Marico (MARICO) Q4 11/12 earnings summary

Executive summary

• FY12 revenue from operations rose 28% to ₹4,008 crore on 17% volume growth; reported PAT increased 11% to ₹317 crore. Five-year revenue and PAT CAGRs were 21% and 23%.

• Growth priorities centered on expanding consumer reach, volume growth, brand investment, rural distribution and operational efficiency despite inflation and currency pressure.

Financial highlights

• Net sales/income from operations was ₹4,008.3 crore vs ₹3,135.0 crore; total income was ₹4,040.9 crore vs ₹3,156.2 crore.

• Reported PAT was ₹317.1 crore vs ₹286.4 crore, up 11%; adjusted for exceptional and non-comparable items, PAT was ₹326 crore vs ₹262 crore, up 25%.

• PBT was ₹400.3 crore vs ₹376.4 crore; profit before exceptional items was ₹402.1 crore vs ₹327.5 crore. FY12 exceptional items were a ₹1.75 crore expense.

• Operating cash flow increased to ₹407 crore from ₹244 crore; cash flow from investing was an outflow of ₹331 crore and financing an outflow of ₹119 crore.

Outlook and guidance

• Prioritize long-term consumer franchise growth over margins; immediate outlook remains uncertain amid inflation, slower GDP estimates and weak currencies in some international markets.

• Medium-term annual volume growth targets: coconut oils 6–8%; value-added hair oils 15–17% over 2–3 years; Saffola premium refined oils ~15%.

• Target ~25% of Saffola revenue from healthy foods within 3 years; integrate the Paras portfolio, expected to outgrow the existing portfolio.

• IBG expected to grow at healthy double-digit rates; Kaya to focus on existing-clinic revenue, product sales and a smaller clinic prototype with lower rent and capital needs.