INDIA: Arvind posts 48% jump in FY net profit
- Full-year net profit increased 48%
- Revenue rose 21%
- Fourth-quarter revenue increased 6%
Indian textile and apparel business Arvind Ltd recorded a 48% jump in full-year net profit, driven by strong growth in its brands and retail business combined with higher prices at its factories due to higher cotton prices.
The company said profit after tax reached reached INR2.45bn (US$45.9m) over the year ended 31 March 2012. Revenue increased 21% over the year to INR49.25bn, and EBITDA rose 14% to INR6.02bn
Revenues were driven by a 44% growth in the brands and retail business and significant increases in prices of fabrics caused by high cotton costs. The firm's cotton business grew 15% over the year. Within textiles, denim grew 18% and wovens were up 11%. However EBITDA margin fell to 12.2% from 13% as the company absorbed higher inventory costs in its brands and retail business.
For the fourth quarter, revenue increased 6% to INR12.78bn.
"The financial year 2011-12 was extremely challenging year for Arvind," said director and CFO Jayesh Shah. "The year was characterised by global slowdown, weak retail demand at home, high volatility in cotton prices and foreign exchange and higher interest cost.
"It is satisfying to note that in the backdrop of such a challenging environment, our company has closed the financial year 2011-12 with 48% growth in net profit."
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