Aditya Birla Fashion and Retail Ltd (ABFRL) released its fiscal second quarter earnings with a loss of Rs 214.70 crore in comparison to a loss of Rs 200.34 crore recorded during the corresponding quarter of previous year. It posted revenue from operations at Rs 3,643.86 crore, registering a growth of 12.9 per cent as against Rs 3,226.44 crore during the same period of previous financial year. The company EBITDA stood at Rs 361.4 crore, up 11.8 per cent on-year. “Businesses achieved consistent growth this quarter, despite a subdued consumption environment, driven by sustained focus on driving product enhancements, elevated customer experiences and brand refresh,” the company said in a regulatory filing.
Consolidated net profit, the company said, was impacted on account of higher depreciation/amortization for brand and retail assets due to inclusion of TCNS and higher interest costs on account of elevated borrowings.
“Growth was largely led by newer businesses operating in emerging consumer segments, while our established brands continued with their growth trajectory with a clear focus on improved profitability. While Aditya Birla Lifestyle Brands Limited (ABLBL) reported sustained margins, the demerged ABFRL posted a sharp recovery in margins across its constituent businesses,” it said.
Q2 performance across businesses
Proposed Aditya Birla Lifestyle Brands Limited (ABLBL):
• Lifestyle brands – Louis Philippe, Van Heusen, Allen Solly, Peter England, Simon Carter
• Youth Western wear Brands – American Eagle & Forever 21
• Sportswear brand: Reebok
• Innerwear business under Van Heusen
The company said that the lifestyle category revenue stood at Rs 1636 crore, registering a growth of 3 per cent over last year. EBITDA for the business was Rs 302 crore resulting in an EBITDA margin of 18.4 per cent. Retail LTL for the quarter was at 3.4 per cent, driven by well-rounded improvements across products (casualisation, younger fashion) and enhancement of in store experience.
Further, it said that the emerging growth businesses which include youth western wear, innerwear & athleisure and sportswear segments posted 7 per cent growth at an overall level with the segment posting another quarter of positive EBITDA.
Proposed De-merged Aditya Birla Fashion & Retail Limited (ABFRL):
• Masstige & Value Retail play under Pantaloons & Style Up
• Ethnic Brands –
o Designer led brands of Sabyasachi, Shantnu & Nikhil, House of Masaba and Tarun Tahiliani
o Premium ethnic wear brands of Jaypore, Tasva & TCNS portfolio
• Luxury Retail –
The Collective & Mono brands portfolio, Galeries Lafayette
• TMRW
The company said that Pantaloons segment posted quarterly sales of Rs 1082 crore, growing 3 per cent vs LY. Led by gross margin improvement, EBITDA grew 65 per cent YoY and margin expanded by 560 bps to reach 15.0 per cent in Q2. Style Up expanded its network by adding 5 stores, bringing the total to 35 stores, as it continues to improve performance metrics across the network.
Ethnic Brands
• Designer led brands: The designer led ethnic portfolio grew by 32 per cent on YoY basis led by addition of GFPL. House of Masaba recorded 123 per cent revenue growth vs LY, as the beauty business grew to ~10x of LY driven by robust distribution expansion and strong organic sales via its website.
• Premium ethnic wear brands: TCNS revenue in Q2 stood at Rs 254 crore propelled by steady improvements in store throughput and a positive response to its newly launched merchandise. The men’s premium ethnic wear brand TASVA’s sales were up 79 per cent vs LY on the back of strong start to festive season, driven by its strong product offerings and differentiated in store experience. Brand Jaypore’s revenue grew 15 per cent YoY led by strong LTL and distribution expansion.
Luxury Retail, comprising the multi-brand format “The Collective” and other mono brands maintained profitable growth, with a YoY revenue increase of 9 per cent. The total network now encompasses 40 stores.
TMRW portfolio grew to more than 2 times of LY driven by its strategic playbook of building digital-first brand portfolio.
From: financialexpress
Financial News
