improve the shape of our business and record a massive 670 bps increase in operating profit during the quarter,” he said.
Such strong performance presents a very high base for the company.