Net sales

United Spirits third quarter profit rises 27% to Rs 291 crore, net sales up 7.6% to Rs 8,854.5 crore

The company recorded a net profit of Rs 229.9 crore in the October-December period a year ago, United Spirits Ltd (USL) said in a regulatory filing.

Diageo-controlled liquor maker United Spirits Ltd on Tuesday reported a 26.62% increase in its consolidated net profit to Rs 291.1 crore for the third quarter ended December 2021.

The company recorded a net profit of Rs 229.9 crore in the October-December period a year ago, United Spirits Ltd (USL) said in a regulatory filing.

Its operating income increased by 7.64% to Rs 8,854.5 crore from Rs 8,226 crore in the corresponding period of the previous fiscal year.

Hina Nagarajan, CEO of Diageo India, said: “We had a solid quarter, continuing the growth momentum amid rising inflation. The widespread growth of the Prestige & Above segment demonstrates the strength of our portfolio and the continued agility and resilience of the team. USL’s Prestige & Above segment net sales increased 20% with strong double-digit growth in its scotch portfolio.

However, net sales of its “popular segment” fell 1.7%, while priority states were flat.

“Gross margin was 44.1%, down 49 basis points on a reported basis, due to input cost inflation, partially offset by a favorable product mix and productivity gains . Adjusting for the one-time bulk scotch sale, underlying gross margin was 44.3%, down 31 basis points,” USL said in a post-earnings statement.

Total expenditure stood at Rs 8,463.8 crore, up by 6.58% from Rs 7,941.3 crore.

“Healthy operating cash flow enabled us to achieve debt-free status as of December 31, 2021,” she added.

Crisil upgraded its rating on USL’s long-term bank facilities to “AAA/Stable” while reaffirming its “A1+” rating on short-term bank facilities, Nagarajan added.

On the outlook, she said, “the near-term external operating environment will remain challenging, including the potential impact of Covid-19 and rising cost inflation.” “We continue to work with agility and remain focused on strengthening our portfolio while driving productivity across the value chain. We remain confident in the potential of the market and continue to remain focused on our strategic priorities to drive long-term value creation for all of our stakeholders,” added Nagarajan.

Shares of United Spirits Ltd stood at Rs 876.05 on BSE on Tuesday, up 2.73% from the previous close.

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