DMart Q1 net profit tumbles 88% to Rs 40 cr due to Covid-19 lockdown

Owner of Avenue Supermarts reported a profit of Rs 323 crore in the same quarter last year

Avenue Supermarts Ltd, which owns and operates DMart stores across the country, on Saturday reported 87.61 per cent year-on-year fall in its consolidated net profit at Rs 40 crore for the April to June quarter.

It had reported a profit of Rs 323 crore in the same quarter last year. The profit after tax margin stood at 1 per cent in Q1 FY21 as compared to 5.5 per cent in Q1 FY20.The chain of hypermarkets said its consolidated total revenues fell to Rs 3,883 crore from Rs 5,815 crore in the year-ago quarter.

"Covid-19 continued to spread across the country. The ensuing restrictions have had a significant impact on our operational and financial performance in the quarter," said CEO and Managing Director Neville Noronha.

"Our revenue, EBITDA and profit for the quarter were significantly lower as compared to the same quarter last year," he said in a statement.

DMart said that wherever stores were allowed to operate unhindered it saw recovery at 80 per cent or more of pre-Covid sales. But discretionary consumption continues to be under pressure, especially in the non-FMCG categories.

"This is impacting the gross margins negatively. Store operations and duration of operation per day continue to remain inconsistent across cities due to strict lockdowns enforced by local authorities from time to time," said the company.

"In addition, in certain cities, authorities are once again insisting on selling only essential products. Hence our future revenues continue to remain uncertain."

Avenue Supermarts has 216 stores with the retail business area of 80 lakh square feet across Maharashtra, Gujarat, Daman, Andhra Pradesh, Karnataka, Telangana, Tamil Nadu, Madhya Pradesh, Rajasthan, NCR, Chhattisgarh and Punjab.

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