May 11, 2018
Tata Global Beverages announces results for the quarter and year ended March 2018
- Profit before tax and exceptional items for the year at Rs774 crore, up by 18 percent
- Group consolidated net profit for the year at Rs557 crore, up by 22 percent
Tata Global Beverages today announced its results for the quarter and year ended March 2018. For the year, after excluding the impact of sale and restructuring of the group’s businesses, revenue from operations has increased by 2 percent in constant currency on a comparable basis. Profit before exceptional items at Rs774 crore is higher by 18 percent as compared to previous year due to improved operating performance, restructuring, good cost management and lower finance costs. Group consolidated net profit for the year at Rs557 crore is higher by 22 percent as compared to the previous year.
Whist operating performance from the branded segment was 18 percent higher, profits from the nonbranded segment were lower due to adverse impact of abnormal and extreme weather conditions resulting in substantially lower coffee crop harvested. This was further accentuated by lower commodity prices.
For the quarter, after excluding the impact of sale and restructuring of the group’s businesses, revenue from operations increased by 4 percent in constant currency on a comparable basis. The group net profit for the quarter grew by 40 percent as compared to the corresponding quarter of the previous year due to lower level of exceptional expenditure.
The year saw strong focus on strengthening our core brands, streamlining the business and category expansion.
In India, the Tata Tea Jaago Re campaign on instilling positive change in the areas of women’s safety and lack of sports culture in the country, received an excellent response, receiving nearly 1.8 million online petitions which were then presented to the Union Minister of Human Resource Development, Government of India. A new campaign was launched for Tetley Green tea with brand ambassador Deepika Padukone bringing alive the positioning of Tetley Green Tea as a beverage which cleanses you from within leaving you feeling refreshed and active. The Kanan Devan brand launched the third edition of its Photography Escapade campaign which was India’s largest photography reality show.
The Tetley brand commemorated its 180th year milestone with various brand activations underscoring its heritage and quality credentials.
Tata Starbucks, the joint venture between Tata Global Beverages and Starbucks Coffee Company, launched its 100th store in India last year and also entered the city of Kolkata. Starbucks stores are now present in seven cities across India. Eight O’ Clock coffee in the USA added three new variants to its Infusions line providing more reasons for consumers to enjoy coffee throughout the day. Tata Coffee Grand, our entry into the branded instant coffee market in India, launched a filter coffee variant in the southern markets which was very well received.
Tata Cha was launched as a pilot to evaluate the out of home beverage space. The company plans to test launch a total of four pilot stores to evaluate the consumer proposition and business model. In the RTD segment, we are piloting a new launch in the Delhi NCR region called Tata Tea Fruski, a green tea based refreshing drink and in Australia, Good Earth Kombucha, a fermented RTD tea drink was launched in four variants. Tetley in UK broadened its presence in the area of functional drinks with the launch of Tetley Super Squash - a first of its kind product based on a blend of real fruit juices enhanced by added vitamins carrying EFSA approved health benefits.
In the water segment, Tata Global Beverages’ premium offering- Himalayan natural mineral water is entering the USA in a phased manner, through an agreement signed by its subsidiary with Talking Rain Beverage Company®. In India, the brand launched its flavoured water variant, Orchard Pure. Tata Gluco Plus launched two new flavours and continues to show good growth.
Ajoy Misra, managing director and CEO, Tata Global Beverages, said, “Over the last year, we’ve focused on streamlining the organisation for better agility and business performance. Tata Global Beverages remains focused on base business rejuvenation through brand building, category expansion and enhancing distribution reach. We continue to explore new opportunities through our pilot projects such as Tata Cha, products in the RTD segment and entering new categories like Tetley Squash. We are also increasingly focusing on the digital space and leveraging the possibilities this offers, both in terms of consumer connect campaigns as well as e-retail. Our joint ventures have clocked good growth and have performed well during the year.”