Modern Dairies Reports 17% Revenue Decline in Q1, Profit Drops 57%
Modern Dairies Limited experienced a challenging first quarter with revenue from operations decreasing by 17.08% to ₹783.03 crores and profit after tax dropping by 57.22% to ₹16.51 crores compared to the same period last year. Total income declined to ₹784.39 crores from ₹945.90 crores. The company managed to reduce its cost of materials consumed by 22.66% to ₹605.72 crores. Modern Dairies also disclosed an ongoing legal issue regarding a Milk Cess liability of ₹544.31 crores to the Haryana government, currently pending before the Supreme Court.
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Modern Dairies Limited , a leading manufacturer of milk and milk products, has reported its financial results for the first quarter. The company faced challenges during the quarter, with both revenue and profit showing significant declines compared to the same period last year.
Financial Highlights
- Revenue from operations decreased by 17.08% to ₹783.03 crores, down from ₹944.34 crores in the same quarter of the previous year.
- Total income declined to ₹784.39 crores from ₹945.90 crores year-over-year.
- Profit after tax dropped by 57.22% to ₹16.51 crores, compared to ₹38.59 crores in the previous year's quarter.
- Cost of materials consumed decreased to ₹605.72 crores from ₹783.21 crores.
Quarterly Performance Analysis
Despite the overall decline in revenue and profit, Modern Dairies managed to maintain profitability in a challenging environment. The company's cost-cutting measures are evident in the reduced cost of materials consumed, which decreased by approximately 22.66% compared to the same quarter last year.
The following table summarizes the key financial metrics:
| Particulars (in ₹ crores) | Q1 | Q1 (Previous Year) | YoY Change |
|---|---|---|---|
| Revenue from Operations | 783.03 | 944.34 | -17.08% |
| Total Income | 784.39 | 945.90 | -17.08% |
| Cost of Materials Consumed | 605.72 | 783.21 | -22.66% |
| Profit After Tax | 16.51 | 38.59 | -57.22% |
Operational Overview
Modern Dairies Limited continues to focus on its core business of manufacturing milk and milk products. The company's financial results reflect the challenges faced in the dairy industry, including potential fluctuations in raw material costs and market demand.
Ongoing Legal Matter
The company disclosed an ongoing legal issue regarding Milk Cess liability to the Haryana government. As of December 31, 2023, Modern Dairies had received a demand notice for ₹544.31 crores for Milk Cess along with compounded interest. The matter is currently pending before the Supreme Court, with an interim stay granted in 2012.
As a precautionary measure, the company has made provisions for Milk Cess in its accounts. For the current quarter, an additional provision of ₹11.81 lakhs was made, bringing the total provision to ₹21.42 crores. Modern Dairies has already deposited ₹9.91 crores as per the orders of the Supreme Court and the Punjab & Haryana High Court.
Conclusion
Modern Dairies Limited's quarterly results reflect the ongoing challenges in the dairy sector. While the company has experienced a notable decline in both revenue and profit, its ability to reduce costs and maintain profitability indicates resilience in a difficult market environment. Investors and stakeholders will likely be watching closely to see how the company navigates these challenges in the coming quarters and addresses the ongoing legal matter regarding Milk Cess liability.
Historical Stock Returns for Modern Dairies
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -0.50% | -2.98% | -2.90% | -14.41% | -18.52% | +1,432.90% |
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