Indian footwear retailer Metro Brands' Q3 profit hit by slowing sales
18/01/2024 13:35
BENGALURU, Jan 18 (Reuters) - India's Metro Brands
METB.NS , which sells shoes from brands including Fila, Crocs
and Mochi, reported its fourth straight drop in quarterly profit
on Thursday, hurt by high inventory costs amid slowing sales
growth.
The company's net profit fell 12.6% to 978.1 million rupees
($11.8 million) in the October-December quarter, missing
analysts' estimate of 1.22 billion rupees, as per LSEG data.
The footwear retailer's inventory-related costs -- which
account for about 60% of its total costs since it does not
manufacture its own products -- have been steadily increasing
for most of the year.
They rose 5% in the December quarter and, along with higher
employee and finance costs, pushed total expenses up about 12%.
Metro Brands is the first among listed Indian footwear
retailers, including Bata India BATA.NS and Relaxo Footwears
RLXO.NS , to report its results.
Its revenue rose 6% to 6.36 billion rupees in the quarter,
logging its slowest growth rate since the company went public in
late 2021. Metro did not give details on its sales for the
period.
The company opened 31 new stores in the quarter, bringing
the net stores added this fiscal year to 87.
Metro Brands, recently struck a deal to operate Foot Locker
FL.N stores in India, giving it access to brands such as Nike
NKE.N and Adidas ADSGn.DE in a move that analysts say will
further propel its growth.
Metro Brands' stock price has fallen 8.7% since that deal
was announced. Shares closed up lower at about 1% ahead of the
results.
($1 = 83.1060 Indian rupees)
(Reporting by Navamya Ganesh Acharya and Varun Vyas in
Bengaluru; Editing by Savio D'Souza)
((Navamya.GaneshAcharya@thomsonreuters.com; +91 8805175330 ;))