INDIA – United Breweries Limited (UBL), a subsidiary of beverage giant Heineken N.V., has announced a remarkable six-fold surge in profit during the fourth quarter ended March 31, 2024, with net profit soaring to Rs 80.15 crore (US$9.6M) from Rs 13.05 crore (US$1.56M) recorded in 2023.
The company’s full fiscal year results also reflect robust growth, with net profit rising by 33 percent to Rs 412.59 crore (US$49.4M) compared to Rs 308.10 crore US$36.9M) in the previous year.
The surge in profit was accompanied by a substantial increase in revenue from operations, which rose by 17 percent to Rs 4,788.68 crore during the quarter.
Notably, UBL experienced a significant surge in volume during this period, up by 10.9 percent, driven predominantly by the South and East regions, showcasing the company’s strong regional presence and market penetration.
Highlighting the success of its premium segment, UBL reported a 21 percent expansion, propelled by the outstanding performances of flagship brands like Kingfisher Ultra and Kingfisher Ultra Max.
“We continue to invest behind our brands & capabilities in combination with revenue management and cost initiatives,” the company stated. Investments in capex during the year amounted to Rs190 crore (US$22.75M)), primarily in supply chain initiatives to cater for future growth.
In addition to its financial achievements, United Breweries introduced Queenfisher to commemorate International Women’s Day and London Pilsner Strong Beer in Karnataka during the quarter, underscoring the company’s dedication to meeting diverse consumer preferences and capitalizing on special occasions and local market opportunities.
The company’s Earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter stood at Rs 142.9 crore (US$17.11M), showcasing a healthy operational performance.
Notably, EBITDA margins witnessed a significant improvement, rising by 370 basis points year-on-year to 6.7 percent.
Despite these impressive results, United Breweries faced a dip in its share prices, prompting questions among investors about market sentiment. However, the company remains optimistic about the industry’s long-term growth prospects despite inflationary pressures.
“Despite some inflationary softening as seen from Q2, volatility will remain. We remain optimistic about the long-term growth potential of the industry, driven by increasing disposable income, favourable demographics & premiumisation,” it added.
Concurrently, the company announced the appointment of Mr Jorn Kersten as the Chief Financial Officer and Key Managerial Personnel, effective August 1, 2024, signaling a strategic step towards further strengthening its leadership team.
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