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Bata India’s Q4 results show focus on retail optimization & expansion

By Retail4Growth Bureau | May 26, 2022

The footwear major has announced that the continued focus on key thrust areas of franchise & MBO expansion, consumer relevant communication, portfolio casualisation, digital footprint expansion and expansion in Tier 3-5 towns have resulted in increase in footfalls across retail outlets, with the revenue for the quarter staying in line with pre-pandemic levels for a second consecutive quarter.

Footwear major Bata India Limited has announced its financial results for the quarter ended 31st March 2022, which shows that the continued focus on key thrust areas of franchise & MBO expansion, consumer relevant communication, portfolio casualisation and digital footprint expansion have resulted in increase in footfalls across retail outlets, along with significant growth driven via e-commerce platforms and expansion in Tier 3-5 towns. This resulted in revenue for the quarter staying in line with pre-pandemic levels for a second consecutive quarter. This was despite Omicron related disruptions in initial part of the quarter, which was offset in the latter part of the quarter where the company says it saw significant rebound on growths.

The company has announced that despite Omicron disruptions, revenue from operations for the quarter stood at Rs. 6652 million and profit before tax was Rs. 844 million as against the profit before tax of Rs. 403 million in the quarter ended March 31, 2021, backed by improved consumer sentiments in latter part of the quarter, and showcasing strong & sustainable recovery. For the year FY 2021-22, the company recorded revenue of Rs. 23,877 million and profit before tax of Rs. 1368 million against a revenue in FY 2020-21 of Rs 17073 million  and a loss before tax of Rs. 1177 million

Continuous focus on optimizing costs across value chain

The company continued to optimize its retail network and look for cost-savings across rentals & operations, manufacturing, and drive efficiencies in its value chain. All the cost-focused initiatives, which have been put in place across multiple work streams continue to gain momentum and are showing impact quarter on quarter, the company informed .

Ashwani Windlass, Chairman commented,  “Bata India has had a robust performance and is on a sound trajectory ahead. Given its focus on newer collection, expansion through all channels and omni channel in particular, Bata India is well poised for the future. Its new business model and focus is reflected in the quick retrieval of business to pre pandemic levels and further growth. Our free cash from operations and operating leverage remains at a significant level, which affords us the financial flexibility to grow our business organically and/or inorganically as appropriate.”

Gunjan Shah, MD and CEO - Bata India Limited, stated, “In the last two quarters, we witnessed significant recovery in demand in the backdrop of improvement in consumer sentiments and deeper understanding of the pandemic, availability of vaccines and faster easing of restrictions. We kept expanding our reach through new franchise stores & multi-brand outlets. We opened 22 new Franchise stores taking the total number 300+, expanded availability via distribution channel that continued to scale up to 1000+ towns. We have enhanced our portfolio in casual & fashion footwear section across categories. Sneakers led the growth recovery in the quarter while formal & fashion also recovered significantly. We continued upshift in marketing investments with campaigns like Unlimited Sneaker, Neo casuals for Neo Leaders and It’s Got to be Bata, 24x7 Casual Collection which strengthened our consumer connect for our brand.”

“Simultaneously, we continued our strong focus on cost-savings measures across our network, controlling discretionary spends, enhancing productivity and premiumisation in the face of volatile inflation. These measures have laid the foundation that will help us capture the emerging consumer demand efficiently. With scaling of above expansion/efficiency levers & rebound in consumer sentiments, we expect the momentum to continue towards pre-pandemic growth rate in the current quarter also as seen in quarter till date at 11% ahead of pre-covid levels, gross margins sustaining at 58% levels. Innovation via agile product creation, scaling up digital channels, expansion in Tier 3-5 towns, and productivity enhancement will continue to be a priority along with investments in our brands & stores,” he added.

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