Kolkata-based FMCG company Emami registered a four per cent rise in standalone net profit at ₹97 crore for the quarter ended June 30, 2022, as compared with ₹93 crore in the same period last year. Revenue from operations on a standalone basis increased by nearly 13 per cent at ₹688 crore as against ₹608 crore in the same period last year.

Unprecedented inflationary headwinds continued to impact the FMCG sector leading to softening of consumer sentiment across urban and rural markets, resulting in lower margins during the quarter. Despite the overall challenging macro environment, Emami’s consolidated revenues at ₹778 crore grew by 18 per cent during the quarter under review.

International business looks up

Domestic business, which accounts for nearly 85 per cent of its total sales grew by nearly 13 per cent over last year. International business, which accounts for around 15 per cent of total sales, grew by 45 per cent y-o-y led by key geographies like MENA and SAARC. All major brands performed well in the international markets, the company said in a press statement on Friday.

“The quarter was dominated by strong performance of major brands like Navratna, Kesh King and Fair and Handsome. However, pain management and healthcare range, particularly the immunity portfolio, witnessed corrections on account of exceptional growth in the same quarter last year due to the second wave of the pandemic. Excluding pain management, healthcare range and the acquired brand Dermicool, other brands witnessed growth of 30 per cent in the domestic business,” the release said.

Both modern trade and e-commerce continued to perform well, to post a growth of 42 per cent and 55 per cent respectively. In Q1-FY23, the contribution of modern trade and e-commerce channel increased to close to 16 per cent of domestic revenues.

Gross margins

In Q1-FY23, gross margins at 62.6 per cent contracted by 340 basis points due to inflationary pressures combined with unfavourable portfolio mix due to extraordinary high sales of pain management products last year. EBIDTA at ₹173 crore grew by two per cent.

“We are happy to post another quarter of strong resilient performance despite unprecedented inflationary headwinds impacting consumer offtakes as well as material costs. We remained focused on optimising costs while driving growth. We look forward to a consistent and profitable growth in times to come,” Harsha V Agarwal, Vice Chairman and Managing Director, Emami said in the statement.  

The company’s scrip closed at ₹450.05, down by 0.98 per cent on the BSE on Friday.

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