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It had reported a profit of Rs 97 crore for the same quarter last financial year. During the quarter, TGBL’s net sales rose to Rs 2,004 crore, up 6.4 per cent from Rs 1,884 crore in the year-ago period, TGBL said in a BSE filing.
Chief Financial Officer L Krishna Kumar said: “We are increasing our strength in the Middle East, so we are investing in the advertisement and expansion of business, which would be paid off in the subsequent quarter.”
The spending also impacted its profit and revenues sequentially. “The fact is that we have lot of lumping of advertising expenditure in the same quarter and investments behind new initiatives behind water and new business is the reason why profit quarter-on-quarter is low,” he added. During the quarter, TGBL’s expense of advertisement and sales were up 14 per cent to Rs 326 crore as against Rs 285 crore of the same quarter of 2014-15.
Overall expenses stood at Rs 1,876 crore, up 7.5 per cent as against Rs 1,744 crore in the year-ago period. TGBL’s revenue from tea in the quarter increased by 5.08 per cent to Rs 1,524.87 crore while revenue from coffee went up by 9.57 per cent to Rs 468.76 crore.
The company's revenue from other segments rose by 11.29 per cent to Rs 35.36 crore.
Apart from India, TGBL has also performed well in the international markets during the quarter. “Other markets like Canada, Middle East and Russia performed well. Continued focus on the green and specialty tea category across geographies enabled share gains in key markets,” TGBL said in a statement. During the quarter, in Poland, Vitax brand launched five new flavours based on exotic fruits.
TGBL, which is currently operating 76 stores of coffee chain Starbucks, would continue to expand it.
"We are doing very well in terms of profitability and growth. It has now 76 stores and we would continue to add stores every quarter," Kumar said.
Shares of the company today settled at Rs 143.80 apiece on BSE, up 1.20 per cent from previous close.
