Dodla Dairy (DODLA) Q4 20/21 earnings summary

Executive summary

• FY21 consolidated revenue from operations fell 9.13% YoY to ₹19,440.06m, while PAT rose 152.6% to ₹1,259.70m, supported by lower milk procurement costs and cost controls.

• Pandemic-related weakness in institutional and out-of-home demand constrained sales; margins improved, with consolidated EBITDA margin at 12.5% versus 6.6% in FY20.

• Direct farmer procurement reached 93% of milk procurement; average DDCC collection rose to 9.52 LPD from 9.21 LPD, with 6,771 DDCCs at year-end.

Financial highlights

• Consolidated total income was ₹19,503.74m versus ₹21,456.49m; EBITDA was ₹2,424.67m versus ₹1,409.26m.

• Consolidated PBT increased to ₹1,862.16m from ₹818.71m; PAT attributable to shareholders rose to ₹1,259.70m from ₹498.71m.

• Standalone revenue from operations declined 7.58% YoY to ₹18,369.04m; standalone PAT increased to ₹1,083.94m from ₹284.71m.

• Consolidated operating cash flow was ₹2,450.62m versus ₹1,655.81m; cash and cash equivalents ended FY21 at ₹1,241.44m versus ₹686.73m.

Outlook and guidance

• FY22 revenue was expected to rebound as lockdowns eased and economic activity resumed; recently added capacity was expected to support growth, with operating margins expected to remain strong.

• Strategy centers on increasing value-added products (VAPs), expanding product reach and strategic geographies, and pursuing viable organic and inorganic growth opportunities.

• Direct procurement target is 100%; management cited potential benefits including lower procurement costs, improved milk quality, stronger farmer relationships and lower working capital.