Varun Beverages Q1 consolidated net profit up by two folds at Rs 319 cr

Varun Beverages Ltd, on Monday reported over two-fold jump in consolidated net profit at Rs 318.80 crore for second quarter ended June 30, 2021, helped by volume growth and cost-optimization measures.

Varun Beverages Ltd, PepsiCo's largest franchise bottler, on Monday reported over two-fold jump in consolidated net profit at Rs 318.80 crore for the second quarter ended June 30, 2021, helped by volume growth and cost-optimization measures.

The company, which follows January-December financial year, had posted a net profit of Rs 142.87 crore in April-June period a year ago.

Revenue from operations during the quarter under review stood at Rs 2,483.04 crore, up 49.06 per cent from Rs 1,665.69 crore in the year-ago period, Varun Beverages Ltd (VBL) said in a regulatory filing.

Total expenses were at Rs 2,087.79 crore as against Rs 1,486.49 crore in the second quarter of 2020.

VBL Chairman Ravi Jaipuria said the company delivered an encouraging set of results during the quarter despite a soft operating environment due to the pandemic-induced lockdowns and restrictions.

"While we registered strong sales in the month of April, May witnessed moderate sales on account of the disruptions... Further, as lockdowns and curbs started easing from June onwards, we saw faster recovery in demand, which assisted growth in the quarter. Overall, we have delivered a healthy performance, with a topline growth of 49.4 per cent year-on-year," he said.

He further said the higher growth rate is on account of "robust volume growth over a lower base of previous year as well as a marginal increase in realizations".

"On the profitability front, we were able to maintain most of the cost-optimization measures that we had undertaken last year, allowing us to report stable EBITDA margin at 23.3 per cent. PAT increased by 123 per cent, primarily driven by lower finance cost on account of lowering of average cost of borrowing and reduction in total debt," Jaipuria said.

In a separate filing, VBL said its board in a meeting held on Monday recommended an interim dividend of Rs 2.50 per equity share for financial year 2021 on equity shares of the nominal value of Rs 10 each.

The company also informed about the appointment of Rajesh Chawla as CFO with immediate as the current CFO resigned due to role enhancement.

"Pursuant to the recommendation of Nomination and Remuneration Committee and Audit, Risk Management and Ethics Committee, Rajesh Chawla is upgraded as Chief Financial Officer(CFO) and Key Managerial Personnel of the company with immediate effect in place of Vikas Bhatia," it added.

VBL stock was trading at Rs 789.60 on BSE, up 3.68 per cent from the previous close.