Aditya Birla Fashion and Retail posted net profit of Rs 94 crore for the quarter ended June against net loss of Rs 352 crore last year on the back of improved sales after Covid.
The company’s revenue from operations rose 254% year-on-year to Rs 2,875 crore on low base and improved consumer sentiment.
Last year, second Covid wave had led to demand destruction, as a result of which, the company’s sales suffered and total expenses were higher than the sales, leading to negative operating margin.
This year, in April-June, the company reported operating margin of 17.4%, up 130 basis points over pre- Covid levels. Margin could have expanded more had it not been for 112% year-on-year increase in total expenses due to high raw material cost.
However, the company said that inflationary pressure continued to expand cost base for retailers, most of which was passed on to end consumers.
On overall performance, the company said that there has been a sharp recovery in demand across categories and it expects the momentum to continue in upcoming quarters, with a further boost during the festive season.
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With improved consumer confidence, brands and retailers are now back to aggressive store network expansion, the company said in its investor presentation. The company also said it would enhance investments in brand building.
For April-June, the company’s lifestyle brands’ revenues grew 51% over pre-Covid levels to Rs 1,519 crore, while earnings before interest tax, depreciation and amortization grew 40% to Rs 266 crore.
Pantaloons business reported highest ever revenues of Rs 1,027 crore, while Ebitda grew 33% over pre-Covid levels.