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Q1-FY09 Results Update - Temptation Foods 1 August 2008 Source: www.keynoteindia.net
Results y-o-y - Topline and bottomline grew by 1059.5% and 327.1% respectively because of acquisition of Everfresh, KGK and marine business in Q3-FY08. - Cost of raw materials (as % of sales) increased from 63.2% to 83.6%, on account of higher raw material costs for branded as well as marine business. - EBITDA margins declined sharply from 20.3% to 7.7%, mainly due to the high revenue share of the low-margin marine business, which TFL entered into in Dec 07. Marine segment has lower margins of 3%, vis-?-vis 10-15% for private labels and branded products. Sequential (q-o-q) Results - Topline and bottomline declined by 21.9% (due to seasonality) and 7.2% respectively. Better realizations in marine and Everfresh were however offset by the sharp rise in costs, impacting the bottomline. The costs could not be passed on to customers. - EBITDA margins grew marginally from 7.1% to 7.7%. This is largely because of the slowdown in the low-margin marine segment, on account of the monsoon. Revenue share of marine business declined from 67.3% in Q4-FY08 to 59.6% in Q1-FY09. Going forward, the management expects the contribution of the marine segment to further decline to 45% of total revenues. - Profit after tax declined by 7.2% because of the reduced topline and the rise in the interest costs. Recent Developments - KGK shifted production to a dedicated facility at Nira, near existing plant at Jejuri to maintain operational synergies. It launched new ‘premium’ branding and packaging initiative. - Private Label business added new customers from Europe. - Everfresh aims to double output by the end of the year to 15,000 tons. Acquisition & funding plans TFL plans to raise Rs8bn via a QIP is on track and will be completed in the near future. It has identified several acquisitions for the same. |
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