INDIA – Tata Coffee’s value-added business has yet again delivered top-line growth for the business, pushing quarterly profits 25.55% higher during the quarter ending September 30th.
According to a BSE filing by Tata, net profit for the September quarter rose to Rs 53.66 crore (US$7.153m) up from the Rs 42.40 crore (US$5.65m) that was recorded in the previous quarter.
Tata has attributed the growth to improved performance in the value-added businesses which comprises of production and sale of roasted, ground, and instant coffee brands globally.
Tata Coffee’s Plantations Vertical saw total revenues down 18% yoy at Rs79 crore (US$1.053m) while the business’ value-added products division saw top-line growth of 6.2% at Rs479 cr (US$6.38m).
Total income attributable to the coffee business grew 1.40 percent during the second quarter of this fiscal to Rs 554.32 crore (US$73.89m), compared to Rs 546.63 crore (US$72.86) in the year-ago period.
According to Tata Coffee, the growth was primarily due to improved sales of instant coffee in India.
Tata Coffee Managing Director Chacko P Thomas hailed the business for the improved results that were achieved despite the business experiencing challenging conditions of unprecedented freight cost increases and inflationary pressures on input costs, including power and packing material.
“Our India Instant Coffee performance has been robust. We have seen stable performances across key geographies. Our Vietnam operations continue to be healthy despite higher sea freight costs, and the order pipeline continues to be encouraging,” Thomas added.
“Our Subsidiary, Eight O’Clock Coffee (EOC) has during the quarter recorded improved performance on account of favorable channel mix and better cost management.”
Tata Coffee is the coffee division of Tata Consumer Products, a subsidiary of Indian multinational conglomerate Tata Group.
Tata Consumer Product Q2 revenue estimates
In the recently published second quarter (July-September 21) earnings estimates for the Consumer Goods sector by KRChoksey, Tata Consumer Products is estimated to report net profit at Rs 280.5 crore up 9.1% year-on-year (up 51.5% quarter-on-quarter).
Net Sales are expected to increase by 11 percent Y-o-Y (up 3.6 percent Q-o-Q) to Rs 3,116.4 crore, according to the retail brokerage firm.
Earnings before interest, tax, depreciation, and amortization (EBITDA) are likely to rise by 9.2 percent Y-o-Y (up 9.2 percent Q-o-Q) to Rs 436.3 crore.
Earlier in September, L Krishnakumar, Executive Director and Group CFO, Tata Consumer Products Ltd said that the company is on track to achieve revenue and cost synergy targets following the integration process of its food and beverage businesses.
Krishnakumar in an interview with Business Line revealed that the company now plans to ramp up total distribution to about 4 million outlets in the next few years and accelerate its pace of innovation.
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