Packaged Foods company Prataap Snacks declares Q3FY22 result: In Q3 FY22: Healthy Revenue Growth of 14% on a YoY Basis PAT Grows 4% on a YoY Basis Revenue of Rs. 3,849.5 million, registering a growth of 13.5% YoY Operating EBITDA of Rs. 181.1 million, translating to a margin of 4.7% PAT* stood at Rs. 47.4 million, higher by 4.1% YoY EPS* (Diluted) stood at Rs. 2.02 per share In 9M FY22: Revenue of Rs. 10,351.6 million, registering a growth of 20.2% YoY Operating EBITDA of Rs. 533.7 million, translating to a margin of 5.2% PAT* improved to Rs. 180.7 million, higher by 157.0% YoY EPS* (Diluted) stood at Rs. 7.70 per share Commenting on the Q3 & 9M FY22 performance, Mr. Amit Kumat – MD & CEO, Prataap Snacks Limited said; “We continue to rebuild our growth trajectory and have delivered an improved performance against the backdrop of gradual normalisation in the overall consumption environment. Revenue growth was healthy at 14% YoY driven by improved volumes which have surpassed pre-covid levels across most of the products categories. During the quarter, we have received approval from the Government of India under PLI scheme for expansion in food processing under the readyto-eat category. Our investment commitment aggregates to ~ Rs.105 crore, of which we have already invested Rs. 15 crore with the balance to be invested between us and our contract manufacturing partners before March 2023. This will enhance our capacities and further strengthen our manufacturing footprint. Operational challenges remain with palm oil prices remaining elevated during the quarter. In addition, there was a notable increase in the prices of laminates, which is a key raw material for our packaging process. Our cost optimisation programmes and implementation of the direct distribution model has enabled us to significantly mitigate the inflationary cost pressures. In Q3 FY22, our profitability was impacted by an exceptional expense of Rs. 14 crores, on account of loss caused by a fire at our Kolkata plant. The insurance claim is in process, and we expect to substantially recover this loss once the claim is settled in the coming quarters. We did witness some disruptions on account of increasing restrictions from the third wave of Covid, but we are now seeing an easing of restrictions in most states. With our focus on direct distribution and tele-calling aiding an increased and more efficient footprint we are well-positioned to grow topline while cost reduction initiatives are contributing to the structural improvement in margins. With a wide product range and robust balance sheet we remain confident of delivering sustainable growth over the medium term”. Result PDF
Highlights: Q2 FY22: Revenue of Rs. 3,705.8 million, registering growth of 13.4% YoY Operating EBITDA of Rs. 241.8 million, translating to a margin of 6.5% PAT stood at Rs. 146.9 million with margins at 4.0% EPS (Diluted) stood at Rs. 6.26 per share H1 FY22: Revenue of Rs. 6,502.0 million, registering growth of 24.5% YoY Operating EBITDA of Rs. 352.6 million, translating to a margin of 5.4% PAT stood at Rs. 131.0 million with margins at 2.0% EPS (Diluted) stood at Rs. 5.58 per share Commenting on the Q2 & H1 FY22 performance, Mr. Amit Kumat – MD, Prataap Snacks Limited said; “I am pleased to share that we have delivered growth of 13% in revenues during the quarter. As economic activities have regained momentum, we witnessed healthy recovery across several product categories with sales volumes surpassing pre-Covid levels. Our distribution channels have now normalised as restrictions in most parts of the country have eased considerably, except reopening of primary schools. This has led to a smart recovery in impulse purchases resulting in higher volumes for most of our products. Rings which is primarily consumed by children has witnessed improvement both on a QoQ and YoY basis but is yet to achieve its pre-covid levels. We have witnessed a sharp rise in input prices and transportation costs which have contributed to cost pressures. Prices of palm oil, which we had indicated in the previous quarter, remain elevated. In addition to this, we are witnessing escalation in other materials such as packaging film and corrugated boxes. Higher sales volume this quarter, improved distribution efficacy on account of tele-calling as well as gains from the progressive implementation of direct distribution have helped to counter the adverse impact on margin. We have taken several initiatives to grow our topline and strengthen our margins in adverse conditions and we are well placed to benefit from economic recovery. Further, our cost mitigation efforts will ensure sustained benefits even beyond reversal of increased inputs costs. With CAPEX initiatives in place and a strong balance sheet position we are in a healthy position to deliver sustained growth and value addition over the medium to long term”. Result PDF