Aditya Birla Fashion Q4 Results: Reports Surprise Profit, Lifestyle Brands Drive Sales

Aditya Birla Fashion and Retail Ltd. has reported surprise profit in the quarter ended March, driven by sales of lifestyle brands, including Allen Solly, Louis Philippe, Peter England and Van Heusen.

Net profit of the company, which operates Madura Fashion and Lifestyle and Pantaloons, stood at Rs 31.9 crore against a net loss of Rs 195.9 crore a year earlier, according to its exchange filing. That compares with the Rs 29-crore net loss estimated by analysts tracked by Bloomberg.

For the full fiscal, the company reported a net loss of Rs 118.4 crore. It closed the quarter with a net debt of Rs 504 crore.

Highlights (YoY)

• Revenue rose 25% to Rs 2,282 crore compared with the estimate of Rs 2,403.1 crore.

• Operating profit rose 59% to Rs 373 crore against an estimate of Rs 288.9 crore.

• Margin stood at 16.3% versus 12.9%. Analysts had projected it at 12%.

• Cost of materials rose 94% to Rs 319.4 crore.

“The onset of wave 3 had an effect in the early part of the fourth quarter,” the company said in a statement.

However, the business saw a strong rebound with March seeing a sales growth of 50% over last year, it said. “We expect this momentum to continue in the coming quarters of FY23 as well.”

Segment-wise, Pantaloons' revenue rose 13% to Rs 674.9 over a year earlier despite disruption in large-format stores due to the third wave of Covid-19, the company said. “The e-commerce channel grew 81% year-on-year, with Pantaloons.com growing by 63% over last year.”

The segment, however, widened its net loss before tax to Rs 33.2 crore from Rs 22.5 crore.

It also opened 18 Pantaloons stores during the quarter.

As on March 31, the company had a network of 3,468 stores across 28,585 multi-brand outlets in India. The e-commerce channel, according to the company, is currently operating at an annual revenue of Rs 1,000 crore.

Madura Fashion and Lifestyle, which includes the brands Allen Solly, Louis Philippe, Peter England and Van Heusen, among others, saw a revenue growth of 32% to Rs 1,660.1 crore. Its profit rose to Rs 160.3 crore compared with Rs 20.5 crore a year earlier.

“The business continued its expansion into smaller town markets,” according to the company. Its Ebitda grew 77% on the back of revival of wholesale business and a strong like-to-like growth—stripping out effects of expansion and shop closures—of 13%.

Among other businesses, the company said, the inner wear and athleisure segment saw “consistent growth” over the last few quarters driven by distribution expansion through trade and e-commerce.

The youth fashion segment, consisting of American Eagle and Forever 21, recorded “strong” growth in the year.

Super premium brands, including The Collective and Mono, also maintained their “excellent” growth trajectory during this year, almost doubling in size over the pre-Covid period.

The ethnic business, it said, also showed “sharp” growth in revenue, with scale coming from both network expansion, new portfolio additions and category extensions. The business is currently operating at an annual run rate of Rs 400 crore, according to the company.

Shares of Aditya Birla Fashion rose 0.25% after the results were announced compared with losses for the benchmark Nifty 50. In the last one month, shares of the company fell 3.9%.