Avenue Supermarts Ltd, which owns and operates retail chain D-Mart, on Saturday reported 41.60 percent rise in consolidated net profit at Rs 271.28 crore for the fourth quarter ended March 31, 2020. The company had a net profit of Rs 191.57 crore in January-March a year ago, Avenue Supermarts said in a BSE filing.
According to a PTI report: Revenue from operations was up 23.59 percent to Rs 6,255.93 crore during the quarter under review as against Rs 5,061.65 crore in the year-ago period.
Total expenses were at Rs 5,957.53 crore as against Rs 4,767.21 crore, up 24.96 percent.
The company’s overall revenue grew 23 percent during the latest quarter. However, during March, it grew just 11 percent over the year-ago month due to lockdown, Avenue Supermarts said in a post earnings statement.
“The trend rapidly deteriorated in April during which more than half of our stores remained closed for operations or operated for extremely restricted hours,” it added.
In 2019-20, Avenue Supermarts logged a profit of Rs 1,300.98 crore, up 44.15 percent from Rs 902.46 crore in the previous year.
Revenue from operations in the last financial year was Rs 24,870.20 crore, up 24.32 percent as against Rs 20,004.52 crore in 2018-19.
Neville Noronha, CEO & Managing Director, Avenue Supermarts said overall, 2019-20 saw a healthy 24 percent revenue growth while PAT margins were in line with expectations.
“Our (Like for Like) LFL growth for FY2020 was 10.9 percent. Two reasons for this. One is that stores that are more than 5 years old grew at a rate lower than the previous year’s and most of the stores that are younger are peaking faster, even before they qualify for the 24 months LFL measurement,” he said.
The company has opened 38 new stores during 2019-20.
According to Avenue Supermarts, as lockdown continues further, it sees “reduced sales and lower footfalls” in its D-Mart stores.
“Reduction in variable costs will trail sales drop, abetted by higher cost of hygiene and sanitation at all our locations apart from higher absenteeism due to transport restrictions.
“The full extent to which the pandemic will impact our future financial results, will depend on upcoming developments, which are highly uncertain including any new information concerning the severity of the pandemic and the action to mitigate its spread as advised by local authorities,” it said.
Avenue Supermarts’ revenue for April was down by more than 45 per cent as compared to April 2019.
The margins have also seen an erosion as regulations did not permit the company to sell any Apparel and General Merchandise products, it said.
“Significantly large EBITDA declines are to be expected due to lower sales, lower gross margins, higher cost of operations on account of hardship allowance to front line staff during lockdown and higher personal hygiene/store sanitation cost,” the company added.