Metro Brands Reports Mixed Financial Results
Q1 Performance
Metro Brands, an Indian footwear retailer, reported disappointing financial results for the first quarter ending June 30, 2023. The company's profit and revenue fell short of analysts' expectations, raising concerns about the impact of inflationary pressures and muted consumer demand.
Revenue
Metro Brands' total revenue declined by 1.2% year-over-year to 6.78 billion rupees ($86.6 million). This decline was primarily attributed to a decrease in sales of its private label brands, which offset the growth in sales of international brands like Fila.
Profit
The company's net profit plunged by 12.6% to 978.1 million rupees ($12.5 million) during the quarter. This decline was driven by higher input costs and operating expenses, which outpaced the growth in revenue. Metro Brands also reported a reduction in its profit margin, which decreased to 14.4% from 16.1% in the same period last year.
Analysts' Outlook
Analysts tracking the stock expressed mixed views on Metro Brands' growth prospects. While they acknowledged the company's strong brand portfolio and distribution network, they also raised concerns about the challenging macroeconomic environment. They anticipate muted demand in the near term due to inflationary pressures and reduced consumer spending.
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