United Spirits Q3FY23 net profit drops by 27 percent

Indian alcoholic beverage maker United Spirits Ltd on Tuesday reported a 64.4% slump in quarterly profit, hurt by soaring input costs, falling sales and a one-time expense.

The maker of Johnny Walker whiskey reported a profit of 1.11 billion rupees ($13.61 million) in the quarter ended Dec. 31, down from 3.11 billion rupees in the previous year. The sector has been grappling with high cost of extra neutral alcohol and soda ash. Meanwhile, bottle prices have spiked due to inflation in natural gas required for glass production.

The Bengaluru-based scotch maker’s revenue fell 25% to 66.12 billion rupees in the quarter, while net sales fell nearly 10% to 2.78 billion rupees. The company said it incurred a one-time expense of 1.51 billion rupees, while its input costs rose 4.6%.

“Looking ahead, in the shorter term, we do expect inflationary headwinds to continue,” said Hina Nagarajan, chief executive of United Spirits. The Diageo PLC-backed company had sold 32 brands in May last year, including Haywards and Old Tavern, to Inbrew Beverages on a slump sale basis.