Aditya Birla Fashion and Retail Ltd (ABFRL) on Friday posted its fiscal first quarter earnings wherein it reported a loss of Rs 161.62 crore from a profit of Rs 94.44 crore during the corresponding quarter of FY23. It posted revenue from operations at Rs 3,196.06 crore, up 47 per cent in comparison to Rs 2,174.76 crore during the first quarter of FY23. The company said that the sales grew across brands and formats despite unfavourable market conditions. “The growth in quarterly revenue was driven by a strong pick-up in new businesses and consistent performance from established businesses, despite challenging market conditions. However, net profits for the quarter were affected by negative operating leverage, resulting from subdued sales for the Pantaloons business, as well as continued investments in TMRW and ethnic businesses,” it said in a regulatory filing.
The EBITDA for the quarter stood at Rs 353 crore and EBITDA margin was 11 per cent. While the total income during the quarter was at Rs 3,256.35 crore, total expenses in Q1FY24 was at Rs 3,458.02 crore.
ABFRL has a store network of 4000+ outlets and the company continues to expand. While its branded business network added 28 stores on a net basis in Q1, the ethnic business added 12 stores to the network, and Pantaloons added net 3 stores to its network during the quarter. Meanwhile, ABFRL also continued to expand its digital footprint. It recorded e-commerce sales growth by 12 per cent on-year with “strengthened omnichannel play”. Further TMRW too started driving value creation for its portfolio of brands through operational interventions, the company said.
ABFRL’s Q1 performance across businesses
While ABFRL’s Madura Fashion & Lifestyle posted revenue at Rs 2,220.92 crore during the quarter ended June 2023, the Pantaloons business recorded a revenue of Rs 1,029.74 crore in Q1FY24. Here is a look at Q1 performance by ABFRL’s businesses:
ABFRL’s Lifestyle brands posted sales growth of 5 per cent on-year at Rs 1594 crore, while the EBITDA expanded by 10 per cent over the last year to reach Rs 292 crore. During the quarter, the women’s wear business maintained strong growth, with a 9 per cent YoY increase. Brands consistently focused on improving retail throughputs and enhancing the store shopping experience.
Pantaloons business demonstrated a resilient performance in Q1, recording sales of Rs 1030 crore and an EBITDA margin of 13.4 per cent, despite a subdued demand environment across various markets. The private label portfolio showed promising results, with its overall share increasing to 65 per cent from 62 per cent the previous year.
In Q1, American Eagle achieved a 49 per cent YoY revenue growth, expanding its availability to 40 exclusive stores and over 65+ department stores. Meanwhile, Forever 21 continues to prioritise operational efficiency and network rationalisation.
Reebok recorded a sales growth of 43 per cent over last year. It opened 10 new stores in the first quarter and also continued to broaden its department store collaborations and marketplace partnerships.
The inner wear and athleisure segment recorded a 3 per cent retail LTL growth, despite the ongoing slowdown in the athleisure and activewear segment. During the quarter, the brand added over 700 Multi Brand Outlets (MBOs), bringing its total presence to ~32700 trade outlets.
In terms of its super premium brands which include The Collective and other super-premium brands, ABFRL delivered a solid performance in the first quarter with revenue growth of 16 per cent on-year.
Its ethnic businesses grew ~33 per cent YoY this quarter, driven by network expansion and brand development initiatives. Sabyasachi grew 18 per cent YoY this quarter led by strong performance in jewelry and accessories segments. TASVA added 7 stores in this quarter. Shantnu & Nikhil posted 20 per cent growth YoY as its bridge business “S&N” grew to 1.6x of LY. House of Masaba added 3 stores to the network as it posted 32 per cent revenue growth over the last year.