Jewellery sales in Q1 slumped 10.9 percent to Rs 2072.03 crore from Rs 2325.27 crore year-on-year.
Titan Company has once again disappointed street with dismal April-June quarter due to weak consumer sentiment and absence of Golden Harvest scheme. The company's Q1 net profit fell 14.8 percent to Rs 151.06 crore from Rs 177 crore in corresponding quarter last fiscal. Sales, during the quarter, declined 6.3 percent to Rs 2708.6 crore from Rs 2891.6 crore in year-ago period.
According to a CNBC-TV18 poll, the company's Q1 net profit was expected to rise 13 percent at Rs 201 crore while revenues was seen marginally up 1.1 percent at Rs 2924 crore.
Jewellery sales in Q1 slumped 10.9 percent to Rs 2072.03 crore from Rs 2325.27 crore year-on-year. During the quarter, EBITDA was at Rs 223 crore against Rs 274 crore while EBITDA margin was at 8.2 percent (Y-o-Y).
The company says that its jewellery business continues to face regulatory pressures that have an adverse impact on sales. Absence of original Golden Harvest Scheme (which used to contribute 30 percent to jewellery revenues) hurted business.
Bhaskar Bhat, MD says, "The first quarter has been extremely challenging one. Retail sales for both our core businesses watches and jewellery have been below expectations due to reduced walk-ins. May and June, in particular were poor months. Rural demand was effected due to lower realisations and monsoon conditions. With good monsoon in sight and festive season ahead, we look forward to better year ahead."
Meanwhile, its other business including watches and eyewear saw some growth. Revenue in watch business fetched Rs 484.54 crore in Q1, up 9 percent from Rs 444.19 crore (Y-o-Y). Eyewear business grew 19.7 percent to Rs 106.77 crore from Rs 89.21 crore (Y-o-Y). Other business (including precision engineering) was up 36.3 percent to Rs 46.85 crore.
"The company has put togather plans to stimulate demand for all its product categories through innovative advertising campaign and new products launches in the coming quarters," it says in a press statement.
Total expenses was down 5 percent at Rs 2509 crore, while advertising spends went higher by 30 percent at Rs 129 crore. Raw material costs saw declined 24.5 percent at Rs 1366 core along with significant decline in gold prices.
The company has added 22 stores making it a total of 1223 store in its retail chain.
At 14:54 hrs Titan Company was quoting at Rs 323.00, down Rs 16.65, or 4.90 percent on the BSE.