INDIA- Britannia, the FMCG company, has reported a net profit decline of 3.6% compared to Q1 2023. The performance aligned with Wall Street Estimates amid a challenging operational and market environment.

Wall Street estimated Britannia’s profit-after-tax to be around US$63 million.  

Although the profit-after-tax declined in Q1 2024, total revenues increased by 1% to US$487 million.  

However, Wall Street predicted total revenues to be US$494 million.  

Britannia’s net profit declined by 3.2% compared to the previous quarter, while the total revenues decreased by 4.2% within the same period. 

The company’s net profit margin for the reported quarter also increased from 12.9% to 13% from the previous quarter. 

Britannia recorded a decline in operating margin from 17.42% in the previous quarter to 17.29% in the reported quarter.   

Following the results, the company’s board recommended a dividend of US$0.89 per share. 

The mixed results show the company’s resilience and commendable performance despite various challenges.  

Vice Chairman and Managing Director Varun Berry said, “Over the past 24 months, we have achieved a strong 19% growth in revenue, accompanied by a notable 43% increase in operating profit. Our market share rebounded as the year progressed as a result of strategic pricing actions to maintain competitiveness and intensified investments in brands, supported by distribution expansion.” 

Britannia expanded its distribution network to include 2.9 million direct outlets in the past year. 

These distribution networks helped the company broaden its market access.  

The company has also faced a surge in commodity prices that has driven the prices of its products upwards. 

The company attributes its resilience to its Cost Efficiency Program, which yielded operational savings of up to 2% of total revenues.  

The program helped the company maintain competitive pricing and was partly responsible for the resilience recorded.  

Berry said, “We bolstered our abilities to capitalize on rapidly growing channels like E-Commerce and Modern Trade, both of which experienced double-digit growth compared to the previous year.” 

The company reiterated its commitment to investing in brands, maintaining price competitiveness. 

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