Tata Global Beverages reports consolidated net profit at Rs 142 crores

For the quarter, revenue from operations at Rs 1704 Crores grew by 1% in underlying terms. Sales growth during the quarter was muted due to introduction of GST in India and phasing of promotions in developed markets.

Profit before exceptional items at Rs 218 Crores is higher by 9% as compared to the corresponding quarter of the previous year reflecting good cost management, lower commodity and finance costs partially offset by higher advertising spends.

The Group’s consolidated net profit for the quarter at Rs 142 Crores increased by 19% due to improved operating performance, higher exceptional income and lower losses from its Joint Ventures and Associates. The company’s Joint Ventures had a strong quarter with a turnover growth in excess of 20%.

TGB has decided to restructure its operating model in Russia by entering into an agreement to transfer ownership and operational responsibility of its Russian business unit to Skodnya Grand LLC and to grant post completion of the transaction, a 5 year renewable license agreement for its Russian brands to Tea Trade LLC. TGB will continue to retain ownership of its brands in Russia. The new owner will continue to manufacture and sell TGB’s existing brands and products, for which TGB will receive royalties.                               
TGB has also disposed its stake in its Chinese Joint Venture, Zhejiang Tata Tea Extraction Company Limited.

The quarter saw continued focus on brand campaigns and strengthening our key brands.

Ajoy Misra, Managing Director and CEO of Tata Global Beverages, said, “The Company recorded significant profit growth last quarter driven mainly by improved operating performance. Our joint ventures in India- Nourish Co and Tata Starbucks have also performed very well.  We will continue to pursue aggressive growth through base business rejuvenation, innovation and category expansion. Health and wellness continues to be a key focus area for Tata Global Beverages and our recent innovations are built around this trend. We are also premiumizing our brands by creating enhanced beverage experiences for consumers through vitamin enhanced teas, indulgent and specially curated tea blends, flavored waters and coffees catering to varied consumer needs.”