United Spirits Ltd, the country’s largest liquor company, reported a 384% increase in net profit for the quarter ended June, while sales rose 16% (consolidated basis) on a low base last year and higher sales of premium brands and one-off expenses in the prior year.
The company that sells brands including Johnnie Walker and McDowell’s, saw premium brands grew 44% and, accounted for 71% of its overall revenue, while sales of popular or mass-priced products expanded by 13%. The company said double-digit top-line growth reflects strong consumer demand in off-trade, recovery in the on-trade channel, active portfolio management and benefit from the soft comparator.
“We have delivered another quarter of steady performance in a challenging operating environment. Our business today is ahead of pre-pandemic levels, substantiating the resilience of our category. Double-digit inflation, scotch supply constraints in select markets and a one-time special grant to our people in recognition for the outstanding contribution in extremely challenging times, impacted the EBITDA margin delivery,” said Hina Nagarajan, chief executive officer at USL. “Looking ahead, in the shorter term, we expect inflationary pressures to continue.”
Gross profit margins fell by 370 basis points to 40.9%. In May, USL announced it will sell 32 brands, including Haywards, Old Tavern and White-Mischief for Rs 828 crore to Inbrew with a five-year franchise arrangement for 11 other brands, including Bagpiper and Blue Riband.