Bihar liquor ban pushes USL into Rs 104-cr Q4 loss

Country’s largest spirit maker United Spirits (USL), a Diageo Group company on Tuesday posted a net loss of Rs 104 crore for the fourth quarter as against the net profit of Rs 1.4 crore logged in the same quarter last fiscal.

Country’s largest spirit maker United Spirits (USL), a Diageo Group company on Tuesday posted a net loss of Rs 104 crore for the fourth quarter as against the net profit of Rs 1.4 crore logged in the same quarter last fiscal. Total income of the company stood at Rs 6485 crore during the quarter as compared to Rs 5937 crore, registering an increase of 8.62%.

In a statement to the stock exchanges, USL disclosed that the loss was due to some exceptional items including a 16% drop in sales. The EBIDTA was at Rs 265 crore up by 128% during the quarter, compared to same quarter last fiscal, due to lower operating expenses. EBIDTA margin was at 13.1%.

The popular segment represents 59% of total volumes and 42% of total net sales. The total popular segment declined both in volume and net sales by 16% in the fourth quarter impacted by Bihar prohibition and changes in operating model. Giving details on the new operating model USL said that it had entered into agreements to franchise certain popular segment brands in Andhra Pradesh and Goa.

Anand Kripalu, CEO, USL said: “We have faced challenges in the regulatory environment in certain states. Tax and excise levies in Maharashtra have led to sharp consumer price increases and the route market in Punjab continues to impact the performance. While the longer term consumer opportunity remains strong for spirits, we expect that the highway ban will continue to impact performance in short term.”

Courtesy: FE Bureau