United Spirits Q4 results: Net profit jumps six-fold to Rs 167 crore

Bengaluru: United Spirits Ltd (USL) on Friday posted a six-fold increase in fiscal fourth-quarter net profit from a year earlier when the country’s largest liquor company had incurred a high tax expense.

The company controlled by UK-based spirits and beer maker Diageo Plc posted a net profit of Rs 167.3 crore for the quarter through March.

Net sales rose 11.6% from a year earlier to Rs 2,224 crore, driven by continued momentum in demand at retail outlets, partly offset by contraction of its owned business in Andhra Pradesh and softer footfall in the on-trade channel such as bars and restaurants.

Net sales in its Prestige and Above segment – which has mid-segment and premium brands such as McDowell’s No 1, Royal Challenge, Johnnie Walker and Vat 69 – grew 25.8%, backed by strong demand for its Scotch portfolio, the company said.

Net sales in the Popular segment – which has mass-market brands such as Haywards, Bagpiper and White Mischief -- fell 3.1%, hurt by a decline of 4.3% in priority states. West Bengal sales saw a steep decline due to high taxes imposed.

"Top-line growth momentum returned, and our in-quarter performance was strong on both top line and Ebitda aided by the weak comparatives. Net revenue management, stable commodity prices (and) efficiencies from our productivity programme enabled us to deliver a healthy Ebitda margin of 18.5% in the fourth quarter,” Anand Kripalu, CEO of Diageo India, said in a filing to the BSE.

“Despite a challenging start to FY21 in the first quarter, our business withstood the disruption and showed progressive improvement thereafter with every passing quarter. Debt at the end of this fiscal stood reduced to Rs 556 crore, a reduction of Rs 1,517 crore from last fiscal end,” he added.

USL said it would not be immune to the volatile environment caused by the onset of the deadly second wave, but would remain focused on building the long-term health of its brands supported by data-led insights.

The company announced the quarter results after the market closed. Its stock closed almost flat at Rs 572 on the BSE Friday.