 "United Spirits Q2 profit at Rs 929 cr on UB shares sale windfall")
United Spirits Ltd, majority owned by British liquor maker Diageo Plc, reported second quarter profits of Rs 929.3 crore on windfall of Rs 853.6 crores by selling shares of United Breweries held by the company. During the July to September quarter last year, USL reported a loss of Rs 26.9 crore.
Revenue stood at Rs 2151.5 crore, an increase of 4.4% over Rs 2061.5 crore in the samer period last year. The standalone results of USL were unaudited.
USL said it has appointed former Ambuja Cements chief financial officer Sanjeev Churiwala as its CFO, replacing Vinod Rao, finance director Diageo's Asia Pacific arm who was an acting finance head.
In a statement, USL said the company's sales grew six% in the second quarter and eight% in the first director.Gross margins were up by 39% to Rs 520 crore due to higher sales of premium products in the country.
"Our F16 half year results are starting to show the dividends of our comprehensive strategic plan focused behind our power brands with a clear prioritized geographical participation strategy. The divestment of the UBL shares during the quarter has generated Rs.870 Crore of free cash that has been used to retire debt and has reduced our net debt position to less than Rs 4,000 Crore from over Rs 5,000 Crore six months ago," said Anand Kripalu, CEO in a statement.
The "Prestige and Above" growth of 16% in the half and the resultant positive mix underpins our focus on our premiumisation strategy and the benefit of the full Diageo brands integration into our portfolio.
Our renovations strategy on our core brands has commenced with encouraging results from the re-launch of our Royal Challenge brand (49% volume growth in the last six months) and we look forward to the McDowell's No.1 re-launch that is currently underway, he said.
"We have however faced challenges in the last three months including specific industry challenges in states such as Uttaranchal and Chhattisgarh plus a temporary pricing related challenge in Karnataka on our lead brand of Haywards. The highly regulated environment in respect of pricing remains a key challenge for the industry as a whole and needs to be remedied," Kripalu said.
United Spirits stock saw 2.47 times spurt in volume as it closed Rs 98.15 or 3. 11% higher to RS 3250.20 on Monday. The BSE Sensex closed 97.68 points or 0.37% lower to 26,559.15.
