Britannia Q2 net profit up 16% on brand investments, widening distribution

Food company Britannia Industries on Monday posted a 16 per cent growth in consolidated net profit for the quarter ended September to Rs 3 billion, as compared to the corresponding quarter a year ago, primarily on brand investments and widening of its distribution network.   

The Bengaluru-based company reported a consolidated revenue growth of 13 per cent for the period to Rs 28.5 billion, in line with industry estimates.

"This was the fourth successive quarter of double-digit volume growth, primarily due to our investment in brands, multi-media campaign to bring alive the new identity and celebrating 100 years, and widening our distribution network through focus on direct reach, rural market and weak states," said Varun Berry, managing director, Britannia Industries.

Britannia's profit from operations increased 21 per cent yoy to Rs 4.17 billion.

On the manufacturing front, the first line of the company's Ranjangaon integrated food park near Pune became commercialised. It will be producing biscuits followed by other lines, which will manufacture cakes, croissants and dairy products.  

The Rs 100-billion firm continued its premiumisation and innovation journey and launched Pure Magic Chocolush, Good Cashew Almond and Tiger Choco Cookies during the quarter. It also renovated 50-50 and Bourbon.

In line with its goal to become a total foods company, the maker of Good Day biscuits launched two new products -- cream wafers and flavoured milk shakes in tetra packs. Some of the categories that Britannia will enter into in the next six to eight months include centre-filled croissants, swiss rolls, and muffins. The company already has a joint venture with Athens-based baking major Chipita for its foray into croissants.