Unaudited financial results for the quarter and first half ended 30 September 2023
Bengaluru, India – November 08, 2023: United Spirits Ltd., one of the leading beverage alcohol companies in India, reported its unaudited consolidated & standalone results for the first half & second quarter of the fiscal year ended 31 March 2024.
Key Highlights for the quarter:
• Net sales value (NSV) at INR2,867 Cr.; EBITDA at INR467 Cr.
• NSV grew by 12.0% and EBITDA grew 21.4% on rebased prior year comparators
• Net sales value (NSV) at INR2,865 Cr., with Prestige & Above saliency of 88%
• Total NSV grew 12.2%, Prestige & Above NSV grew 12.8%, both on rebased prior year comparators
• EBITDA at INR470 Cr. with margin of 16.4%
Ms. Hina Nagarajan, CEO & Managing Director, commenting on the Q2FY24 performance, said:
“We have maintained the growth and margin momentum in the second quarter of fiscal 2024 on the back of sustained investment in our brands and proven productivity muscle. Continuing our future-back consumer focus approach, we have now brought our global Tequila trademark Don Julio to India. This is in line with our strategy & commitment to bring the best from around the world for our aspiring Indian consumers. We are optimistic on the India potential of this opportunity in-line with global trends. I am also delighted to inform that the Board of Directors have approved an interim dividend of INR4.0 per share. This is after a long hiatus, enabled by the successful turnaround of the Company to sustained profitability. We take the opportunity to thank our long-term investors for their patience and commitment. Looking ahead, our priority is to sustain the growth momentum and realise the full potential of our portfolio offerings. While inflationary headwinds remain challenging, we remain focused on revenue growth management & value chain productivity in our quest of long-term value creation for all our stakeholders.”
(The scheme for the Pioneer Distilleries Limited merger came into operation on 30th Dec’ 2022 but is effective 1st April’2021. All current & previous period comparators include the impact of the merger. All accounts referred as ‘Rebased’ are Reinstated for PDL merger as well as adjusted for slump sale and franchising of the strategically reviewed popular portfolio for a like for like comparison.)
Q2FY24 performance highlights:
• Consolidated net sales at INR2,867 Cr., up 12.0% on rebased prior year comparators, in line with growth in the standalone business.
• Consolidated EBITDA was at INR467 Cr., growth of 21.4% on rebased prior year comparators.
• Q2FY24 consolidated Profit after tax was at INR339 Cr.
• Net sales at INR2,865 Cr. increased 12.2% on rebased prior year comparators driven by continued premiumisation tailwinds, and improved footprint & saliency of our innovation / renovation offerings. Within
the above, Prestige & Above segment grew 12.8%.
• Net sales for the Popular segment grew 1.0% on rebased prior year comparator reflecting sequential improvement, however, still weighed by inflation impacting the target consumer & duty increases in the
segment’s salient state.
• Gross margin was 43.4%, up 278 bps versus last year and continuing the sequential quarter-on-quarter improvement on an underlying basis.
• A&P re-investment rate was 8.4% of sales, largely reflecting the seasonality and investment behind the brands ahead of festive quarter & cricket world cup.
• EBITDA at INR470 Cr., an increase of 20.9% over rebased prior year comparator. EBITDA margin was 16.4%, up 118 bps versus last year.
• Interest cost at INR26 Cr., up 24.8%, largely due to interest on custom duty as BIO supply chain normalises after the prior year volatility.
• Exceptional gain of INR31 Cr. is on account of final tranche of income from the slump sale and is now recognised as exceptional income post completion of customary obligations.
• Profit after tax was INR341 Cr. with net profit margin at 11.9%.
(The scheme for the Pioneer Distilleries Limited merger came into operation on 30th Dec’ 2022 but is effective 1st
April’2021. All current & previous period comparators include the impact of the merger. All accounts referred as ‘Rebased’
are Reinstated for PDL merger as well as adjusted for slump sale and franchising of the strategically reviewed popular
portfolio for a like for like comparison.)
H1FY24 performance highlights:
• Consolidated net sales for H1FY24 was at INR5,535 Cr., up 19.5% on rebased prior year comparators. This was led by the strong growth in the standalone business and new five-year media rights cycle (2023-27) for the Indian Premier League starting from Q1FY24.
• Consolidated EBITDA for H1FY24 was at INR1,180 Cr., a growth of 69.7% on rebased prior year comparators.
• H1FY24 consolidated Profit after tax was at INR816 Cr.
• Net sales at INR5,037 Cr. increased 14.4% on rebased prior year comparators driven by continued premiumisation and improved footprint & competitive performance of our innovation / renovation offerings. Within the above, Prestige & Above segment grew 16.3%.
• Net sales for the Popular segment grew 1.0% on rebased prior year comparator, weighed by inflation impacting the target consumer & duty increases in the segment’s salient state.
• Gross margin was 43.5%, up 220 bps versus last year, driven by headline pricing realisation flow-thru, revenue growth management and cogs productivity initiatives.
• A&P re-investment rate was 7.7% of sales, largely reflecting the low seasonality of the April to June quarter and ramped up investment behind the brands & cricket world cup in the July – September quarter.
• EBITDA at INR855 Cr. is an increase of 42.8% over rebased prior year comparator. Underlying EBITDA margin was 16.7%, up 253 bps versus last year. This was largely driven by gross margin expansion
and productivity across the value chain.
• Interest cost at INR31 Cr. is down 30% versus prior year. Excluding the one-off reversal benefit of INR15 Cr. in Q1FY24, interest cost was INR46 Cr., up 4.8% against prior year. Interest cost is on account of customary non-debt related expenses.
• Exceptional gain of INR14 Cr. is on account of INR31 Cr. from the final tranche of Income from the slump sale, which is now recognised as exceptional income post completion of customary obligations partially offset by a charge of INR17 Cr. related to supply agility program in Q1FY24.
• Profit after tax was INR580 Cr. with net profit margin at 11.5%.
About Diageo India
Diageo India is among the country’s leading beverage alcohol company and a subsidiary of global leader Diageo Plc. The company manufactures, sells and distributes an outstanding portfolio of premium brands
such as Johnnie Walker, Black Dog, Black & White, VAT 69, Antiquity, Signature, The Singleton, Royal Challenge, McDowell’s No1, Smirnoff, Ketel One, Tanqueray, Captain Morgan and Godawan, an artisanal single malt whisky from India. Headquartered in Bengaluru, our wide footprint is supported by a committed team of over 3000 employees, 37 manufacturing facilities across states and union territories in India, a strong distribution network and a state-of-the-art Technical Centre. Incorporated in India as United Spirits Limited (USL), the company is listed on both the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) in India.
For more information about Diageo India, our people, our brands, and our performance, visit us at www.diageoindia.com. Visit Diageo’s global responsible drinking resource, http://www.DRINKiQ.com, for information, initiatives, and ways to share best practices.
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Cautionary statement concerning forward-looking statements
This document contains ‘forward-looking’ statements. These statements can be identified by the fact that they do not relate only to historical or current facts. In particular, forward-looking statements include all statements that express forecasts, expectations, plans, outlook and projections with respect to future matters, including trends in results of operations, margins, growth rates, overall market trends, the impact of changes in interest or exchange rates, the availability or cost of financing to United Spirits Limited (“USL”), anticipated cost savings or synergies, expected investments, the completion of USL’s strategic transactions and restructuring programmes, anticipated tax rates, expected cash payments, outcomes of litigation, anticipated deficit reductions in relation to pension schemes and general economic conditions. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including factors that are outside USL’s control. USL neither intends, nor assumes any obligation, to update or revise these forward-looking statements in the light of any developments which may differ from those anticipated.