Tata Global Breverages' second quarter consolidated net profit rose 49% YoY to Rs 77 crore, helped by strong sales across global markets and price hikes taken in India.
Lower exceptional expenses and reduced interest cost also boosted profits in July September. The company’s total operating income in the second quarter was up 12% to Rs 1,630 crore.
During the quarter, TGB’s interest cost reduced to Rs 3.15 crore from Rs 14.38 crore a year ago due to restructuring of high cost debt. It also had lower exceptional cost of Rs 10.47 crore in July-September related to redundancy cost, business restructuring and long-term initiatives. In the year ago quarter, it had exceptional cost of Rs 32.38 crore.
“The group’s consolidated net profit is significantly higher than the year ago quarter mainly due to improved operation performance, favorable impact of exceptional items and lower interest cost, which partially offset commodity cost increases,” said managing director Percy Siganporia.
The company’s profit from operations before other income, interest and exceptional item rose to Rs 112.48 crore from Rs 104.11 crore. Raw material cost in the second quarter rose to Rs 706.38 crore compared with Rs 510.93 crore a year ago. Tea prices have remained firm in most markets and coffee prices also remained high YoY, although, they are down from an earlier high, he said.
TGB raised product prices in India in June-July to offset some of the cost increases. The company now sees raw tea prices easing over the next few months. But Siganporia said, prices of African tea remain high due to increase demand from Middle East and Russia.
In India, TGB said, it retained a volume leadership with a share of 19.7% while it is also gained value leadership with a share of 21.5%.
Separately, on Friday, TGB named Ajoy Mishra as its executive director. He will be based in UK and have additional responsibility of overseeing global beverage operations as deputy CEO. Mishra earlier was handling sales and marketing at another Tata group company – Indian Hotels.
Source: www.moneycontrol.com
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