InvestorQ : Why did Emami report such a sharp fall in net profits for the Mar-20 quarter?
sarah Leo made post

Why did Emami report such a sharp fall in net profits for the Mar-20 quarter?

Answer
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vidhya Laxmi answered.
4 months ago


Emami reported 58% fall in net profits at Rs.23 crore for the Mar-20 quarter essentially due to the sustained impact of the lockdown. Total Revenues of Emami from operations also fell by 16.8% at Rs.532.68 for the Mar-20 quarter. One of the major reasons for this tepid performance by Emami was the weak rural demand and lockdown related liquidity worries.

It may be recollected that operations had come to a complete standstill during the last week of March due to nationwide lockdown. This had largely impacted the pre-season sale of the summer portfolio which largely impacted their numbers. EBITDA for the quarter fell 37% at Rs.98.53 crore while the operating margins 578 basis points lower at 18.49%.

For the fiscal year 2019-20, Emami reported net profits flat at Rs.302.91 crore while the top line revenues were 1.5% lower at Rs.2655 crore. Like most FMCG companies, Emami also saw a weakening of the top line in the March quarter due to the lockdown effect and the lag is likely to be felt in the first two quarters of the current fiscal also.