Adani Wilmar Q1 results: Records Net Loss of Rs 79 Crore, Revenue Drops 12% YoY

Adani Group-backed FMCG firm, Adani Wilmar posted a net loss of Rs 78.92 crore in the quarter ending June 30, 2023 (Q1FY24) period, compared to a profit of Rs 193.59 crore in the same quarter a year ago. Meanwhile, the company's top-line (revenue from operations) dipped by 12.2% to Rs 12,928.08 crore in Q1FY24, as against Rs 14,724.09 crore in Q1FY23, owing to a steep decline in edible oil prices.

In the March 2023 quarter, Adani Wilmar posted a PAT and revenue of Rs 93.61 crore and Rs 13,872.64 crore respectively.

Adani Wilmar's stock ended in red following the earnings. On BSE, Adani Wimar's stock price ended at Rs 400.40 apiece, down by 3.10%.

Angshu Mallick, MD & CEO, Adani Wilmar said, "Our margins during the quarter got impacted by high-cost inventory in a falling edible oil price environment and dis-aligned hedges compared to spot prices of the physical commodity."

In the quarter, the company's food segment recorded strong revenue growth of 28% YoY to Rs 1,100 crore. This would also be the eighth consecutive quarter where growth is over 20% in the segment.

Meanwhile, Adani Wilmar highlighted that since Q1 of the last fiscal year, the price of edible oils has been declining. This trend continued
during Q1'24 with the price of edible oils experiencing a further decline, in the range of 5% to 20% (Q1'24 vs. Q4'23), before recovering as the quarter came to a close.

It added, "This reduction has been attributed to a combination of factors, including the decline in consumer demand in developed economies, easing of supply at the Black Sea region and robust production of oilseeds globally."

However, Adani Wilmar also said that the company delivered another strong quarter with 25% YoY volume growth, capturing the robust consumer demand. The sale of branded products in both edible oils and foods has been much stronger compared to the overall sales of respective segments. While the volume growth was strong at 25% YoY, the sales value declined by 12% on a YoY basis, which is reflective of the steep decline in edible oil prices.

Going ahead, Mallick said, "We have regained the momentum in our edible oil business with the decline in the edible oil prices. The soft prices of edible oil are expected to augur well for the industry. The company is gaining good share from regional brands in the under-indexed customer segments with marketing and sales focus on specific geographies and oil categories. To capture the opportunity in the value-added blended oils, Company is investing in this segment, under Xpert brand."