Tata Global Beverages : Year end Results for FY 2014-15

Consolidated Results

Income from Operations for the year at Rs 7993 crs, up by 3%
Profit from operations for the year at Rs 642 crs, up by 3%

Tata Global Beverages Ltd. today announced its results for the year ended FY 2014-15. The Company reported a steady growth in revenue and operating profits as compared to the prior year.

For the financial year, Income from operations at Rs 7993 crores increased by 3%. At constant exchange rate the increase is higher at 5%. Profit from operations at Rs 642 crores is 3% higher than the previous year. The increase in profits reflects strong performance in branded business partially offset by lower profits in the non-branded business. Operating profits were higher than the previous year despite increasing investment in new ventures and product initiatives. Post the adverse impact of exceptional items, the Group Consolidated Net Profit is Rs 248 crores.

During the quarter, the Holding Company recognized a non-cash impairment loss under exceptional items relating to its businesses in China and Eastern Europe. The impairment relating to the China business is on account of delays in start up and stabilization of technology for an enhanced product range. In the case of Eastern Europe, the goodwill impairment mainly relates to Russia and to a lesser extent to Eastern European branded business. In Russia, the impairment is arising due to adverse macroeconomic environment with resultant adverse impact on interest and discounting rates used for impairment assessment.

The year saw a strong focus on the green & specialty tea category, innovative product launches and strong marketing campaigns.

The tea business in India achieved record sales of 100 million kgs, its highest ever sale in a year. The brand continues to be a market leader in India. During the year, the company strengthened focus on the green tea category across markets. In India, Tata Tea Acti green was launched aimed at popularising green tea and making it accessible to a wide range of consumers with convenient price points and milder blends, in exciting Indian flavours. In the UK, Tetley launched a range of 'super green teas' that are the first functional green teas in the UK with proven health benefits. The teas have added vitamins and premium natural flavours. In Canada, Tetley launched a premium line of specialty teas called the Tetley Signature Collection to reinforce Tetley's leadership position in Specialty teas in Canada. In Poland, the Vitax brand launched Herbal Inspirations - a unique fusion of well-known herbal tastes with a hint of sweetness: Mint & Honey, Chamomile & Caramel and Lemon Balm & Vanilla.
Tetley in the UK ran an impactful communication campaign showcasing its 175 year heritage of tea blending expertise, reinforcing its credentials in delivering quality products. Tata Global Beverages entered the premium black tea segment in Australia with the launch of Tetley Tea Master's Selection, a range of single origin teas.

In the coffee segment, the acquisition of the MAP brand gave TGB entry into the coffee segment in Australia in roast & ground coffee as well as the fast growing single serve segment. Eight O Clock Coffee continues to strengthen its presence in the growing single serve segment in the US. During the year, the brand launched an impactful promotion campaign together with Warner Bros. centered around the 20th anniversary of the Emmy award winning TV series 'Friends.' The campaign met with enthusiastic response from coffee lovers. Tata Starbucks has expanded steadily and now has over 70 stores across India, covering seven cities- Mumbai, Delhi, Gurgaon, Pune, Bengaluru, Hyderabad and Chennai .

In the water segment, Tata Gluco Plus underwent a brand refresh including a packaging change and a catchy TVC highlighting its glucose energy benefit. Himalayan natural mineral water launched its sparkling variant-a natural, mineral enriched water with added mild carbonation. A new ad campaign was launched for the brand last quarter telling the story of its unique source and how the brand can play a role in our busy urban lives by helping us to 'Live Natural.'

Mr. Ajoy Misra, Managing Director and CEO of Tata Global Beverages, said - " We've posted steady growth in operating profits despite a very challenging market environment in some parts of the world. We are meeting these challenges through process improvements and a continued focus on brand building and innovation. We see green & specialty tea and newer categories like pods and functional water as drivers for growth. We will continue to invest behind them while also strengthening our core tea markets and sustaining growth in our JVs and strategic alliances."