Tata Coffee posts Q1FY24 profit at Rs 47.48 crore, total income up 6% on good biz in India and Vietnam

Tata Coffee posts Q1FY24 profit at Rs 47.48 crore, total income up 6% on good biz in India and Vietnam

Tata Coffee, a subsidiary of Tata Consumer Products and a part of the Tata Group, has announced its fiscal first-quarter results, showing a profit of Rs 47.48 crore. This represents a growth of 5.5% compared to the profit of Rs 45.01 crore in the same quarter of the previous year. The company attributed the subdued performance of Eight O’clock Coffee (EOC) as a factor impacting the profit.

Tata Coffee reported revenue from operations of Rs 700.65 crore, marking a 5.8% increase from Rs 662.23 crore in the first quarter of FY23. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at Rs 117.3 crore, reflecting a 0.6% growth compared to the previous year.

While the overall performance of Tata Coffee showed growth in revenue and profit, the subdued performance of Eight O’clock Coffee impacted the profitability of the company. Despite this, Tata Coffee remains focused on its business operations and aims to address the challenges faced by Eight O’clock Coffee to improve its performance in the future.

As a part of the Tata Group, Tata Coffee strives for growth and profitability in the competitive coffee industry. The company is committed to leveraging its expertise and resources to deliver quality products and expand its market presence. With a strong foundation and the support of the Tata Group, Tata Coffee is well-positioned to navigate market dynamics and drive sustained growth in the future.

During the first quarter, Tata Coffee reported a total income of Rs 707.93 crore, while the total expenses amounted to Rs 626.02 crore. This resulted in a consolidated total income increase of 6%. The growth was primarily driven by higher realizations in the plantation coffee and instant coffee businesses in both India and Vietnam.

Tata Coffee highlighted the strong sales performance of its Vietnam operations, which contributed to improved profitability. The company experienced higher sales of premium products and has a robust and healthy order pipeline in Vietnam. This positive performance reflects the successful execution of Tata Coffee’s business strategy in the region.

The company’s focus on delivering quality products, along with its strong sales and order pipeline, has contributed to its growth in both India and Vietnam. Tata Coffee remains committed to enhancing its operations and capitalizing on market opportunities to drive sustainable profitability and expand its market presence in the coffee industry. On a standalone basis, Tata Coffee reported a total income of Rs 262 crore for the quarter, representing a 7% increase compared to last year. The growth in real income can be attributed to increased revenues from coffee plantation activities.

Tata Coffee highlighted that its tea plantation operations improved compared to the previous year’s corresponding quarter. This improvement was driven by higher crop yield and better realizations. Additionally, the company noted that the green coffee turnover and profitability improved over the previous year. This was mainly due to improved prices and a favorable product mix.

The positive performance in coffee plantation and tea plantation operations demonstrates Tata Coffee’s focus on optimizing productivity and capturing favorable market conditions. The company’s efforts to enhance its product mix and achieve better price realizations have contributed to its financial growth during the quarter.

Tata Coffee remains committed to leveraging its coffee and tea business expertise to drive sustainable growth and deliver value to its stakeholders.According to Chacko P Thomas, the Managing Director of Tata Coffee Limited, the company’s standalone performance has been strong, even in the face of inflationary and recessionary trends observed in the markets. He noted that the Coffee Plantation segment performed well, benefiting from improved realizations. However, he mentioned that the monsoon during the quarter was deficient in the company’s Coffee plantations.

Regarding the tea plantations, Thomas stated that their performance was robust in the quarter. This was driven by higher crop production and a lower cost of production. He further highlighted the strength of Tata Coffee’s operations in Vietnam, mentioning a healthy order pipeline and operations running at maximum capacity.

Thomas’s comments reflect the positive outlook and resilience of Tata Coffee in navigating market challenges and optimizing its operations. The company’s focus on improving productivity, cost management, and leveraging its diverse portfolio has contributed to its strong performance across its coffee and tea businesses. Tata Coffee, a subsidiary of Tata Consumer Products, is a leading producer of shade-grown Arabica and Robusta Coffee in India. The company operates 19 estates located in South India, where it cultivates and harvests high-quality coffee beans. Annually, Tata Coffee produces between 8,000 to 10,000 metric tons of coffee, emphasizing sustainable and environmentally friendly practices in its operations.

Apart from serving the domestic market, Tata Coffee exports green coffee to various countries across the globe. Its exports reach destinations in Europe, Asia, the Middle East, and North America, catering to the growing global demand for premium Indian coffee. The company’s commitment to quality and consistency has earned it a reputation as a reliable supplier in the international coffee market.

In addition to coffee production, Tata Coffee is also the largest corporate producer of pepper in India. This diversification allows the company to leverage synergies between the coffee and pepper industries, optimizing resources and enhancing its agricultural footprint.

Tata Coffee’s manufacturing capabilities extend to the production of instant coffee. With two state-of-the-art facilities located in India, the company has a combined installed capacity of 8,400 metric tons for instant coffee production. These facilities ensure the processing and packaging of coffee products to meet the demands of both domestic and international consumers.

With a strong focus on sustainability and quality, Tata Coffee has established itself as a critical player in the coffee industry. The company’s commitment to shade-grown coffee, environmental stewardship, and responsible farming practices resonates with consumers who value ethically sourced and premium coffee products. Tata Coffee’s robust supply chain, diverse product portfolio, and strategic market presence contribute to its success as a leading coffee producer in India and beyond.