Arvind Fashions Limited (AFL), India’s leading multi-brand casual wear and denim fashion company, has declared its financial results for the fourth quarter and full year ended March 31, 2021.
Q4 FY21 revenue grew by 14% with marginally positive like-to-like store sales. This was driven by strong recovery across the channels and increased footfalls in the stores. It was further aided by continued traction in the online channel, the company said in its earnings statement.
Power brands posted growth of 17% with significantly improved profitability on Y-o-Y and Q-o-Q basis. USPA and Tommy Hilfiger sales recovery was strongest at 125%, with Sephora sales recovery at 114% led by both offline & online channels during the quarter.
“The balance sheet has been strengthened compared to Mar’20 with gross and net working capital reduction by Rs 523 cr and Rs 172 cr, respectively, in FY21 through sharper controls around inventory and debtors and new ways of buying,” the company stated.
Significant investments into omni-channel and digital solutions are yielding great results. Overall online channel sales increased four-fold YoY in Q4 FY21, while Direct to consumer online sales witnessed 3.6 times growth over last year.
“About 25% of the revenue growth was accounted for by online sales,” Shailesh Chaturvedi, MD & CEO, Arvind Fashions Ltd told Indiaretailing.
Strong sales growth coupled with efficient cost management enabled the company to deliver 98% growth in EBITDA for continuing business at Rs 97 cr in Q4 FY21 compared to Rs 49 cr in the corresponding quarter of FY20.
Cost reduction by 40% (amounting to Rs 540 cr) for the year helped counter some of the severe adverse impacts of the Covid-19 pandemic on profitability, the company said.
“We’re very encouraged by the strong sales recovery in H2, for our six high conviction brands in the portfolio when Covid-19-related lockdowns eased. This coupled with cost optimization efforts led to significant improvement in our bottomline,” Chaturvedi said.
“What is clear is that the key to future relevance — and profitability — lies in the digitalisation of fashion retail. Omnichannel accessibility — and experiences — will be vital to keep customers engaged,” he concluded.