Mumbai: Parag Milk Foods Ltd (PMFL), a leading manufacturer and marketer of dairy-based branded products in India announced its unaudited financial result for the quarter and half year ended 31 December 2023.

Key Highlights Consolidated Q3 FY24:

•    Revenue stood at Rs  8,008.4 million; a growth of 8.8  per cent YoY
•    Gross profit stood at Rs 2,107.5 million; with a Gross profit margin of 26.3  per cent
•    EBITDA stood at Rs 686.5 million; with an EBITDA margin of 8.6 per cent
•    Profit After Tax stood at Rs 341.6 million; a growth of 268.8 per cent YoY.

Key Highlights – Consolidated 9MFY24

•    Revenue stood at Rs  23,485.9 million; a growth of 12.3 per cent YoY
•    Gross profit stood at 5,545.4 million; with a Gross profit margin of 23.6  per cent
•    EBITDA stood at Rs 1782.1million; with an EBITDA margin of 7.6 per cent
•    Profit After Tax stood at Rs 807.7 million; a growth of 161.4 per cent YoY.

For Q3FY24, the consolidated revenue from operations grew by 8.8 per cent on a yoy basis, at INR 8008.4 million. The growth came on the back of healthy growth in the ghee and protein category. The softness in the milk prices coupled with the improving product mix resulted in a sharp expansion in the gross profit margin for the company.  The gross profit margin expanded by 520 bps on a yoy basis from 21.1 per cent in Q3FY23 to 26.5 per cent in Q3FY24. The EBITDA grew by 80.5 per cent yoy; with an EBITDA margin of 8.6 per cent for Q3FY24 as against 5.2 per cent in Q3FY23.

For 9MFY24, the consolidated revenue from operations grew by 12.3 per cent on a yoy basis at INR 23,485.9 million. The gross profit margin expanded by 450 basis points yoy at 23.6 per cent in 9MFY24 as against 19.1 per cent in 9MFY23.  Driven by operational excellence, the EBITDA grew by 52.2 per cent yoy, with an EBITDA margin of 7.6 per cent for 9MFY24 as against an EBITDA margin of 5.6 per cent in 9MFY23.

PMFL is consistently investing towards enhancing its brand strength by employing an innovative blend of marketing activities.  The company has undertaken a series of efforts towards expanding the overall distribution reach, wherein it aims to triple its reach to more than 15 lac retail outlets.

Commenting on the results Mr. Devendra Shah, Chairman said, “It gives me immense pleasure to state that our consolidated revenues for the quarter has grown by 8.8 per cent yoy; whilst our margins and profitability have witnessed strong improvement. The Gross and EBITDA margins have expanded by 520 basis points and 340 basis points to reach 26.3 per cent and 8.6 per cent respectively.

Over the last two quarters, the milk procurement prices have been benign and we expect it to remain stable ahead. Improving consumer sentiments coupled with our continuous focus on the value-added products and the health and nutrition segment is expected to drive healthy performance in future.

We are in the midst of a transformation journey aimed at driving efficiency across the value chain. With an ensuing expansion and acceleration of the distribution footprint, we are confident to show robust growth in our revenues and profitability”

Key developments in Q3FY24

Brand building initiatives- The company has strengthened its brand equity reach by adopting unique content-led impact marketing and branding campaigns. Continuing the momentum on the marketing innovation; the company continued its effective collaboration with Kaun Banega Crorepati (KBC) for the second time. The association has enabled the company to increase its consumer connection and strengthen brand equity.

Procurement:  For the quarter, the average milk procurement stood at 17 lac litres per day; aided by a stable global market coupled with a good flush season; the milk prices have stabilized. For the quarter the average milk price stood at Rs 32.2 per litre.

Distribution reach: The overall business growth was largely broad-based with all channels posting good growth. In line with the targeted initiative of expanding the retail reach and presence; PMFL continues to invest in the sales and distribution (S&D) infrastructure

9MFY24 business performance

Core categories:  The core categories of Ghee and Cheese have seen continuous traction throughout the period and have posted a growth of 11.1 per cent  Y-o-Y.

New age business- Brand Avvatar: The Direct to Consumer (D2C) brand Avvatar continued its momentum and recorded robust 62.0 per cent growth YoY, led by 45 per cent volume growth YoY. The overall protein portfolio has continued to record market share gains.  

Premium Dairy Business- Pride of Cows (PoC):  In line with the company’s premiumization agenda- the brand Pride of Cows continues to witness healthy traction. The brand is expanding its product portfolio as well as distribution footprint.   During the quarter, the brand was extended into the Vadodara market, which makes it a seven-city brand. Pride of Cows is posting profitable and Sustainable growth.