Marico's revenue from operations stands at Rs 1824 crore in Q3 FY19
Profit after tax stood at Rs 272 crore, an 11% jump from the previous year
Marico Limited posted revenue from operations of Rs 1824 crore for the quarter & nine months ended December 31, 2019. Profit after tax stood at Rs 272 crore, an 11% jump from the previous year.
Benign input costs in the domestic and Bangladesh businesses led to gross margin expansion of 286 bps on a year-on-year basis. EBITDA margin expanded by 116 bps to 20.4%, as A&P spends (at 10.1% of sales) was up 12%. PAT grew 11%. The India business recorded a volume decline of 1%. While overall category growth rates were muted during the quarter, Marico brands’ offtake grew ahead of the category, resulting in market shares gains across most segments. The stress in consumption was particularly visible in personal care categories, while foods and allied categories showed resilience.
The consumption slowdown was most pronounced in the traditional channel. The new-age channels of Modern Trade and E-Commerce also slowed down considerably during the quarter. On the macro front, we stay optimistic of a gradual recovery, given the Government stimulus in play and expectations of further impetus to consumption from the upcoming Union Budget, especially against the backdrop of normal monsoons last year.
The company will continue to drive premiumisation across its portfolio in an endeavour to build franchises that deliver sustainable and profitable growth. As we revive growth in the core portfolios over the medium term, we expect an upward shift in new product contribution to top up this growth, especially with the rising salience of Modern Trade and E-Commerce.
The International business made another positive stride, delivering 10% constant currency growth, led by strengthening momentum in Bangladesh and healthy growth in exports to diaspora and other markets.
Marico’s India Business recorded a turnover of Rs 1380 crore (USD 194 million), down 5% on a year-on-year basis. The operating margin was at 23.2% before corporate allocations.
Marico’s International business grew by 10% in constant currency terms in Q3FY20. The operating margin was at 20.5% before corporate allocations.
Commenting on the performance, Saugata Gupta, MD & CEO said, “The Company witnessed a muted quarter in the India business as channel partners grappled with liquidity constraints and consumption trends failed to bring any cheer. However, relative offtake growth trends and market share gains in our key portfolios was reassuring. The International business continued to pitch in with a strong performance. Despite the macro overhang in the domestic business, the Company remains steadfast in its aspiration to deliver sustained volume-driven growth and franchise expansion over the medium term through specific consumer-focused initiatives and driving excellence in execution.”
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