United Breweries Ltd, a beer maker controlled by Dutch multinational brewing company Heineken NV, disclosed on Thursday a decline of 93.97% in its consolidated net profit for the March quarter, amounting to INR 9.87 crore. As per a regulatory filing by United Breweries Ltd (UBL), the company had reported a net profit of INR 163.78 crore in the January-March quarter of the previous year.
During the quarter under review, UBL’s revenue from operations increased by 11.35% to INR 4,081.01 crore. In the corresponding period of FY22, it had stood at INR 3,664.71 crore.
“Gross margin during the quarter was lower as compared to PY (previous year) due to continued inflationary pressures on our cost base, particularly on prices of barley and packaging materials,” said UBL in its earnings statement.
UBL’s premium segment outperformed its total portfolio, growing by 19% in the quarter and registering a robust YTD growth of 58%. This growth was fueled by popular brands like Heineken, Kingfisher Ultra, and Kingfisher Ultra Max.
“Price increases have been taken across multiple states with continued commitment in driving further revenue management initiatives,” it added.
In Q4FY23, UBL’s total expenses increased by 17.93% to reach INR 4,079.32 crore, up from INR 3,458.98 crore in the corresponding period a year ago.
UBL’s total income for the March quarter increased by 11.28% to reach INR 4,092.80 crore.
UBL’s net profit for the financial year ending in March 2023 declined by 15.97% to reach INR 308.10 crore, as compared to INR 366.68 crore in FY22.
Despite the decline in net profit, UBL’s consolidated revenue from operations for FY23 increased by 26.87% to reach INR 16,651.09 crore, up from INR 13,123.92 crore in the previous year.
The company reported that it achieved “all-time high full-year volumes,” indicating sustained growth in the category.
UBL’s Capex spend was INR 156 crore and it said, “with volume growth expected to continue, Capex investments are needed to meet future growth”.
According to the company, it anticipates continued inflationary pressure on its cost base in the near future.
“The company will seek appropriate action to further mitigate the impact. UBL continues to remain optimistic on the long-term growth potential of the industry, driven by increasing disposable income, favourable demographics and premiumisation,” it said.
As per the filing, UBL’s board recommended a dividend of 750% or INR 7.50 per equity share of INR 1 each to the company’s shareholders for the financial year that ended on March 31, 2023.
On Thursday, United Breweries Ltd’s shares settled at INR 1,430 apiece on the BSE, reflecting a decrease of 0.28%.