Britannia Industries Q1 net profit at Rs 216 crore; shares gain 6%

Key Highlights: 

• Britannia reports 1.41% decline in Q1 consolidated net profit
• Revenue from operations were Rs 2,339.81 crore
• Bloomberg poll estimated consolidated net profit at Rs 217 crore

Britannia Industries reported 1.41% year-on-year decline in its consolidated net profit for the quarter ended June 30, 2017.  The company posted consolidated net profit of Rs 216.12 crore compared to Rs 219.21 crore in the corresponding period of the previous year. 

However, consolidated Q1 net profit saw rise of 2.47% from Rs 210.91 crore of the preceding quarter. 

Total consolidated  revenue from operations were at Rs 2,339.81 crore, which was up by 6.51% year-on-year (YoY) but down by 0.39% on quarter-on-quarter (QoQ) basis. 

A Bloomberg poll estimated consolidated net profit and revenue to be at Rs 217 crore and Rs 2,227 crore respectively. 

Varun Berry, Managing Director of Britannia Industries said, "It has been a good Quarter in the face of challenging market environment and de-stocking in trade due to GST. While GST created a short term impact, it is expected to generate a positive momentum going forward. Our continued focus on enhancing direct reach coupled with our rural agenda have helped us drive growth and sustain share momentum during this difficult time."

On standalone front, net profit stood at Rs 208.69 crore, down 0.80% yoy but up 6.07 qoq. Revenue from operations were at Rs 2,195.41 crore, rising by 7.57% yoy and 1.58% qoq. 

Growth in International business continued to be under pressure due to deteriorating geopolitical situation and currency fluctuations in geographies like Middle East and Africa.

Also growth in Dairy business has been subdued primarily due to our focus on driving products with high profitability and reducing our play in the less profitable commoditized products, stated Berry. 

Berry further added, "On the commodity front, prices of key raw material continue to remain high with inflation in Q1 standing at around 6%. Meanwhile, our accelerated cost efficiency program and endeavour to leverage fixed costs have helped us improve our profitability on a sequential basis”.

After the Q1 announcement, share price of Britannia touched a 52-week high of Rs 4,140.95 per piece on BSE. At 1147 hours, the share was trading at Rs 4,114.50 per piece up by Rs 201 or 5.14%.