Aditya Birla Fashion and Retail posts strong business performance in a tough market, H1 PBT more than doubles

12 November, 2019

Standalone financials

In Rs. Cr. Q2 FY19 Q2 FY20 (Comp.) Growth Q2 FY20 (Ind AS Adj.)
Revenue 2007 2297 14% 2297
EBITDA 162 177 10% 362
PBT 43 59 39% 36

In Rs. Cr. H1 FY19 H1 FY20 (Comp.) Growth H1 FY20 (Ind AS Adj.)
Revenue 3921 4363 11% 4363
EBITDA 284 334 18% 694
PBT 48 112 132% 71

Performance summary

The Board of Directors of the company at its meeting today have approved the results for the quarter ended 30 September 2019. These financials are after accounting for necessary adjustments pertaining to Ind AS 116.

In Q2 FY20, the company posted a strong 14 per cent growth in sales to Rs.2,297 crore. This was accompanied by a robust 10 per cent growth in EBITDA to Rs.177 crore this year, on a comparable basis. At the same time, reported EBITDA (post Ind AS 116) for the quarter was at Rs.362 crore. The comparable net profit for Q2 FY20 is Rs.30 crore.

For the first half of this fiscal, the company recorded sales growth of 11 per cent at Rs.4,363 crore. The comparable EBITDA for the period grew by 18 per cent to Rs.334 crore with margins expanding from 7.2 per cent in H1 FY19 to 7.6 per cent in H1 FY20. During the period, the company posted 132 per cent increase in its comparable PBT at Rs.112 crore from Rs.48 crore last year. The comparable net profit for the period is Rs.70 crore.

Business segment highlights

Madura segment:

Madura business segment consists of Lifestyle brands – Louis Philippe, Van Heusen, Allen Solly and Peter England, Fast Fashion brands – Forever 21 and People and Other businesses that include Global brands, Innerwear and newly invested business in Ethnic, viz. Jaypore and Shantanu & Nikhil. The consolidated financials include the financials of both these businesses.

Madura segment recorded 16 per cent growth in revenue in Q2 FY20 at Rs.1,463 crore as compared to Rs.1,263 crore in the same period last year, with a 20 per cent growth in comparable EBITDA.

  • Lifestyle brands reported a 15 per cent jump in sales driven by exceptional growth in its new initiatives around women and kids wear businesses. The revenues for the period grew from Rs.1,090 crore last year to Rs.1,254 crore in the same period this year, amidst difficult market conditions. The business witnessed a 12 per cent YoY increase in comparable EBITDA at Rs.158 crore.
    For H1 FY20, the reported revenues grew 11 per cent YoY to Rs.2,259 crore while comparable EBITDA for the business grew at 16 per cent to Rs.252 crore over the same period last fiscal.
  • Fast Fashion continues to operate on a calibrated business model. While People brand is gradually moving into Pantaloons, Forever 21 continues to run prudent operations with a focus on enhanced profitability.
  • Other Businesses rapidly scaled up with individual sub-segments viz. Innerwear and Global brands displaying a robust growth trajectory. The segment recorded a strong YoY growth of 59 per cent in revenue to Rs.134 crore in Q2 FY20. For the first half of this financial year, the segment grew 67 per cent in sales to Rs.259 crore.
    • Innerwear business progressed on its aggressive growth trajectory with the launch of newer categories and styles, along with the expansion of its distribution network, which stands at ~18,000 outlets at the end of this quarter.
    • Global brands grew fast, with strong same store sales growth across all portfolio brands.

Pantaloons segment:

Pantaloons recorded a robust 16 per cent growth on the back of strong LTL of more than 10 per cent and rapid store expansion, despite difficult market conditions. Pantaloons segment reported revenue of Rs.915 crore for the quarter as against Rs.787 crore in Q2 FY19. This was driven largely by a superior product offering and intensified brand building. These initiatives have helped achieve 23 per cent growth in comparable EBITDA at Rs.64 crore.

For H1 FY20, Pantaloons delivered a growth of 13 per cent in sales to Rs.1,805 crore, with EBITDA margins expanding from 8.1 per cent last year to 8.4 per cent this year.

Outlook

Aditya Birla Fashion and Retail Limited operates a well-diversified portfolio of very strong brands spread across varied segments, price points and wearing occasions. The company is confident of continuing its market-leading performance on the back of wide distribution network, high quality talent and credible leadership team.

About Aditya Birla Fashion and Retail Limited

Aditya Birla Fashion and Retail Limited is India's largest pure-play fashion and lifestyle company with a strong bouquet of leading fashion brands and retail formats. The company has a network of 2,875 stores, presence across approximately 22,000 multi-brand outlets with 5,400+ point of sales in department stores across India.

Disclaimer : Certain statements in this "Press Release" may not be based on historical information or facts and may be "forward looking statements" within the meaning of applicable securities laws and regulations, including, but not limited to, those relating to general business plans & strategy of the Company, its future outlook & growth prospects, future developments in its businesses, its competitive & regulatory environment and management's current views & assumptions which may not remain constant due to risks and uncertainties. Actual results could differ materially from those expressed or implied. The Company assumes no responsibility to publicly amend, modify or revise any statement, on the basis of any subsequent development, information or events, or otherwise. This "Press Release" does not constitute a prospectus, offering circular or offering memorandum or an offer to acquire any shares and should not be considered as a recommendation that any investor should subscribe for or purchase any of the Company's shares. The financial figures in this "Press Release" have been rounded off to the nearest Rs. one Crore. The financial results are consolidated financials unless otherwise specified.

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