Hindustan Coca-Cola Beverages Reports 73% Profit Decline
Hindustan Coca-Cola Beverages Ltd (HCCBL) has reported a significant decline in its financial performance. Net profit fell by 73% to ₹756.64 crore from ₹2,808.31 crore in the previous year. Revenue from operations decreased by 9% to ₹12,751.29 crore. The decline is attributed to a higher base effect from the previous year's divestment gains, a reduction in exceptional items from ₹2,526.70 crore to ₹119.90 crore, and lower tax expenses. Coca-Cola recently sold a 40% stake in HCCBL to Jubilant Bhartia Group as part of its refranchising strategy.
*this image is generated using AI for illustrative purposes only.
Hindustan Coca-Cola Beverages Ltd (HCCBL), a key player in India's beverage industry, has reported a significant decline in its financial performance. The company's latest financial results reveal a sharp drop in profitability and a notable decrease in revenue.
Financial Performance Overview
| Metric | Current Year | Previous Year | Change |
|---|---|---|---|
| Net Profit | ₹756.64 crore | ₹2,808.31 crore | -73% |
| Revenue from Operations | ₹12,751.29 crore | ₹14,021.55 crore | -9% |
| Total Tax Expenses | ₹247.98 crore | ₹886.36 crore | -72% |
| Exceptional Items | ₹119.90 crore | ₹2,526.70 crore | -95% |
The company's net profit saw a substantial 73% decline, falling to ₹756.64 crore from ₹2,808.31 crore in the previous year. Revenue from operations also experienced a 9% decrease, dropping to ₹12,751.29 crore from ₹14,021.55 crore.
Factors Influencing the Results
The sharp decline in profit can be attributed to several factors:
Higher Base Effect: The company had a higher base in the previous year due to gains from divesting bottling operations in Rajasthan, Bihar, North-East, and parts of West Bengal.
Exceptional Items: There was a significant reduction in exceptional items, which stood at ₹119.90 crore compared to ₹2,526.70 crore in the previous year.
Reduced Tax Expenses: Total tax expenses decreased by 72% to ₹247.98 crore, which partially offset the impact of the revenue decline.
Strategic Moves
In a significant development, Coca-Cola sold a 40% stake in HCCBL to Jubilant Bhartia Group in July. This move is part of Coca-Cola's broader strategy in the Indian market.
CEO James Quincey commented on these strategic moves, stating that they will unlock growth opportunities in India and Africa. This is part of completing the refranchising strategy that began in 2015.
Company Profile
HCCBL maintains a diverse product portfolio, manufacturing 37 products across eight categories. These include popular brands such as Coca-Cola, Thums Up, Sprite, and other beverages.
The company's performance this fiscal year reflects the challenges and changes in the beverage industry, as well as the impact of strategic corporate actions. As HCCBL navigates these changes, the market will be watching closely to see how these moves shape its future growth and profitability.
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