Conference Call with Varun Beverages Management and Analysts on Q3FY22 Performance and Outlook. Listen to the full earnings transcript.
Varun Beverages declares Q3FY22 result: Q4 CY 2021: Net Revenue grew 30.3% YoY to Rs. 17,343 mn EBITDA higher by 20.5% YoY to Rs. 2,076 mn\ PAT at Rs. 326 mn vs loss of Rs. 72 mn CY 2021: Net Revenue grew 36.8% YoY to Rs. 88,232 mn EBITDA grew 37.7% YoY to Rs. 16,546 mn PAT higher by 108.8% to Rs. 7,461 mn Commenting on the performance for Q4 & CY 2021 Mr. Ravi Jaipuria, Chairman, Varun Beverages Limited said, “We have ended the year on a strong and resilient note, delivering a top line growth of 37% in the year. The performance was driven by a robust volume growth of 34%. While the short-term disruptions due to the second wave of the pandemic severely impacted our domestic business in the seasonally strong month of May, our team was able to handle and mitigate the impact to a large extent based on learnings from last year. As restrictions started easing in the domestic market, we saw a fast recovery in demand, that brought back the growth momentum with which we started the year. Improved offtake across our international territories further aided growth during the year. We continue to sustain cost-optimisation measures that we had undertaken during the pandemic period. Despite decline in our gross margins due to higher pet prices, our cost optimization measures in combination, with a higher operating leverage on the back of strong volume growth has translated to enhanced operating performance in 2021. I am also pleased to share that even in a seasonally soft quarter we have reported profits for the first time ever in Q4 on account of these measures, increased operating leverage, improvement in profitability of international operations and lower financing cost. Financing cost came down significantly during the year led by lowering of average cost of borrowing. For the full year our PAT grew by 109% because of these measures and higher volume growth. On the whole, we have delivered an encouraging performance during the year. The third wave of Covid has not had any significant impact on our business and we will continue to further strengthen our distribution in under-penetrated territories, enhancing volumes, and increasing our market share. We are confident of delivering a much stronger performance going forward.” Result PDF
Conference Call with Varun Beverages Management and Analysts on Q2FY22 Performance and Outlook. Listen to the full earnings transcript.
Highlights Q3 CY2021: Revenue grew 33% YoY to Rs. 23,982 mn EBITDA higher by 30% YoY to Rs. 4,947 mn PAT higher by 60% YoY to Rs. 2,579 mn 9M CY2021: Revenue higher by 39% YoY to Rs. 70,889 mn EBITDA grew 41% YoY to Rs. 14,471 mn PAT higher by 96% to Rs. 7,135 mn Revenue from operations (net of excise / GST) grew by 33.0% YoY to Rs. 23,981.6 million during Q3 CY2021, primarily on account of robust volume growth over last year and higher realization on a consolidated basis. Realization per case improved by 3.6% to Rs. 156.4 per case in Q3 CY2021 driven by higher realizations in international territories Total sales volumes were up 28.4% YoY at 153.3 million cases in Q3 CY2021 as compared to 119.5 million cases in Q3 CY2020 EBITDA increased by 29.9% to Rs. 4,946.6 million from Rs. 3,807.9 million Gross margins declined by 278 bps YoY during Q3 CY2021 primarily because of increase in pet prices in India Healthy EBITDA margin at 20.6% in Q3 CY2021 despite lower gross margins as higher volumes assisted the Company achieve better operating leverage PAT increased by 59.7% YoY to Rs. 2,579.0 million from Rs. 1,614.7 million in Q3 CY2020 Finance cost in Q3 CY 2021 declined by 26.4% to Rs. 426.9 million from Rs. 579.6 million in Q3 CY2020 The Company continues to reduce its debt and lower its average cost of borrowing Revenue from operations (net of excise / GST) grew 38.5% YoY to Rs. 70,889.0 million as compared to Rs. 51,192.5 million EBITDA improved by 40.5% YoY to Rs. 14,470.8 million from Rs. 10,296.4 million PAT increased by 95.7% YoY to Rs. 7,134.6 million from Rs. 3,645.1 million Commenting on the performance for Q3 & 9M 2021 Mr. Ravi Jaipuria, Chairman, Varun Beverages Limited said, “We are delighted to share that we have reported a robust performance during the quarter, delivering a top line growth of 33% and a PAT growth of 60% YoY. The results were supported by strong volume growth of 28% driven by uptick in demand across markets. Even on a 2-year CAGR basis, our organic volumes were higher by 11%. Wide vaccination coverage in the country along with resumption in day-to-day activities supported demand momentum in the domestic markets. On the profitability front, we were able to maintain a healthy EBITDA margin of 21% during the quarter backed by higher operating leverage despite an increase in raw material prices. While the industry practice is that any input cost increase is passed on, we have also worked on our cost efficiencies. For example, we are undertaking measures to light weight PET preforms. This will not only assist us in reducing costs in the near-term, but the benefits would be structural in nature. We are continuously monitoring the input prices to sustain our margin that will enable us to further strengthen our position in the beverage industry. In addition, we continued to reduce our debt as well as rate of interest which helped us in improving our net profit margin during the quarter. Following easing of lockdown restrictions and improving macro trends, we witnessed enhanced traction in the domestic demand environment which exceeded pre-pandemic levels. Out-ofhome consumption registered an uptick driven by increase in travel and resumption in offices. On the whole, we remain optimistic on the demand environment, given improving macros, onset of festive season and a growing sense of normalcy across domestic and international markets.” Result PDF