Britannia net profit ups 25% in Jan-March Quarter

Abetted by its widening distribution reach across the hinterlands, Indian leading cookie maker Britannia has reported a 25% rise in net profit in the fourth quarter.

Net profit rose to Rs 264 crore, for the quarter ended March 31, from Rs 210 crore, a year earlier. Revenue from operations rose 9.5% to Rs 2,537 crore. Margins rose more than 200 basis points to 15.3%.

Managing director Varun Berry said, “We have witnessed positive momentum in the market growth over the last few months. Our Double digit growth for the quarter is backed by a double digit volume growth on the back of investment in brands and widening our distribution network through focus on direct reach, rural market and weak states.”

The Bengaluru-based company now has access to 17 lakh direct outlets which has also helped it expand in the rural areas with a razor sharp focus in Rajasthan, Madhya Pradesh, Uttar Pradesh and Gujarat, where it lags behind its rivals, from a measly outreach to about 550,000 direct retail outlets five years back.

The maker of Bourbon and Good Day biscuits has stepped up its focus in the rural markets over the last few years to drive growth and sustain market share. It has also revamped its chocolate portfolio in Goodday with the launch of Choco Almond and Chocoships besides other launches.

International business grew in double digits despite a slow-down in many geographies like Middle East and Africa. While the growth in dairy business remained subdued, profitability improved considerably, the company said.

Key raw material prices saw moderate inflation in the quarter. Britannia will also focus on bridging portfolio gaps in its bakery business.